HomeMy WebLinkAbout20211104Application.pdfLISA D. NORDSTROM
Lead Counsel
lnordstrom@idahopower.com
November 4, 2021
Jan Noriyuki, Secretary
Idaho Public Utilities Commission
11331 W. Chinden Boulevard
Building 8, Suite 201-A
Boise, Idaho 83714
Re: Case No. IPC-E-21-37
Application of Idaho Power Company for Authority to Establish A New
Schedule to Serve Speculative High-Density Load Customers
Dear Ms. Noriyuki:
Attached for electronic filing, pursuant to Order No. 35058, is Idaho Power Company’s
Application in the above entitled matter.
If you have any questions about the attached documents, please do not hesitate to
contact me.
Sincerely,
Lisa D. Nordstrom
LDN:sg
Enclosures
RECEIVED
2021 NOV -4 PM 4:55
IDAHO PUBLIC
UTILITIES COMMISSION
APPLICATION - 1
LISA D. NORDSTROM (ISB No. 5733)
Idaho Power Company
1221 West Idaho Street (83702)
P.O. Box 70
Boise, Idaho 83707
Telephone: (208) 388-5825
Facsimile: (208) 388-6936
lnordstrom@idahopower.com
Attorney for Idaho Power Company
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION
OF IDAHO POWER COMPANY FOR
AUTHORITY TO ESTABLISH NEW
SCHEDULE TO SERVE SPECULATIVE
HIGH-DENSITY LOAD CUSTOMERS.
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CASE NO. IPC-E-21-37
APPLICATION
Surging customer interest from large-scale cryptocurrency mining operators to
locate and establish service in Idaho Power Company’s (“Idaho Power” or “Company”)
service area may potentially require significant system resource investment, and creates
risk of those investments becoming stranded assets whose costs may ultimately be borne
by all Idaho Power customers. The Company has received prospective customer interest
of approximately 1,950 megawatts (“MW”) in the last few months, and it is likely that if
even a fraction of that customer interest ultimately interconnected to Idaho Power’s
system, the additional load would exceed the Company’s ability to serve total system load
during the summer season without additional investment in capacity resources. Idaho
Power believes now is the time to proactively mitigate potential system cost and reliability
APPLICATION - 2
risks by establishing a new service offering that is fair, just, and reasonable for existing
and prospective customers.
Idaho Power, in accordance with Idaho Code § 61-502 and RP 052, hereby
respectfully makes application to the Idaho Public Utilities Commission (“Commission”)
for an order prior to the start of the proposed June 15 to September 15 interruption period
authorizing: (1) establishment of a new customer classification applicable to high-density
load (“HDL”) customers operating in a speculative industry, and (2) approval of Schedule
20, Speculative High-Density Load (“Schedule 20”) for HDL customers which includes
energy priced at marginal cost and the requirement to be fully-interruptible at the
Company’s discretion.
I. BACKGROUND
1. Cryptocurrency mining (otherwise known as digital currency mining,
including the mining of Bitcoin (“BTC”) and other cryptocurrencies) is the process of
computers solving complex calculations to validate cryptocurrency transactions on a
blockchain network. A blockchain is a decentralized ledger of all transactions across a
peer-to-peer network. In exchange for the cryptocurrency miners’ work to secure the
blockchain network, new digital “coins” are created which incentivize miners to expand
their efforts. This makes it most profitable to mine when the cryptocurrency’s dollar value
is rising. Cryptocurrency has gained momentum worldwide as a means to decentralize
payments in a largely unregulated platform.
2. Cryptocurrency mining utilizes powerful computers with significant
processing capabilities, and these machines – often bundled together in large volumes –
are significant consumers of energy. It is estimated that worldwide, cryptocurrency mining
APPLICATION - 3
consumes 143 Terawatt hours per year as of May 20211 – or enough energy to power
countries like Norway or Argentina.
3. Unlike traditional enterprise data centers that invest significant capital into
facilities with state-of-the-art infrastructure, cryptocurrency mining operations have the
ability to locate anywhere – from abandoned warehouses to stacked rail cars. This
operational flexibility lends itself to cryptocurrency mining operations siting in areas with
available electrical capacity that requires minimal electrical distribution infrastructure
investment. As significant consumers of energy, the cryptocurrency mining industry is
also highly sensitive to rates, often seeking to negotiate rates to secure the lowest cost
per kilowatt-hour (“kWh”).
Other common attributes that, when combined, demonstrate the nature of
cryptocurrency mining operations include:
High energy use density or intensity of 250 kWh/ft2 annually;
High load factor;
Ability to locate, relocate, aggregate or disaggregate equipment to obtain
favorable rates and/or minimize electrical infrastructure upgrades;
Volatile load growth and load reduction;
Highly responsive to short-term economic signals or volatile commodity
pricing;
Lack of credit history to demonstrate financial viability.
1 Bitcoin Devours More Electricity Than Many Countries, Forbes, May 5, 2021,
https://www.forbes.com/sites/niallmccarthy/2021/05/05/bitcoin-devours-more-electricity-than-many-
countries-infographic/?sh=59e844d041a6
APPLICATION - 4
4. Recent cryptocurrency mining interest in Idaho Power’s service area has
been driven by companies mining BTC, but risks are not limited to that single
cryptocurrency. By design, BTC’s network only releases new cryptocurrency every 10
minutes and the number of coins it releases is set to diminish in the future. This makes
the competition to unlock new BTC more energy intensive because the only way to boost
one’s probability of solving the mathematical calculations is to increase computing power
through the number of machines online.2 Much of the Company’s Application discusses
impacts from BTC mining as it is the predominant cryptocurrency, founded in 2009 and
having the largest market cap, but the considerations and risks hold true for other
cryptocurrencies, and proof-of-work applications which also require significant computer
processing power.
5. As noted, cryptocurrency miners have the ability to scale or disaggregate
operations in a modular manner with mining operations frequently housed in highly
portable shipping container “pods” of varying aggregate capacity. A typical
cryptocurrency miner’s single hardware unit of production is an Application-Specific
Integrated Circuit (“ASIC”) miner, which ranges from 1.3 kilowatts (“kW”) to over 3 kW in
demand. Scaling from one to hundreds of ASIC miners in one location offers flexibility to
the miner in response to power availability and cost, zoning requirements, ambient
temperature and cooling requirements, among other factors.
2 Cryptocurrency Companies Are Leaving China in ‘Great Mining Migration’, Wall Street Journal, August
22, 2021, https://www.wsj.com/articles/cryptocurrency-companies-are-leaving-china-in-great-mining-
migration-11629624602
APPLICATION - 5
II. CURRENT INQUIRIES
6. Idaho Power received limited interest from BTC mining operations between
2019 and 2020; however, recent Chinese restrictions on BTC mining have created a
resurgence of interest in Idaho Power’s service area largely due to the Company’s
favorable rates, open parcels of land in the Company’s service area, and high reliance on
hydroelectric power that can supply operations with desired clean energy. Within the
span of several months, Idaho Power received seventeen (17) viable and unique inquires
totaling over 1,950 MW. These prospective projects often operate under aggressive,
unrealistic timeframes. The projects have expressed a willingness to aggregate or
disaggregate operations in order to obtain the most favorable cost structure, both in terms
of rates and infrastructure upgrades.
7. Based on the speculative nature of these projects, Idaho Power has
communicated that it will not enter into Rule M Facilities Charge service, a non-monopoly
service offered at Idaho Power’s discretion, for these customers. The Company has also
communicated the need for deposits for electric service under Rule L,3 and the
requirement for upfront funding of any necessary infrastructure upgrades.4
III. COMMODITY-LINKED INDUSTRY RISK
8. The profitability of cryptocurrency miners is closely related to the commodity
price of the respective currency. For example, the commodity price of BTC has proven
3 Section 2 of Rule L states that a deposit may be required “if the nature of the applicant’s business is
speculative or subject to a high rate of failure” and the amount shall not exceed two times the actual or
estimated highest monthly bill.
4 Rule H states the rule does not apply to transmission or substation facilities, or to requests for electric
service that are of a speculative nature. Separately, the Company’s Schedule 9 and 19 require “to the
extent that additional facilities not provided for under Rule H, including transmission and/or substation
facilities, are required to provide the requested service, special arrangements will be made in a separate
agreement between the Customer and the Company.”
APPLICATION - 6
to be highly volatile. At the time of this filing, BTC set an intra-day high on October 20,
2021 of $66,930/BTC. The previous intra-day high occurred April 14, 2021 at
$64,863/BTC, and in the subsequent weeks BTC lost one-half of its value before staging
the most recent price rally.
9. Another factor affecting cryptocurrency mining profitability is the complexity
of the calculations to be solved. Because the pace of some cryptocurrency creation is
based on a predetermined schedule, to maintain that schedule cryptocurrency networks
can increase the calculation difficulty when more miners with computer processing power
are in operation. Significant BTC mining processing is currently offline due to the
aforementioned Chinese regulatory actions, with more recent active enforcement, as well
as service shut offs by electric utility companies in June 2021.5 The impacts from the
initiation of Chinese regulatory action in 20196 can be seen in the proportion of BTC
hashrate7 from China decreasing from 75 percent of all BTC mining in September 2019,
to 46 percent in April 20218 and further falling to zero by July 20219 as demonstrated in
Figure 1 on the next page.
5 China is rationing hydropower—and Bitcoin mines are getting cut off, Fortune, June 22, 2021,
https://fortune.com/2021/06/22/china-bitcoin-mining-ban-sichuan-hydropower/
6 China wants to ban bitcoin mining, Reuters, April 8, 2019, https://www.reuters.com/article/us-china-
cryptocurrency/china-wants-to-ban-bitcoin-mining-idUSKCN1RL0C4
7 Hashrate is the speed of mining; it a measure of the computational power used per second.
8 Distribution of Bitcoin Mining Hashrate from September 2019, to April 2021, buy country. Statista.com
https://www.statista.com/statistics/1200477/bitcoin-mining-by-country/
9 US overtakes China as biggest bitcoin mining hub after Beijing ban, Financial Times, October 13, 2021,
https://www.ft.com/content/50acdea5-cad1-4f39-8e6a-9be7ab78485d
APPLICATION - 7
Figure 1. Evolution in Country Share10
10. With the large number of Chinese BTC mining operations recently going
offline, mining difficulty declined by nearly 40 percent in May and June 2021, as
demonstrated in Figure 2. Remaining BTC miners are experiencing improved profitability
while the price of BTC remains elevated, and those profitability levels are enticing new
market entrants.
10 Bitcoin Mining Map Visualisation, Cambridge Bitcoin Electricity Consumption Index, accessed October
27, 2021, https://cbeci.org/mining_map
* To our knowledge, there is little evidence of large mining operations in Germany or Ireland that would
justify these figures. Their share is likely significantly inflated due to redirected IP addresses via the use of
VPN or proxy services.
APPLICATION - 8
Figure 2. Bitcoin Mining Difficulty11
There is high probability12 that Chinese BTC miners will relocate their hardware to
other countries in the next few months, which will result in hashrate returning to prior
11 Network Difficulty, Blockchain.com Mining Information, accessed October 27, 2021,
https://www.blockchain.com/charts/difficulty
12 Cryptocurrency Companies Are Leaving China in ‘Great Mining Migration’, Wall Street Journal, August
22, 2021, https://www.wsj.com/articles/cryptocurrency-companies-are-leaving-china-in-great-mining-
migration-11629624602
Bitcoin Miners Navigate Extreme World of Crypto Power-Hunting, Bloomberg, July 13, 2021,
https://www.bloomberg.com/news/features/2021-07-13/bitcoin-miners-building-rigs-must-navigate-world-
of-crypto-power-hunting
'Up to 1 million' bitcoin processors could be relocated to Alberta from China under energy firm's proposal,
CBC, August 10, 2021, https://www.cbc.ca/news/canada/calgary/bitcoin-mining-black-rock-petroleum-
company-1.6106978
Bitcoin mining crackdown in China is a boon for Texas, yahoo! finance, August 3, 2021,
https://finance.yahoo.com/news/bitcoin-mining-crackdown-in-china-is-a-boon-for-texas-182139400.html
China is kicking out more than half the world’s bitcoin miners – and a whole lot of them could be headed
to Texas, CNBC, June 15, 2021, https://www.cnbc.com/2021/06/15/chinas-bitcoin-miner-exodus-.html
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APPLICATION - 9
highs, reducing or eliminating profitability for less experienced BTC miners. The United
States has emerged as the new hub for cryptocurrency mining, recently becoming home
to more than one third of all global computing power dedicated to mining BTC.13
11. BTC price increases and demand to establish new mining operations in the
last few months closely resemble the period beginning in mid-2017 to the end of 2017
when BTC price increased nearly ten-fold, from approximately $2,000/BTC in June 2017
to nearly $20,000/BTC, by December 2017. As the price of BTC rose, multiple new large
BTC mining operations were established in the U.S., and Idaho Power also saw customer
interest in excess of 500 MW, including several projects that funded upgrades14 to Idaho
Power’s system. However, no large-scale cryptocurrency mining projects went into
service even though they had funded infrastructure investment, largely a result of the
volatile nature of the BTC market. After the peak in December 2017, BTC experienced a
significant price decrease, with prices below $4,000/BTC by the end of 2018. The price
of BTC continued to trade well below the December 2017 highs through 2020, and many
new market entrants who announced or established large mining operations canceled
development, or declared bankruptcy, frequently with electric service providers listed as
creditors and owed multimillions of dollars. Figure 3 plots the timing of five of these
bankruptcies and one cancellation with respect to BTC’s price.
Bitcoin mining comes to Pennsylvania coal country—and raises tough questions, Fortune, August 18,
2021, https://fortune.com/2021/08/18/bitcoin-mining-stronghold-pennsylvania-waste-coal-co2-emissions-
btc-miners/
13 U.S. Takes Bitcoin Mining Crown After China Crackdown, The Wall Street Journal, October 27, 2021,
https://www.wsj.com/articles/u-s-takes-bitcoin-mining-crown-after-china-crackdown-11635327002
14 Two prospective customers funded approximately $200,000 for facilities including feeder upgrades and
various distribution system investment in 2018 but did not ultimately take service from Idaho Power.
APPLICATION - 10
Figure 3. BTC Price and Bankruptcies and Cancelations15
As demonstrated above, the BTC commodity price-linked nature of business
success indicates a speculative investment cycle for miners. The most recent BTC price
gains and mining industry interest have created the potential for greater bankruptcy
losses from a protracted BTC price decline from current levels.
15 1 https://www.coindesk.com/markets/2018/11/21/bitcoin-mining-firm-giga-watt-declares-bankruptcy-owing-millions/
2 https://www.pilotonline.com/business/vp-bz-bcause-bankruptcy-liquidation-20191009-lwot3gx5pnd6di4byqdg3q7tdi-
story.html https://www.financemagnates.com/cryptocurrency/news/us-court-orders-bitcoin-mining-firm-bcause-to-
liquidate-its-assets/
3 https://www.coindesk.com/business/2019/12/05/canadian-government-assisted-bitcoin-miner-files-for-bankruptcy-
owing-millions/
4 https://www.wired.com/story/hard-luck-texas-town-bet-bitcoin-lost/
5 https://apnews.com/article/technology-toronto-financial-markets-bitcoin-montana-
30443b6a900b0e6835baf29cb453319a
https://coingeek.com/poor-business-model-not-covid-19-behind-hyperblock-early-struggles/
6 https://gazette.com/business/colorado-springs-bitcoin-mining-operation-files-chapter-11-
bankruptcy/article_4b42b558-39a7-11eb-a680-bfab3259233b.html
APPLICATION - 11
IV. IDAHO POWER SUMMER SYSTEM CONTRAINTS
12. On June 30, 2021, Idaho Power set a new all-time peak load of 3,751 MW,
and by the end of July, load exceeded the previous 2017 peak demand of 3,422 MW
more than sixty (60) separate hours on twelve (12) different days during the 2021 summer
season.16 Separately, in April 2021 Idaho Power filed to acknowledge an exit date of
2025 for the Company’s North Valmy Unit 2 power plant,17 recognizing that keeping the
134 MW of Valmy Unit 2 generation online was the most economic path for system
reliability through 2025. As further described in the Valmy Unit 2 filing, a request for
proposal for the delivery to Idaho Power of firm capacity and energy during the summer
months through 2025 received no bids, and could be indicative of evolving market
conditions, which factor into the Company’s consideration of reliability.18
13. While some limited near-term summer capacity may come online in
conjunction with the addition of Jackpot Solar in 2022 and potential modification to the
Company’s demand response programs,19 it is likely that summer-season peak
constraints on Idaho Power’s system may be present until the anticipated completion of
the Boardman to Hemingway transmission line in 2026. Further, extreme regional
summer temperatures have created significant upward pressure on market energy prices,
16 IDACORP, Inc Q2 2021 Earnings Call Corrected Transcript, FACTSET: callstreet, July 29, 2021, p. 4.
https://s26.q4cdn.com/720254477/files/doc_financials/quarterly/2021/q2/CORRECTED-TRANSCRIPT_-
IDACORP-Inc.(IDA-US)-Q2-2021-Earnings-Call-29-July-2021-4_30-PM-ET.pdf
17 Application for the Determination Acknowledging its North Valmy Power Plant Exit Date, Case No. IPC-
E-21-12, filed April 30, 2021.
18 Supplement to Application for the Determination Acknowledging its North Valmy Power Plant Exit Date,
Case No. IPC-E-21-12, June 30, 2021.
19 In the Matter of Idaho Power Company’s Application for Approval to Modify its Demand Response
Programs, Case No. IPC-E-21-32, October 1, 2021.
APPLICATION - 12
which traded over $1,000 per MWh in August 202020 and nearly $500 per MWh in June
2021,21 and have caused regional capacity constraints.
V. NEW SPECULATIVE HDL CUSTOMER CLASSIFICATION
14. Idaho Power requests Commission authorization to create a new
classification to take service under the Company’s speculative HDL rate comprised of
customers taking primary or transmission level service which are able to relocate quickly
in response to short-term economic signals, register a metered demand not exceeding
20,000 kW from service at one or more Points of Delivery on the same Premises, and
meet four (4) or more of the following characteristics:
High energy use density;
High load factor;
Load that is portable and distributable;
Highly variable load growth or load reduction as an individual customer
and/or in aggregate with similar customers in the Company’s service area;
High sensitivity to volatile commodity or asset prices;
Part of an industry with potential to quickly become a large concentration of
power demand;
Lack of credit history or ability to demonstrate financial viability.
20 Palo Verde on-peak day-ahead power hits record $1,643.25/MWh, conservation urged, S&P Global,
August 19, 2020 https://www.spglobal.com/platts/en/market-insights/latest-news/electric-power/081920-
palo-verde-on-peak-day-ahead-power-hits-record-164325mwh-conservation-urged
21 California urges power conservation in heat wave, prices soar, Reuters, July 28, 2021,
https://www.reuters.com/business/environment/california-urges-power-conservation-heat-wave-prices-
soar-2021-07-28/
APPLICATION - 13
15. Schedule 19 – Large Power Service, requires customers with aggregate
power requirements receiving service at one or more Points of Delivery on the same
Premises exceeding 20,000 kW (20 MW) to make special contract arrangements with the
Company. Each special contract customer has its own customer class and rates.
Because the Commission must review each special contract to determine fair, just, and
reasonable rates for the special contract customer, as well as assess impacts to all other
Idaho Power customers, the Company believes the special contract process allows for
sufficient opportunity to establish appropriate, cost-based rates for cryptocurrency mining
customers exceeding 20 MW.
16. As noted previously, cryptocurrency miners are uniquely situated where the
mining operation can scale up or down from several kW to hundreds of MW at a location.
Scalability, plus the ability to relocate mining pods, allow miners to easily disaggregate
customer load to fall under Idaho Power’s 20 MW special contract threshold. It is the
combination of ability to disaggregate load (thus avoiding establishing service under a
special contract subject to the review of the Commission) plus business viability linked to
a speculative, volatile commodity, that differentiates these customers and creates a
higher risk to Idaho Power and its customers that costs created by cryptocurrency miners
may become the responsibility of all customers.
VI. PROPOSED SCHEDULE 20 RATES
17. Due to the potential for significant load growth from a speculative, power-
intensive industry exacerbating current summer season system constraints, and from
HDL customers’ ability to disaggregate load and establish service under the Company’s
existing Schedule 9 or 19 to avoid cost assignment under a special contract
APPLICATION - 14
determination, Idaho Power is concerned the Company may need to acquire new
resources that may ultimately become stranded when the economics of cryptocurrency
change. To mitigate that risk while meeting its obligation to reliably serve all customers,
the Company proposes to implement Schedule 20. The proposed Schedule 20 can be
found as Attachment 1 to this Application.
18. The rates included in the proposed Schedule 20 incorporate three (3)
modifications to Schedule 9’s and Schedule 19’s rate design to better align the system
constraints and the speculative nature of the HDL customer class:
1) Service to be fully interruptible by Idaho Power June 15 to September
15 between the hours of 1:00 p.m. and 11:00 p.m., Monday through Friday, excluding
holidays, mirroring the Company’s recently proposed season for its demand response
programs based on updated capacity deficiency analysis.22 Customers would receive
notification at least two (2) hours prior to an interruption event, events may last a
maximum of ten (10) hours per event, and total annual event hours would not exceed 225
hours per year, however the Company would have the option to interrupt beyond the 225
hours per year in the event of a system emergency;
2) Idaho Power proposes to reallocate the portion of cost-of-service
derived summer generation capacity costs currently collected in an on-peak demand
charge to be included in the standard demand charge for Schedule 20. The incremental
addition for these capacity costs is $0.23/kW for Large General Service Rates and
$0.24/kW for Large Power Rates;
22 In the Matter of Idaho Power Company’s Application for Approval to Modify its Demand Response
Programs, Case No. IPC-E-21-32, October 1, 2021.
APPLICATION - 15
3) The Company proposes to price energy at a marginal cost in all
pricing periods, based on Avoided Cost Averages as listed in Technical Report Appendix
C of the Company’s most recently acknowledged Integrated Resource Plan (“IRP”).23
Energy rates will be updated at the time of any change to fixed cost revenue requirement
for Schedule 9 or Schedule 19, and annually on January 1 for the energy marginal cost
component to correspond to that years’ IRP Avoided Cost Average. The Company
proposes that within 45 days of acknowledgement of a subsequent IRP by the
Commission, it be required to file updated energy rates for the Commission’s approval.
These three modifications to Schedule 9’s and Schedule 19’s existing rate design
are included in the proposed Schedule 20 tariff found as Attachment 1, and rate design
workpapers for modifications two and three can be found as Attachment 2 to this
Application.
19. The Company proposes Power Cost Adjustment (“PCA”) treatment for
Schedule 20 be modified as compared to other Idaho Power customer classes in
recognition of the marginal cost energy pricing. First, Schedule 55, the Power Cost
Adjustment rate, will not apply to energy sales to Schedule 20 customers because these
customers pay a marginal energy rate. Second, all costs of supplying power to Schedule
20 will be included in the PCA, and third, revenues received by Idaho Power from
Schedule 20 energy sales will be treated in the same manner as a surplus sale and will
act as an offset to power supply costs. Finally, Schedule 20 energy sales would not be
included as Idaho retail sales for the purposes of the sales based adjustment in the PCA,
23 In the Matter of Idaho Power Company’s 2019 Integrated Resource Plan, Second Amended Appendix
C: Technical Report, Case No. IPC-E-19-19, page 18, filed October 2, 2020, acknowledged March 16,
2021.
APPLICATION - 16
rather treating the energy sales as if they were an off-system sale for PCA accounting
purposes.
20. During the pendency of this case, the Company proposes to place any new
customers who may otherwise qualify for the proposed Schedule 20 service offering on
Schedule 9 or 19, as applicable. Upon Commission approval of a new schedule, the
Company will transition qualifying customers the Commission-approved Schedule 20.
VII. COMMUNICATIONS AND SERVICE OF PLEADINGS
21. While the Company is not aware of any existing customers who would
qualify for Schedule 20, this Application will be brought to the attention of prospective
customers seeking to site in Idaho Power’s service area through a press release that
accompanies this Application and information posted on the Company’s website. Idaho
Power will also keep its Application open for public inspection at its offices throughout the
state of Idaho. Idaho Power believes these efforts will provide appropriate notice to
ventures likely to be impacted by the Company’s Application; however, the Company will,
in the alternative, bring the Application to the attention of its affected customers through
any other means directed by this Commission.
22. Communications and service of pleadings with reference to this Application
should be sent to the following:
Lisa D. Nordstrom Connie G. Aschenbrenner
Idaho Power Company Idaho Power Company
1221 West Idaho Street (83702) 1221 West Idaho Street (83702)
P.O. Box 70 P.O. Box 70
Boise, Idaho 83707 Boise, Idaho 83707
lnordstrom@idahopower.com caschenbrenner@idahopower.com
dockets@idahopower.com
APPLICATION - 17
VIII. MODIFIED PROCEDURE
23. Idaho Power believes that it would be appropriate to process this case by
means of Modified Procedure (i.e., by written submissions rather than by hearing) in
accordance with the provisions of RP 201-210 et seq.
IX. CONCLUSION
24. Idaho Power respectfully requests that the Commission issue an order prior
to the start of the proposed June 15 – September 15 interruption period (1) establishing
a new customer classification applicable to HDL customers operating in a speculative
industry, and (2) authorizing implementation of Schedule 20 for new HDL customers to
include marginal energy pricing and the requirement to be fully interruptible between June
15 and September 15 at the Company’s discretion.
DATED at Boise, Idaho, this 4th day of November 2021.
LISA D. NORDSTROM
Attorney for Idaho Power Company
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
CASE NO. IPC-E-21-37
IDAHO POWER COMPANY
ATTACHMENT 1
SCHEDULE 20
Idaho Power Company
I.P.U.C. No. 29, Tariff No. 101 Original Sheet No. 20-1
IDAHO Issued by IDAHO POWER COMPANY
Issued per Order No. Timothy E. Tatum, Vice President, Regulatory Affairs
Effective – 1221 West Idaho Street, Boise, Idaho
SCHEDULE 20
SPECULATIVE HIGH-DENSITY LOAD
AVAILABILITY
Service under this schedule is available at points on the Company's interconnected system within
the State of Idaho where existing facilities of adequate capacity and desired phase and voltage are
available. If additional distribution facilities are required to supply the desired service, those facilities
provided for under Rule H will be provided under the terms and conditions of that rule. To the extent that
additional facilities not provided for under Rule H, including transmission and/or substation facilities, are
required to provide the requested service, special arrangements will be made in a separate agreement
between the Customer and the Company.
APPLICABILITY
Service under this schedule is applicable to electric service supplied to a Customer at one Point
of Delivery and measured through one meter delivered at the primary or transmission service level. This
schedule is applicable to Customers whose metered energy usage exceeds 2,000 kWh per Billing Period
for a minimum of three Billing Periods during the most recent 12 consecutive Billing Periods. Where the
Customer’s Billing Period is less than 27 days or greater than 36 days, the metered energy usage will be
prorated to 30 days for purposes of determining eligibility under this schedule.
Applicable Speculative High-Density Load Large Power Service Rates are mandatory for
Customers who register a metered Demand of 1,000 kW or more per Billing Period for three or more
Billing Periods during the most recent 12 consecutive Billing Periods.
Customers whose metered Demand per Billing Period has not equaled or exceeded 1,000 kW
more than twice during the most recent 12 consecutive Billing Periods will take service under applicable
Speculative High-Density Load Large General Service rates.
At their expense, Customers may request to establish an additional circuit for building systems
independent of the commercial operational load, such as lighting, climate control, among others, at a
separate Point of Delivery. This additional circuit will be separately metered and billed under the
applicable rate schedule. The Customer will be responsible for the costs associated with installing the
second meter. The Company may refuse to provide service at more than one Point of Delivery at the
same Premises if it is determined by the Company that the additional Point of Delivery cannot be provided
without jeopardizing the safety and reliability of the Company's system or service to the Customer or to
other Customers. Service provided to a Customer at multiple Points of Delivery at the same Premises
will not be interconnected electrically.
This schedule is not applicable to service for resale, to shared or irrigation service, to standby or
supplemental service, unless the Customer has entered into a Uniform Standby Service Agreement or
other standby agreement with the Company, or to multi-family dwellings.
Idaho Power Company
I.P.U.C. No. 29, Tariff No. 101 Original Sheet No. 20-2
IDAHO Issued by IDAHO POWER COMPANY
Issued per Order No. Timothy E. Tatum, Vice President, Regulatory Affairs
Effective – 1221 West Idaho Street, Boise, Idaho
SCHEDULE 20
SPECULATIVE HIGH-DENSITY LOAD
(Continued)
APPLICABILITY (Continued)
Service under this schedule is applicable to and may be mandatory for Customers who have the
ability to relocate quickly in response to short-term economic signals and meet four or more of the
following criteria:
High energy use density;
High load factor;
Load that is portable and distributable;
Highly variable load growth or load reduction as an individual customer and/or in aggregate with
similar customers in the Company’s service area;
High sensitivity to volatile commodity or asset prices;
Part of an industry with potential to quickly become a large concentration of power demand;
Lack of credit history or ability to demonstrate financial viability.
If the aggregate power requirement of a Customer who receives service at one or more Points of
Delivery on the same Premises exceeds 20,000 kW, the Customer is ineligible for service under this
schedule and is required to make special contract arrangements with the Company.
Contract Option. Customers for which this schedule is applicable may optionally take service
under a mutually agreed upon individual special contract between the Customer and the Company
provided the Customer contracts for firm electric Demand of 10,000 kW to 20,000 kW and the special
contract terms, conditions, and rates are approved by the Idaho Public Utilities Commission without
change or condition.
Protection Equipment is the equipment, hardware, and/or software necessary to ensure the
protection of the Company’s system and could include a circuit-interrupting device, protective relaying,
instrument transformers, and associated wiring.
Interconnection Facilities are all facilities which are reasonably required by good practices and
the National Electric Safety Code to interconnect the Customer with the capability to remotely interrupt
the load at the Point of Delivery. Such improvements include, but are not limited to, reclosers, load control
devices, and related equipment.
Upgrades are those improvements to the Company’s existing system, which are reasonably
required by good practices and the National Electric Safety Code to interconnect the Customer with the
capability to remotely interrupt the load at the Point of Delivery. Such improvements include, but are not
limited to, additional or larger conductors, transformers, poles, and related equipment.
Idaho Power Company
I.P.U.C. No. 29, Tariff No. 101 Original Sheet No. 20-3
IDAHO Issued by IDAHO POWER COMPANY
Issued per Order No. Timothy E. Tatum, Vice President, Regulatory Affairs
Effective – 1221 West Idaho Street, Boise, Idaho
SCHEDULE 20
SPECULATIVE HIGH-DENSITY LOAD
(Continued)
INTERCONNECTION PROCESS
Once a request for new Schedule 20 service is received, Idaho Power will perform a study or
studies to determine what Protection Equipment, Interconnection Facilities, and/or Upgrades are
necessary to interconnect the Customer’s load to Idaho Power’s system. The customer shall pay the
actual costs of all required interconnection studies. Any difference between the deposit (if required) and
the actual cost of the study shall be paid by or refunded to the Customer, as appropriate. If, during the
course of preparing a study, the Company incurs costs in excess of the deposit amount, the Company
may require that the deposit amount be replenished in an amount equal to the estimated costs for
completion of the study. If a deposit amount sufficient to pay for completion of the study is not maintained,
the Company may suspend work on the study.
Idaho Power Company
I.P.U.C. No. 29, Tariff No. 101 Original Sheet No. 20-4
IDAHO Issued by IDAHO POWER COMPANY
Issued per Order No. Timothy E. Tatum, Vice President, Regulatory Affairs
Effective – 1221 West Idaho Street, Boise, Idaho
SCHEDULE 20
SPECULATIVE HIGH-DENSITY LOAD
(Continued)
TYPE OF SERVICE
The Type of Service provided under this schedule is three-phase at approximately 60 cycles
and at the standard service voltage available at the Premises to be served.
BASIC LOAD CAPACITY
The Basic Load Capacity is the average of the two greatest monthly Billing Demands established
during the 12-month period which includes and ends with the current Billing Period, but not less than
1,000 kW for Large Power Service.
BILLING DEMAND
The Billing Demand is the average kW supplied during the 15-consecutive-minute period of
maximum use during the Billing Period, adjusted for Power Factor, but not less than 1,000 kW for Large
Power Service.
TIME PERIODS
The time periods are defined as follows. All times are stated in Mountain Time.
Summer Season
On-Peak: 1:00 p.m. to 9:00 p.m. Monday through Friday, except holidays
Mid-Peak: 7:00 a.m. to 1:00 p.m. and 9:00 p.m. to 11:00 p.m. Monday through Friday,
except holidays, and 7:00 a.m. to 11:00 p.m. Saturday and Sunday, except
holidays
Off-Peak: 11:00 p.m. to 7:00 a.m. Monday through Sunday and all hours on holidays
Non-summer Season
Mid-Peak: 7:00 a.m. to 11:00 p.m. Monday through Saturday, except holidays
Off-Peak: 11:00 p.m. to 7:00 a.m. Monday through Saturday and all hours on Sunday
and holidays
The holidays observed by the Company are New Year’s Day, Memorial Day, Independence Day,
Labor Day, Thanksgiving Day, and Christmas Day. When New Year’s Day, Independence Day, or
Christmas Day falls on a Sunday, the Monday immediately following that Sunday will be considered a
holiday.
Idaho Power Company
I.P.U.C. No. 29, Tariff No. 101 Original Sheet No. 20-5
IDAHO Issued by IDAHO POWER COMPANY
Issued per Order No. Timothy E. Tatum, Vice President, Regulatory Affairs
Effective – 1221 West Idaho Street, Boise, Idaho
SCHEDULE 20
SPECULATIVE HIGH-DENSITY LOAD
(Continued)
SUMMER AND NON-SUMMER SEASONS
The summer season begins on June 1 of each year and ends on August 31 of each year. The
non-summer season begins on September 1 of each year and ends on May 31 of each year.
FACILITIES BEYOND THE POINT OF DELIVERY
Pursuant to Rule B, customers taking Primary or Transmission Service are responsible for
providing the transformation of power to the voltage at which it is to be used by the Customer.
INTERRUPTION EVENTS
At its discretion, Idaho Power may call Interruption Events to remotely disconnect electric service
to Customer load under the following parameters:
June 15 through September 15
1:00 p.m. to 11:00 p.m. Monday through Friday, excluding Holidays
Maximum ten (10) hours per interruption event
Up to 225 hours annually
Customer will be notified of upcoming Interruption Event not less than two (2) hours prior to event
start via phone call, or at the Company’s discretion via an alternative mutually-agreed upon method.
POWER FACTOR ADJUSTMENT
Where the Customer’s Power Factor is less than 90 percent, as determined by measurement
under actual load conditions, the Company may adjust the kW measured to determine the Billing Demand
by multiplying the measured kW by 90 percent and dividing by the actual Power Factor.
SPECIAL CONDITIONS
The provisions of Interruption do not apply for any time period that the Company requests a load
reduction during a system emergency or any other time that a Customer’s service is interrupted by events
outside the control of the Company.
TEMPORARY SUSPENSION
When a Customer has properly invoked Rule G, Temporary Suspension of Demand, the Basic
Load Capacity and the Billing Demand Shall be prorated based on the period of such suspension in
accordance with Rule G.
Idaho Power Company
I.P.U.C. No. 29, Tariff No. 101 Original Sheet No. 20-6
IDAHO Issued by IDAHO POWER COMPANY
Issued per Order No. Timothy E. Tatum, Vice President, Regulatory Affairs
Effective – 1221 West Idaho Street, Boise, Idaho
SCHEDULE 20
SPECULATIVE HIGH-DENSITY LOAD
(Continued)
MONTHLY CHARGE
The Monthly Charge is the sum of the following charges, and may also include charges as set
forth in Schedule 91 (Energy Efficiency Rider), and Schedule 95 (Adjustment for Municipal Franchise
Fees).
Large General Service Rates
PRIMARY SERVICE Summer Non-summer
Service Charge, per month $285.00 $285.00
Basic Charge, per kW of $1.28 $1.28
Basic Load Capacity
Demand Charge, per kW of $5.30 $4.67
Billing Demand
Energy Charge, per kWh
On-Peak 7.1423¢ n/a
Mid-Peak 4.9789¢ 4.1868¢
Off-Peak 4.3573¢ 3.5888¢
TRANSMISSION SERVICE Summer Non-summer
Service Charge, per month $285.00 $285.00
Basic Charge, per kW of
Basic Load Capacity $0.68 $0.68
Demand Charge, per kW of
Billing Demand $4.99 $4.51
Energy Charge, per kWh
On-Peak 7.0647¢ n/a
Mid-Peak 4.9167¢ 4.1365¢
Off-Peak 4.3034¢ 3.5504¢
Idaho Power Company
I.P.U.C. No. 29, Tariff No. 101 Original Sheet No. 20-7
IDAHO Issued by IDAHO POWER COMPANY
Issued per Order No. Timothy E. Tatum, Vice President, Regulatory Affairs
Effective – 1221 West Idaho Street, Boise, Idaho
SCHEDULE 20
SPECULATIVE HIGH-DENSITY LOAD
(Continued)
MONTHLY CHARGE (Continued)
Large Power Service Rates
PRIMARY SERVICE Summer Non-summer
Service Charge, per month $299.00 $299.00
Basic Charge, per kW of $1.26 $1.26
Basic Load Capacity
Demand Charge, per kW of $6.25 $4.70
Billing Demand
Energy Charge, per kWh
On-Peak 7.4593¢ n/a
Mid-Peak 4.6039¢ 4.0372¢
Off-Peak 3.7813¢ 3.1600¢
TRANSMISSION SERVICE Summer Non-summer
Service Charge, per month $299.00 $299.00
Basic Charge, per kW of
Basic Load Capacity $0.70 $0.70
Demand Charge, per kW of
Billing Demand $6.07 $4.57
Energy Charge, per kWh
On-Peak 7.4002¢ n/a
Mid-Peak 4.5748¢ 4.0187¢
Off-Peak 3.7572¢ 3.1436¢
PAYMENT
The monthly bill for service supplied hereunder is payable upon receipt, and becomes past due
15 days from the date on which rendered.
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
CASE NO. IPC-E-21-37
IDAHO POWER COMPANY
ATTACHMENT 2
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A B C D E F G H
(a)January 1, 2021 - December 31, 2021 Test Year On-Peak Demand Recovered in On-Peak Demand Charge $331,732
(b)2021 test year kW 1,423,581
(a / b)Demand-Peak added to Demand Charge $/kW 0.23$ <----Adder to Demand rate
Large General Service Peak-Demand Costs to Demand Charge Derivation
(a)(a)
(b)(b)
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B C D E F G H I J
Charge Type Summer Non-Summer Charge Type Summer Non-Summer
Service Charge (per customer)285.00$ 285.00$ Service Charge (per customer)285.00$ 285.00$
Basic Charge per kW of BLC 1.28$ 1.28$ Basic Charge per kW of BLC 1.28$ 1.28$
Demand Charge per kW 5.07$ 4.44$ (rate + b) Demand Charge per kW 5.30$ 4.67$
On-Peak Demand charge per kW 0.95$ n/a On-Peak Demand charge per kW n/a n/a
On Peak Energy Charge per kWh 0.048589$ n/a (rate - c + a) On Peak Energy Charge per kWh 0.071423$ n/a
Mid Peak Energy Charge per kWh 0.044835$ 0.040204$ (rate - c + a) Mid Peak Energy Charge per kWh 0.049789$ 0.041868$
Off Peak Energy Charge per kWh 0.042379$ 0.038854$ (rate - c + a) Off Peak Energy Charge per kWh 0.043573$ 0.035888$
Charge Type Summer Non-Summer Charge Type Summer Non-Summer
Service Charge (per customer)285.00$ 285.00$ Service Charge (per customer)285.00$ 285.00$
Basic Charge per kW of BLC 0.68$ 0.68$ Basic Charge per kW of BLC 0.68$ 0.68$
Demand Charge per kW 4.76$ 4.28$ (rate + b) Demand Charge per kW 4.99$ 4.51$
On-Peak Demand charge per kW 0.95$ n/a On-Peak Demand charge per kW n/a n/a
On Peak Energy Charge per kWh 0.047813$ n/a (rate - c + a) On Peak Energy Charge per kWh 0.070647$ n/a
Mid Peak Energy Charge per kWh 0.044213$ 0.039701$ (rate - c + a) Mid Peak Energy Charge per kWh 0.049167$ 0.041365$
Off Peak Energy Charge per kWh 0.041840$ 0.038470$ (rate - c + a) Off Peak Energy Charge per kWh 0.043034$ 0.035504$
(a)DSM Avoided Cost ($/kWh) S NS
On-Peak 0.050020$
Mid-Peak 0.032140$ 0.028850$
Off-Peak 0.028380$ 0.024220$
(b) Peak Demand Adder ($/kW)0.23$
(c) Embedded Energy Rate ($/kWh)0.027186$
Current 9P Rates Proposed Schedule 20 Large General Service Primary Rates
Current 9T Rates Proposed Schedule 20 Large General Service Transmission Rates
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A B C D E F G H I J K
(a) January 1, 2021 - December 31, 2021 Test Year On-Peak Demand Recovered in On-Peak Demand Charge $1,065,674
(b)2021 test year kW (all 19)4,531,197
(a / b)Demand-Peak added to Demand Charge $/kW 0.24$ <----Adder to Demand rate
Large Power Peak-Demand Costs to Demand Charge Derivation
(a)(a)(a)
(b)(b)(b)
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B C D E F G H I J
Charge Type Summer Non-Summer Charge Type Summer Non-Summer
Service Charge (per customer)299.00$ 299.00$ Service Charge (per customer)299.00$ 299.00$
Basic Charge per kW of BLC 1.26$ 1.26$ Basic Charge per kW of BLC 1.26$ 1.26$
Demand Charge per kW 6.01$ 4.46$ (rate + b) Demand Charge per kW 6.25$ 4.70$
On-Peak Demand charge per kW 0.95$ n/a On-Peak Demand charge per kW n/a n/a
On Peak Energy Charge per kWh 0.052121$ n/a (rate - c + a) On Peak Energy Charge per kWh 0.074593$ n/a
Mid Peak Energy Charge per kWh 0.041447$ 0.039070$ (rate - c + a) Mid Peak Energy Charge per kWh 0.046039$ 0.040372$
Off Peak Energy Charge per kWh 0.036981$ 0.034928$ (rate - c + a) Off Peak Energy Charge per kWh 0.037813$ 0.031600$
Charge Type Summer Non-Summer Charge Type Summer Non-Summer
Service Charge (per customer)299.00$ 299.00$ Service Charge (per customer)299.00$ 299.00$
Basic Charge per kW of BLC 0.70$ 0.70$ Basic Charge per kW of BLC 0.70$ 0.70$
Demand Charge per kW 5.83$ 4.33$ (rate + b) Demand Charge per kW 6.07$ 4.57$
On-Peak Demand charge per kW 0.95$ n/a On-Peak Demand charge per kW n/a n/a
On Peak Energy Charge per kWh 0.051530$ n/a (rate - c + a) On Peak Energy Charge per kWh 0.074002$ n/a
Mid Peak Energy Charge per kWh 0.041156$ 0.038885$ (rate - c + a) Mid Peak Energy Charge per kWh 0.045748$ 0.040187$
Off Peak Energy Charge per kWh 0.036740$ 0.034764$ (rate - c + a) Off Peak Energy Charge per kWh 0.037572$ 0.031436$
(a)DSM Avoided Cost ($/kWh) S NS
On-Peak 0.050020$
Mid-Peak 0.032140$ 0.028850$
Off-Peak 0.028380$ 0.024220$
(b) Peak Demand Adder ($/kW)0.24$
(c) Embedded Energy Rate ($/kWh)0.027548$
Current 19P Rates
Current 19T Rates
Proposed Schedule 20 Large Power Primary Rates
Proposed Schedule 20 Large Power Transmission Rates
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B C D E F G H I J K L M N
year SONP SMP SOFP NSMP NSOFP
2021 50.02$ 32.14$ 28.38$ 28.85$ 24.22$
2022 52.88$ 32.97$ 28.97$ 29.62$ 25.35$
2023 54.91$ 34.45$ 29.94$ 30.49$ 26.42$
2024 56.78$ 36.59$ 32.11$ 32.88$ 27.97$
2025 58.50$ 38.44$ 33.77$ 34.49$ 29.61$
2026 60.06$ 36.45$ 29.23$ 35.82$ 28.36$
2027 61.46$ 38.80$ 32.47$ 38.86$ 31.27$
2028 62.79$ 42.29$ 35.52$ 40.54$ 33.90$
2029 64.09$ 43.66$ 39.51$ 42.43$ 36.96$
2030 65.39$ 44.72$ 38.76$ 42.36$ 36.83$
2031 66.67$ 47.61$ 42.11$ 45.57$ 39.65$
2032 67.95$ 48.68$ 43.86$ 47.19$ 41.24$
2033 69.24$ 49.94$ 44.90$ 48.55$ 42.85$
2034 70.55$ 51.39$ 46.69$ 50.04$ 44.42$
2035 71.90$ 52.98$ 47.92$ 52.00$ 45.97$
2036 73.27$ 55.74$ 49.99$ 54.04$ 47.63$
2037 74.88$ 56.50$ 52.01$ 56.40$ 49.00$
2038 76.53$ 55.18$ 52.09$ 55.50$ 49.35$
2019 Second Amended IRP Technical Appendix C, page 18
Avoided Cost Averages
https://docs.idahopower.com/pdfs/AboutUs/PlanningForFuture/irp/2019/2019
IRPTechAppendixUpdated2.pdf