19901217Said Direct.pdf

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BEFORE THE IDAHO PUBLIC UTILITIES COl',lMISSION
IN THE MATTER OF THE APPLICATION
OF IDAHO POWER COMPANY FOR APPROVAL
OF AN INTERCONNECTION TARIFF FOR
NON-UTI LITY GENERATION.
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CASE NO. IPC-E-90-20
IDAHO POWER COMPANY
DIRECT TESTII4ONY
OF
Gregory lrl. Sajd
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Please state your name and busjness address.
lrlest Idaho Street, Boise, Idaho.
By whom are you emp'loyed and jn what capac'ity?
I am employed by Idaho Power Company as a Rate Analyst in the
Rate and Tari ff Department.
Please describe your education background and bus'iness
experi ence.
In May of 1975, I recejved a Bachelor of Scjence Degree with
honors in Mathematjcs from Bojse State Univers'ity. I was
employed by the State of Idaho from 1977 to 1980, first as a
Research Techn'ician for the Idaho Transportation Department
and then as a Research Ana'lyst for the Idaho Department of
Employment. In August, 1980, I became employed by the
Resource Planning Department of Idaho Power Company. My
respons'ibilities in that Department jncluded the development
and maintenance of the Secondary Transaction Simulation Model,
estimation of operation costs for budget analyses and five-
year forecasts of generation and power supply cost,
development and evaluation of exhib'its relat'ing to system
operating cost determinat'ions and compari son of system
operating costs for alternate resource p1ans. In September,
1989, I became a Rate Ana'lyst for the Rate and Tarjff
Department.
Were you instructed to coordinate the preparation of a tariff
Sa'id, D'i 1
Idaho Power Company
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schedule to address the jnterconnection of non-util jty
generation to the Company's system?
Yes, I was.
l,lhy i s there a need for such a schedul e?
The Company has a schedule addressing 0verhead and Underground
Distribution Line Extensions to consumers of electricity, but
there 'i s no correspondi ng schedul e address'ing s'imi I ar
interconnections for non-utility generators of electricity.
Historically, detajls concern'ing these interconnections have
been jndjvidually negotiated. Now that the Company has
gained experience in this area, the development of a schedule
directly addressing these interconnectjons will simplify the
process and ensure that all non-utility generators are treated
under standard terms and conditions.
Have you patterned this schedule after Schedule 7l?
Yes. Because there are similarities between "line extensions"
and "interconnections", whenever it was appropriate I have
attempted to make this schedule similar to Schedule 71.
What is the d'istinction between a "line extension" and an
"interconnection".
So as not to cause confusion by having two schedules wh'ich
address I ine extensions, the Company refers to the
construction, upgrade, relocation or removal of either
transmission or distribution 'lines and equipment for the
purpose of connecting a non-ut'iljty's generation plant to the
Said, Di 2
Idaho Power Company
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Company's system as an "interconnection". A 'line extensjon"
refers to the construction, upgrade, relocation, or removal of
distribution equipment for the purpose of providing servjce to
customers under Company tariff schedules l, 7,9,18, 19,24,
33, 45, and 46.
Did you coordjnate the preparation of Exhjbjt 1?
Yes. Exhjbit I is a six page tariff schedule entjtled
"lnterconnections to Non-Utjlity Generation". The first two
pages consjst of definjtions of tariff schedule terms. The
final four pages provide for the cost, payment, construction,
transfer, vested interest, operation and maintenance
ob1 igations and expenses assocjated with interconnection
facilities.
Please describe the provisions for the cost of and payment for
interconnecti on facil iti es.
The cost of the interconnectjon faciljt'ies addressed on page
3 of Exhibit 1 consists of the Company's constructjon cost
plus the cost of any facilitjes transferred by the seller of
non-uti i 'i ty generati on to the Company. Unl ess otherw'i se
specifically agreed to, the seller will pay a1l these costs.
The seller then has a vested interest in these Company owned
facilities, and js entitled to a vested interest refund if
another seller of non-utility generation or an Idaho Power
customer later shares use of the facilities.
Pl ease descri be the prov'i sions for ownershi p of
Said, Di 3
Idaho Power Company
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interconnection faci I ities.
As stated 'in the construction of interconnection facilities
section of the tariff schedule (found on page 3 of Exhjbit l,)
the Company wi1'l oh,n, operate, and maintain all Disconnect
Equipment and Metering Equipment as well as upgrades and
relocations of the Company's system. The Company's experjence
with interconnections with non-uti1 ity generators has
demonstrated that for safe and efficient operation of the
Company's system, 'it i s necessary that Idaho Power ou',n,
operate, and maintain these specific portions of the
i nterconnecti ons .
All sther interconnection facilities may be owned by either
the seller of non-utility generation or the Company. The
seller may also transfer seller furnished fac'ilities to the
Company.
Please discuss the conditions for transferring ownersh'ip of
seller furnished faciljties to the Company.
The conditions are found on pages 3 and 4 of Exhibit 1. The
first condit'ion is that the Company must agree to the
transfer. If the Company agrees to accept the transfer of
seller-owned facjlities, the transactjon must provide for such
things as design approval, inspect'ions, insurance, acceptable
easements, assurances that the facilities are free of 1iens,
and a warranty on materials and workmansh'ip. The exact
requirements differ depending on the time of transfer. If
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Idaho Power Company
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transfer occurs after the date that the seller of non-ut'i1ity
generation begins del'ivering energy to the Company's system,
the facilities are depreciated on the same basis that the
Company depreciates its own facilities.
How can non-utility generators rece'ive refunds for a portion
of their investment in interconnection facilities?
As in Schedule 71, the ljne extensjon tariff, for a five year
period of time following the date that the Company comp'letes
construction of its portion of the interconnect'ion faciljtjes,
the non-utjlity generator will be entitled to recejve vested
interest refunds when other sellers of non-utility generation
or customers of Idaho Power Company share the use of a portion
of the interconnection facjlities. The refund payment will be
based upon distributing the costs of the shared faciljties
among those shari ng the faci I i t'ies .
Please describe how the interconnection costs are distributed
among those jnd'ividuals sharing the facilities.
Again, as jn tariff Schedule 71, the method of determining
each indjvidual's share of the costs'is based upon the ratio
of their connected load or in the case of Schedule 72 peak
generation to the total connected load and peak generation on
the line as well as the ratio of the individual's linear foot
usage of ljne to the total length of the l'ine. The two rat'ios
are mu'lt'ipl ied by the original interconnection cost.
Are there any operation and maintenance obligations to be paid
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Idaho Power Company
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by the non-utility generators?
Yes. Idaho Power Company's customers pay operation and
maintenance expenses through their rates. Non-ut'i1 ity
generators are producers of electricity rather than consumers
of electrjc'ity and as a result do not have the same method for
paying their share of operation and maintenance costs.
Therefore, an operatjon and maintenance charge for Company-
owned facilities operated and maintained for the benefit of
non-utif ity generators has been provided for in this Schedule.
This operation and maintenance charge is the same charge that
has been included in all individual'ly negotiated contracts
previous'ly establ ished with non-util ity generators.
Does this conclude your direct test'imony?
Yes, it does.
Said, Di 6
Idaho Power Company
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IDAHO POt,lER COMPANY
I.P.U.C. N0.25. TARIFFi, .. 1ol ORIGINAL SHEET NO. 27F
SCHEDULE NO. 7?
AVAILABILITY
Throughout the Company's service area with'in the State of Idaho.
APPLICABILITY
Th'is schedule applies to the construction, Upgrade, Relocation, or removal of
transmission and/or distributjon lines and equipment necessary to safely interconnect a
Sel I er's generat'ion pl ant to the Company's system.
DEFINITIONS
Additional Aooljcant: A person or entjty whose request for electrical connectjon
requires the Company to utilize existing Interconnectjon Facjljtjes whjch are subject to
a Vested Interest.
Comoanv: The ldaho Power Company.
Construct'ion Cost: The cost, as determ'i ned by the Company, of Upgrades , Re'l ocat i on
or constructi on of Company furni shed Interconnect'ion Fac'il i ti es .
Disconnectjon Eouioment: Any device or comb'ination of devices by whjch the Company
can manually and/or automatically interrupt the flow of energy from the Seller to the
Company's system, including enclosures or other equipment as may be requ'ired to ensurethat only the Company will have access to certajn of the devjces.
Fi rst Enerqy Date: The date when the Se1 'l er begi ns de1 i veri ng energy to the
Company's system.
Interconnection Fac'i'ljties: A1l facilitjes which are reasonably required by prudent
electrical practices and the Nat'ional Electric Safety Code to interconnect and to allow
the deiivery of energy from the Seller's generation plant to the Company's system,including, but not limited to, Special Fac'ilities, 0'isconnection Equipment and Metering
Equi pment.
ssuFiled - December 14, 1990
Effect'ive - February 1, 1991
D. H. Jackson - Vice President, D'istribut'ion
1220 Idaho Street, Boise, Idaho
Exhibir No' 1
Case No. |PGE gG20
G.w. Said' IPCO
Paoe 1 ct{ 6
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I.P.U.C. N0.25. TARIFF ORIG INAL SHEET NO. 27G
SCHEDULE NO. 72
i nued )
l,leterino Eoujoment: Equ'ipment required to measure, record 0r telemeter power flows
between the Seller's generatjon plant and the Company's system.
Rel ocat j on : A change i n the I ocat'ion of ex'i st'ing Company-owned transmi ss'ion and/ ordistribution I ines, poles or equipment.
Seller: A non-utility generator who has contracted or will contract wjth the
Company to supply energy.
Sel'ler Furnjshed Facjljtjes: That portion of the Interconnection Faciljties
provided by the Seller.
Soecial Facilities: Addjtions or alterations of transm'ission and/or djstribution
ljnes and transformers, 'including, but not ljmited to, Upgrades and Relocat'ion,"to safely
interconnect the Seller's generation plant to the Company's system.
Transfer Cost:The cost, as determ'ined by the Company, for acceptance by the
shed Faci I 'iti es .Company of Seller Furnj
Uporades: Those improvements to the Company's existing system whjch are reasonably
required by prudent e'lectrical practices and the Nat'ional Electric Safety Code to safely'interconnect the Sel I er to the Company's system. Such 'improvements i ncl ude, but are not
l'im'ited to, addjtional or larger conductors, transformers, poles, and related equipment.
Vested Interest: The claim for refund that a Seller or Addjtjonal Appljcant holdsin a specific port'ion of Company-owned Interconnection Fac'il jties. The Vested Interest
expires five years from the date the Company completes construct'ion of its portion of the
Interconnect'ion Facilities unless fu11y refunded earl jer.
ssFiled - December 14, 1990
Effectjve - February 1, 1991
D. H. Jackson - Vice President, Distribut'ion
i220 Idaho Street, Boise, Idaho
Exhibit No' 1
Case No. IPGE-9G20
G.w. Said, IPCO
Paoe 2 ol 6
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SCHEDULE NO. 72
INTERCONNECTIONS TO
NON-UTI L ITY GENERATION
( cont i nued )
COST OF INTERCONNECTiON FACILITIES
41'l Interconnect'ion Faci'lities prov'ided under this Schedule wjll be valued at the
Company's Construction Cost and/or the Transfer Cost for vest'ing purposes as well as for
operation and maintenance payment ob1igations.
PAYMENT FOR INTERCONNECTION FACILITIES
Unless specifica11y agreed otherwise in the Fjrm Energy Sa1es Agreement between a
Seller and Company, Seller will pay all costs of interconnecting a Facifity to the
Company's system. Project specific payment provisions w'ill be set out in the F'irm Energy
Sa1es Agreement between Seller and Company or the agreement implementing Schedule 86
(Cogenerat'ion and Small Power Production Non-Firm Energy) or its successor schedule(s).
CONSTRUCTION OF INTERCONNECTION FACiLiTiES
The Company will construct, own, operate and maintain al'l Disconnection Equipment,
|'1etering Equipment, Upgrades and Relocation. Seller may construct, install, own, operate
and majntain all other agreed upon Interconnect'ion Facilitjes. The Seller may retain
ownersh'ip of Se1'ler Furn'ished Facjl'ities or may transfer them to the Company.
TRANSFER OF INTERCONNECTION FACILITIES
(A) Transfer at Fjrst Enerov Date: if the Se'l'ler desires to transfer and idaho
Power desjres to accept any Seller Furnished Faciljties at the First Energy Date, the
followjng will apply:
(i) Prior to the beg'inning of construction, Seller shall cause the contractorthat is constructing the Seller Furnished Facilities to provide the Company with acertificate nam'ing the Company as an addjtiona'l insured in the amount ofnot less than onemillion dollars under the contractor's general liability policy.
' (2) The Company wiii prov'ide Seller's contractor w'ith construction and material
spec'ifications and will have final approval of the des'ign of the Seller Furnished
Facil ities.
(3) During construction and upon comp'letion, the Company will inspect the
Seller Furn'ished Facjl'ities to be transferred to the Company. The cost of such 'inspection
wi I 'l be borne by the Sel I er.
Fi I e - December 14, 1990 D. H. Jackson - Vice Pres'ident, Djstribution
1220 idaho Street, Boise, Idaho
E:xhibit No. 1
Case No. IPGE-9G20
G.W. Said'
Paoe 3 oi 6
Effective - February 1, i991
IDAHO POWER COMPANY
tlI.P.U.C. NO. 25. TARIFF . TOl ORIGINAL SHEET NO. 27H
I U^r rv r vn Lr\ u\,,l'lrrlll I
I.P.U.C. NO. 25. TARIFF NOi )1 ORIGINAL SHEET NO. 27I
SCHEDULE NO. 7?
INTERCONNECTiONS TO
Continued)
(4) If the Seller Furnished Fac'iljties meet the Company's design, material
and construction specifications, are free from defects in materials and workmanship, and
the Seller has provided the Company w'ith acceptabie easements, bills of sale and assurance
against labor or materials'liens, the Company will accept ownership effective as of theFirst Energy Date. In the bill of sa1e, the Seller wil'l warrant to the Company that the
Seller Furnished Facil ities are free of any 'ljens or encumbrances and wil'l be free from
any defects in materials and workmanship for a period of one year from the Fjrst Energy
Date.
(B) Subseouent Transfer: If, after the First Energy Date, the Seller desires to
transfer and Idaho Power desjres to accept any Seller Furnjshed Facilities, the followingwill app'ly:
(1) The Company wilf inspect the facilitjes proposed for sa'le to determjneif they meet the Company's design, material and construction specifications.
(2) The Company will determjne the Transfer Cost of such fac'il it1es. The
Transfer Cost will be equal to the depreciated Construction Cost the Company would have'incurred jf it had originaliy constructed the facil'ities plus the cost, jf dDJ, ofbring'ing the fac'il jt j es jnto compl i ance with the Company's design, material and
construct'ion specificat'ions. Depreciation of the faci'litjes proposed for transfer will
be determ'ined on the same basis as the Company depreciates 'its own fac'il'ities in
accordance w'ith the appropriate FERC account numbers for the type and size of ljne or
equipment involved. The tjme period used for the calculat'ion of the deprec'iated transfer
cost wi'll extend from the First Energy Date until the agreed upon transfer date. The
Transfer Cost will be pa'id to the Company in cash at the time of transfer. At the same
t i me, the Company wi'l I pay the Sel I erin cash an amount equal to the depreci ated
Construction Cost.
(3) As a condition of the Company's acceptance, the Se1'ler will provide the
Company wi th acceptab'l e easements, bi I I s of sal e and acceptab'le assurance agai nst I abor
and materia'l Iiens. The bill of sale wi'll include a warranty that the transferredfacilitjes are free of a'll liens and encumbrances and wiil be free from any defects inmaterials and workmanship for a period of one year from the date of transfer.
(4) Effective as of the date of the transfer, Company will operate and
ma'inta i n the transferred faci I i ti es .
T
I DAHOFiled - December 14, 1990
Issued bv IDAHO POWER COMPANY
D. H. Jackson - Vice President, Distribution
1220 Idaho Street, Boise, Idaho
Exhibit No. 1
Case No. |PGE 9C20
G.W. Said,
Paoe 4 o{ 6
Effective - February 1, i99i
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IDAHO POI.,ER COMPANY
SCHEDULE NO. 72
INTERCONNECTIONS TO
NON.UTi LITY GENERATION
( Cont i nued)
VESTED INTEREST
A Seller's e'ligibility for a Vested Interest refund w'ill exist for five years after
the date the Company compietes constructjon of its portion of the InterconnectjonFacilities.
1. The Company w'i11 provide a refund payment to each Seller holdlng a
Vested Interest 'in Company-owned Interconnect'ion Fac'il jtjes when an Additionai Appl icant
shares use of those Interconnecti on Faci I i ti es .
2. The refund payment will be based on the followjng formula:
Refund =
Li near
Footage
Rati o
xx
Connected
Load/Peak Generation
Ratio
Original
Interconnecti on
Cost
a. The L'inear Footage Ratio 'is the 'length of jointly used Speci a1Facilities divided by the length of the vested Speciai Facjlit'ies.
b. The Connected Load/Peak Generation Ratio js the Connected Load or
Peak Generation of the Additional Applicant djvided by the sum of the
Connected Load or Peak Generation of the Add'itional Applicant and all other
Connected Loads and/or Peak Generation on the Speciai Faciljties.
c. The 0rjginal Interconnection Cost js the sum of the Company's
Construction Cost and any Transfer Costs for the Interconnect'ion Facilit'iesto which the Additional Applicant intends to connect and share usage.
, 3. The Additional App'l'icant will pay the Company the amount of the VestedInterest refund(s). Additjonal Applicants making Vested Interest payments are in turn
el igible to receive refunds with'in the S-year 'l'im'it described above.
4. Vested Interest refunds will not exceed 100 percent of the refundableportion of any party's cash payment to the Company.
5. Vested Interest refund payments may be waived by notify'ing the Companyin writing.
Fjled - December 14, 1990
Effective - February 1, 1991
D. H. Jackson - Vice s"l t, Di stri ution
1220 Idaho Street, B,ontr,,k. Idaho
Case No. tpCE-9G20
G.W. Said, tpCO
Paoe s of a
IDAHO POWER COI'IPANY /
I.P.U.C. NO. 25. TARIFF NO J1 ORIGINAL SHEET NO. 27K
SCHEDULE NO. 72
( Cont i nued )
OPERATION AND I'IAINTENANCE OBLIGATIONS AND EXPENSES
The Company will operate and maintain Company furnished Interconnectjon Facilitjes
as we'|1 as any Se1'ler Furnished Faci'lities transferred to the Company. In considerationof such operation and maintenance services, Seller will pay the Company a monthly
operation and maintenance charge equal to a percentage of the Construction Cost and
Transfer Cost paid by the Sel'ler. The percentage is 0.4%for 138 kV and 16i kV facilities
and 0.7% on facilities below 138 kV.
The cost uponwhich an indjvjdual Seller's operat'ion andmaintenance charge is basedwill be reduced by subsequent Vested Interest refunds. Additjonal Applicants who are
Sellers wi'll pay the monthly operation and maintenance charge on the amount they paid as
an Addit'iona'l Appi'icant.
Seller Furnjshed Facjljties not transferred to the Company wi1'l be operated and
mainta'ined by the Seller at the Seller's sole risk and expense.
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Filed - December 14, 1990
Effective - February 1, 1991
D. H. Jackson - Vice President,i stri t0n
1220 Idaho Street, Bo'i se, Idaho
Exhibit No. 1
Case No. IPGE-9G20
G.W. Said, IPCO
Paoe 6 ol 5