20160304Update Report.pdf

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Salt Lake city, utah 84116
March 4,2016
VIA OVERNIGHT DELIVERY
Jean D. Jewell
Commission Secretary
Idaho Public Utilities Commission
472W. Washington
Boise, ID 83702
Attention: Jean D. Jewell
Commission Secretary
RE: Case No. PAC-E-13-02
In the Matter of Rocky Mountain Power's Application for an Order Authorizing
Changes in Depreciation Rates Applicable to Electric Property
On November 18, 2013, the Idaho Public Utilities Commission approved an all-party stipulation
in Case No. PAC-E-13-021. Paragraph 28 of the Settlement Stipulition states:
The Stipulating Parties agree the Company will implement a reporting system to
keep the Stipulating Parties and the Utah, Idaho and Wyoming Commissions
informed regarding any matters likely to have implications regarding potential
stranded costs of generating assets. The Company will propose a reporting
method by no later than December 31,2013.
Per this commitment, Rocky Mountain Power submitted a proposal on December 20,2013, to
implement a reporting system that provides information regarding three scenarios which the
Company has identified as having significant implications on the Company's depreciation
expense. Because no party filed comments on the Company's proposal, the Company hereby
submits the filing as originally proposed.
On or before March I of every year, the Company is to file a letter containing the following
information, if applicable.
1) Any proposed early steam generation unit retirement
a. Plant name
b. Date placed in service
c. Current net book value
d. Original retirement date
e. Proposed early shutdown datef. Reason for early shutdown
'OrderNo.32926.
Idaho Public Service Commission
Case No. PAC-E-13-02
Page2
2) Major steam plant capital additions over $100m that impact the depreciation of the
unit
a. Project name
b. Planned in-service date
c. Planned retirement date
d. Planned addition amount to plant in service
3) Any completed external studies regarding plant decommissioning which result in
significant changes (a change of over 25 percent) to the amount previously projected
in the last approved depreciation rates.
a. Plant site
b. Estimated costs
In compliance with the established reporting system, the Company provides the following
information:
1) Any proposed early steam generation unit retirement.
Not at this time. However, the company will be evaluating the economics surrounding
alternative environmental compliance options for Cholla Unit 4 and Naughton Unit 3 as
decision-making timelines for those resources approach. An alternate compliance
proposal that would allow Cholla Unit 4 to be converted to natural gas as a fuel source in
Q2 2025 has been submitted to the U.S. Environmental Protection Agency for review.
Similarly, Naughton 3 has been approved to be converted to natural gas as a fuel source
in Q2 2018. The Company will be assessing those compliance alternatives in future
integrated resource plan filings to this Commission.
2) Major steam plant capital additions over $100 million that impact the depreciation of
the unit are as follows:
Note: The total project amount for Jim Bridger Unit 3 SCR System is approximately $163m and the total
project amount for Jim Bridger Unit 4 SCR System is forecasted at $190m, but PacifiCorp only owns % of
the plant.
3) Any completed external studies regarding plant decommissioning which result
significant changes (a change of over 25 percent) to the amount previously projected
the last approved depreciation rates.
PacifiCorp completed external studies in 2014 to update plant decommissioning cost
estimates for potential out-year decommissioning efforts. The updated studies reflect the
information incorporated below, and will continue to be updated on an as needed basis in
m
m
Project Name Jim Bridger Unit 3 SCR
Svstem
Jim Bridger Unit 4 SCR
Svstem
Planned in-service date November 24,2015 November,20l6
Planned retirement date 2037 2037
Planned addition amount to plant in service S99.9m Sl25.5m
Idaho Public Service Commission
Case No. PAC-E-I3-02
Page 3
support of information needs going forward. The Company is not requesting adjustment
ofapproved depreciation rates for t{nese generation resources.
Questions regarding this filing may be directed to Ted Weston at [phone].
Verytruly yours,
J e(&lrrJ t, t rt e.*-/4-
Jeffiey K. Larsen
Vice President, Regulation