20171213Comments.pdf

RECEIVED
ROCKY MOUNTAIN 1407 W.North Temple,Suite 310POWER20DDEC[3 M 9:29 Salt Lake City,Utah 84116
A DIVISION OF PACIFICORP
December 13,2017
FI4 OVERNIGHT DELIVERY
Diane Hanian
Commission Secretary
Idaho Public Utilities Commission
472 W.Washington
Boise,ID 83702
Attention:Diane Hanian
Commission Secretary
RE:CASE NO.PAC-E-17-06
IN THE MATTER OF THE APPLICATION OF ROCKY MOUNTAIN POWER
FOR BINDING RATEMAKING TREATMENT FOR WIND REPOWERING
Please find enclosed for filing an original and seven (7)copies of the Company's Comments
supporting the Stipulation filed in the above-referenced matter.
Informal inquiries may be directed to Ted Weston,Idaho Regulatory Manager,at [phone].
Very truly yours,
J'ell R.Stewa d
Vice President,Regulation
Enclosures
Yvonne R.Hogle (ISB No.8930)
1407 W.North Temple,Suite 320
Salt Lake City,Utah 84116
Telephone No.[phone]
Facsimile No.[phone]
E-mail:Yvonne.hoale pacificorp.com
Attorneyfor Rocky Mountain Power
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE CASE NO.PAC-E-17-06
APPLICATION PACIFICORP DBA
ROCKY MOUNTAIN POWER FOR COMMENTS OF
BINDING RATEMAKING TREATMENT ROCKY MOUNTAIN POWER
FOR WIND REPOWERING
PacifiCorp,d.b.a.Rocky Mountain Power ("Rocky Mountain Power"or 'Company"),
hereby provides Comments in support of the Stipulation filed November 24,2017,in the above
referenced matter entered into by and among Rocky Mountain Power,Staff for the Idaho Public
Utilities Commission ("Staff");the Idaho Irrigation Pumper Association,Inc.("IIPA");Monsanto
Company ("Monsanto");and PacifiCorp Idaho Industrial Customers ("PIIC")collectively referred
to as the "Parties".
BACKGROUND
1.The Company's 2017 IRP,filed with the Commission on April 4,2017,identified
wind repoweringas a least-cost,least-risk resource.The 2017 IRP is designed to ensure,on a long-
term basis,an adequate and reliable electricity supply at a reasonable cost and in a manner that is
consistent with the public interest.To that end,the IRP's primary objective is to identify the best
mix of resources to serve customers over the short and long-term,based on an analysis of the costs
and risks associated with various resource portfolios.The IRP identifies the preferred portfolio as
the least-cost,least-risk portfolio that can be delivered through specific action items at a reasonable
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cost and with manageable risks,while ensuring compliance with state and federal regulatory
obligations.
2.Wind repowering involves the installationof new rotors with longer blades and new
nacelles with higher capacity generators,which will increase energy output without changing the
footprint,towers,foundations or energy collector systems of the wind facilities.Using modern
technology and improved control systems,the repowered wind facilities will produce more cost-
effective energy,using zero-cost fuel over an extended useful life at reduced operating costs,
saving customers millions of dollars.Because existing towers and foundations will remain in place
and the footprint of the existing facilities are unchanged,the wind repowering project also results
in minimal environmental impact and permitting requirements.
3.The Company's application proposes to upgrade or "repower"its wind resources
because it provides net benefits to customers by increasing energy production,reducing operating
costs,and requalifying the Company's existing wind resources for federal production tax credits
("PTCs"),which will fully expire by 2020,10 years after the final facility's original commercial
operation date.
4.On July 3,2017,Rocky Mountain Power filed an Application for Binding
Ratemaking Treatment for Wind Repowering ("Application')with the Commission.The
Application requested a Commission determination on the prudence of the Company's plan to
upgrade or "repower"most of its wind resources,and Commission approval of the Company's
proposed ratemaking treatment for new investment and continued rate recovery of and on the
undepreciated balance of the replaced assets associated with the wind repowering project.
5.To match the annual investment,operating costs,and benefits of the repowered
wind projects until the costs and benefits are fully included in base rates,the Company proposed
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a new Resource Tracking Mechanism ("RTM"),which would be included as a component of the
Company's approved Energy Cost Adjustment Mechanism ("ECAM").The benefits of
repowering the wind facilities include new PTCs for the projects and additional zero-fuel cost
energy generation.The ECAM will capture 90 percent of the zero-fuel costs net power cost
benefits associated with the incremental energy production and 100 percent of the PTCs as each
facility requalifies.The Company proposed that there would be no sharing of the incremental
energy generated from the repowered wind projects.Customers would receive 100 percent of the
benefit of the incremental energy produced from these projects.Once the full costs and benefits
are included in base rates,only the incremental fluctuations associated with production levels of
energy and PTCs would continue to be tracked in the ECAM,as they are today,since these are
entirely dependent on the variable output of the facilities.
6.On July 26,2017,the Commission issued a Notice of Application and Order setting
an intervention deadline of August 8,2017,and directing Staff to develop a procedural schedule
for the processing of the matter.On August 18,2017,the Commission issued a Notice of
Scheduling and Notice of Technical Hearing setting a procedural schedule that included a technical
evidentiary hearing on December 7,2017.
7.The Parties to the Application met on October 19,2017,to engage in settlement
discussions.Based upon these settlement discussions the Parties were able to reach a
comprehensive settlement agreement and on November 24,2017,filed a Stipulation resolving all
issues in the docket with the Idaho Public Utilities Commission.
8.Parties to the Stipulation agreed to waive their rights to testify at the scheduled
technical hearing on December 7,2017,and instead requested that the Application and associated
Stipulation be processed under Modified Procedure.On November 30,2017,Commission Order
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33939 provided notice of the proposed Stipulation,Modified Procedure,and set December 13,
2017,as the deadline for comments.
THE STIPULATION
9.The Stipulationwas negotiated in good faith by all the Parties to this Application.
In support of the Stipulation,the Company respectfully requests that the Commission issue an
order finding that the wind repowering project is prudent and in the public interest.Additionally,
consistent with the terms of the Stipulation,the Company requests that the Commission approve
the Company's RTM as a component of the ECAM and approve the Stipulation as filed.
10.The Company acknowledges there are always risks associated with any project and
has therefore incorporated protections and off-ramps to the best of its ability to protect itself and
customers from the risks that are within the Company's control.
l 1.Paragraph 16 of the Stipulation states that if there is a material change in
circumstance,such as changes to federal tax laws,change in the projected costs or benefits,or for
some other reason,the Parties agree that the Company will make a filing with the Commission to
allow for additional review and a determination of whether the Company should proceed with the
implementation of the wind repowering project under the terms and conditions of this Stipulation.
12.As part of Utah Docket No.17-035-39 and Wyoming Docket 20000-519-EA-17,
the Company committed to provide an analysis of the Repowering project with the most updated
information it has available.This will include incorporating the results of the final equipment
selected for the project,any contract terms with the equipment suppliers,and the most current
information associated with tax reform.The Company commits to provide this update to the
Commission and Parties to the Stipulation by February 7,2018.In the event this supplemental
analysis results in a material change to the wind repowering project,the Company anticipates that
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paragraph 16 would be implicated to allow the Commission and Parties an additional formal
review opportunity.
REQUEST FOR RELIEF
Rocky Mountain Power respectfully requests that the Commission approve the Stipulation as filed
and issue an order:(1)finding that the wind repowering project is prudent and in the public interest;
(2)approving the RTM as described in the Stipulation;and (3)approving the continued rate
recovery of and on the replaced assets associatedwith the wind repowering project.
DATED this December 13,2017.
RESPECTFULLY SUBMITTED,
ROCKY MOUNTAIN POWER
YvonneR.Hogle
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CERTIFICATE OF SERVICE
I hereby certify that on this 13th day of December,2017,I causedto be served,via e-mail
a true and correct copy of Rocky Mountain Power's Comments in Case No.PAC-E-17-06to thefollowing:
Service List
IDAHO IRRIGATION PUMPERS ASSOCIATION,INC.
Eric L.Olsen Anthony Yankel
ECHO HAWK &OLSEN,PLLC 12700 Lake Avenue,Unit 2505
505 PershingAve.,Ste.100 Lakewood,Ohio 44107
P.O.Box 6119 E-mail:tonv vankel.net
Pocatello,Idaho 83205
E-mail:[e-mail]
MONSANTO COMPANY
RandallC.Budge Brubaker&Associates
Racine,Olson,Nye &Budge,Chartered 16690 Swingley RidgeRd.,#140
P.O.Box 1391;201 E.Center Chesterfield,MO 63017
Pocatello,Idaho 83204-1391 E-mail:[e-mail]
E-mail:[e-mail] [e-mail]
IDAHO INDUSTRIAL CONSUMERS
Ronald L.Williams Jim Duke
Williams Bradbury,P.C.IdahoanFoods
P.O.Box 388 E-mail:[e-mail]
Boise ID,83701
E-mail :[e-mail]
Kyle Williams Val Steiner
BYU Idaho Nu-West Industries,Inc.
E-mail :williamsk byui.edu E-mail :val.steiner agrium.com
Bradley Mullins
333 SW Taylor,Suite 400
Portland,OR 97204
E-mail:[e-mail]
COMISSION STAFF
BrandonKarpen
Deputy Attorney General
IdahoPublic Utilities Commission
472 W.Washington(83702)
PO Box 83720
Boise,ID 83720-0074
E-mail:brandon.karpenopuc.idaho.gov
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PACIFICORP,DBA ROCKY MOUNTAIN POWER
Ted Weston Yvonne Hogle
PacifiCorp,dba Rocky Mountain Power PacifiCorp,dba Rocky Mountain Power
1407 West North Temple 1407 West North Temple
Suite 330 Suite 320
Salt Lake City,UT 84116 Salt Lake City,UT 84116
E-mail:[e-mail] E-mail:[e-mail]
Data Request Response Center
PacifiCorp
825 NE Multnomah,Suite 2000
Portland,OR 97232
E-mail:datarequest('alpacificorp.com
Dated this 13th day of December,2017.
Katie Savarin
Coordinator,Regulatory Operations
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