HomeMy WebLinkAbout20231204Comments of the Commission Staff.pdfADAM TRIPLETT
DEPUTY ATTORNEY GENERAL .ggIDAHOPUBLICUTILITIESCOMMISSION
PO BOX 83720
BOISE,IDAHO 83720-0074
(208)334-0318
IDAHO BAR NO.10221
Street Address for Express Mail:
11331 W CHINDEN BLVD,BLDG 8,SUITE 201-A
BOISE,ID 83714
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF ROCKY MOUNTAIN )CASE NO.PAC-E-23-20POWER'S APPLICATION TO UPDATE )LOAD AND GAS FORECASTS USED IN THE )COMMENTS OF THEINTEGRATEDRESOURCEPLANAVOIDED)COMMISSION STAFFCOSTMODEL)
COMMISSION STAFF ("STAFF")OF the Idaho Public Utilities Commission,by and
throughits Attorneyof record,Adam Triplett,Deputy AttorneyGeneral,submits the following
comments.
BACKGROUND
On October 16,2023,Rocky Mountain Power,a division of PacifiCorp
("Company"),applied for approval of its updated load forecast,natural gas price forecast,and
contracts used as inputs in the Company's Integrated Resource Plan ("IRP")avoided cost
calculations,as required by Order Nos.32697 and 32802.IRP avoided cost rates are available to
qualifying facilities ("QFs")that exceed the resource-specific project eligibilitycap for published
avoided cost rates under Idaho's implementation of the Public Utility Regulatory Policies Act of
1978 ("PURPA").The Company requested its Application be processed by Modified Procedure
STAFF COMMENTS 1 DECEMBER 4,2023
with an effective date of October 15,2023.On October 24,2023,the Company filed an Errata to
correct the effective date requested in the Application to January 1,2024.
STAFF ANALYSIS
Staff has reviewed the Company's Application and recommends approval of the
proposed load forecast and the natural gas forecast to be used in the IRP model to determine
avoided cost rates,with an effective date of January 1,2024.Staff also believes the contract
changes listed in the Application are reasonable.Because IRP-based PURPA contracts are
limited to a two-year contract term and the forecasts are resubmitted annuallyfor Commission
approval,only the first few years of the load and natural gas forecasts are relevant to this case.
Load Forecast
Staff believes that the Company's proposed load forecast is reasonable.Staff's
conclusion is based on a comparative analysis of the proposed energy load forecast and last
year's load forecast in Case No.PAC-E-22-16,and an analysis of the proposed system load
broken down by each of the Company's six jurisdictions.
A comparison between last year's energy load forecast and the proposed load forecast in
this case is shown below in Figure No.1.
SystemLoad Forecast
90000
60000
2 50000
LD 40000
30000
20000
10000
0
2022 Load Forecast (GWh)---2023 Load Forecast (GWh)
Figure 1.System Load Forecast Comparison
STAFF COMMENTS 2 DECEMBER 4,2023
Between 2023 and 2027,the proposed load forecast is lower than last year's load
forecast.The Company stated that the lower forecast in this year's update is primarily due to
delays in projects for commercial and industrial customers primarily in Utah and Oregon.See
Response to Staff Production Request No.2 (a).Staff believes the Company's explanation
reasonably accounts for the reduction in load.
The Company also provided a breakdown of the Company's total load for each of its
jurisdictionsas well as load serving Federal Energy Regulatory Commission ("FERC")
customers.Application at 3.From this information,Staff discovered a couple anomalies that fall
outside the time window that would affect any new contracts prior to next year's update.First,
the forecasted load serving FERC customers is zero after July 1,2027.FERC customers are
wholesale customers who can re-sell purchased energy to different retail end users.See
Response to Staff Production Request No.11 (b).Second,compared to last year's filing,Idaho's
load shows a significant reduction in load primarily due to lower expectations for a large
customer,and increased energy efficiency and increased private generation expectations driven
by the Inflation Reduction Act of 2022.See Response to Staff Production Request No.3.
However,when Staff requested additional information about the FERC customers and the large
Idaho customer,the Company objected and withheld the information,citing confidentiality
concerns and claiming disclosure of such information required express customer consent.
Althoughnot critical to this case based on the magnitude of the load reduction during the
relevant timeframe,Staff expects the Company to provide this type of information in an
appropriate manner when it does become relevant and significant.
Natural Gas Forecast
Staff recommends approval of the proposed natural gas forecast because it believes the
proposed natural gas forecast is reasonable.Staff's conclusion is based on comparing the
Company's proposed Henry Hub forecast to the Henry Hub forecast in last year's annual update
and to Idaho Power's Henry Hub forecast.
Comparison to 2022 Annual Update
This year's proposed Henry Hub natural gas forecast is lower than last year's forecast for
the next several years as shown in Figure No.2 below.
STAFF COMMENTS 3 DECEMBER 4,2023
Henry Hub Forecast Comparison
9
2
1
0
2024202520262027202820292030203120322033203420352036203720382039204020412042
2022 Henry Hub Forecast -2023 Henry Hub Forecast
Figure No.2:Comparison of 2022 and 2023 HenryHub Forecasts
Staff believes this is reasonable because the impact from the Russia and Ukraine conflict
that was affecting European gas supplies driving up U.S.gas prices has abated.Then starting in
month 49,gas prices start to fall as a result of the forecasted decrease in liquified natural gas (LNG)
demand.See Response to Staff Production Request No.6.Ultimately,gas prices increase again due
to higher costs of production.See Response to Staff Production Request No.6.
Comparison to Idaho Power's HenryHub Forecast
Staff compared the Company's proposed Henry Hub forecast to Idaho Power's most
recent Henry's Hub forecast.The similarity between the two forecasts over the next couple
years lends additional support to Staff's conclusion that the Company's proposed forecast is
reasonable.
Contract Updates
Contract updates are incorporated into the IRP model on a continuous basis,but the
annual filing is a good opportunityfor the Commission to review and monitor these updates.
Since last year's annual filing in Case No.PAC-E-22-16,the Company has signed 29 long-term
contracts.Five long-term contracts have terminated or expired.Staff believes the contract
updates included in the Application are reasonable.
STAFF COMMENTS 4 DECEMBER 4,2023
STAFF RECOMMENDATION
Staff recommends approval of the proposed load and the natural gas forecast to be used
in the IRP model to determine avoided cost rates,with an effective date of January 1,2024.
Respectfully submitted this 4th day of December 2023.
Adam Triplett
Deputy AttorneyGeneral
Technical Staff:Yao Yin
Kevin Keyt
i:umisc/comments/PAC-E-23-20 Comments
STAFF COMMENTS 5 DECEMBER 4,2023
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 4th DAY OF DECEMBER 2023,SERVED THE FOREGOING COMMENTS OF THE COMMISSION STAFF TO
ROCKY MOUNTAIN POWER,IN CASE NO.PAC-E-23-20,BY E-MAILING A
COPY THEREOF,TO THE FOLLOWING:
MARK ALDER JOE DALLAS
ROCKY MOUNTAIN POWER ROCKY MOUNTAIN POWER
1407 WEST NORTH TEMPLE STE 330 825 NE MULTNOMAH ST
SALT LAKE CITY UT 84116 STE 2000
E-MAIL:mark.alder@pacificorp.com PORTLAND OR 97232
E-MAIL:joseph.dallas@pacificorp.com
DATA REQUEST RESPONSE CENTER
E-MAIL ONLY:
datarequest@pacificorp.com
SECRETARY
CERTIFICATE OF SERVICE