20240119Application.pdf

1407 W. North Temple, Suite 330 Salt Lake City, UT 84116

January 19, 2024

VIA ELECTRONIC DELIVERY Commission Secretary
Idaho Public Utilities Commission
11331 W. Chinden Blvd Building 8 Suite 201A Boise, ID 83714
RE: IN THE MATTER OF THE APPLICATION OF ROCKY MOUNTAIN POWER FOR APPROVAL OF A CAPACITY DEFICIENCY PERIOD TO BE USED FOR AVOIDED COST CALCULATIONS Attention: Commission Secretary

Please find for filing Rocky Mountain Power’s Application in the above-referenced matter along with confidential workpapers. Informal inquiries may be directed to Mark Alder, Idaho Regulatory Manager at [phone].

Very truly yours,
Joelle Steward
Senior Vice President, Regulation and Customer & Community Solutions
RECEIVED
Friday, January 19, 2024 3:49:07 PM
IDAHO PUBLIC
UTILITIES COMMISSION
CASE NO. PAC-E-24-01
Joe Dallas (ISB# 10330) 825 NE Multnomah, Suite 2000
Portland, OR 97232
Telephone No. [phone] [e-mail] Attorney for Rocky Mountain Power

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION OF ROCKY MOUNTAIN POWER FOR APPROVAL OF A CAPACITY DEFICIENCY PERIOD TO BE USED FOR AVOIDED COST
CALCULATIONS
CASE NO. PAC-E-24-01 APPLICATION

Rocky Mountain Power, a division of PacifiCorp (“the Company”), in accordance with
Idaho Code §61-502, §61-503, RP 052, Order Nos. 32697 and 32802 in Case No. GNR-E-11-03
and Order Nos. 35834 and 35882 in Case No. PAC-E-22-14, hereby respectfully submits this
application (“Application”) to the Idaho Public Utilities Commission (“Commission”) for approval
of the capacity deficiency period determination to be used in avoided cost calculations using the
Surrogate Avoided Resource (“SAR”) methodology applicable to small qualifying facilities
(“QFs”) eligible for standard pricing (known as “SAR-Based Contracts”) and in the Integrated
Resource Plan (“IRP”) methodology applicable to larger QFs eligible for project-specific pricing
(known as “IRP-Based Contracts”). This application is intended to establish the capacity
deficiency period for both SAR-Based Contracts and IRP-Based Contracts.1 As more fully
described below, this update identifies Rocky Mountain Power’s capacity deficiency period in the

1 See In the Matter of Rocky Mountain Power’s Application for Approval of a Capacity Deficiency Period to be Used for Avoided Cost Calculations, Case No. PAC-E-22-14, Order No. 35834, p.5 “The Commission has
previously ordered that public utility companies use the capacity deficiency period to determine capacity payments for IRP- and SAR-based contracts to ensure QF’s are only compensated for costs they avoid in the Company’s system. See Order Nos. 33377, 33159, 33898, and 33933. The Commission reiterates the need for the Company to do so in this case through a compliance filing”.
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summer of 2024 and explains how the deficiency period was identified. In support of its
Application, Rocky Mountain Power states as follows:
1. Rocky Mountain Power is authorized to do and is doing business in the state of
Idaho. The Company provides retail electric service to approximately 88,780 customers in the
state and is subject to the jurisdiction of the Commission. Rocky Mountain Power is a public utility
in the state of Idaho pursuant to Idaho Code § 61-129.
COMMUNICATIONS AND SERVICE OF PLEADINGS
2. Communications regarding this Application should be addressed to:
Mark Alder 1407 West North Temple, Suite 330 Salt Lake City, Utah 84116
Telephone: [phone]
Email: [e-mail] Ron Scheirer 825 NE Multnomah, Suite 600
Portland, Oregon 97232
Telephone: [phone] Email: [e-mail]
In addition, the Company respectfully requests that all data requests regarding this matter
be addressed to one or more of the following:
By e-mail (preferred) [e-mail] By regular mail Data Request Response Center PacifiCorp 825 NE Multnomah, Suite 2000 Portland, OR 97232
BACKGROUND
3. Commission Order No. 32697 directed the utilities to initiate a case outside of their
IRP filing to establish the capacity deficiency period to be used in the utility's SAR methodology:
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“We find it reasonable and fair to subject each utility's determination of capacity deficiency to further scrutiny. Therefore, when a utility submits its Integrated Resource Plan to the
Commission, a case shall be initiated to determine the capacity deficiency to be utilized in
the SAR Methodology. The capacity deficiency determined through the IRP planning process will be the starting point, and will be presumed to be correct subject to the outcome of the proceeding.”2
4. In Order No. 32697, the Commission acknowledged that “some determinations
made within the IRP process have an impact on calculations under the SAR and IRP
methodologies. Specifically, the IRP process determines when the utility will experience a need
for new capacity.”3 The Commission ordered that payments to QFs should recognize the utility’s
capacity needs, stating:
“In calculating a QF's ability to contribute to a utility's need for capacity, we find it
reasonable for the utilities to only begin payments for capacity at such time that the utility becomes capacity deficient. If a utility is capacity surplus, then capacity is not being avoided by the purchase of QF power. By including a capacity payment only when the utility becomes capacity deficient, the utilities are paying rates that are a more accurate
reflection of true avoided cost for the QF power.”4
5. In Order No. 35415, the Commission stated that “all future L&R Balances included
in the capacity deficiency date update for avoided costs must contain the most up-to-date
information available at the time of filing.”5
6. In Order No. 34918, the Commission indicated that early retirement of coal-fired
thermal resources should not be reflected in the load and resource balance, “Unless and until this
Commission evaluates and approves an early retirement date…”6

2 In the Matter of the Commission’s Review of PURPA QF Contract Provisions Including the Surrogate Avoided
Resource (SAR) and Integrated Resource Planning (IRP) Methodologies for Calculating Avoided Cost Rates, Case No. GNR-U-11-03, Order No. 32697, p. 23.
3 Order No. 32697, p.23. 4 Order No. 32697, p.21.
5 In the matter of Idaho Power Company’s Application for Approval of the Capacity Deficiency to be Utilized for Avoided Cost Calculations, Case No. IPC-E-21-09, Order No. 35415, p.10.
6 In the Matter of Rocky Mountain Power’s Application for Approval of a Capacity Deficiency Period to be Used for Avoided Cost Calculations, Case No. PAC-E-20-13, Order No. 34918, p.5-6.
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7. In Order No. 35834 the Commission ordered a compliance filing based on the
Company’s application and Staff comments. Order No. 35882 waived the compliance items
(“Compliance Items”) conditional upon the Company incorporating the Compliance Items into
the Company’s application for its 2023 capacity deficiency case.7 The table on page 9 of this
Application delineates how the Company has met each Compliance Item.
REQUEST TO ESTABLISH AVOIDED COST DEFICIENCY PERIOD
5. On March 31, 2023, Rocky Mountain Power filed its 2023 IRP with the
Commission. The 2023 IRP includes the results of the Company's Capacity Loads and Resources
without Resource Additions for the summer season in Table 6.11 on pages 165-166 and for the
winter season in Table 6.12 on pages 167-168. The capacity balance is generally highest for
summer peak loads, with the summer peak occurring annually in July, as the Company is expected
to be deficient in the summer prior to becoming deficient in the winter. The capacity balance is
developed by determining firm resource capacity available, including the Company’s firm access
to imports from the wholesale market (“Front Office Transactions” or “FOTs”), less the system
obligation and a 13 percent planning reserve margin.
6. In light of the risks associated with the evolving resource mix across the west, the
2023 IRP included a Front Office Transaction limit of 500 megawatts in the summer, and 1,000
megawatts in the Winter, as shown in Table 5.8 on page 114. To ensure reliable system operations,
the transmission system operator of each balancing authority area (“BAA”) within the Western
Interconnect is required to maintain contingency reserves equal to three percent of its load and
three percent of its generation, as discussed within the 2023 IRP in Appendix F (Flexible Reserve

7 In the Matter of Rocky Mountain Power’s Application for Approval of a Capacity Deficiency Period to be Used for Avoided Cost Calculations, Case No. PAC-E-22-14, Order No. 35834, p.12 and Order No. 35882, p 2.
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Study). When the Company purchases power from counterparties whose generation resources are
outside of its BAAs, which is typical, the three percent contingency reserve obligation associated
with generation remains in the source BAA, and the counterparty remains responsible for it as one
of the ancillary services provided by the transmission system operator for the BAA in which their
generator resides. Because the Company avoids the contingency reserve obligation associated with
such purchases, which would otherwise be required if it generated the associated power itself, the
effective capacity value of market purchases is three percent higher than the equivalent quantity
of generation capacity.
7. The 2023 IRP shows that the Company’s load and existing resource balance
requires market purchases in excess of the Front Office Transaction limit and throughout the
planning horizon; however, several inputs must be modified to account for changes since the 2023
IRP was prepared as well as the treatment of certain resources identified in Commission orders.
8. The following adjustments were made to account for committed and uncommitted
resource impacts, relative to the representation in the 2023 IRP, specifically:
• Removing uncommitted early coal retirements, consistent with Order 34918.
• Adding contracts signed since the 2023 IRP Update was prepared, and removing
contracts that have terminated or expired.
• Adding contracted resources that have not yet come online, which were not
included in the 2023 IRP tables presenting the load and resource balance without
additions.
• Adjusting QF renewal assumptions: In the 2023 IRP, QFs in all states were assumed
to have a 79% probability of renewal at the end of their current contract term, and
at the end of the current contract the modeled capacity and energy of each QF
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continues at 79% of its prior level. For the avoided cost deficiency period
determination, the load and resource balance has been adjusted so that all Idaho
QFs renew at 100% of their current contracted levels, while QFs in all other states
expire at the end of their current contracts.
• Adding demand response programs that have received Commission approval,
including projected growth in those programs over time.
• Adding FOTs that have already been contracted.
9. After accounting for the adjustments described above, the first capacity deficiency
of 1,327 megawatts occurs in the summer of 2024, as shown in Table No. 1. The first winter
capacity deficiency of 890 megawatts also occurs in 2024 as shown in Table No. 2. Summer
capacity deficiencies continue to be somewhat larger than winter capacity deficiencies throughout
the IRP study horizon.
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Table No. 1 Updated Summer Peak Loads and Resources

Table No. 2 Updated Winter Peak Loads and Resources

10. Based on these updates, the Company requests that the Commission find the
summer of 2024 as the first capacity deficiency period when capacity payments should be made
to QFs under the SAR and IRP avoided cost methodologies.
System 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033
Total Resources 10,496 8,382 8,381 8,265 7,780 7,068 7,229 7,287 6,853 6,158
Obligation 10,919 11,163 11,110 11,285 11,609 11,733 11,727 11,830 11,816 11,857
Planning Reserves (13%)1,419 1,451 1,444 1,467 1,509 1,525 1,524 1,538 1,536 1,541
Obligation + Reserves 12,338 12,614 12,554 12,752 13,119 13,259 13,251 13,368 13,352 13,398
System Position (1,842) (4,232) (4,173) (4,488) (5,339) (6,191) (6,022) (6,080) (6,499) (7,241)
FOT Limit with Reserves 515 515 515 515 515 515 515 515 515 515
Sufficiency/(Deficiency)(1,327) (3,717) (3,658) (3,973) (4,824) (5,676) (5,507) (5,565) (5,984) (6,726)
System 2034 2035 2036 2037 2038 2039 2040 2041 2042
Total Resources 6,185 6,097 6,917 5,715 4,351 4,372 3,772 3,852 4,008
Obligation 11,904 12,003 12,101 12,087 12,180 12,259 12,426 12,571 12,840
Planning Reserves (13%)1,547 1,560 1,573 1,571 1,583 1,594 1,615 1,634 1,669
Obligation + Reserves 13,451 13,564 13,674 13,658 13,763 13,852 14,042 14,205 14,509
System Position (7,266) (7,467) (6,756) (7,943) (9,412) (9,481) (10,270) (10,353) (10,501)
FOT Limit with Reserves 515 515 515 515 515 515 515 515 515
Sufficiency/(Deficiency)(6,751) (6,952) (6,241) (7,428) (8,897) (8,966) (9,755) (9,838) (9,986)
System 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033
Total Resources 8,555 8,896 8,755 9,352 8,648 7,725 7,484 8,520 8,209 7,460
Obligation 9,271 9,486 9,494 9,754 10,026 10,059 10,076 10,115 10,117 10,213
Planning Reserves (13%)1,205 1,233 1,234 1,268 1,303 1,308 1,310 1,315 1,315 1,328
Obligation + Reserves 10,476 10,719 10,728 11,022 11,329 11,366 11,385 11,429 11,432 11,540
System Position (1,920) (1,824) (1,974) (1,669) (2,682) (3,641) (3,902) (2,909) (3,223) (4,080)
FOT Limit with Reserves 1,030 1,030 1,030 1,030 1,030 1,030 1,030 1,030 1,030 1,030
Sufficiency/(Deficiency)(890) (794) (944) (639) (1,652) (2,611) (2,872) (1,879) (2,193) (3,050)
System 2034 2035 2036 2037 2038 2039 2040 2041 2042
Total Resources 7,179 6,696 6,863 6,441 5,037 4,833 4,403 4,237 4,421
Obligation 10,272 10,354 10,365 10,427 10,544 10,687 10,814 10,945 11,130
Planning Reserves (13%)1,335 1,346 1,348 1,355 1,371 1,389 1,406 1,423 1,447
Obligation + Reserves 11,607 11,700 11,713 11,782 11,915 12,076 12,220 12,367 12,576
System Position (4,428) (5,004) (4,850) (5,341) (6,878) (7,243) (7,817) (8,131) (8,155)
FOT Limit with Reserves 1,030 1,030 1,030 1,030 1,030 1,030 1,030 1,030 1,030
Sufficiency/(Deficiency)(3,398) (3,974) (3,820) (4,311) (5,848) (6,213) (6,787) (7,101) (7,125)
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11. Rocky Mountain Power submits this Application to establish the capacity
deficiency period as set forth in Commission Orders No. 32697 and No. 32802, and requests that
the Commission approve the capacity deficiency period to be used in its SAR and IRP-method
calculations.
COMPLIANCE ITEMS
12. The Company has addressed the Compliance Items in Order No. 35814. The
following is a summary of the Compliance Items included with this filing:
determine when capacity payments begin for both
IRP-based and SAR-based contracts/Determination
deficiency period be set for both IRP-based
and SAR-based contracts.
20-year IRP planning horizon, instead of the 9-year
filing/Peak Load Forecast and Future Obligations
the 20-year IRP planning horizon.
Update method, to determine capacity contributions resources added after the 2023 IRP.
state of Idaho, unless the Company has information PURPA contracts located in the state of Idaho.
executed through December 31, 2023, shortly
above the FOTs limit only if it increases the amount of available FOTs that the Company can rely on to applied in the L&R as discussed in this application.
programs that is clearly labeled so that the L&R in the Compliance filing can be verified. program modeled in the 2023 IRP is identified as Commission-approved or future. A
calculation of the growth in the approved DR
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Company can use to m
programs in the Company’s L&R. The Commission
included in the Company’s L&R

MODIFIED PROCEDURE
13. Rocky Mountain Power believes that a hearing is not necessary to consider the
issues presented herein and respectfully requests that this Application be processed under Modified
Procedure; i.e., by written submissions rather than by hearing. RP 201 et seq. If, however, the
Commission determines that a technical hearing is required, the Company stands ready to prepare
and present its testimony in such hearing.
CONFIDENTIAL INFORMATION
14. This filing, specifically the Confidential Workpapers, contain confidential
information including trade secret and other Company confidential information exempt from
public review under Idaho Code §§ 74-104–109 and Idaho Public Utilities Commission’s Rule of
Procedure 67.
CONCLUSION
WHEREFORE, Rocky Mountain Power respectfully requests that the Commission issue
an order authorizing this Application be processed under Modified Procedure and approving the
capacity deficiency period beginning July 2024, be used in the Company's avoided cost
determinations under the SAR methodology, for both SAR-Based Contracts and IRP-Based
Contracts, as shown in Table No. 1 above.
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DATED this 19th day of January, 2024.

ROCKY MOUNTAIN POWER

________________________
Joe Dallas 825 NE Multnomah, Suite 2000 Portland, OR 97232 Telephone No. [phone]
[e-mail]