20070928Mickelsen direct.pdf

""'
t: i;=
zmn SEP 28 Ar110: 00
!!:)/\!"iO PUBLIC
UTlLiT!ES COMtv1!SSIOi\
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION
OF ROCKY MOUNTAIN POWER FOR
APPROVAL OF CHANGES TO ITS
ELECTRIC SERVICE SCHEDULES
CASE NO. P AC-07-
IDAHO IRRIGATION PUMPERS
DIRECT TESTIMONY
MARK MICKELSEN
SEPTEMBER 28, 2007
PLEASE STATE YOUR NAME, ADDRESS, EMPLOYMENT, AND
AFFILIATION WITH THE IDAHO IRRIGATION PUMPERS ASSOCIATION, INC.
My name is Mark Mickelsen, and I am the president of the Idaho Irrigation
Pumpers Association, Inc. ("IIP A"). I farm in the Osgood area of Bonneville County, Idaho.
My address is 9088 N. River Road, Idaho Falls, Idaho 83402. I currently grow potatoes
wheat, and canol a, and my farming operations are principally served by Rocky Mountain
Power ("RMP"
WHAT CRITICAL ISSUES DO IRRIGATORS FACE WHO RECENE
THEIR ELECTRICAL SERVICE FROM RMP?
One of the most significant issues facing irrigators is the loss of the BP A
credit. This loss has caused an increase in irrigators' rates in the neighborhood of 50% to
80%, depending on how you look at it. The irrigators appreciate the actions taken by the
Commission and RMP in May to allow irrigators to continue to receive the remainder of the
BP A credit for the 2007 irrigation season. This action helped mitigate the unexpected, total
loss of the BP A credit.
Another important issue facing irrigators is this rate case. This comes right on the
heels of the total loss of the BP A credit. Frankly, RMP' s rate case, coupled with the loss of
the BP A credit, will have the affect of extreme rate shock to the irrigators. The only
significant tool within the irrigators' control to counter this rate shock is to participate in
Mickelsen, Dir
Irrigators
RMP's load control programs and/or develop additional programs like a time-of-day
irrigation rate as suggested by IIP A's expert.
WHEN DOES BP A EXPECT TO RESTORE ANY OF THE LOST
EXCHANGE CREDIT?
The IIPA has met with RMP, BPA, and Idaho s congressional officials about
the restoration of the BP A credit. Absent some type of settlement between the parties to
court cases, I understand that the 2009 irrigation season is the earliest that any BP A credit
could be restored. It is also my understanding that any future BP A credit will be
substantially lower than that which existed in the past.
DO YOU PARTICIPATE IN RMP'S LOAD CONTROL PROGRAMS?
Yes. I have participated in RMP's load control program for the last three
irrigation seasons. This year I participated in RMP's on-demand pilot program. I believe
that the on-demand pilot program has real promise. Over the years, I have tried to encourage
all irrigators to participate in the load control programs. This is based not only for the credit
savings, but also for the benefits the programs provided to the irrigators' class cost of service
and the benefits of reducing overall RMP system costs.
Mickelsen, Dir
Irrigators
DO YOU BELIEVE THAT THE CREDIT PAID TO THE
IRRIGATORS FOR PARTICPATION IN THE LOAD CONTROL PROGRAM IS
SUFFICIENT?
No. Given the loss of the BP A credit, I believe that all irrigators must
cut costs to stay in business. This necessitates that irrigators must seriously look at
participating in RMP's load control programs. However, the credit paid the irrigators
must be drastically higher to make up for the loss of the BP A credit and to make it
worth while for the irrigators.
I have also reviewed RMP's commissioned report entitled "Assessment of
Long-Term, System-Wide Potential for Demand-Side and Other Supplemental
Resources , dated July 11 , 2007 ("DSM Report"). The DSM Report clearly shows
that the irrigation load control programs are cost effective and provide RMP with
much more in benefits than the associated costs. The IIP A's expert will address the
pricing of the load control credit in his testimony.
Q. DOES THIS CONCLUDE YOUR DIRECT TESTIMONY?
A. Yes.
Mickelsen, Dir
Irrigators