20121113Comments and Recommendations.pdf

LAW OFFICES OF
RACINE OLSON NYE BUDGE JE'
W. MARCUS W. NYE CHARTERED RANDALL C. BUDGE
JOHN A. BAILEY, JR. ')fl:1 i I M 9. 53 N&I(
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1
JOHN R. G000ELL 201 EAST CENTER STRL*t' ...
JOHN B. INGELSTROM POST OFFICE BOX 1391
DANIEL C. GREEN POCATELLO, IDAHO 83204-1391 . .........-
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CAROL TIPPI VOLYN
THOMAS J. BUDGE
CANDICE M. MCHUGH
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November 7, 2012
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LOUIS F. RACINE (1917-2005)
WILLIAM D. OLSON, OF COUNSEL
Mrs. Jean Jewell, Secretary
Idaho Public Utilities Commission
P.O. Box 83720
Boise, Idaho 83720-0074
Re: Case No. PAC-E-12-12
Dear Jean:
Enclosed for filing please find the original and seven copies of Comments and
Recommendations of Monsanto Company. Thank you for your assistance.
RCB:rr
Enclosures
cc: Service List (via email)
Randall C. Budge, ISB No. 1949
Thomas J. Budge, ISB No. 7465
RACINE, OLSON, NYE, BUDGE &
BAILEY, CHARTERED
P.O. Box 1391; 201 E. Center
Pocatello, Idaho 83204-1391
Telephone: [phone]
Fax: [phone]
[e-mail]
RECE1VE
212.NQY13 Ali953
IDAHO PULL![,-, -ru rr tDu-c' ' 44t.•
Attorneys for Intervenor Monsanto Company
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION OF )
ROCKY MOUNTAIN POWER FOR ) Case No. PAC-E-12-12
AUTHORITY TO CANCEL SCHEDULE NO. 17 )
AND IMPLEMENT A NEW PARTIAL )
REQUIREMENTS TARIFF )
)
COMMENTS AND RECOMMENDATIONS OF
MONSANTO COMPANY
INTRODUCTION
COMES NOW Intervenor Monsanto Company ("Monsanto") through counsel and
submits these Comments and Recommendations with respect to the August 13, 2012 Application
of PacifiCorp, d/b/a Rocky Mountain Power ("Company") seeking authorization to cancel
Electric Service Schedule No. 17, Standby Service, and replace it with a new Electric Service
Schedule No. 31, Partial Requirements Service. Monsanto's Comments and Recommendations
are in response to the Commission's Order No. 3266 dated October 17, 2012, giving notice of the
Application, that this matter will proceed under Modified Procedure, authorizing interested
persons to file written comments in support or opposition, and providing rights or participation
by filing a Petition to Intervene. Monsanto previously timely filed its Petition to Intevene dated
September 18, 2012.
COMMENTS AND RECOMMENDATIONS OF MONSANTO COMPANY -1
The Company's Application describes the proposed Partial Requirements Service under
Schedule 31 as follows:
465. Partial Requirements Service is designed for customers with on-
site generation, or whose electric service requirements are obtained from any
service other than the Company. Specifically, it consists of Back-up,
Supplementary, Excess and Maintenance power. A customer can contract for
Partial Requirements Service for a minimum of one year. Schedule 31 is not
required where on-site generation is used only for emergency supply during times
of utility outage. Service under Schedule 31 would be available to high voltage
customers with loads up to 15,000 kW. Consistent with Schedule 9, General
Service - High Voltage, customers with loads in excess of 15,000 kW will require
special contract arrangements."
The proposed Schedule 31 would not be applicable to Monsanto, whose loads
substantially exceed 15,000 kW. Accordingly, should Monsanto desire Partial Requirements
Service in the future, special contract arrangements would need to be established with the
Company. Notwithstanding, Monsanto has an interest in this proceeding because the proposed
Schedule 31 would establish the rate for a Partial Requirements Service for Monsanto's load up
to 15,000 kW if a future need arose and also could establish precedent for the need for Partial
Requirements Service for a load in excess of 15,000 kW should Monsanto obtain Electric
Service Requirements from an alternative supplier other than the Company in the future. For
these reasons, Monsanto submits the following Comments and Recommendations.
COMMENTS AND RECOMMENDATIONS
1. Idaho's Schedule No. 31 does not provide for seasonal variation in contract demand.
Utah's Schedule No. 31, however, makes an allowance for seasonal variation in load through a
temporary reduction in the Supplementary Contract Power as explained on Utah Original Sheet
No. 31.6.
Recommendation: The opportunity for seasonal variation in contract demand may be
helpful to Idaho customers, and should be incorporated in Idaho's proposed Schedule No. 31.
COMMENTS AND RECOMMENDATIONS OF MONSANTO COMPANY -2
2.RMP proposes to base the Back-up Facilities Rate on the cost of service results for
Schedule No. 9 from the last general rate case, Case No. PAC-E-11-12, specifically the full
transmission demand cost of $4.14 per kW-month, plus 13% of the full generation cost of $8.45
per kW-month for an annual average Back-up Facilities Rate of $5.24 per kW-month. There is
no reason why the Back-up Facilities Rate should include the full transmission cost, since both
transmission and generation are allocated on the same basis in the cost study, and the reserve
portion can be applied to transmission as well as generation.
The proposed Idaho Back-up Facilities Rate is 58% of the Supplementary Power Rate.'
In contrast, the Utah Back-up Facilities Charge is less than 20% of the Supplementary Power
Charge and the Wyoming Back-up Facilities Charge is 25% of the Supplementary Demand
Charge .3 Consequently, the Idaho Back-up Facilities Rate is out of line with the other states'
partial requirements tariff.
Recommendation: The Back-up Facilities Rate should be based on 13% of both
transmission and generation costs. This results in a charge of$1. 64 per kW-month, on average.
Applying the seasonal rate design, the Back-up Facilities Rate is $1.87 (summer) and $1.41
(winter) per kW-month.
3.RMP proposes a Back-up Power Rate of $0.18 in the summer and $0.13 in the winter.
These seasonal charges are based on difference between the proposed seasonal Back-up Facilities
Rate and the seasonal Supplementary Power Rate, spread over approximately 30 days in a month,
and adjusted by a "ratio of average daily to monthly kW" of 80%. For example, RMP calculates
the summer Back-Up Power Rate as:
($10.26 - $5.97) — average days in the month -- ratio =
$4.29 + 30.4 days/month — 80% ratio = $0.18 per kW per day
The application of the 80% ratio in RMP's rate design calculation means that a customer
Summer: $5.97 ± $10.26 = 58%. Winter: $4.51 - $7.74 = 58%.
2 Supplementary Power Charge is $12.92 during the five summer months, and $8.76 during the seven winter
months, resulting in an average annual rate of $10.49. The Back-up Facilities Charge is $2.02. $2.02 ± $10.49 =
19.3%.
$3.56 ± $14.07 = 25%.
COMMENTS AND RECOMMENDATIONS OF MONSANTO COMPANY -3
requiring back-up power will most likely pay more than a full requirements customer over the
course of a month. For example, a partial requirements customer requiring 30 days of back-up
power in the summer would pay $5.97 plus ($0.18 x 30 days), or $11.37 per kW for the month as
opposed to a full requirements customer paying $10.26 for the same service.
Recommendation: The Commission should avoid establishing rates which can cause a
partial requirements customer to pay more for the same service than afull requirements
customer would pay. The application of a "ratio" in the rate design should be eliminated. This
results in proposed seasonal Back-up Facilities Rates of $1.87 and $1.41 per kW-month, and
Back-up Power Rates of $0.28 and $0.21 per kWper day (summer and winter, respectively).
4.Both the Utah and Wyoming partial requirements tariffs offer time of day components for
the Back-up Power Rate, most likely due to the fact that their otherwise applicable full
requirements tariffs offer time of day pricing. In Utah and Wyoming, back-up demand is
determined only during on-peak hours, and thus back-up demand taken during off-peak hours is
at no charge. (Energy charges, of course, would apply.) While Schedule No. 9 in Idaho does not
currently offer time-of-day demand pricing, time of day pricing could potentially be added to
Schedule No 31 in order to incentivize customers to move their maintenance usage to off-peak
hours.
Recommendation: The Commission should explore adding a time of day criteria to
Idaho's Back-up Power Rate.
5.Both the Utah and Wyoming tariffs include an entire section on how changes may be
made to Total Contract Demand, Supplementary Contract Demand, and Back-up Contract
Demand. See Original Sheet No. 33-9 of Wyoming's Schedule 33, and Original Sheet No. 31.6
of Utah's Schedule 31. The Idaho tariff as proposed by RMP has no provision for changes to
contract demands, either prospectively or retroactively.
Recommendation: A section on "Total Contract Power, Supplementary Contract Power,
and Back-up Contract Power" should be added to Idaho's Schedule 31, including provisions for
seasonal variation in load, based on similar language found in the Utah tarff
COMMENTS AND RECOMMENDATIONS OF MONSANTO COMPANY -4
TOTAL CONTRACT POWER, SUPPLEMENTARY CONTRACT
POWER, AND BACK-UP CONTRACT POWER: The Customer shall contract
for Total Contract Power. This shall be the sum of the Supplementary Contract
Power and the Back-up Contract Power. The Customer may elect to increase
Total Contract Power by increasing Supplementary Contract Power and/or Back-
up Contract Power prospectively at any time, provided there are facilities of
adequate capacity, by providing notice to the Company. The Customer may elect
to increase Total Contract Power by increasing Supplementary Contract Power
and/or Back-up Contract Power retroactively to the most recently completed
billing cycle, provided there are facilities of adequate capacity, by providing
notice to the Company by the statement due date of the billing cycle. Any
increase in Total Contract Power shall establish a new Total Contract Power
which shall be in effect for the term of the contract, unless superseded by
subsequent increases.
Customers experiencing seasonal variations in their load may temporarily
reduce their Supplementary Contract Power during one continuous portion of each
year when usage is low. The period and the amount of the reduction shall be
specified by contract. The period of reduction shall commence at the beginning of
a billing cycle and terminate at the end of a billing cycle, in the event that the
Measured Power exceeds the sum of the reduced Supplementary Contract Power
and the Back-up Contract Power, in any billing cycle during the period of reduced
Supplementary Contract Power, then, for that billing cycle, the reduced
Supplementary Power shall be set equal to the Measured Power less the Back-up
Contract Power, but not greater than the Supplementary Contract Power unless the
Customer elects to increase the Supplementary Contract Power in accordance with
provisions of the previous paragraph.
RESPECTFULLY SUBMITTED this /12 day of November, 2012.
RACINE, OLSON, NYE, BUDGE &
BAILEY, CHARTERED
By- Z~) ~_ ta=414
COMMENTS AND RECOMMENDATIONS OF MONSANTO COMPANY -S
CERTIFICATE OF MAILING
I HEREBY CERTIFY that on this t2 day of November, 2012, I served a true,
correct and complete copy of the foregoing document, to each of the following, via the method so
indicated:
Jean D. Jewell, Secretary (original and 7)
Idaho Public Utilities Commission
P.O. Box 83720
Boise, ID 83720-0074
E-mail: [e-mail] U.S. Mail
Ted Weston
Rocky Mountain Power
201 South Main, Suite 2300
Salt Lake City, Utah 84111
E-mail: [e-mail] E-Mail
Daniel E. Solander
Mark C. Moench
Rocky Mountain Power
201 South Main, Suite 2300
Salt Lake city, Utah 84111 E-Mail
E-mail: [e-mail]
[e-mail]
Ronald L. Williams
PacifiCorp Idaho Industrial Customers
1015 W. Hays Street
Boise, Idaho 83702 E-Mail
[e-mail]
RANDALL C. BUDGE
COMMENTS AND RECOMMENDATIONS OF MONSANTO COMPANY -6