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HomeMy WebLinkAbout20170609Johnson Exhibit 6.pdf DAVID J. MEYER VICE PRESIDENT AND CHIEF COUNSEL FOR REGULATORY & GOVERNMENTAL AFFAIRS AVISTA CORPORATION P.O. BOX 3727 1411 EAST MISSION AVENUE SPOKANE, WASHINGTON 99220-3727 TELEPHONE: (509) 495-4316 FACSIMILE: (509) 495-8851 DAVID.MEYER@AVISTACORP.COM BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION IN THE MATTER OF THE APPLICATION ) CASE NO. AVU-E-17-01 OF AVISTA CORPORATION FOR THE ) AUTHORITY TO INCREASE ITS RATES ) AND CHARGES FOR ELECTRIC AND ) NATURAL GAS SERVICE TO ELECTRIC ) EXHIBIT NO. 6 AND NATURAL GAS CUSTOMERS IN THE ) STATE OF IDAHO ) WILLIAM G. JOHNSON ) FOR AVISTA CORPORATION (ELECTRIC ONLY) Avista Corp. Power Supply Pro forma - Idaho Jurisdiction System Numbers - 2016 Actual and 2018 Pro Forma Test Year Load Line 2016 2018 No.Actuals Adjustment Pro Forma 555 PURCHASED POWER 1 Modeled ST Market Purchases $0 $13,664 $13,664 2 Actual ST Market Purchases 50,274 -50,274 0 3 Rocky Reach/Rock Island Purchase 12,044 2,559 14,603 4 Wells - Avista Share 1,772 672 2,444 5 Priest Rapids Project 6,801 813 7,614 6 Douglas Settlement 1,081 -254 827 7 Lancaster Capacity Payment 22,657 889 23,546 8 Lancaster Variable O&M Payments 2,701 210 2,911 9 WNP-3 15,637 -70 15,567 10 Deer Lake-IP&L 8 0 8 11 Small Power 1,362 -147 1,215 12 Stimson 1,856 -85 1,771 13 Spokane-Upriver 3,002 -90 2,912 14 Spokane Waste-to-Energy 5,664 351 6,015 15 Non-Monetary 21 -21 0 16 Ancillary Services 1,823 -1,823 0 17 Palouse Wind 20,525 -20,525 0 18 Total Account 555 147,228 -54,132 93,096 147,227 557 OTHER EXPENSES 19 Broker Commission Fees 411 0 411 20 WA EIA REC Purchase - 100% WA Allocation 437 -437 0 21 REC Expenses (offset to REC Revenue) 51 0 51 22 Rathdrum Solar, Buck-a-Block 1 -1 0 23 Natural Gas Fuel Purchases 66,110 -66,110 0 24 Total Account 557 67,010 -66,548 462 501 THERMAL FUEL EXPENSE 25 Kettle Falls - Wood Fuel 6,318 -471 5,847 26 Kettle Falls - Start-up Gas 14 0 14 27 Colstrip - Coal 22,371 -1,088 21,283 28 Colstrip - Oil 199 0 199 29 Total Account 501 28,902 -1,558 27,344 547 OTHER FUEL EXPENSE 30 Coyote Springs Gas 36,449 -9,749 26,700 31 Coyote Springs 2 Gas Transportation 5,716 679 6,395 32 Lancaster Gas 27,817 -1,154 26,663 33 Lancaster Gas Transportation 4,922 507 5,429 34 Gas Transport Optimization 0 -9,000 -9,000 35 Gas Transportation for BP, NE and KFCT 46 0 46 36 Rathdrum Gas 1,556 3,101 4,657 37 Northeast CT Gas 44 1,003 1,047 38 Boulder Park Gas 528 139 667 39 Kettle Falls CT Gas 122 332 454 40 Total Account 547 77,200 -14,141 63,059 77,200 Exhibit No. 6 Case No. AVU-E-17-01 W. Johnson, Avista Schedule 1, Page 1 of 2 Avista Corp. Power Supply Pro forma - Idaho Jurisdiction System Numbers - 2016 Actual and 2018 Pro Forma Test Year Load Line 2016 2018 No.Actuals Adjustment Pro Forma 565 TRANSMISSION OF ELECTRICITY BY OTHERS 41 WNP-3 943 0 943 42 Short-term Transmission Purchases 38 0 38 43 BPA PTP for Colstrip, Coyote & Lancaster 12,249 145 12,394 44 BPA Townsend-Garrison Wheeling 1,499 9 1,508 45 Avista on BPA - Borderline 1,285 0 1,285 46 Kootenai for Worley 45 0 45 47 Sagle-Northern Lights 134 0 134 48 Northwestern for Colstrip 415 0 415 49 PGE Firm Wheeling 643 0 643 50 Total Account 565 17,251 154 17,405 17,251 536 WATER FOR POWER 51 Headwater Benefits Payments 989 10 999 52 TOTAL EXPENSE 338,580 -136,215 202,365 447 SALES FOR RESALE 53 Modeled Short-Term Market Sales 0 24,478 24,478 54 Actual ST Market Sales - Physical 82,549 -82,549 0 55 PGE Capacity Sale 19,278 -19,278 0 56 Nichols Pumping Sale 953 -21 932 57 Sovereign/Kaiser DES 150 0 150 58 Pend Oreille DES & Spinning 601 0 601 59 Energy America 13,462 -2,582 10,880 60 COB Optimization 0 216 216 61 Intracompany Generation 1,823 -1,823 0 62 Total Account 447 118,816 -81,558 37,258 118,816 456 OTHER ELECTRIC REVENUE 63 Non-WA EIA REC Sales 5,355 -1,851 3,504 64 Gas Not Consumed Sales Revenue 79,528 -79,528 0 65 Total Account 456 84,883 -81,379 3,504 453 SALES OF WATER AND WATER POWER 66 Upstream Storage Revenue 357 16 373 67 TOTAL REVENUE 204,056 -162,921 41,135 68 TOTAL NET EXPENSE 134,524 26,706 161,230 19.85% Exhibit No. 6 Case No. AVU-E-17-01 W. Johnson, Avista Schedule 1, Page 2 of 2 Exhibit No. 6 Case No. AVU-E-17-01 W. Johnson, Avista Schedule 2, Page 1 of 5 Avista Corp. Brief Description of Power Supply Adjustments Line No. 1 Modeled Short-term Market Purchases - Short-term purchases from the AURORA Dispatch Simulation Model. 2 Actual ST Market Purchases – Expense is set to zero since no fixed-price short-term transactions for 2018 are included in the pro forma. 3 Rocky Reach/Rock Island Purchase – The pro forma expense is based on the current contract which ends 12-31-2020. 4 Wells – Avista Share - Wells’ costs are based on the Company's 3.34% share of total project costs. 5 Priest Rapids Project - Priest Rapids Project expense includes the expense related to the purchased power from the Priest Rapids development and power from the Wanapum development. 6 Douglas Settlement – Douglas Settlement is for power Avista purchases from Douglas PUD per the 1989 Settlement Agreement. Contract ends 8-31-18. 7 Lancaster Capacity Payment – The Lancaster capacity payment includes a capital payment and a fixed O&M payment. 8 Lancaster Variable O&M Payments – the Lancaster variable O&M payment is based on the variable O&M rate in the Lancaster Power Purchase Agreement multiplied time the MWh of Lancaster generation in the pro forma. 9 WNP-3 - Pro forma costs are based on the actual rate. The pro forma uses the actual rate for the contract for contract year 2016-2017 escalated at inflation to the pro forma period. 10 Deer Lake-IP&L - Pro forma expense is for power purchased from Inland Power to serve Avista customers. 11 Small Power – Pro forma costs are based on 5-year average generation and an average contract rate. 12 Stimson – This purchase is from the cogeneration plant at Plummer, Idaho. Pro forma costs are based on 5-year average generation and pro forma period contract rates. Exhibit No. 6 Case No. AVU-E-17-01 W. Johnson, Avista Schedule 2, Page 2 of 5 13 Spokane-Upriver – Pro forma expense is based on a purchase of the net of pumping (at the plant) generation at the pro forma contract rate. 14 Spokane Waste-to-Energy - Pro forma expense is based on average generation and the pro forma period contract rate. 15 Non-Monetary - Expense is normalized to $0 in the pro forma. 16 Ancillary Services – Pro forma expense is $0 because this is an intra-utility expense (matching revenue in Account 447). 17 Palouse Wind – Palouse Wind generation and expense is not included in the pro forma. Avista is proposing to flow the net cost through the PCA in this case. 18 Total Account 555 19 Broker Commission Fees – Pro forma expense is associated with purchases and sales of electricity and natural gas fuel. 20 WA EIA REC Purchases – Pro forma expense is $0 because this is a Washington only expense. 21 REC Expense – Expenses associated with the Non-WA EIA REC Sales revenue. 22 Rathdrum Solar, Buck a Block – This is the value of the energy from the Rathdrum Solar project for which Buck a Block pays the expense. 23 Natural Gas Fuel Purchases – This is the expense for natural gas purchased but not consumed for generation. Pro forma expense is $0 because all gas purchased is assumed to be used for generation, and included in Account 547. 24 Total Account 557 25 Kettle Falls Wood Fuel Cost – Pro forma fuel expense is based on the generation of the Kettle Falls plant in the AURORA Model and the unit cost of available fuel. 26 Kettle Falls-Start-up Gas – Pro forma expense is for start-up gas at Kettle Falls and is based on the test-year expense. 27 Colstrip Coal Cost – Pro forma fuel expense is based on the generation of the Colstrip plant in the AURORA Model and the unit cost of fuel under the contract. Exhibit No. 6 Case No. AVU-E-17-01 W. Johnson, Avista Schedule 2, Page 3 of 5 28 Colstrip Oil – Pro forma expense is for start-up oil expense. Pro forma is based on the test-year expense. 29 Total Account 501 30 Coyote Springs Gas – Pro forma expense is an output of the AURORA Model based on the pro forma unit cost of fuel and the dispatch of the plant, which determines the volume of fuel consumed. 31 CS2 Gas Transportation – This expense is for natural gas transportation for the Coyote Springs 2 plant. 32 Lancaster Gas - Pro forma expense is an output of the AURORA Model based on the pro forma unit cost of fuel and the dispatch of the plant, which determines the volume of fuel consumed. 33 Lancaster Gas Transportation – This expense is for natural gas transportation for the Lancaster plant. 34 Gas Transportation Optimization - This credit to expense is based on optimizing the gas transportation contracts for Coyote Springs 2 and Lancaster. In general, this involves trading the gas price spread between AECO (Canada) and Malin. 35 Gas Transportation for BP, NE and KFCT – This expense is for transportation of natural gas to serve Boulder Park, Northeast and Kettle Falls Combustion Turbine gas-fired plants. 36 Rathdrum Gas – Pro forma expense is an output of the AURORA Model based on the pro forma unit cost of fuel and the dispatch of the plant, which determines the volume of fuel consumed. 37 Northeast CT Gas – Pro forma expense is an output of the AURORA Model based on the pro forma unit cost of fuel and the dispatch of the plant which determines the volume of fuel consumed. 38 Boulder Park Gas – Pro forma expense is an output of the AURORA Model based on the pro forma unit cost of fuel and the dispatch of the plant which determines the volume of fuel consumed. 39 Kettle Falls CT Gas – Pro forma expense is an output of the AURORA Model based on the pro forma unit cost of fuel and the dispatch of the plant, which determines the volume of fuel consumed. Exhibit No. 6 Case No. AVU-E-17-01 W. Johnson, Avista Schedule 2, Page 4 of 5 40 Total Account 547 41 WNP-3 Transmission – Pro forma WNP-3 wheeling is based on 32.22 MW at the BPA tariff rate. 42 Wheeling for System Sales and Purchases – Pro forma expense is for short- term transmission purchases. 43 PTP for Colstrip and Coyotes Springs 2 and Lancaster– Pro forma expense is based on 577 MW of capacity at the BPA tariff rate. 44 BPA Townsend-Garrison Wheeling – This expense is for the transmission of Colstrip power from the Townsend substation to the Garrison substation. 45 Avista on BPA Borderline – This expense is to serve Avista load off of BPA transmission. Expense is based on Avista’s borderline loads priced at BPA’s NT transmission rates plus ancillary services cost and use of facilities charges. 46 Kootenai for Worley – This expense is for Avista load served using Kootenai’s facilities. 47 Sagle-Northern Lights – Expense is for transmission purchased from Northern Lights Utility to serve Avista customers. 48 Northwestern for Colstrip – Northwestern for Colstrip wheeling is an expense for the transmission of Colstrip energy above 196 MW from the Garrison substation over Northwestern Energy’s transmission system to the interconnection of Northwestern Energy and Avista. 49 PGE Firm Wheeling – PGE Firm wheeling reflects the cost of transmission from the John Day substation to COB (Intertie South) purchased from Portland General Electric. 50 Total Account 565 51 Headwater Benefits Expense - Pro forma expense is based on the expense for contract year September 2016 through August 2017. 52 Total Expenses – Sum of Accounts 555, 557, 501, 547, 565, and 536. 53 Modeled Short-Term Market Sales - Short-term market sales from the AURORA Model simulation. 54 Actual ST Market Sales - Physical – Revenue is zero because no fixed-price short-term transactions for 2018 are included in the pro forma. Exhibit No. 6 Case No. AVU-E-17-01 W. Johnson, Avista Schedule 2, Page 5 of 5 55 PGE Capacity Sale – This pro forma revenue is $0 because the contract ended 12-31-16. 56 Nichols Pumping Sale – This is a sale of energy to other Colstrip Units 3 and 4 owners at the Mid-Columbia index price less $2.16/MWh. 57 Sovereign/Kaiser DES – This contract provides load control services to Kaiser’s Trentwood plant. 58 Pend Oreille DES & Spinning Reserves – This contract provides load regulation and reserves for Pend Oreille PUD. 59 Energy America –Pro forma revenue includes a 50 aMW sale of energy at the Mid C index plus $3/MWh. 60 COB Optimization – Pro forma revenue is based on the COB minus Mid C price spread in the AURORA model. 61 Intercompany Generation – Pro forma revenue is $0 because it is intra- utility revenue (matching expense in Account 555). 62 Total Account 447 63 Non WA EIA REC Sales – This is the expected REC revenue in the pro forma period. 64 Gas Not Consumed Sales Revenue - This is the revenue for natural gas purchased but not consumed for generation. Pro forma revenue is $0 because all gas purchased is assumed to be used for generation, and included in Account 547. 65 Total Account 456 66 Upstream Storage Revenue – Pro forma revenue is based on the revenue for contract year September 2016 through August 2017. 67 Total Revenue – Sum of Accounts 447, 456, 453 and 454. 68 Total Net Expense – Total expense minus total revenue. Avista Corp. Market Purchases and Sales, Plant Generation and Fuel Cost Summary Idaho Normalized January 2016 - December 2016 744 672 743 720 744 720 744 744 720 744 721 744 Total Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Market Sales - Dollars -$24,478,019 -$2,394,637 -$709,495 -$928,860 -$2,022,807 -$1,770,610 -$1,719,932 -$3,557,273 -$1,574,382 -$1,759,662 -$1,220,613 -$2,459,419 -$4,360,329 Market Sales - MWh (1,039,646) -72,743 -25,093 -37,731 -108,954 -122,860 -122,751 -136,282 -52,802 -66,795 -53,586 -98,466 -141,584Average Market Sales Price -$/ MWh $23.54 $32.92 $28.27 $24.62 $18.57 $14.41 $14.01 $26.10 $29.82 $26.34 $22.78 $24.98 $30.80 Market Purchases - Dollars $13,663,648 $914,909 $2,152,343 $1,884,759 $446,451 $152,489 $387,116 $1,127,058 $2,183,389 $1,449,014 $1,488,780 $797,738 $679,602 Market Purchases - MWh 654,162 39,595 97,317 93,981 31,865 12,131 20,977 60,571 100,302 66,188 71,401 32,462 27,371Average Market Purchase Price - $/MWh $20.89 $23.11 $22.12 $20.05 $14.01 $12.57 $18.61 $21.77 $21.89 $20.85 $24.57 $24.83 Net Market Purchases (Sales) MWh -385,484 -33,148 72,224 56,250 -77,089 -110,729 -101,774 -75,711 47,500 -607 17,816 -66,004 -114,213Net Market Purchases (Sales) aMW -44.0 -45 107 76 -107 -149 -141 -102 64 -1 24 -92 -154 Average Sale and Purchase Price - $/MWh $22.52 $29.46 $23.38 $21.36 $17.54 $14.25 $14.66 $23.80 $24.54 $24.13 $21.68 $24.88 $29.83 Colstrip MWh 1,344,235 141,970 119,622 126,114 75,555 57,925 61,333 114,739 125,202 127,048 123,723 129,234 141,772 Colstrip Fuel Cost $/MWh $15.83 $14.31 $15.35 $15.06 $19.42 $22.27 $21.47 $15.76 $15.11 $15.00 $15.22 $14.87 $14.32Colstrip Fuel Cost $21,283,185 $2,031,964 $1,835,611 $1,899,687 $1,467,454 $1,290,025 $1,316,983 $1,807,794 $1,891,545 $1,906,131 $1,883,288 $1,922,270 $2,030,433 Kettle Falls MWh 299,213 33,853 29,840 29,582 26,250 11,970 575 18,723 26,607 29,051 29,990 30,070 32,700Kettle Falls Fuel Cost $/MWh $19.54 $19.53 $19.53 $19.54 $19.58 $19.66 $19.56 $19.53 $19.53 $19.53 $19.53 $19.53 Kettle Falls Fuel Cost $5,847,422 $661,033 $582,932 $578,041 $514,044 $235,364 $11,300 $366,229 $519,616 $567,329 $585,796 $587,199 $638,538 Coyote Springs MWh 1,397,126 169,290 102,704 92,264 68,732 32,292 34,355 121,668 152,813 144,964 142,307 150,500 185,236 Coyote Springs Fuel Cost $/MWh $19.11 $23.11 $22.54 $21.54 $16.85 $16.55 $16.77 $17.16 $17.28 $17.14 $17.38 $18.79 $19.99Coyote Springs Fuel Cost $26,700,000 $3,912,119 $2,314,468 $1,987,675 $1,158,433 $534,563 $576,046 $2,087,704 $2,639,966 $2,485,321 $2,473,370 $2,827,875 $3,702,460 Lancaster MWh 1,365,537 161,240 110,522 105,119 83,290 39,991 34,555 107,350 134,165 134,844 140,051 142,857 171,554 Lancaster Fuel Cost $/MWh $19.53 $23.16 $22.96 $22.00 $17.19 $17.52 $17.82 $18.11 $18.09 $17.46 $17.55 $19.01 $20.00 Lancaster Fuel Cost $26,662,839 $3,733,643 $2,537,615 $2,312,867 $1,431,422 $700,757 $615,732 $1,944,529 $2,427,497 $2,354,925 $2,458,583 $2,715,017 $3,430,251 Boulder Park MWh 26,914 2,671 1,380 1,143 723 687 1,373 3,977 4,581 2,668 2,107 1,989 3,615Boulder Park Fuel Cost $/MWh $24.78 $30.37 $29.89 $28.84 $22.32 $21.97 $22.49 $22.86 $23.04 $22.69 $22.91 $24.86 $26.23 Boulder Park Fuel Cost $666,979 $81,111 $41,238 $32,983 $16,144 $15,090 $30,889 $90,894 $105,538 $60,545 $48,275 $49,438 $94,834 Kettle Falls CT MWh 18,961 1,744 862 652 411 428 878 2,279 2,877 2,231 1,984 1,994 2,621 Kettle Falls CT Fuel Cost $/MWh $23.97 $29.43 $28.98 $27.87 $21.68 $21.29 $21.69 $22.16 $22.33 $22.10 $22.25 $24.11 $25.41Kettle Falls CT Fuel Cost $454,426 $51,308 $24,971 $18,178 $8,914 $9,119 $19,033 $50,502 $64,262 $49,315 $44,128 $48,076 $66,621 Rathdrum MWh 133,761 6,269 805 98 293 880 5,515 23,578 31,002 18,769 14,136 12,918 19,498Rathdrum Fuel Cost $/MWh $34.82 $38.66 $37.66 $35.82 $28.53 $40.68 $39.35 $38.47 $38.64 $28.97 $29.14 $31.64 $33.38 Rathdrum Fuel Cost $4,657,239 $242,317 $30,328 $3,508 $8,351 $35,815 $216,995 $906,959 $1,197,960 $543,636 $411,873 $408,711 $650,787 Northeast MWh 30,811 467 12 19 57 140 1,094 5,687 7,176 4,795 3,959 3,608 3,796 Northeast Fuel Cost $/MWh $33.98 $43.74 $41.37 $40.40 $32.13 $31.67 $32.37 $32.85 $33.10 $32.76 $32.90 $35.66 $37.77Northeast Fuel Cost $1,047,059 $20,442 $480 $769 $1,823 $4,425 $35,428 $186,814 $237,486 $157,124 $130,261 $128,657 $143,351 Total Fuel Expense $87,319,148 $10,733,937 $7,367,643 $6,833,709 $4,606,584 $2,825,159 $2,822,406 $7,441,424 $9,083,869 $8,124,325 $8,035,573 $8,687,242 $10,757,275 Net Fuel and Purchase Expense $76,504,777 Exhibit No. 6 Case No. AVU-E-17-01 W. Johnson, Avista Schedule 3, Page 1 of 1 Avista Corp Pro forma January 2018 - December 2018 PCA Authorized Expense and Retail Sales 2016 Normalized Loads PCA Authorized Power Supply Expense - System Numbers (1) Total January February March April May June July August September October November December Account 555 - Purchased Power $93,098,141 $9,702,833 $10,328,500 $8,924,403 $7,339,924 $5,493,489 $5,495,060 $6,450,838 $7,374,829 $6,454,510 $6,678,058 $9,322,263 $9,533,434 Account 501 - Thermal Fuel $27,343,606 $2,710,748 $2,436,293 $2,495,479 $1,999,248 $1,543,139 $1,346,033 $2,191,772 $2,428,911 $2,491,210 $2,486,834 $2,527,218 $2,686,722 Account 547 - Natural Gas Fuel $63,059,053 $8,280,148 $5,188,309 $4,595,190 $2,864,296 $1,538,980 $1,733,333 $5,506,611 $6,911,918 $5,890,075 $5,805,698 $6,416,983 $8,327,513 Account 447 - Sale for Resale $37,257,163 $3,781,357 $1,822,086 $2,040,710 $2,860,479 $2,523,088 $2,502,706 $4,670,615 $2,827,345 $2,878,367 $2,286,265 $3,502,619 $5,561,524 Power Supply Expense $146,243,638 $16,912,372 $16,131,016 $13,974,362 $9,342,988 $6,052,520 $6,071,720 $9,478,606 $13,888,313 $11,957,427 $12,684,325 $14,763,845 $14,986,145 Transmission Expense $17,404,447 $1,367,136 $1,600,335 $1,468,739 $1,449,915 $1,423,359 $1,415,703 $1,470,703 $1,461,595 $1,427,130 $1,424,958 $1,434,978 $1,459,896 Transmission Revenue $15,149,485 $1,062,694 $1,178,481 $1,177,115 $1,141,305 $1,253,488 $1,398,529 $1,450,378 $1,346,819 $1,372,213 $1,319,316 $1,257,650 $1,191,496 Net REC Revenue $3,453,000 $293,350 $264,550 $293,350 $283,750 $293,350 $283,750 $293,350 $293,350 $283,750 $293,350 $283,750 $293,350 $145,045,600 PCA Authorized Idaho Retail Sales (2) Total January February March April May June July August September October November December Total Retail Sales, MWh (2)2,953,031 294,914 261,971 251,422 228,917 211,441 204,736 252,026 245,232 206,024 240,501 257,717 298,131 2018 Load Change Adjustment Rate $24.89 /MWh 2019 Load Change Adjustment Rate $25.34 /MWh 1) Multiply system numbers by 34.27% to determine Idaho share. 2) 12 months ended December 2016 weather normalized Idaho retail sales, with a pro forma adjustment, as explained by Mr. Kalich. Exhibit No. 6 Case No. AVU-E-17-01 W. Johnson, Avista Schedule 4, Page 1 of 1