20100929notice_of_filing_order_no_32074.pdf

Office of the Secretary
Service Date
September 29, 2010
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF INTERMOUNTAIN
GAS COMPANY'S 2011-2015 INTEGRATED
RESOURCE PLAN
NOTICE OF FILING
CASE NO. INT-10-
NOTICE OF
MODIFIED PROCEDURE
ORDER NO. 32074
YOU ARE HEREBY NOTIFIED that on August 31 , 2010, Intennountain Gas
Company (Intennountain or Company) filed its Integrated Resource Plan (IRP) for the years
2011-2015. The Company filed its IRP pursuant to the requirements of Commission Order No.
25342 and Section 303(b )(3) of the Public Utility Regulatory Policies Act (PURP A).
Intennountain is the sole distributor of natural gas in southern Idaho. Its service area covers
approximately 50 000 square miles containing a population of approximately 1 million. During
the first half of 2009, the Company served approximately 305 000 customers in 74 communities
through a system of over 10 000 miles of transmission, distribution and service lines. The
Company added 120 miles of distribution and 2 883 service lines to accommodate new
customers and maintain service for the Company s growing customer base.
THE INTEGRATED RESOURCE PLAN
YOU ARE FURTHER NOTIFIED that Intennountain provides natural gas sales to
two major markets: the residential and commercial market and the industrial market. During
2009, the Company served an average of 275 522 residential and 29 673 commercial customers
which equates to an increase in average residential and commercial customers of 1.1 % from
2008. Residential and commercial customers use natural gas primarily for space and water
heating. Intennountain s industrial customers use natural gas supplied by the company for boiler
and manufacturing applications. The IRP states that industrial demand for natural gas is strongly
influenced by the agricultural economy and the price of alternative fuels. During 2009 41.2% of
the throughput on Intennountain s system was attributable to industrial sales and transportation.
YOU ARE FURTHER NOTIFIED that the IRP states that the Company s peak day
loads (throughput during the projected coldest winter day) are growing at a manageable rate.
NOTICE OF FILING
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 32074
The growth in the Company s projected peak day load is attributable to (1) growth in
Intennountain s customer base, primarily residential and commercial, and (2) production-related
growth occurring in the Company s industrial finn transportation market.
Forecast Peak Day Send-Out
YOU ARE FURTHER NOTIFIED that the Company analyzed several peak day
send-out (delivery) studies to detennine the magnitude and timing of future deficiencies in finn
peak day delivery capabilities, looking at both a total interstate mainline perspective as well as
geographic region specific perspectives. Residential, commercial, and industrial customer peak
day load send-out was matched against available resources to detennine which combination of
new resources would be needed to meet the Company s future peak day delivery requirements in
the most cost-effective manner. IRP, p. 6. The Company estimates that residential, commercial
and industrial peak day load growth over the five-year period will increase at an average annual
rate of 1.75% under a base case scenario. The IRP indicates that there are no peak day delivery
deficits when forecasted peak day send-out is matched against existing resources. IRP, p. 7.
Regional Studies
YOU ARE FURTHER NOTIFIED that the IRP analyzes certain geographic regions
within Intennountain' s service territory based upon the anticipated or known need for
distribution system upgrades within each specific region. The geographic regions are identified
as the Idaho Falls Lateral Region, the Sun Valley Lateral Region, the Canyon County Region
the State Street Lateral Region and an All Other Region. The Idaho Falls Lateral is 104 miles in
length and serves a number of cities between Pocatello and St. Anthony in eastern Idaho. The
residential, commercial, and industrial load served off the Idaho Falls Lateral represents
approximately 15% of the total Company customers and 19% of the Company s total winter
send-out during December 2009. IRP, p. 7. The IRP identified a peak day delivery deficit for
the Idaho Falls Lateral that occurs during 2011 and increases in each of the next four years.
Some of the industrial customers in the Idaho Falls Lateral have the ability to mitigate peak day
consumption by switching to fuel oil during extremely cold temperatures. Intennountain
believes that small, short-duration peak day distribution delivery deficits in the future can be
mitigated by working with these customers to facilitate the use of fuel oil at the customers
facilities. In addition, the IRP states that peak day delivery deficits can be managed by bringing
on gas from the new Rexburg LNG facility.
NOTICE OF FILING
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 32074
YOU ARE FURTHER NOTIFIED that the residential, commercial, and industrial
customers served off the Sun Valley Lateral represent approximately 4% of the total customers
and 4% of the Company s total winter send-out during December 2009. When forecasted peak
day send-out on the Sun Valley Lateral is matched against existing capacity, a peak day delivery
deficit occurs during 2011 and slightly increases during each of next four years. The IRP states
that the growth along the Sun Valley Lateral will require a future upgrade to the existing pipeline
system. The IRP states that the Company plans to increase the delivery capability on the Sun
Valley Lateral using a series of cost-effective system upgrades beginning in 2011.
YOU ARE FURTHER NOTIFIED that the Canyon County Lateral represents
approximately 14% of the total Company customers and 13% of the Company s total winter
send-out during December 2009. The IRP states that a matching of the existing peak day
distribution with anticipated demand shows that there are no peak day delivery deficits during
2011-2015.
YOU ARE FURTHER NOTIFIED that the State Street Lateral is identified for the
first time in the 2010 IRP. The IRP states that there is currently no threat of capacity constraint
in the State Street Lateral, but that the Company is monitoring it as demand is beginning to
approach design capacity. During the 2011-2015 timeframe, the IRP states there are no capacity
constraints for the State Street Lateral.
Assessment of Potential DSM Programs
YOU ARE FURTHER NOTIFIED that the IRP states that, in addition to reviewing
traditional and non-traditional resource alternatives, Intennountain also analyzed potential
demand-side management (DSM) measures to mitigate potential constraint areas. Specifically,
the Company evaluated two different programs: the continuation of its $200 rebate to customers
who install a 90% or greater efficiency natural gas furnace when converting to natural gas, and
(2) a $30 rebate when a customer installs a .64 or greater energy factor gas water heater at the
time of conversion.
YOU ARE FURTHER NOTIFIED that the IRP analyzed residential, commercial and
industrial customer growth and its impact on Intennountain' s distribution system using design
weather conditions under various scenarios for Idaho s economy. Peak day send-out under each
of these customer growth scenarios was measured against the available natural gas delivery
systems to project the magnitude and timing of delivery deficits, both from a total Company
NOTICE OF FILING
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 32074
perspective as well as a regional perspective. The resources needed to meet the projected deficits
were analyzed within a framework of options, including DSM measures, to help detennine the
most cost-effective means to manage the potential deficits.
YOU ARE FURTHER NOTIFIED that the IRP is a planning document for the
Company to analyze numerous factors and variables that affect the supply and demand for
natural gas in the next few years. The Executive Summary of the IRP identifies the purpose of
the plan as "to describe the currently anticipated conditions over the five year planning horizon
the anticipated resource selections and the process for making resource decisions." IRP, p. 5.
The Commission will review Intennountain s IRP to ensure that it represents a diligent effort by
the Company to plan for anticipated supply and demand for natural gas during 2011-2015. The
Commission s acceptance of the IRP does not constitute approval of plan specifics or of any
transaction undertaken as part of the plan.
NOTICE OF MODIFIED PROCEDURE
YOU ARE FURTHER NOTIFIED that the Commission has detennined that the
public interest may not require a fonnal evidentiary hearing in this matter and will proceed under
Modified Procedure pursuant to the Commission s Rules of Procedure 201 through 204, IDAPA
31.01.01.201 through .204. The Commission notes that Modified Procedure (with written
comments) has proven to be an effective means for obtaining public input and participation in
cases of this nature.
YOU ARE FURTHER NOTIFIED that any person desiring to state a position on
Intennountain s IRP may file a written comment in support or opposition with the Commission
no later than sixty (60) days from the date of this Order. The comment must contain a statement
of reasons supporting the comment. Persons desiring a hearing must specifically request a
hearing in their written comments. Written comments concerning Intennountain s IRP shall be
mailed to the Commission and Intennountain Gas at the addresses reflected below:
Commission Secretary
Idaho Public Utilities Commission
PO Box 83720
Boise, ID 83720-0074
Street Address for Express Mail:
Katherine J. Barnard, Manager
Gas Supply and Regulatory Affairs
Intennountain Gas Company
555 South Cole Road
PO Box 7608
Boise, ID 83707
472 W. Washington Street
Boise, ID 83702-5918
NOTICE OF FILING
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 32074
These comments should contain the case caption and case number shown on the first page of this
document.Persons desiring to submit comments via e-mail may do so by accessing the
Commission s home page located at www.puc.idaho.gov. Click the "Comments and Questions
icon, and complete the fonn, using the case number as it appears on the front of this document.
YOU ARE FURTHER NOTIFIED that if no written comments or protests are
received within the time limit set, the Commission may consider the matter on its merits and may
enter its Order without a fonnal hearing. If written comments or protests are received within the
deadline, the Commission will consider them and, in its discretion, may set the matter for hearing
or may decide the matter and issue its Order based on the written comments before it. IDAP
31.01.01.204.
YOU ARE FURTHER NOTIFIED that Intennountain s IRP has been filed with the
Commission and is available for public inspection during regular business hours at the
Commission offices or on the Commission s website at www.puc.idaho.gov under "File Room
and then "Gas Cases.
YOU ARE FURTHER NOTIFIED that all proceedings in this matter will be held
pursuant to the Commission s jurisdiction under Title 61 ofthe Idaho Code.
ORDER
IT IS HEREBY ORDERED that this case be processed under Modified Procedure.
Interested persons may file written comments no later than sixty (60) days from the service date
of this Order.
NOTICE OF FILING
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 32074
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 2?
f(.
day of September 20 I dL~
MD. KEMPTO , PRE DENT
L1~
MARSHA H. SMITH, COMMISSIONER
MACK A. REDFORD, COMMISSIONER
ATTEST:
Commission Secretary
bls/O:INT-IO-O4 ws
NOTICE OF FILING
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 32074