Idaho Energy Update
July 23, 2009
The Idaho Public Utilities Commission held its three-day technical hearing last week on Idaho Power’s proposed $427 million natural gas plant at New Plymouth. And Idaho Power is asking the PUC to approve contracts with three new wind farms, while the PUC has approved an Avista rate increase and Rocky Mountain Power is proposing a new way to adjust costs for its power costs.
For more on these developments and others, please read on.
Thanks as always, and if you have any calendar items, please send them along!
Clean Energy Program Director
Snake River Alliance
I: PUC’s Langley Gulch Hearing Spans Three Days
The Public Utilities Commission’s technical hearing on Idaho Power’s application for a certificate for its proposed Langley Gulch natural gas plant near New Plymouth required most of the allotted three days last week.
Commissioners are not expected to announce a decision on whether to grant the Certificate of Public Convenience and Necessity until well into August, probably after Idaho Power completes its annual sales and load growth forecast. Idaho Power has said it wants a decision by Sept. 1 in order to avoid penalties on the deposits it has made to the turbine manufacturer.
The company says the 330MW, $427 million gas plant would serve both base load energy requirements year-round, as well as short-term “peaking” electricity needs during high summertime demand as a result of air-conditioning and irrigation pumping. Company witnesses testified Tuesday on their position that the gas plant is critical for the utility to meet its energy supply requirements by 2012 and beyond. Other parties in the case challenged both the power-supply needs and the manner in which Idaho Power handled the request for proposal and bidding process for the project. Idaho Power selected an in-house proposal as the winning bid, saying it came in $95 million below the next cheapest bid.
The Commission will also accept written comments on the project through Friday, 24. The PUC says written comments are given the same weight as oral testimony at the public hearing, and can be e-mailed by going to www.puc.idaho.gov and clicking “Comments and Questions” and filling in the case number, IPC-E-09-03. They can also be mailed to P.O. Box 83720, Boise, ID 83720-0074 or faxed to (208) 334-3762.
For more information on the application and to review filings by Idaho Power and other parties, go to www.puc.idaho.gov and then to “File Room” and then “Electric Cases” and scroll down to IPC-E-09-03.
II: Idaho Power Files PUC Paperwork for 3 New Wind Farms
Idaho Power has filed applications to the Public Utilities Commission for approval of contracts to buy power from three proposed southern Idaho wind farms. The three projects are being developed by Montana-based Exergy Development Group, which developed Idaho’s first commercial wind farm near Hagerman and which maintains a Boise office.
The three projects – Camp Reed Wind Park, Yahoo Creek Wind Park, and Payne’s Ferry Wind Park – would be built in the vicinity of the Fossil Gulch wind park, also built by Exergy near Hagerman. Each of the wind farms would have a “nameplate” or maximum capacity of 21-22MW, and each is expected to deliver no more than 10 average megawatts on a monthly basis. The 10MW threshold is the maximum that can be allowed under Idaho’s provisions of the federal Public Utilities Regulatory Policies Act of 1978. The company would take any electricity above the 10MW limit, but would not pay for it. The contracts call for the wind farms to begin delivering power to Idaho Power by Sept. 30, 2010.
In related news, the Idaho Department of Commerce reported recently that Exergy plans to start building another 14 wind parks across southern Idaho, including Elmore, Cassia, Lincoln and Bingham counties. The Department said those projects and their 152 turbines would produce 228MW of power, create 275 jobs during construction, and 22 permanent jobs once completed sometime in 2010.
To review the Idaho Power requests go to www.puc.idaho.gov and then “File Room” and then “Electric Cases” and then cases IPC-E-09-18, IPC-E-09-19, and IPC-E-09-20.
III: Idaho PUC OKs Avista Rate Case Agreement
The Idaho Public Utilities Commission has adopted an Avista Utilities rate case settlement reached between the Spokane-based utility and several parties that participated in the case. The Avista rate case was among the most contentious utility rate cases in recent year, with residential customers protesting the size of the proposed rate hike – 12.8 percent – as well as issue of company salaries. Avista had sought an increase in its electric revenue of $31.2 million; the settlement provides an increase of $12.5 million, according to a PUC news release.
The PUC approved a base electric rate increase of 5.7 percent. But a related reduction in Avista’s annual Power Cost Adjustment (PCA) of 4.2 percent lead to a net increase to all customer classes of 1.5 percent, or about $1 dollar a month, according to the release. A customer who uses 1,000 kilowatt hours a month would see a bill rising to about $81. A companion rate filing for Avista’s natural gas side led to a gas bill increase of about 91 cents, bringing a typical gas bill to about $74.
To review the settlement and other case files, go to www.puc.idaho.gov and then “File Room” and “Electric Cases” and case AVU-E-09-01.
IV: Rocky Mountain Power Seeks New Power Cost Mechanism
Rocky Mountain Power, the PacifiCorp subsidiary in eastern Idaho, has proposed a new mechanism to the Public Utilities Commission to adjust customer rates to reflect changes in the utility’s power costs each year.
The utility’s proposal is similar to Idaho Power’s and Avista’s annual “power cost adjustment” in which that utility comes before the PUC to either recover unexpected costs of providing power, or to lower customer rates for such things as more favorable hydropower conditions. Rocky Mountain’s proposal is called the Energy Cost Adjustment Mechanism (ECAM). According to the PUC, Rocky Mountain’s proposal comes after a settlement between the utility, PUC staff, Monsanto Co., and the Idaho Irrigation Pumpers Association.
The primary power costs include the expenses the utility must deal with to generate power or purchase power from the markets. While those costs are dealt with in each rate case, they are projections and must be adjusted after the true costs are determined. Customers would receive a credit in years when projected power costs were higher than the true costs, and they would face a surcharge on their bills if the power generation costs more than anticipated. An example would be whether gas prices were higher or lower than expected.
The PUC is taking public comment on this case through Aug. 14. Comments can be submitted electronically off the PUC’s website, listed below, or by mail at P.O. Box 83720, Boise, ID 83720-0074, or faxed to (208) 334-3762. Please reference the case number below.
To learn more about the proposal, go to www.puc.idaho.gov and then to “File Room” and then “Electric Cases” and then “PAC-E-08-08.
On The Agenda:
► The Public Utilities Commission holds its next decision meetings on July 27 and Aug. 3, 10, and 17. Agendas are normally posted the day before on the Commission’s website at www.puc.state.id.us. The meetings typically start at 1:30 p.m.