Idaho Public Utilities Commission

Case No. IPC-E-10-23

October 22, 2010

Contact: Gene Fadness (208) 334-0339, 890-2712

Website: www.puc.idaho.gov

 

Idaho Power seeks means to be able to serve more large-load customers

 

Idaho Power Company says that without adding new transmission and generation it cannot accommodate potentially 75 new large industrial and irrigation customers that want to receive power from the southern Idaho utility.

 

In order to be able to serve those customers without adding new generation and transmission the utility is asking the Idaho Public Utilities Commission for authority to reduce the upper limit on the size of customers that can qualify for “special contract” status. The commission is taking comments through Nov. 12 on the Idaho Power request.

 

All but four of Idaho Power’s largest customers are served under a tariff schedule, called Schedule 19 that has the same rates and delivery requirements for all Schedule 19 customers. However, customers that have an aggregate load of 25,000 kilowatts or more (25 megawatts) have a special contract with Idaho Power that gives the utility price and delivery flexibility to accommodate the requirements of large load customers without negatively impacting other customers. The four special contracts customers are Micron, the Idaho National Laboratory, JR Simplot Company and Hoku Materials.

 

In this application, Idaho Power seeks to decrease the upper limit of customers that can qualify for special contract provisions from 25 MW to 20 MW, allowing the utility to be able to serve more large-load customers without unduly constraining the system.

 

A special contract would, for example, allow Idaho Power and the large customer to reach an agreement to curtail power or exercise other options to the large customer if Idaho Power is unable to provide service. Further, a special contract could mitigate the rate impact on existing customers with a rate structure that could include a marginal cost component for an initial term in the service agreement. The contract could also require the large customer to make upfront contributions for new or upgraded distribution or transmission needed to serve the new customer.

 

Because of constraints on its power supply and transmission, Idaho Power would not have been able to serve Hoku Materials, Inc., a new polysilicon production facility in Pocatello, without a special contract. Hoku requested 82 megawatts of year-round capacity. The two entities last year agreed on a four-year seasonally-shaped contract that requires Hoku to reduce its demand during the peak summer months through 2012, the year Idaho Power expects to have enough power supply and transmission to serve Hoku at full capacity. During those peak months, Hoku will reduce its demand by performing annual maintenance on its systems.

 

The agreement also allowed Idaho Power to charge Hoku a special rate rather than the standard rate for the entire load, which would have likely placed upward pressure on all of Idaho Power’s customer rates. Hoku is paying the costs for Idaho Power to build the transmission and substation upgraded needed to enable delivery of energy to Hoku’s facilities.

 

The commission plans to handle this request in a modified procedure that uses written comments rather than conducting a hearing, unless customer comments can demonstrate a need for a public hearing. Comments are accepted through Nov. 12 via e-mail by accessing the commission’s homepage at www.puc.idaho.gov and clicking on "Comments & Questions About a Case." Fill in the case number (IPC-E-10-23) and enter your comments. Comments can also be mailed to P.O. Box 83720, Boise, ID 83720-0074 or faxed to (208) 334-3762. 

 

A full text of the commission’s order, along with other documents related to this case, is available on the commission’s Web site at www.puc.idaho.gov. Click on “File Room” and then on “Electric Cases” and scroll down to the above case number.