Idaho Power’s Langley Gulch Power Plant Challenged

BOISE, Idaho--(BUSINESS WIRE)--An unprecedented coalition of intervenor groups has asked the Idaho Public Utility Commission to suspend for ten months its consideration of Idaho Power Company’s request for pre-approved rate recovery of its proposed 300-megawatt Langley Gulch Power Plant.

“… casts a cloud of uncertainty over whether the plant will fit into the plan of reduced greenhouse gases and ultimately even if Langley Gulch will be built.”

The groups, who filed their request on May 29^th, assert that “significant and unforeseen events have taken place since Idaho Power initially filed its Application [for rate recovery]. Any single one of these events,” the groups argue, “would be sufficient cause… to seek to slow down the Company’s forced march to seek Commission action on its request for a Certificate of Public Convenience and Necessity (CPCN)…” The groups argue that since “the Langley Gulch power plant will be the single largest capital investment made by Idaho Power since the Hells Canyon Complex was constructed 50 years ago” and given that the utility seeks an expedited decision on what the intervenors call the “edge of great uncertainty,” a suspension of the current CPCN docket for Langley Gulch is warranted.

The coalition members represent a broad spectrum of utility stakeholder interests and all are intervenors in the Langley Gulch CPCN proceeding. The group includes representatives of the utility’s largest customers: the Industrial Customers of Idaho Power and the Idaho Irrigation Pumpers Association; two of the state’s leading environmental groups, the Snake River Alliance and the Idaho Conservation League; and the region’s advocate for non-utility, independent power producers, the Northwest & Intermountain Power Producers Coalition (NIPPC).

The intervenor coalition, in seeking a Stay in the CPCN proceedings, lists policy concerns ranging from recently expressed shareholder concerns with Idaho Power’s mix of power resources, to the recession, which has put a serious dent in the Company’s need for power.

“All the intervenor stakeholders in this docket believe that the Commission should exercise ‘extreme caution’ before reaching a decision on Langley Gulch,” explains Peter Richardson, attorney for the Industrial Customers of Idaho Power. “The Commission’s expedited review of Idaho Power’s CPCN Application is 180 degrees from where we need to be. In proposing a ‘Stay’ in the proceedings, we hope to convince the Commission to call a time out and direct the Company to reconcile recent events with its insistence that Langley Gulch is urgently needed.”

The groups’ pleading opens with reference to the May 21^st vote by a majority of IDACORP, Inc. (NYSE: IDA) shareholders that requires the Company to develop a plan for Idaho Power which will reduce its emissions of greenhouse gases. The coalition maintains that the recent shareholder vote was a significant new event which “… casts a cloud of uncertainty over whether the plant will fit into the plan of reduced greenhouse gases and ultimately even if Langley Gulch will be built.”

The May 29^thfiling by the intervenor coalition cites Idaho Power’s suspension of its Integrated Resource Plan (IRP) process last Spring – just before filing its CPCN Application for Langley Gulch – as further justification for the Commission to suspend its review of the proposed power plant. “Granting a CPCN for the most expensive plant Idaho Power will have built in the last fifty years without a current IRP to instruct prudence questions,” the group argues, “is clearly an instance of putting the proverbial cart before the horse.” And, they add “this proposed plant should not be reviewed when the Company itself contends that its own IRP data is out of date…”

The coalition of intervenor groups urge the Commission to exercise “extreme caution” in its deliberations on Langley Gulch given that Idaho Power has asked for Commission pre-approval as authorized by the Idaho Legislature’s recent enactment of SB-1123. “…The need for delay in this docket,” the intervenors argue, “is all the more critical because the Commission’s decision will likely be irreversible by future commissions.”

Directly addressing two of Idaho Power’s central arguments for expedited review, the groups argue that the softening of the power market should enable Idaho Power to extend the deadline for payment on the turbines it has on order from Siemens. They add too that the utility itself has already delayed its expected online date for the plant by six months moving the scheduled start up into Winter 2012, a season of traditionally low power demand. “At worst, the plant will be needed in the summer of 2013,” the intervenors claim, and “Idaho Powers’ ability to meet load will not be in jeopardy by a delay in this docket’s schedule.”

The coalition argues in its May 29^th filing that the “stubborn nature and extent of the recession,” unknown at the time Idaho Power prepared its CPCN Application, is a fundamental cause for delay. They cite PacifiCorp’s recent termination of its acquisition of a major resource “given the dramatic global economic downturn in late 2008 and the resulting reduction of customer loads…” This suggests, the groups maintain, that Idaho Power should consider “…slowing down to assess the best future course of action [for it].”

And finally, the coalition’s May 29^th filing points to a recent Commission authorized dispatchable irrigation curtailment program that is expected to conservatively shave 232 megawatts off Idaho Power’s peak demand by 2011.

This innovative program along with another, targeted at air conditioning load, the groups argue “minimize the need for Idaho Power to acquire more expensive supply side resources such as Langley Gulch.”

“There are lots of reasons to be concerned about Langley Gulch,” Richardson, the industrial customers’ attorney underscored, “and not the least of these is that so many diverse interests have coalesced to ask the Commission to direct Idaho Power to stand down. We rarely agree,” says Richardson, “but on this point there’s unanimity. Idaho Power should not proceed with Langley Gulch until we all have a better understanding of market conditions and power demand, environmental effects and other impacts. Now is not the time to push this self-selected, so-called ‘competitive’ and dubiously ‘urgently needed’ resource forward.”