mark r, overstreetpsc.ky.gov/pscscf/2013 cases/2013-00144/20130913_kentucky_pow… · 13/09/2013...

SriTES 8 HARBISON PLLC

A T T O R N F V S

SEP 1 3 2013

PUBLIC SERVICE COWIMISSION

September 13,2013

HAND D E L I V E R E D

Mark R, Overstreet

(502) 209-1219

(502) 223-4387 FAX [email protected]

Jeff R. Derouen Executive Director Public Service Commission 211 Sower Boulevard P.O. Box 615 Frankfort, K Y 40602-0615

R E : Case No. 2013-00144

Dear Mr. Derouen:

Enclosed please find and accept for t i l ing the original and ten copies of the Company's Hearing Data Request responses

A copy of the responses is being served by overnight delivery on counsel for the parties by copy of this letter.

Please do not hesitate to contact me i f you have any questions. — — —

MRO cc: Michael L. Kurtz

Jennifer B. Hans

RECEIVED SEP 1 3 2013

C O M M O N W E A L T H O F K E N T U C K Y PUBLIC SERVICE

B E F O R E T H E P U B L I C S E R V I C E C O M M I S S I O N C01\AWI1SS10N

IN T H E M A T T E R O F :

A P P L I C A T I O N O F K E N T U C K Y P O W E R C O M P A N Y F O R A P R O V A L O F T H E T E R M S AND C O N F I T I O N S O F T H E R E N E W A B L E E N E R G Y P U R C H A S A G R E E M E N T F O R B I O M A S S E N E R G Y R E S O U R C E S B E T W E E N T H E C O M P A N Y AND E C O P O W E R G E N E R A T I O N - H A Z A R D L L C ; A U T H O R I Z A T I O N T O E N T E R I N T O T H E A G R E E M E N T ; G R A N T O F C E R T A I N D E C L A R A T O R Y R E L I E F ; AND G R A N T O F A L L O T H E R I N Q U I R E D A P P R O V A L S AND R E L I E F

Case No. 2013-00144

K E N T U C I < : Y P O W E R C O M P A N Y R E S P O N S E S T O

C O M M I S S I O N S T A F F ' S A U G U S T 28-29,2013 P O S T H E A R I N G D A T A R E Q U E S T S

September 13, 2013

V E R I F I C A T I O N

The undersigned, Ranie K. Wolmlias, being duly sworn, deposes and says he is the Managing Director Regulatory and Finance for Kentucky Power, that he has personal knowledge of the matters set forth in the forgoing responses for which he is the identified witness and that the information contained therein is true and correct to the best of his information, knowledge, and belief

Ranie K. Wohnhas

C O M M O N W E A L T H OF K E N T U C K Y ) ) Case No. 2013-00144

COUNTY OF F R A N K L I N )

Subscribed and sworn to before me, a Notary Public in and before said Counly and State, by Ranie K. Wohnhas, this the day of September 2013.

/Rotary p ib l ic

My Commission Exvires:'-^¥^M€^A.^^ , T

K P S C Case No. 2013-00144 Commission Staffs Post Hearing Data Request

Dated August 28-29, 2013 Item No. 1 Page 1 of 1

Kentuclcy Power Company

R E Q U E S T

Please refer to Tar i f f B.E.R. Please provide a revised Tar i f f B.E.R. reflecting the "true-up" of any over-recovery or under-recovery under the tariff.

R E S P O N S E

Please see KPSC PH-1 Attaclmient 1 to this response.

W I T N E S S : Ranie K Wolinhas

KPSC Case No, 2013-00144 August 28-29, 2013 Hearing

Commission Staff's Post Hearing Data Requests Item No. 1

Attachment 1 Page 1 of 1

IfENTUCKY POWER COMPANY P.S.C. ICY. NO. 10 ORIGINAL SHEET NO. 23-1 CANCELLING P.S.C. KY. NO. 10 SHEET NO. 23-1

T A R I F F B.E.R. (Bioniass Energy Rider)

A P P L I C A B L E .

To Tariffs R.S., R.S.-L.M.-T.O.D., R.S.-T.O.D., Experhnenfal R.S.-T.O.D.2, S.G.S., Experimental S.G.S.-T.O.D., M.G.S., M.G,S.-T.O.D., L.G.S.,L.G.S.T.O.D., Q.P., C.LP.-T.O.D., C.S.-l.R.P,. M.W., O.L. and S.L.

R A T E .

1. When energy is generated and sold to the Company fi-om the ecopower biomass facility, an additional charge equal to the product o f flie k W h o f sales and a biomass adjustment factor (A) shall be made, where, " A " , calculated to the nearest 0.0001 mi l per ldIowatt=hom-, is defined as set forth below.

Biomass Adjustment Factor (A)=(R*Pm)/Sm

In the above formulas "R" is the rate for the current calendar year approved by this commission in the REPA between ecopower and Kentuclcy Power Company, "P" is the about o f Kwh purchased by Kentuclcy Power in the cuxTent (m) period, and "S" is the k W h sales in the cun-ent (m) period, all defined below.

2. Rate ® shall be the dollar per M W h as defined in the REPA between ecopower and Kentucky Power Company, including any applicable escalation factor as defined in the REPA.

3. Produced energy (P) shall be the M W l i produced and sold to Kentucky Power Company.

4. Sales (S) shall be all K W h sold, excluding intersystem sales. Uti l i ty used energy shall not be excluded in the

determinafion o f sales (S).

5. A n y over/under recovery wi l l be reflected in tlie monthly filing for the second bill ing month following the month the cost is incuixed.

6. The monthly bio mass energy rider shaU be filed wi th the Commission ten (10) days before i t is scheduled to go into eifect, along wi t l i all the necessaiy supporting data to justify the amount of the adjustment, which shall include data, and information as may be required by the Commission.

7. Copies of all documents required to be fi led with the Commission shall be open and made available for public inspection at the office of the Public Sei-vice Commission pursuant to the provisions f KRS61.S70 to 61.884.

D A T E O F ISSUE X X X X X X X X S X

D A T E E F F E C T I V E SERVTCE R E N D E R E D ON O R A l ' T E R XXX}CXX

ISSUED B Y ,

T Q - L E : MANAGER M G U L A T O R Y S E R V I C E S

B Y A U T H O R I T Y O F ORDER B Y T H E P U B L I C E S E R V I C E COMAUSSIOW

IN C A S E NO. 2013-XXXX DATED

K P S C Case No. 2013-00144 Commission Staffs Post Hearing Data Request


Kentuclcy Power Company

R E Q U E S T

Please provide the sample monthly filings the Company anticipates malcing in connection with Tar i f f B.E.R. i f i t is approved.

R E S P O N S E

Please see KPSC PH-2 Attachment 1 to this response.

W I T N E S S : Ranie K Wolinlias

KPSC Case No. 2013-00144 August 28-29, 2013 Hearing

Commission StafTs Post Hearing Data Requests Item No. 2


Page 1 o f 4

K E N T U C K Y P O W E R C O M P A N Y

B.E.R. SCHEDULE

Month Ended:

B.E.R. Cost Schedule Sales Sm (Sales Schedule) ( + ) ($/KWH)

Effective Date for Bil l ing

Submitted by:

(Signature)

Title:

Date Submitted:


Commission Staffs Post Hearing Data Requests Item No. 2


Page 2 o f 4

K E N T U C K Y POWER C O M P A N Y

B.E.R. COST SCHEDULE

M o n t h Ended:

A, Energy Purchased ( + )

B. Total Company Over or (Under) Recoveiy fi-om Page 4 ( + )

C. Grand Total B.E.R. Cost (A + B)


Commission Staffs Post Hearing Data Requests Item No, 2


Page 3 o f 4


SALES SCHEDULE

M o n t h Ended:

Kilowatt-Hours

Generation (Net)

Purchases Including Interchange In

Sub Total

( + )

( + )

Pumped Storage Energy

Inter-System Sales Including Interchange Out

System Losses

Sub Total

( + )

( + )

( + )

Total Sales (A - B)

* Does not include K W H of company usage.

KPSC Case No, 2013-00144 August 28-29, 2013 Hearing

Commission Staffs Post Hearing Data Requests Item No. 2


Page 4 of 4


O V E R OR (UNDER) R E C O V E R Y SCHEDULE

Month Ended:

Line

No.

1 BER Rate Billed ( + )

2 Retail K W H Billed at Above Rate ( x )

3 BER Revenue ( L l * L2)

4 K W H Used to Determine Last BER Rate Billed ( + )

5 Non-Jurisdictional K W H Included in L4 ( - )

6 Kentuclcy Jurisdictional K W H Included in L4 (L4 - L5)

7 Recoverable BER Revenue ( L l * L6)

8 Over or (Under) Recovery (L3 - L7)

9 Total Sales (Page 3) ( + )

10 Kentuclcy Jurisdictional Sales ( / )

11 Ratio of Total Sales to K Y . Jurisdictional Sales (L9 / LIO)

12 Total Company Over or (Under) Recovery (L8 * L l 1)

I

KPSC Case No. 2013-00144 Commission Staffs Post Hearing Data Requests


Kentucky Power Company

R E Q U E S T

Please refer to the Company's response to Staff 5-10 m Case No. 2012-578. Please modify the response to add two columns. The first additional column should illustrate the conversion in 2015 of Big Sandy Unit 1 to natural gas and its recovery tlirough rates. The second additional column should illustrate the effect on rates in 2017 of the Commission's approval of the ecoPower REPA assuming the ecoPower facility become operational in 2017. For each column further modify the response to use jurisdictional revenues of $501,037,000 (from row 6, Exhibit RICW-1, Testimony of Ranie K. Wohnlias, Case No. 2013-00144) for the twelve months ended December 31, 2012, in lieu of the $511,321,000, for the twelve months ended March 31, 2013 used in the response to Staff 5-10 in Case No. 2012-00578. For each column of the response illustrate both the incremental and cumulative effect on rates.

R E S P O N S E

Please see KPSC PH-3 Attacliment 1 to this response which shows additional columns demonstrating the effect o f the conversion of Big Sandy Unit 1 to natiu-al gas and the ecoPower REPA. The spreadsheet is also modified to show the percentage increase using as a starting point jurisdictional revenues for twelve months ended December 31, 2012 o f $501,037,000. The Company has also provided for comparison purposes KPSC PlI-3 Attachment 2 which shows the additional columns but show as the starting point jurisdictional revenues for the more recent twelve months ended March 31, 2013 of $511,321,000 as filed in response to KPSC 5-10 in Case No. 2012-00578.

W I T N E S S : Ranie K Wohnlias

KPSC Case No. 2012-0D57S

Commission Staffs Fifth Set of Data Requests

Order Dated June 26, 2013

I tem No. 10

At tachment 1

Page 1 of 1

KPSC Case No. 2013-00144

Commission Staff's Post Hearing Data Requests

IHearing Dated August 28-29, 2013

Item No. 3

Attachment 1

Page 1 of 1


Rate Change Comparison

($000)

Jan 2014 -Jun 201S July 2015 f o rwa rd Rate Impact Incl. Rate Impact Incl.

Mi tchel l Mi tchel l Incremental Big Sandy Incremental ecoPower

Transfer Transfer Big Sandy Unit No. 1 ecoPowfer REPA

Line DF6D Overlap Post BSU2 Unit No. 1 Repowered REPA Effect

No. Descript ion Filing Period Ret i rement Reoowered (P) (31-K41 Effect (5 )+ (61

(1) (2) (3) (4) (5) (6) (7)

1 COS Impact S 177,699 A. s 44,000 F. s 81,244 J, $ 8,571 Q. S 89,815 S 50,561 U, $ 140,376

Adjustments:

2 Big Sandy Fuel Savings S (18,211) B. N/A N/A s $ s s -3 Mitchell Fuel Savings N/A S (16,750) G, s (16,750) $ s (16,750) s s (16,750)

4 Pool Elimination (4) $ (21,304) C, s - s (21,304) $ s (21,304) s s (21,304)

5 Environmental Pool Adjustment S (7,320) D, $ H, s (7,320) s s (7,320) $ s (7,320)

6 SS Tariff Adjustment N/A s i. N/A N/A N/A N/A N/A

7 BS Decommissioning Costs N/A N/A s 7,948 K. - $ 7,948 s $ 7,948

8 BS Amort. Of Undepr. Balance N/A N/A s 21,056 L, s s 21,056 s $ 21,055

. 9 BSLI2 Study Costs N/A N/A s 6,598 M, $ - s 6,598 s s 6,593

9a Remaining BS Coal OaiVl $ (6,641) R, (6,641) $ s (6,641)

9b Year 1 BSUl Qas O&IVi $ 4,684 S. s 4,684 s $ 4,684

9c Gas Pipeline Demand Charge s 5,631 T, s 5,631 $ s 5,631

9d Avoided Fuel Cost 5 (12,780) V. i (12,780)

9e Avoided Capacity Cost S (2,730) W. s (2,730)

10 Total of Adjustments S (46,835) s (16,750) s (9,772) s 3,674 s (6,098) S (15,510) s (21,608)

11 Adjusted cos impact $ 130,864 s 27,250 s 71,472 s 12,245 s 83,717 $ 35,051 s 118,768

12 Case 2013-00144 Exhibit RKW-1 (Ln 6) S 501,307 E, s 501,307 $ 501,307 N. s 501,307 s 501,307 S 501,307 s 501,307

U 3 Percent Change f rom Line 12 26,10% 5,44% 14,26"/. N, 16.70% 23.69%

W14 Incremental 2015 Percent Change

14a Incremental 2016 Percent Change

14b Incremental 2017 Percent Change

Columns (2) and (3) are not addit ive.

A. Exhibit LPM-2, Case No. 2011-00141

B. Staffs Fourth Set of Data Requests in Case No. 2012-00578, Item No. 9, At tachment 1, Page 3 of 3.

Average of two calendar 2013 values.

C. Section V, Workpaper S-4, Page 4, Case No. 2013-00197

D. Section V, Workpaper S-4, Page 62, Case No. 2013-00197

E. Case No. 2013-00144 Exhibit RKW-1 Line 6

F. Memorandum of Understanding fi led In Case No, 2012-00573, Paragraph 4

G. Memorandum of Understanding filed in Case No. 2012-00578, Paragraph 2

H. Memorandum of Understanding filed in Case No. 2012-00578, Paragraph 5

I. Memorandum of Understanding fi led in Case No. 2012-00578, Paragraph 7

J. Includes removal of BSU2 O&M and Depreciation - see Attachment Page 2

K. $85,227 M collected over 25 years w i th carrying costs at WACC (8.08%)

L. $225,795 M collected over 25 years w i th carrying costs at WACC [8.08%)

M. $23,113,304 collected over 5 years wi th interest at long-term debt rate of 6.48%

N. Revenues would be higher and % increase lower if MOU implemented 1/1/2014

O. Does not reflect changes in other (Non-MitcheH) costs or revenues, if any,

that may be part of future rate case.

P. To the extent that a gas fired BSUl is dispatched to meet internal load due to potential lower fuel costs there could be modest fuel savings.

The Company has not done an analysis to determine if such benefits exist.

Q. Total Capital Cost as provided in bid solicitation f rom BSUl RFP mult ipl ied times pre tax WACC plus depreciation rate

R. Remaining BS O & M to be removed f rom books in Case 2013-00197 after Removal of BSU2 {See Section V, Workpaper 5-4, Page 66)

S. Year 1 BSUl Gas O&M provided in bid soiiciatation f rom BSUl RFP

T. Annual Charge to build gas pipeline to BSUl provided in bid solicitation f rom BSUl RFP

U. See Exhibit 1 Line 1 of the Direct Testimony of Witness Ranie K. Wohnhas

V, See Exhibit 1 Line 3 of the Direct Testimony of Witness Ranie K. Wohnhas

W. See Exhibit 1 Line 4 of the DirectTest lmony of Witness Ranie K, Wohnhas


Commission Staff's Fiftin Set of Data Requests

Orcier Dated June 26. 2013

I tem No. 10

At tachment 1

Page 1 of 1


Commission Staffs Post Hearing Data Requests

Heanng Dated August 28-29, 2013

Item No. 3

Attachment 2

Page 1 of 1


Rate change Comparison

(SOOO)

Jan 2014-Jun 20X5 July 2015 f o rwa rd Rate Impact Incl. Rata Impact Inc!.

Mi tche l l Mi tchel l Incremental Big Sandy Incremental ecoPower

Transfer Transfer Big Sandy Unit No. 1 ecoPower REPA

l ine DFGD Overlap PostBSUZ Unit No. 1 Repowered REPA Effect

No. Descriotion Filing Period Ret i rement Reoowered (PI (3 )+ (4) Effect (5 ) -K6)

U) (21 (31 (4) (5) (6) (7)

1 COS Impact S 177,699 A. s 44,000 F. s 81,244 J. s 8,571 Q. s 89,815 5 50,561 U, i 140,376

Adjustments;

2 Big Sandy Fuel Savings 5 (18,2111 B. N/A N/A $ - s - S i -3 Mitchell Fuel Savings N/A $ (16,750) G. s (16,7501 s s (16,750) S $ (16,750)

4 Pool Elimination (4) $ (21,304) C. s - s (21,304) s s (21,304) $ s (21,3041

5 Environmental Pool Adjustment S (7,320) D. s H. $ (7,3201 s - s (7,320) S S (7,3201

6 ss Tariff Adjustment N/A s 1. N/A N/A N/A N/A N/A

7 BS Decommissioning Costs N/A N/A s 7,948 K. s - 5 7,948 S $ 7,948

3 BS Amort . Of Undepr. Balance N/A N/A s 21,056 L. s - $ 21,056 S S 21,056

9 BSU2 study Costs N/A N/A s 6,593 M. s s 6,598 $ s 6,598

9a Remaining BS Coai O&M s (6,641) R. s (6,6411 s (6,6411

9b Year 1 BSUl Gas OS.M s 4,684 s. s 4,684 S $ 4,684

9c Gas Pipeline Demand Charge s 5,631 T, s 5,631 $ $ 5,631

9d Avoided Fuel Cost S (12,780) V, s (12,780)

9e Avoided Capacity Cost $ (2,730) W. s (2,7301

10 Total of Adjustments i (46,8351 s (16,750) (9,7721 s 3,674 5 (6,09B1 S (15,510) s (21,6081

11 Adjusted COS Impact S 130,864 s 27,250 s 71,472 s 12,245 s 83,717 S 35,051 s 118,768

12 Case 2013-00197 Juris. Revenues S 511,321 E. s 511,321 s 511,321 N. $ 511,321 s 511,321 S 511,321 $ 511,321

| 1 3 Percent Change f rom Line 12 25.59% 5.33% 13.98% N. 16.37% 23.23%

14 incremental 2015 Percent Change 8 .21% 0 .

14a Incremental 2016 Percent Change

14b Incremental 2017 Percent Change

Columns (2) and (3) are not addit ive.

A. Exhibit LPM-2, Case No. 2011-00141

B. Staff's Fourth Set of Data Requests in Case No, 2012-00578, Item No. 9, At tachment 1 , Page 3 of 3.

Average of two calendar 2013 values.

C. Section V, Workpaper S-4, Page 4, Case No. 2013-00197

D. Section V, Workpaper S-4, Page 52, Case No. 2013-00197

E. Section V, Schedule 5 - jurisdict ional Operating Revenues, Case No. 2013-00197

F. Memorandum of Understanding filed in Case No. 2012-00578, paragraph 4

G. Memorandum of Understanding filed in Case No. 2012-00578, Paragraph 2

H. Memorandum of Understanding filed in Case No. 2012-00578, Paragraph 5

I. Memorandum of Understanding filed in Case No. 2012-00578, Paragraph 7

J. Includes removal of BSU2 O & M and Depreciation - see Attachment Page 2

K. $85,227 M collected over 25 years w i t h carrying costs at WACC (8.08%)

L, $225,795 M collected over 25 years w i th carrying costs at WACC (8.08%)

M. $28,113,304 collected over S years w i th interest at long-term debt rate of 6.48%

N. Revenues would be higher and % increase lower if MOU Implemented 1/1/2014

O. Does not reflect changes In other (Non-Mitchell) costs or revenues, if any,

that may be part of future rate case.

P. To the extent that a gas f ired BSUl is dispatched to meet internal load due to potential lower fuel costs there could be modest fuel savings.

The Company has not done an analysis to determine if such benefits exist.

Q. Total Capita! Cost as provided in bid solicitation f rom BSUl RFP mult ipl ied times pre tax WACC plus depreciation rate

R. Remaining BS O&M to be removed f rom books in Case 2013-00197 after Removal of BSU2 (See Section V, Workpaper S-4, Page 66)

S. Year 1 BSUl Gas O & M provided in bid soiiciatation f rom BSUl RFP

T. Annual Charge to build gas pipeline to BSUl provided in bid solicitation f rom BSUl RFP

U. See Exhibit 1 Line 1 of the Direct Testimony of Witness Ranie K. Wohnhas

V. See Exhibit 1 Line 3 of the Direct Testimony of Witness Ranie K. Wohnhas

W. See Exhibit 1 Line 4 of the DirectTestlmony of Witness Ranie K. Wohnhas

mark r, overstreetpsc.ky.gov/pscscf/2013 cases/2013-00144/20130913_kentucky_pow… · 13/09/2013...

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