Idaho Power seeks to recover mobile generation costs in rates

Idaho Power Co. is asking the Idaho Public Utilities Commission for an order that authorizes the company to include the expenses of operating temporary mobile generators for possible recovery from ratepayers next year. The company estimated it costs about $124/Mw-hr to operate the mobile generators, compared to about $350/Mw-hr to buy power on the wholesale market.

June 15, 2001

2 min read

By the OGJ Online Staff

HOUSTON, June 15 -- Idaho Power Co., the regulated utility unit of IdaCorp. Inc., Boise, is asking the Idaho Public Utilities Commission for an order that authorizes the company to include the expenses of operating its temporary mobile generators for possible recovery from ratepayers next year.

The company said operating the diesel generators is cheaper than buying power on the wholesale market. The company estimated it costs about $124/Mw-hr to generate and distribute energy from the mobile generators. That's compared to about $350/Mw-hr to buy power on the wholesale market, the company said.

In response to low stream flows and high wholesale market prices, Idaho Power leased and installed 25 mobile generators in southwestern Idaho and in the Magic Valley to serve peak summer load. The generators will provide up to 40 Mw of electricity for customers.

The company said its current lease arrangement contemplates the generators will be in service through Oct. 31. The company owns and operates 17 hydroelectric power plants, and depending on water conditions, market prices, environmental permitting and other factors, the company said it may seek to add more mobile units or extend the term of the leases.

The company asked state regulator to allow recovery of the expense of leasing, installing, and operating the generators from its ratepayers. Idaho Power plans to file a plan with regulators in the spring for its annual power cost adjustment.

Idaho Power project manager John Carstensen said need for the generators was based on the current regional energy situation which has seen demand exceed supply and wholesale prices rise as much as 400% higher than just 1 year ago.

Last year the company purchased 21% of its total electric load from the wholesale market. That percentage may be even higher this year because of drought which will result in extremely poor hydroelectric generating conditions.

"We need to provide the most reliable and economical electric service we can," Carstensen said. "These temporary mobile generators are one piece of the energy solution."