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Idaho Power to Pursue Rate Increases by Nate Poppino Times-News, April 9, 2008

Rates to cover new natural gas plant, transmission lines

Idaho Power Co. customers will see a series of rate increases over the next several years, all to help boost the company's power production and infrastructure, company officials said Tuesday.

Senior Vice President of Delivery Dan Minor said he wasn't sure yet what burden the construction would place on consumers. But due to growing demands for power and a maxed-out transmission grid in and out of state, the company plans to invest in new interstate transmission lines and a natural gas plant in the Treasure Valley that could add between 300 and 600 megawatts of energy to the company's grid.

One megawatt is enough to power about 700 average-sized homes during the non-summer months and 350 average-sized homes during summer.

The project, Minor said, will be the company's largest since it built the Hells Canyon Complex 50 years ago. And like that project, he said, it's vital to Idaho. The state's population is much larger than it was then and the computer age means that the average home now has 26 individual electronic devices, all sucking up energy whether they're on or not.

The company can't purchase more electricity from out of state, he added, because those lines have hit their maximum load.

"It has become more and more apparent that we really do need to build more infrastructure to stabilize Idaho's energy future," Minor said.

The natural gas plant, slated for completion around 2012, is the company's fallback option after plans for a coal-burning plant in Wyoming fell through. Much of the company's out-of-state power comes from coal plants in Wyoming, Nevada and Oregon, but the Wyoming expansion plans fell through in the face of opposition from environmental groups and others, Minor said.

"It feels like until there's clean-coal technology, it seems like you're asking for all sorts of legal challenges," Minor said.

The plan comes after a record-setting summer for the power utility. Five new records were set for total demand on the system, the highest reaching 3,193 megawatts, and the company burned through much of its reserves during 14 days at maximum capacity in July.

In March, the company proposed a 1.4 percent rate increase to cover a completed, separate gas plant near Mountain Home intended to help handle peak loads this summer.

The company is also working on two other fronts to handle the load, Minor said. It's working to promote smart growth in the Treasure Valley area, he said, frowning on businesses that combine high power loads with few jobs. And it is redoubling its energy-efficiency efforts, especially when it comes to programs aimed at residential users.

Two requests in front of the Idaho Public Utilities Commission would raise the company's surcharge for funding efficiency programs from 1.5 percent to 2.5 percent for all users, and a rate adjustment to compensate for the cost to Idaho Power when such programs cause sales to decline.