Idaho Power Pursues Accelerated Depreciation of North Valmy Coal Plant
Idaho Power-co-owner with NV Energy of the two-unit 522-MW North Valmy Generating Station near Battle Mountain, Nevada-filed a request with the Idaho Public Utilities Commission (IPUC) last week seeking to accelerate the depreciable life of the power plant from 2031 for Unit 1 and 2035 for Unit 2 to 2025 for both units.
In Idaho Power's 2015 Integrated Resource Plan (IRP), the company said its preferred portfolio included retirement of the North Valmy plant at year-end 2025. The timing matched the expected completion date of the Boardman to Hemingway transmission line project, which will add a new connection to the Pacific Northwest. The preferred portfolio included the addition of 60 MW of demand response and 20 MW of ice-based thermal energy storage in 2030, and the addition of a 300-MW combined cycle combustion turbine in 2031.
The 2015 IRP included a 2016 action item to continue working with NV Energy "to synchronize depreciation dates and determine if a date can be established to cease coal-fired operations" at North Valmy Units 1 and 2. Previous reports had indicated that NV Energy was targeting a permanent shut down of Unit 1 in 2021 and retirement of Unit 2 in 2025. Idaho Power said its 2016 assessment concluded that customers "may not benefit" economically or from a reliability perspective, if the North Valmy plant was operated beyond 2025.
"This accelerated depreciation schedule is part of Idaho Power's commitment to a glide-path away from coal, and ensures that the remaining costs of Valmy will be allocated to those customers who will benefit from this resource," the company said in a news release.
For customers, it means $28.5 million would need to be recovered through rates sooner than previously scheduled. Although the impact on ratepayers varies by class, if approved, the overall change would amount to a 2.51% increase from currently billed rates.
-Aaron Larson, associate editor (@AaronL_Power, @POWERmagazine)
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