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Idaho Power Petitions to Close Coal-Fired Units, Hike Rates to Cover Costs

November 23, 2016 By Cheryl Kaften

Residential customers of Idaho Power could see an increase in their monthly power bills next year if the utility is allowed to close down the coal-powered North Valmy Generating Station in Nevada earlier than planned – a move the utility said would benefit its customers.

Idaho Power late last month petitioned (Case No. IPC-E-16-24) the Idaho Public Utilities Commission (PUC) to compress the depreciation schedule on the two-unit plant to allow the plant to be fully depreciated and shut down by year-end 2025.

The utility explained that a decrease in electricity market prices has made operation of the Valmy plant uneconomical except to meet peak energy needs in extreme temperatures

In line with that request, Idaho Power has asked the commission:

The company says retiring the plant early saves customers about $103 million in today’s dollars in the long run, according to a November 20 report in the Idaho Statesman.

In addition, the local news outlet said, Idaho Power has asked for a 0.6 percent increase to base rates to update depreciation on its remaining plant assets. The combined 3.1 percent base rate increase would mean a bump of about $3.08 per month for the average residential user.

 Originally, planned retirement for one unit was 2031; the other was set to shut down in 2035. The former (Unit 1) went into service in 1981 and Unit 2 followed in 1985. Idaho Power owns 50 percent, or 284 megawatts (MW) of Valmy. NV Energy also has 50 percent ownership interest; the two companies cooperate regarding investments, retirements, and conversions.

The PUC is allowing parties to intervene in either request through December 5. If the proposals are accepted, rate increases would go into effect on June 1, 2017.

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