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HomeMy WebLinkAbout20240624IPC to Staff 1-6 Redacted.pdf "4%611-w@IQAW POWER. RECEIVED DONOVAN E. WALKER Lead Counsel Monday, June 24, 2024 3:40:41 PM dwalker(a)idahopower.com IDAHO PUBLIC UTILITIES COMMISSION June 24, 2024 Commission Secretary Idaho Public Utilities Commission 11331 W. Chinden Boulevard Building 8, Suite 201-A Boise, Idaho 83714 Re: Case No. IPC-E-24-20 Idaho Power Company's Application for Approval of the First Amendment to the Power Purchase Agreement with PVS 2, LLC Dear Commission Secretary: Please find attached for electronic filing Idaho Power Company's Response to the First Production Request of the Commission Staff in the above-entitled matter. The confidential version will be provided separately via an encrypted email to the parties who sign the protective agreement. If you have any questions about the attached documents, please do not hesitate to contact me. Sincerely, Donovan E. Walker DEW:sg Attachments 1221 W. Idaho St(83702) P.O. Box 70 Boise, ID 83707 CERTIFICATE OF ATTORNEY ASSERTION THAT INFORMATION CONTAINED IN AN IDAHO PUBLIC UTILITIES COMMISSION FILING IS PROTECTED FROM PUBLIC INSPECTION Case No. IPC-E-24-20 In the Matter of the Application of Idaho Power Company for Approval of the First Amendment to the Power Purchase Agreement with PVS 2, LLC The undersigned attorney, in accordance with Commission Rules of Procedure 67, believes that Idaho Power Company's Response to the First Production Request of the Commission Staff dated June 24, 2024, contains information that a third party claims is a confidential trade secret as described in Idaho Code § 74-101, et seq., and/or § 48- 801, et seq. As such, it is protected from public disclosure and exempt from public inspection, examination, or copying. DATED this 24th day of June, 2024. Donovan E. Walker Counsel for Idaho Power Company DONOVAN E. WALKER (ISB No. 5921) Idaho Power Company 1221 West Idaho Street (83702) P.O. Box 70 Boise, Idaho 83707 Telephone: (208) 388-5317 Facsimile: (208) 388-6936 dwalker(o-)idahopower.com Attorney for Idaho Power Company BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION IN THE MATTER OF THE APPLICATION ) OF IDAHO POWER COMPANY FOR ) CASE NO. IPC-E-24-20 APPROVAL OF THE FIRST AMENDMENT ) TO THE POWER PURCHASE ) IDAHO POWER COMPANY'S AGREEMENT WITH PVS 2, LLC. ) RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF COMES NOW, Idaho Power Company ("Idaho Power" or "Company"), and in response to the First Production Request of the Commission Staff ("Commission" or "Staff") dated June 3, 2024, herewith submits the following information: IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 1 STAFF REQUEST FOR PRODUCTION NO. 1: The Application states that compared to the original Scheduled Commercial Operation Date of December 31, 2026, the proposed Scheduled Commercial Operation Date of May 31, 2026, "better aligns the new generation with Brisbie's anticipated load and Idaho Power's anticipated 2026 summer peak load." Application at 2. Please respond to the following: a) Please provide evidence supporting the Company's assertion that the proposed Scheduled Commercial Operation Date better aligns the new generation with Brisbie's anticipated load, compared to the original Scheduled Commercial Operation Date; b) What are the impacts if the capacity of PVS 2 comes online before Brisbie's load materializes and how will the Company mitigate the impacts? Please include, but not limit the explanation to: (i.) the amount of excess generation credits; (ii.) how compliance of the 110% annual energy limit in Schedule 62 will be affected; (iii.)the feasibility of curtailing PVS 2 generation to match Brisbie's load ramp, etc.; and c) What are the impacts if the capacity of PVS 2 comes online after Brisbie's load materializes? Please include, but not limit the explanation to: (i.) the sufficiency of system capacity to meet system load with Brisbie's load included; (ii.) the accuracy of Brisbie's rates for supplemental energy and demand charges due to the higher loads the Company must meet with its system resources, etc. IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 2 RESPONSE TO STAFF'S REQUEST FOR PRODUCTION NO. 1: a) Brisbie's load forecast indicates it will ramp throughout 2026. Therefore, moving the Scheduled Commercial Operation Date ("COD") from December 31, 2026, to May 1, 2026, better aligns the new generation with Brisbie's anticipated load ramp. As explained in part (c) of this response, PVS 2 will provide benefits irrespective of the precise timing coinciding with Brisbie's load ramp. Further, as explained in the Direct Testimony of Mr. Jared Ellsworth filed in Case No. IPC-E-24-12, Idaho Power's Application for Approval of a Market Purchase Agreement, the Company's annual capacity deficit positions remain fluid during the near-term resource decision-making phase requiring the continual assessment of system reliability. The fluctuating need is requiring continued procurement of resources. Idaho Power issued the 2026 All-Source Request for Proposals, seeking a combination of energy and capacity resources to meet the identified capacity deficits in 2026 and 2027 ("2026 RFP"). Through this competitive solicitation, the Company executed the Market Purchase Agreement and selected a benchmark resource, an Idaho Power-owned battery storage facility, as resources necessary to fill the 2026 capacity deficit. The Company is currently in negotiations with developers for the procurement of additional 2026 resources. A Scheduled Commercial Operation Date of May 31, 2026, for PVS 2 would also help Idaho Power fill the 2026 capacity deficit should there be any delays in the commercial operation date of resources selected IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 3 through the 2026 RFP. b) No impacts were identified regarding the timing of capacity of PVS 2 and Brisbie's load forecast materializing relative to pricing. The pricing and compensation structure pursuant to the Brisbie Energy Sales Agreement ("ESA") accounts for any differences in the timing without the need to curtail PVS 2 generation. The Commission has previously determined that the Excess Generation Price in the Brisbie ESA, which is based on the lower of 85 percent of the Mid-Columbia Forecast with a non-firm adjustment applied or the actual heavy or light load hour, is a fair, just, and reasonable price. As described in Response to Staff's Request for Production No. 4, the Brisbie ESA and Schedule 33 define the terms and conditions applicable to Brisbie. Finally, the change in the COD of PVS 2 doesn't impact compliance relative to the Total Supply Obligation pursuant to the Brisbie ESA, and the addition of PVS 2 is within the 110 percent of Total Supply Obligation pursuant to the Brisbie ESA as further detailed in the Response to Staff's Request No. 4. c) Based on information provided by Brisbie, the Company's current load forecast assumes Brisbie will peak at _ in June, July, and August of 2026, respectively. If Brisbie's load ramp is consistent with the Company's current load forecast, PVS 2 will provide capacity to the grid as further explained in part (a) to this response. PVS 2 is expected to provide approximately 39 MW of Effective Load Carrying Capability ("ELCC") for 2026; i.e., 31.54% ELCC of a 125 MW IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF -4 solar project. Please see part (b) regarding pricing. The response to part (a) and (c) of this Request is sponsored by Jared L. Ellsworth, Transmission, Distribution, and Resource Planning Director, Idaho Power Company. The response to part (b) of this Request is sponsored by Grant T. Anderson, Regulatory Consultant, Idaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 5 STAFF REQUEST FOR PRODUCTION NO. 2: The Application states that the proposed Scheduled Commercial Operation Date of May 31, 2026, better aligns the new generation with Idaho Power's anticipated 2026 summer peak load. Please respond to the following: a) Please provide the expected amount of excess capacity of PVS 2 that can contribute to meeting the anticipated 2026 summer peak load; b) Please explain whether the proposed Scheduled Commercial Operation Date will lower the Company's summer capacity need of 2026 for other projects; and c) If so, does the Company plan to change the scheduled commercial operation dates of other 2026 projects? RESPONSE TO STAFF'S REQUEST FOR PRODUCTION NO. 2: a) As explained in the Response to Staff's Request for Production No. 1, PVS 2 is expected to provide approximately 39 MW of Effective Load Carrying Capability ("ELCC") for 2026; i.e., 31.54% ELCC of a 125 MW solar project. b) Yes, PVS 2 provides an ELCC of approximately 39 MW, which would aid in filling the 2026 capacity deficit. c) No. The 2026 RFP required projects meet a June 1, 2026, commercial operation date therefore the resources for which the Company is seeking approval of in Case Nos. IPC-E-24-12 and IPC-E-24-16 are scheduled to be online in time to meet the 2026 summer peak. The response to this Request is sponsored by Jared L. Ellsworth, Transmission, Distribution, and Resource Planning Director, Idaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 6 STAFF REQUEST FOR PRODUCTION NO. 3: Please explain whether there is a possibility that Brisbie's load grows ahead of May 31, 2026. If so, please explain whether the Company has enough resources to meet Brisbie's load. RESPONSE TO STAFF'S REQUEST FOR PRODUCTION NO. 3: Brisbie's load forecast indicates it will ramp throughout 2026. The Company engaged in recent discussions with Brisbie regarding its load forecast and, in those discussions, Brisbie has indicated it does not anticipate its load forecast being accelerated ahead of May 31, 2026. Idaho Power would only accept changes from its current planning scenario that ensure resource adequacy. The response to this Request is sponsored by Jared L. Ellsworth, Transmission, Distribution & Resource Planning Director, Idaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 7 STAFF REQUEST FOR PRODUCTION NO. 4: Schedule 62 requires that customers pursuing the Construction option limit requests to size the Renewable Energy Facilities to 110 percent of the participating service point annual energy amounts. Please provide evidence supporting that the capacity size of PVS 2 meets this requirement. RESPONSE TO STAFF'S REQUEST FOR PRODUCTION NO. 4: As a point of clarification, the Brisbie ESA, not Schedule 62, includes the terms and conditions applicable to Brisbie for renewable resource projects. Pursuant to the Brisbie ESA, the total Project nameplate capacity times applicable Project capacity factor shall not exceed 110 percent of the Total Supply Obligation. The combined generation forecast for PVS 1 and PVS 2 represents approximately _ megawatt hours ("MWh") annually, compared to the Total Supply Obligation of approximately— MWh, according to Idaho Power's load forecast from Brisbie for June 2026 — May 2027. The response to this Request is sponsored by Grant T. Anderson, Regulatory Consultant, Idaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 8 STAFF REQUEST FOR PRODUCTION NO. 5: Page numbers of First Amendment to the Power Purchase Agreement ("First Amendment") show 3 pages. However, only 2 pages were filed with the Commission. Please file a complete First Amendment, if the third page is missing. RESPONSE TO STAFF'S REQUEST FOR PRODUCTION NO. 5: The page numbering in the First Amendment inadvertently references three (3) pages when there are only two (2) pages. Please see the file labeled "Attachment 1 — Response to Staff Request No. 5" for a corrected version of the First Amendment. Idaho Power corrected the page number in the footer to indicate a total of two pages rather than three and corrected "Second Amendment" on page two to correctly state "First Amendment". These corrections were handwritten and initialed by counsel for Idaho Power. Idaho Power obtained PVS 2 LLC's consent and permission to make the identified handwritten corrections. The response to this Request is sponsored by Donovan Walker, Lead Counsel, Idaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 9 STAFF REQUEST FOR PRODUCTION NO. 6: Page 2 of First Amendment states that "IN WITNESS WHEREOF, the Parties hereto have caused this Second Amendment to duly executed as of the date above written." Please confirm whether "Second Amendment" should have been "First Amendment". RESPONSE TO STAFF'S REQUEST FOR PRODUCTION NO. 6: The reference to the "Second Amendment" is an administrative oversight. It should have read "First Amendment," as stated in the header on the first page and the footer of the amendment. Please see the file labeled "Attachment 1 — Response to Staff Request No. 5" for a corrected version of the First Amendment. Idaho Power corrected the page number in the footer to indicate a total of two pages rather than three and corrected "Second Amendment" on page two to correctly state "First Amendment". These corrections were handwritten and initialed by counsel for Idaho Power. Idaho Power obtained PVS 2 LLC's consent and permission to make the identified handwritten corrections. The response to this Request is sponsored by Donovan Walker, Lead Counsel, Idaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 10 Respectfully submitted this 24t" day of June 2024. DONOVAN WALKER Attorney for Idaho Power Company IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 11 CERTIFICATE OF SERVICE I HEREBY CERTIFY that on this 24t" day of June 2024, 1 served a true and correct copy of the within and foregoing IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF upon the following named parties by the method indicated below, and addressed to the following: Commission Staff Hand Delivered Adam Triplett U.S. Mail Deputy Attorney General Overnight Mail Idaho Public Utilities Commission FAX 11331 W. Chinden Blvd., Bldg No. 8 FTP Site Suite 201-A (83714) X Email Adam.Triplett(cr puc.idaho.gov PO Box 83720 Boise, ID 83720-0074 Stacy Gust Regulatory Administrative Assistant IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 12 BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION CASE NO. IPC-E-24-20 IDAHO POWER COMPANY ATTACHMENT NO. 1 RESPONSE TO STAFF REQUEST NO. 5 DocuSign Envelope ID:54558DAA-70CD-48BF-AB79-058AOADD2591 FIRST AMENDMENT TO THE POWER PURCHASE AGREEMENT BETWEEN PVS 2, LLC AND IDAHO POWER COMPANY This First Amendment to the Power Purchase Agreement("First Amendment")is effective as of May 14 ,2024("Effective Date")and is entered into by and between Idaho Power Company, an Idaho corporation ("Idaho Power") and PVS 2, LLC, a Utah limited liability company ("Seller"), (individually a"Party" and collectively the "Parties"). WHEREAS, Idaho Power entered into the Power Purchase Agreement ("PPA") with the Seller on December 5, 2023, for the purchase and sale of energy and Green Tags for the benefit of Brisbie, LLC ("Brisbie" or"Customer")pursuant to a Special Contract between Idaho Power and Brisbie ("Special Contract"). The PPA was filed for review and approval with the Idaho Public Utilities Commission("Commission") on January 3, 2024. Commission Staff filed its Comments regarding the PPA on April 3, 2023, recommending approval of the PPA. Case No. IPC-E-24-01. WHEREAS, the Special Contract between Idaho Power and Brisbie was filed for review and approval with the Commission on December 22, 2021, and approved by Order No. 35777 on May 11, 2023. Case No. IPC-E-21-42. WHEREAS, the PPA contains a Scheduled Commercial Operation Date of December 31, 2026,and the Parties desire to enter into this First Amendment to the PPA to change the Scheduled Commercial Operation Date to May 31,2026,and submit the same for the Commission's approval. NOW, THEREFORE, in consideration of the foregoing, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, and intending to be legally bound,the Parties hereto agree as follows: 1. Incorporation of Recitals. The above-stated recitals are incorporated into and made a part of the PPA, as amended,by this reference to the same extent as if these recitals were set forth in full at this point. 2. Amendment. (new language is underlined, and deleted language uses sail reugh) Section 1.123 of the PPA shall hereby be Amended as follows: "1.123 `Scheduled Commercial Operation Date' means MayDeeembff 31, 2026, subject to adjustment for delays due to Events of Force Majeure, delay beyond the date set forth in or otherwise agreed pursuant to Section 3.1.4, and Interconnection Delay." 3. Commission Approval. The obligations of the Parties under this First Amendment are subject to the Commission's approval of this First Amendment and such approval being upheld on appeal, if any, by a court of competent jurisdiction. 2 0W PVS 2, LLC First Amendment to PPA Page 1 o1T DocuSign Envelope ID:54558DAA-70CD-48BF-AB79-058AOADD2591 4. Effect of Amendment. Except as expressly amended by this First Amendment,the terms and conditions of the PPA remain unchanged. 5. Capitalized Terms. All capitalized terms used in this First Amendment and not defined herein shall have the same meaning as in the PPA. 6. Scope of Amendment. This First Amendment shall be binding upon and inure to the benefit of the Parties hereto, and their respective heirs, executors, administrators, successors, and assigns, who are obligated to take any action which may be necessary or proper to carry out the purpose and intent hereof. 7. Authority. Each Party represents and warrants that as of the Effective Date: (i) it is validly existing and in good standing in the state in which it is organized, (ii) it is the proper party to amend the PPA, and(iii) it has the requisite authority to execute this First Amendment. 8. Counterparts. This First Amendment may be executed in any number of counterparts, each of which shall be deemed an original and all of which taken together shall constitute a single instrument. r i,r.6f IN WITNESS WHEREOF, the Parties hereto have caused this 1 Amendment to be duly executed as of the date above written. IDAHO POWER COMPANY PVS 2, LLC By: QJAaw IQiCUM By: IN4.. tt_40' Name: Adam Richins Name: Luigi Resta Title: SVP & Chief Operatina, Officer Title: Authorized Signatory PVS 2, LLC a D� First Amendment to PPA Page 2 ofA