HomeMy WebLinkAbout20250905Direct Hackett.pdf RECEIVED
September 05, 2025
IDAHO PUBLIC
UTILITIES COMMISSION
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF IDAHO POWER )
COMPANY' S APPLICATION FOR ) CASE NO. IPC-E-25-27
APPROVAL OF A POWER PURCHASE )
AGREEMENT WITH BLACKS CREEK )
ENERGY CENTER, LLC. )
IDAHO POWER COMPANY
DIRECT TESTIMONY
OF
ERIC HACKETT
1 Q. Please state your name and business address .
2 A. My name is Eric Hackett . My business address
3 is 1221 West Idaho Street, Boise, Idaho 83702 .
4 Q. By whom are you employed and in what capacity?
5 A. I am employed by Idaho Power Company ("Idaho
6 Power" or "Company") as the Projects and Resource
7 Development Director.
8 Q. Please describe your educational background.
9 A. I graduated in 2003 from Boise State
10 University, in Boise, Idaho, receiving a Bachelor of
11 Science Degree in Civil Engineering. I am a registered
12 professional engineer in the state of Idaho. In 2010, I
13 earned a Master of Business Administration from Boise State
14 University.
15 Q. Please describe your work experience with
16 Idaho Power.
17 A. From 2005 to 2007, I was employed as an
18 engineer in Idaho Power' s Transmission Engineering group.
19 In 2007, I became a Project Manager leading transmission
20 and distribution line and station infrastructure projects .
21 In 2012, I was promoted to Engineering Leader where I
22 managed the Cost and Controls group supporting project
23 management . In 2015, I changed leadership roles and managed
24 the Stations Engineering and Design group as an Engineering
25 Leader. In 2018, I was promoted to Senior Manager of
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Idaho Power Company
1 Projects overseeing Project Management and Cost and
2 Controls, which later became the role of Senior Manager of
3 Projects and Design in 2021, adding Power Production Design
4 and Project Management. I was promoted to my current role,
5 Projects and Resource Development Director in 2024 . In
6 addition, I am currently leading a team of internal
7 employees and consultants in development and evaluation of
8 Idaho Power' s Request for Proposals for Peak Capacity and
9 Energy Resources .
10 Q. What is the Company' s request in this case?
11 A. Idaho Power is requesting the Idaho Public
12 Utilities Commission ("Commission") issue an order: (1)
13 approving the 25-year Power Purchase Agreement ("PPA")
14 between Blacks Creek Energy Center, LLC and Idaho Power
15 Company supplying 80 megawatts ("MW") of output from the
16 solar powered generation facility to the Company ("Blacks
17 Creek Project") , and (2) acknowledging that the resulting
18 expenses associated with the PPA are prudently incurred for
19 ratemaking purposes . The Blacks Creek Project is necessary
20 for Idaho Power to continue to provide safe, reliable
21 electric service in 2027 and beyond.
22 Q. What is the purpose of your testimony in this
23 proceeding?
24 A. The purpose of my testimony is to provide an
25 overview of the competitive resource acquisition process
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Idaho Power Company
1 undertaken to meet Idaho Power' s identified capacity
2 deficiency beginning in 2027, as described by Mr. Jared
3 Ellsworth in his testimony. First, I will provide an
4 overview of the extensive Request for Proposals ("RFP")
5 process undertaken in accordance with the Public Utility
6 Commission of Oregon' s ("OPUC") competitive bidding rules
7 that were used to evaluate the various resources that
8 competed to provide a combination of peak capacity and
9 energy resources to help meet Idaho Power' s electric energy
10 needs in 2028 . I will then explain how the resulting least-
11 cost, least-risk resources were selected through the fair
12 and competitive RFP process, including the Blacks Creek
13 Project for which Idaho Power is requesting the Commission
14 approve the PPA in this proceeding. Finally, I will
15 describe the Blacks Creek Project developer' s ability to
16 advance the commercial operation date from April 1, 2028,
17 to June 1, 2027, contributing to Idaho Power' s remaining
18 2027 capacity deficit.
19 Q. Have you prepared any exhibits?
20 A. Yes . Exhibit No. 1 is Idaho Power' s 2028 All-
21 Source Request for Proposals ("RFP") for Peak Capacity and
22 Energy Resources issued on August 16, 2024, and updated on
23 October 4, 2024 ("2028 RFP") . Confidential Exhibit No. 2
24 presents the projects resulting from the 2028 RFP that make
25 up the final shortlist of 2028 bids . Confidential Exhibit
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Idaho Power Company
1 No . 3 is London Economic International LLC' s ("LEI")
2 Closing Report: 2028 All Source Request for Proposals for
3 Peak Capacity and Energy Resources dated January 10, 2025
4 ("LEI Closing Report") . Confidential Exhibit No. 4 is the
5 Blacks Creek PPA.
6 I . BACKGROUND
7 Q. Why did Idaho Power initiate a competitive
8 request for proposals or RFP process to acquire the 2028
9 peak capacity and energy resources?
10 A. The Company' s annual capacity positions
11 developed to inform the 2023 Integrated Resource Plan
12 ("IRP") identified deficits of 138 MW of incremental
13 capacity needs in 2028 and 555 MW of supply-side resource
14 additions in the Preferred Portfolio in 2028 . Further, the
15 2023 IRP identified incremental capacity needs of 142 MW in
16 2029 and growing to over 1, 150 MW by 2038 . 1 As a result, in
17 order to meet its obligation to reliably serve customer
18 load in a least-cost, least-risk manner, Idaho Power began
19 the competitive solicitation for the acquisition of
20 resources, conducted through the issuance of the 2028 RFP.
21 The competitive RFP process allows the Company to access
22 the broader peak capacity and energy market to obtain the
23 best resources for Idaho Power' s customers, allowing for
24 access to a spectrum of potential resources and developers .
1 Idaho Power 2023 IRP at 174 (Table 11.15) .
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Idaho Power Company
1 Use of a formal RFP process provides customers and
2 regulatory agencies with the assurance that the resource
3 selection process was competitive, all potential developers
4 had an equal opportunity to participate, and that the best
5 resource alternative was selected. My testimony will
6 discuss the competitive bidding process undertaken for
7 issuance of the 2028 RFP and the evaluation of the 2028 bid
8 submittals .
9 II . COMPETITIVE BIDDING RULES
10 Q. Was Idaho Power in compliance with the
11 competitive bidding rules the Commission directed the
12 Company to follow?2
13 A. Yes . At the time the 2023 IRP identified the
14 capacity deficiencies in 2028 and beyond, the competitive
15 bidding requirements applied to resource acquisitions or
16 contracts by an electric utility for more than an aggregate
17 of 80 MW with a duration of five or more years . 3 Further,
18 they state that when an electric utility is subject to
19 competitive bidding requirements, it must engage the
20 services of an Independent Evaluator ("IE") to oversee the
21 RFP process .4
22 Q. Did the Company engage the services of an IE
23 to oversee the RFP process?
2 Case No. IPC-E-10-03.
3 Oregon Administrative Rule ("OAR") 860-089-0100 (1) .
4 OAR 860-089-0200 (1) .
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Idaho Power Company
1 A. Yes . In compliance with the rules, on February
2 29, 2024, Idaho Power commenced the competitive bidding
3 process, filing a request with the OPUC to (1) approve the
4 selection of LEI as the Independent Evaluator ("IE") for
5 the 2028 RFP, (2) approve the proposed 2028 RFP scoring and
6 modeling methodology, (3) approve the draft 2028 RFP, and
7 (4) waive certain competitive bidding rules to allow
8 expedited review and approval of the 2028 RFP. 5
9 Q. Did the OPUC approve the Company' s request to
10 engage LEI again as the IE for the 2028 RFP?
11 A. Yes . On April 30, 2024, in a public meeting,
12 the OPUC approved Idaho Power' s use of LEI as the IE again
13 for Idaho Power' s 2028 RFP and evaluation of 2028
14 resources . The OPUC also approved the concurrent review of
15 both the scoring and modeling methodologies and the draft
16 2028 RFP. 6 Over the next 15 weeks, the Company worked with
17 LEI and stakeholders to finalize the draft 2028 RFP.
18 Q. Were any significant changes made to the 2028
19 RFP following filing of the draft?
20 A. Yes . In addition to a revised draft 2028 RFP
21 filed on April 24, 2024, that incorporated minor
22 housekeeping changes, on May 17, 2024, Idaho Power filed a
23 revised draft 2028 RFP that included a new bid eligibility
5 Docket UM 2317, In the Matter of Idaho Power Company, Application for Approval
of 2028 All-Source Request for Proposals to Meet 2028 Capacity Resource Need.
6 Order No. 24-120.
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Idaho Power Company
1 requirement stating that bidders must provide evidence that
2 their proposal has a Generator Interconnection Agreement
3 ("GIA") or a Generator Interconnection application in
4 either Idaho Power' s Serial Study Process or the
5 Transitional Cluster Study Process . This GIA requirement
6 was added to reflect the Company' s new transmission
7 interconnection processes, resulting from FERC Order No.
8 2023, and was intended to mitigate potential delays in
9 delivery caused by projects encountering unexpected
10 constraints and costs when subject to a full transmission
11 study.
12 However, following feedback from stakeholders, Idaho
13 Power updated the 2028 RFP with additional details and a
14 proposed process for considering bids with later commercial
15 operation dates . The new process created three groups of
16 bids that could be submitted through the 2028 RFP process :
17 (1) bids that meet the GIA requirement and can deliver by
18 April 1, 2028, ("2028 Bids") , (2) bids that meet the GIA
19 requirement but cannot deliver by April 1, 2028, and (3)
20 bids that do not meet the GIA requirement. The Company
21 developed Exhibit R - Supplemental 2029 and Later
22 Requirements into the draft 2028 RFP, outlining the
23 requirements for those bids with a commercial operation
24 date after April 2028 . Bids that meet the GIA requirement
25 but cannot deliver by April 1, 2028, and bids that do not
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Idaho Power Company
I meet the GIA requirement will be referred to as Beyond
2 April 2028 Bids in my testimony.
3 Q. Was it Idaho Power' s intent to evaluate the
4 2028 Bids alongside the Beyond April 2028 Bids?
5 A. No. The revised draft 2028 RFP also indicated
6 that evaluation of the bids would be bifurcated, with
7 prioritization of the 2028 Bids in order to meet summer
8 peak in 2028, or Group One bids, followed by evaluation of
9 the Beyond April 2028 Bids, or Group Two bids . The revised
10 draft 2028 RFP included a modified schedule that separated
11 the evaluation into two overlapping bid evaluations .
12 Q. What resources did the final draft 2028 RFP
13 target for procurement?
14 A. The final draft 2028 RFP targeted resource
15 procurements consistent with the incremental capacity
16 deficiencies identified in the 2023 IRP, or 138 MW of
17 incremental peak capacity needs in 2028, 142 MW in 2029,
18 and growing to over 1, 150 MW by 2038 . 7 Accordingly, the All-
19 Source 2028 RFP sought proposals for a combination of
20 capacity and energy resources that provide a minimum of
21 approximately 138 MW of incremental peak capacity and 555
22 MW of supply-side resource additions in 2028 and beyond.
23 Idaho Power accepted bids for energy or capacity
24 incremental to its system beginning in the summer 2028
7 Idaho Power 2023 IRP at 174 (Table 11.15) .
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Idaho Power Company
I timeframe and beyond, from market energy purchases or new
2 or existing resources .
3 Q. Did the final draft 2028 RFP contemplate
4 benchmark resources?
5 A. Yes . In fact, the competitive bidding rules
6 require that, prior to the opening of bidding of an
7 approved RFP, the Company submit to the IE, for review and
8 comment, a detailed score for any benchmark resource with
9 supporting cost information, any transmission arrangements,
10 and all other necessary information to score the benchmark
11 resource. The rules require Idaho Power to apply the same
12 assumptions and bid scoring and evaluation criteria to the
13 benchmark bid that are used to score other bids .
14 In addition, as required by OAR 860-089-0300, the
15 Company identified a separate team of Idaho Power staff and
16 retained consultants ("Internal Bid Team") to submit
17 resource-based product bids, or benchmark bids . As such,
18 the Company instituted a Separation of Functions protocol
19 where the evaluation of bids would be performed by a
20 separate team of Idaho Power staff and retained consultants
21 with relevant subject matter expertise ("Evaluation Team")
22 to work directly with the IE. This Separation of Functions
23 protocol was developed with the purpose of defining
24 specific roles and responsibilities and outlined policies
25 and procedures to be maintained as a living document to
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Idaho Power Company
1 ensure the Evaluation Team and Internal Bid Team operate
2 separately, and no access to any non-public information
3 that might unfairly disadvantage one bidder over another is
4 shared.
5 So, when the final draft 2028 RFP was filed with the
6 OPUC, the Company indicated it would submit a detailed
7 score for the benchmark resources, with supporting cost
8 information, to the Commission and IE for review of
9 reasonableness, before opening market bids . Then, when the
10 2028 RFP was issued, Idaho Power would submit benchmark
11 resource proposals, providing a potential cost-based
12 alternative for customers .
13 Q. Did LEI or OPUC Staff memorialize their review
14 of the final draft 2028 RFP?
15 A. Yes . Subsequent to the Company' s filing of the
16 final draft 2028 RFP, on May 28, 2024, LEI provided
17 observations and recommendations to the draft 2028 RFP as
18 well as a summary of stakeholders' comments, ultimately
19 recommending five improvements to be incorporated into the
20 final RFP that would make the solicitation process clearer
21 and more transparent to stakeholders . 8 The Company
22 incorporated the feedback received from stakeholders into
23 the 2028 RFP and on July 16, 2024, posted on its website
8 London Economic International LLC's Observations on Idaho Power Company's
Draft 2028 All-source Request for Proposals for Peak Capacity and Energy
Resources: Independent Evaluator Assessment Report dated May 28, 2024.
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Idaho Power Company
1 and filed with the OPUC a revised draft 2028 RFP.
2 On July 29, 2024, OPUC Staff submitted their report
3 detailing their analysis of the draft 2028 RFP and the
4 associated scoring and modeling methodology and
5 recommending Commission approval, which was followed by the
6 Second IE Assessment Report on August 2, 2024 . A Special
7 Public Meeting was held on August 15, 2024, to discuss the
8 draft 2028 RFP and associated scoring and modeling
9 methodology. The OPUC directed Idaho Power to include
10 language in the 2028 RFP to clarify that in the event of a
11 material change in law that requires repricing, the
12 opportunity to rebid would be available to all bidders in
13 the same timeline, and ultimately approved the 2028 RFP
14 with OPUC Order No. 24-272 . As a result, Idaho Power
15 formally issued the 2028 RFP on August 16, 2024 . The final
16 2028 RFP is included as Exhibit No . 1 to my testimony.
17 III . THE 2028 RFP
18 Q. What was the intent of the resources sought
19 through the 2028 RFP?
20 A. Through the 2028 RFP, the Company' s intent
21 was to solicit bids for two types of electric energy and
22 capacity products : (1) resource-based proposals, and (2)
23 market purchase proposals . Resource based proposals are
24 unit-contingent energy where capacity is delivered from
25 specific electric resources . Market purchase proposals are
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Idaho Power Company
1 firm energy proposals that are required to meet the
2 eligibility requirements of the Western Resource Adequacy
3 Program in terms of resource specificity, transmission, and
4 other requirements . The eligible products included asset
5 purchases, PPA' s, and battery storage agreements with
6 exclusive ownership by the Company of any and all
7 environmental attributes associated with the energy
8 generated. The 2028 RFP process did not restrict bids based
9 on resource type or ownership structure. That is, the 2028
10 RFP allowed bids for all commercially viable resource types
11 that could meet the specified commercial operation date .
12 Q. When were responses to the 2028 RFP due?
13 A. As I discussed earlier in my testimony, the
14 bid responses were bifurcated, with evaluation of the 2028
15 Bids, or Group One, prioritized in order to meet summer
16 peak in 2028, followed by evaluation of the Beyond April
17 2028 Bids, or Group Two bids . 9 Because Idaho Power' s request
18 in this case is specific to a 2028 Bid, my testimony will
19 only be discussing the evaluation process associated with
20 the 2028 Bids . Group One responses to the 2028 RFP were due
21 to Idaho Power via the Zycus portal on September 17, 2024 .
22 The 2028 RFP was well received, with 95 proposals from 19
23 different bidders, with a total of 147 resource bids
9 Note, on August 19, 2025, the OPUC issued Order No. 25-327 acknowledging Idaho
Power's final shortlist of Beyond April 2028 Bids, or Group Two bids, which
included a combination of gas, solar, wind and energy storage resources.
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Idaho Power Company
1 summing to more than 27 gigawatts ("GW") of resources in
2 Group One. Notably, two developers submitted more than 10
3 resource-based proposals, with the highest number of
4 proposals from a single company reaching 18 . No market
5 purchase proposals were received. Approximately 58 percent
6 of the bids incorporated solar photovoltaic ("PV")
7 resources within their portfolios, and approximately 39
8 percent incorporated energy storage. The following
9 summarizes the bids by resource type:
10 Table 1 — Bids by Resource Type
Resource Type Number of Bids
Wind 2
Wind + Battery Energy Storage 1
Systems ("BESS")
Solar PV 35
Solar PV + BESS 39
BESS 15
Gas to Hydrogen + BESS 1
Solar PV + Wind + BESS 1
Energy + BESS 1
Total 95
11 The resource capacity proposals presented varied in
12 structure, featuring power purchase agreements, battery
13 storage agreements, and asset purchases . The following
14 summarizes the 2028 Bids by ownership structure:
15 Table 2 — Proposals by Ownership
Owner Number of Proposals
Bidder 75
Idaho Power 16
Mixed 4
Total 95
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Idaho Power Company
1 Q. Did Idaho Power receive any benchmark bids
2 from the Internal Bid Team?
3 A. Yes . On August 23, 2024, before third-party
4 bids were due, the Company received four benchmark bids
5 across three sites from the Internal Bid Team. Idaho Power
6 reviewed the benchmark bids for conformity with minimum bid
7 eligibility requirements and scored the non-price factors,
8 and submitted the scores to LEI, which was completed prior
9 to the Evaluation Team opening the third-party bids on
10 September 17, 2024 . 10
11 Q. Please explain the first step in the bid
12 evaluation process .
13 A. The bid evaluation and selection process are
14 designed to identify the combination and size of the
15 proposed resources that will maximize the customer benefits
16 and will satisfy the projected resource capacity and energy
17 needs while maintaining reliability. As described in the
18 2028 RFP, Section 7 . 2 Phase 1 - Initial Shortlist, eligible
19 bids were evaluated to identify a subset of bids that would
20 be advanced for further evaluation. Each bid was ranked
21 within the respective technology group based on its pricing
22 and non-pricing scores .
23 Q. Were the pricing and non-pricing scores
24 determined in accordance with the scoring methodology you
10 OAR 860-089-0350.
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Idaho Power Company
1 described earlier in your testimony that was reviewed and
2 approved under the competitive bidding rules?
3 A. Yes . The scoring methodology was consistent
4 and prescriptive as described in the 2028 RFP. Based on the
5 diversity of technologies bid into the RFP, and to ensure
6 fair and equitable evaluation of the bids, the Company
7 identified the need to group bids by their specific
8 technology and developed an initial shortlist within each
9 disparate technology group.
10 Initial Shortlist
11 Q. What considerations were made to develop the
12 initial shortlist by technology group?
13 A. All eligible bids were evaluated, and a
14 combined price and non-price score was established for each
15 technology grouping. Idaho Power desired a reasonable and
16 diversified quantity of projects that represented each
17 technology category meeting the following principles : (1)
18 minimum of three bidders/projects where sufficient bids
19 were included, (2) sufficient capacity/energy quantity to
20 meet the stated needs of the 2028 RFP, (3) technology
21 categories that only had one bid were automatically moved
22 forward to the initial shortlist, and (4) step increases to
23 price and total score were utilized as a natural cutoff.
24 The highest ranking and relatively lowest cost bids within
25 each technology category moved forward to the initial
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Idaho Power Company
1 shortlist .
2 During this process, the Company identified
3 pertinent information for seven proposals from two
4 different bidders that removed them from further evaluation
5 and excluded them from the initial shortlist. Before the
6 initial shortlist was finalized, on October 11, 2024, Idaho
7 Power provided its updated bid eligibility and confidential
8 initial shortlist to LEI . The IE documented their initial
9 evaluation and scoring of conforming bids, providing a
10 confidential review of eligibility and initial shortlist
11 report on November 1, 2024 . LEI stated they found that the
12 Company' s "approach was reasonable, and the process was
13 conducted in a fair and impartial manner. ""
14 Q. How many proposals made up the resulting
15 initial shortlist?
16 A. The initial shortlist, which included all
17 projects found to be conforming by both Idaho Power and
18 LEI, included 42 projects from 19 bidders, consisting of 15
19 facilities across seven technologies . Next, consistent with
20 the bid evaluation and selection process outlined in the
21 2028 RFP, additional analyses and due diligence of the
22 initial shortlist was performed to identify and select
11 Review of eligibility and initial shortlist of The 2028 All Source Request
for Proposals for Peak Capacity and Energy Resources: Initial Shortlist of bids
submitted for projects coming online no later than 2028, dated November 1,
2024, page 5.
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Idaho Power Company
1 projects on the final shortlist.
2 Final Shortlist
3 Q. What additional analyses and due diligence was
4 performed on the initial shortlist projects to create the
5 final shortlist?
6 A. First, in accordance with the competitive
7 bidding rules, 12 Idaho Power retained the services of
8 Hendrickson Renewables, LLC ("Hendrickson") to provide an
9 independent third-party review of site-specific critical
10 performance factors for wind and solar resources, including
11 but not limited to: (1) an evaluation of the Variable
12 Energy Resource assessments submitted with each applicable
13 proposal, (2) quantification of any potential impact on
14 energy production, and (3) adjustment, if any, to the P50
15 Net Capacity Factor ("NCF") including the associated
16 confidence level where differences are identified. The
17 Company incorporated Hendrickson' s proposed adjusted NCF' s,
18 as applicable, into the Aurora model for the wind and solar
19 resource types, as part of the final shortlist selection
20 process .
21 Q. What modeling was performed of the initial
22 shortlist projects?
23 A. Idaho Power utilized Aurora, which allows for
24 the use of a consistent common evaluation tool with
12 OAR 860-089-0400 (5) (a) .
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Idaho Power Company
I consistent common assumptions in that tool, for reasonable
2 evaluation results, and the relative ranking of the initial
3 shortlist project submittals to better identify those
4 projects that best meet the Company' s resource needs . Idaho
5 Power created eight Aurora scenarios to help compile the
6 final shortlist. The eight scenarios were created to
7 capture a wide range of Boardman to Hemingway transmission
8 line online dates, natural gas price futures, carbon price
9 futures, large load demand futures, and revised
10 Environmental Protection Agency carbon emissions rules on
11 potential new gas fired power plants . These scenarios were
12 discussed and developed with the IE and OPUC Staff prior to
13 their use in final shortlist modeling. Projects selected
14 across the eight Aurora scenarios were considered for
15 inclusion on the final shortlist.
16 Q. What were the modeling results of the initial
17 shortlist projects under the eight Aurora scenarios?
18 A. Table 3 below presents projects selected at
19 least once across the eight Aurora scenarios and considered
20 for inclusion on the final shortlist.
21
22
23
24
25
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Idaho Power Company
1 Table 3 . Projects Selected in Aurora Modeling Scenarios .
2028 Resources
178 . 6 Wind
330 MW Solar
400 MW Solar
80 MW Solar
149 MW Solar
150 MW BESS
200 MW BESS
110 MW Gas + 110 MW BESS
2 All projects selected from the eight Aurora
3 scenarios were moved forward and included on the final
4 shortlist . After the final shortlist was derived from the
5 Aurora scenarios, Idaho Power performed a portfolio
6 sensitivity analysis on the aforementioned final
7 shortlisted projects .
8 Q. What is the intention of the portfolio
9 sensitivity analysis?
10 A. The intention of the portfolio sensitivity
11 process is to assess the final shortlisted projects and how
12 their impacts to portfolio costs compare to each other in
13 potential variable futures . This sensitivity analysis
14 informs the comparative ranking of final shortlist projects
15 to each other. Confidential Exhibit No. 2 provides the
16 results of the ranking of the final shortlist projects .
17 Q. Did Idaho Power receive approval from the OPUC
18 of the final shortlist of 2028 Bids?
19 A. Yes . On January 10, 2025, in accordance with
20 OAR 860-089-0500, Idaho Power filed with the OPUC in Docket
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Idaho Power Company
1 UM 2317 a request for acknowledgment of the 2028 Bids final
2 shortlist resulting from the 2028 RFP, along with the LEI
3 Closing Report, included as Confidential Exhibit No. 3,
4 which outlines the entire procurement process and extensive
5 bid evaluation. In the LEI Closing Report, the IE attested
6 to the reasonableness of the Company' s approach in
7 identifying 2028 Bids for the final shortlist, indicating
8 " [t] he process was conducted with the utmost fairness and
9 impartiality, upholding the integrity of the selection
10 process . "13 On March 31, 2025, the OPUC issued Order No . 25-
11 128 approving the Company' s final shortlist of 2028 Bids
12 with four conditions : (1) the OPUC acknowledged the final
13 shortlist volume up to 216 MW of peak capacity to meet the
14 2028 capacity needs demonstrated by Idaho Power, but
15 ordered the Company to file a report with an explanation
16 and justification for any procurement volume in excess of
17 those amounts, (2) the Company must retain the IE to
18 monitor and report on all contract negotiations, filing a
19 final report in Docket UM 2317, (3) remove the gas to
20 hydrogen plus BESS project from the final shortlist,
21 reevaluating the project with Group Two bids, and (4) in
22 their contract negotiations report, the IE must report on
23 the effect of Group Two bids on the negotiation process .
24
13 LEI Closing Report, page. 8.
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Idaho Power Company
1 Q. Why did the OPUC direct the Company to remove
2 the gas to hydrogen plus BESS project from the final
3 shortlist of 2028 Bids?
4 A. The Company included the proposal on the final
5 shortlist of 2028 Bids acknowledgement request to the OPUC.
6 During the OPUC review of the gas to hydrogen plus BESS
7 project, LEI expressed concerns with the
8
9
10
11 _ . Upon further review and evaluation of the bid, the
12 Company agreed with this assessment finding the
13
14
15
16 final shortlist to be insufficient. Ultimately, the OPUC
17 indicated Idaho Power did not demonstrate that the benefits
18 outweigh the known project uncertainties and recommended
19 the removal of the project from the final shortlist of 2028
20 Bids . 14
21
22
i4 While the Company did move the gas to hydrogen plus BESS project to Group
Two, ultimately the developer confirmed uncertainties associated with the
commercial operation date and requested the project be evaluated at a later
date. As a result, the project was not evaluated alongside the 2028 and 2029
resource bids for which the OPUC approved the Beyond April 2028 Bids final
shortlist with Order No. 25-327.
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Idaho Power Company
1 IV. PROJECT NECESSARY TO FILL IDENTIFIED CAPACITY DEFIENCY
2 Q. Has Idaho Power executed any agreements
3 associated with the final shortlist of 2028 Bids?
4 A. Yes . Following identification of the most
5 cost-effective 2028 Bids resulting from the 2028 RFP, the
6 Company began negotiations with developers for procurement
7 of the resources necessary to meet the identified 2028
8 capacity deficit. Through successful negotiations, Idaho
9 Power and Blacks Creek Energy Center, LLC, have executed
10 the PPA associated with the Blacks Creek Project, an 80 MW
11 solar PV facility that supplies energy to the Company' s
12 system.
13 Q. You indicated the Blacks Creek Project was
14 identified on the final shortlist of 2028 Bids but in his
15 Direct Testimony, Mr. Ellsworth indicates the project is
16 necessary to contribute to the remaining 2027 capacity
17 deficiency of 143 MW. What is the expected commercial
18 operation date of the Blacks Creek Project?
19 A. The Blacks Creek Project was selected on the
20 final shortlist of 2028 Bids with a commercial operation
21 date of April 1, 2028 . The developer, who also has an
22 existing 320 MW solar project that is subject of a Clean
23 Energy Your Way PPA under the Brisbie special contract, ls
is The 320 MW Blacks Creek Clean Energy Your Way PPA was reviewed and approved
by the Commission in Case No. IPC-E-24-42, Order No. 36572, April 24, 2025.
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Idaho Power Company
1 had latent capacity under the existing GIA and therefore
2 bid the 80 MW Blacks Creek Project into the 2028 RFP.
3 Because of the existing, executed PPA for the 320 MW solar
4 PV facility, and the existing GIA, contract negotiations
5 for the Blacks Creek Project progressed quicker than those
6 of other 2028 Bids on the final shortlist. It was during
7 these initial contract negotiations that the developer
8 indicated the ability to advance the commercial operation
9 date of the Blacks Creek Project from April 1, 2028, to
10 June 1, 2027 . In addition to benefiting Idaho Power by
11 contributing to the remaining 2027 capacity deficit, the
12 developer is able to ensure the project is eligible for
13 investment tax credits that are expected to sunset on
14 December 31, 2027 .
15 Blacks Creek Power Purchase Agreement
16 Q. Please provide an overview of the Blacks Creek
17 PPA.
18 A. The Blacks Creek PPA is a 25-year PPA between
19 Blacks Creek Energy Center, LLC, and Idaho Power. Under the
20 terms of the PPA, Blacks Creek Energy Center, LLC, will
21 construct, own, operate and maintain a solar powered
22 generation facility located in Ada County, Idaho, with an
23 expected nameplate capacity of 80 MW, supplying the output
24 to the Company. An executed copy of the PPA is included as
25 Confidential Exhibit No. 4 to my testimony. The PPA
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Idaho Power Company
1 contains levelized, fixed pricing for the 25-year term.
2 Exhibit 5 to the PPA sets forth the Contract Price for
3 Contract Years 1 through 25 on a dollars per megawatt-hour
4 ("MWh") basis . The PPA is similar in many ways to the
5 numerous energy sales agreements approved by the Commission
6 pursuant to the Company' s obligations under the Public
7 Utility Regulatory Policies Act of 1978 ("PURPA") , but also
8 contains additional other terms and conditions consistent
9 with industry standard, non-PURPA power purchase agreements
10 including pricing, security, and other terms of service .
11 Q. Does the PPA provide for any assurances or
12 guarantees related to the commercial operation date of June
13 1, 2027, and ongoing operation of the solar powered
14 generation facility?
15 A. Yes . Section 4 of the PPA details the term and
16 commercial operation date, providing for a Guaranteed
17 Commercial Operation Date, which is 180 days after the
18 Scheduled Commercial Operation Date of June 1, 2027 . In
19 addition, Section 9 of the PPA contains provisions
20 requiring the Seller to post and maintain security, both
21 Project Development Security and Default Security. A
22 Project Development Security in the amount of - per
23 MW of Nameplate Capacity Rating must be in place within 30
24 days of a final order of the Commission approving the PPA
25 and will remain in place to ensure the project meets its
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Idaho Power Company
1 Commercial Operation Date. On or before the Commercial
2 Operation Date, a Default Security in the amount of -
3 per MW of Nameplate Capacity Rating must be in place until
4 the PPA expires . Default Security may be used for any
5 Deficit Damages if commercial operation is not achieved on
6 or before the Scheduled Commercial Operation Date or if the
7 PPA is terminated because of the Seller ' s default.
8 Q. Does the PPA contain any performance
9 guarantees?
10 A. Yes . Section 7 . 12 of the PPA contains a
11 performance requirement in the form of an Output Guarantee .
12 Under the Output Guarantee, the Seller is obligated to
13 deliver the sum of 90 percent of the Estimated Net Output
14 Amount of the Facility for the month, less any quantities
15 not delivered in such month constituting Seller
16 Uncontrollable Minutes . If the quantity of Net Output
17 delivered during any full calendar quarter is less than the
18 Output Guarantee, the Seller must make an Output Shortfall
19 payment, outlined in Exhibit 4 of the PPA.
20 In addition, Section 7 of the Agreement contains
21 standard provisions for operation and control of the
22 project. These include such things as planned outages,
23 maintenance outages, and forced outages, as well as
24 scheduling, forecasting, nameplate capacity increase
25 limitations, and metering. For forecasting, the PPA
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Idaho Power Company
1 specifies that Idaho Power will administer the solar
2 forecasting model and the Seller is responsible for an
3 allocated portion of the total costs of the forecasting
4 model .
5 Q. Will Idaho Power take ownership of any Green
6 Tags or Environmental Attributes associated with the Blacks
7 Creek Project?
8 A. Yes . Under the PPA, Idaho Power will own 100
9 percent of the Green Tags and Environmental Attributes
10 associated with the solar PV facility.
11 Q. When will the PPA become effective?
12 A. Section 3 . 1 provides that the PPA will not
13 become effective unless the Commission has approved all the
14 PPA' s terms and provisions and declared that all payments
15 the Company makes to Seller for purchases of energy will be
16 allowed as prudently incurred expenses for ratemaking
17 purposes . This section also provides that subsequent to
18 execution of the PPA, Idaho Power will seek a final order
19 regarding approval or rejection of the Agreement from the
20 Commission, and that if Commission approval is not obtained
21 within six months, the Scheduled Commercial Operation Date
22 and Guaranteed Commercial Operation Date, may be extended
23 on a day-for-day basis until approval is obtained. Should
24 Commission approval not be obtained within 12 months, then
25 Idaho Power or the Seller have the right to terminate the
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Idaho Power Company
1 Agreement .
2 Q. Does the PPA contain any provisions associated
3 with changes in existing import tariffs?
4 A. Yes . Section 6 . 1 of the Blacks Creek PPA
5 includes provisions associated with New Tariffs or
6 increases or decreases to existing import tariffs . The
7 provisions provide that if
8
9
10
11
12
13
14 Q. Did the Company consider how the economics of
15 the Blacks Creek PPA, with the inclusion of provisions
16 associated with new tariffs or changes to existing import
17 tariffs, compared to the other projects on the final
18 shortlist?
19 A. Yes . First, with respect to projects bid into
20 the 2026 RFP which solicited resources with both 2026 and
21 2027 commercial operation dates, there were no other viable
22 projects able to meet the June 1, 2027, commercial
23 operation date . With a remaining 2027 capacity deficit of
24 143 MW, the Blacks Creek Project is necessary to continue
25 to provide safe, reliable electric service in 2027 and
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Idaho Power Company
1 beyond. With respect to the remaining 2028 Bids on the
2 final shortlist, Idaho Power anticipates that in light of
3 uncertainties around both new and existing import tariffs,
4 Sellers would have requested similar treatment and
5 protections and future contracts would have also included
6 provisions to protect both the Seller and the Company from
7 any tariff changes that may occur following execution, and
8 therefore would not expect changes to the rankings of the
9 2028 Bids on the final shortlist.
10 Q. Does Idaho Power believe the competitive
11 bidding process has determined the least-cost, least-risk
12 resources to meet the Company' s identified capacity
13 deficiencies?
14 A. Yes . The approval of the 2028 Bids final
15 shortlist for procurement of resources under the
16 competitive bidding rules is an extensive process, even on
17 the expedited basis requested by the Company, spanning
18 nearly 13 months, that employs a fair and competitive 2028
19 RFP process . This 13-month timeline was solely related to
20 the 2028 RFP process and diligence; it did not include
21 contract negotiation, contract execution, material
22 procurement, and construction, which can take another two
23 to six years, depending on the resource. The RFP process
24 began with the engagement of an IE, with participation from
25 OPUC Staff and stakeholders throughout, and involved a
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Idaho Power Company
1 comprehensive eligibility screening process, the meticulous
2 assessment and scoring of the resource bids, including
3 benchmark resources, and a rigorous scenario analysis
4 followed by a portfolio sensitivity analysis of the final
5 shortlist . At the end of the process, the Company' s IE
6 attested to the reasonableness of Idaho Power ' s approach in
7 identifying bids for the 2028 Bids final shortlist and
8 stated the process was conducted with the utmost fairness
9 and impartiality, upholding the integrity of the selection
10 process . 16
11 To meet the identified capacity deficiencies, the
12 Company used the results from the 2028 Bids final
13 shortlist, identifying the cost-effective projects selected
14 through the extensive competitive bidding process . The
15 resources presented in my testimony are necessary and
16 required to timely meet the Company' s resource needs and
17 continue to provide reliable and adequate service to Idaho
18 Power' s customers starting in the summer of 2027 and into
19 the future.
20 V. CONCLUSION
21 Q. Please summarize your testimony.
22 A. Idaho Power initiated the 2028 RFP process on
23 February 29, 2024, and in accordance with the OPUC
24 competitive bidding rules, in order to provide peak
16 LEI Closing Report.
HACKETT, DI 29
Idaho Power Company
1 capacity and energy resources to help meet the Company' s
2 peak electric energy needs in 2028 . One of the resources
3 selected through the fair and competitive procurement
4 process includes the Blacks Creek Project, an 80 MW solar
5 PV facility that supplies energy to the Company via the
6 Blacks Creek PPA, providing for a least-cost and least-risk
7 resource necessary for contributing to the remaining 2027
8 capacity deficiency.
9 Q. Does this conclude your testimony?
10 A. Yes .
11
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Idaho Power Company
1 DECLARATION OF ERIC HACKETT
2 I, Eric Hackett, declare under penalty of perjury
3 under the laws of the state of Idaho:
4 1 . My name is Eric Hackett. I am employed by
5 Idaho Power Company as the Projects and Resource
6 Development Director.
7 2 . On behalf of Idaho Power, I present this
8 pre-filed direct testimony and Exhibit No. 1 and
9 Confidential Exhibit Nos . 2 through 4 in this matter.
10 3 . To the best of my knowledge, my pre-filed
11 direct testimony and exhibits are true and accurate .
12 I hereby declare that the above statement is true to
13 the best of my knowledge and belief, and that I understand
14 it is made for use as evidence before the Idaho Public
15 Utilities Commission and is subject to penalty for perjury.
16 SIGNED this 5th day of September 2025, at Boise,
17 Idaho .
18 �rUL
19 Signed:
20 Eric Hackett
21
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Idaho Power Company