20250916Comments.pdf

RECEIVED
September 16, 2025
Trion Sanger(ISB No. 12488) IDAHO PUBLIC
Sanger Greene, PC UTILITIES COMMISSION
4031 SE Hawthorne Blvd.
Portland, OR 97214
Telephone: [phone]
Fax: [phone]
[e-mail]
Attorneys for the Renewable Energy Coalition
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF IDAHO POWER ) CASE NO. IPC-E-25-22
COMPANY --APPLICATION FOR )
AUTHORITY TO UPDATE ITS ) RENEWABLE ENERGY COALITION'S
OPERATION AND MAINTENANCE ) OPENING COMMENTS
CHARGES APPLICABLE TO SCHEDULE )
72, GENERATOR INTERCONNECTIONS )
TO PURPA QUALIFYING FACILITY )
SELLERS )
I. INTRODUCTION
The Renewable Energy Coalition(the "Coalition") hereby submits its Opening
Comments to the Idaho Public Utilities Commission("IPUC" or"Commission"). Idaho Power
Company("Idaho Power") has filed an application with the Commission to modify its Schedule
72, Generator Interconnections to Public Utility Regulatory Policies Act ("PURPA") Qualifying
Facility("QF") Sellers.' Specifically, Idaho Power is proposing to modify its calculations of the
monthly operations and maintenance ("O&M") interconnection charges to QFs contained in
Schedule 72.2 The Coalition is not opining on Idaho Power's proposed revisions to its
calculations to the monthly O&M charges in Schedule 72 and reserves the right to respond to any
parties in reply comments. The Coalition is providing some background on avoided cost pricing
i See generally Application(May 8, 2025).
2 Application at 1.
RENEWABLE ENERGY COALITION'S OPENING COMMENTS
IPC-E-25-22—PAGE 1

for QFs and explain why QFs should not be charged these O&M charges under Idaho Power's
current avoided cost methodology. If the Commission authorizes Idaho Power to charge QFs the
O&M charges, then PURPA requires Idaho Power to compensate the QF for the interconnection
costs associated with Idaho Power's avoided generation resource, which Idaho Power is not
currently doing.
II. COMMENTS
Idaho Power is proposing to revise the charges it collects from QFs for interconnection
O&M. However, Idaho Power has admitted it does not account for avoided O&M costs in its
avoided cost methodology for PURPA pricing.3 Specifically, Idaho Power's avoided cost
methodology and the avoided cost rates paid to QFs do not include a payment for Idaho Power's
interconnection costs that are associated with the generation resource that Idaho Power would
have built or purchased, but for the purchase of generation from the QF. If avoided cost pricing
does not compensate the QF for Idaho Power's interconnection O&M costs, then QFs should not
be charged for the QF's O&M costs.
In 1978, Congress passed PURPA, which encouraged the development of small power
production facilities owned by independent power producers. Congress had determined that
utilities were reluctant to purchase power from small power producers. Once PURPA was
enacted, FERC promulgated rules requiring utilities to purchase QF power at a rate not
exceeding the utility's "incremental cost...of alternative electric energy,"meaning the rate that,
but for the QF purchase, the utility would otherwise pay to generate itself or purchase power
from another source.4 This rate is called the "avoided cost"rate.
3 See Idaho Power Company's Response to IdaHydro's Interrogatory No. 8 to Idaho Power
(Attachment A).
4 18 CFR § 292.101(b)(6); see also 16 USC § 824a-3(d).
RENEWABLE ENERGY COALITION'S OPENING COMMENTS
IPC-E-25-22—PAGE 2

The avoided cost rate is supposed to include the costs the utility would incur but for the
QF purchase. This would include the utility's costs for the generating facility, which includes
the facility's capacity costs, O&M costs, transmission costs, interconnection costs, any policy or
environmental compliance costs, and any other cost related to procuring a resource.
Under PURPA, the QF is generally responsible to pay the utility for interconnection costs
associated with the QF interconnecting to the utility's system.5 Interconnection costs are defined
as the"costs...incurred by the electric utility directly related to the installation and maintenance
of the physical facilities necessary to permit interconnected operations with a qualifying facility,
to the extent such costs are in excess of the corresponding costs which the electric utility would
have incurred if it had not engaged in interconnected operations,but instead generated an
equivalent amount of electric energy itself or purchased an equivalent amount of electric energy
or capacity from other sources."6
There are exceptions to this requirement. For example, the Federal Energy Regulatory
Commission("FERC") explained that interconnection"costs are limited to the net increased
interconnection costs imposed on an electric utility compared to those interconnection costs it
would have incurred had it generated the energy itself or purchased an equivalent amount of
energy or capacity from another source."' In other words, a utility may only charge a QF for the
additional, incremental expenses associated with the interconnection of the QF's resource, to the
extent those costs exceed the interconnection costs of the utility's resource that are already
reflected in the utility's avoided resource. This is essentially a matching principle: the utility can
5 18 CFR § 292.306(a).
6 18 CFR § 292.101(b)(7) (emphasis added).
7 Docket No. RM79-55, FERC Order 69, Fed. Reg. Vol. 45,No. 38 at 12217 (Feb. 25,
1980), available at: hgps://www.ferc.gov/sites/default/files/2020-04/order-69-and-
erratum.pdf.
RENEWABLE ENERGY COALITION'S OPENING COMMENTS
IPC-E-25-22—PAGE 3

require the QF to pay for all the interconnection costs associated with the QF's generation
resource,but only if the QF is compensated in its avoided cost rates for the interconnection costs
associated with the utility's generation resource.
The QF's interconnection costs would include the QF's interconnection O&M costs.
Therefore, in principle, it is appropriate for a utility like Idaho Power to charge the QF for the
O&M interconnection costs associated with the QF's interconnection. However, the QF is only
responsible for any interconnection costs that are in excess of the costs the utility would have
incurred for the avoided resource. For example, if the utility's avoided resource would have
resulted in interconnection costs of$10,but the QF interconnection costs are $25, then there are
two options under PURPA. First, the QF is responsible for$15 and is charged the excess costs
($25 in the QF's interconnection costs minus $10 in the utility's interconnection costs). Second,
the QF is charged the full $25 but compensated $10 in the avoided cost rate. The second option
is what is normally done under PURPA, the QF is charged its full interconnection costs (either in
a tariff like Schedule 72 or the actual costs),but the avoided cost rate compensates the QF for the
avoided utility interconnection costs. The first option, however, is lawful under PURPA.
Here, Idaho Power is charging QFs for the QF's interconnection O&M costs, but not
including any of Idaho Power's interconnection O&M costs in the avoided cost rates.' Idaho
Power has not demonstrated the proposed O&M interconnection charges are "in excess" of the
costs it would have incurred to procure another resource. Thus, it is inappropriate to charge the
QF for these costs without further justification from Idaho Power. Until Idaho Power can
demonstrate whether these proposed charges are for excess costs or costs the utility would have
8 See Idaho Power Company's Response to IdaHydro's Interrogatory No. 8 to Idaho Power
(Attachment A).
RENEWABLE ENERGY COALITION'S OPENING COMMENTS
IPC-E-25-22—PAGE 4

incurred with the avoided resource, the Commission should reject the O&M interconnection
charge.
III. CONCLUSION
As explained above, the Commission should reject Idaho Power's proposed O&M
interconnection charge until Idaho Power provides more explanation on the charge and Idaho
Power compensates the QFs for Idaho Power's avoided interconnection costs associated with
Idaho Power's avoided generation resource.
SANGER GREENE, PC
Irion Sanger(ISB No. 12488)
Sanger Greene, PC
4031 SE Hawthorne Blvd.
Portland, OR 97214
Telephone: [phone]
Fax: [phone]
[e-mail]
Attorney for the Renewable Energy Coalition
RENEWABLE ENERGY COALITION'S OPENING COMMENTS
IPC-E-25-22—PAGE 5

CERTIFICATE OF DELIVERY
I HEREBY CERTIFY that on this 16th day of September 2025, I caused to be served a true
and correct copy of the foregoing document upon the following individuals in the manner indicated
below:
Electronic Mail Only(See Order No. 35058):
Idaho Public Utilities Commission
Commission Secretary
secretary�ic,puc.Idaho.gov
Idaho Public Utilities Commission Staff
Jeff Loll
Deputy Attorney General
Jeff.loll&puc.idaho.gov
Idaho Power Company
Donovan Walker
Tim Tatum
Riley Maloney
dwalker&idahopower.com
dockets&idahopower.com
ttatum&idahopower.com
rmaloney&idahopower.com
IdaHydro
Tom Arkoosh
Arkoosh Law Offices
tom.arkooshkarkoosh.com
nick.erekson&akoosh.com
erin.cecil&akoosh.com
Irion A. Sanger(ISB No. 12488)
RENEWABLE ENERGY COALITION'S OPENING COMMENTS
IPC-E-25-22—PAGE 6

Attachment A
Idaho Power Company's Response to IdaHydro's
Interrogatory No. 8 to Idaho Power

INTERROGATORY NO. 8: Please explain whether Idaho Power accounts for
avoided O&M costs in its avoided cost methodology for PURPA pricing. If so, identify
where such accounting occurs. If not, explain why not.
RESPONSE TO INTERROGATORY NO. 8:
Idaho Power does not account for avoided O&M costs in its avoided cost
methodology for PURPA pricing because PURPA developments, which require additional
infrastructure to be built out or maintained, do not decrease the Company's O&M. To the
contrary, additional infrastructure being added to the Company's system inherently
increases its overall O&M costs.
The response to this Request is sponsored by Riley Maloney, Regulatory Policy
and Strategy Leader, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO IDAHYDRO'S FIRST SET OF INTERROGATORIES AND
REQUESTS FOR PRODUCTION TO IDAHO POWER COMPANY- 10