20251017Reply Comments - Redacted.pdf

w@10AW POWER@
RECEIVED
DONOVAN WALKER October 17, 2025
Lead Counsel IDAHO PUBLIC
dwalker(a-)_idahopower.com UTILITIES COMMISSION
October 17, 2025
Commission Secretary
Idaho Public Utilities Commission
11331 W. Chinden Blvd., Bldg 8,
Suite 201-A (83714)
PO Box 83720
Boise, Idaho 83720-0074
Re: Case No. IPC-E-25-10
Idaho Power Company's Application for Approval of a Power Purchase
Agreement and an Energy Storage Agreement with Crimson Orchard Solar
LLC
Dear Commission Secretary:
Attached for electronic filing is Idaho Power Company's Reply Comments in the
above-referenced matter. The confidential version will be provided in a separate email to
the parties who have signed the Protective Agreement.
If you have any questions about any of the aforementioned documents, please do
not hesitate to contact me.
Very truly yours,
�1�-2z;.--z 2 66)&.P-
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
In the Matter of Idaho Power Company's Application for Approval of a Power
Purchase Agreement and an Energy Storage Agreement with Crimson Orchard
Solar LLC
Case No. IPC-E-25-10
The undersigned attorney, in accordance with Commission Rules of Procedure
67, believes that Idaho Power Company's Reply Comments, dated October 17, 2025,
contains information that Idaho Power and/or a third-party claim constitutes trade
secrets or other confidential business records, and/or other non-public records exempt
from disclosure under state or federal law including but not limited to Idaho Code § 48-
801, et seq.; Idaho Code § 74-101, et seq.; and/or U.S. Code of Federal Regulations
Title 17." As such, it is protected from public disclosure, inspection, examination, or
copying.
DATED this 17th day of October 2025.
Donovan E. Walker
Attorney 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: [phone]
Facsimile: [phone]
dwalker(a-)_idahopower.com
Attorney for Idaho Power Company
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF IDAHO POWER )
COMPANY'S APPLICATION FOR ) CASE NO. IPC-E-25-10
APPROVAL OF A POWER PURCHASE )
AGREEMENT AND AN ENERGY STORAGE ) IDAHO POWER COMPANY'S
AGREEMENT WITH CRIMSON ORCHARD ) REPLY COMMENTS
SOLAR LLC. )
COMES NOW, Idaho Power Company ("Idaho Power" or "Company"), and,
pursuant to Idaho Public Utilities Commission's ("Commission") Rules of Procedure 201-
204 and the Notice of Modified Procedure, Order Nos. 36577 and 36755, hereby
respectfully submits the following Reply Comments in response to Initial Comments filed
by Commission Staff ("Staff") and the Idaho Irrigation Pumpers Association, Inc. ("IIPA")
on August 1 , 2025, and Supplemental Comments filed by Staff and Updated Comments
filed by IIPA on October 3, 2025.
IDAHO POWER COMPANY'S REPLY COMMENTS - 1

Idaho Power initially brought this matter before the Commission through its
Integrated Resource Plan ("IRP") which identified a need for additional resources and
subsequently followed the fair and competitive resource acquisition process. The
Company solicited resources through a Request for Proposal ("RFP") which concluded
with execution of two least-cost least-risk projects that could meet Idaho Power's resource
needs in 2027: the Jackalope Wind Project and the Crimson Orchard Project. Idaho
Power negotiated the agreements for the projects in accordance with the laws in place at
the time and the commonly accepted industry terms at the time.
After those initial agreements were executed,
, which led to the First Amendment to the Power Purchase Agreement
("PPA") and the First Amendment to the Energy Storage Agreement ("ESA"),-
The First
Amendments
Finally, the First Amendments
IDAHO POWER COMPANY'S REPLY COMMENTS - 2

The record in this proceeding clearly shows Idaho Power's prudent actions,
following the Commission's processes and procedures required for this resource
acquisition. Staff agrees with the identified 2027 capacity need and, although they
declined to participate in the nearly 18-month long process, Staff agreed that a
competitive solicitation process occurred, resulting in the identification of the least-cost,
least-risk resources necessary to meet the identified need, including the Crimson Orchard
Project. Staff's criticism of decisions made by Idaho Power, suggesting these decisions
led to only one remaining viable project, are unreasonable. Contrary to assertions made
by Staff,
M. For these reasons, the Commission should approve the Crimson Orchard PPA
and ESA and the First Amendments to both, acknowledging the resulting expenses are
prudently incurred for ratemaking purposes.
I. BACKGROUND
1. Idaho Power constantly monitors resource needs, and in the face of growing
loads and deficits has responded with added and appropriate urgency to acquire
additional low-cost, reliable sources of generation and capacity, as evidenced by Idaho
Power's consecutive requests for Certificates of Public Convenience and Necessity
("CPCN") to acquire resources to be online in 2023,E 2024,2 2025,3 2026,4 and 2027.5
The Company expects to acquire additional resources through at least 2028. In response
Case Nos. IPC-E-22-06 and IPC-E-22-13.
2 Case Nos. IPC-E-23-05 and IPC-E-23-20.
3 Case Nos. IPC-E-22-29 and IPC-E-23-20.
4 Case Nos. IPC-24-01, IPC-E-24-16, and IPC-E-24-45.
5 Case Nos. IPC-E-24-42 and IPC-E-25-27.
IDAHO POWER COMPANY'S REPLY COMMENTS - 3

to identified resource needs in 2026 and 2027, on September 15, 2022, Idaho Power
conducted a competitive solicitation through the issuance of an All-Source Request for
Proposal ("RFP") seeking to acquire a combination of energy and capacity resources.
The Company did not define the type of resource (i.e., gas, wind, solar, or battery storage)
desired; however, Idaho Power outlined that the deficit could require as much as 1,100
megawatts (WW") of variable energy resources and a minimum of 350 MW of peak
capacity to help meet the Company's previously identified capacity needs in 2026 and
2027 ("2026 RFP"). After performing a detailed analysis of the bids that were submitted
and presenting the results to the Public Utility Commission of Oregon ("OPUC"), a final
shortlist representing the least-cost, least-risk resources was approved by the OPUC on
February 22, 2024.
2. The bid evaluation process of the project proposals submitted through the
2026 RFP is designed to identify the combination and size of the proposed resources that
will maximize customer benefits while ensuring Idaho Power meets its energy and
capacity needs. Upon conclusion of the approximately 15-month mandated competitive
bidding rule-compliant process, the Company began negotiations with developers for
procurement of the resources necessary to meet the identified 2027 capacity deficit.
Initial Application
3. On February 7, 2025, Idaho Power executed agreements associated with
one of the remaining cost-effective projects that was able to meet the June 1, 2027,
commercial operation date, the Crimson Orchard Project, consisting of the standalone
Crimson Orchard Power Purchase Agreement ("PPA") and the standalone Crimson
Orchard Energy Storage Agreement ("ESA"). The project includes (1) a 100 MW solar
IDAHO POWER COMPANY'S REPLY COMMENTS -4

photovoltaic ("PV") facility that supplies energy to either the battery storage facility or the
Company's system, and (2) the battery storage facility, supplying 100 MW of capacity to
Idaho Power, (collectively the "Crimson Orchard Project"). The total output of the Crimson
Orchard Project is 100 MW.
4. On March 13, 2025, Idaho Power submitted an Application to the
Commission for an order: (1) approving the 20-year PPA between Crimson Orchard Solar
LLC ("Crimson Orchard") and Idaho Power, (2) approving the 20-year ESA between
Crimson Orchard and Idaho Power, and (3) acknowledging the lease accounting
necessary to facilitate the transaction and that the resulting expenses associated with
both the PPA and the ESA are prudently incurred for ratemaking purposes.
5. On August 1, 2025, Initial Comments were filed by Staff and IIPA. In their
Initial Comments, Staff recommends the Commission (1) approve both the Crimson
Orchard PPA and ESA and the associated future payments as prudent expenditures, with
the exception of any Purchase Options, which, if exercised, a prudence determination
should be pursued at that time, (2) direct the Company to amend the agreement terms to
require Commission approval for substantive contract modification, and (3) acknowledge
the use of lease accounting for the ESA.6 In their Initial Comments, the IIPA however,
recommends the Commission (1) deny the Crimson Orchard PPA, (2) deny the Crimson
Orchard ESA, and (3) decline to acknowledge the lease accounting is necessary to
facilitate the transaction and that the resulting expenses associated with both the PPA
and ESA as prudently incurred for ratemaking purposes. In the event the Commission
6 Staff Initial Comments, page 7.
IDAHO POWER COMPANY'S REPLY COMMENTS - 5

approves the PPA and ESA, IIPA suggests the Commission cap recoverable costs at the
levels currently projected.'
Supplemental Application
6. Following execution of the Crimson Orchard PPA and ESA and
contemporaneous to the filing of the Company's request for approval in this proceeding,
throughout the months of February, March, and April of 2025,
_. The First Amendments to the Crimson Orchard PPA and ESA were executed on
August 13, 2025.
IIPA Initial Comments, page 3.
IDAHO POWER COMPANY'S REPLY COMMENTS - 6

7. On August 15, 2025, the Company filed a Supplement to its Application filed
on March 13, 2025. With the Supplemental Application, the Company requested approval
of the First Amendments to the Crimson Orchard PPA and ESA, in addition to the
requested relief in the initial Application.
8. On October 3, 2025, Supplemental Comments were filed by Staff and
Updated Comments were filed by IIPA in response to Idaho Power's Supplemental
Application. In their Supplemental Comments, Staff recommends the Commission: (1)
approve the First Amendment to the PPA and the First Amendment to the ESA, (2)
approve future payments associated with the First Amendments as prudently incurred
expenses for ratemaking purposes but with a
, (3) acknowledge the use of lease accounting for
the First Amendment to the ESA, and (4) exclude the Purchase Options in the First
Amendment to the PPA and the First Amendment to the ESA from the determination of
prudence. In their Updated Comments, the IIPA reiterates the Commission should (1)
deny the Crimson Orchard PPA, (2) deny the Crimson Orchard ESA, and (3) decline to
acknowledge the lease accounting is necessary to facilitate the transaction and that the
resulting expenses associated with both the PPA and ESA as prudently incurred for
ratemaking purposes. IIPA again suggests that in the event the Commission approves
the PPA and ESA, the Commission
s
9. In these Reply Comments, Idaho Power responds to the recommendations
offered by Staff and addresses Staff and IIPA's concerns with the prudency of the
8 IIPA Updated Comments, page 3.
IDAHO POWER COMPANY'S REPLY COMMENTS - 7

Crimson Orchard Project agreements and the proposed measures
resulting from those concerns. Idaho Power selected the Crimson Orchard Project as a
least-cost, least-risk necessary resource resulting from a robust RFP process, which was
overseen by an Independent Evaluator, conducted in compliance with Oregon
competitive bidding rules, as required by this Commission. Idaho Power has relied on the
best available information throughout this procurement process to inform its decision-
making and recommendations in pursuit of its obligation to provide safe, reliable service.
When faced with
The First Amendments were negotiated such that the
that result from the First Amendments.
10. Based upon the best information known and available at the time of
procurement and contracting, as well as the information that is known today, the Crimson
Orchard Project continues to represent the least-cost, least-risk resource to meet an
identified capacity and energy need in 2027 and beyond. The Company respectfully
requests the Commission (1) approve the PPA and the ESA and the First Amendments
to both, acknowledging the resulting expenses are prudently incurred for ratemaking
purposes, (2) acknowledge the lease accounting necessary to facilitate the Crimson
IDAHO POWER COMPANY'S REPLY COMMENTS - 8

Orchard ESA and the First Amendment to the ESA, and (3) reject Staff and IIPA's
unwarranted proposed-
II. REPLY COMMENTS
A. Staff suggests Idaho Power made imprudent decisions based on information
that was not available at the time and on issues that were outside the control
of the Company.
11. Idaho Power has experienced and expects sustained load growth, thereby
requiring the addition of new resources. The electric industry as a whole is experiencing
unprecedented growth, with an estimated rate of new resource additions at four to five
times historical levels. Current projections indicate the Pacific Northwest alone will move
to a resource shortfall beginning in 2026, reaching up to nearly 9 gigawatts ("GW") by
2030, with a forecasted load-growth increase of more than 30 percent by 2034.9 This
same recent resource adequacy study cited challenges faced by utilities for bringing
resources online including "permitting and interconnection delays, cost pressures and
federal rollbacks of clean-energy tax incentives."10 Yet, Staff implies Idaho Power is alone
in the need to acquire resources and the only utility facing challenges bringing resources
online in time to meet identified needs. In their Supplemental Comments, Staff criticizes
several decisions made by Idaho Power, unreasonably suggesting without evidence that
these decisions "contributed to the current situation of last-minute projects with zero
alternatives."11 First, Staff is critical of the timing of the Company's identification of the
first capacity deficiency as part of the 2021 Integrated Resource Plan ("IRP"). Next, Staff
suggests that additional large loads are driving the capacity deficiencies and that Idaho
9 New Study Protects Nearly 9-GW Resource Gap in Pacific Northwest by 2030 1 Supply& Demand
newsdata.com
10 Clearing Up, October 7, 2025, No. 2230.
11 Supplemental Staff Comments, page 5.
IDAHO POWER COMPANY'S REPLY COMMENTS - 9

Power was too optimistic about procuring resources in time to serve these new loads,
particularly in light of the delay in the Boardman to Hemingway ("1321-1") project. Finally,
Staff states the Company limited the types of resources solicited through the 2026 RFP
which is contributing to Idaho Power's resource need in 2027.
i. The identification of the first capacity deficit following a period of
sufficiency was caused by several dynamic and conver_gin_g factors
outside of Idaho Power's control.
12. Although no concerns about the timing of the Company's identification of its
initial capacity deficiency were addressed in their Initial Comments, in their Supplemental
Comments Staff raises a new criticism: suggesting that it was during development of the
2021 IRP "that the Company belatedly recognized that its system was already in a
deficit.1112 The Company first identified a 2023 resource deficiency in the spring of 2021
while refreshing the load and resource balance during development of a Valmy Unit 2 exit
analysis, as directed by the Commission in Order No. 34349.13 During processing of the
case, Idaho Power determined that further review of the 2019 IRP modeling, which was
used to develop the Valmy Unit 2 exit analysis, was required, ultimately resulting in the
filing of the Second Amended 2019 IRP in October 2020. The refreshed modeling and
the resulting load and resource balance, which identified a capacity sufficiency period
through 2028, was extensively reviewed by Staff and intervenors and acknowledged by
the Commission.14
13. Subsequent to the filing of the Second Amended 2019 IRP, in the first
quarter of 2021, Idaho Power began preparing the required Valmy Unit 2 exit analysis
12 Supplemental Staff Comments, page 5.
13 Case No. IPC-E-19-08.
14 Case No. IPC-E-19-19, Order No. 34959.
IDAHO POWER COMPANY'S REPLY COMMENTS - 10

which included an evaluation of system reliability for each July during the 2022 through
2025 time period only. This analysis, which was performed simultaneously with
preparation of the 2021 IRP, identified a net change between the Second Amended 2019
IRP and the updated load and resource balance used for the Valmy Unit 2 exit analysis
of a reduction of approximately 480 MW — 500 MW in available capacity. The refreshed
load and resource balance was further refined through the remainder of the development
of the 2021 IRP. Idaho Power rapidly moved from an expected resource-sufficient position
through 2028,15 to a near-term capacity deficiency starting in 2023.
14. The identification of the capacity deficiency was not the result of an overdue
recognition of a capacity deficit, as suggested by Staff, nor was the 2023 capacity deficit
"established to acquire new resources within [an] acquisition lead time."16 Rather the rapid
change in the resource position was caused by several dynamic and converging factors
outside the Company's control, including third-party transmission capacity constraints,
load growth, and a decline in the peak-serving effectiveness of certain supply-side and
demand-side resources. Market conditions changed dramatically due to ripple effects
from the energy emergency event in California in August 2020, when entities began
reserving transmission capacity across the west, significantly limiting Idaho Power's
access to market hubs. Because available transmission capacity was a key assumption
in the development of the load and resource balance for the Second Amended 2019 IRP,
to reflect the recent market changes, an update to market purchase assumptions used
for the load and resource balance in the 2021 IRP was required.
15 Idaho Power's Second Amended 2019 Integrated Resource Plan, Case No. IPC-E-19-19.
16 Supplemental Staff Comments, page 5.
IDAHO POWER COMPANY'S REPLY COMMENTS - 11

15. Further, because it became more critical to understand the effect variable
energy resources have on system reliability, the Company began using the Loss of Load
Expectation ("LOLE") methodology, which recognizes that the output of variable energy
resources like wind and solar change with time and is a necessary planning tool to ensure
reliability for Idaho Power's system by assessing the loss of load probability of every hour
in the year. The results of the LOLE indicated the ability of Idaho Power's existing demand
response programs to meet peak load was lower than previously assumed. The refined
modeling inputs to the load and resource balance, which identified a capacity deficiency
in 2023, were reviewed as part of the Company's request for acknowledgement of the
2021 IRP,17 with Staff indicating it was "encouraged by the progress the Company had
made in evaluating its own process and the number of improvements implemented,"
including use of the LOLE.18 The Commission acknowledged the 2021 IRP with Order
No. 35603. These dynamic circumstances led the Company to immediately commence a
competitive solicitation for the acquisition of resources to meet the identified 2023
capacity deficiency, issuing the 2021 RFP on June 30, 2021, within months of the capacity
deficiency identification, which ultimately resulted in the filing of Idaho Power's request
for a Certificate of Public Convenience and Necessity to acquire resources to be online
in 2023.19
16. While Staff's assessment that the 2021 RFP, that solicited resources with a
commercial operation date in less than 24 months, "eliminated resource alternatives
requiring longer-lead times" is accurate, the conclusion that there could have been
17 Case No. IPC-E-21-43.
18 Case No. IPC-E-21-43, Order No. 35603, page 3.
19 Case No. IPC-E-22-13.
IDAHO POWER COMPANY'S REPLY COMMENTS - 12

additional alternatives had the deficit been identified earlier is irrelevant.20 It is
unreasonable to suggest Idaho Power could have predicted the modeling assumptions
utilized in the long-term planning models, vetted by Staff and intervenors each IRP
planning period, would abruptly change, ending a decades long capacity sufficiency
period. There was no belated recognition of the capacity deficiency nor was the capacity
deficiency "established to acquire new resources," rather Idaho Power's Second
Amended 2019 IRP identified a capacity sufficiency position through 2028 and within six
months, due to exogenous factors beyond the Company's control, the sufficiency period
immediately ended, and a capacity deficiency identified in 2023.
ii. The Company has an obligation to serve on a non-discriminatory basis
to all those that request it within its service area.
17. Under Idaho law, Idaho Power has an obligation to provide adequate,
efficient, just, and reasonable service on a nondiscriminatory basis to all those that
request it within its service area. It is true that the Company has experienced and expects
sustained load growth. It is also true that to comply with its continuing obligations to serve
customers, Idaho Power must acquire additional resources to meet the identified capacity
deficits on its system when the need arises. Despite the obligation to serve, Staff is critical
of the Company's execution of special contracts with large load customers, suggesting
that Idaho Power should consider "reducing or delaying load growth.1121
18. Yet, within the State of Idaho, the Department of Commerce works to "foster
a business-friendly environment to aid in quality job creation, support existing companies,
strengthen communities, promote innovation and market Idaho domestically and
20 Staff Supplemental Comments, pages 5-6.
21 Staff Initial Comments, page 4.
IDAHO POWER COMPANY'S REPLY COMMENTS - 13

internationally"22 with a vision towards supporting "growth of the state's economy with a
thriving business environment"23 and touting Idaho as a "business-friendly state with low
taxes, limited regulation and efficient infrastructure.1124 Aiming to support the stated
mission of the State of Idaho, but also considering the Company's obligation "to ensure
system reliability at just and reasonable rates for all its customers"25 (as recognized by
Staff), when new large loads initiate a request for service with Idaho Power, the Company
negotiates a unique energy service agreement, or special contract, with those customers.
Within those special contracts, Idaho Power is not incentivized to set an unrealistic
expectation around the availability of service, as doing so would compromise its ability to
reliably serve all customers. In addition to service terms, the Special Contract provides
for a unique pricing structure — that is subject to Commission approval — to ensure the
rates the new large load customer pays are reflective of the impact its load has on the
Company's system.
19. Staff's conclusion that "the Company was too optimistic about when new
resources could be in place to meet these new large loads"26 is unfounded. Idaho Power
identified a 2027 capacity deficiency in the 2021 IRP, subsequently commenced the 2026
RFP process in September 2022, which commenced the extensive bid evaluation
process. The RFP process took nearly 18 months of rigorous evaluation in compliance
with the OPUC competitive bidding process, which Idaho Power is required to follow.
Following a years-long negotiation, the Micron FAB special contract was executed in
22 Idaho Commerce Annual Report 2024.
23 Idaho Department of Commerce Strategic Plan.
24 Idaho Commerce Annual Report 2024.
25 Staff's Supplemental Comments, page 6.
26 Id.
IDAHO POWER COMPANY'S REPLY COMMENTS - 14

November 2024. Throughout those discussions, Idaho Power made Micron aware the
Company was in the process of expanding system capacity and securing new resources
in part to serve the requested load and the contract provisions were based upon those
assumptions. A delay or mitigation of the load ramp of new large customers as Staff
suggests is not necessary. Idaho Power adequately plans for meeting its obligation to
serve all load in its certificated service area as it is required to do and the selection of the
Crimson Orchard Project as a least-cost, least-risk resource is a demonstration of those
efforts.
20. In their criticism of the Crimson Orchard Project being the only viable option,
though no mention is made in their Initial Comments, in Supplemental Comments, Staff
now raises a concern with Idaho Power's execution of special contracts with large load
customers who Staff indicates are causing the capacity deficits in 2026 and 2027. As an
initial point of clarification, Staff mistakenly concludes that deficits in these years are
driven only by new large-load customers.27 Of note, when comparing the forecasted
average 2026 load from the 2021 IRP, the genesis of the 2026 RFP, to the forecasted
average 2026 load from the 2025 IRP, loads are lower than previously forecasted.
Further, while the forecasted average 2027 load for large customers has increased, it did
so for two other customer classes as well and therefore it is incorrect to assert the change
in the 2027 deficit is "primarily being caused by these new large-load customers."28
21. Staff's conclusion also ignores that one of the two new special contracts
expected to be online during 2026 and 2027 has also contracted with Idaho Power to
support its load with incremental resources — that are paid for by that customer— to be
27 Id.
zs Id.
IDAHO POWER COMPANY'S REPLY COMMENTS - 15

online coincident with its load.29 Of note, a 200 MW resource came online in March 2025
and is delivering energy and capacity to Idaho Power's system, a 125 MW resource is
scheduled to come online in advance of summer of 2026, and a 320 MW resource is
scheduled to come online in advance of summer of 2027. Those resources not only offset
a significant portion of the customer's forecasted load, thereby reducing resources that
would otherwise need to be procured, but they provide additional benefits to Idaho Power
and its customers.
iii. The delay in the B2H online date is the result of state and federal apency
delays and obtaining necessary easements.
22. The B2H project, which evolved into a new, single-circuit 500-kilovolt
transmission line approximately 300 miles long, has been identified as a preferred
resource in IRPs since 2009. Notably, the 2017 IRP, 2019 IRP, 2021 IRP, and 2023 IRP
Near-Term Action Plans, including B2H construction related activities mentioned, were
acknowledged by the Commission. As noted by Staff, a project of this size and complexity
does not come without some risks, due to the multiple components of the project, many
of which are dependent upon each other. Permitting alone is subject to review and
approval by, among other government entities, the Bureau of Land Management, United
States Forest Service, United States Navy, and the Oregon Energy Facility Siting Council.
The federal permitting process is dictated primarily by the Federal Land Policy and
Management Act of 1976 and the National Forest Management Act of 1976 and is subject
to the National Environmental Policy Act review.
29 In Order No. 35777, the Commission approved a Special Contract for electric service between the
Company and Brisbie, LLC, which allows for Idaho Power to procure renewable resources for the
purpose of supporting Brisbie's energy needs under a Clean Energy Your Way ("CEYW") structure.
IDAHO POWER COMPANY'S REPLY COMMENTS - 16

23. The 2021 IRP, the genesis for the 2026 RFP, identified an expected B2H
in-service date in 2026, and as recent as the 2023 IRP, the Company expected
construction of B2H to begin in 2023, with the line in service in 2026. It was not until late
2023 that, due to delays in obtaining Notices to Proceed from state and federal agencies
well beyond Idaho Power's control, as well as additional time being spent to negotiate the
Guaranteed Maximum Price amendment for the construction phase of the project, diligent
efforts by the Company to reduce project costs and risk, that the anticipated in-service
date of B2H moved to November 2026. As a result of continued state and federal agency
delays and obtaining right-of-way easements among other items, construction did not
commence until 2025, resulting in a latest estimated in-service date for B2H no earlier
than late 2027.
24. Staff's criticism of Idaho Power's commitment to serve new large loads
because of the risks associated with a B2H in-service date of 202630 is unreasonable. All
projects come with schedule risk, especially resource additions where construction alone
spans multiple years following a multi-year, or in the case of B2H, decades long,
permitting process, and particularly during a period of supply chain disruptions and
delays, "volatile tariffs, and permitting delays" as recognized by Staff.31 This is evidenced
by Idaho Power's recent request to withdraw Certificate Number 559 and the PPA
associated with the Jackalope Wind Project due to permitting delays and uncertainty
around federal land use policies the developer was facing. Locally, a developer was
denied a Conditional Use Permit by Ada County, Idaho for their Powers Butte Energy
Center, a 2026 resource that had been identified as a least-cost, least-risk resource
30 Id., page 7.
31 Id.
IDAHO POWER COMPANY'S REPLY COMMENTS - 17

through the Company's competitive solicitation process. Finally, the online date for Idaho
Power's Black Mesa Battery Energy Storage System ("BESS")was delayed due to supply
chain issues. Idaho Power is diligent in its efforts to ensure resources are able to meet
planned commercial operation dates, as noted by Staff's acknowledgement that the
actions taken by Idaho Power to include commercial operation date guarantee provisions
in the Crimson Orchard PPA and ESA "are reasonable protection against the risk of
schedule delay" and therefore considered to be "reasonable".32 Staff's disparagement of
Idaho Power because of a delay in the B2H in-service date is superfluous.
iv. Idaho Power did not limit the types of resources eligible to bid into the
2026 RFP.
25. While the concern was not raised in Staff's Initial Comments, in their
Supplemental Comments and as erroneously concluded in a separate case,33 Staff states
that the Company's "setbacks in procuring carbon-clean resources" may have been
avoided if Idaho Power "had properly solicited for all resource types, more [natural gas]
proposals may have been submitted.1134 Staff's assertion that the Company "de-
emphasize[d]"35 natural gas resources in its 2026 RFP solicitation is factually incorrect.
As discussed in Mr. Hackett's Direct Testimony, the 2026 RFP process did not restrict
bids based on resource type or ownership structure. That is, the 2026 RFP allowed bids
for all commercially viable resource types that could meet the specified commercial
operation dates. Staff seems to misunderstand the condition that gas-fired resources be
convertible to hydrogen as a restriction on bids — that is simply not true. The condition
32 Staff Initial Comments, page 4.
33 Case No. IPC-E-24-46.
34 Staff Supplemental Comments, page 8.
35 Id.
IDAHO POWER COMPANY'S REPLY COMMENTS - 18

that gas-fired resources be convertible to hydrogen is simply a design specification that
would allow for a change in the fuel source in the future and therefore did not restrict bids,
which was also supported by an Environmental Protection Agency law in effect at the time
that contemplated that gas plants would need to convert to hydrogen in the future. Finally,
it should be noted that it is industry practice to build turbines to be convertible to hydrogen
and such a design specification would not deter developers from bidding into the RFP.
26. Based on the experience of Idaho Power's Internal Bid Team, the process
to permit and construct a gas plant in Idaho is likely to take several years. As Staff noted,
one gas project was bid into Idaho Power's 2026 RFP, however during evaluation of the
resource bids, it was determined the project was infeasible due to interconnection issues
and the necessary procurement of long lead items and therefore the project was removed
from further evaluation. That same project was the only gas project bid into Idaho Power's
subsequent 2028 RFP to meet 2028 resource needs, but the developer has further
indicated that the commercial operation date of April 1, 2028, is no longer viable. With a
now accelerated commercial operation date of June 1, 2028, the Bennett Mountain Gas
Expansion project, selected as the least-cost, least-risk resource of the beyond April 2028
bids evaluated through the 2028 RFP, for which the Company's request for a CPCN is
pending, appears to be the earliest a gas resource could be permitted, constructed, and
placed in-service. Though Staff's conclusion that natural gas resources are not currently
subject to the same tax credit, tariffs, and federal permitting volatility is mostly accurate,
the assumption that natural gas resource bids "would still be viable"36 in 2027 is
unsubstantiated.
36 Id.
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B. The selection of the Crimson Orchard Project as a least-cost, least-risk 2027
resource was prudent based on the information known at the time and
remains prudent based on information known today.
27. The goal of the IRP is to ensure the Company's system has sufficient
resources to reliably serve customer demand and flexible capacity needs over a 20-year
planning period. This prudent, long-range planning process performed for the 2021 IRP,
was the basis for the extensive rule-compliant RFP process undertaken by Idaho Power.
Though Staff declined to participate in any portion of the 15-month process, the robust
2026 RFP process included oversight by an independent evaluator, stakeholders, and
the OPUC, and yielded the identification of the least-cost, least-risk resources necessary
to meeting Idaho Power's identified capacity deficiencies. The Company appreciates
Staff's acknowledgment that the Crimson Orchard resource is a least-cost, least-risk
solution in both their Initial Comments and Supplemental Comments.37
i. The execution of the First Amendments to the Crimson Orchard PPA
and ESA was a prudent decision.
28. Subsequent to the execution of the Crimson Orchard PPA and ESA,_
As a result, Idaho Power entered into the First Amendment to the PPA and the First
Amendment to the ESA which include negotiated and carefully structured --related
provisions, including
37 Staff Initial Comments, page 2 and Staff Supplemental Comments, page 2.
IDAHO POWER COMPANY'S REPLY COMMENTS - 20

, is a limited and reasonable approach, with by both
parties, that helps ensure the Crimson Orchard Project continues to remain a viable
resource addition.
29. Although Staff recommends approval of the Crimson Orchard PPA and ESA
and the First Amendments to each, acknowledging the project is a least-cost, least-risk
resource addition, Staff believes the Company should bear the
associated with the First Amendments and proposes `
1138 Idaho Power strongly opposes
Staff's recommendation that any_ risks associated with the First Amendments be
borne by the Company, especially when the Project remains the least-cost, least-risk
option.
30. As emphasized in Order No. 35643, Idaho Power is responsible for planning
and managing its load and resource portfolio and the Commission expects "the Company
to closely monitor its projected capacity needs going forward and to act proactively to
ensure a robust RFP process can be completed.1139 Upon the first identification of the 2027
capacity need, in September 2022, Idaho Power commenced the fair and competitive
bidding process for procurement of resources, ultimately leading to the final shortlist of
cost-effective 2027 resource additions. Subsequently, the Company executed a PPA and
ESA associated with one of those least-cost, least-risk resources, the Crimson Orchard
Project. Staff agrees that the 2027 capacity need, first presented in the acknowledged
38 Staff Supplemental Comments, page 2.
39 Page 13.
IDAHO POWER COMPANY'S REPLY COMMENTS - 21

2021 IRP and again in this proceeding, exists40 and a competitive solicitation process
occurred.41
31. When faced with the
Idaho
Power prudently executed the First Amendment to the PPA and the First Amendment to
the ESA. The First Amendments were negotiated such that the
that result from the First
Amendments. It is inappropriate to shift the_risk to Idaho Power by
-related provisions of the First
Amendments that were outside of the Company's control.
ii. Had Staff expanded their cost-effectiveness evaluation, there would be
no basis for their criticism of the Company's decisions in resource
selection or pursuit of the First Amendments under review in this case.
32. While Staff concedes the Crimson Orchard Project is a cost-effective
resource addition, Staff is critical of "having to declare a project to be [least-cost, least-
risk] because it is the only viable project.1142 Staff's criticism is unfounded and the result of
40 Staff Initial Comments, page 2.
41 Id., page 3.
42 Staff Supplemental Comments, page 5.
IDAHO POWER COMPANY'S REPLY COMMENTS - 22

an incomplete evaluation. In their Initial Comments, Staff agreed with the Company's
determination of the final shortlist of 2026 RFP projects, indicating they "were properly
vetted by the Company, with oversight by an independent evaluator and review by the
OPUC staff." After having "reviewed each step of the selection process, the cost
assumptions for various bids, and the portfolio net present value results" Staff concluded
"that the projects that made it to the [final shortlist] are the most cost-effective proposals
from the 2026-2027 RFP, including the Crimson Orchard projects.,,43 The inability of all
other 2026 RFP bids, projects from both the initial shortlist and final shortlist, to meet a
June 1, 2027, commercial operation date is a moot point; the Crimson Orchard Project
was identified as a cost-effective resource through an extensive bid evaluation process
and remains a least-cost, least-risk resource addition today.
33. Staff indicates they would "normally re-evaluate Crimson Orchard by
comparing it to the nearest-priced competitive bids" from the 2026 RFP but did not do so
because "there are no viable competitor projects.1144 Staff, however, failed to consider the
Company does have bid pricing that could have been used to evaluate the cost-
effectiveness of the Crimson Orchard Project — the Ievelized cost associated with the
projects bid into the 2028 RFP. Though the bids are for projects with a commercial
operation date beyond April 2028, the bid pricing was received prior to recission of
investment tax credits and does not reflect costs associated with the potential impacts of
tariffs, the Ievelized cost would be comparable to the Crimson Orchard Project contract
prices reflected in Table No. 1 of Staff's Supplemental Comments, or $-/megawatt-
43 Staff Initial Comments, page 3.
44 Staff Supplemental Comments, page 5.
IDAHO POWER COMPANY'S REPLY COMMENTS - 23

hour ("MWh") for the PPA and =-kilowatt ("kW")/month for the ESA.45 With solar
PPA pricing ranging from M/MWh - M/MWh and ESA pricing ranging from
W-kW/month - M-kW/month for the bids received in the 2028 RFP, it is
reasonable to conclude that when compared to other viable projects, Crimson Orchard
Project remains a least-cost, least-risk resource. Unfortunately, Staff elected not to
complete this analysis.
34. Additionally, it is realistic to assume that Idaho Power would negotiate an
equivalent
for the beyond April 2028 bids. The Company is unable
to procure generation resources without comparable provisions as evidenced by the
Blacks Creek Energy Center PPA, executed subsequent to the First Amendments to the
Crimson Orchard PPA and ESA, currently pending approval with the Commission, which
includes similar--related provisions and a .46 Because a
, the of the Crimson Orchard Project would be
comparable to the of similar beyond April 2028 bids. Had Staff expanded
their cost-effectiveness evaluation, there would have been no basis to be critical of the
Company for having to declare the Crimson Orchard Project as least-cost, least-risk
because it was the only viable project with the ability to meet the 2027 commercial
operation date.
45 Id., page 4.
46 Case No. IPC-E-25-27.
IDAHO POWER COMPANY'S REPLY COMMENTS - 24

C. The Commission should adopt Staff's recommendation to approve the
Crimson Orchard PPA, the Crimson Orchard ESA and the First Amendments
to both.
35. Idaho Power appreciates Staff's review of the Company's Initial Application
and support for approval of the Crimson Orchard PPA and ESA but believes Staff's review
of the Supplemental Application was deficient and Staff's recommendation that Idaho
Power bear the associated with the First Amendments is based on
unsupported conclusions. Staff issued 27 discovery requests and performed a detailed
and comprehensive review of the Company's 2026 RFP process—including both the
need identified therein and the process through which the Company solicited resource
bids—the underlying analysis of the final bids that led to selection of the Crimson Orchard
Project. Likewise, Idaho Power appreciates Staff's thorough review of contract terms and
provisions within the PPA, ESA and the First Amendments to both, and accepts Staff's
proposal to exclude the Purchase Options from the determination of prudence. The
Commission should (1) accept Staff's recommendations to approve the PPA and the ESA
and the First Amendments to both, acknowledging the resulting expenses are prudently
incurred for ratemaking purposes with the exception of the Purchase Option provisions,
(2) acknowledge the lease accounting necessary to facilitate the Crimson Orchard ESA
and the First Amendment to the ESA, but (3) reject Staff's proposed— associated
with the Crimson Orchard Project agreements.
D. Idaho Power's Clarification of the Crimson Orchard Project's Characteristics
that Led to Identification as a Least-Cost, Least-Risk Resource Addition.
36. In their Updated Comments, IIPA expresses criticism of the Crimson
Orchard Project contract provisions and the associated modeling assumptions utilized by
the Company, drawing a number of conclusions regarding the Crimson Orchard Project
IDAHO POWER COMPANY'S REPLY COMMENTS - 25

that are incorrect. IIPA appears to have an overall misunderstanding of the ESA and the
provisions within. For clarification, the Crimson Orchard ESA is an agreement associated
with a third-party owned energy storage facility, which provides for the supply by Crimson
Orchard Solar LLC of 100 MW of capacity to Idaho Power's system. As a result, the
provisions of the ESA are specific to the capacity provided by Crimson Orchard Solar LLC
and the financial consequences imposed on the project owner if they fail to do so. In
response to IIPA's concerns, the Company addresses and provides clarification on the
following: (1) the provisions of the Crimson Orchard ESA, and (2) the modeling of the
Crimson Orchard Project characteristics and associated costs.
L The Crimson Orchard ESA includes reasonable and appropriate
provisions that ensure timely commercial operation and adequate
output.
37. IIPA expresses concern regarding the lack of performance guarantee
provisions in the ESA, concluding that the "structure of the contract exposes ratepayers
to significant financial risk without providing sufficient assurance that the project will
deliver the promised capacity and energy.1147 Yet, in Section 5.2 of the ESA, the
Availability Guarantee provision declares that the project must achieve Guaranteed
Availability during each Contract Year in accordance with Annex C to the agreement,
which further details the Guaranteed Availability periods as well as associated liquidated
damages of the Guaranteed Availability is not met. The performance guarantee
provisions of the Crimson Orchard ESA are reasonable and compensate the Company
adequately should the guarantees not be met.
47 IIPA Updated Comments, page 5.
IDAHO POWER COMPANY'S REPLY COMMENTS - 26

38. Next, contrary to IIPA's assertion, the Crimson Orchard ESA does impose
financial penalties should the project not achieve its full nameplate capacity by its
commercial operation date.48 Section 3.4 of the ESA details the Delay Damages imposed
if the project has not reached its Guaranteed Commercial Operation Date of April 1, 2027.
Finally, while IIPA is correct that the ESA's fixed monthly capacity payments "are not
adjusted based on actual performance,1149 the Availability Guarantees ensure Idaho
Power is fairly compensated for the failure of the energy storage facility to perform at
agreed upon levels. IIPA's conclusion that the provisions of the Crimson Orchard ESA
expose customers to unnecessary risks50 is unsubstantiated. The terms of the ESA,
including pricing, security, and other terms of service, are generally consistent with
industry standard terms included in other Commission-approved procurements and
energy sales agreements.
ii. Idaho Power appropriately modeled the Crimson Orchard Proiect
characteristics.
39. In their Updated Comments, IIPA expresses concern with the modeling of
the costs associated with the ESA, indicating the Company should have included an
escalation rate over the 20-year term of the ESA. This assumption is not "unrealistic and
misleading in that it fails to account for the long-term financial risk associated with the
rising costs over the life of the project."51 In fact, Idaho Power modeled the costs
associated with the ESA consistent with the contract provisions, with fixed, monthly
capacity pricing, with no annual escalation, throughout the term of the agreement. While
48 Id., page 6.
4s Id.
50 Id.
51 Id., page 7.
IDAHO POWER COMPANY'S REPLY COMMENTS - 27

the Crimson Orchard ESA is treated as a capital lease for accounting purposes, it is not
a utility-owned asset. As a third-party owned system, the Company is not responsible for
additional project costs incurred over the life of the energy storage facility. I IPA's assertion
reflects a gross misunderstanding of the energy storage facility ownership and associated
ESA contract structure. The Crimson Orchard ESA levelized cost was accurately
calculated and appropriately modeled alongside all 2026 RFP bids.
40. IIPA expresses concern over financing cost assumptions utilized by Idaho
Power for modeling of the Crimson Orchard Project as part of the evaluation of the 2026
RFP bids. For clarification, the incremental borrowing rate for which IIPA assumes Idaho
Power has understated its financing costs,52 is only utilized for evaluating energy storage
agreement proposals. Under Generally Accepted Accounting Principles, following
establishment of the lease liability, interest expense is calculated by applying the
incremental borrowing rate to the remaining lease liability. The weighted average cost of
capital ("WACC") referenced by IIPA is contained within the list of assumptions in the
pricing model as it is the discount rate which is used to calculate the present value of the
revenue requirement and the Ievelized annual payment associated with all resource bids.
Therefore, the computation of the Ievelized cost of the ESA utilized the WACC.
41. In addition, IIPA asserts that "[i]t is widely recognized that high ambient
temperatures can limit a battery's ability to charge or discharge at full capacity in order to
protect system components" rendering the BESS unavailable for dispatch during the hot
summer temperatures and that the Company failed to account for the limitations in its
modeling assumptions.53 IIPA however, is not recognizing the design of the BESS that
52 Id., page 10.
53 Id., page 14.
IDAHO POWER COMPANY'S REPLY COMMENTS - 28

includes a fully functioning heating, ventilation, and air conditioning system within each of
the containment vessels. The BESS can operate in a wide range of temperatures and
therefore no modeling adjustment of BESS projects specific to the operating hours due
to high temperatures is required.
42. When discussing Idaho Power's modeling of the wildfire risk factors in the
Company's Reliability and Capacity Assessment Tool ("RCAT"), IIPA misrepresents a
number of the assumptions utilized. For clarification, the wildfire risk modeled by Idaho
Power aims to represent the loss of transmission path used to import energy and is not
intended to capture the impact that the wildfire has in the internal transmission system
and generating resources within the Company's balancing authority. First, IIPA misleads
that only 31 days of each summer is modeled when in fact, the entire summer period of
June 15 through September 15 is considered. In addition, when modeling wildfire risk to
transmission, the Equivalent Forced Outage Rate during Demand ("EFORd") of the
transmission path is not adjusted rather the modeling assumption includes a negative
capacity amount to reflect the impact of the decrease in the Total Transfer Capability and
the stranded generation potential. Thus, IIPA's conclusion that "if you force more wildfire
days into the model, the model predicts fewer future outage days" is false. Idaho Power
appropriately considered and modeled a wildfire risk factor in the RCAT and therefore
there is no increased risk to customers.
43. In their Updated Comments, IIPA expresses concern with the financial risk
associated with imputed debt that arises from a PPA, noting that long-term PPAs are
treated as debt like obligations by credit rating agencies.54 Idaho Power does not
54 Id., page 19.
IDAHO POWER COMPANY'S REPLY COMMENTS - 29

disagree. However, in their approval of the 2026 RFP, the OPUC directed the Company
to exclude any provision applying the cost of imputed debt to the price scores of any
bids.55 Because Idaho Power must follow the OPUC competitive bidding process, the
Company subsequently excluded any imputed debt costs from the bid evaluation process.
III. CONCLUSION
44. Idaho Power acknowledges and appreciates IIPA and Staff's review of the
Company's application and respectfully requests the Commission accept (1) Staff's
recommendations to approve the Crimson Orchard PPA and the Crimson Orchard ESA
and the First Amendments to both, acknowledging the resulting expenses are prudently
incurred for ratemaking purposes with the exception of the Purchase Option provisions,
(2) acknowledge the lease accounting necessary to facilitate the Crimson Orchard ESA
and the First Amendment to the ESA, but (3) rejecting Staff and IIPA's proposed .
=associated with the Crimson Orchard Project agreements, as the Crimson Orchard
Project remains a prudent and least-cost, least-risk project required to help meet the
identified capacity deficit in 2027.
DATED at Boise, Idaho this 17th day of October 2025.
DONOVAN E. WALKER
Attorney for Idaho Power Company
55 Docket UM 2255, Order No. 23-260.
IDAHO POWER COMPANY'S REPLY COMMENTS - 30

CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on the 17th day of October, 2025, 1 served a true and
correct copy of Idaho Power Company's Reply Comments upon the following named
parties by the method indicated below, and addressed to the following:
Commission Staff Hand Delivered
Erika K. Melanson 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 Erika.Melanson(a)_puc.idaho.gov
PO Box 83720
Boise, ID 83720-0074
Micron Technology, Inc. Hand Delivered
Austin Rueschhoff U.S. Mail
Thorvald A. Nelson Overnight Mail
Austin W. Jensen FAX
Kristine A.K. Roach X Email darueschhoff(d_)hol land hart.com
Holland & Hart LLP tnelson hollandhart.com
555 17th Street, Suite 3200 awlensen(a)_hol land hart.com
Denver, CO 80202 aclee _hollandhart.com
karoach hol land hart.com
Idaho Irrigation Pumpers Association, Inc. Hand Delivered
Eric L. Olsen U.S. Mail
ECHO HAWK & OLSEN, PLLC Overnight Mail
505 Pershing Avenue, Suite 100 FAX
P.O. Box 6119 X EMAIL elo(a)_echohawk.com
Pocatello, ID 83205
Lance Kaufman, Ph.D. Hand Delivered
2623 NW Bluebell Place U.S. Mail
Corvallis, OR 97330 Overnight Mail
FAX
X EMAIL lance _aegisinsight.com
Stacy Gust
Regulatory Administrative Assistant
IDAHO POWER COMPANY'S REPLY COMMENTS - 31