20260624Final_Order_No_37073.pdf

Office of the Secretary
Service Date
June 24,2026
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF AVISTA ) CASE NO.AVU-E-26-03
CORPORATION AND FORD HYDRO )
LIMITED PARTNERSHIP'S JOINT )
PETITION FOR APPROVAL OF POWER ) ORDER NO. 37073
PURCHASE AGREEMENT )
On March 30,2026,Avista Corporation("Company")and Ford Hydro Limited Partnership
("Ford Hydro") (collectively the "Parties") applied to the Idaho Public Utilities Commission
("Commission")requesting an order approving a Power Purchase Agreement("PPA")between the
Parties ("Application").Application at 3. The PPA will replace a prior power purchase agreement
("Prior Agreement")between the Parties that is set to expire on June 30, 2026.Id. If approved,the
PPA will commence on July 1, 2026, and will expire on June 30, 2029. Id.
On April 20,2026,the Commission issued a Notice of Application and Notice of Modified
Procedure,establishing comment deadlines. Order No. 37009.No petitions to intervene were filed.
Staff filed comments to which the Company replied. No other comments were received.
Based on our review of the record, we issue this Final Order approving the PPA on the
condition that the Parties update the PPA with certain modifications.
THE APPLICATION
The Parties represented that the PPA would replace the Prior Agreement (and related
Amendment No. 1) approved in Order Nos. 36282 and 36310. Application at 3. The Parties
represented the PPA was substantially similar to the Prior Agreement but was updated to include:
(1) a three-year term; and (2) the terms detailed in Amendment No. 1 to the Prior Agreement. Id.
at 4. The Parties requested an order approving the PPA on or before July 1, 2026. Id.
STAFF COMMENTS
Staff recommended the Commission approve the PPA on the condition that the Parties
update the PPA with the following modifications:
1. In section 6.1 of the PPA, replacing "Effective Date"with"March 27, 2026;"
2. Updating the statement in PPA Exhibit E to reflect the avoided cost rates locked in
based on the legally enforceable obligation("LEO") date;
3. Adopting a timeframe that provides monthly estimates at least five days before the
delivery month in Section 5.2 of the PPA; and
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4. Adopting the market prices without the impacts of Washington's Climate Commitment
Act("CCA").
Staff Comments at 2. Staff also recommended the Commission declare that the payments made by
the Company to Ford Hydro for purchases of the electric energy generated by Ford Hydro's
hydroelectric facility are prudently incurred expenses for the purpose of ratemaking.Id. at 1-2.
Staff believed the applicable avoided cost rate needed to be based on the date when a LEO
was established. Id. at 2. Because the PPA was executed on March 27, 2026, Staff believed that
was the date a LEO was established. Id. Staff believed the original wording of the PPA's Exhibit
E created confusion and recommended the Parties update Exhibit E to clarify that the avoided cost
rates are based on when a LEO was established(e.g., March 27, 2026).Id. at 3. Staff believed the
timeframes for providing monthly estimates were not reasonable nor compatible with other
timeframes set forth in the PPA. Id. at 3-4. Thus, Staff recommended the Parties update Section
5.2 of the PPA to require "monthly estimates at least five days before the delivery month."Id. at
4. Staff highlighted that in Order No. 36015 the Commission determined that CCA costs should
not be paid by Idaho ratepayers and thus recommended the Parties update the PPA with market
prices that do not include CCA impacts. Staff Comments at 5.
COMPANY REPLY
The Company agreed with Staff s recommendations one through three. Company Reply
Comments at 1. However, the Company disagreed with Staff s fourth recommendation that the
Parties should update the PPA with market prices that do not include CCA impacts. Id. at 1. The
Company believed the PPA unlikely to make Idaho customers"incur incremental costs attributable
to CCA impacts." Id. at 1-2. The Company believed Staff s fourth recommendation should be
addressed in a future general rate case.Id. at 2.
COMMISSION FINDINGS AND DECISION
The Commission has jurisdiction over the Application,the PPA, and the issues in this case
under Title 61 of the Idaho Code including, Idaho Code §§ 61-501, -502, and -503. The
Commission is empowered to investigate rates, charges,rules,regulations,practices, and contracts
of all public utilities and to determine whether they are just, reasonable, preferential,
discriminatory, or in violation of any provisions of law, and to fix the same by order.Idaho Code
§§ 61-501, -502, and -503. In addition, the Commission has authority under the Public Utility
Regulatory Policies Act of 1978 ("PURPA") and Federal Energy Regulatory Commission
("FERC") regulations to set avoided costs, to order electric utilities to enter into fixed-term
ORDER NO. 37073 2

obligations for the purchase of energy from QFs, and to implement FER rules. The Commission
may enter any final order consistent with its authority under PURPA.
The Commission has reviewed the record in this case. Based on our review,we find it fair,
just,and reasonable to approve the PPA on the condition that the PPA is updated with the following
modifications:
1. In section 6.1 of the PPA, replacing "Effective Date"with"March 27, 2026;"
2. Updating the statement in PPA Exhibit E to reflect the avoided cost rates locked in
based on the LEO date;
3. Adopting a timeframe that provides monthly estimates at least five days before the
delivery month in Section 5.2 of the PPA; and
4. Adopting the market prices without the impacts of Washington's CCA.
We also find it fair,just, and reasonable to declare that the payments made by the Company to
Ford Hydro for purchases of the electric energy generated by Ford Hydro's hydroelectric facility
are prudently incurred expenses for the purpose of ratemaking.
With respect to the modification on market prices,we remain persuaded that"it is not fair,
just, or reasonable to include the costs associated with CCA compliance in Idaho rates."Order No.
36015 at 6 (citing Idaho Code §§ 61-301, 61-502). Because the market price used in the PPA
includes the impacts of Washington's CCA, and that may increase the costs associated with the
PPA, which could directly affect Idaho ratepayers, we find it reasonable to require the Parties to
update the PPA by adopting market prices without the impacts of Washington's CCA. Further,
because the Commission has already determined that Idaho ratepayers will not pay costs associated
with Washington's CCA (see Order No. 36015), we do not find that our decision in this case will
set a new precedent for future agreements or decisions.
ORDER
IT IS HEREBY ORDERED that the PPA is approved, effective July 1, 2026,provided the
Parties update the PPA with the modifications described above.
IT IS FURTHER ORDERED that the Parties shall file an updated PPA as a compliance
filing within 14 days of this Order.
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within 21 days of the service date of this Order regarding any matter decided in
this Order.Within seven days after any person has petitioned for reconsideration, any other person
may cross-petition for reconsideration.Idaho Code § 61-626.
ORDER NO. 37073 3

DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 24th day of
June 2026.
G
EDWARD LODGE, PR_ IDENT
J 7
R. HAMMOND JR., COMMISSIONER
DAYN HA IE, COMMISSIONER
ATTEST:
Monica I3afri Sanchez
Commission Secretary
L\Legal\ELECTRIC\A W-E-26-03_PPA\orders\AV UE2603_FO_kr.docx
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