Application.tif

CERTIFICATE OF ATTORNEY
ASSERTION THAT INFORMATION CONTAINED IN AN IDAHO PUBLIC UTILITIES
COMMISSION FILING IS PROTECTED FROM PUBLIC INSPECTION
CASE NO. IPC-E-26-20
Application for Approval of a Power Purchase Agreement and an Energy Storage
System Tolling Agreement with Bluebird Solar Project LLC
The undersigned attorney, in accordance with Commission Rules of Procedure 67,
believes that the Direct Testimony of Eric Hackett, the Direct Testimony Jared Ellsworth,
and Exhibit Nos. 2, 3, 4, and 5 to the Direct Testimony of Eric Hackett dated June 19,
2026, contain information that Idaho Power Company and a third party claim are trade
secrets, business records of a private enterprise require by law to be submitted to or
inspected by a public agency, and/or public records exempt from disclosure by state or
federal law (material nonpublic information under U.S. Securities and Exchange
Commission Regulation FD)as described in Idaho Code § 74-101, et seq., and/or § 48-
801, et seq. As such, it is protected from public disclosure and exempt from public
inspection, examination, or copying.
DATED this 19th day of June 2026.
Donovan E. Walker
Attorney for Idaho Power Company
APPLICATION FOR APPROVAL OF A PPA AND TOLLING AGREEMENT - 1
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]
[e-mail]
Attorney for Idaho Power Company
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF IDAHO POWER
COMPANY’S APPLICATION FOR
APPROVAL OF A POWER PURCHASE
AGREEMENT AND AN ENERGY STORAGE
SYSTEM TOLLING AGREEMENT WITH
BLUEBIRD SOLAR PROJECT LLC.
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CASE NO. IPC-E-26-20
APPLICATION
Idaho Power Company (“Idaho Power” or “Company”), in accordance with Idaho
Code §§ 61-501, 61-502, and 61-503 as well as Rules of Procedure (“RP”) 52 and 201
hereby respectfully makes application to the Idaho Public Utilities Commission
(“Commission”) for an order: (1) approving the 20-year Power Purchase Agreement
(“PPA”) between Bluebird Solar Project LLC and Idaho Power Company supplying 200
megawatts (“MW”) of output from the solar powered generation facility to the Company
(“Bluebird PPA”), (2) approving the 20-year Energy Storage System Tolling Agreement
between Bluebird Solar Project LLC and Idaho Power Company for 100 MW of
APPLICATION FOR APPROVAL OF A PPA AND TOLLING AGREEMENT - 2
dispatchable energy storage capacity (“Bluebird Tolling Agreement”), and (3)
acknowledging the lease accounting necessary to facilitate the transaction and that the
resulting expenses associated with both the PPA and the Bluebird Tolling Agreement are
prudently incurred for ratemaking purposes. Approval of both the Bluebird PPA and the
Bluebird Tolling Agreement, collectively, referred to as the “Bluebird Project,” is necessary
to position the Company to meet its obligation to provide safe, reliable service to its
customers.
Accompanying this Application are two sets of testimony. The Direct Testimony of
Jared L. Ellsworth presents the Company’s need for new resources to reduce an identified
capacity deficit in 2028 as informed by the 2023 Integrated Resource Plan (“IRP”), and
subsequently further enhanced through system reliability evaluations, which led to the
solicitation through a Request for Proposals (“RFP”) seeking to acquire energy and
capacity necessary to address the identified near-term capacity needs. Mr. Ellsworth then
describes the most recent assessment of system reliability and its impact to the capacity
deficit, supporting the acquisition of resources to address the identified near-term capacity
needs. The Direct Testimony of Eric Hackett provides an overview of the procurement
process undertaken to reduce Idaho Power’s identified capacity deficiency in 2028, and
the resulting fair and competitive RFP process that was fully compliant with the required
resource procurement rules, leading to the selection of least-cost, least-risk resources
necessary to reduce the Company’s electric energy needs in 2028, including the Bluebird
PPA and the Bluebird Tolling Agreement for which Idaho Power is requesting approval of
in this proceeding.
APPLICATION FOR APPROVAL OF A PPA AND TOLLING AGREEMENT - 3
I. BACKGROUND
1.The Company’s annual capacity positions developed to inform the 2023 IRP
identified deficits of 138 MW of incremental capacity needs in 2028 and 555 MW of
supply-side resource additions in the Preferred Portfolio in 2028. Further, the 2023 IRP
identified incremental capacity needs of 142 MW in 2029 and growing to over 1,150 MW
by 2038. As described more completely in the Direct Testimony of Mr. Ellsworth, the
Company recognizes that during the near-term resource decision-making phase, the
annual capacity positions can be very fluid and therefore regularly performs system
reliability assessments. Idaho Power continuously 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
the Company’s consecutive requests to acquire resources to be online in 2023, 2024,
2025, 2026,2027, 2028, 2029 and 2030.1 Idaho Power expects to acquire additional
resources each year through 2028 and beyond. See, Oregon Public Utility Commission
of Oregon (“OPUC”) Case No. UM 2317, In the Matter of Idaho Power Company’s
Application for Approval of 2028 All-Source Request for Proposals to Meet 2028 Capacity
Resource Need.
2.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. Idaho Power has experienced and expects sustained
load growth, thereby requiring the addition of new resources. As a result, in order to meet
its obligation to reliably serve customer load in a least-cost, least-risk manner, Idaho
1 Case Nos. IPC-E-22-06, IPC-E-22-13, IPC-E-22-29, IPC-E-23-05, IPC-E-23-20, IPC-E-24-12, IPC-E-24-
16, IPC-E-24-42, IPC-E-24-45, IPC-E-24-46, IPC-E-25-10, IPC-E-25-27, IPC-E-25-29, and IPC-E-26-04.
APPLICATION FOR APPROVAL OF A PPA AND TOLLING AGREEMENT - 4
Power began a competitive solicitation for the acquisition of resources. The Company
conducted a competitive solicitation through the issuance of an All-Source RFP seeking
to acquire a combination of energy and capacity resources. Idaho Power did not define
the type of resource (i.e., wind, solar, gas, or battery storage) desired rather the RFP
targeted resource procurements consistent with the incremental capacity deficiencies in
the 2023 IRP, accepting bids for energy or capacity incremental to its system beginning
in the summer 2028 timeframe and beyond, from market energy purchases or new or
existing resources. The procurement process resulted in the identification of least-cost,
least-risk resources necessary to fill the identified capacity deficiency of 204 MW. The
proposed acquisitions, as described herein, are necessary and required in order to
continue to provide reliable and adequate electric service to Idaho Power’s customers
beginning in 2028 and into the future.
II. OREGON PROCUREMENT RULES
3. The Commission, in Case No. IPC-E-10-03, initiated a case seeking to
establish competitive bidding guidelines for the RFP process. In 2013, the Commission
closed Case No. IPC-E-10-03 without establishing Idaho-specific resource procurement
guidelines, but rather directing Idaho Power to follow the RFP guidelines applicable to its
Oregon service territory. The Oregon RFP guidelines to which the Commission referred
were later codified into the administrative rules of the OPUC resource procurement rules.
The OPUC resource procurement rules impose competitive bidding requirements upon
an electric utility for the “acquisition of a resource or a contract for more than an aggregate
of 80 MWs and five years in length,” among other requirements.
APPLICATION FOR APPROVAL OF A PPA AND TOLLING AGREEMENT - 5
4.Idaho Power initiated the rule compliant RFP process on February 29, 2024,
to acquire resources to be online in 2028 and beyond. Following feedback from
stakeholders, the Company updated the 2028 RFP to consider bids with later commercial
operation dates, bifurcating the evaluation of the bids, with prioritization of bids with a
commercial operation date by April 1, 2028, (“2028 Bids”) followed by bids that could not
meet the April 1, 2028, commercial operation date (“Beyond April 2028 Bids”). Idaho
Power’s discussion in this case is specific to the evaluation of the Beyond April 2028 Bids
for which the Company ultimately received approval of the final shortlist of bids with a
commercial operation date no later than June 1, 2029 (“2029 Bids”) to meet the identified
capacity deficits. The OPUC found that Idaho Power conducted a fair and competitive
resource acquisition procurement process in accordance with the OPUC competitive
bidding rules. OPUC Order No. 25-327, Docket UM 2317, Aug. 30, 2025. The Company
used the results from that approved final shortlist, selecting the second most cost-
effective project2 identified through the extensive competitive bidding process, the
Bluebird Project, to help reduce the 2028 capacity deficiency, and for which Idaho Power
is requesting the Commission approve the PPA and Tolling Agreement in this proceeding.
III. RESOURCE PROCUREMENT PROCESS
5. On February 29, 2024, Idaho Power commenced the competitive bidding
process, filing a request with the OPUC to (1) approve the selection of London Economics
International LLC (“LEI”) as the Independent Evaluator (“IE”) for the 2028 RFP, (2)
approve the proposed 2028 RFP scoring and modeling methodology, (3) approve the
2 The Bennett Gas Expansion Project for which the Commission granted a Certificate of Public
Convenience and Necessity in Case No. IPC-E-25-29 was the only project that ranked ahead of the
Bluebird Project from the 2028 RFP 2029 Bids final shortlist.
APPLICATION FOR APPROVAL OF A PPA AND TOLLING AGREEMENT - 6
draft 2028 RFP, and (4) waive certain competitive bidding rules to allow expedited review
and approval of the 2028 RFP. On April 30, 2024, in a public meeting, the OPUC
approved the Company’s use of LEI as the IE again for Idaho Power’s 2028 RFP and
evaluation of 2028 resources. The OPUC also approved the concurrent review of both
the scoring and modeling methodologies and the draft 2028 RFP.
6. The Company worked with OPUC Staff and stakeholders to finalize the draft
2028 RFP and on August 16, 2024, Idaho Power formally issued the 2028 RFP, soliciting
bids for (1) energy market purchases and (2) new or existing resources. The 2028 RFP
was well received; the Beyond April 2028 Bids included 83 proposals from 18 different
bidders, with a total of 117 resource bids summing to nearly 20 gigawatts of resources.
The bids included a variety of ownership structures, including many bids that would result
in bidder-owned resources (i.e., PPA’s, and Battery Storage Agreements), as well as five
benchmark bids across three sites, submitted by Idaho Power’s Power Supply
department.
7. The Direct Testimony of Mr. Hackett details the bid evaluation process,
which was consistent and prescriptive as described in the 2028 RFP, ultimately identifying
the 2029 Bids final shortlist which are listed in Confidential Exhibit No. 2 to Mr. Hackett’s
Direct Testimony. As required under the OPUC competitive bidding rules, the OPUC
approved Idaho Power’s 2029 Bids final shortlist on August 19, 2025, in a public meeting.
Once the most cost-effective projects were identified, the Company’s Internal Bid Team
was provided a Notice to Proceed with the Bennett Gas Expansion Project for which the
Commission granted a Certificate of Public Convenience and Necessity in Case No. IPC-
E-25-29. In addition, Idaho Power began negotiations with the second-ranked project, the
APPLICATION FOR APPROVAL OF A PPA AND TOLLING AGREEMENT - 7
Bluebird Project, for procurement of additional resources necessary to help reduce Idaho
Power’s 2028 capacity deficit.
IV. RESOURCE DESCRIPTIONS
8. The bid evaluation process of the project proposals submitted through the
2028 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 18-month mandated competitive
bidding rule-compliant process, the Company began negotiations with developers of the
2029 Bids for procurement of resources necessary to reduce the identified 2028 capacity
deficit. On May 27, 2025, Idaho Power executed agreements associated with one of the
cost-effective projects that was able to meet the June 1, 2028, commercial operation date,
the Bluebird Project, consisting of the Bluebird PPA associated with the solar powered
generation facility supplying 200 MW of output to the Company, and the Bluebird Tolling
Agreement, providing for 100 MW of dispatchable energy storage capacity.
Bluebird PPA
9. The Bluebird PPA is 20-year PPA between Idaho Power and Bluebird Solar
Project LLC, who, under the terms of the PPA, will construct, own, operate and maintain
a solar powered generation facility located in Ada County, Idaho, with an expected
nameplate capacity of 200 MW, supplying the output to the Company. An executed copy
of the PPA is attached as Confidential Exhibit No. 4 to Mr. Hackett’s Direct Testimony.
The PPA contains levelized, fixed pricing for the 20-year term and provides that it will not
become effective unless the Commission approves all of the PPA's terms and provisions
and declares that all payments the Company makes for purchases of energy will be
APPLICATION FOR APPROVAL OF A PPA AND TOLLING AGREEMENT - 8
allowed as prudently incurred expenses for ratemaking purposes. Exhibit 5 to the PPA
sets forth the Contract Price for Contract Years 1 through 20 on a dollar per megawatt-
hour basis. The PPA is similar in many ways to the numerous energy sales agreements
approved by the Commission pursuant to the Company's obligations under the Public
Utility Regulatory Policies Act of 1978 ("PURPA"), but also contains additional other terms
and conditions consistent with industry standard, non-PURPA power purchase
agreements including pricing, security, and other terms of service.
Bluebird Tolling Agreement
10. Concurrent with execution of the Bluebird PPA, Idaho Power executed the
20-year Bluebird Tolling Agreement for a battery energy storage system located in Ada
County, Idaho, supplying 100 MW of capacity at the point of interconnection on Idaho
Power’s system, with a commercial operation date of June 1, 2028. An executed copy of
the Tolling Agreement is attached as Confidential Exhibit No. 5 to Mr. Hackett’s Direct
Testimony. The Bluebird Tolling Agreement is similar to the tolling agreement with Kuna
BESS, LLC, approved by the Commission with Order Nos. 36011 and 36016, as well as
the tolling agreement between Idaho Power and Crimson Orchard Solar, LLC, approved
by the Commission with Order Nos. 36881 and 36932.3 The Tolling Agreement acts as a
type of lease through which Bluebird Solar Project LLC will develop, design, construct,
own, and operate the battery storage system and, in accordance with the terms of the
agreement, Idaho Power has the exclusive right to dispatch and use the charging and
discharging energy in exchange for a monthly payment.
3 Case Nos. IPC-E-25-20 and IPC-E-25-27, respectively.
APPLICATION FOR APPROVAL OF A PPA AND TOLLING AGREEMENT - 9
11. The Bluebird Tolling Agreement contains fixed, monthly capacity pricing,
with no annual escalation, throughout the term of the agreement. The Contract Price is
set forth in Article I of the agreement. Section 3.1 provides that the Tolling Agreement
only becomes effective upon Commission approval of all of the terms and provisions of
as well as the accounting and regulatory treatment requested by the Company, and
declaration that all payments the Company makes to Seller for purchases of energy will
be allowed as prudently incurred expenses for ratemaking purposes. The terms of the
Bluebird Tolling Agreement, 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.
V. ACCOUNTING TREATMENT OF THE BLUEBIRD TOLLING AGREEMENT
12. Although similar to a PPA, the Tolling Agreement differs such that the
Company controls the dispatch of capacity of the battery storage facility. As such, under
Generally Accepted Accounting Principles (“GAAP”), any contract that provides the right
to control an identified asset over a period of time is considered a capital lease. The
Company must record the fixed costs associated with the Bluebird Tolling Agreement as
a lease liability, with a corresponding right-of-use asset, upon energization. Following
establishment of the lease liability and right-of-use asset, the right-of-use asset is
amortized on a straight-line basis over the 20-year contract term, resulting in the recording
of amortization expense and a corresponding entry to accumulated amortization. Also,
interest expense, calculated by applying the incremental borrowing rate to the remaining
lease liability, is recorded. The difference between the payment made to Bluebird Solar
Project LLC, and the interest expense, is the principal applied to the lease liability,
APPLICATION FOR APPROVAL OF A PPA AND TOLLING AGREEMENT - 10
reducing the outstanding lease liability each month. Both the amortization and interest
expense associated with the lease liability are comparable to the depreciation on, and
return of, a traditional capital investment, respectively. Idaho Power is requesting the
Commission acknowledge the lease accounting is necessary to facilitate the transaction
and that the expenses associated with the Bluebird Tolling Agreement are prudently
incurred expenses for ratemaking treatment.
VI. COMMUNICATIONS AND SERVICE OF PLEADINGS
13. Communications and service of pleadings with reference to this Application
should be sent to the following:
Donovan E. Walker Tim Tatum
Lead Counsel Vice President, Regulatory Affairs
Idaho Power Company Idaho Power Company
1221 West Idaho Street (83702) 1221 West Idaho Street (83702)
P.O. Box 70 P.O. Box 70
Boise, Idaho 83707 Boise, Idaho 83707
[e-mail] [e-mail]
[e-mail]
VII. MODIFIED PROCEDURE
14.The Company believes that a hearing is not necessary to consider the
issues presented herein, and respectfully requests that this Application be processed
under Modified Procedure; i.e., by written submissions rather than by hearing. RP 201,
et seq. If, however, the Commission determines that a technical hearing is required, the
Company stands ready to present its testimony and support the Application in such
hearing.
15. Both the Bluebird PPA and the Bluebird Tolling Agreement contain
provisions that the agreements only become fully effective upon Commission approval.
Further, if Commission approval is not obtained within six months of filing for such
APPLICATION FOR APPROVAL OF A PPA AND TOLLING AGREEMENT - 11
approval, then the Scheduled Commercial Operation Date may be extended on a day-
for-day basis until approval is obtained. If Commission approval is not obtained within
twelve months of filing, then either party may terminate the agreements. To help ensure
the Bluebird Project can achieve Commercial Operation by the Scheduled Commercial
Operation Date, and meet required project financing, procurement, and construction
deadlines, the Company respectfully requests a Commission decision in this proceeding
no later than December 4, 2026.
VIII. REQUEST FOR RELIEF
Idaho Power respectfully requests that the Commission issue an order by
December 4, 2026, (1) approving the 20-year PPA between Bluebird Solar Project LLC
and Idaho Power supplying the 200 MW output from the solar powered generation facility
to the Company, (2) approving the 20-year Tolling Agreement between Bluebird Solar
Project LLC and Idaho Power for 100 MW of dispatchable energy storage capacity, and
(3) acknowledging the lease accounting necessary to facilitate the transaction and that
the resulting expenses associated with both the PPA and the Tolling Agreement are
prudently incurred for ratemaking purposes. The Bluebird Project is necessary for Idaho
Power to continue to provide safe, reliability electric service in 2028 and beyond.
DATED at Boise, Idaho this 19th day of June 2026.
DONOVAN E. WALKER
Attorney for Idaho Power Company