20260715Staff Comments.pdf

RECEIVED
July 15, 2026
ERIKA K. MELANSON IDAHO PUBLIC
DEPUTY ATTORNEY GENERAL UTILITIES COMMISSION
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83702
[phone]
IDAHO BAR NO. 11560
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF IDAHO POWER )
COMPANY'S APPLICATION FOR ) CASE NO. IPC-E-26-16
APPROVAL OF THE ENERGY SALES )
AGREEMENT WITH BOISE PROJECT )
BOARD OF CONTROL FOR THE SALE AND ) COMMENTS OF THE
PURCHASE OF ELECTRIC ENERGY FROM ) COMMISSION STAFF
THE MORA DROP SMALL )
HYDROELECTRIC FACILITY )
COMMISSION STAFF ("STAFF") OF the Idaho Public Utilities Commission
("Commission"), by and through its attorney of record, Erika K. Melanson, Deputy Attorney
General, submits the following comments.
BACKGROUND
On May 29, 2026, Idaho Power Company ("Company") applied to the Commission
requesting approval of the Replacement Energy Sales Agreement("ESA")between the Company
and Boise Project Board of Control ("Seller"). Under the ESA, the Company purchases from the
Seller energy generated by the Mora Drop Small Hydroelectric Facility ("Facility"), which is a
Public Utility Regulatory Policies Act ("PURPA") Qualifying Facility ("QF") located in Kuna,
Idaho.
The Facility is currently operating under a 2006 contract between the Company and
Riverside Hydro, L.L.C. ("Riverside"), which will expire on September 15, 2026. The date also
coincides with the planned transfer of ownership from Riverside to the Seller.
STAFF COMMENTS I DULY 15, 2026

STAFF ANALYSIS
The Company requested approval of the ESA for the Facility. To determine whether the
ESA should be recommended for approval, Staff reviewed all the provisions and terms in the ESA
with a focus on the amount and the eligibility of capacity payments,the avoided cost rates,Article
XXIII(Modification), and the timeframe for seasonal-hydro evaluations. As a result of its review,
Staff recommends that the Commission approve the proposed ESA and declare all payments for
purchases of energy under the ESA be allowed as prudently incurred expenses for ratemaking
purposes.
Capacity Payments
Staff believes that the Seller is eligible for immediate capacity payments for its entire
generation capacity amount over the full term of the ESA because the Facility has contributed to
meeting the Company's need for capacity and should be granted immediate capacity payments
under the proposed ESA. Previously, the Commission has allowed QFs that have contributed to
meeting a utility's capacity needs during their original contract term to receive capacity payments.
See, e.g.,Case Nos. IPC-E-19-04,IPC-E-19-30,and IPC-E-19-35. During the contract term of the
2006 Agreement, the Company has acquired significant amounts of capacity to meet its capacity
needs. For example, the Company has acquired resources in 2023', 20242, and 20253 to address
system capacity deficiencies in these years.
Staff also compared the Maximum Capacity Amount in the proposed ESA and the
Maximum Capacity Amount in the 2006 contract. When a proposed Maximum Capacity Amount
is greater than the Maximum Capacity Amount in the original contract, the Commission has
determined that the Seller should not receive capacity payments for the incremental amount of
capacity until the first capacity deficit date. See, e.g., Order Nos. 34956, 35262, and 35223. Since
the Maximum Capacity Amount in the proposed ESA is 1.7 megawatts ("MW"),which is smaller
than the 1.9 MW in the 2006 contract, the Seller should be granted immediate capacity payments
for its entire amount of generation over the full term of the proposed ESA.
1 Case No. IPC-E-22-13.
2 Case Nos.IPC-E-23-05 and IPC-E-23-20.
s Case No. IPC-E-23-20.
STAFF COMMENTS 2 JULY 15, 2026

Avoided Cost Rates
Staff verified that the avoided cost rates contained in the proposed ESA are correct based
on the rates approved in Commission Order No. 36974.
Article XXIII (Modification)
Staff reviewed Article XXIII (Modification) in the ESA that addresses potential
modifications to the Facility and believes the language complies with Order No. 35705. That
Order requires language: (1) restricting a QF seller from modifying their facility from the as-built
description of the facility in the contract, without promptly notifying the Company of that intent;
(2) requiring the seller to provide notification of planned modifications such as fuel change or
capacity size change to the as-built description; (3) requiring parties to amend the contract
reflecting the facility as actually modified; and (4) ensuring that the payment structure allows
payment for only the proper authorized rates of the facility as actually modified and as of the date
when energy is first delivered as a modified facility.
Staff believes that these requirements are met by Article XXIII(Modification)in the ESA.
Specifically, the first requirement is met by Paragraph 23.2. The second requirement is met by
Paragraph 23.2.2. The third requirement is met by Paragraph 23.5. The fourth requirement is met
by Paragraph 23.4.1 and Paragraph 23.6.
Timeframe for Seasonal-Hydro Evaluations
To qualify for the seasonal hydro rates, a QF must produce at least 55% of its annual
generation during the months of June through August each calendar year. Order No. 32802 at 5,
6. Subsequently, the Commission allowed the annual evaluation timeframe to be from June 1
through May 31 of the following year. Order No. 35908 at 5, 6. The proposed ESA uses a
timeframe from June 1 through May 31, which is allowed under Order No. 35908.
STAFF RECOMMENDATION
Staff recommends that the Commission approve the proposed ESA and declare all
payments for purchases of energy under the ESA be allowed as prudently incurred expenses for
ratemaking purposes.
STAFF COMMENTS 3 JULY 15, 2026

Respectfully submitted this 15th day of July 2026.
Erika K. Melanson
Deputy Attorney General
Technical Staff. Yao Yin
I:\Utility\UMISC\COMMENTS\IPC-E-26-16 Comments.docx
STAFF COMMENTS 4 JULY 15, 2026

CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 15TH DAY OF JULY 2026, SERVED
THE FOREGOING COMMENTS OF THE COMMISSION STAFF, IN CASE NO. IPC-
E-26-16, BY E-MAILING A COPY THEREOF, TO THE FOLLOWING:
DONOVAN E. WALKER ENERGY CONTRACTS
LISA C. LANCE IDAHO POWER COMPANY
REGULATORY DOCKETS PO BOX 70
IDAHO POWER COMPANY BOISE ID 83707
PO BOX 70 E-MAIL:
BOISE ID 83707 energycontractsgidahopower.com
E-MAIL:
dwalker(i�jdahopower.com
llancegidahopower.com
docketsgidahopower.com
PATRICIA JORDA9, SECRETARY
CERTIFICATE OF SERVICE