20220615Avista to Staff 1-11.pdf

AVISTA CORPORATION
RESPONSE TO REQIIEST FOR INFORMATION
DATE PREPARED: 06I|412022
.lr.-.-,.' i .f li-ll.l;' :' '!;tUirruRISDICTION:
CASE NO:
REQUESTER:
TYPE:
REQUEST NO.:
IDAHO
AVU-E-22-07
IPUC
Production Request
StaflOO1
WITNESS:
RESPONDER:
DEPARTMENT:
TELEPHONE:
N/A
Kevin Holland
Power Supply
(s0e) 4es-21e4
REQUEST:
Please explain why the contract term is for only one-year.
RESPONSE:
As stated in the Joint Petition of Avista Corporation and Ford Hydro Limited Partrrership filed in
this proceeding on May 11,2022 ("Joint Petition"), "Ford Hydro has requested a one-year tetrrn."
Joint Petition at 3. However, Avista and Jim Ford have elected to extend the one-year term to a
two-year term. Avista anticipates filing an amended and restated Agreement that, among other
things, revises the term from one year to two years.
AVISTA CORPORATION
RESPONSE TO REQUEST FOR INFORMATION
ruRISDICTION:
CASE NO:
REQUESTER:
TYPE:
REQUEST NO.:
IDAHO
AVU-E-22-07
IPUC
Production Request
Stafl002
DATE PREPARED: 0611412022WITNESS: N/A
RESPONDER: Kevin Holland
DEPARTMENT: Power SupplyTELEPHoNE: (509) 49s-2194
REQUEST:
The original 1985 contract stated the nameplate capacity was 1,500 kilowatts ("kW"), but the
renewal contract states the nameplate capacity is 1,499 kW. Please respond to the following.
a. Please reconcile the two numbers.
b. What was the installed nameplate capacity when the Facility was first constructed?
c. Has the nameplate capacity changed since construction? Please explain.
RESPONSE:
a. It is unclear why the 1985 stated capacity was 1,500 kW. The 1,499 kW is the current
capacity as provided by Project Developer.
b. It is unclear whether the 1,500 kW was an inaccurate rounding or the initial installed
capacity. 1,499 kW is the current stated capacity as provided by Project Developer.
c. It is unclear whether the capacity changed or was previously rounded to 1,500 kW.
AVISTA CORPORATION
RESPONSE TO REQUEST FOR INFORMATION
ruRISDICTION:
CASE NO:
REQUESTER:
TYPE:
REQUEST NO.:
IDAHO
AVU-E-22-07
IPUC
Production Request
Staff-003
DATE PREPARED: 0611412022WITNESS: N/A
RESPONDER: Kevin Holland
DEPARTMENT: Power Supply
TELEPHONE: [phone]
REQUEST:
Please respond to the following regarding the Facility's Designated Network Resource ("DNR')
status.
a. Will the Facility lose its DNR status and become incapable of selling power to the Company
after the current 1985 contract expires on June 30,2022? Please explain.
b. Please confirm that DNR status can be only requested after a power purchase agreement is
executed.
c. Have the parties in this ctlse requested the DNR status? Please explain.
d. If so, please provide an approximate date when the DNR status will be granted.
RBSPONSE:
a. No. Avista and Ford Hydro have executed a new power purchase agreement that the parties
intend to be effective upon expiration ofthe current contract. Accordingly, the DNR status
should not be affected. Notably, DNR status is not required for PURPA projects. Although
Avista currently has designated the Facility as a DNR, Avista may designate or
undesignated the Facility at any time in accordance with Federal Energy Regulatory
Commission ("FERC") requirements.
b. The ability to designate a resource as a DNR is dictated by FERC requirements. Section
29.2(viii) of Avista's FERC-approved Open Access Transmission Tariff requires:
A staternent signed by an authorized officer from or agent of the Network Customer
attesting that all of the Network Resources listed pursuant to Section 29.2(v) satisff the
following conditions: (1) the Network Customer owns the resource, has committed to
purchase generation pursuant to an executed contract, or has committed to purchase
generation where execution of a contract is contingent upon the availability of transmission
service under Part III of the Tariff; and (2) the Network Resources do not include any
resources, or any portion thereof, that are committed for sale to non-designated third party
load or otherwise cannot be called upon to meet the Network Customer's Network Load on
a non-intemrptible basis, except for purposes of fulfilling obligations under a reserve
sharing program[.]
Avista will only designate the Facility as a DNR if FERC's requirements are satisfied.
c. As Avista and Ford Hydro have an executed PPA covering the time period until through
Jwrc 2023, Avista has included Ford Hydro as a DNR on the system through that period.
Avista anticipates that the new PPA will be effective upon expiration of the current PPA
and, therefore, Avista anticipates including Ford Hydro as a DNR after the current PPA
expires.
d. Ford Hydro is currently an Avista DNR Unless a requirement for designating Ford Hydro
is, in the future, not satisfie( Avista does not anticipate a change in the status. For this, and
oth€r, reasons, Avista executd, and filed with the Commission, the new PPA om May 11,
2022,to ensure that there would be no intemrption when the current contract expires at the
end ofJune 2022.
AVISTA CORPORATION
RESPONSE TO REQUEST FOR TNFORMATION
JURISDICTION:
CASE NO:
REQUESTER:
TYPE:
REQUEST NO.:
IDAHO
AYU-E-22-07
IPUC
Production Request
Stafl004
DATE PREPARED: 0611412022WITNESS: N/A
RESPONDER: Kevin Holland
DEPARTMENT: Power Supply
TELEPHONE: (s09) 49s-2194
REQUEST:
Assuming the Agreement is not approved before July 1, 2022, for the period between July 1,2022
and the Commission's approval (the lapse contract period), what rate does the Company propose to
pay the Seller for the energy delivered? Please provide justification for the proposed rate. Also,
does the Seller plan to sell energy to the Company during the lapse contract period?
RESPONSE:
The assumption is that the new contract would be approved and in place prior to the expiration of
the existing contact. Avista executed the new PPA and filed it with the Commission on May I l,
2022. Accordingly, the rates that will be paid will be the current applicable avoided cost rates in
efflect as of the effective date of the new PPA. See also Avista's response to Staf[-PR-007. If the
contract is not approved, Avista will pay the new rate effective June l,2022,unti1 such time as it is
approved. There is a provision that the contract would expire if approval is not received within a
specified timeframe.
AVISTA CORPORATION
RESPONSE TO REQUEST FOR INFORMATTON
JURISDICTION:
CASE NO:
REQUESTER:
TYPE:
REQUEST NO.:
IDAHO
AVU-E-22-07
IPUC
Production Request
Staft005
DATE PREPARED: 06/1412022WITNESS: N/A
RESPONDER: Kevin Holland
DEPARTMENT: Power Supply
TELEPHONE: [phone]
REQUEST:
Please respond to the following regarding the avoided cost rates in the original, 1985 contract.
a. Did the avoided cost rates contained in the original 1985 conftact include avoided cost of
capacity? Please explain.
b. Please provide the Order number that determined the avoided cost rates contained in the
original 1985 conhact.
RESPONSE:
a. Yes. Per the 1985 confract, Section 6 Determination of Payment states "...payments to
Seller by Water Power each month for electric energy and capacitv delivered to Water
Power ...." emphasis added. In addition, we have been including this resource in our Load
and Resource Obligations since that time.
b. Avista does not have a copy of the requested order.
AVISTA CORPORATION
RESPONSE TO REQITEST FOR INFORMATION
ruRISDICTION:
CASE NO:
REQUESTER:
TYPE:
REQUEST NO.:
IDAHO
AYU-E-22-07
IPUC
Production Request
Stafl006
DATE PREPARED: 0611412022WITNESS: N/A
RESPONDER: Kevin Holland
DEPARTMENT: Power Supply
TELEPHONE: [phone]
REQUESTI
Please list all the identified capacity deficiency periods that required the Company to add
resources since 1985 and provide the capacity resources that were acfually added and the dates
when they we,nt online.
RESPONSE:
Please see the Company's response to StaffiPR-005.
AVISTA CORPORATION
RESPONSE TO REQUEST FOR TNFORMATTON
JURISDICTION:
CASE NO:
REQUESTER:
TYPE:
REQUEST NO.:
IDAHO
A)/I.J-E-22-07
IPUC
Production Request
Staff-007
DATE PREPARED: 0611412022WITNESS: N/A
RESPONDER: Kevin Holland
DEPARTMENT: Power Supply
TELEPHONE: (s09) 49s-2194
REQUEST:
The proposed avoided cost rates contained in the Agreement are based on the rates from
GNR-E-22-01, which became effective on June 1,2022. However, the Agreernent was executed
on May 11,2022. Please explain why the parties did not use the published avoided cost rates
effective on May 11,2022.
RESPONSE:
The Effective Date of the new Agreement is July l, 2022.In order to ensure that there would be
time for the Commission to approve the Agreernent prior to the Effective Date, Avista and Ford
Hydro executed, and filed, the new Agreernent on May 11,2022. Given that the early execution
date is to accommodate the Commission's approval, it would not be appropriate to penalize the QF
for Avista's need to execute the Agreement prior to the dates upon which the new rates became
effective. Altematively, the QF could have required Avista to wait until after the new rates became
effective prior to executing a new contract, which would have significantly limited the time for
obtaining Commission approval.
Avista acknowledges that the general rule is that the rates in effect at the time of the Legally
Enforceable Obligation ("LEO") are the rates that apply. Avista further acknowledges that the
general rule is that the LEO occurs when the agreement is executed. However, that general rule
does not prohibit the parties to an agreement from mutually agreeing that the LEO arises at some
date other than the date of execution. In this instance, the QF had a choice to either (1) wait until
the new rates were in effect to execute the Agreement in order to get the rates that would be in
effect on the Ef,fective Date, which would have significantly limited the time for the Commission
to review and approve the Agreement, or (2) for the parties to effectively mutually agree that the
LEO occurs on the Effective Date rather than the execution date, which allowed the parties to
execute and file the Agreement eady enough to allow for review and approval prior to the
Effective Date.
Under these circumstances, where a renewal occurs shortly after new rates become effective such
that execution of the agreement at the time new rates become effective will not provide sufEcient
time for Commission review and approval prior to the Effective Date, it is appropriate (if the
parties mutually agree) to use the rates that are in effect on the Effective Date. This practical
solution allows the parties to execute and file an agreement before the new rates become effective
to allow sufficient time for Commission review and approval.
AYISTA CORPORATION
RESPONSE TO REQTJEST FOR INFORMATION
JURISDICTION:
CASE NO:
REQUESTER:
TYPE:
REQUEST NO.:
IDAHO
AI/r.J-E-22-07
IPUC
Production Request
Stafl008
DATE PREPARED: 0611412022WITNESS: N/A
RESPONDER: Kevin Holland
DEPARTMENT: Power Supply
TELEPHONE: (s09) 49s-2t94
REQUEST:
Section 1.23 (the definition of Surplus Energy) states that the monthly generation estimates for the
purpose of the 90/110 rule are specified in Section 6.3. However, the estimates are not provided in
Section 6.3. Please provide the monthly generation estimates.
RESPONSE:
Jan 438,000
Feb 520,000
Mar 648"000
Apr 664,000
May 248.000
Jun 75,000
July 0
Aug 0
Sep 0
Oct 0
Nov 0
Dec 180,000
*volumes in kwhs
AVISTA CORPORATION
RESPONSE TO REQUEST FOR TNFORMATTON
ruRISDICTION:
CASE NO:
REQUESTER:
TYPE:
REQUEST NO.:
IDAHO
AYU-E-22-07
IPUC
Production Request
Staff-009
DATE PREPARED: 0611412022WITNESS: N/A
RESPONDER: Kevin Holland
DEPARTMENT: Power Supply
TELEPHONE: [phone]t94
REQUEST:
Section 6.2 states that "[t]he maximum annual amount of electric power that Avista is obligated to
purchase hereunder shall be 5000 megawatt-hours ("MWh") in any Operating Year which is a
non-Leap Year, or 5000 MWhs in any Operating Year which is a Leap Year." Please respond to
the following.
a. How is the 5000 MWhs determined?
b. Why is the maximum annual amount of a non-Leap Year the same as the maximum annual
amount of a Leap Year?
c. What is the relationship between the 5000 MWhs and the sum of the monthly generation
estimates provided in Request No. 8?
d. What is the relationship between the 5000 MWhs and the ll0% of the sum of the monthly
generation estimates provided in Request No. 8?
RESPONSE:
a. The 5,000 MWh was a mutually agreed upon maximum amount. It is intended to serve as a
reasonable cap that would allow for an above normal water/generation year while at the
same time providing a cap to avoid significant generation increases due to unanticipated
operational changes.
b. See part (a) above for explanation on the estimate which is an agreed upon number that is
flexible enough not to be affected by one day's generation.
c. The relationship is the 5,000 MWh is an amountbothparties are comfortable is sufficiently
greater than the sum of the monthly estimates but also provides a cap as described in (a)
above. This cap is intended to allow for reasonable changes in generation compared to
estimates due to increase flows but provides a cap to avoid increases due to facility
upgrades. StaffProduction Request Number 8 is a monthly generation estimate provided
by the generator.
d. There is no relationship between the 5,000 MWh and 90/110. The 90/110 only has a
relationship to the individual monthly estimates.
AVISTA CORPORATION
RESPONSE TO REQUEST FOR TNFORMATION
JURISDICTION: IDAHO
CASE NO: AW-E-22-07
REQUESTER: IPUCTYPE: Production Request
REQUESTNO.: Staff-0l0
DATE PREPARED: 0611412022
WITNESS: N/A
RESPONDER: Kevin Holland
DEPARTMENT: Power Supply
TELEPHONE: [phone]
REQUEST:
Section 6.3.1 states that Project Developer shall provide monthly generation estimates for both the
initial year and each subsequent year. However, the Agreement term in this case is only one-year.
Please explain why Project Developer shall provide monthly generation estimates for "each
subsequent year".
RESPONSE:
The requirement to provide monthly generation estimates for "each subsequent yeat''is standard
language in Avista's PURPA PPAs. Where, as here, the term is for a single year, the language is
moot. Nevertheless, the language was retained because (i) it is moot for a one-year term, and (ii) is
helpful to retain in the event the Agreement is later amended to extend the term. In short, inclusion
of the language is moot and retaining it does no harm. It is worth noting that and the Project
Developer and Avista have agreed to extend the contract to a two-year term. The parties intend to
file an amended and restated Agreement that, among other things, extends the term to two years.
Accordingly, ny concerns the inclusion of this language will be superseded by that
amended and restated Agreonent.
AYISTA CORPORATION
RESPONSE TO REQUEST FOR TNFORMATTON
ruRISDICTION
CASE NO:
REQUESTER:
TYPE:
REQUEST NO.:
IDAHO
AVU-E-22-07
IPUC
Production Request
Staff-0l1
DATE PREPARED: 0611412022WITNESS: N/A
RESPONDER: Kevin Holland
DEPARTMENT: Power Supply
TELEPHONE: [phone]
REQUEST:
Section 6.3.2 allows the Seller to provide updates to the monthly generation estimates at least
one-month in advance. However, Section 6.3.5 requires the Seller to use a difterent timeframe.
Please reconcile the two timeframes and explain which one should be used.
RESPONSE:
Section 6.3.2 the Project Developer may provide Avista updated monthly Net Delivered Output
estimates for the month following the next month. (For example prior to July 31 the Project
developer may provide estimates for Septernber). This is a near-term modification.
Section 6.3.5 Provides an additional opportunity for the Developer to provide Avista with updated
Net Delivered Output estimates. However, these updates cannot pertain to the three consecutive
monthly immediately following the month in which estimates were updated. This Section is
intended to provide a period more than one month atread.