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Home My WebLink About20120515IPC to Staff10-17.pdfIDAHO PNER® REC 0 An IDACORP Company .. 5 PM : 28 DONOVAN E. WALKER 16'Ahr 011) Lead Counsel 1 P4 dwalkercidah000wer.com UTtL1T 4T4SS0 May 15, 2012 VIA HAND DELIVERY Jean D. Jewell, Secretary Idaho Public Utilities Commission 472 West Washington Street Boise, Idaho 83702 Re: Case No. IPC-E-10-19 Grand View Solar One PV, LLC, FESA - Response to the Idaho Public Utilities Commission Staffs Third Production Request Dear Ms. Jewell: Enclosed for filing please find an original and three (3) copies of Idaho Power Company's Response to the Third Production Request of the Commission Staff to Idaho Power Company in the above matter. ovanE.:lk&ó DEW:csb Enclosures 1221 W. Idaho St. (83702) P.O. Box 70 Boise, ID 83707 DONOVAN E. WALKER (ISB No. 5921) JASON B. WILLIAMS (ISB No. 8718) Idaho Power Company 1221 West Idaho Street (83702) P.O. Box 70 Boise, Idaho 83707 Telephone: (208) 388-5317 Facsimile: (208) 388-6936 dwaIkeridahopower.com jwiIliamsidahopower.com 20i2 NAY I5 Pflt:28 IDAHO UTILITIES COMp1S510 Attorneys for Idaho Power Company BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION IN THE MATTER OF AMENDMENTS TO THE FIRM ENERGY SALES AGREEMENT BETWEEN IDAHO POWER COMPANY AND GRAND VIEW SOLAR ONE PV, LLC. CASE NO. IPC-E-10-19 IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY COMES NOW, Idaho Power Company ("Idaho Power" or "Company"), and in response to the Third Production Request of the Commission Staff to Idaho Power Company dated April 24, 2012, herewith submits the following information: IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY -1 REQUEST NO. 10: Please explain why Idaho Power believes that an extension until no later than January 12, 2013 is a fair and commercially reasonably time period for Grand View Solar One to achieve its operation date. In your explanation, please discuss specifically how Idaho Power defines the phrase "commercially reasonable." RESPONSE TO REQUEST NO. 10: The establishment of a firm Commercial Operation Date of January 12, 2013, was considered to be commercially reasonable based on Idaho Powers desire for a date certain Commercial Operation Date and the parties' dispute as to the proper interpretation of the language contained in Appendix B of the Firm Energy Sales Agreement between Idaho Power and Grand View Solar One PV, LLC dated June 8, 2010 ("FESA") approved by the Idaho Public Utilities Commission in Order No. 32068 issued September 14, 2010. Specifically, the Scheduled Operation Date specified in Appendix B, item B-3 is defined as: 1.) 90 days past the date identified within the final Facility Study report in which Idaho Power shall have completed installation of the Idaho Power interconnection equipment as the Scheduled Operation Date or 2.) If by Seller action or inaction, a final Facility Study is not completed or the installation of Idaho Power interconnection equipment is delayed, January 30, 2011 shall be the Scheduled Operation Date. As part of agreeing to set a firm Commercial Operation Date, Grand View Solar One PV, LLC ("Grand View Solar One") agreed to immediately refresh its Delay Security, which had recently expired, as well as immediately pay the required $475,000 deposit for construction of its generator interconnection facilities. Based upon the good faith dispute among the parties as well as Grand View Solar One's immediate remedy and payment of the necessary funding for the project, Idaho Power determined that settling this matter with Grand View Solar One was both fair and commercially IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY -2 reasonable. While I am not an attorney, my understanding of the phrase "commercially reasonable" is that it is a legal term of art that is based upon all the facts and circumstances of a particular situation. As described above, Idaho Power believes that based upon all the facts and circumstances of this situation, it was commercially reasonable to enter into the Letter Agreement with Grand View Solar One. The response to this Request was prepared by Randy C. Allphin, Energy Contracts Coordinator Leader, Idaho Power Company, in consultation with Donovan E. Walker, Lead Counsel, Idaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY -3 REQUEST NO. 11: Please explain Idaho Powers understanding of the reasons given by Grand View Solar One for not meeting the Scheduled Operation Date as specified in ¶ B-3 of Appendix B of the FESA. RESPONSE TO REQUEST NO. 11: Idaho Power's understanding of Grand View Solar One's reasons for not meeting the Scheduled Operation Date was that it had a different interpretation than Idaho Power of the Scheduled Operation Date, as well as Grand View Solar One's claim that it was unable to secure financing to make the required payments to construct the necessary interconnection facilities. The response to this Request was prepared by Randy C. Allphin, Energy Contracts Coordinator Leader, Idaho Power Company, in consultation with Donovan E. Walker, Lead Counsel, Idaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY -4 REQUEST NO. 12: Please submit an amendment to Article VII in the FESA (rates portion) to accommodate a full 20 year contract term (unless Idaho Power and Grand View are now proposing less than a 20-year contract term). RESPONSE TO REQUEST NO. 12: The Company has not prepared an amendment to Article VII in the FESA. If the Commission directs the Company to amend the FESA, the Company will do so. The response to this Request was prepared by Randy C. Aliphin, Energy Contracts Coordinator Leader, Idaho Power Company, in consultation with Donovan E. Walker, Lead Counsel, Idaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY -5 REQUEST NO. 13: Please identify any interconnection and/or transmission studies that are required for the project and state the status of each (i.e., completed, in- progress, etc.). Please also indicate whether Grand View Solar One is current on any required payments for the studies. RESPONSE TO REQUEST NO. 13: A Feasibility, System Impact, and Facility Study were completed for Grand View Solar One's interconnection. The required deposits have been paid for all three studies. Final costs, as estimated in the Facility Study, will ultimately be trued-up to actuals upon final completion of construction. The response to this Request was prepared by Josh Harris, Operations Analyst I, Idaho Power Company, in consultation with Donovan E. Walker, Lead Counsel, Idaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY -6 REQUEST NO. 14: Please discuss whether any interconnection and transmission facilities have been constructed or upgraded to date in order to accommodate the Grand View Solar One facility. Please list any amounts paid by either Idaho Power or Grand View for construction of these facilities. RESPONSE TO REQUEST NO. 14: On April 5, 2012, Idaho Power received a construction deposit from the project in the amount of $475,000 and is in the initial phases of detailed design, scheduling, and construction of the interconnection facility. The response to this Request was prepared by Josh Harris, Operations Analyst I, Idaho Power Company, in consultation with Donovan E. Walker, Lead Counsel, Idaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY -7 REQUEST NO. 15: Please explain how Idaho Power intends to determine when the Grand View Solar One facility has met its revised Scheduled Operation Date. For example, this project will consist of approximately 75,000 PV panels. How many panels have to be operational before the facility will be deemed to have met its Scheduled Operation Date? RESPONSE TO REQUEST NO. 15: As identified in this Request, the fact that this project will consist of approximately 75,000 separate generation units (PV panels) makes the identification of "operation" and "complete" significantly different issues than a hydro unit with a single generator or even a wind project with 10 wind turbines Unfortunately, the agreement does not specifically address this issue. Idaho Power intends to interpret and implement this in a commercially reasonable manner. It is Idaho Power's understanding that the multiple panels will be aggregated in smaller groups which will be connected to individual inverters. Idaho Power has not received data from this project on this precise configuration, but in other proposed solar PV projects, use of 2 megawatt inverters was proposed. Thus, if the same equipment is planned to be used in this project, it would require 10 inverters. Idaho Power believes a reasonable interpretation of operational and complete would be that all of the designed inverters have been installed, interconnected, and are delivering energy to Idaho Power's system. In addition, the bank of PV panels supplying each inverter must be materially complete. For example, a planned bank of 7,000 panels that only 1,000 panels are installed would not be materially complete. As to the exact panel count to qualify as materially complete, this is not specifically known at this time and will be IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY -8 determined at the time the completion status becomes an issue, at which time all information and circumstances will be considered. The response to this Request was prepared by Randy C. Allphin, Energy Contracts Coordinator Leader, Idaho Power Company, in consultation with Donovan E. Walker, Lead Counsel, Idaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY -9 REQUEST NO. 16: Please explain why Grand View Solar One disputes Idaho Power's interpretation of the FESA that the Scheduled Operation Date was January 30, 2012, and instead asserts that the FESA has a "rolling" scheduled operation date as stated in Idaho Power's April 3, 2012 Letter of Understanding and Agreement with Grand View. Does Idaho Power believe that there is ambiguous language in the FESA that needs to be revised for use in future contracts? RESPONSE TO REQUEST NO. 16: Idaho Power believes there is language in the Grand View Solar One FESA which has created some uncertainty of the Scheduled Operation Date. The proposed Letter Agreement has resolved this issue for this FESA and the language originally in this FESA has not been used in any other qualifying facility agreements. Please see Idaho Power's response to the Idaho Public Utilities Commission Staffs Production Request No. 10. Idaho Power continues to explore solutions to the coordination of the Generation Interconnection process and the Scheduled Operation Date within the FESA. The response to this Request was prepared by Randy C. Allphin, Energy Contracts Coordinator Leader, Idaho Power Company, in consultation with Donovan E. Walker, Lead Counsel, Idaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY -10 REQUEST NO. 17: Please confirm whether Grand View Solar One posted security in the amount of $810,000 no later than April 6, 2012 by 5:00 pm as required by the April 3, 2012 letter Agreement between the parties. RESPONSE TO REQUEST NO. 17: Yes, Idaho Power confirms that security in the amount of $810,000 was received from the project prior to the 5:00 p.m. deadline. The response to this Request was prepared by Randy C. Allphin, Energy Contracts Coordinator Leader, Idaho Power Company, in consultation with Donovan E. Walker, Lead Counsel, Idaho Power Company. DATED at Boise, Idaho, this 15th day of May 2012. iOVAN E. WALKER Attorney for Idaho Power Company IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY -11 CERTIFICATE OF SERVICE I HEREBY CERTIFY that on this 15th day of May 2012 I served a true and correct copy of IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY upon the following named parties by the method indicated below, and addressed to the following: Commission Staff Kristine A. Sasser Deputy Attorney General Idaho Public Utilities Commission 472 West Washington (83702) P.O. Box 83720 Boise, Idaho 83720-0074 Grand View Solar One PV, LLC Peter J. Richardson Gregory M. Adams RICHARDSON & O'LEARY, PLLC 515 North 27th Street (83702) P.O. Box 7218 Boise, Idaho 83707 Hand Delivered U.S. Mail Overnight Mail FAX X Email kris.sasserpuc.idaho.qov Hand Delivered U.S. Mail Overnight Mail FAX X Email peterrichardsonandoIearv.com qreq(ärichardsonandoleary.com Sean Stocker, Director of Development Hand Delivered Corona Capital Partners, LLC U.S. Mail 300 Great Oaks Boulevard, Suite 320 Overnight Mail Albany, New York 12203 FAX X Email sstocker(äcoronacapitalpartners.com 5 Whitney Lane New Ulm, Minnesota 56073 p )\tVt&frj (LA Ci1sta Bearry, Legal Assistant IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY -12