20200623IPC to Staff 6-24.pdf

DONOVAN WALKER
Lead Counsel
[e-mail]

July 14, 2020

ELECTRONIC FILING

Diane Hanian, Secretary
Idaho Public Utilities Commission
11331 W. Chinden Boulevard
Building 8, Suite 201-A
Boise, Idaho 83714

Re: Case No. IPC-E-20-02
Avoided Cost Rates and Terms for Energy Storage Qualifying Facilities
Under PURPA – Idaho Power Company’s Response to the Second
Production Request of the Commission Staff

Dear Ms. Hanian:

Attached for electronic filing is Idaho Power Company’s Response to the remaining
requests in the Second Production Request of the Commission Staff. The AURORA setup
files that respond to Production Request 19 are too voluminous for e-mail transmittal and
instead will be made available to the parties on the Company’s discovery FTP site. Please
contact Mark Annis, Senior Regulatory Analyst, at [phone] or
[e-mail] for access to the FTP site. If you have any questions about the
attached documents, please do not hesitate to contact me.

Very truly yours,

_____________________________
Donovan Walker

DW:cld

Attachments
RECEIVED
2020 July 14, PM 4:24
IDAHO PUBLIC
UTILITIES COMMISSION
IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
PRODUCTION REQUEST OF THE COMMISSION STAFF - 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 PETITION TO ESTABLISH
AVOIDED COST RATES AND TERMS FOR
ENERGY STORAGE QUALIFYING
FACILITIES UNDER PURPA
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CASE NO. IPC-E-20-02

IDAHO POWER COMPANY’S
RESPONSE TO THE SECOND
PRODUCTION REQUEST OF
THE COMMISSION STAFF

COMES NOW, Idaho Power Company (“Idaho Power” or “Company”), and in
response to the Second Production Request of the Commission Staff to Idaho Power
Company dated June 23, 2020, herewith submits the following information:

IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
PRODUCTION REQUEST OF THE COMMISSION STAFF - 2
REQUEST NO. 6: How many requests for indicative pricing has Idaho Power
received for energy storage QFs?
RESPONSE TO REQUEST NO. 6: Idaho Power has received nine requests for
indicative pricing from projects proposed as energy storage Qualifying Facilities.
The response to this Request is sponsored by Michael Darrington, Energy
Contracts Leader, Idaho Power Company.

IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
PRODUCTION REQUEST OF THE COMMISSION STAFF - 3
REQUEST NO. 7: How many IRP-based solar QFs and wind QFs have
signed ESAs since the Commission reduced the IRP-based contract term to two
years? How many solar QFs and wind QFs have signed published ESAs since the
Commission reduced the IRP-based contract term to two years? What other
factors, in addition to the reduced contract term, likely contributed to this amount of
wind and solar QF contracts being executed with the Company?
RESPONSE TO REQUEST NO. 7: At the time the Commission issued Order
No. 33357 in Case No. IPC-E-15-01, which implemented two-year contract terms for
incremental cost Integrated Resource Plan (“ICIRP”) based contracts, Idaho Power and
its customers were faced with the potential to acquire over a thousand MW of new solar
generation Qualifying Facilities (“QFs”) under PURPA, none of which was required to
meet customer load as identified in the Company’s Integrated Resource Plan (“IRP”).
This was in addition to the 1,088 MW of nameplate capacity from wind and solar QFs
already under contract at that time. However, since the Commission issued Order No.
33357 in 2015, the Company has not entered into any new Idaho-jurisdictional PURPA
energy sales agreements based on the ICIRP methodology. Since the Commission
reduced the published rate eligibility cap to 100 kW, the Company has not entered into
any new wind or solar energy sales agreements based on published avoided cost rates
for wind and solar. Idaho Power has entered into one ICIRP-based contract subject to
its Oregon jurisdiction along with four Oregon standard agreements.
Idaho Power does not know the myriad of factors that go into how, when,
and why QF projects are developed, but what the Company does know is that at the
time the published avoided cost rate cap was set at 100 kW, Idaho Power had an
IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
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extremely large amount of PURPA QFs proposing to develop projects on its system.
Since the published rate cap of 100 kW was established, the Company has experienced
a massive quantity of MWs and projects that have applied for interconnection as
network resources in Idaho Power’s generator interconnection queue. In fact, as
recently as March 2020, there were approximately 2,400 MW from 12 solar projects and
2,100 MW from 3 wind projects in the interconnection queue. Idaho Power believes that
this identifies that renewable generation resource developers are interested in pursuing
projects that are appropriately sized based on the economic viability of the proposed
projects rather than pursuing them in specific size increments to take advantage of
utility customers through PURPA. Although Idaho Power has not executed any two-year
energy sales agreements with wind and solar QFs, the Company has entered into a
non-PURPA Power Purchase Agreement for 120 MW of solar generation with contract
prices that are substantially lower than PURPA avoided cost prices. See Case No. IPC-
E-19-14. Idaho Power believes that if the eligibility cap for published avoided costs was
to be increased from the federally required 100 kW amount and the requirement for two-
year contracts was removed, the motivation for appropriately sized and priced projects
would no longer exist and the Company would face another inundation of PURPA QF
projects being forced upon the utility.
The response to this Request is sponsored by Michael Darrington, Energy
Contracts Leader, Idaho Power Company.

IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
PRODUCTION REQUEST OF THE COMMISSION STAFF - 5
REQUEST NO. 9: What are the standard contract terms currently included in a
published contract for projects under the applicable eligibility cap? Please provide a
standard published contract for wind QFs, solar QFs, and all other QFs. Please
describe any and all changes to the standard contract terms over the last ten years.
RESPONSE TO REQUEST NO. 9: The Idaho Public Utilities Commission
(“Commission”) has never required a standard pro-forma energy sales agreement
(“ESA”) template for PURPA Qualifying Facilities (“QF”). However, one has been
generally developed by default through terms and conditions that have been directed to
be included in ESAs by the Commission or by the inclusion of terms and conditions that
have been previously approved in ESAs by the Commission. Although the Commission
does not require a standard form contract, it does require each PURPA ESA to be
individually submitted to the Commission for its independent review for approval or
rejection. Commission approval is required for an Idaho PURPA ESA to be fully
effective. Because each PURPA ESA is submitted for review, Commission Staff has the
opportunity to see every contract that is filed and become familiar with the terms and
conditions contained in PURPA agreements.
The standardized contract provisions found in published avoided cost rate
PURPA ESAs are generally the same for all resource types, except for seasonal hydro.
Commission Order No. 32802 requires that seasonal hydro QFs meet certain criteria to
be eligible for the seasonal hydro published avoided cost rates. PURPA ESAs with
seasonal hydro projects require that the QF must maintain the seasonal hydro eligibility
criteria during the term of the agreement, or it reverts to a non-seasonal hydro facility.
ESAs applicable to wind and solar QFs also include integration charges as contained in
IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
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tariff Schedule 87 and a requirement to share in the cost of wind and solar production
forecasting models.
On June 25, 2020, Idaho Power filed an Application containing an energy sales
agreement for the Coleman Hydro QF that is based on published avoided cost rates.
See Case No. IPC-E-20-27. If approved by the Commission, this contract would likely
serve as the template for a new energy sales agreement, with adjustments for the
proper resource type.
The response to this Request is sponsored by Michael Darrington, Energy
Contracts Leader, Idaho Power Company.

IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
PRODUCTION REQUEST OF THE COMMISSION STAFF - 7
REQUEST NO. 10: What are the standard contract terms included in ESAs
for QFs above the applicable eligibility cap? What contract terms are typically
subject to negotiation between QFs and the Company for QFs above the applicable
eligibility cap? Please provide an ESA that serves as the starting point for
negotiations with wind QFs, solar QFs, and all other QFs above the respective
eligibility caps.
RESPONSE TO REQUEST NO. 10: A PURPA Energy Sales Agreement
(“ESA”) for Qualifying Facilities (“QF”) that exceed the eligibility cap for published
avoided cost rates is very similar in many respects to an ESA that contains prices based
on the published avoided cost prices. In fact, many conditions found in an agreement
with QFs that exceed the published rate eligibility cap are exactly the same. However,
due to the manner that prices are determined under the incremental cost Integrated
Resource Plan (“ICIRP”) avoided cost methodology there are key terms and provisions
that must be included. Because the pricing contained in an ICIRP based ESA is
determined by the QF’s specific hourly generation profile, the generation profile is
included as an appendix to the ESA. If the QF’s actual energy deliveries are not
consistent with the generation profile that served as the basis for calculating the QF’s
avoided cost prices, contractual mechanisms are in place to protect customers.
Included in an ICIRP based ESA is a pricing adjustment mechanism that is designed to
adjust contract prices if a QF’s generation deliveries vary from the generation profile
used to establish the prices. The pricing adjustment mechanism requires a certain
amount of defined terms and other provisions to properly adjust net energy amounts
and calculate an adjusted price if it is implemented.
IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
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Similar to “standard” ESAs as described in Idaho Power’s response to Staff’s
Request No. 9, each ICIRP-based ESA is submitted to the Idaho Public Utilities
Commission (“Commission”) for its independent review and approval or rejection of the
ESA. Technically speaking, all terms and conditions are subject to negotiation, but
based on whether the Commission has previously approved certain terms and
conditions or has issued orders to include specific contractual provisions there is very
little negotiation that occurs. A contract template for an ICIRP based ESA is attached.
The response to this Request is sponsored by Michael Darrington, Energy
Contracts Leader, Idaho Power Company.

IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
PRODUCTION REQUEST OF THE COMMISSION STAFF - 9
REQUEST NO. 11: Other than the rates and the contract term, what are
common differences between ESAs for projects above the applicable project
eligibility cap and projects below the applicable project eligibility cap?
RESPONSE TO REQUEST NO. 11: As described in Idaho Power’s response to
Staff’s Request No. 10, the primary difference between PURPA energy sales
agreements (“ESA”) for projects above the applicable project eligibility cap and projects
below the applicable project eligibility cap are the terms and conditions that ensure a
Qualifying Facility (“QF”) delivers generation in accordance with the hourly generation
profile that was provided by the QF and serves as the basis of the avoided cost prices
contained in the ESA. Because the incremental cost Integrated Resource Plan (“ICIRP”)
avoided cost methodology relies on an hourly generation profile provided by a QF to
calculate the applicable avoided cost, Idaho Power developed a pricing adjustment
mechanism that requires the QF under contract to deliver generation consistent with its
provided generation profile. Deviations of actual generation from the QF’s submitted
generation profile may result in the need to adjust the prices within the ESA. The
purpose of the pricing adjustment mechanism, and the inclusion of terms and conditions
to implement this provision, is necessary to prevent the submission from a QF of a
generation profile that the project is unable to match with its actual deliveries.
The response to this Request is sponsored by Michael Darrington, Energy
Contracts Leader, Idaho Power Company.

IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
PRODUCTION REQUEST OF THE COMMISSION STAFF - 10
REQUEST NO. 12: Where and how can a QF developer locate a standard
ESA?
RESPONSE TO REQUEST NO. 12: As described in Idaho Power’s response to
Staff’s Request No. 9, the Idaho Public Utilities Commission (“Commission”) has never
established a pro forma template or required a standard form energy sales agreement
(“ESA”) for PURPA Qualifying Facilities (“QF”). Since becoming effective January 1,
2015, Idaho Power’s tariff Schedule 73 has been the Commission approved process for
obtaining an ESA with the Company. Schedule 73 describes the specific procedures
and information required for a QF to submit an application and request an ESA from the
Company. Schedule 73 states under 1. Procedures (e),
“If the Customer desires to proceed with contracting the Qualifying Facility
with the Company after reviewing the indicative pricing proposal, it shall
request in writing that the Company prepare a draft ESA to serve as the basis
for negotiations between the parties. In connection with such request, the
Customer shall provide the Company with any additional Qualifying Facility
information that the Company reasonably determines necessary for the
preparation of a draft ESA…”

Because every ESA with a QF is individually submitted to the Commission for its
independent review and approval or rejection, and is publicly available on the
Commission’s website, a common practice is for a QF developer to become familiar
with Idaho PURPA ESAs and their terms and conditions that have become
“standardized”. In fact, in some instances QF developers have attempted to create their
own contracts based on publicly filed agreements and signed and submitted the
document to Idaho Power seeking to obligate the Company to the ineffective ESA.
Regardless of the various ways that QF developers seek an ESA, PURPA ESAs in
IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
PRODUCTION REQUEST OF THE COMMISSION STAFF - 11
Idaho are readily available for QF developers to read and understand, and Schedule 73
has improved the process for a QF developer to officially request an ESA.
The response to this Request is sponsored by Michael Darrington, Energy
Contracts Leader, Idaho Power Company.

IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
PRODUCTION REQUEST OF THE COMMISSION STAFF - 12
REQUEST NO. 13: 18 C.F.R § 292.302 requires electric utilities such as
Idaho Power to provide to their state commissions such as the Idaho Public Utilities
Commission, and maintain for public inspection, the data from which avoided costs
may be derived and the estimated avoided cost on the electric utility's system "on a
cents per kilowatt-hour basis, during daily and seasonal peak and off-peak periods,
by year, for the current calendar year and each of the next 5 years[.]" 18 C.F.R. §
292.302 also requires the electric utility to file its plan for the addition of capacity
and the estimated capacity costs and planned capacity firm purchases for the next
10 years. In what format does the Company file this with the Commission and where
does the Company make this information publicly available? Please describe how
the Company complies with this provision.
RESPONSE TO REQUEST NO. 13: In Idaho, the Idaho Public Utilities
Commission (“Commission”) Staff keeps, runs, and maintains the Surrogate Avoided
Resource (“SAR”) model used to calculate published avoided cost rates available to
PURPA Qualifying Facilities (“QF”). The SAR model, its inputs, calculations and the
resulting prices are managed by the Commission Staff and it is publicly available at the
Commission. The SAR model is usually updated annually in a public filing at the
Commission and any interested party can file comments related to the model, the most
recent update occurring in Case No. GNR-E-20-01.
The Commission-approved incremental cost Integrated Resource Plan (“ICIRP”)
avoided cost methodology uses inputs from the Company’s most recent Commission-
acknowledged Integrated Resource Plan (“IRP”). The IRP is the Commission-approved
planning process for determining the Company’s future resource needs over the next 20
IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
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years, including capacity resources, and is publicly filed with the Commission upon
completion of the IRP process. The IRP is also available on the Idaho Power website.
The response to this Request is sponsored by Michael Darrington, Energy
Contracts Leader, Idaho Power Company.

IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
PRODUCTION REQUEST OF THE COMMISSION STAFF - 14
REQUEST NO. 14: Please describe how the model used to calculate IRP-
based rates values energy produced by a QF based on the time of day the energy is
produced. Please describe how the model used to calculate SAR-based rates values
energy produced by a QF based on the time of day the energy is produced.
RESPONSE TO REQUEST NO. 14: The incremental cost Integrated Resource
Plan (“ICIRP”) avoided cost methodology values energy produced by a PURPA
Qualifying Facility (“QF”) for each hour the project is expected to deliver generation. The
ICIRP methodology utilizes the AURORA power supply model to determine the hourly
generation resources to meet load based on the Company’s most recently Commission-
acknowledged Integrated Resource Plan (“IRP”). When a QF’s energy is priced using
the ICIRP methodology, the QF’s hourly generation profile is compared with the
resources operating on the system as modeled by AURORA, and the methodology
assigns the highest displaceable resource cost (the avoided cost) to the QF during the
hour and in accordance with the amount of energy the QF is expected to generate
during each hour. The heavy load hour and light load hour avoided costs are then
averaged for each month resulting in a monthly heavy load and light load price.
As described in Idaho Power’s response to Staff’s Request No. 13, the Idaho
Public Utilities Commission (“Commission”) Staff keeps, operates and maintains the
Surrogate Avoided Resource (“SAR”) model used to calculate published avoided costs.
It is Idaho Power’s understanding that the SAR model does not value energy produced
by a Qualifying Facility (“QF”) based on the time of day the energy is produced, but
uniformly assigns the avoided cost of a combined cycle combustion turbine natural gas
facility.
IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
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The response to this Request is sponsored by Michael Darrington, Energy
Contracts Leader, Idaho Power Company.

IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
PRODUCTION REQUEST OF THE COMMISSION STAFF - 16
REQUEST NO. 16: If the ICIRP model is run for the first two years of a new
contract, how many hours of these two years and what percentage of the time is
Langley Gulch CCCT plant used as the marginal resource?
UPDATED RESPONSE TO REQUEST NO. 16: To determine when Langley is
the marginal (i.e. displaceable) resource within the ICIRP model, Idaho Power analyzed
a new solar resource for a two-year period (2019-2020). During that two-year period,
Langley Gulch CCCT was used as the marginal resource within the model for 1,632
hours or 9.3 percent of the total hours. At Staff’s request, Idaho Power prepared a
similar analysis using a resource with a flat generation profile rather than a solar
resource profile. Using that profile, during the two-year period, Langley Gulch CCCT
was used as the marginal resource within the model for 2,901 hours or 16.8 percent of
the total hours.
The response to this Request is sponsored by Scott Wright, Lead Planning
Analyst, Idaho Power Company.

IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
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REQUEST NO. 19: Please provide the model used to determine
incremental cost IRP-based avoided cost rates.
UPDATED RESPONSE TO REQUEST NO. 19: The incremental cost Integrated
Resource Plan (“ICIRP”) avoided cost methodology is a multi-step process used to
determine the avoided cost that is specific to a PURPA Qualifying Facility’s (“QF”) own
hourly generation profile. In order to perform the calculations and procedures to
determine an avoided cost through the ICIRP methodology, a licensed AURORA power
supply model must be used based on inputs from the most recently acknowledged
Integrated Resource Plan (“IRP”).
The ICIRP methodology establishes both a monthly energy price component and
a capacity price component for every hour of the contract term. These hourly values
are calculated based upon the expected ability of the PURPA QF project to displace the
use of Idaho Power generation units and to delay additions of new generation capacity.
The hourly values are mathematically combined to create a monthly heavy load (“HL”)
and light load (“LL”) total price that is applied to the respective PURPA QF energy
deliveries in HL hours (16 hours per day excluding Sunday and North American Electric
Reliability Corporation (“NERC”) Holidays) and LL hours (8 hours per day including all
hours on Sunday and NERC Holidays).
Once a QF project submits complete information in accordance with Idaho
Power’s (“Company”) tariff Schedule 73 and is placed into the energy sales agreement
(“ESA”) queue, an AURORA analysis is performed using the most recently
acknowledged IRP data (e.g. operational constraints, natural gas, energy and load
forecasts, etc.) plus any prior additional queued QF projects to determine the generation
IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
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resources being used to meet the expected hourly energy loads for each hour of the
contract term. The generation resources are economically dispatched based upon the
incremental cost of each resource. This information is then processed through a pricing
model that identifies for every hour of the proposed contract term the incremental
cost(s) (highest incremental cost resources being displaced first) of each displaceable
generation resource for each hour that the proposed PURPA QF project is displacing.
These hourly prices are then multiplied by the estimated PURPA QF energy deliveries
in each hour, summed together into HL and LL total energy costs for each month, then
divided by the total HL and LL energy deliveries for each respective month creating a
monthly HL and LL avoided cost of energy.
Displaceable resources have been identified as being a resource that is on-line
and capable of staying on-line and reducing its output. Potential displaceable resources
include: 1) Company-owned thermal resources (Bridger, Boardman, Valmy, Langley
Gulch, and the gas-fired peakers) that are on-line and operating at or above their
minimum load level, (2) long-term firm purchases, and (3) market purchases as
determined by AURORA. If a long-term firm purchase or market purchase is
determined to be the displaceable resources in a given hour, the incremental cost is set
to be the market clearing price as determined by the AURORA model on an hour-to-
hour basis.
The cost of a simple cycle combustion turbine (“SCCT”) natural gas unit is
allocated to each unique PURPA QF generation project based upon the project’s
nameplate rating and the expected ability to be available when Idaho Power is
experiencing peak energy demand. This capacity value is then converted to a per-
IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
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kilowatt-hour (“kWh”) value and paid to the project for each kWh the project delivers to
Idaho Power for all months after Idaho Power’s capacity deficiency period has occurred.
As discussed with Commission Staff on conference calls held on June 30, 2020,
and July 10, 2020, the base AURORA setup files (energy component) for the 2017 IRP
are found on the Company’s FTP site. Additionally, Attachment 1 to this Response
provides a summary of Idaho Power’s ICIRP-methodology process, and Attachment 2
shows how capacity value would be calculated for a generic solar project under the
ICIRP methodology. Please contact Mark Annis, Senior Regulatory Analyst, at (208)
340-0404 or [e-mail] for access to the FTP site.
The response to this Request is sponsored by Michael Darrington, Energy
Contracts Leader, Idaho Power Company.

IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
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REQUEST NO. 22: Please describe any differences between contracts that
fall under the eligibility cap and those that are over the eligibility cap within the
Company's Schedule 73 Contracting Procedures. Please include differences in
information requirements including the amount, resolution, and importance of specific
information provided by a developer, and the amount of resources in staff-hours
required by the Company to process each step.
RESPONSE TO REQUEST NO. 22: The incremental cost Integrated Resource
Plan (“ICIRP”) avoided cost methodology values energy produced by a PURPA
Qualifying Facility (“QF”) for each hour the project is expected to deliver generation. The
ICIRP methodology utilizes the AURORA power supply model to determine the hourly
generation resources to meet load based on the Company’s most recently Commission-
acknowledged Integrated Resource Plan (“IRP”). When a QF’s energy is priced using
the ICIRP methodology, the QF’s hourly generation profile is compared with the
resources operating on the system as modeled by AURORA, and the methodology
assigns the highest displaceable resource cost (the avoided cost) to the QF during the
hour and in accordance with the amount of energy the QF is expected to generate
during each hour. The heavy load hour and light load hour avoided costs are then
averaged for each month resulting in a monthly heavy load and light load price.
As described in Idaho Power’s response to Staff’s Request No. 13, the Idaho
Public Utilities Commission (“Commission”) Staff keeps, operates and maintains the
Surrogate Avoided Resource (“SAR”) model used to calculate published avoided costs.
It is Idaho Power’s understanding that the SAR model does not value energy produced
by a Qualifying Facility (“QF”) based on the time of day the energy is produced, but
IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
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uniformly assigns the avoided cost of a combined cycle combustion turbine natural gas
facility.
The response to this Request is sponsored by Michael Darrington, Energy
Contracts Leader, Idaho Power Company.

IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
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REQUEST NO. 24: Please describe any differences and similarities between
the output characteristics of a battery QF and the output characteristics of each of the
resources listed in the "other" category of 20-year published rates (ie. Biomass,
Biogas, Landfill Gas, Geothermal, Waste-to-Energy, Non-fossil Fueled Cogen). For
any differences, please indicate how it might change the calculation of the avoided
energy and/or capacity cost over the 20-year contract period.
RESPONSE TO REQUEST NO. 24: A battery storage facility by and of itself is
not a generation resource but is a system capable of storing electricity generated by
another resource and discharging the stored electricity on a controlled, but time
constrained basis; whereas the resources currently included in the “other” category
eligible for published avoided cost rates, i.e., biomass, cogeneration, geothermal, landfill
gas to energy, etc., are generation resources that are fueled and capable of continuous
generation output. The technical and operational aspects of a battery storage facility are
completely dependent on how the batteries are charged and discharged, which are
limited by time constraints specific to the purposes that the batteries are intended to
serve. Because batteries store electricity and are not fueled, if a battery storage facility
is providing continuous generation output, it is not a result of the battery charging or
discharging but is a product of the generation resource used to provide electricity to the
batteries. In this instance, or in a “hybrid” system, consisting of a battery storage facility
that is charged by a generation resource such as wind or solar, the battery can be used
to reshape the associated generation resource output profile as opposed to a stand-
alone battery storage facility that can only be charged or discharged.
IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
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Regardless of the differences between a battery storage facility and a QF in the
“other” category, the incremental cost Integrated Resource Plan (“ICIRP”) avoided cost
methodology is the only Idaho Public Utilities Commission approved methodology
capable of taking the proper and valid hourly generation profile of a PURPA Qualifying
Facility (“QF”) and allocating an incremental “avoided” cost of the generation based on
Idaho Power’s electrical system. The key to determining an accurate avoided cost using
the ICIRP methodology is to ensure that the generation provided by a QF during a given
hour is not double counted, or included as generation from both the generation resource
used to charge the batteries and discharged output from the batteries as described in
Idaho Power’s responses to Staff’s First Production Request to Idaho Power.
The response to this Request is sponsored by Michael Darrington, Energy
Contracts Leader, Idaho Power Company.

DATED at Boise, Idaho, this 14th day of July 2020.

DONOVAN E. WALKER
Attorney for Idaho Power Company
IDAHO POWER COMPANY’S RESPONSE TO THE SECOND
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CERTIFICATE OF SERVICE

I HEREBY CERTIFY that on this 14th day of July 2020 I served a true and correct
copy of IDAHO POWER COMPANY’S RESPONSE TO THE SECOND PRODUCTION
REQUEST OF THE COMMISSION STAFF upon the following named parties by the
method indicated below, and addressed to the following:

Commission Staff
Edward Jewell
Deputy Attorney General
Idaho Public Utilities Commission
11331 W. Chinden Boulevard
Building 8, Suite 201-A
Boise, Idaho 83714

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Christy Davenport, Legal Assistant