20130617_4080.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER REDFORD
COMMISSIONER SMITH
COMMISSION SECRETARY
COMMISSION STAFF
FROM:CATHLEEN MCHUGH
DATE:JUNEI1,2013
SUBJECT:CASE NO.IPC-E-06-34 (IDAHO POWER)
INCLUSION OF OMITTED PRICING INFORMATION IN THE HOT
SPRINGS \VINDFARM FIRM ENERGY SALES AGREEMENT
On May 14,2013,Idaho Power Company (Idaho Power;Company)submitted for
Commission approval an Application to include additional pricing information to the
December 20,2006,Firm Energy Sales Agreement (Agreement)between Idaho Power and Hot
Springs Windfarm,LLC (Hot Springs).The original Agreement is for a 20-year term and was
approved on February 20,2007,in Order No.30246.The First Amendment was approved on
August 8,2007,in Order No.30398.
BACKGROUND
In the original Agreement,Hot Springs selected December31,2007 as the estimated
scheduled operation date for the Hot Springs Windfarm Project (Project).The pricing schedule
contained in that Agreement extended 20 years from that date (through 2027).In the First
Amendment.Hot Springs and Idaho Power agreed to amend the original Agreement to extend the
scheduled operation date for a period olapproximately one year.However,at that time,the
pricing schedule in the Agreement was not updated to reflect the new scheduled operation date.
In April 2013,Hot Springs notified Idaho Power that the 20-year pricing schedule did not
extend for the full term of the Agreement.The pricing contained in the Agreement is based upon
the standard published avoided cost rates in effect at the time the Agreement was executed and in
accordance with Order No.29646.On May 3,2013,Idaho Power provided Hot Springs with a
letter setting forth the pricing to be applied to the last 12 months of the term of the Agreement
DECISIONMEMORANDUM I JUNEII,2013
based upon the standard published avoided cost rates in effect at the time.Commission Staff
advised Idaho Power to provide confirmation that Hot Springs concurred with the additional
pricing information.On May 31,2013,Idaho Power submitted a letter executed by Hot Springs
that expressed agreement with the pricing schedule.
STAFF REVIEW
Staff has verified that the prices provided by Idaho Power to Hot Springs are based
upon the standard published avoided cost rates in effect at the time and in accordance with Order
No.29646.Both Idaho Power and Hot Springs agree to these prices.
STAFF RECOMMENDATION
Staff recommends that the Commission approve the inclusion of these additional prices
into the terms of the Agreement.
COMMISSION DECISION
Does the Commission wish to approve the inclusion of pricing information so that the
pricing schedule extends through the full term of the Agreement?
Cathleen McHugh
udmemos/liol sprns (2)doc
DECISION MEMORANDUM 2 JUNE 11,2013