20200128_jh3.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER RAPER
COMMISSIONER ANDERSON
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL
FROM:JOHN R.HAMMOND JR.
DEPUTY ATTORNEY GENERAL
DATE:JANUARY 17,2020
SUBJECT:AVISTA CORPORATION'S APPLICATION FOR APPROVAL OR
REJECTION OF A POWER PURCHASE AGREEMENT WITH STIMSON
LUMBER COMPANY;CASE NO.AVU-E-19-16.
On December 31,2019,A vista Corporation ("Avista"or "Company")filed an
Application seeking approval of a proposed Power Purchase Agreement ("Agreement")with
Stimson Lumber Company ("Stimson"or "Seller")for the energy generated by a thermal wood
waste small power electric generation plant operated by Stimson in Plummer,Idaho ("Facility").
The Facility is a qualifying facility ("QF")under the Public Utility Regulatory Policies Act of
1978 ("PURPA").
THE APPLICATION
The Facility operated by Stimson "is capable of generating up to approximately 6.5
megawatts of energy."Application at 2.The proposed Agreement replaces a prior power purchase
agreement which was approved by the Commission in Order No.30224 on January 19,2007.Id.
The original term of the previous agreement was five years,expiring on September 30,2011.Id.
The previous agreement was amended to extend its term through December 31,2019.Id.The
Company states that if the replacement Agreement is approved by the Commission prior to
February 21,2020,its term will commence on January 1,2020,and will extend for a term of one
year following the effective date.Id.To allow for the continuous operation of the Facility,the
Agreement allows Stimson to deliver energy from the Facility to vista and for Avista to pay
Stimson for such energy deliveries,effective January 1,2020.Id.at 3.In the event the
Commission does not approve the Agreement by February 21,2020,or approves it subject to
DECISION MEMORANDUM l
conditions unacceptable to the parties,the Agreement will terminate.In such event,Stimson shall
refund certain amounts to Avista pursuant to Section 5.4 of the Agreement.Id.
STAFF RECOMMENDATION
Section 5.3 of the proposed Agreement provides that if the Commission does not
approve it by February 21,2020,neither party shall have any further obligations to purchase or
sell electric power under its terms and the Agreement shall terminate.Further,this Agreement
will replace a previous agreement that the Commission has reviewed and approved previously.
Due to the foregoing contractual provision and Staff's and the Commission's likely familiarity
with the parties and the subject matter of the proposed Agreement,Staff recommends that the
Commission establish shortened written comment periods.Accordingly,Staff recommends that
itself and any interested party file written comments by no later than February 7,2020.Further,
Staff recommends that the Commission set the reply comment deadline for February 14,2020.
COMMISSION DECISION
Does the Commission wish to issue a Notice of Application and Notice of Modified
Procedure that establishes a February 7,2020 written comment deadline for Staff and any other
interested parties followed by a February 14,2020,reply comment deadline for the Company?
Jo .Hammond Jr.
e ty AttorneyGeneral
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DECISION MEMORANDUM 2