20180214Comments.pdf

CAMILLE CHRISTEN
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSTON
PO BOX 83720
BOISE, IDAHO 83720.0074
(208) 334-03t4
BARNO. 10177
IN THE MATTER OF THE JOINT
APPLICATION OF AVISTA CORPORATION
AND CLARK FORK HYDRO LLC FOR
APPROVAL OF A POWER PURCHASE
AGREEMENT
RECEIVED
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Street Address for Express Mail:
472W. WASHINGTON
BOISE, IDAHO 83702-5918
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
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CASE NO. AVU.E.18.O1
COMMENTS OF THE
COMMISSION STAFF
COMES NOW the Staff of the Idaho Public Utilities Commission, by and through its
attorney of record, Camille Christen, Deputy Attorney General, and in response to the Notice of
Application and Notice of Modified Procedure issued in Order No. 33972 on January 24,2018,
in Case No. AVU-E-I8-01, submits the following comments.
BACKGROUND
On January 9,2018, Avista Corporation dba Avista Utilities and Clark Fork Hydro LLC
(collectively, o'the Parties") jointly applied to the Commission for an order approving their Power
Purchase Agreement (PPA), with a requested effective date of January l, 2018. Application at 1.
The Commission issued a Notice of Applicationl and Notice of Modified Procedure setting
comment and reply deadlines. Order No. 33972.
The Parties explain that Clark Fork is the developer of the Derr Creek Hydroelectric
Project, a250 kilowatt (kW) "qualifying facility" (QF) under the Public Utility Regulatory
rThe Parties styled their filing as a "petition," and the Commission indicated it would treat it as an Application,
OrderNo.33972.
STAFF COMMENTS I FEBRUARY I4,2OI8
Policies Act (PURPA). Application at 2. Under the PPA, Avista will buy the QF's output at the
applicable non-levelized rates for non-seasonal hydro projects smaller than 10 average
megawatts. Id. at 3. The PPA has a2}-year term. See id. at 4.
According to the PPA, the Parties had a prior agreement under which Avista purchased
the output from the QF, which expired by its own terms on December 3 1, 2017 . PPA at 3. The
Parties entered into the proposed PPA so Avista could continue to purchase the output from the
QF. Id
On January 25,2018, the Parties submitted an amendment to section 5.3 of the proposed
PPA. That section originally stated that if the Commission failed to issue a final order approving
the PPA by January 30,2018, neither Party shall have any further obligations to purchase or sell
power, and the PPA would terminate. With the amendment agreed to by the Parties, section 5.3
now states that if the Commission fails to issue a final order approving the PPA by February 28,
2018, neither Party shall have any funher obligations to purchase or sell power, and the PPA
shall terminate. See AmendmentNo. I to PPA.
STAFF REVIEW
Staff has reviewed the proposed rates and conhrms they are correct. All other terms and
conditions contained in the proposed Agreement are consistent with prior Commission orders.
Because the Company is seeking approval of the new PPA after the expiration of the prior
contract, Staffls understanding is that the Company will retroactively pay the QF for the output
of the facility at the rates contained in the Agreement from January 1,2018 moving forward if
the Agreement is approved by the Commission.
STAFF RECOMMENDATIONS
Staff recommends that the Commission approve all of the Agreement's terms and
conditions and declare that all payments made by Avista to Clark Fork Hydro for purchase of
energy will be allowed as prudently incurred expenses for ratemaking purposes.
2STAFF COMMENTS FEBRUARY 14,2018
Respectfully submitted this \\rv-
day of February 2018
Christen
Deputy Attorney General
Technical Staff: Rachelle Farnsworth
Yao Yin
i:umisc/comments/avue18. lccrfuy comments
JSTAFF COMMENTS FEBRUARY 14,20I8
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS I4TH DAY OF FEBRUARY 2018,
SERVED THE FOREGOING COMMENTS OF THE COMMISSION STAFF, IN
CASE NO. AVU-E-18-01, BY MAILING A COPY THEREOF, POSTAGE PREPAID,
TO THE FOLLOWING:
STEVE SLIKWORTH
MGR WHOLESALE MARKETING
AVISTA CORPORATION
PO BOX 3727
SPOKANE W A 99220-3727
E-mail: [e-mail]
JAY WHITE
OPERATIONS MANAGER
CLARK FORK HYDRO LLC
PO BOX 528
CLARK FORK ID 8381 I
E-mail: [e-mail]
MICHAEL G ANDREA
SENIOR COUNSEL
AVISTA CORPORATION
PO BOX3727
SPOKANE WA99220-3727
E-mail: [e-mail]
DENNIS M DAVIS
WITHERSPOON KELLEY
608 NORTHWEST BLVD
STE 3OO
COEUR D'ALENE ID 83814
E-mail : [e-mail]
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SECRETAR.Y
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CERTIFICATE OF SERVICE