20181214Decision Memo.pdf

DECISION MEMORANDUM
TO COMMISSIONER KIELLANDER
COMMISSIONER RAPER
COMMISSIONER ANDERSON
COMIVIISSION SECRETARY
COMMISSION STAFF
LEGAL
FROM:EDWARD JEWELL
DEPUTY ATTORNEY GENERAL
DATE: DECEMBER 14,2018
SUBJECT:IN THE MATTER OF THE JOINT APPLICATION OF AVISTA AND
CLEARWATER PAPER FOR APPROVAL OF A POWER PURCHASE
AND SALE AGREEMENT; CASE NO. AVU-E-18-13
On November 29, 2018, Avista Corporation ("Avista" or "the Company") filed a
Joint Application seeking approval of a Power Purchase and Sale Agreement ("2018
Agreement") between Avista and the Clearwater Paper Corporation ("Clearwater Paper").
Clearwater Paper owns and operates four thermal electric generating units with a combined total
nameplate capacity of 132.2 MVA. Application at 2. The units are qualifying facilities pursuant
to the Public Utility Regulatory Policies Act of 1978 ("PURPA"). Id.
THE APPLICATION
On January l, 1992, Avista and Clearwater Paper entered into a l0-year Electric
Service and Purchase Agreement, which was approved by Commission Order No. 23858. /d. at
2. On July l, 2003, Avista and Clearwater Paper entered into a l0-year Power Purchase and Sale
Agreement, which was approved by Commission Order No.29418. Id. On July 1, 2013, Avista
and Clearwater Paper entered into an Electric Service Agreement, which was approved by
Commission Order No. 32841. The 2013 Agreement was for a 5-year term, which was extended
to June 30,2021, by Commission Order No. 33350. Id. at 3. Upon the effective date of the 2018
Agreement, the 2013 Agreement will be superseded in its entirety by the 2018 Agreement. Id.
The 2018 Agreement is designed to allow Clearwater Paper to optimize the value of bundled
RECs produced by the Facility. Id. at 4. Under the 2018 Agreement, Avista will file a proposed
DECISION MEMORANDUM 1
Schedule 25P Block 2 PURPA rate of $24.50 per MWh to compensate Clearwater Paper for its
generation. Id. at 6.
STAFF RECOMMENDATION
Staff recommends the Commission issue a Notice of Application and Notice of
Modified Procedure, with comments due forty-five days from service of the Notice and reply
comments due ten days later.
COMMISSION DECISION
Does the Commission wish to issue a Notice of Application and Notice of Modified
Procedure that establishes a forty-five day comment period and a ten day reply period?
>-lrr,*-Ll
Edward JQlvell
Deputy Attorney General
l:\lrgal\ELECTRIC\AVU-E- I8- I3\AVUE I8 1 ,l_dec memo_ej
2DECISION MEMORANDUM