20210831Comments.pdf

ERICK SHANER
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
IDAHO BAR NO. 5214
IN THE MATTER OF AVISTA
CORPORATION'S AND STIMSON LUMBER
COMPANY'S JOINT PETITION FOR
APPROVAL OF AMENDMENT NO. 2TO
THEIR POWER PURCHASE AND SALE
AGREEMENT
Street Address for Express Mail:
I 1331 W CHINDEN BLVD, BLDG 8, SUITE 2OI-A
BOISE, ID 8371,4
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
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CASE NO. AVU-E-21.07
COMMENTS OF THE
COMMISSION STAFF
STAFF OF the Idaho Public Utilities Commission, by and through its attomey of record,
Erick Shaner, Deputy Attorney General, submits the following comments:
BACKGROUND
On July 13,2021, Avista Corporation ("Avista") and Stimson Lumber Company
("Stimson") filed a Joint Petition ("Application") seeking approval of Amendment No. 2 to their
Power Purchase and Sale Agreement ("Agreement").
Amendment No. 2 extends the term of the original Agreement through December 31,
2023, and updates the Agreement to apply the current published avoided cost rates to all power
purchases by Avista under the Agreement during the period from January 1,2022 through
December 31,2023.
The Agreement as amended by Amendment No. I was approved by the Commission in
Order No. 34692 issued on June 15,2020. The original Term of the Agreement was due to
ISTAFF COMMENTS AUGUST 3I,2O2I
expire on December 31, 2021. The Amendment replaces Section 5.5 of the Agreement to extend
the term as follows: The term of the Agreement shall commence on the Effective Date and shall
continue through December 31,2023, unless terminated earlier by the terms and conditions
contained herein.
Amendment No. 2 replaces Exhibit E to the Agreement to update the avoided cost rates
that will apply during the Extension Period. Except as expressly amended, all other terms of the
Agreement remain in full force and effect for the Extension Period.
STAFF ANALYSIS
Because all provisions in the original Agreement, except for the published avoided cost
rates, are still in compliance with the latest Commission Orders, Staff s review has focused on
the eligibility of immediate capacity payment and the verification of avoided cost rates.
Eligibility of Immediate Capacitv Payment
Stimson was paid for capacity at the end of the original contract term, and according to
Commission Order No. 32697, a QF only receives compensation for capacity when the utility is
capacity deficient, unless it is a renewal/extension project that was paid for capacity at the end of
the original contract. In addition, the project has maintained continuous operation since the
current contract term began. Therefore, Staff agrees with the Amendment No.2 that the
proposed published avoided cost rates should include immediate capacity payments.
Verification of Cost Rates
Staff reviewed the avoided cost rates proposed in the Amendment No.2 and verified that
the proposed rates are correct.
STAFF RECOMMENDATION
Staff recommends that the Commission approve Amendment No. 2, with all other terms
of the Agreement remaining in full force and effect for the Extension Period.
2STAFF COMMENTS AUGUST 3I,2O2I
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rs{5l -auy of August 2021.Respectfully submitted this
Technical Staff: Yao Yin
i:umisc:comments/avue2 l.Tesyy comments
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Erick Shaner
Deputy Attorney General
JSTAFF COMMENTS AUGUST 3I,2O2I
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 31ST DAY OF AUGUST 2021,
SERVED THE FOREGOING COMMENTS OF TIIE COMMISSION STAX'F, IN
CASE NO. AVU-E-21.07, BY MAILING A COPY THEREOF, POSTAGE PREPAID,
TO THE FOLLOWING:
CHRIS DRAKE
AVISTA CORPORATION
POBO)(3727
SPoKANE WA99220-3727
E-MAIL : [e-mail]
LISA ZENTHER
STIMSON LUMBER CO
520 S YAMHILL STE 7OO
POTLAND OK972O4
E-MAIL: [e-mail]
MICHAEL G ANDREA
AVISTA CORPORATION
PO BOX3727
SPoKANE WA99220-3727
E-MAIL : michael.andrea@avistacoerp. com
CERTIFICATE OF SERVICE