20220510Reply Comments.pdf

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Avista Corp.
1411 East Mission, P.O.Box3727
Spokane, Washington 99220-0500
Telephone [phone]
Toll Free 800-727-9170
Jan Noriyuki, Secretary
Idaho Public Utilities Commission
11331 W. ChindenBlvd
Building 8, Suite 201-A
Boise,lD 83714
RE: Avista - Reply Comments
Dear Ms. Noriyuki:
Enclosed for filing with the Commission is an electronic copy of Avista's Reply Comments in
response to Comments of Commission Staff recommending approval of an amended agreeme,nt
that includes certain changes to the Power Purchase Agreement Between Avista Corporation and
the Regents of the University of Idaho.
Please direct any questions regarding this report to Michael Andrea at [phone] or myself
at509-495-4584.
Sincerely,
/s/Paul Kimball
Paul Kimball
Manager of Compliance & Discovery
Avista Utilities
509-495-4584
paul. kimball @avistacorp. com
Enclosure
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MICHAEL G. ANDREA (ISB No. 8308)
Avista Corporation
14ll E. Mission Ave., MSC-17
Spokane, WA99202
Telephone: [phone]
michael. andrea@avistacorp. com
TN THE MATTER OF AVISTA AND THE
UNTVERSITY OF IDAHO'S JOINT
PETITION FOR APPROVAL OF A POWER
PURCHASE AGREEMENT (STEAM
FACILITY)
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
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CASE NO. AVE.E,-22-03
REPLY COMMENTS OF AVISTA
CORPORATION
Pursuant to the Notice issued by the Idaho Public Utilities Commission ("Commission")
on March 25,2022 in the above-captioned proceeding, Avista Corporation ("Avista")
respectfully submits the following reply comments in response to Comments of Commission
Staffrecommending approval of an amended agreement that includes certain changes to the
Power Purchase Agreement Between Avista Corporation and the Regents of the University of
Idatro ("University") that was filed in this proceeding on February 23,2022 ("Original
Agreement"). Avista appreciates Staff s comments and agrees with the changes to the Original
Agreement recommended by Staff. Accordingly, Avista submits a First Amended and Restated
Power Purchase Agreement between Avista and the University of Idaho ("First Amended
Agreement").1 The University has authorized Avista to represent that the University agrees to
the proposed changes in First Amended Agreement, as reflected in that agreement. The First
Amended Agreement will supersede and replace the Original Agreement in its entirety. Avista
I The First Amended Agreement is attached hereto as Attachment A. A redline showing the changes to the Original
Agreement is attached hereto as Attachment B for infonnational purposes only.
Page - I REPLY COMMENTS OF AVISTA CORPORATION
respectfully requests that the Commission approve the First Amended Agreement with an
effective date of February 16,2022.
I. Background
Avista and the Regents of the University of Idaho entered into the Original Agreement on
February 16,2022. Pursuant to the Original Agreernent, the University intends to use its steam
facility ("Facility") to serve University load. The parties anticipate that all of the Facility output
will be used to serve University load and, therefore, little or no output from the Facility will
actually be delivered to Avista. To the extent the output from the University's Facility exceeds
the University's load, the University has elected to sell, and Avista will purchase, all such output
from the Facility at the avoided costs calculated at the time of delivery, which shall be, for each
hour in which the University delivers such output to Avista at the Point of Delivery the Market
Energy Price for such hour expressed in $ per kWh multiplied by the total kWh delivered to
Avista at the Point of Delivery for such hour. On February 23,2022, Avista and the University
filed a joint petition requesting that the Commission accept the Original Agreement effective
February 16,2022.
On May 3,2022, Staff submitted comments on the Original Agreement ("Comments").
In its Comments, Staff recommends the following five changes to the Original Agreonent:
1. Remove the option of other mutually agreed-to index in the Agreement;
2. Set avoided cost rates in this Agreement at85o/o of the PowerDex hourly Mid-
Columbia (''Mid-C") index price;
3. Correct the mistaken Nameplate Size in Attachment 2 of Exhibit D;
4. Use 85% of the PowerDex hourly Mid-Columbia ("Mid-C")index price as
avoided cost rates for the potential of a lapsed contract period; and
Page - 2 REPLY COMMENTS OF AVISTA CORPORATION
5. Update Article 2l in the Agreement to ensure any amendment or modification
does not become valid without Commission authorization.
StaffComments at 2.
Staffrecommends approving an amended agreement that includes its recommended changes. Id.
at6.
As discussed herein, Avista agrees with Staffs recommended changes to the Original
Agreement. Avista and the University have executed the First Amended Agreeme,nt, which
incorporates the amendments recommended by Staff, Accordingly, Avista submits the First
Amended Agreement for approval and requests that the Commission accept the First Amended
Agreement effective February 16, 2022.
II. Reply Comments
As discussed above, Commission Staffrecommends five amendments to the Original
Agreement. Avista has revised the Original Agreement to incorporate Staff s recommendations
as more fully discussed below.
A. Removal of the option of other mutually agreed-to index in the Agreement
Staffobjects to language in the definition of Market Energy Price in the Original
Agreement that states that such Market Energy Price is based on the hourly Mid-Columbia index
price, "or other mufually agreed to index.o' Staffstates "if the Parties decide to use another
market price index in the future, they should file an amendment to the Agreement so that index
can be reviewed and approved by the Commission." StaffComments at 3.
The phrase "or other mutually agreed to index'o was included to ensure that the parties
could agree to an index other than the Mid-Columbia index ii for example, the Mid-Columbia
index was not available. Avista does not, however, object to the removal of that phrase.
Page - 3 REPLY COMMENTS OF AVISTA CORPORATION
Accordingly, in the First Amended Agreement, the parties have deleted the phrase o'or other
mutually agreed to index" from the definition of "Market Energy Price."
Set avoided cost rates in this Agreement at85o/o of the PowerDex hourly
Mid-Columbia ("Mid-C") index price
In the Original Agreement, the Market Energy Price was defined as the "hourly Mid-
Columbia ("Mid-C") index price . . . ." In its Comments, Staff stats that "the avoided cost rates
used in this Agreernent for non-firm energy generation should be 85% of the non-firm market
rates. . . ." Staff Comments at 3. Stafftherefore recommends, that "anS1o/o adjustment factor be
applied to the PowerDex hourly Mid-Columbia ("Mid-C") index pice." Id.
Avista agrees with Staffthat an 85 percent adjustment factor should be applied to the
PowerDex hourly Mid-C index price. Accordingly, the definition of "Market Energy Price" in
the First Amended Agreement has been revised so that "Market Energy Price" means:
. . . eighty-five percent (85%) of the PowerDex hourly Mid-Columbia index ("Mid-C
Index") price; provided, however, if the Mid-C Index price is less than zero, the Market
Energy Price shall be one-hundred and fifteen percent (ll5%) of the Mid-C Index price.
First Amended Agreement at Section 1.16.
As revised, the avoided cost rate when the Mid-C index is positive will be 85 percent of
the Mid-C index. To effectuate Staff s recommendation that an 85 percent adjustment factor is
to be applied to the Mid-C index, when the price is negative, the avoided cost rate when the Mid-
C index is negative must be ll5% of the Mid-C index. That is, under the proposed definition of
the Market Energy Price, Avista will be in the same position regardless of whether the Mid-C
index is positive or negative. If, however, the Market Energy Price was 85 percent of the Mid-C
index regardless of whether the Mid-C is positive or negative, Avista would be adversely
impacted when the prices are negative. That is, when the Mid-C index is positive, Avista would
pay less than the Mid-C price for any output and, therefore, after transaction costs be rougNy
Page - 4 REPLY COMMENTS OF AVISTA CORPORATION
B.
whole if it sells such output to the market. In contrast, when the Mid-C index is negative, the QF
would pay Avista less for the output then it would cost Avista to dispose of such output in the
market and, therefore, Avista's customers would have to pay to dispose of such output. To
ensure that Avista is in the same position regardless of whether the Mid-C index is positive or
negative, the adjustment factor when the Mid-C index is negative must be 115 percent.
C. Correct the mistaken Nameplate Size in Attachment 2 of Exhibit D
Staffnotes in its comments that "Attachment No. 2 of Exhibit D states the Facility's
Nameplate Size is 1,050 kW", but the actual nameplate for the Facility is 825 kW. Staff
Comments at 4. Exhibit D to the Original Agreernent is the interconnection agreement for the
Facility. The interconnection agreement is provided as an exhibit to demonstrate that the Facility
has the ability to deliver output to Avista. As long as the nameplate capacity in the
interconnection agreement is at least as large as the nameplate capacity in the power purchase
agreement, the stated nameplate capacity in the interconnection agreement is of no consequence
to the power purchase agreement.
In this instance, the applicable nameplate rating for the Facility is, as Staffcorrectly
notes, 825 kW. The interconnection agreement provides a nameplate size of 1,050 kW, which is
sufficient to allow the Facility to deliver the full 825 kW to Avista. Accordingly, Avista has
revised the cover sheet for Exhibit D to expressly stated that, "[flor purposes of this Amended
and Restated Power Purchase Agreement, the Parties agree that the Nameplate Capacity Rating
of the Facility is 825 kW Alternating Current (AC), as more fully described in Exhibit A." First
Amended Agreement at Exhibit D.
D. Use 857o of the PowerDex hourly Mid-Columbia ("Mid-C")index price as
avoided cost rates for the potential ofa lapsed contract period
Page - 5 REPLY COMMENTS OF AVISTA CORPORATION
Staffnoted that, because the parties requested a February 16,2022 effective date, there is
the potential for retroactive rates from February 16,2022 throtgh the date of a Commission
order. Staffstates that, if the final approved effective date results in a lapsed contract
period, it "recommends that the Parties use 85% of the PowerDex hourlyMid-Columbia ("Mid-
C") index price for the energy delivered during the lapsed contract period." StaffComments at
5. To effectuate Staff s recommendation, the following has been added to Section 5.2 of the
First Amended Agreement:
For the avoidance of doubt, the rate to be paid to Seller for any Net Output Seller delivers
to Avista at the Point of Delivery from the Effective Date through the date that the
Commission issues an order (the "Lapse Period") shall be the Market Energy Price. To
the extent that Avista has paid Seller a price other than the Market Energy Price for any
Net Output delivered to Avista, Avista shall issue an invoice or payment to Seller within
30 days of the Commission's order approving this Agreement to correct any over or
under payment.
First Amended Agreement at Section 5.2
To date, the University has not delivered any output from the Facility to Avista.
Accordingly, Avista does not anticipate that any payment will be made for output prior to
Commission approval of the First Amended Agreement. If, however, the output from the
Facility is delivered to Avista during the Lapse Period, the avoided cost rate will be 85 percent of
the Mid-C index, as recornmended by Staff.
E. Update Article 21 in the Agreement to ensure any amendment or
modification does not become valid without Commission authorization
In its Comments, Staffexpressed concern that Article 2l of the Original Agreernent
contemplated amendments may become effective without Commission approval. The intent of
Article 21 is to state that both parties to the agreement must agree in writing to amend the
agreement. However, any amendment must be approved by the Commission. Accordingly, in
the First Amended Agreement Article 21 has been revised to expressly state:
Page - 6 REPLY COMMENTS OF AVISTA CORPORATION
No change, amendment or modification of any provision of this Agreement shall be valid
unless set forth in a written amendment to this Agreement signed by both Parties and
aoproved blt the Commission.
First Amended Agreement at Article 2l (emphasis added to show revision).
IIL Conclusion
Avista appreciates Staffs careful review of the Original Agreement. As discussed
herein, the Original Agreement has been revised to incorporate Staff s recommended
amendments. Accordingly, Avista respectfully requests that the Commission approve the First
Amended Agreement (attached hereto as Attachment A) with an effective date of February 16,
2022.
DATED this lOth day of May 2022
Michael G. Andrea
Attorney for Avista Corporation
Page - 7 REPLY COMMENTS OF AVISTA CORPORATION
FIRST AMENDED AND RESTATED
POWER PURCHASE AGREEMENT
BETWEEN
REGENTS OF THE UNIVERSITY OF IDAHO
AND
AVISTA CORPORATION
POWER PURCHASE AGREf,MENT (STEAM)
This First Amended and Restated Power Purchase Agreement ("Agreement") is made by
and between Avista Corporation, a Washington corporation ("Avista"), and the Regents of the
University of Idaho ("Seller"). Avista and Seller are sometimes refened to individually as a
"Party" and collectively as the "Parties."
RECITALS
WHEREAS, the Parties entered into a Power Purchase Agreement ("Original Agreement")
that was submiued to the Idaho Public Utilities Commission for approval on February 23,2022;
WHEREAS, Commission Staffrecommended certain revisions to the Original Agreement;
WHEREAS, the Parties enter into this Agreement to amend the Original Agreement
consistent with Commission Staffs recommendation and intend this Agreement to supersede and
replace the Original Agreement in its entirety;
WHEREAS, Seller will own, operate and maintain the electric power generating facility
with a Nameplate Capacity Rating of 825 kW Alternating Current (AC), as more fully described
in Exhibit A ("Facility");
WHEREAS, Seller will operate the Facility as a Qualiffing Facility, as defined by the
Public Utility Regulatory Policies Act of 1978 ("PURPA");
WHEREAS, Seller will use the Facility to serye Seller's Load (as defined herein); and
WHEREAS, to the extent the output generated from the Facility exceeds Seller's Load,
Seller will deliver and sell to Avista on an as-available basis, and Avista will purchase, output
generated from the Facility subject to the terms of this Agreement.
PAge - I - FIRST AMENDED AND RESTATED UNTVERSITY OF IDAHO POWER
PURCHASE AGREEMENT (STEAM)
NOW, THEREFORE, in consideration of the mutual agreements set forth herein. the
Parties agree as follows.
I. DEFINITIONS
Except as otherwise defined in this Agreement, whenever used in this Agreement and
exhibits hereto, the following terms shall have the following meanings:
l.l "AgIEIqg$" means this First Amend and Restated Power Purchase Agreement,
including all exhibits, and any written amendments.
l.2..@''shallhavethemeaningprovidedinSection5.2ofthis
Agreement.
1.3 "aM!V" means average megawatt(s). An average megawatt is calculated by
dividing the total generation in MWh over a given period of time (e.9., a calendar month) by the
number of hours in that period of time.
1.4 "Eg$Egqptyn'means every day other than a Saturday or Sunday or a national
holiday. National holidays shall be those holidays observed NERC.
1.5 "Commission" means the Idaho Public Utilities Commission, or its successor
1.6 "E&g!&E!g" shall have the meaning provided in Section 4 of this Agreement.
|.7..@,meansanyandalIcertificates,credits,benefits,
emissions reductions, environmental air quality credits and emissions reduction credits, offsets and
allowances, howsoever entitled, resulting from the avoidance of the emission of any gas, chemical,
or other substance attributable to the generation of energy by the Facility, and the delivery of such
energy to the electricity grid, and include without limitation, any of the same arising out of any
current or future legislation or regulation concerned with oxides of nitrogen, sulfur, or carbon, with
particulate matter, soot, or mercury, or implementing the United Nations Framework Convention
on Climate Change (*UNFCCC") or the Kyoto Protocol to the UNFCCC or crediting "early
action" with a view thereto, or laws or regulations involving or administered by the Clean Air
Markets Division of the Environmental Protection Agency or successor administrator (collectively
with any state or federal entity given jurisdiction over a program involving transferability of
Environmental Attributes, the "CAMD"), but specifically excluding investment tax credits,
production tax credits, and cash grants associated with the construction or operation of the Facility
and other financial incentives in the form of credits, reductions, or allowances associated with
ownership of the Facility that are applicable to a state or federal income tax obligation, if any.
Environmental Attributes also include the reporting rights or Renewable Energy Certificates
("RECs") associated with these Environmental Attributes. Environmental Attributes include
without limitation all "Environmental Attributes" and all "Green Affributes" as those terms are
defined in Appendix A-l and Appendix A-2 of Califomia Public Utilities Commission D. 08-08-
028 in R. 06-02-012. RECS are accumulated on a MWh basis and one REC represents the
Page - 2 - FIRST AMENDED AND RESTATED LINIVERSITY OF IDAHO POWER
PURCHASE AGREEMENT (STEAM)
Environmental Attributes associated with one MWh of energy. Environmental Attributes do not
include any energy, capacity, reliability or other power attributes from the Facility.
1.8 Reserued.
1.9 "&gi!![,'means the electric energy generating facilities, including all equipment
and structures necessary to generate and supply electric energy, more particularly described at
Exhibit A.
l.l0..@',meanstheelectricenergygeneratedandusedbythe
Facility during its operation to operate equipment that is auxiliary to primary generation equipment
including, but not limited to, pumping, generator excitation, cooling or other operations related to
the production of electric energy by the Facility.
1.l1..@irc,'shallhavethemeaningprovidedinSectionllofthis
Agreement.
l.l2 "FERC" means the Federal Energy Regulatory Commission, or its successor
1.t3*@''theagreementbetweenSellerandAvistawhich
govems how the Net Oulput is delivered to Avista's at the Point of Interconnection during the
Term of this Agreement.
l.l4 "MW'means megawatt. One thousand kilowatts equals one megawatt.
1.15 e'M!Vh" means megawatt-hour. One thousand kilowatt-hours equals one
megawatt-hour.
1.l6..@'meanseighty.fivepercent(85%)ofthePowerDexhourly
Mid-Columbia index ("Mid-C Index") price; provided, however, if the Mid-C Index price is less
than zero, the Market Energy Price shall be one-hundred and fifteen percent (ll5%) of the Mid-C
Index price.
l.l7 "@" means the maximum generating capacity of the
Facility, as determined by the manufacturern and expressed in megawatts (MW) or kilowatts (kW).
l.l8 "NERC' means the North American Electric Reliability Corporation or its
successor
1.19 "Ng!.jE!pE!" means the capability and electric energy generated by the Facility,
less Seller's Load expressed in megawatt-hours (MWh) or kilowatt-hours (kwh).
1.20 "Eqi4!31[.Bg!!ygg" means the location, as specified in Exhibit A of this
Agreement, where the electric energy produced by the Facility is delivered by Seller to Avista's
electrical system.
Page - 3 - FIRST AMENDED AND RESTATED TINIVERSITY OF IDAHO POWER
PURCHASE AGREEMENT (STEAM)
l.2l..@,meansthepractices,methods,andactscommonlyand
ordinarily used in electrical engineering and operations by a significant portion of the electric
power generation and transmission industry, in the exercise of reasonable judgment in the light of
the facts known or that should have been known at the time a decision was made, that would have
been expected to accomplish the desired result in a manner consistent with law" regulation,
reliability, safety, environmental protection, economy, and expedition.
1.22 "Qgl!&igglE4gillg" or "9" means a generating facility which meets the
requirements for "QF" status under PURPA and part 292 of FERC's Regulations. l8 C.F.R. Part
292, and which has obtained certification of its QP status.
1.23 "Sgl!q!.@" means Seller's electrical load on Seller's side ofthe retail meter(s)
through which Avista delivers electric energy to Seller's University campus, including Facility
Service Power, to be served directly by the Facility. For the avoidance of doubt, Seller's Load
shall not include any third-party electrical load or any remote load that requires the output from
the Facility to be delivered across Avista distribution or transmission facilities.
1.24 'Term" shall have the meaning provided in Section 4 of this Agreement.
l.2S "WECC" means the Western Electricity Coordinating Council or its successor
2. WARRANTIES
2.1 No Warrantv bv Avista. Avista makes no warranties, expressed or implied,
regarding any aspect of Seller's design, specifications, equipment or facilities, including, but not
limited to, safety, durability, reliability, strength, capacity, adequacy or economic feasibility, and
any review, acceptance or failure to review Seller's design, specifications, equipment or Facility
shall not be an endorsement or a confirmation by Avista. Avista assumes no responsibility or
obligation with regard to any NERC and/or WECC reliability standard associated with the Facility
or the delivery of electric energy from the Facility to the Point of Delivery.
2.2 Seller's Warranty. Seller warants and represents that: (a) Seller has investigated
and determined that it is capable of performing and will perform the obligations hereunder and has
not relied upon the advice, experience or expertise of Avista in connection with the transactions
contemplated by this Agreement; (b) all professionals and experts including, but not limited to,
engineers, attorneys or accountants, that Seller may have consulted or relied on in undertaking the
transactions contemplated by this Agreement have been solely those of Seller; (c) Seller will
comply with all applicable laws and regulations and shall obtain and comply with applicable
licenses, permits and approvals in the design, construction, operation and maintenance of the
Facility; and (d) the Facility is, and during the Term of this Agreement will remain, a Qualiffing
Facility as that term is used in l8 C.F.R Part292. Seller's failure to maintain Qualiffing Facility
status will be a material breach of this Agreement. Avista reserves the right to review the Seller's
QualiSing Facility status and associated support and compliance documents at any time during
the Term of this Agreement.
PAge - 4 . FIRST AMENDED AND RESTATED UNIVERSITY OF IDAHO POWER
PURCHASE AGREEMENT (STEAM)
3. CONDITIONS PRIOR TO DELIVERY OF NET OUTPUT
3.1 Seller Representation. Seller represents that, prior to the commencement of the
first delivery of Net Output to Avista Seller's licenses, permits and approvals (including, but not
limited to, evidence of compliance with Subpart B, 18 C.F.R. g 292.207, tribal, state and local
business licenses, environmental permits, easements, leases and all other required approvals) are
legally and validly issued, are held in the name of the Seller, and Seller is in substantial compliance
with said permits.
3.2 Indeoendent Enqineering Certifications. Upon Avista's request, prior to the
commencement of the first delivery of Net Output to Avista, Seller shall submit to Avista applicable
Independent Engineering Certifications for Consffuction Adequacy for a Qualiffing Facility. The
Independent Engineering Certification shall be signed by a licensed professional engineer in good
standing and be submitted in a form specified in Exhibit C-I. Avista's acceptance of such forms
shall not be unreasonably withheld. This Section 3.2 shall not apply to a Seller who has previously
provided the certification required by this Section to Avista for the same Facility.
3.3 Interconnection Asreement. Seller shall provide Avista a copy of its
Interconnection Agreement, which shall be attached hereto as Exhibit D.
3.4 Insurance. Upon Avista's request, Seller shall, to the extent applicable, submit to
Avista evidence of compliance with Section 7.1.
3.5 Network Resource Desienation. Upon Avista's request, Seller shall provide to
Avista all data required by Avista to enable the Facility to be designated by Avista as a network
resource.
4. TERMOFAGREEMENT
This Agreement shall be effective on the date last signed below or such other date set by
Commission order (the "Effective Date") and shall continue for twenty (20) years after the
Effective Date (the "Term"), unless otherwise terminated as provided herein.
5. PURCHASE PRICES AND PAYMENT
5.1 Seller Election. To the extent that the Facility generates energy in excess of Seller
Load, Seller elects to provide such energy generated by the Facility to Avista as Seller determines
such energy generated by the Facility is available for sale to Avista (on an as-available basis)
5.2 Avoided Costs Calculated at the Time of Deliver"y. To the extent that Seller
provides energy generated by the Facility to Avista pursuant to Section 5.1, the rate to be paid to
Seller shall be the avoided costs calculated at the time of delivery ("Avoided Cost Rates"), which
shall be, for each hour in which Seller delivers Net Output to Avista at the Point of Delivery after
the Commercial Operation Date, the Market Energy Price for such hour expressed in $ per kWh
multiplied by the total kWh delivered to Avista at the Point of Delivery for such hour,
Page - 5 - FIRST AMENDED AND RESTATED T NIVERSITY OF IDAHO POWER
PURCHASE AGREEMENT (STEAM)
For the avoidance of doubt, the rate to be paid to Seller for any Net Output Seller delivers
to Avista at the Point of Delivery from the Effective Date through the date that the Commission
issues an order (the "Lapse Period") shall be the Market Energy Price. To the extent that Avista
has paid Seller a price other than the Market Energy Price for any Net Output delivered to Avista,
Avista shall issue an invoice or payment to Seller within 30 days of the Commission's order
approving this Agreement lo correct any over or under payment.
5.3 Pavments to Seller. For any calendar month in which Seller has delivered Net
Output from the Facility to Avista in accordance with this Agreement, Avista_shall prepare and
submit to Seller a monthly statement based upon Net Output delivered to Avista during the
previous month. Payments owed by Avista shall be paid no later than the 20th day of the month
following the end ofthe monthly billing period or five days after the receipt of a monthly statement,
whichever is later. If the due date falls on a non-Business Day, then the payment shall be due on
the next Business Day.
5.4 Pavments to Avista and Rieht of Set Off. If Seller is obligated to make any
payment or refund to Avista, Seller agrees that Avista may set off such payment or refund amount
against any current or future payments due Seller under this Agreement. If Avista does not elect
to set off, or if no current or future payment is owed by Avista, Avista shall submit an invoice to
Seller for such payments. Seller shall pay Avista no later than the 20th day of the month following
the end of the monthly billing period or five days after the receipt of a monthly statement,
whichever is later. If the due date falls on a non-Business Day, then the payment shall be due on
the next Business Day.
5.5 Interest. In addition to the remedies set forth in Section l5 of this Agreement, any
arnounts owing after the due date specified in Sections 7.3 and7.4 will be subject to interest in the
amount of one and one half percent (1.5%) per month, not to exceed the maximum rate allowed
by the law, multiplied by the unpaid balance.
5.6 Wire Transfer. All payments shall be made by ACH or wire transfer in accordance
with further agreement of the Parties.
5.1 Title and Risk of Loss. As between the Parties, Seller shall be deemed to be in
control of the output from the Facility up to and until delivery to and receipt by Avista at the Point
of Delivery and Avista shall be deemed to be in control of the Net Output delivered and received
by Avista at the Point of Delivery.
6. EI\TVIRONMENTAL ATTRJBUTES
Seller shall retain and own all Environmental Attributes generated by the Facility.
7. INSURANCEICONTINUINGOBLIGATIONS
7.1 Insurance. Prior to the commencement of the first delivery of Net Output to
Avista, Seller, at its own cost, shall obtain and maintain the following insurance in force over the
term of this Agreement and shall provide certificates of all insurance policies. All insurance
Page - 6 - FIRST AMENDED AND RESTATED UNIVERSITY OF IDAHO POWER
PURCHASE AGREEMENT (STEAM)
policies required to fulfill the requirements of this Section 7 shall include language requiring that
any notice of cancellation or notice of change in policy terms be sent to Avista by the insurance
canier(s) at least sixty days prior to any change or termination of the policies.
7,1.1 General Liabilitv. Seller shall carry commercial general liability insurance
for bodily injury and property damage with a minimum limit equal to $1,000,000 for each
occurence. The deductible shall not exceed the Seller's financial ability to cover claims
and shall not be greater than prevailing practices for similar operations in the State of
Washington.
7.1.2 Propertv. Seller shall carry all-risk properly insurance for repair or
replacement of the Facility. The limit of property insurance shall be sufficient to restore
operations in the event of reasonably foreseeable losses from natural, operational,
mechanical and human-caused perils. The deductible shall not exceed the Seller's financial
ability to fund the cost of losses and shall not be greater than prevailing practices for similar
operations in the State of Idaho.
7.1,3 Oualifving Insurance. The insurance coverage required by this Section 7
shall be obtained from an insurance company reasonably acceptable to Avista and shall
include an endorsement naming Avista as an additional insured and loss payee as
applicable.
7.1.4 Notice of Loss or Laose of Insurance bv Seller. If the insurance coverage
required by this Section 7 is lost or lapses for any reason, Seller will immediately notify
Avista in writing of such loss or lapse. Such notice shall advise Avista of (i) the reason for
such loss or lapse and (ii) the steps Seller is taking to replace or reinstate coverage. Seller's
failure to provide the notice required by this Section and/or to promptly replace or reinstate
coverage will constitute a material breach of this Agreement
7.2 Self-Insurance. Notwithstanding the foregoing, Seller shall be entitled to self-
insure through its self-funded liability pro$am administered by the State of Idaho Offrce of Risk
Management, which has a Combined Single Limit of $500,000. Seller will provide a Certificate
of Financial Responsibility upon request.
7.3 Continuine Oblieations. For the Term of this Agreement, Seller will provide
Avista with the following:
7.3.1 Insurance. Upon Avista's request, Seller shall provide Avista evidence of
compliance with the provisions of Section 7.1. lf Seller fails to comply, such failure will
be a material breach and may only be cured by Seller promptly supplying evidence that the
required insurance coverage has been replaced or reinstated.
7.3.2 Engineer's Certification. If requested by Avista, Seller will supply Avista
with a Certification of Ongoing Operations and Maintenance from a Registered
Professional Engineer licensed in the state in which the Facility is located, which
certification shall be in the form specified in Exhibit C-2. Seller's failure to supply the
Page. 7 - FIRST AMENDED AND RESTATED UNIVERSITY OF IDAHO POWER
PURCHASE AGREEMENT (STEAM)
certificate required by this Section 7.3.2 will be a material breach that may only be cured
by Seller promptly providing the required certificate. Avista may request the Certification
of Ongoing Operations and Maintenance required by this Section once in during the Term.
7.3.3 Licenses and Permits. During the Term of this Agreement. Seller shall
comply with all applicable federal, state, and local laws and regulations. Seller shall
maintain compliance with all permits and licenses described in Section 3.1 of this
Agreement. In addition, Seller will obtain, and supply Avista with copies of, any new or
additional permits or licenses that may be required for Seller's operations. At least every
fifth year after the Effective Date, Seller will update the documentation described in
Section 3.1. If at any time Seller fails to maintain compliance with the permits and licenses
described in Section 3.1 or this Section, or to provide documentation required by this
Section, such failure will be a material breach of this Agreement that may only be cured
by Seller submitting to Avista evidence of compliance.
8. CURTAILMENT.INTERRUPTION OR REDUCTION OF DELIVERY
Avista may require Seller to curtail, interrupt or reduce delivery of Net Output if, in
accordance with Section 9.2, Avista determines that curtailment, intemrption or reduction is
necessary because of a Force Majeure event or to protect persons or property from injury or
damage, or because of emergencies, necessary system maintenance, system modification or special
operating circumstances. Avista will use commercially reasonable efforts to keep any period of
curtailment, intemrption, or reduction to a minimum. In order not to interfere unreasonably with
Seller operations, Avista will, to the extent practical, give Seller reasonable prior notice of any
curtailment, interruption, or reduction, the reason for its occurrence and its probable duration.
Seller understands and agrees that Avista may not be able to provide notice to Seller prior to
intemrption, curtailment, or reduction of electrical energy deliveries to Avista in emergency
circumstances, real-time operations of the electric system, and/or unplanned events"
9. OPERATION
9.1 Communications and Renortinq. Avista and the Seller shall maintain appropriate
operating communications through the Communicating and Reporting Guidelines specified in
Exhibit B.
9,2 Excuse From Accentance of Deliverv of Enerw.
9.2,1 Avista may curtail, intemrpt, reduce or suspend delivery, receipt or
acceptance of Net Output if Avista, in its sole discretion, reasonably determines that such
curtailment, interruption, reduction or suspension is necessary, consistent with Prudent
Utility Practice, and that the failure to do so may:
(a) endanger any person or property, or Avista's electric system, or any
electric system with which Avista's system is interconnected;
Page - 8 - FIRST AMENDED AND RESTATED LINIVERSITY OF IDAHO POWER
PURCHASE AGREEMENT (STEAM)
(b) cause, or contribute to. an imminent significant disruption of electric
service to Avista's or another utility's customers;
(c) interfere with any construction, installation, inspection, testing, repair,
replacement, improvement, alteration, modification, operation, use or maintenance
of, or addition to, Avista's electric system or other property of Avista; or
(d) prevent or interfere with Avista's compliance with any applicable law
or regulatory requirement.
9.2.2 Avista shall promptly notiff Seller of the reasons for any such curtailment,
interruption, reduction or suspension provided for in Section 9.2. Avista shall use
reasonable efforts to limit the duration of any such curtailment, interruption, reduction or
suspension.
9.3 Seller's Rislc Seller shall design, construcl, own, operate and maintain the Facility
at its own risk and expense in compliance with all applicable laws, ordinances, rules, regulations,
orders and other requirements, now or hereafter in effect, of any governmental authority.
9.4 Avista's Risht to Insnect. Seller shall permit Avista to inspect and audit the
Facility, any related production, delivery and scheduling documentation or the operation, use or
maintenance of the Facility at any reasonable time and upon reasonable notice. Seller shall provide
Avista reasonable advance notice of any Facility test or inspection performed by or at the direction
of Seller.
9.5 Seller Oblieations in Accordance with Prudent Utility Practices. Seller shall
own, operate and maintain the Facility and any Seller-owned Interconnection Facilities so as to
allow reliable generation and delivery ofNet Output to Avista for the full Term of the Agreement, in
accordance with Prudent Utility Practices.
9.6 Modifications. Seller shall notify Avista in writing of any material modifications to
the Facility. Material modifications to the Facility include, but are not limited to, any modification
that increases or decreases the Facility nameplate capacity rating, changes the primary energy source,
and changes to the generator fuel. Any material modifications to the Facility, including but not limited
to the generator or turbine, that ( I ) increases the Facility nameplate capacity rating, or (2) changes the
primary energy source, or (3) changes to the generator fuel, will require a review of the Agreement
terms, conditions and pricing and Avista, at its sole determination, may adjust the pricing or terminate
the Agreement. If the Agreement is terminated because of said modifications, the Seller will be
responsible for any termination damages.
IO. INTERCONNECTION.METERINGANDTRANSMISSION
Seller shall make all necessary arrangements to interconnect its Facility with the electrical
system of Avista. Any required metering for the Facility shall be pursuant to the Interconnection
Agreement.
PagC - 9 - FIRST AMENDED AND RESTATED UNIVERSITY OF IDAHO POWER
PURCHASE AGREEMENT (STEAM)
II. FORCE MAJEURE
l1.l Except as expressly provided in Section 11.6, neither Party shall be liable to the
other Party, or be considered to be in breach of or default under this Agreement, for delay in
performance due to a cause or condition beyond such Party's reasonable control which despite the
exercise of reasonable due diligence, such Party is unable to prevent or overcome ("Force
Majeure"), including but not limited to:
(a) fire, flood, earthquake, volcanic activity; court order and act of civil, military
or governmental authority; strike, lockout and other labor dispute; riot, insurection,
sabotage or war; pandemic or epidemic; unanticipated electrical disturbance originating in
or transmitted through such Party's electric system or any electric system with which such
Party's system is interconnected; or
(b) an action taken by such Party which is, in the sole judgment of such Party,
necessary or prudent to protect the operation, performance, integrity, reliability or stability
of such Party's electric system or any electric system with which such Party's electric
system is interconnected, whether such actions occur automatically or manually.
ll.2 In the event of a Force Majeure event, the time for performance shall be extended
by a period of time reasonably necessary to overcome such delay. Avista shall not be required to
pay for Net Output which, as a result of any Force Majeure event, is not delivered.
f l3 Nothing contained in this Section shall require any Party to settle any strike, lockout
or other labor dispute.
ll.4 In the event of a Force Majeure event, the delayed Party shall provide the other
Party notice by telephone or email as soon as reasonably practicable and written notice within
fourteen days after the occurrence of the Force Majeure event. Such notice shall include the
particulars ofthe occurrence. The suspension ofperfonnance shall be ofno greater scope and no
longer duration than is required by the Force Majeure and the delayed Party shall use its best efforts
to remedy its inability to perform.
11.5 Force Majeure shall include any unforeseen electrical disturbance that prevents any
electric energy deliveries from occuring at the Point of Delivery.
I1.6 Notwithstanding anything to the contrary herein, Force Majeure shall not apply to,
or excuse any default under, Sections l5.l(a), l5.l(b), l5.l(c), or l5.l(d). For the avoidance of
doubt, Avista may declare Seller in Default if an event described in any of Sections l5.l(a),
l5.l(b), 15.1(c), or l5.l(d), occrus and Avista may pursue any remedy available to it under this
agreement.
12. INDEMNITY
l2.l Except as precluded by applicable law (including the limitations prescribed by the
laws of the state of Idaho and, to the extent required by such laws, the lawful policies
Page - l0 - FIRST AMENDED AND RESTATED UNIVERSITY OF IDAHO POWER
PURCHASE AGREEMENT (STEAM)
promulgated by the University of ldaho's Board of Regents), the Parties shall at all times
indemnifr, defend, and hold the other Party harmless from, any and all damages, losses, claims,
including claims and actions relating to injury to or death of any person or damage to property,
demand, suits, recoveries, costs and expenses, court costs, attorney fees, and all other obligations
by or to third parties, arising out of or resulting from such Party's action or failure to meet its
obligations under this Agreement, except in cases of gross negligence or intentional wrongdoing
by the indemnified Party. This indemnity shall not extend the responsibility or liability of
University of Idaho beyond that allowed by applicable law, including without limit and to the
extent applicable, the Idaho constitution, the Idaho Tort Claims Act, and Idaho Code sections 59-
1015, 1016, and 1017. Nothing herein shall obligate the Legislature of the State of ldaho to
make future appropriations for any payment of any obligation of the University of ldaho, and any
such obligation is an independent obligation of the University and not of the State of ldaho.
Nothing herein shall be deemed a waiver of the University of Idaho's or the State of ldaho's
sovereign immunity, which is hereby expressly reserved,
12.2 SELLER AND AVISTA SPECIFICALLY WARRANT THAT THE TERMS
AND CONDITIONS OF THE FOREGOING INDEMNITY PROVISIONS ARE THE
SUBJECT OF MUTUAL NEGOTIATION BY THE PARTIES, AND ARE
SPECIFICALLY AND EXPRESSLY AGREED TO IN CONSIDERATION OF THE
MUTUAL BENEFITS DERIVED UNDER THE TERMS OF THE AGREEMENT.
12.3 EXCEPT AS EXPRESSLY PROVIDED HEREIN, NEITHER pARTy
SHALL BE LIABLE UNDER AIYY PROVISION OF THIS AGREEMENT FOR ANY
SPECIAL, INDIRECT, INCIDENTAL, CONSEQUENTIAL, OR PUNITIVE DAMAGES,
INCLUDING BUT NOT LIMITED TO LOSS OF PROFIT, SAVINGS OR REVENUE,
LOSS OF THE USE OF EQUIPMENT, COST OF CAPITAL, OR COST OF
TEMPORARY EQUIPMENT OR SERVICES, WHETHER BASED IN WHOLE OR IN
PART IN CONTRACT, IN TORT, INCLUDING NEGLIGENCE, STRICT LIABILITY,
OR ANY OTHER THEORY OF LIABILITY; PROVIDED, HOWEVER, THAT ANY
AMOUNTS DUE TO SELLER AS PAYMENT FOR NET OUTPUT DELIVERED TO
AVISTA PURSUANT TO THE TERMS OF THIS AGREEMENT SHALL BE DEEMED
TO BE DIRECT DAMAGES.
13. ASSIGNMENT
l3.l Seller shall not assign its rights or delegate its duties under this Agreement without
the prior written consent of Avista, which consent shall not be unreasonably withheld. Subject
to the foregoing restrictions on assignments, this Agreement shall be fully binding upon, inure to
the benefit ofand be enforceable by the Parties and their respective successors, heirs and assigns.
13.2 Seller shall have the right without Avista's consent, but with a thirty days prior
written notice to Avista, to make collateral assignments of its rights under this Agreement to satisfy
the requirements of any development, construction, or other reasonable long-term financing. A
collateral assignment shall not constitute a delegation of Seller's obligations under this Agreement,
and this Agreement shall not bind the collateral assignee. Any collateral assignee succeeding to
Page - I I - FIRST AMENDED AND RESTATED LTNMRSITY OF IDAHO POWER
PURCHASE ACREEMENT (STEAM)
any portion of the ownership interest of Seller shall be considered Seller's successor in interest
and shall thereafter be bound by this Agreement.
14. NO UNSPECIFIED THIRD-PARTY BENEFICIARIES
There ilre no third-party beneficiaries of this Agreement. Nothing contained in this
Agreement is intended to confer any right or interest on anyone other than the Parties, and their
respective successors, heirs and assigns permitted under Section 13.
15. DEFAULT AND TERMINATION
l5.l In addition to any other breach or failure to perform under this Agreement, each of
the following events shall constitute a Default:
(a) The Facility ceases to be a Qualiffing Facility;
b) A Party becomes insolvent (e.g., is unable to meet its obligations as they become
due or its liabilities exceed its assets);
(c) Seller makes a general assignment of substantially all of its assets for the benefit
of its creditors, files a petition for bankruptcy or reorganization or seeks other relief under
any applicable insolvency laws;
(d) Seller has filed against it a petition for bankruptcy, reorganization or other relief
under any applicable insolvency laws and such petition is not dismissed or stayed within
sixty days after it is filed;
(e) Seller is in default under any Agreement related to this Agreement; or
(f) Termination, cancellation or expiration of any agreement required for Seller to
deliver electric energy to Avista under this Agreement, including but not limited to the
Interconnection Agreement.
15.2 Notice and Opportunity to Cure. In the event of a Default, the non-Defaulting
Party shall give written notice to the Defaulting Party of a Default in accordance with Section 27.
Except as provided in Section l5.l (d), if the Defaulting Party has not cured the breach within thirty
days after receipt of such written notice, the non-Defaulting Party may, at its option, terminate this
Agreement and/or pursue any remedy available to it in law or equity; provided that, if a Default
occurs under Sections l5.l(a) or l5.l(f), Seller shall not deliver any Net Output to Avista, and
Avista shall have no obligation to accept any Net Output from the Facility, until such Default is
cured.
15.3 Additional Rights and Remedies. Any right or remedy afforded to either Party
under this Agreement on account of a Default by the other Party is in addition to, and not in lieu
of all other rights or remedies available to such Party under any other provisions of this
Agreement, by law or otherwise on account of the Default.
Page - 12 - FIRST AMENDED AND RESTATED UNIVERSITY OF IDAHO POWER
PURCHASE AGREEMENT (STEAM)
15.4 Damages. If this Agreement is terminated as a result of Seller's Default after the
Effective Date, Seller shall pay Avista, in addition to other damages, the positive difference, if
any, between the applicable Avoided Cost Rate and the cost to replace the Net Output for twelve
months beginning on the date of the original Default, plus all associated transmission costs to
Avista to acquire such replacement Net Output.
16. DISPUTE RESOLUTION
Each Party shall strive to resolve any and all differences during the term of the Agreement
through meetings and discussions. If a dispute cannot be resolved within a reasonable time, not to
exceed thiny days, each Party shall escalate the unresolved dispute to a senior officer designated
by each Party. If the senior officers are not able to resolve the dispute within ten Business Days
of escalation then the Parties may agree to mediate or arbitrate the dispute. In the event that the
Parties do not agree to mediation or arbitration, either Party may, as applicable, request a hearing
before the Commission or seek relief in a court of competent jurisdiction.
17. RELEASE BY SELLER
Seller releases Avista from any and all claims, losses, harm, liabilities, damages, costs and
expenses to the extent resulting from any:
l7.l Electric disturbance or fluctuation that migrates, directly or indirectly, from
Avista's electric system to the Facility;
17.2 Intemrption, suspension or curtailment of electric service to the Facility or any
other premises owned, possessed, controlled or served by Seller, which intemrption, suspension
or curtailment is caused or contributed to by the Facility or the interconnection of the Facility;
17.3 Disconnection, intemrption, suspension or curtailment by Avista pursuant to terms
of this Agreement or the Interconnection Agreement.
18. SEVERAL OBLIGATIONS
The duties, obligations and liabilities of the Parties under this Agreement are intended to
be several not joint or collective. This Agreement shall not be interpreted or construed to create
an association, joint venture or partnership between the Parties. Each Party shall be individually
and severally liable for its own obligations under this Agreement. Further, neither Party shall have
any rights, power or authority to enter into any agreement or undertaking for or on behalf of, to act
as to be an agent or representative of, or to otherwise bind the other Party.
I9. IMPLEMENTATION
Each Party shall promptly take such action (including, but not limited to, the execution,
acknowledgement and delivery of documents) as may be reasonably requested by the other Party
for the implementation or continuing performance of this Agreement.
Page - 13 - FIRST AMENDED AND RESTATED TINIVERSITY OF IDAHO POWER
PURCHASE AGREEMENT (STEAM)
20. NON.WAIVER
The failure of either Party to insist upon or enforce strict performance by the other Party of
any provision of this Agreement or to exercise any right under this Agreement shall not be
construed as a waiver or relinquishment of such Party's right to assert or rely upon any such
provision or right in that or any subsequent instance; rather, the same shall be and remain in full
force and effect.
21. AMENDMENT
No change, amendment or modification of any provision of this Agreement shall be valid
unless set forth in a written amendment to this Agreement signed by both Parties and approved by
the Commission.
22, CHOICE OF LAWS
This Agreement shall be construed and interpreted in accordance with the laws ofthe State
of Idaho without reference to its choice of law provisions.
23, HEADINGS
The Section headings in this Agreement are for convenience only and shall not be
considered part of or used in the interpretation of this Agreement.
24. SEVERABILITY
The invalidity or unenforceability of any provision of this Agreement shall not affect the
validity or enforceability of any other provision of this Agreement, and this Agreement shall be
construed in all respects as if the invalid or unenforceable provision were omitted.
25. COUNTERPARTS
This Agreement may be executed in two or more counterparts, each of which shall be
deemed as an original, and together shall constitute one and the same document.
26. TAXES
Each Party shall pay before delinquency all taxes and other governmental charges which,
if failed to be paid when due, could result in a lien upon the Facility or the Interconnection
Facilities.
Page - 14 - FIRST AMENDED AND RESTATED LINIVERSITY OF IDAHO POWER
PURCHASE AGREEMENT (STEAM)
27. NOTICES
Unless otherwise specified, all written notices or other communications required by or
provided under this Agreement shall be mailed or delivered to the following addresses, and shall
be considered delivered when deposited in the US Mail, postage prepaid, by certified or registered
mail or delivered in person:
to Avista:Director, Power Supply
Avista Corporation
P.O.Box3727
Spokane, WA 99220
to Seller:Director of Facilities
University of Idaho
875 Perimeter Drive, MS228l
Moscow,lD 83844-2281
Either Party may change its designated representative to receive notice and/or address
specified above by giving the other Party written notice of sueh change.
2E. SURVIVAL
Rights and obligations which, by their nature, should survive termination or expiration of
this Agreement, will remain in effect until satisfied, including without limitation, all oustanding
financial obligations, and the provisions of Section 12 (lndemnity) and Section 16 (Dispute
Resolution).
29. ENTIRE AGREEMENT
This Agreement, including the following exhibits which are attached and incorporated by
reference herein, constitutes the entire agreement of the Parties and supersedes all prior and
contemporaneous oral or written agreements between the Parties with respect to the subject matter
hereof.
Exhibit A
Exhibit B
Exhibit C-l
Exhibit C-2
Exhibit D
Project Description and Point of Delivery
Communications and Reporting
Independent Engineering Certifications for Construction Adequacy for a
Qualiffing Facility
Independent Engineering Certifications for Ongoing Operations and
Maintenance for a Quali$ing Facility
lnterconnection A greement
Page - 15 - FIRST AMENDED AND RESTATED UNMRSITY OF IDAHO POWER
PURCHASE AGREEMENT (STEAM)
30. Authoritv
In entering this Agreement, the Seller's representative is acting under delegated authority
under Board of Regents Policy V.l.
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by
their duly authorized representatives as of the date set forth below.
REGETTITS OF THE UNIVERSITY OF AVISTA CORPORATION
IDAHO
a
Printed Name Printed Dennis V
Title President and CEO
Date: q' D'?2 Date: sttol2o2z
Page - 16 - FIRST AMENDED AND RESTATED UNMRSITY OF IDAHO POWER
PURCHASE AGREEMENT (STEAM)
By i)*UJ.
+
Exhibit A
Proiect Descrintion and Point of Deliverv
Seller's Facility is described as University of ldaho Micro-steam Turbine Installation and
consists ofl
Three micro-steam turbine-generator sets, each designed to produce 275 kW, for total
Facility design capacity of 825 kW
Turbine-generators serve to offset campus power needs as well as reducing the pressure
of steam from 170 psig down to 35 psig priorto campus disribution
Leer!&&:
Seller's Facility is located at the University of Idaho Energy Plant, at the northeast corner of 6s
Street and Line Sreet, Moscow,Idaho 83844.
Point of Delivcn,: The Secondary terminals of the Transmission hovider's Distribution
Transformer(s) where the Seller's secondary conductors are connected.
o
a
Exhibit B
Communication and Reoortins
(l) Email communications betrveen Seller and Avista shall be submitted to:
Avista: @auistacorp.com; or
@avistacorp.com
Seller: [e-mail]
Alternate : _ vineyard@ui daho.edu
(2) AII oral communications relating to electric energy scheduling, generation level changes,
intemrptions or outages between Seller and Avista will be communicated on a recorded line as
follows:
(a) Pre-Schedule (5:30 am to l2:00 noon on Business Days):
Avista Pre-Scheduler: (509) 495-491 I
Altemate Phone: [phone]
Seller: [phone]
Altemate Phone: [phone]
(b) Real-Time Schedule (available 24 hours a day)
Avista Real-Time Scheduler: [phone]
Seller: [phone]
Alternate Phone:
(3) Either Party may change its contact information upon uritten notice to the other Party.
Exhibit C-l
Indeoendent Ensineerine Certification for
Construction Adequacv for a Oualifyine Facilitv
arn a licensed professional engineer registered to
practice and in good standing in the State of _. I have substantial experience in the design,
construction and operation of electric power plants of the same type as
(Title of QF) sited at ln
County, State of _ (the "Facility")
2. I have reviewed and/or supervised the review of the construction in progress or of
the completed Facility and it is my professional opinion that said Facility has been designed and
built according to appropriate plans and specifications bearing the words "CERTIFIED FOR
ACCEPTANCE" and with the stamp of the certi$ing licensed professional engineer of the design,
and that the Facility was built to commercially acceptable standards for this type of facility.
3. I have no economic relationship to the designer or owner of said Facility and have
made my analysis of the plans and specifications independently.
4. I hereby CERTIFY that the above statements are complete, true, and accurate to the
best of my knowledge and I therefore set my hand and seal below.
Signed and Sealed
DATE:
SIGNATURE:
PRINTED NAME
l. I
Exhibit C -2
Indenendent Engineerins Certification of Onsoins Operations and
Maintenance for a Oualifvine tr'acilitv
l. The undersigned is a duly authorized representative of ln lts
capacity asanindependent engineer(the "Independent Engineer"). The Independent
Engineer has substantial experience reviewing the design, construction, and operation
ofelectric power plants ofthe same type as the University of ldaho's micro-steam turbine-
generator sets ("Facility").
2. Independent Engineer has reviewed the operation and maintenance agreement ("O&M
Agreement"') for the Facility and it is the Independent Engineer's professional opinion that,
provided the Facility has been designed and built to appropriate standards, the O&M
Agreement is the same as the original O&M Agreement in place at COD, the is consistent
with Prudent Utility Practices (as defined in the Agreement) and therefore is considered
adequate to support the Facility's production of energy in accordance with the requirements
of the Agreement, noting that the Independent Engineer makes no representation as to the
amounts of energy that will be produced by the Facility.
3. Independent Engineer has no economic relationship to the designer or owner of said Facility
and has made its analysis ofthe O&M Agreement independently.
4. Independent Engineerhereby confirmsthattheabove statements are complete, true, and
accurate to the best of its knowledge.
Signed and Sealed
DATE:
SIGNATURE
PRINTED NAME:
Erhtbit I)
Intorneonnection Asreement
The Parties *knowledge that Atachtnent 2 to the aHchcd Iatsconnestion Agrce, ent states the
nuneplate capacity of the Faeility is 1,050 kW. Forpurpooos of this Amended and Restatd
Power Purchase Agrcoment, th Partios agrce that the Nameplate Capacity Ratingof thc Faciliff
is 825 kW .dlternating Currenr (AC), $r more fully dcscribed in Exhibit A.
FIRST AMENDED AND RESTATED
POWER PURCHASE AGREEMENT
BETWEEN
REGENTS OF TIIE I]NIVERSITY OF IDAIIO
ATID
AVISTA CORPORATION
POWER PURCHASE AGREEMENT (STEAM)
This First Amended and Restated Power Purchase Agreement (."AgreementJ is made by
and between Avista Corporation, a Washington corporation ("Avista"), and the Regents of the
University of Idaho ("Seller"). Avista and Seller are sometimes referred to individually as a
6'Party" and collectively as the "Parties."
RECITALS
WHEREAS. the Parties entered into a Power Purchase Aereement (."Original Agreement")
fhof rrroo crrhmiffarl to the Idaho Public I Itilities ^-miooi^- f^. onnrn.rql nn Fphnrqnt )a ?fi)).
WHEREAS. Commission Staffrecommended certain revisions to the Original Agreement:
WHEREAS, the Parties enter into this Aereement to amend the Original A$eement
Staff s recommendation and intend this to
replace the Original Aereement in its entirety:
WHEREAS, Seller will own, operate and maintain the electric power generating facility
with a Nameplate Capacity Rating of 825 kW Alternating Current (AC), as more fully described
in Exhibit A ("Facility");
WHEREAS, Seller will operate the Facility as a Qualifring Facility, as defined by the
Public Utility Regulatory Policies Act of 1978 ("PURPA");
WHEREAS, Seller will use the Facility to serve Seller's Load (as defined herein); and
WHEREAS, to the extent the output generated from the Facility exceeds Seller's Load,
Seller will deliver and sell to Avista on an as-available basis, and Avista will purchase, output
generated from the Facility subject to the terms of this Agreement.
Page - I - UNIVERSITY OF IDAHO POWER PURCHASE AGREEMENT (STEAM)
NOW, THEREFORE, in consideration of the mutual agreements set forth herein, the
Parties agree as follows.
1. DEFINITIONS
Except as otherwise defined in this Agreement, whenever used in this Agreerrent and
exhibits hereto, the following terms shall have the following meanings:
1.1 "A@'means this First Amend and Restated Power Purchase Agreement,
including all exhibits, and any written amendments.
1.2 6'Avoided Cost Rates" shall have the meaning provided in Section 5.2 of this
Agreement.
1.3 "allilly" means average megawatt(s). An average megawatt is calculated by
dividing the total generation in MWh over a glven period of time (e.9., a calendar month) by the
number ofhours in that period of time.
1.4 "EE!!g$!eX" means every day other than a Saturday or Sunday or a national
holiday. National holidays shall be those holidays observed NERC.
"Commission" means the Idaho Public Utilities Commission, or its successor
"E@g1!!g.D{g" shall have the meaning provided in Section 4 of this Agreement.
1.7 "@ means any and all certificates, credits, benefits,
smissions reductions, environmental air quality credits and emissions reduction credits, offsets and
allowances, howsoever entitled, resulting from the avoidance ofthe emission of any gas, chemical,
or other substance attributable to the generation of energy by the Facility, and the delivery of such
energy to the electricity grid, and include without limitation, any of the same arising out of any
current or future legislation or regulation concerned with oxides of nitrogen, sulfur, or carbon, with
particulate matter, soot, or mercury, or implementing the United Nations Framework Convention
on Climate Change ("UNFCCC") or the Kyoto Protocol to the LINFCCC or crediting "early
action" with a view thereto, or laws or regulations involving or administered by the Clean Air
Markets Division of the Environmental Protection Agency or successor administrator (collectively
with any state or federal entity grven jurisdiction over a program involving transferability of
Environmental Attributes, the "CAMD"), but specifically excluding investrnent tax credits,
production tax credits, and cash grants associated with the construction or operation ofthe Facility
and other financial incentives in the form of credits, reductions, or allowances associated with
ownership of the Facility that are applicable to a state or federal income tax obligation, if any.
Environmental Attributes also include the reporting rights or Renewable Energy Certificates
("RECs") associated with these Environmental Attributes. Environmental Attributes include
without limitation all "Environmental Attributes" and all "Green Attributes" as those terms are
defined in Appendix A-l and Appendix A-2 of California Public Utilities Commission D. 08-08-
028 in R. 06-02-012. RECS are accumulated on a MWh basis and one REC represents the
1.5
1.6
Page - 2 - UNIVERSITY OF IDAHO POWER PURCHASE AGREEMENT (STEAM)
Environmental Attributes associated with one MWh of energy. Environmental Attributes do not
include any energy, capaaty, reliability or other power attributes from the Facility.
1.8 Reserved.
1.9 "E4![!g" means the electric energy generating facilities, including all equipment
and structures necessary to generate and supply electric energy, more particularly described at
Exhibit A.
1.10 "@" means the elecfric energy generated and used by the
Facility during its operation to operate equipment that is auxiliary to primary generation equipment
including, but not limited to, pumping, generator excitation, cooling or other operations related to
the production of electric energy by the Facility.
1.11
Agreement.
"EgIgg_-@iq,' shall have the meaning provided in Section l1 of this
1.12 6'EBgt' means the Federal Energy Regulatory Commission, or its successor.
1.13 " the agreement between Seller and Avista which
governs how the Net Output is delivered to Avista's at the Point of lnterconnection during the
Term of this Agreement.
l.l4 "lfiMt' means megawatt. One thousand kilowatts equals one megawatt.
1.15 6'lllMt' means megawatt-hour. One thousand kilowatt-hours equals one
megawatt-hour.
1.16 "@'means eighty-fivepercent (85%) ofthe PowerDex hourly
than zero. the Market Enerqv Price shall be one-hundred and fifteen percent (l l5%) of the Mid-C
Index price.
l.l7 t'\ameplate Capacity Rating' means the maximum generating capacity of the
Facility, as determined by the manufacturer, and expressed in megawatts (MW) or kilowatts GVD.
1.18 *NERC' means the North American Electric Reliability Corporation or its
successor.
l.l9 "N@@!" means the capability and electric energy generated by the Facility,
less Seller's Load expressed in megawatt-hours (MWh) or kilowatt-hours (k!Yh).
|,20"@'meansthelocation,asspecifiedinExhibitAofthis
Agreement, where the electric energy produced by the Facility is delivered by Seller to Avista's
electrical system.
Page - 3 - UNIVERSITY OF IDAHO POWER PURCHASE AGREEMENT (STEAM)
l.2l "@" means the practices, methods, and acts commonly and
ordinarily used in electrical engineering and operations by a significant portion of the electric
powsr generation and transmission industry, in the exercise of reasonable judgment in the light of
the facts known or that should have been known at the time a decision was made, that would have
been expected to accomplish the desired result in a manner consistent with law, regulation,
reliability, safety, environmental protection, economy, and expedition.
l.22..@,,or..G,,meansageneratingfaci1itywhichmeetsthe
requirements for "QF" status under PURPA and part 292 of FERC's Regulations, l8 C.F.R. Part
292, and which has obtained certification of its QF status.
1.23 "Sg!!g@" means Seller's electrical load on Seller's side of the retail meter(s)
through which Avista delivers electric energy to Seller's University campus, including Facility
Service Power, to be served directly by the Facility. For the avoidance of doubt, Seller's Load
shall not include any third-party electrical load or any remote load that requires the output from
the Facility to be delivered across Avista distribution or transmission facilities.
1.24 66Term" shall have the meaning provided in Section 4 of this Agreement.
1.25 "W'means the Western Electricity Coordinating Council or its successor
2. WARRANTIES
2.1 No Warrantv bv Avista. Avista makes no waranties, expressed or implied,
regarding any aspect of Seller's design, specifications, equipment or facilities, including, but not
limited to, safety, durability, reliability, strength, capacity, adequacy or economic feasibility, and
any review, acceptance or failure to review Seller's design, specifications, equipment or Facility
shall not be an endorsement or a confirmation by Avista. Avista assumes no responsibility or
obligation with regard to anyNERC and/or WECC reliability standard associated with the Facility
or the delivery of electric energy from the Facility to the Point of Delivery.
2.2 Seller's Warrantv. Sellerwarrants and represents that: (a) Sellerhas investigated
and determined that it is capable of performing and will perform the obligations hereunder and has
not relied upon the advice, experience or expertise of Avista in connection with the hansactions
contemplated by this Agreement; (b) all professionals and experts including, but not limited to,
engineers, attorneys or accountants, that Seller may have consulted or relied on in undertaking the
transactions contemplated by this Agreement have been solely those of Seller; (c) Seller will
comply with all applicable laws and regulations and shall obtain and comply with applicable
licenses, permits and approvals in the design, construction, operation and maintenance of the
Facility; and (d) the Facility is, and during the Term of this Agreement will rernain, a Qualifoing
Facility as that term is used in l8 C.F.R Part292. Seller's failure to maintain Qualiffing Facility
status will be a material breach of this Agreement. Avista reserves the right to review the Seller's
Qualiffing Facility status and associated support and compliance documents at any time during
the Term of this Agreernent.
3. CONDITIONS PRIOR TO DELIVERY OF NET OUTPUT
Page - 4 - UNIVERSITY OF IDAHO POWER PURCHASE AGREEMENT (STEAM)
3.1 Seller Representation. Seller represents that, prior to the cofllmencement of the
first delivery of Net Output to Avista Seller's licenses, permits and approvals (including, but not
limited to, evidence of compliance with Subpart B, 18 C.F.R. $ 292.207, fibal, state and local
business licenses, environmental permits, easernents, leases and all other required approvals) are
legally and validly issued, are held in the name ofthe Seller, and Seller is in substantial compliance
with said permits.
3.2 Independent Engineerins Certilications. Upon Avista's request prior to the
commencement of the first delivery of Net Output to Avista, Seller shall submit to Avista applicable
Independent Engineoing Certifications for Consfruction Adequacy for a Qualiffing Facility. The
Independent Engineoing Certification shall be signed by a licensed professional e,ngineer in good
standing and be submitted in a form specified in Exhibit C-1. Avista's acceptance of such forms
shall not be unreasonably wittrheld. This Section 3.2 shall not apply to a Seller who has previously
provided the certification required by this Section to Avista for the same Facility.
3.3 Interconnection Agreement. Seller shall provide Avista a copy of its
Interconnection Agreement, which shall be attached hereto as Exhibit D.
3.4 Insurance. Upon Avista's request, Seller shall, to the exte,nt applicable, submit to
Avista evidence of compliance with SectionT.l.
3.5 Network Resource Designation. Upon Avista's request, Seller shall provide to
Avista all data required by Avista to enable the Facility to be designated by Avista as a network
resource.
4. TERM OFAGREEMENT
This Agreement shall be ef[ective on the date last signed below or such other date set by
Commission order (the "Effective Date") and shall continue for twenty (20) years after the
Eflective Date (the o'Term"), unless otherwise terminated as provided herein.
5. PTJRCHASE PRICES AI\D PAYMENT
5.1 Seller Election. To the extent that the Facility generates energy in excess of Seller
Load, Seller elects to provide such energy generated by the Facility to Avista as Seller determines
such energy generated by the Facility is available for sale to Avista (on an as-available basis)
5.2 Avoided Costs Calculated at the Time of Deliverv. To the extent that Seller
provides energy generated by the Facility to Avista pursuant to Section 5.1, the rate to be paid to
Seller shall be the avoided costs calculated at the time of delivery ("Avoided Cost Rates"), which
shall be, for each hour in which Seller delivers Net Output to Avista at the Point of Delivery after
the Commercial Operation Date, the Market Energy Price for such hour expressed in $ per kWh
multiplied by the total kWh delivered to Avista at the Point of Delivery for such hour.
Page - 5 - UNIVERSITY OF IDAHO POWER PURCHASE AGREEMENT (STEAM)
For the avoidance of doubt. the rate to be paid to Seller for any Net Output Seller delivers
to Avista at the Point of Delivery from the Effective Date throueh the date that the Commission
issues an order (the "Lapse Period") shall be the Market Enerqy Price. To the extent that Avista
has paid Seller a price other than the Market Energy Price for any Net Output delivered to Avista.
Avista shall issue an invoice or payment to Seller within 30 days of the Commission's order
approvin&this Agreement to correct any over or under payment.
5.3 Pavments to Seller. For any calendar month in which Seller has delivered Net
Output from the Facility to Avista in accordance with this Agreement, Avista_shall prepare and
submit to Seller a monthly statement based upon Net Output delivered to Avista during the
previous month. Payments owed by Avista shall be paid no later than the 206 day of the month
following the end of the monthly billing period or five days after the receipt of a monthly statonent,
whichever is later. If the due date falls on a non-Business Day, then the payment shall be due on
the next Business Day.
5.4 Pavments to Avista and Right of Set Off. If Seller is obligated to make any
payment or refund to Avista, Seller agrees that Avista may set offsuch payment or refund amount
against any current or future payments due Seller under this Agreement. If Avista does not elect
to set off, or if no current or future payment is owed by Avista, Avista shall submit an invoice to
Seller for such payments. Seller shall pay Avista no later than the 2Oh day of the month following
the end of the monthly billing period or five days after the receipt of a monthly statonent,
whichever is later. If the due date falls on a non-Business Day, then the payment shall be due on
the next Business Day.
5.5 Interest. In addition to the remedies set forth in Section 15 of this Agreement, any
amounts owing after the due date specified in Sections 7.3 and7.4 will be subject to interest in the
amount of one and one half percent (1.5%) per month, not to exceed the maximum rate allowed
by the law, multiplied by the unpaid balance.
5.6 Wire Transfer. All payments shall be made by ACH or wire transfer in accordance
with further agreement of the Parties.
5.7 Title and Risk of Loss. As between the Parties, Seller shall be deemed to be in
control of the output from the Facility up to and until delivery to and receipt by Avista at the Point
of Delivery and Avista shall be deerned to be in control of the Net Output delivered and received
by Avista at the Point of Delivery.
6. EIWIRONMENTAL ATTRIBUTES
Seller shall retain and own all Environmental Attributes generated by the Facility
7. INSURANCE:CONTINUINGOBLIGATIONS
7.1 Insurance. Prior to the cofilmencement of the first delivery of Net Output to
Avista, Seller, at its own cost, shall obtain and maintain the following insurance in force over the
term of this Agreement and shall provide certificates of all insurance policies. All insurance
Page - 6 - UNIVERSITY OF IDAHO POWER PURCHASE AGREEMENT (STEAM)
policies required to fulfill the requironents of this Section 7 shall include language requiring that
any notice of cancellation or notice of change in policy terms be sent to Avista by the insurance
carrier(s) at least sixty days prior to any change or termination of the policies.
7.1.1 General Liabilitv. Seller shall carry commercial general liability insurance
for bodily injury and property damage with a minimum limit equal to $1,000,000 for each
occurrence. The deductible shall not exceed the Seller's financial ability to cover claims
and shall not be greater than prevailing practices for similar operations in the State of
Washington.
7.1.2 Property. Seller shall carry all-risk property insurance for repair or
replacement of the Facility. The limit of property insurance shall be sufficient to restore
operations in the event of reasonably foreseeable losses from natural, operational,
mechanical and human-caused perils. The deductible shall not exceed the Seller's financial
ability to fund the cost of losses and shall not be greater than prevailing practices for similar
operations in the State of Idaho.
7.1.3 Oualifvins Insurance. The insurance coverage required by this Section 7
shall be obtained from an insurance company reasonably acceptable to Avista and shall
include an endorsement naming Avista as an additional insured and loss payee as
applicable.
7.1.4 Notice of Loss or Lapse of Insurance bv Seller. If the insurance coverage
required by this Section 7 is lost or lapses for any reason, Seller will immediately notiff
Avista in writing of such loss or lapse. Such notice shall advise Avista of (i) the reason for
such loss or lapse and (ii) the steps Seller is taking to replace or reinstate coverage. Seller's
failure to provide the notice required by this Section and/or to promptly replace or reinstate
coverage will constitute a material breach of this Agreement
7.2 Self-Insurance. Notwithstanding the foregoing, Seller shall be entitled to self-
insure through its self-funded liability program administered by the State of Idaho Office of Risk
Management, which has a Combined Single Limit of $500,000. Seller will provide a Certificate
of Financial Responsibility upon roquest.
7.3 Continuine Oblieations. For the Term of this Agreement, Seller will provide
Avista with the following:
7.3.1 Insurance. Upon Avista's request, Seller shall provide Avista evidence of
compliance with the provisions of Section 7 .1. lf Seller fails to comply, such failure will
be amaterial breach and may only be cured by Sellerpromptly supplying evidence that the
required insurance coverage has been replaced or reinstated.
7.3.2 Ensineer's Certification. IfrequestedbyAvistq Sellerwill supplyAvista
with a Certification of Ongoing Operations and Maintenance from a Registered
Professional Engineer licensed in the state in which the Facility is located, which
certification shall be in the form specified in Exhibit C-2. Seller's failure to supply the
Page - 7 - UNIVERSITY OF IDAHO POWER PURCHASE AGREEMENT (STEAM)
certificate required by this Section 7.3.2 will be a material breach that may only be cured
by Seller promptly providing the required certificate. Avista may request the Certification
of Ongoing Operations and Maintenance required by this Section once in during the Term.
7.3.3 Licenses and Permits. During the Term of this Agreernent, Seller shall
comply with all applicable federal, state, and local laws and regulations. Seller shall
maintain compliance with all permits and licenses described in Section 3.1 of this
Agreement. In addition, Seller will obtain, and supply Avista with copies oq any new or
additional permits or licenses that may be required for Seller's operations. At least every
fifth year after the Effective Date, Seller will update the documentation described in
Section 3 . 1 . If at any time Seller fails to maintain compliance with the permits and licenses
described in Section 3.1 or this Section, or to provide documentation required by this
Section, such failure will be a material breach of this Agreement that may only be cured
by Seller submitting to Avista evidence of compliance.
8. CURTAILMENT.INTERRUPTION OR REDUCTION OF DELTVERY
Avista may require Seller to curtail, interrupt or reduce delivery of Net Output if, in
accordance with Section9.2, Avista determines that curtailment, intemrption or reduction is
necessary because of a Force Majeure event or to protect persons or property from injury or
damage, orbecause of emergencies, necessary system maintenance, system modification or special
operating circumstances. Avista will use commercially reasonable efforts to keep any period of
curtailment, intemrption, or reduction to a minimum. In order not to interfere unreasonably with
Seller operations, Avista will, to the extent practical, give Seller reasonable prior notice of any
curtailment, intemrption, or reduction, the reason for its occrurence and its probable duration.
Seller understands and agrees that Avista may not be able to provide notice to Seller prior to
interruption, curtailment, or reduction of electrical energy deliveries to Avista in emergency
circumstances, real-time operations of the electric system, and/or unplanned events.
9. OPERATION
9.1 Communications and Reporting. Avista and the Seller shall maintain appropriate
operating communications through the Communicating and Reporting Guidelines specified in
Exhibit B.
9,2 Excuse From Acceptance of I)elivery of Enersv.
9.2.1 Avista may curtail, intemrpt, reduce or suspend delivery, receipt or
acceptance of Net Output if Avista, in its sole discretion, reasonably determines that such
curtailment, intemrption, reduction or suspension is necessary, consistent with Prudent
Utility Practice, and that the failure to do so may:
(a) endanger any person or property, or Avista's electric system, or any
electric system with which Avista's system is interconnected;
Page - 8 - UNIVERSITY OF IDAHO POWER PURCHASE AGREEMENT (STEAM)
@) cause, or confribute to, an imminent significant disruption of electric
service to Avista's or another utility's customers;
(c) interfere with any construction, installation, inspection, testing, repair,
replacement, improvement, alteration, modification, operation, use or maintenance
of, or addition to, Avista's electric system or other property of Avista; or
(d) prevent or interfere with Avista's compliance with any applicable law
or regulatory requirement.
9.2.2 Avista shall promptly notiff Seller of the reasons for any such curtailment,
intemrption, reduction or suspension provided for in Section 9.2. Avista shall use
reasonable efforts to limit the duration of any such curtailment, interruption, reduction or
suspension.
9.3 Seller's Risk. Seller shall design, construct, own, operate and maintain the Facility
at its own risk and expense in compliance with all applicable laws, ordinances, rules, regulations,
orders and other requirernents, now or hereafter in efiflect, of any governmental authority.
9.4 Avista's Risht to Inspect. Seller shall permit Avista to inspect and audit the
Facility, any related production, delivery and scheduling documentation or the operation, use or
maintenance of the Facility at any reasonable time and upon reasonable notice. Seller shall provide
Avista reasonable advance notice of any Facility test or inspection performed by or at the direction
of Seller.
9.5 Seller Oblieations in Accordance with Prudent Utilitv Practices. Seller shall
own, operate and maintain the Facility and any Seller-owned Interconnection Facilities so as to
allow reliable generation and delivery of Net Output to Avista for the full Term of the Agreement, in
accordance wittr Prudent Utility Practices.
9.6 Modifications. Seller shall notiff Avista in writing of any material modifications to
the Facility. Material modifications to the Facility include, but are not limited to, any modification
that increases or decreases the Facility nameplate capacrty rating, changes the primary energy source,
and changes to the generator fuel. Any material modifications to the Facility, including but not limited
to the generator or turbine, that (l) increases the Facility nameplate capacity rating, or (2) changes the
primary energy source, or (3) changes to the generator fuel, will require a review of the Agreement
terms, conditions and pricing and Avista, at its sole determination, may adjust the pricing or terminate
the Agreement. If the Agreernent is ternrinated because of said modifications, the Seller will be
responsible for any termination damages.
10. INTERCOI\NECTION.METERINGANDTRANSMISSION
Seller shall make all necessary arangements to interconnect its Facility with the electrical
system of Avista. Any required metering for the Facility shall be pursuant to the Interconnection
Agreement.
11. FORCE MAJEURE
Page - 9 - UNIVERSITY OF IDAHO POWER PURCHASE AGREEMENT (STEAM)
11.1 Except as expressly provided in Section I 1.6, neither Party shall be liable to the
other Party, or be considered to be in breach of or default under this Agreement, for delay in
performance due to a cause or condition beyond such Party's reasonable control which despite the
exercise of reasonable due diligence, such Party is unable to prevent or overcome ("Force
Majeure"), including but not limited to:
(a) fire, flood, earthquake, volcanic activity; court order and act of civil, military
or govemmental authority; strike, lockout and other labor dispute; riot, insurrection,
sabotage or war; pandemic or epidemic; unanticipated electrical disturbance originating in
or transmitted through such Party's electric system or any electric system with which such
Party's system is interconnected; or
O) an action taken by such Party which is, in the sole judgment of such Party,
necessary or prudent to protect the operation, performance, integrity, reliability or stability
of such Party's electric system or any electric system with which such Party's electric
systern is interconnected, whether such actions occur automatically or manually.
ll.2 In the event of a Force Majeure event, the time for performance shall be extended
by a period of time reasonably necessary to overcome such delay. Avista shall not be required to
pay for Net Output which, as a result of any Force Majeure event, is not delivered.
11.3 Nothing contained in this Section shall require any Party to settle any strike, lockout
or other labor dispute.
ll.4 In the event of a Force Majeure event, the delayed Party shall provide the other
Party notice by telephone or email as soon as reasonably practicable and written notice within
fourteen days after the occurrence of the Force Majeure event. Such notice shall include the
particulars of the occrurence. The suspension of performance shall be of no greater scope and no
longer duration than is required by the Force Majeure and the delayed Party shall use its best efforts
to remedy its inability to perform.
11.5 Force Majeure shall include any unforeseen elechical disturbance that prevents any
electric energy deliveries from occurring at the Point of Delivery.
11.6 Notwithstanding anything to the contrary herein, Force Majeure shall not apply to,
or excuse any default under, Sections 15.1(a), 15.1(b), 15.1(c), or 15.1(d). For the avoidance of
doubt, Avista may declare Seller in Default if an event described in any of Sections 15.1(a),
l5.lO), l5.l(c), or 15.1(d), occurs and Avista may pursue any remedy available to it under this
agreement.
12. INDEMNITY
l2.l Except as precluded by applicable law (including the limitations prescribed by the
laws of the state of Idaho and, to the extent required by such laws, the lawful policies
promulgated by the University of Idaho's Board of Regents), the Parties shall at all times
Page - 10 - UNIVERSITY OF IDAHO POWER PURCHASE AGREEMENT (STEAM)
indemnit, defend, and hold the other Party harmless from, any and all damages, losses, claims,
including claims and actions relating to injury to or death of any person or damage to property,
demand, suits, recoveries, costs and expenses, court costs, attorney fees, and all other obligations
by or to third parties, arising out of or resulting from such Party's action or failure to meet its
obligations under this Agreement, except in cases of gross negligence or intentional wrongdoing
by the indemnified Party. This indernnity shall not extend the responsibility or liability of
University of Idaho beyond that allowed by applicable law, including without limit and to the
extent applicable, the Idaho constitution, the Idaho Tort Claims Act, and Idaho Code sections 59-
1015, 1016, and 1017. Nothing herein shall obligate the Legislature of the State of Idaho to
make future appropriations for any payment of any obligation of the University of Idaho, and any
such obligation is an independent obligation of the University and not of the State of Idaho.
Nothing herein shall be deemed a waiver of the University of Idaho's or the State of ldaho's
sovereign immunity, which is hereby expressly reserved.
I2.2 SELLER ATID AVISTA SPECIFICALLY WARRANT THAT THE TERMS
AND CONDITIONS OF THE FOREGOING INDEMNITY PROVISIONS ARE THE
SUBJECT OF MUTUAL NEGOTIATION BY TIIE PARTIES, AND ARE
SPECIFICALLY AI\D EXPRESSLY AGREED TO IN CONSIDERATION OF THE
MUTUAL BENEFITS DERTVED TINDER THE TERMS OF TIIE AGREEMENT.
12.3 EXCEPT AS EXPRESSLY PROVTDED HEREIN, NEITITER pARTy
SHALL BE LIABLE T]NDER ANY PROVISION OF THIS AGREEMENT FOR AITY
SPECIAL, INDIRECT, INCIDENTAL, CONSEQUENTIAL, OR PIJNITIVE DAMAGES,
TNCLUDING BUT NOT LIMITED TO LOSS OF PROFIT, SAVTNGS OR REVENUE,
LOSS OF THE USE OF EQUIPMENT, COST OF CAPITAL, OR COST OF
TEMPORARY EQUIPMENT OR SERVICES, WHETHER BASED IN WHOLE OR IN
PART IN CONTRACT, IN TORT, INCLUDING NEGLIGENCE, STRICT LIABILITY,
OR ANY OTIIER THEORY OF LIABILITY; PROVIDED, HOWEVE& THAT AIYY
AMOT]NTS DUE TO SELLER AS PAYMENT FOR NET OUTPUT DELIYERED TO
AVISTA PURSUAI\T TO THE TERMS OF TIIIS AGREEMENT SHALL BE DEEMED
TO BE DIRECT DAMAGES.
13. ASSIGNMENT
13.f Seller shall not assign its rights or delegate its duties under this Agreement without
the prior written consent of Avista, which consent shall not be unreasonably withheld. Subject
to the foregoing restrictions on assignments, this Agreement shall be fully binding upon, inure to
the benefit of and be enforceable by the Parties and their respective successors, heirs and assigns.
13.2 Seller shall have the right without Avista's consent, but with a thirty days prior
written notice to Avista, to make collateral assignments of its rights under this Agreemort to satisfr
the requirements of any development, construction, or other reasonable long-term financing. A
collateral assignment shall not constitute a delegation of Seller's obligations under this Agreement,
and this Agreement shall not bind the collateral assignee. Any collateral assignee succeeding to
any portion of the ownership interest of Seller shall be considered Seller's successor in interest
and shall thereafter be bound by this Agreement.
Page - 1l - UNIVERSITY OF IDAHO POWER PURCHASE AGREEMENT (STEAM)
14. NOUNSPECIFIEDTIIIRD-PARTYBENEFICIARIES
There are no third-party beneficiaries of this Agreernent. Nothing contained in this
Agreement is intended to confer any right or interest on anyone other than the Parties, and their
respective successors, heirs and assigns permitted under Section 13.
15. DEFAT'LT AIYD TERMINATION
15.1 In addition to any other breach or failure to perform under this Agreement, each of
the following events shall constitute a Default:
(a) The Facility ceases to be a Qualiffing Facility;
b) A Party becomes insolvent (e.g., is unable to meet its obligations as they become
due or its liabilities exceed its assets);
(c) Seller makes a general assignment of substantially all of its assets for the benefit
of its creditors, files a petition for bankruptcy or reorganization or seeks other relief under
any applicable insolvency laws;
(d) Seller has filed against it a petition for bankruptcy, reorganizationor other relief
under any applicable insolvency laws and such petition is not dismissed or stayed within
sixty days after it is filed;
(e) Seller is in default under any Agreement related to this Agreement; or
(f) Termination, cancellation or expiration of any agreement required for Seller to
deliver electric enerry to Avista under this Agreement, including but not limited to the
lnterconnection Agreement.
15.2 Notice and Opportunity to Cure. In the event of a Default, the non-Defaulting
Party shall give written notice to the Defaulting Party of a Default in accordance with Section 27.
Except as provided in Section 15.1(d), if the Defaulting Party has not cured the breach within thirty
days after receipt of such written notice, the non-Defaulting Party may, at its option, terminate this
Agreernent and/or pursue any remedy available to it in law or equity; provided that, if a Default
occurs under Sections l5.l(a) or 15.1(f), Seller shall not deliver any Net Output to Avista, and
Avista shall have no obligation to accept any Net Output from the Facility, until such Default is
cured.
15.3 Additional Rights and Remedies. Any right or remedy afforded to either Party
under this Agreement on account of a Default by the other Party is in addition to, and not in lieu
of, all other rights or remedies available to such Party under any other provisions of this
Agreement, by law or otherwise on account of the Default.
Page - 12 - LINIVERSITY OF IDAHO POWER PURCHASE AGREEMENT (STEAM)
15.4 Damages. If this Agreement is terminated as a result of Seller's Default after the
Effective Date, Seller shall pay Avista, in addition to other damages, the positive dif[erence, if
any, between the applicable Avoided Cost Rate and the cost to replace the Net Output for twelve
months beginning on the date of the original Default, plus all associated transmission costs to
Avista to acquire such replacement Net Output.
16. DISPUTE RESOLUTION
Each Party shall strive to resolve any and all differences during the term of the Agreonent
through meetings and discussions. If a dispute cannot be resolved within a reasonable time, not to
exceed thirty days, each Party shall escalate the unresolved dispute to a senior officer designated
by each Party. If the senior officers are not able to resolve the dispute within ten Business Days
of escalation then the Parties may agree to mediate or arbitrate the dispute. In the event that the
Parties do not agree to mediation or arbitration, either Party may, as applicable, request a hearing
before the Commission or seek relief in a court of competent jurisdiction.
17. RELEASE BY SELLER
Seller releases Avista from any and all claims, losses, harm, liabilities, damages, costs and
expenses to the extent resulting from any:
17.1 Electric disturbance or fluctuation that migrates, directly or indirectly, from
Avista's electric system to the Facility;
17,2 Intemrption, suspension or curtailment of electric service to the Facility or any
other prernises owned, possessed, controlled or served by Seller, which intemrption, suspension
or curtailment is caused or contributed to by the Facility or the interconnection of the Facility;
17.3 Disconnection, intemrption, suspension or curtailment by Avista pursuant to terms
of this Agreonent or the Interconnection Agreernent.
18. SEVERAL OBLIGATIONS
The duties, obligations and liabilities of the Parties under this Agreanent are intended to
be several not joint or collective. This Agreement shall not be interpreted or construed to create
an association, joint venture or parfirership between the Parties. Each Party shall be individually
and severally liable for its own obligations under this Agreement. Further, neither Party shall have
any rights, power or authority to enter into any agreement or undertaking for or on behalf of, to act
as to be an agent or representative of, or to otherwise bind the other Party.
19. IMPLEMENTATION
Each Party shall promptly take such action (including, but not limited to, the execution,
acknowledgement and delivery of documents) as may be reasonably requested by the other Party
for the implernentation or continuing performance of this Agreement.
Page - 13 - UNIVERSITY OF IDAHO POWER PURCHASE AGREEMENT (STEAM)
20. NON.WAIVER
The failure of either Party to insist upon or enforce strict performance by the other Party of
any provision of this Agreement or to exercise any right under this Agreement shall not be
construed as a waiver or relinquishment of such Party's right to assert or rely upon any such
provision or right in that or any subsequent instance; rather, the same shall be and remain in full
force and effect.
2I. AMENDMENT
No change, amendment or modification of any provision of this Agreement shall be valid
unless set forth in a written amendment to this Agreement signed by both PartiesgOd_apgqved_by
the Commission.
22. CHOICE OF LAWS
This Agreernent shall be construed and interpreted in accordance with the laws of the State
of Idaho without reference to its choice of law provisions.
23. HEADINGS
The Section headings in this Agreement are for convenience only and shall not be
considered part of or used in the interpretation of this Agreement.
Page - 14 - UNIVERSITY OF IDAHO POWER PURCHASE AGREEMENT (STEAM)
24. SEVERABILITY
The invalidity or unenforceability of any provision of this Agreement shall not affect the
validity or enforceability of any other provision of this Agreement, and this Agreement shall be
construed in all respects as if the invalid or unenforceable provision were omitted.
25. COTINTERPARTS
This Agreement may be executed in two or more counterparts, each of which shall be
deerned as an original, and together shall constitute one and the same document.
26. TAXES
Each Party shall pay before delinquency all taxes and other governmental charges which,
if failed to be paid when due, could result in a lien upon the Facility or the Interconnection
Facilities.
27. NOTICES
Unless othe,nvise specified, all written notices or other communications required by or
provided under this Agreement shall be mailed or delivered to the following addresses, and shall
be considered delivered when deposited in the US Mail, postage prepaid, by certified or registered
mail or delivered in person:
to Avista:Director, Power Supply
Avista Corporation
P.O.Box3727
Spokane, WA 99220
to Seller:Director of Facilities
University of Idatro
875 Perimeter Drive, MS228l
Moscow,ID 83844-2281
Either Party may change its designated representative to receive notice and/or address
specified above by gving the other Party written notice of such change.
28. SURVTVAL
Rights and obligations which, by their nature, should survive termination or expiration of
this Agreement, will remain in effect until satisfied, including without limitation, all outstanding
financial obligations, and the provisions of Section 12 (Indemniff) and Section 16 (Dispute
Resolution).
Page - 15 - LTNIVERSITY OF IDAHO POWER PURCHASE AGREEMENT (STEAM)
29. ENTIRE AGREEMENT
This Agreement, including the following exhibits which are attached and incorporated by
reference herein, constitutes the entire agreonent of the Parties and supersedes all prior and
contemporaneous oral or written agreements between the Parties with respect to the subject matter
hereof.
Exhibit A Project Description and Point of Delivery
Exhibit B Communications and Reporting
Exhibit C-l Independent Engineering Certifications for Construction Adequacy for a
Qualifoing Facility
Exhibit C-2 lndependent Engineering Certifications for Ongoing Operations and
Maintenance for a Qualiffing Facility
Exhibit D Interconnection Agreement
30. Authoritv
In entering this Agreement, the Seller's representative is acting under delegated authority
under Board of Regents Policy V.I.
IN WITNESS WHEREOF, the Parties have caused this Agreernent to be executed by
their duly authorized representatives as of the date set forth below.
REGENTS OF TIIE I]NTVERSITY OF AVISTA CORPORATION
IDAIIO
Printed Name:_ By:
Title: Printed Name:
Date:Title:
Date:
Page - 16 - UNIVERSITY OF IDAHO POWER PURCHASE AGREEMENT (STEAM)
Exhibit A
Proiect Description and Point of Deliverv
Description of the Facility:
Seller's Facility is described as University of Idaho Micro-steam Turbine Installation and
consists of;
Three micro-steam turbine-generator sets, each designed to produce 275kW, for total
Facility design capacity of 825 kW
Turbine-generators senre to offset campus power needs as well as reducing the pressure
of steam from 170 psig down to 35 psig prior to campus distibution
Location:
Seller's Facility is located at the University of Idaho Energy Plant, at the northeast corner of 6ft
Street and Line Sfreet, Moscow,Idaho 83844.
Point of Deliverv: The Secondary terminals of the Transmission Provider's Distribution
Transformer(s) where the Seller's secondary conductors are connected.
o
Exhibit B
Communication and Reporting
(1) Email communications between Seller and Avista shall be submitted to:
Avista: @aistacorp.com;or
@avistacorp.com
Seller: j ohnsonb@uidaho. edu
Alternate: _ [e-mail]
(2) All oral communications relating to electic energy scheduling, generation level changes,
interruptions or outages between Seller and Avistawill be communicated on a-fecorded line as
follows:
(a) Pre-Schedule (5:30 am to 12:00 noon on Business Days):
Avista Pre-Scheduler: (509) 495 -491 I
Altemate Phone: [phone]
Seller: [phone]
Alternate Phone: [phone]
(b) Real-Time Schedule (available 24 hours a day)
Avista Real-Time Scheduler: [phone]
Seller: [phone]
Alternate Phone:
(3) Either Party may change its contact information upon written notice to the other Party
Exhibit C-l
Independent Eneineerine Certification for
Construction Adeouacv for a Oualifvins Facility
l. I, am a licensed professional engineer registered to
practice and in good standing in the State of_. I have substantial experience in the design,
construction and operation of elecfric power plants of the same type as
(Title of QF) sited at 1n
County, State of_ (the "Facility").
2. I have reviewed and/or supenrised the review of the construction in progress or of
the completed Facility and it is my professional opinion that said Facility has been designed and
built according to appropriate plans and specifications bearing the words *CERTIFIED FOR
ACCEPTANCE" and with the stamp ofthe certi$ing licensed professional engineer ofthe design,
and that the Facility was built to commercially acceptable standards for this type of facility.
3. I have no economic relationship to the designer or owner of said Facility and have
made my analysis of the plans and specifications independently.
4. I hereby CERTIFY that the above statements are complete, true, and accurate to the
best of my knowledge and I therefore set my hand and seal below.
Signed and Sealed
DATE:
SIGNATURE:
PRINTED NAME:
Exhibit C -2
Independent Engineerins Certification of Oneoins Operations and
Maintenance for a Oualifvine Facilitv
1. The undersigned is a duly authorized representative of inits
capacity asanindependent engineer(the "Independent Engineer"). The Independent
Engineer has substantial experience reviewing the design, construction, and operation
ofelectric power plants ofthe sametype as the University of Idaho's micro-steam turbine-
gorerator sets ("Facility").
2. Independent Engineer has reviewed the operation and maintenance agreement C'O&M
Agreement"') for the Facility and it is the Independent Engineer's professional opinion that,
provided the Facility has been designed and built to appropriate standards, the O&M
Agreernent is the same as the original O&M Agreement in place at COD, the is consistent
with Prudent Utility Practices (as defined in the Agreement) and therefore is considered
adequate to support the Facility's production of enerry in accordance with the requirements
of the Agreerrent, noting that the Independent Engineer makes no representation as to the
amounts of energy that will be produced by the Facility.
3. Independent Engineer has no economic relationship to the designer or owner of said Facility
and has made its analysis of the O&M Agreement independently.
4. Independent Engineer hereby confirms thatthe above statements are complete, true, and
accurate to the best of its knowledge.
Signed and Sealed
DATE
SIGNATURE:
PRINTED NAME:
Exhibit I)
Interconnection Aseement
The Parties acknowledee that Attachment 2 to the attached Interconnection Agreement states the
nameplate capaciw of the Facilitv is 1.050 kW. For pumoses of this Amended and Restated
Power Purchase Aereernent. the Parties agee that the Name,plate Capacitv Ratins of the Facility
is 825 kW Altemating Current (AC). as more fully described in Exhibit A.