20231002Application.pdf

Avista Corp.
1411 East Mission P.O. Box 3727
Spokane, Washington 99220-0500
Telephone [phone]
Toll Free 800-727-9170

October 2, 2023

Jan Noriyuki, Secretary
Idaho Public Utilities Commission
11331 W. Chinden Blvd. Bldg. 8, Ste. 201-A
Boise, Idaho 83714

RE: In the Matter of the Joint Petition of Avista Corporation and Clearwater Paper Corporation
for Approval of Amendment 1 to the Electric Service Agreement.

Included for filing with the Commission is the electronic copy of Avista Corporation and Clearwater
Paper Corporation’s Joint Petition.

Should you have any questions regarding this filing, please do not hesitate to call Michael Andrea at
[phone]. Thank you in advance for your assistance.

Sincerely,

/s/ Paul Kimball

Paul Kimball
Mgr. of Compliance & Discovery

Enclosures

CASE NO. AVU-E-23-15
RECEIVED
Monday, October 2, 2023 3:50:26 PM
IDAHO PUBLIC
UTILITIES COMMISSION
J1v1sr11·
Corp.
Michael G. Andrea (ISB No. 8308)
Senior Counsel
Avista Corporation
1411 E. Mission Avenue-MSC-17
Spokane, Washington 99202
Phone: [phone]
michael [e-mail]
Attorney for Avista Corporation
Michael S. Gadd
Senior Vice President & General Counsel
Clearwater Paper Corporation
601 W. Riverside Ave., Suite 1100
Spokane, Washington 99201
Phone: [phone]
Attorneys for Clearwater Paper Corporation
Peter Richardson
Richardson Adams, PLLC
505 N. 27'h Street
Boise, Idaho 83702
Phone: [phone]
BEFORE THE IDAHO PUBLIC UTILITIES COI\.IMISSION
IN THE MA TIER OF THE JOINT
PETITION OF A VISTA CORPORATION
AND CLEARWATER PAPER
CORPORATION FOR APPROVAL OF
AMENDMENTNO. l TOPOWER
PURCHASE AND SALE AGREEMENT
CASENO. AVU-E-23-_
JOINT PETITION
Avista Corporation ("Avista") and Clearwater Paper Corporation ("Clearwater")
(Avista and Clearwater are referred to collectively as the "Parties") hereby petition the Idaho
Public Utilities Commission ("Commission" or "IPUC") for an order approving the
Amendment No. 1 (" Amendment") to the Power Purchase and Sale Agreement between Avista
Corporation and Clearwater Paper Corporation ("2018 Agreement"). The 2018 Agreement
was originally approved by the Commission in Order No. 34242 issued on February 27, 2019.
The 2018 Agreement is due to expire by its terms on December 31, 2023. The Parties entered
into Amendment No. 1 to extend the tenn for an additional three years. If the Amendment is
JOINT PETITION OF AVISTA AND CLEARWATERPAPER-1
►
approved by the Commission, the 2018 Agreement will expire by its tenns on December 31,
2026. The Amendment is attached hereto as Exhibit I.
In support of this Petition, the Parties state as follows:
l. Avista is a corporation created and organized under the laws of the State of
Washington with its principal office in Spokane, Washington. Avista is an investor-owned
utility principally engaged in the business of providing electric and natural gas service in the
states ofldaho and Washington, as well as natural gas service in the state of Oregon.
2. Clearwater is a corporation that, among other things, operates a paper
manufacturing facility located jn Nez Perce County, Idaho (hereinafter referred to as the
"Facility").
3. Clearwater owns and operates a generation system at the Facility that is capable
of generating approximately 132.2 MV A of energy (the "Generation"). These generators are
Qualifying Facilities ("QF") pursuant to the Public Utility Regulatory Policies Act of 1978 and
18 C .F .R Part 292.
4. The underlying foundation of the 2018 Agreement is to allow Clearwater the
flexibility to optimize the value of its Generation and the associated REC value, while at the
same time ensuring that the Avista and its customers are held "neutral" as to whether
Clearwater generates into its own load or sells its full energy requirements to Avista. Under
the terms of the 2018 Agreement, Avista sells to Clearwater all of Clearwater's required energy
and capacity at the new Schedule 25P Block 2 PURPA rate of$24.50/MWh1 and purchases all
of the output from Clearwater's Generation, including the RECs, at the same PURP A rate of
1 The Parties agree Uial the Block 2 PURPA rate wiU be grossed up for revenue related e>qxmses associated with
Commission Fees in order to make the new agreement cost neutral for customers.
JOINT PETITION OF AVISTA AND CLEARWATER PAPER-2
►
$24.50/MWh. The 2018 Agreement also addresses the treatment of Clearwater's RECs, and
the sharing of the benefits from the sale of the RECs.
5. The essential terms of the 2018 Agreement, which are interrelated and
dependent upon each other, are explained in detail in the Joint Petition and Request for
Modified Period filed with the Commission in Case No. A VU-E-18-13. Except for the term
of the 2018 Agreement, those essential terms remain unchanged by Amendment.
6. To extend the term of the 2018 Agreement from December 31, 2023 to
December 31, 2026, the Amendment replaces Section 3(a) of the 2018 Agreement in its
entirety. As amended, Section 3(a) will provide as follows:
3(a) This Agreement, which originally became effective on February 27, 2019
("Effective Date") pursuant to Idaho Public Utilities Commission Order No. 34252,
shall terminate at 2400 hours on December 31, 2026, unless terminated earlier
pursuant to this Agreement. As of the Effective Date and continuing while this
Agreement is in effect, this Agreement shall suspend the 2013 Agreement. Upon the
termination or suspension of this Agreement December 31, 2026, the 2013
Agreement shall come back into effect. All obligations incurred under the 2013
Agreement prior to suspension shall survive until satisfied. Notwithstanding anything
to the contrary in the 2013 Agreement, in the event that the 2013 Agreement comes
back into effect pursuant to the terms of this Agreement, the 2013 Agreement shall be
effective from the date it comes back into effect until the earlier of (i) December 31,
2026, or (ii) the date upon which the Parties enter into a new agreement regarding the
output of the Project. Notwithstanding anything in this agreement, this Section 3(a)
shall survive termination of this Agreement.
7. In order to extend the term of the 2018 Agreement, Avista also needed to extend
the associated REC Agreement,2 which is attached to the 2018 Agreement as Exhibit F .
Accordingly, the Amendment also replaces the first sentence of Section 5(a) of the 2018
Agreement to acknowledge the amendment to extend the associated REC Agreement as
follows:
2 REC Agreement has the meaning provided in the 2018 Agreement.
JOINT PETITION OF AVISTA AND CLEARWATER PAPER-3
S(a) Oearwater acknowledges that Avista bas entered into the REC Agreement,
attached hereto as Exhibit F, as amended by Amendment No. I to such REC
Agreement.
The amendment to the REC Agreement is attached to the Amendment as Attachment A.
8. Except for the amendments to Sections 3(a) and 5(a) of the 2018 Agreement
discussed herein, all other terms of the 2018 Agreement remain unchanged and shall continue
in full force and effect through December 3 l, 2026.
WHEREFORE. Avista and Clearwater respectfully request that the Commission issue
an order:
(I) approving the Amendment to extend the tenn of the 2018 Agreement for an
additional three years so that the 2018 Agreement will expire on December 31,
2026.
(2) direct Avista to file a revised Schedule 25P, substantially in the form of that
included in Exhibit B to the 2018 Agreement, in compliance with the
Commission's order approving this Joint Petition to effectuate the terms of the
Amendment to the 2018 Agreement.
(3) processing this Joint Petition under the rules providing for Modified Procedure.
,r
'i}. ,..j (Jc ~b~ r
DATED this ~y of~ 2023. --,,.....
Clearwater Paper Corporation Avista Corporation
Sign~---~
Nam6~\e.. \J...~~M
Signawre~_{)
Name: ['1; ul ll t. / ,,(/,,n:,ft-l-..4.
Date: ct/~l '1..~ ~ Date: IO fJ. / :2.c, 2 J t I
JOINT PETITION OF AVISTA AND CLEARWATER PAPER-4