20181206Plaintiff Response to IPC 47.pdf

Peter J. Richardson, ISB# 3195
515 N. 27th Street
Boise, Idaho 83702
Telephone [phone] I
Facsimile: (208) 938-7 904
Attorney for Plaintiffs
Robert C. Huntley, ISB# 2188
R. HUNTLEY LAW, PLLC
815 West Washington Street
Boise, ID 8701
Telephone (208) 388- I 230
Facsimile: [phone]
Attomey for Plaintiffs
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF IDAHO
Case No.: 1 : 1 8-cv-00236-REBFRANKLTN ENERGY STORAGE ONE, LLC,
FRANKLIN ENERGY STORAGE TWO, LLC
FRANKLIN ENERGY STORAGE THREE,
LLC, FRANKLIN ENERGY STORAGE
FOUR, LLC PLAINTIFFS' RESPONSE BRIEF TO
IDAHO POWER'S MOTION FOR
SUMMARY JUDGMENT
and,
Plaintiffs,
VS
PAUL KJELLANDER, KRISTINE RAPER
ERIC ANDERSON, in their official capacity as
Commissioners of the IDAHO PUBLIC
UTILITIES COMMISSION,
Defendants,
IDAHO POWER COMPANY,
Defendant-lntervenor
TABLE OF CONTENTS
I. Introduction
II. The Idaho Commission Impermissibly Intruded Upon
Franklins' Response Brief to Idaho Power's Motion for Summary Judgment
t.
Case 1:18-cv-00236-REB Document 47 Filed 11/30/18 Page 1 of 21
FERC's Exclusive Jurisdiction to Determrne
Status..
The IPUC Exceeded its Jurisdiction by Impermissibly Determining Plaintiffs'
Qualified Facility QF
Status.
The IPUC's Decision Unilaterally and Permanently Eliminates the Entire Class of
Energy Storage QFs from Eligibility Under PURPA. ............7
III. Neither Collateral Estoppel nor the Statute of Limitations are Applicable Because the
Idaho Commission had no
Jurisdiction
A. Collateral Estoppel and Limitations of Actions Arguments are
lnapposite....9
B There is no Analogous State Statute of
Limitations ...10
IV
I
A.
B
I
9
Entitlement to a Twenty-Year
Contract.
V. Conclusion
TABLE OF AUTHORITIES
CASES
Allco Renewable Energy Ltd. V. Mass. Elec. Co.,875 F.3d 64 (l't Cir.2017).
Exelon Wind, I, LLC v. Nelson, 766 F.3d 380 (5th Cfu.2014).
Johnson v. Idaho Cent. Credit Union, 127 ldaho 867, 908 P.2d 560
.. ..14
t6
Greenwood v. N.H. PUC, 527 F.3d 8 (l$ Cir.
2008).
Indep. Energt Prods. Ass'n, Inc. v. Cal. Pub. Utils. Comm'n,36 F.3d 848, 859 (9th Cir
1994....
T4
..14
(lee5).
Franklins' Response Brief to Idaho Power's Motion for Summary Judgment
ii.
.....t2
Case 1:18-cv-00236-REB Document 47 Filed 11/30/18 Page 2 of 21
Luz Dev. and Fin. Corp.,5l FERC tl 61,078
(leeO).986543
McCoy v. State, Dep't of Health & Welfare, 127 Idaho 792, 907 P.2d 1 10
(1ee5)..t2
New York State Electric and Gas Corporation v. Sarnace Power Partners,l lT F. Supp.
2d 2tt (D.NY 2000). . .. . . .. I l
Sierra Live Insurance Co. v. Granata,99(daho 624
(1e78).......10
State v. Heyrend, 129 Idaho 568
(1ee6)...l0
University of Utah Hosp. v. Board of Commr 's, 128 Idaho 529,915 P.2d 1387
(1ee6).
STATUTES
l6 U.S.C. 82aa-3(b). (PURPA Section 210(b))..
16 U.S.C. 82aa-3(f) (PURPA Section 210(Ð)....
l6 U.S.C. 824a-3(h) (PURPA Section 210(h))
Idaho Code $ 5-201 et.
seq
Idaho Code Title 5,Chapter2.
Idaho Code $ 5-201
Idaho Code 5-224
RULES
Idaho Rule of Civil Procedure 2.
Idaho Rule of Civil Procedure 3(a).
OTHER
Franklins' Response Brief to Idaho Power's Motion for Summary Judgment
iii.
16 U.S.C. 824a-3(a). (PURPA Section 210(a)). ......14
t2
t4
t4
l3
ll, 12
1l
t2
11
..12
..12
Case 1:18-cv-00236-REB Document 47 Filed 11/30/18 Page 3 of 21
Restatement (2d) of Conflict of Laws, $97(d)
Franklins' Response Brief to Idaho Power's Motion for Summary Judgment
.. l0
IV
Case 1:18-cv-00236-REB Document 47 Filed 11/30/18 Page 4 of 21
I
INTRODUCTION
Plaintiffs respectfully lodge this Response Brief to Defendant / Intervenor Idaho Power
Company's Motion for Summary Judgment and its Memorandum in Support of Motion for
Summary Judgment. Idaho Power raises just three issues upon which it seeks summary judgment
- (l) statute of limitations; (2) collateral estoppel and (3) the jurisdiction of the Idaho Public
Utilities Commission's determination of Franklins' QF status. Franklin will address these issues
in reverse order because the Idaho Commission's determination of the Franklin projects' QF status
is extra-jurisdictional to the Idaho Commission's authority and hence, the statute of limitations
and collateral estoppel arguments necessarily fail as a result.
II.
THE IDAHO COMMISSION IMPERMISSIBLY INTRUDED ON FERC's EXCLUSIVE
JURISDICTION TO DETERMINE QF STATUS
A The IPUC Exceeded Its Jurisdiction b)¡ Impermissibl)¿ Determining Plaintiffs' Oualif,red
Facility Status
All parties, Idaho Power included, agree that FERC has "exclusive jurisdiction over QF
status.l" Indeed, according to Idaho Power, the IPUC's decisions in this matter "assume[d]
Plaintiffs QF status ... in [its] ruling."2 Although what assumptions were in the minds of the
Defendant Commissioners when they issued their rulings are beyond Franklins' ability to discern,
the Commissioners' decisions speak for themselves. Despite the Power Company assertions that
the QF status of the Franklin Projects was not at issue before the IPUC3, this proffered recognition
of FERC's exclusive jurisdiction was not, in fact, honored by the IPUC in its decisions. By
reclassifying them as solar QFs, the IPUC's ruling refused to recognize Franklins' rights granted
I "Idaho Power Memorandum Dkt no. 39-1, at p. I
2 Id.
3 Id. atp. 14.
Franklins' Response Brief to Idaho Power's Motion for Summary Judgment -- I
Case 1:18-cv-00236-REB Document 47 Filed 11/30/18 Page 5 of 21
to them under PURPA by virtue of their status as energy storage QFs. Indeed, the IPUC decision
denies the very existence of energy storage QFs by impermissibly reclassifying all energy storage
systems based on the dominant energy input to the storage system.
Rather than yielding to ("assuming") FERC's jurisdiction as to the energy storage QF status
of the Projects, the Idaho Commission explicitly ruled that for purposes of "eligibility under
PURPA" the projects will be treated as "solar" QFs.o The Idaho Commission's purported
acquiescence to FERC's jurisdiction relative to QF status is nothing more than a façade designed
to mask its intrusion into an arena reserved exclusively to the FERC. The very (and explicit)
foundation of the IPUC's decision is based on its refusal to defer to FERC's jurisdiction by refusing
to recognize the energy storage QF status of the Franklin projects.
The most relevant FERC decision addressing the QF status of energy storage projects is
Luz Dev. and Fin. Corp.,51 FERC 1161,078 (1990)5 in which FERC unequivocally declares that
energy storage projects are QFs distinct from the nature of the renewable energy input to the
storage system. Idaho Power's Memorandum relies on Luz to support its contention that the ldaho
Commission may look to the "primary energy source for the Plaintiff s battery storage facilities"
in determining "which rates and [contract] terms Plaintiffs were eligible for."6
Idaho Power's quotes in support of its argument are deceptively out of context.T Idaho
Power's quote from Luz is reproduced in its entirety below:
[T] primary energy source of the battery system is not the electrochemical reaction. Rather,
it is the electric energy which is utilized to initiate that reaction, for without that energy,
the storage facility could not store or produce the electric energy which is to be delivered
at some later time. Since this energy is the primary energy source of the facility, it is
4 PUC original Order. Order No. 33785 at pp. 1l - 12. See Dkt. no. 40-5, page 40.
5 Pagination references to Luz herein are to the original FERC order.
6 Idaho Power Memorandum at pp. l4 - 15.
7 A quote out of context, of course, is based on a decision to exclude from the excerpt ceftain
nearby phrases or sentences that serve to clarify the intentions behind the selected words.
Franklins' Response Brief to Idaho Power's Motion for Summary Judgment -- 2
Case 1:18-cv-00236-REB Document 47 Filed 11/30/18 Page 6 of 21
necessary to look to the source of this energy as the ultimate primary energy source of the
facility.8
The remainder of the passage from Idaho Power's partial quote (the parts that Idaho Power chooses
to ignore) makes clear that regardless of the magnitude and regardless of the composition of
renewable energy input(s) to a storage facility, the storage facility is nevertheless a OF. The
remainder of the out-of-context paragraph Idaho Power quotes makes this point abundantly clear:
As the Conference Report makes no distinction with regard to the primary energy source
of a storage facility as opposed to a conventional small power production facility, then in
order for a storage facility to be a QF the primary energy source for generation of this
energy must be one of those contemplated by the statute for conventional small power
production facilities, e.g., biomass, waste, renewable resources, geothermal resources or
any combinøtion thereof. Likewise, the use of oil, natural gas or coal must be limited as
required by the statute and our regulation...e
While declaring that Luz, supra was not a QF for a reason irrelevant to our analysis (because of its
unrestrained use of non-renewable inputs), FERC explicitly declared that energy storage facilities
such as the one proposed by Luz are QFs, albeit with the caveat that their energy inputs must be
primarily renewable:
In sum, energy storage føcilities such as the proposed Luz battery system are a renewable
resource for purposes of QF certification. However, such facilities are subject to the
requirement that the energy input to the facility is itself biomass, waste, a renewable
resource, a geothermal resource, or any combination thereof...10
FERC could not have been more explicit in declaring an energy storage system is "a renewable
resource for pumoses of OF certification." The obvious fact that an energy storage system is
distinct from its energy input is made even more evident by the fact that FERC allows for any
"combination" of renewable energy inputs to the storage system that comprises the QF. Thus, an
energy storage QF may input energy equally, and simultaneously, from solar, wind, biomass and
8 Luz supra. Quoted atp.4 of the Power Company's Memorandum.
e Id. Emphasis provided.
t0 Id. at pp. l0 - I l. Emphasis provided.
Franklins' Response Brief to Idaho Power's Motion for Summary Judgment -- 3
Case 1:18-cv-00236-REB Document 47 Filed 11/30/18 Page 7 of 21
geothermal and would not be considered a solar, wind, biomass or geothermal QF, but would still
be deemed an energy storage QF by FERC. Likewise, if the energy storage QF utilizes 55% input
from wind and 45o/o input from solar it would not be deemed a wind QF, nor would it be deemed
a solar QF, but it would still be an energy storage QF. In the case of the Franklin energy storage
QFs, the initial design contemplates 100% solar input. However, the percentage of solar input
(versus any other renewable energy input - or even no other renewable energy input) is irrelevant
as to its status as a FERC approved energy storage QF. According to FERC, as the QF status as
energy storage system is independent of the mix or magnitude of renewable energy inputs to the
storage system. It is important to this analysis that all parties, the Power Company included,
concede that FERC has exclusive jurisdiction over QF status. Thus, FERC's ruling that a storage
facility is a QF regardless of the mix of renewable energy inputs to the facility should have been
the controlling factor in the Idaho Commission's ruling.ll
FERC makes it clear that the identity and/or magnitude of any particular renewablel2
energy input is wholly irrelevant as to the QF status of an energy storage QF facility. Contrary to
a commonplace understanding of the word "primary", FERC's use of that word in the phrase
"primary energy source" does not mean a single dominant energy source - it is in fact, a term of
art. According to FERC, "primary energy source" means "any combination" of renewable energy
sources such as a mix of biomass, waste, wind, solar, tidal and/or geothermal resources. There is
no first among equals when it comes to FERC's determination of "primary energy source." If the
rr The Applicant in the Luz decision was planning on charging its battery system with
undifferentiated electric power from the local utility grid and was thus unable to demonstrate that
the energy input to the battery was renewable. FERC therefore denied the applicant's request for
at2
F status.
This is true as long as the combined energy input from any combination of renewable sources
comprise the primary energy input to the battery storage QF
Franklins' Response Brief to Idaho Power's Motion for Summary Judgment -- 4
Case 1:18-cv-00236-REB Document 47 Filed 11/30/18 Page 8 of 21
inputs to the storage facility are renewable, there is no hierarchy (and no need) to determine which
one of the many possible renewable energy sources stands out above the others.
Contrary to FERC's definition of the phrase, the Idaho Commission has, by default, re-
defined the phrase "primary energy source" to mean the single dominant energy source. It then
used its new default definition to determine the QF status of the Franklin projects. However, the
Idaho Commission's redefined term is wholly contrary to the FERC's determination of a facility's
OF status. V/hether the majority þrimary) energy input to the storage facility is solar, wind,
geothermal, biomass or waste is irrelevant to its QF status as long as the energy inputs are
renewable energy inputs. There is no place in FERC's exercise of its exclusive jurisdiction over
QF status to parse the inputs in the manner in which the IPUC has parsed them.
Thus, rather than "assuming" FERC jurisdiction over the QF status of the Franklin QFs,
the IPUC actually usurped that jurisdiction by inquiring into the project's dominant energy source
to "determine [its] eligibility to particular avoided cost rates and contract terms.r3" That function,
of course is exclusively FERC's.
In its analysis of the applicant's QF status in Luz, supra FERC did inquire into the energy
inputs to the storage system, but only to determine whether those inputs were primarily renewable
in nature. It rejected Luz' claim that non-renewable energy inputs to the storage system are
irrelevant to the FERC's determination of its QF status. Luz had argued that energy storage
facilities should be certified as QFs regardless of their proposed non-renewable energy inputs.
FERC disagreed and ruled that in order for an energy storage facility to be certified as a QF its
"primary energy source" must be any combination of renewable energy inputs. In doing so FERC
ruled that:
13 PUC Order on Reconsideration. Order No. 33858 at p. 3. See Dkt. no.4-7.
Franklins' Response Brief to Idaho Power's Motion for Summary Judgment -- 5
Case 1:18-cv-00236-REB Document 47 Filed 11/30/18 Page 9 of 21
Contrary to Luz's assertion, the primary energy source of the battery system is not the
electro-chemical reaction. Rather, it is the electric energy which is utilized to initiate that
reaction, for without that energy, the storage facility could not store or produce the electric
energy which is to be delivered at some later time. Since this energy is the primary energy
source of the facility, it is necessary to look to the source of this energy as the ultimate
primary energy source of the faciliry.l4
FERC therefore exercises its exclusive jurisdiction to ensure that the primary energy inputs
to an energy storage facility are renewable in order to certify its status as a QF. Once QF status is
confirmed by FERC, a state PUC is precluded from making independent inquiries into that
facility's eligibility for the benefits conferred on it by PURPA.T5 Simply put, "What the state may
not do, however, is to intrude into the Commission's IFERC] exclusive jurisdiction to make QF
status determinations by denying to certified QF the full avoided cost rates to which they are
entitled."l6 Which is exactly what the Idaho Commission has done here.
Thus, when FERC declared that "it is necessary to look to the source of this energy" it was
referring to FERC's responsibility to make that inquiry ("look") and not the Idaho PUC's
responsibility to make that inquiry ("look"). But, "look," and act based on that "look," is exactly
what the Idaho PUC did. The Idaho Commission was explicit in its usurpation of FERC's
responsibility to make QF eligibility determinations:
FERC conf,rrmed that energy storage facilities are not renewable resources/small power
production facilities per se. Id. fCiting to Luzf Electric input is required to produce electric
output from a storage facility [citation omitted] For this reason, in order to qualify as a PURPA
resource, the primary energy source behind the battery storage must be considered. We lthe Idaho
PUCI must. then. look to Franklin's and Black Mesa's primarlr energ)¡ sources in order to determine
their eligibilit]¡ under PURPA.'7
The Idaho Commission presumed the responsibility to "look to the primary energy source" rather
than deferring (as it must) to FERC's responsibility to make that inquiry in order to determine a
Ia Luz supra at p. 8.
15 Indep. Energy Prods. Ass'n, Inc. v. Cal. Pub. Utils. Comm'n,36 F.3d 848, 859 (9th Cir. 1994)
t6 Id.
17 PUC original Order. Order No. 33785 at p. I l. See Dkt. No. 40-5,page 40.
Franklins' Response Brief to Idaho Power's Motion for Summary Judgment -- 6
Case 1:18-cv-00236-REB Document 47 Filed 11/30/18 Page 10 of 21
project's eligible status as a QF. In doing so, the IPUC explicitly usurped the role Congress has
reserved to FERC in order for it to deny the Franklin Projects' their right to twenty-year PURPA
contracts at published rates. The Idaho Commission has no role in making any determination as to
a project's "eligibility under PURPA." That role is exclusively FERC's responsibility.ls The
Idaho Commission's explicit admission that it "must determine their fFranklin's] eligibility under
PURPA" thus contradicts Idaho Power's assertion that the PUC "assume[d] Plaintiffls QF status"re
and it is contrary to PURPA. The Idaho Commission had no jurisdiction to make any finding
relative to the Franklin projects' "eligibility under PURPA."
B. THE PUC,s DECISION LINILATERALLY AND PERMANENTLY ELIMINATES THE
ENTIRE CLASS OF ENERGY STORAGE OFs FROM ELIGIBILITY I.INDER PURPA
The Ninth Circuit Court's decision in Independent Energy Producers Ass'n recognizes the
"need for [a] uniform federal authority over the determination of QF status,"2O Allowing the Idaho
Commission to usurp FERC's exclusive authority over QF status determinations will surely result
in a balkanizationof energy storage QFs' status across the country. If the Idaho PUC can reclassify
energy storage QFs as solar then what is to prevent other states from applying an entirely different
classification scheme to energy storage QFs? PURPA's uniformity goal is thus thwarted by
allowing Idaho to step in and determine "eligibility under PURPA" as it explicitly did here.
So far, the Idaho Commission stands alone2l among the states in eliminating energy storage
QFs from eligibility as a PURPA resource. However, by ruling that an energy storage QFs' status
shall be based on the Idaho PUC's determination of the dominant energy input, the ldaho PUC
t8 Independent Energlt Producers Ass'n v. California Pub. Utils Comm'n, supra, at p. 859
(tee4).
le Idaho Power Memorandum at p. l.
20 Independent Energy Producers Ass'n supra at fn. 11.
2l Plaintiffls research failed to identify any similar state commission orders.
Franklins' Response Brief to Idaho Power's Motion for Summary Judgment -- 7
Case 1:18-cv-00236-REB Document 47 Filed 11/30/18 Page 11 of 21
actually refused to recognize the very existence of energy storage QFs as a distinct class of QF
which is directly contrary to FERC's holding in Luz.
As discussed above, the Idaho Commission consistently misuses the phrase "primary
energy source" in all of its orders by confusing FERC's definition of the term with its own
comrption of the phrase which it incorrectly believes means a determination of the single dominant
energy source for purposes of "eligibility" under PURPA. FERC, as discussed above, uses the
phrase "primary energy source" to mean "any combination" of renewable energy sources. It does
not use the phrase "primary energy source" to mean a single dominant renewable energy source.
Simply put, it does not use the word "primary" as that word is commonly understood - which may
help explain the IPUC's confusion.
Although having claimed to defer to the FERC's exclusive jurisdiction to make QF
determinations, through its misuse (misunderstanding) of the term of art "primary energy source,"
the Idaho Commission then impermissibly reclassifies all energy storage QFs based on their
underlying energy input. In doing so, the Idaho Commission ignores the fact that the only interface
between Franklin and Idaho Power is the delivery of electricity stored in the battery to the grid.
The Idaho Commission's original order provides:
We must, then, look to Franklin's and Black Mesa's primary energy sources in order to
determine their eligibility under PURPA. The primary energy source for Franklin and
Black Mesa is solar generation. . . . Accordingly, we find it appropriate to base Franklin's
and Black Mesa's eligibility under PURPA on its primary energy source - solar. Solar
resources ... are entitled to negotiate two-year PURPA contracts through the use of Idaho's
IRP methodology.22
The Idaho PUC, thus, in open defiance of FERC, refuses to recognize the very existence of energy
storage QFs. Its declared policy of looking to the "primary energy sources in order to determine
22 PIJC Original Order, Supra. at p. I I - 12.
Franklins' Response Brief to Idaho Power's Motion for Summary Judgment -- 8
Case 1:18-cv-00236-REB Document 47 Filed 11/30/18 Page 12 of 21
their eligibility under PURPA" will result in the elimination of all energy storage QFs because qll
energ)/ storage QFs have some form of energy input that is independent from the storage system
itself. Thus, the IPUC has effectively eliminated energy storage systems as a distinct class of QF
- which ruling directly contravenes FERCs declaration that "energy storage facilities . . . are a
renewable energy resource for purposes of QF certification.''23 The Idaho Commission's
declared policy is to ignore the status of the Franklin projects as energy storage QFs and instead
make its own (illegal) determination of the facilities' "eligibility under PURPA" based on the
dominant energy input.
In short, the Idaho Commission exceeded its jurisdiction in its attempt to step into the shoes
of FERC by inquiring into the energy source of the Franklin projects in order to "determine their
eligibility under PURPA" and Idaho Power's Motion for Summary Judgment should be denied on
this basis alone.
III.
NEITHER COLLATERAL ESTOPPEL NOR THE STATUTE OF LIMITATTONS ARE
APPLICABLE BECAUSE THE COMMISSION HAD NO JURISDICTION
A. Collateral Estoppel and Limitations of Actions Areuments are Inapposite
All parties to this proceeding agree that the Idaho Commission does not have jurisdiction
over QF status and that such determinations are made exclusively by the Federal Energy
Regulatory Commission.2a As explained above, the Idaho Public Utilities Commission, which
does not have subject matter jurisdiction over the QF status of the Franklin projects, intruded into
FERC's exclusive jurisdictional arena by actually determining the Franklin projects' "eligibility
under PURPA."25 Thus, the Power Company's claims that the concepts of res judicata (issue
23 Luz, supra at pp. 10 - 1 l. Emphasis provided.
2a Response atp.17.
2s PUC original Order. Order No. 33785 at p. I l. See Dkt. No. 40-5, page 40.
Franklins' Response Brief to Idaho Power's Motion for Summary Judgment -- 9
Case 1:18-cv-00236-REB Document 47 Filed 11/30/18 Page 13 of 21
and/or claims preclusion) must fail.26 Likewise any claimed statute of limitations must fail if the
tribunal issuing the order in question lacks jurisdiction. It is black letter law that a decision by a
tribunal lacking jurisdiction is entitled to none of the post decisional protections typically afford
a tribunal's decision with legitimate jurisdiction. Thus, concepts such as res judicata, claims
preclusion and/or issue preclusion and statute of limitations are irrelevant. As the Idaho
Supreme Court instructs:
The issue of whether a court has exceeded its subject matter jurisdiction is never waived
and purported judgments entered by that court, acting without subject matter jurisdiction,
are void and subject to collateral attack.21
And
The defense of lack of subject matter jurisdiction is never waived.28
Because the Idaho Commission has improperly intruded into a subject area reserved exclusively
to the FERC, and has hence exceeded its subject matter jurisdiction, Franklin is free to challenge
that decision in any tribunal with legitimate jurisdiction and may do so at any time.
B. There is no Analosous State Statute of Limitations
The Idaho Commission's lack of subject matter jurisdiction lays the questions of res
judicata and the applicability of a statute of limitations to rest. In addition, however, Idaho Power's
misplaced claim relative to the applicability of an "analogous" statute of limitations is so out of
left field that it deserves a brief mention. The Power Company contends that because Plaintiff s
did not appeal the IPUC's Orders in state court, they cannot now sustain this action for enforcement
26 Furthermore, the Restatement (2d) of Conflict of Laws, $97(d) provides that the very concept
of res judicata and collateral attack are not applicable when application of such rules would
"conflict with an important federal policy." PURPA certainly qualifies as an important federal
policy.
27 State v. Heyrend,l2g Idaho 568,571 (1996).
28 Sierra Live Insurance Co. v. Granatq 99 Idaho 624,626-27 (1978).
Franklins' Response Brief to Idaho Power's Motion for Summary Judgment -- l0
Case 1:18-cv-00236-REB Document 47 Filed 11/30/18 Page 14 of 21
of PURPA under Section 210(h) of PURPA. This argument is without legal foundation because
the time for appeal to the ldaho Supreme Court from an adverse IPUC decision is not based on a
statute of limitation.
The Idaho Statutes of Limitation are found in Idaho Code Title 5, Chapter 2, commencing
with 5-201. Defendants point to no statute therein which applies to this case. They are required
to do so under notice pleading, but cannot do so because none exists. The catch-all "all other"
section, I.C.5-224 provides for four years, not 42 days.
The Power Company relies on a general statement of law from New York State Electric
and Gas Corporation v. Sarnace Power Partners,llT F. Supp. 2d211 (D.NY 2000)2e which
recites the default principle that if a federal statute contains no statute of limitations a court should
"apply the most analogous statute of limitations in the state where the action is brought."30
Because PURPA contains no statute of limitations, in order to apply this principle one must
therefore discem the most "analogous" Idaho statute of limitations. Idaho Power simply assumes
(with no legal analysis whatsoever) that the time limitation for lodging an appeal to the Idaho
Supreme Court from an adverse IPUC ruling is the "analogous" Idaho statute of limitations.
According to Idaho Power, the Idaho Appellate Rules which provide that appeals from the PUC's
order must be lodged with the Idaho Supreme Court within 42 days is a "limitations period."sl
Contrary to the Power Company's assertion, the time for lodging an appeal from an adverse state
agency decision in Idaho does not implicate the state's Statutes of Limitation.
2e Response to Plaintiffls Motion for Summary Judgment at p
Company's Response.")
30 Greenwood v. N.H. PUC 527 F.3d 8, l2 (1't Cir. 2008).
3l Idaho Power Memorandum at p. 10.
I 0. (Hereinafter "Power
Franklins' Response Brief to ldaho Power's Motion for Summary Judgment -- l l
Case 1:18-cv-00236-REB Document 47 Filed 11/30/18 Page 15 of 21
The time period in which an appeal from an adverse agency action in Idaho is not a "statute
of limitation." Statutes of limitations in Idaho are codified at Idaho Code $ 5-201 et. seq.,
"Limitation of Actions"). Section 5-201of that Statute provides that:
Civil actions can only be commenced within the periods prescribed in this chapter after the
cause ofaction shall have accrued. . .
Idaho Rule of Civil Procedure 2 provides
There shall be one form of action to be known as "civil action."
Idaho Rule of Civil Procedure 3(a) provides:
A civil action is commenced by the filing of a complaint with the court, which may be
denominated as a complaint, petition or application, and the party f,rling the same shall be
designated as the plaintiff or petitioner, and any party against whom the same is filed shall
be designated at the defendant or respondent.
The Idaho Supreme Court has consistently ruled that an appeal from an adverse agency decision
to the Idaho Courts is not the commencement of a civil action that tolls the statute of limitations.
McCoy v. State, Dep't o/'Health & Welfare 127 Idaho 792,907 P.2d I l0 (1995), Johnson v. Idaho
Cent. Credit Union 127 Idaho 867,908 P.2d 560 (1995), University of Utah Hosp. v. Board of
Commr 's 128 Idaho 529,915P.2d 1387 (1996). Thus, the onlywayto'toll'the ldaho Statute of
Limitations is to timely commence a "civil action..." Because an appeal from an adverse
administrative agency's decision does not constitute the commencement of a "civil action" it is in
no way "analogous" (or even related) to the ldaho Statute of Limitations. The 42 day window in
which to lodge an appeal from an adverse IPUC decision is not a statute of limitation.
It is not necessary to attempt to discern which of the multiple Idaho statutes of limitation would
be analogous because ALL of the Idaho statutes of limitation provisions are longer than the time
period in which Plaintiffls brought this action before FERC.
Franklins' Response Brief to Idaho Power's Motion for Summary Judgment -- 12
Case 1:18-cv-00236-REB Document 47 Filed 11/30/18 Page 16 of 21
The fact that an appeal from an adverse agency decision does not implicate any Idaho Statute
of Limitations, is not the only reason such deadline fails to constitute an "analogous" statute of
limitations. The time for appeals itself obviates any claim that it is analogous to a valid statute of
limitations because it is impossible to comply with the state appeals rule and also seek redress
from FERC pursuant to Section 201(h)32 of PURPA. Section 201(h) of PURPA requires a plaintiff
to first give FERC the opportunity to initiate its own enforcement action against a state PUC before
the Plaintiff may do so in its own name. In short, Section 201(h) allows the FERC to enforce the
Plaintiff s PURPA implementation rights in federal court. FERC has 60 days in which to respond
to a request by a qualifying facility to declare whether or not it intends to initiate an enforcement
action against a state for failure to implement PURPA. If it declines, then the qualifying facility
can stand in the shoes of FERC by initiating its own enforcement action against the state in federal
court. Given these incompatible time deadlines, under the Power Company's analysis, it would
be impossible for a QF to ever initiate an enforcement action against the Idaho PUC because the
42 day Idaho rule will lapse before the 60 day time period in Section 201(h) of PURPA will lapse.
The Idaho 42 day appeals window is thus also not an "analogous statute of limitations" because it
is impossible to comply with the Idaho deadline and FERC's enforcement scheme. An analogous
statute of limitations provision in state law would obviously not be one that v voids. aå
ini tio. the federul claim.
Furthermore, nothing in Section 210(h) requires that a QF seek state judicial review of a
public utilities commission order before petitioning the FERC to enforce PURPA. Section
210(h)(2)(a) of PURPA permits the Commission to initiate an enforcement action against a state
regulatory authority for failure to implement PURPA regulations, and Section 210(h)(2)(b) of
32 l6 u.s.c. 824a-3(h).
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PURPA permits QFs, such as Plaintiff s, to petition the FERC to initiate such an enforcement
action against a state regulatory authority. As noted above, if the FERC does not initiate an
enforcement action against the IPUC with 60 days of flrling the Petition, plaintiff s have the right
to bring an action in the appropriate Untied States district court to require a state commission to
comply with the FERC's regulations, and the court may issue such injunctive or other relief as
may be appropriate. A QF's decision to go forward with enforcement after a state commission has
declined to do so is legally the same as a FERC enforcement, that is the QF stands-in-the-shoes of
the FERC for enforcement purposes.
IV.
ENTITLEMENT TO A TWENTY YEAR-CONTACT
The Power Company, in the heading of the concluding section of its Memorandum, asserts
that PURPA does not entitle the Franklin projects to any specific rate or term.33 The Power
Company goes on to claim that the "only thing that Plaintiffs are "entitled" to as self-certified QFs
under PURPA is the triggering of its IPURPA's] provisions mandating that Idaho Power agree to
purchase Plaintiff s power at'Just and reasonable rates" that do not exceed the "incremental cost
to fldaho Power] of altemative electric energy."34 The Plaintiff s agree that the Idaho Commission
has established avoided cost rates that are just and reasonable and that do not exceed the
incremental cost of altemative electric energy for two classes of QFs (wind/solar and "all other").
Plaintiffs are not challenging the establishment of those rates or the contract terms associated with
those rates as they apply to those two distinct classes of QFs.
The consequence to Idaho Power of the IPUC's proper implementation of PURPA will
naturally flow from that action. Thus, the Power Company is correct in its assertion that "If this
33 Idaho Power Memorandum at p. 16. (Dkt. no. 39-1
34 Id.
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Court agrees with Plaintiffs and issues the requested declaratory relief and/or injunction, the terms
under which Idaho Power must contract with Plaintiffs will be significantly altered. lto wit:l 20-
year contracts with ldaho Power using published avoided cost ratss."35
Idaho Power states the obvious in that, "the setting of this rate favoided cost rate], is left to
the IPUC, as is the determination of the length of any contract and other terms thereof."36 It
concludes, however, that "neither PURPA or FERC's regulations entitle them fPlaintiffs] to 20-
year contracts with Idaho Power at standard avoided cost rates."37 Again Idaho Power obfuscates.
Plaintiff s have never contended, and do not now, that PURPA or FERC requires any specific
contract term or that FERC sets the standard avoided cost rates. The IPUC's role under PURPA
and FERC's regulations is to make those determinations, and it has done so. Plaintiff s sole
contention is that the IPUC has attempted to avoid the natural result of its rate setting methodology
(2}-year contract terms at published avoided cost rates for all QFs other than wind or solar) by
intruding into FERC's exclusive jurisdiction to make QF eligibility determinations. The only
cases3s cited by the Power Company in support of its final argument make clear that the Plaintiff s
claims against the IPUC are well placed:
Section 210(a) of PURPA directed the Federal Energy Regulatory Commission ("FERC")
to promulgate rules mandating that electric utilities purchase energy from QFs. l6 U.S.C.
$ 824a-3(a). Those rules, section 210(b) specified, were not to "provide for a rate which
exceeds the incremental cost to the electric utility of altemative energy." Id. $ 824a-3(b).
... In accordance with this directive, FERC promulgated regulations requiring utilities to
purchase electricity from QFs "at a rate equal to the utility full avoided cost." [citation
omittedl. . . . Additionally, section 2 l0(Ð of PURPA instructs state regulatory authorities
to implement these FERC rules."3e
3s Idaho Power's Memorandum in Support of its Motion to Intervene at p. 12. (Dkt. no. 7-10.
36 Id.
37 td.
38 AUco Renewable Energy Ltd. V. Mass. Elec. Co.875 F.3d 64 (l't Cir. 2017) and Exelon Wind,
L LLC v. Nelson, 766 F.3d 380 (5th Cir.2014).
3e AUco, supra at. 67 .
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Although the IPUC had, indeed, implemented PURPA in compliance with its mandate under that
federal law, it has now strayed from such compliant implementation by implementing a new policy
that infringes on FERC's responsibility to determine a QF's eligibility under PURPA. Plaintiffs
are not asking the court to order ldaho Power to enter into a contract, indeed, Idaho Power was not
even a party to the original complaint filed by Plaintiffs. It is important for the Power Company
to recall exactly what it is that the Plaintiffs are asking this court to do. That is, if Plaintiffs are
successful, the Idaho Commission will only be obligated to "implement PURPA in a lawful
manner by recognizing the QF status of energy storage QFs as distinct from their energy input
(source)" and it will therefore, by default, be obligated to "require the utilities under their IIPUC]
jurisdiction to afford energy storage QFs all rights and privileges afforded to "all other ' QFs -
other than wind and solar."4o
V.
CONCLUSION
The Idaho Power Motion for Summary Judgment should in all respects be DENIED, with
judgment being awarded to Plaintiffs for the relief requested in their Motion for Summary
Judgment.
DATED this 30th day of November 2018.
/s/ Robert C. Huntlqt, Esq.
/s/ Peter J. Richardson. Esq.
Attomeys for Plaintiffs
a0 Frist Amended Complaint for declaratory judgement and order implementing the same, at p
15. (Dkt. no.2).
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CERTIFICATE OF SERVICE
I hereby certify that on this 30th day of November 2018, I caused a true copy of the
foregoing document to be electronically filed with the Clerk of the Court using the CM/ECF
system, which sent a Notice of Electronic Filing to the following persons:
Brandon Karpen [e-mail]. gov
Scott Zanzig scott.zanzig@ag. idaho. gov
Steven B. Anderson [e-mail]
Wade L. Woodard wlw(Øaswblaw.com
Donovan E. V/alker [e-mail]
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