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Home My WebLink About20081126Petition.pdfPeter J. Rìchardson ISB # 3195 515 N. 2ih Street Boìse, Idaho 83702 Telephone: (208) 938-7901 Fax: (208) 938-7904 peter(frìchardsonandoleary.com RECEIVE 2008 NOV 26 AMI l: 52 IDAHQ PUBUe UTILITIES COMMISSION Attorneys for the Northwest and Intermountaìn Power Producers Assocìatìon BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION IN THE MATTER OF THE NORTHWEST ) AND INTERMOUNTAIN POWER ). PRODUCERS COALITION'S PETITION ) TO OPEN A GENERIC INSTIGATION ~. REGARING COMPETITIVE BIDDING ) REQUIREMENTS FOR NEW SUPPL Y- ) SIDE RESOURCE ACQUISITIONS ~ ) CASE NO. GNR-08-o3 PETITION TO OPEN GENERIC INVESTIGATION COMES NOW, The Northwest and Intermountaìn Power Producers Coalìtìon, hereìnafier referred to as "NIPPC or your Petìtìoner," and pursuant to Rule 53 (IDAP A 31.01.01.53) of the Rules of Procedure of the Idaho Publìc Utìlìtìes Commìssìon ("Commìssìon") hereby petìtìons the Commìssìon to open a generìc ìnvestìgatìon ìnto the desìrabìlty of ìnìtìatìng competìtìve bìddìng guìde1ìnes for the procurement of supply-sìde resources by the e1ectrìc utìlìtìes under ìts regulatory authority. NIPPC ìs joìned ìn thìs Petìtìon by the Industrial Customers ofIdaho Power, the J. R. Sìmplot Company and the Idaho Irrgatìon Customers Assocìatìon, Inc. NIPPC ìs a coalìtìon of ìndependent power producers and alled companìes whose mìssìon ìs to promote a competìtìve wholesale e1ectrìc supply marketplace ìn the Northwest and Intermountaìn West. The Industrìal Customers of Idaho Power ìs an unìncorporated assocìatìon Petition of NIP PC 1 of some of Idaho Power's largest customers who all take servìce under Rate Schedule 19. The Idaho Irrigatìon Pumpers Assocìatìon ìs a non-profit organìzatìon commìtted to a re1ìable power supply at reasonable cost for Idaho's ìrrìgators. The J. R. Sìmplot Company ìs one ofIdaho's largest employers and one of Idaho Power' largest customers. 1. CURRNT STATUS OF COMPETITIVE BIDDING IN IDAHO The Idaho Commìssìon regulates three ìnvestor-owned utìltìes, Idaho Power Company (IPCo), A vìsta, and Rocky Mountaìn Power (RMP), hereìn referred to collectìvely as the "Utìlìtìes". All three Utìlìties are ìn varìous stages of resource acquìsìtìon and all three are provìded guìdance ìn theìr resource acquìsìtìon decìsìons through theìr ìndìvìdual resource acquìsìton blueprìnts called Integrated Resource Plans (IRPs). IRPs, whìle useful tools ìn analyzìng resource optìons, are generally sìlent on the method by whìch any parìcular resource should be acquìred. The IRP process sìmply does not provìde the framework for oversìght of the resource acquìsìtìon process. Utìltìes ìn Idaho are free to offer supply-sìde resource acquìsìtìon requests for proposals (RFPs) that are desìgned and admìnìstered completely wìthout Commìssìon or other stakeholder ìnput. Indeed, utìltìes ìn Idaho are even free to make supply sìde resource acquìsìtìon decìsìons wìthout the benefit ofa RFP. In the Pacìfic Northwest states ofWashìngton and Oregon, these same utìlìtìes are requìred to make resource acquìsìtìons through a Commìssìon approved, and staeholder ìnvolved, process. Whìle the Commìssìons ìn Oregon and Washìngton seek to ìnsure that resource acquìsìtìon decìsìons by Avìsta and PacìfiCorp are made wìth theìr oversìght and guìdance and stakeholder parìcìpatìon, that process - and the benefits ìt delìvers - does not curently apply to Idaho Power's.supply sìde acquìsìtìons. Petition of the NIPPC 2 II NARUC ENDORSES NATIONAL TREND TOWAR COMMISSION OVERSIGHT OF COMPETITIVE RESOURCE ACQUISITION ACTIVITIES NIPPC makes ìts request of thìs Commìssìon because Idaho ìs the only state ìn the Pacìfic Northwest that does not actìvely oversee or provìde guìdelìnes for the ìnvestor owned utìltìes ìt regulates that govern theìr acquìsìtìon of supply sìde resources. The adoptìon of guìdelìnes and actìve oversìght of supply sìde resource acquìsìtìon decìsìons ìs ìncreasìngly the norm. Thìs July, the Natìonal Assocìatìon of Regulatory Commìssìons ìssued a comprehensìve report entìtled "Competìtìve Procurement of Retaìl Electrìc Supply: Recent Trends ìn State Polìcìes and Utìlìty Practìces."i That report concludes: Competìtìve procurements for retaìl electrcìty supply have been used for many years ìn dìfferent states. More than forty percent of the states now rely on formal polìcìes and rules for procurements, whìle regulators ìn many other states encourage use of competìtìve procurements by utìltìes ìn determìnìng whìch resources to add to theìr mìx ofretaìl supply. Where regulators have commìtted to relyìng upon competìtìve procurement approaches as a means to help ìdentìfy the "best" resources needed to meet the needs of the utìlty's customers, the process should be desìgned and ìmplemented so that ìt reflects the followìng crìteria (and ìs generally vìewed as beìng consìstent wìth them): · faìr and objectìve; · desìgned to encourage robust competìtìve responses from market parìcìpants wìth creatìve responses from the market; · based on evaluatìons that ìncorporate all approprìate and relevant prìce and non-price factors; · efficìent, wìth a tìme1y se1ectìon process; aid · supported by regulatory actìons that posìtìvely reìnforce the commìssìon's commìtment2 The Report ìs a blueprìnt on how to ìmplement guìdelìnes that are both faìr and effectìve. i http://ww.naruc.org/PublìcatìonsINARUC%20Competìtìve%20Procurement%20FìnaL.pdf 2 Id. at page 57. Petition of the NIPPC 3 III NEED FOR ACTION Several ofNIPPC's members are actively parìcipatìng in Idaho Power's curent RFP for new resources; many others are not. All of these companies, whether they are participating or not, have expressed serious concern regarding the RFP's design, timing and intent. They have concluded that the just-closed RFP resembles other recent Idaho Power solìcitations, i.e., it favors the utìlty's self-buìld option. The consequence of an under-subscrìbed RFP and/or one where the outcome is pre-ordained deprìves the ratepayers of access to the competitive marketplace. It forecloses the opportunty of tapping into what may prove to be least cost - in economic and environmental terms - power generated by independent power producers (IPPs). Competitively procured power purchase agreement (PPAs) can shift tagible and considerable risk from ratepayers onto IPPs. These risks span the range of development and operations and are equally applìcable regardless of technology. IPPs' business model is based on competìtion and the principle of pay for performance; ìt leverages the profit motive to consumers' advantage. The independent power industry curently supplìes approximately 40 percent of the natìon's electricity and many companies, large and small, foreign and domestic, are active in the Pacific Northwest. Meanwhìle, IPPs, who led the innovation of combined cycle combustion and of wind power tubine technologies is optìmizìng the operations of the diverse power plants the industry curently operates. Regardless of the curent 'need for action', the implementation of competitive procurement guidelìnes in Idaho is consistent with good regulatory practìce. It is a practice that is endorsed by utilìty commissions across the country and is proven to produce the best results for the ratepayers while at the same time creating a fair and competitive market place for resource acquisition decisions. Petition of the NIPPC 4 iv CONCLUSION NIPPC and its parners herein respectfully request this Commission open a docket for the purose of exploring whether competitive RFPs should be r~quired of all three Utìlties is reasonable. If the answer is in the affirmative, the docket should be used to explore reasonable parameters and rules governng the supply side acquisìtion process through competìtive procurement. Dated this 26th day of November 2008 and respectfully submitted by:BY£~g,~ Peter Richardson IS# 3954 RICHARDSON & O'LEARY PLLC .; Petition of the NIPPC 5 CERTIFICATE OF SERVICE I HEREBY CERTIFY that on the 26th day of November, 2008, a tre and correct copy of the wìthin and foregoing PETITION TO OPEN GENERIC INVESTIGATION was served in the manner shown to: Ms. Jean Jewell Commssion Secreta Idaho Public Utìlties Commssion POBox 83720 Boise ID 83720-0074 X- Hand Delìvery _U.S. Maìl, postage pre-paid Facsimìle Electronic Maìl IDAHO POWER COMPANY JohnR. Gale Vice President, Regulatory Affairs Idaho Power Company POBox 70 Boise, Idaho 83707-0070 _ Hand Delìvery --U.S. Mail, postage pre-paid Facsimìle Electronic Maìl Baron L. Klìne Senior Regulatory Attorney Idaho Power Company POBox 70 Boise, Idaho 83707-0070 _ Hand Delìvery --U.S. Mail, postage pre-paid Facsimìle Electronic Maìl PacifiCorp, DBA Rocky Mountain Power Ted Weston 201 S Main St Ste 2300 Salt Lake City UT 84111 _ Hand Delìvery --D.S. Maìl, postage pre-paid Facsimìle Electronic Maìl Danel Solander 201 S Main St Ste 2300 Salt Lake City UT 84111 _ Hand Delìvery . X U.S. Maìl, postage pre-paid Facsimìle Electronic Maìl AVISTA CORPORATION Kelly Norwood PO Box 3727 Spokane WA 99220-3727 _ Hand Delivery --U.S. Mail, postage pre-paid Facsimile Electronic Maìl David Meyer PO Box 3727 Spokane WA 99220-3727 _ Hand Delivery --U.S. Maìl, postage pre-paid Facsimìle Electronic Maìl Idaho Irrigation Pumpers Assoc., Inc Eric Olson 201 E Center St PO Box 1391 Pocatello ID 83204-1391 _ Hand Delìvery --U.S. Maìl, postage pre-paid Facsimìle Electronic Maìl J. R. SIMPLOT COMPANY Don Sturevant 999 Main St 13th Floor PO Box 27 Boise ID 83707-0027 _ Hand Delìvery --U.S. Maìl, postage pre-paid Facsimìle Electronic Maìl ~N\Úl'h~