20121002Partial Settlement.pdf

22 OCT -2 AM 9 2
STATE OF IDAHO UTIUTtES OOMMISSK)t
OFFICE OF THE ATTORNEY GENERAL
LAWRENCE G. WASDEN
HAND-DELIVERED
Jean D. Jewell
Commission Secretary
Idaho Public Utilities Commission
427 W. Washington Street
Boise, ID 83702-5918
Re: Partial Settlement in Case No. GNR-E-11-03
Dear Ms. Jewell:
In Order No. 32617 issued August 15, 2012, the Commission directed the parties in the above-
referenced case to attend a settlement conference to address two issues: (1) light load
curtailment; and (2) terms of delay security or liquidated damages. Settlement conferences were
convened on August 23, and September 7, 2012. Although the parties were unable to reach any
consensus regarding the curtailment issues, several parties were able to reach consensus
regarding the issue of delay security or liquidated damages. Enclosed with this transmittal letter
is the Partial Settlement Stipulation executed by many but not all of the parties in this case.
As set out in greater detail in the Partial Settlement Stipulation, the signing parties agree that all
new PPAs approved after the date of the Partial Settlement Stipulation should be in agreement
with the terms and conditions of the settlement. The signing parties urge the Commission to
approve the Partial Settlement Stipulation without condition or modification.
Respectfully submitted this 2' r2012.
I E114i4m_ a IN
Deputy Attorney General
Enclosure
cc: Parties of Record
bls/L:JeweII_dhGNR-E-1 1-03
Contracts & Administrative Law Division, Idaho Public Utilities Commission
P.O. Box 83720, Boise, Idaho 83720-0074, Telephone: [phone] FAX: [phone], E-mail: [e-mail]
Located at 472 West Washington St., Boise, Idaho 83702
DONALD L. HOWELL, II
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
P0 BOX 83720
BOISE, IDAHO 83720-0074
TELEPHONE: [phone]
E-MAIL: [e-mail]
IDAHO BAR NO. 3366
STREET MAILING ADDRESS:
472 WEST WASHINGTON STREET
BOISE, IDAHO 83702-5983
RECEIVED
202 OCT -2 AIM 9: 24
r1J
L
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE COMMISSION'S
REVIEW OF PURPA QF CONTRACT
PROVISIONS INCLUDING THE
SURROGATE AVOIDED RESOURCE (SAR)
AND INTEGRATED RESOURCE PLANNING
(IRP) METHODOLOGIES FOR
CALCULATING PUBLISHED AVOIDED
COST RATES.
CASE NO. GNR-E-11-03
PARTIAL
SETTLEMENT STIPULATION
This Settlement Stipulation is entered into by and among the undersigned parties
(collectively "the Parties") in Case No. GNR-E-1 1-03.
I. BACKGROUND
In September 2011, the Commission initiated this generic investigation to review the
terms of PURPA power purchase agreements (PPAs). The Commission convened a technical
hearing on August 7-9, 2012, where the Parties presented evidence that addressed a variety of
different issues. On August 15, 2012, the Commission issued Order No. 32617 convening a
settlement conference to allow the Parties to determine whether settlement is possible for two
issues in the case: (1) light-load curtailment as proposed in Idaho Power Company's Schedule
74 or in an alternative process; and (2) terms of delay security or liquidated damages in PPAs.
Order No. 32617 at 1. The settlement conference was convened on August 23, 2012.
PARTIAL
SETTLEMENT STIPULATION
Parties in attendance at the settlement conference included: Idaho Power Company;
Avista Corporation; PacifiCorp dba Rocky Mountain Power; Commission Staff; Northwest and
Intermountain Power Producers Coalition; J.R. Simplot Company; Grand View Solar II; Exergy
Development Group; Renewable Energy Coalition; Dynamis Energy; North Side Canal
Company and Twin Falls Canal Company; Adams County; Ted Sorenson; Idaho Windfarms;
Blue Ribbon Energy; Renewable Northwest Project; Idaho Conservation League; Snake River
Alliance; Clearwater Paper Corporation; Idaho Wind Partners; Ridgeline Energy; Big Wood
Canal Company and American Falls Reservoir; and Mountain Air Projects.
The Parties were unable to settle the curtailment issue but scheduled a subsequent
settlement conference for September 7, 2012, to continue negotiating the issue of delay
security/liquidated damages. After the second settlement conference the parties engaged in
further informal discussions that ultimately resulted in this Partial Settlement Stipulation
executed by most, but not all, of the Parties in the case.
Based upon the settlement discussions, as a compromise of the positions taken in this
case regarding the issues of delay damages, performance security and liquidated damages, the
undersigned parties agree to settle the following issues and agree that all new PPAs approved
after the date of the Partial Settlement Stipulation conform to the terms set out below.
II. TERMS OF THE PARTIAL SETTLEMENT STIPULATION
1.Calculation of the Security Deposit. The Parties agree that a security deposit or
performance bond ("the Security Deposit") will be required for each new PURPA agreement
(PPA; FESA) entered into after the date upon which the Commission adopts and approves this
Settlement Stipulation. The purpose of the Security Deposit is to provide security for: (1) Delay
Damages during the Cure Period if the QF is not in commercial operation by the Scheduled
Commercial Operation Date set out in the PPA; and (2) Termination Damages if the QF cannot
cure a failure to achieve commercial operation and a party seeks termination of the PPA. The
Security Deposit shall be set at $45.00 per kilowatt (kW) of nameplate capacity for each new
PPA. The cash or other liquid Security Deposit will be forwarded to the utility no later than
thirty (30) days after the Commission issues its final Order approving the PPA.
2.Refund of Security Deposit. If the QF has achieved commercial operation in
accordance with the Scheduled Commercial Operation Date, the utility will promptly refund the
Security Deposit to the QF.
PARTIAL
SETTLEMENT STIPULATION 2
3.Failure to Achieve Commercial Operation - Delay Damages. In the event the QF
fails to achieve commercial operation by the Scheduled Commercial Operation Date contained in
the PPA, Delay Damages shall be calculated based upon the difference between market rates at
the time the QF fails to achieve its Scheduled Commercial Operation Date and the avoided cost
rates contained in the PPA during the Cure Period. Delay Damages, if any, during the Cure
Period will be drawn from the Security Deposit held by the utility. If the Security Deposit is
insufficient to defray all of the Delay Damages, then the QF will promptly pay the outstanding
Delay Damages. If the QF achieves commercial operation during the cure period, any remaining
Security Deposit beyond the amount of any Delay Damages shall be refunded to the QF.
4.Cure Period. The defaulting party shall have one hundred twenty (120) days from
the Scheduled Operation Date to cure its default.
5.Failure to Cure. In the event the QF fails to achieve commercial operation within
the Cure Period, then the non-defaulting party may, at its option, collect its Delay Damages as
calculated in Paragraph No. 3 above, terminate the Agreement, and calculate its Termination
Damages, if any. If the QF fails to achieve commercial operation within the cure period and the
non-defaulting party elects to terminate the Agreement, the Security Deposit may be used to: (a)
first pay the Delay Damages arising during the cure period, if any; and (b) second pay
Termination Damages, if any, arising after the Cure Period for the remaining term of the
Agreement.
6.Termination Damages. The party claiming that the PPA is in default and seeking
termination of the Agreement shall communicate its notice of default and claim for any
Termination Damages to the other party within a reasonable time. The other party shall respond
within fifteen (15) days. In the event of a dispute regarding the calculation of Termination
Damages, either party may resort to a court of competent jurisdiction.
7.Undisputed Damages and Refunds. The utility may draw any undisputed Delay
Damages or Termination Damages from the Security Deposit. In the event that the Security
Deposit is insufficient to pay the undisputed damages, such undisputed damages will be paid
promptly by the defaulting party. If the Security Deposit exceeds the total amount claimed as
Delay Damages or Termination Damages, the utility shall promptly refund any portion of the
deposit that is in excess of the claimed Delay Damages or Termination Damages.
PARTIAL
SETTLEMENT STIPULATION 3
8.Security Deposit for Existing OF Projects. The Parties agree that a Security
Deposit shall not be required in situations where the parties are entering into a new PPA for an
existing QF project already in commercial operation so long as the new PPA is between the same
parties and there are no material changes or modifications to the existing QF project.
III. OTHER SETTLEMENT CONDITIONS
9.The Parties agree that existing PPAs that have been previously approved by the
Commission shall not be affected by this Settlement Stipulation. While some of the signing QF
Parties have operational QF projects, and thus are not affected by the issues contained in the
Settlement Stipulation, such parties do not oppose the Settlement Stipulation.
10.The Parties recommend that the Commission adopt this settlement without
further proceedings. The Parties assert that the Settlement Stipulation is reasonable and in the
public interest and no further proceeding is necessary.
11.The Parties agree that this Settlement Stipulation represents a compromise of the
positions of the Parties related to this issue. As provided in Rule 272, other than testimony filed
in support of the approval of this Settlement Stipulation, and except to the extent necessary for a
party to explain its own position with the respect to the Settlement Stipulation, all statements and
positions taken in are confidential and will not be admissible in evidence in this or any other
proceeding.
12.Upon Commission approval of this Settlement Stipulation, the utilities shall,
except as otherwise mutually agreed by the utility and the QF, revise the terms and conditions of
their respective standard PURPA PPAs so that all new PPAs entered into after the date the
Commission approves this partial settlement conform to the provisions of this Settlement
Stipulation.
13.The Parties executing this Settlement Stipulation shall not appeal that portion of a
Commission Order approving the Settlement Stipulation or the delay security/liquidated damages
issue resolved by this Settlement Stipulation. If this Settlement Stipulation is challenged by
anyone who has not executed the Settlement Stipulation, the Parties reserve the right to file
testimony, cross-examine witnesses, and put forth such case as they deem appropriate to respond
fully to the issue presented, including the right to raise issues that are incorporated and embodied
in this Settlement Stipulation. Notwithstanding this reservation of rights, the Parties agree that
PARTIAL
SETTLEMENT STIPULATION 4
they will continue to support the Commission's adoption of the terms of this Settlement
Stipulation.
14.If the Commission rejects any or all parts of this Settlement Stipulation, or
imposes any additional material conditions on approval of this Settlement Stipulation, each party
reserves the right, upon written notice to the Commission and other Parties to this proceeding,
within fourteen (14) days of the date of such action by the Commission, to withdraw from this
Settlement Stipulation. In such case, no party shall be bound or prejudiced by the terms of this
Settlement Stipulation, and each party shall be entitled to seek reconsideration of the
Commission's Order.
15.No Party shall be bound, benefited, or prejudiced by any position asserted in the
negotiation of this Settlement Stipulation, except to the extent expressly stated herein, nor shall
this Settlement Stipulation be construed as a waiver of rights unless such rights are expressly
waived herein. Except as otherwise expressly provided for herein, execution of this Settlement
Stipulation shall not be deemed to constitute an acknowledgment by any Party of the validity or
invalidity of any particular method, theory, or principle of regulation or cost recovery. No Party
shall be deemed to have agreed that any method, theory or principle of regulation employed in
arriving at this Settlement Stipulation is appropriate for resolving any issues in any other
proceeding in the future. No findings of fact or conclusions of law other than those stated herein
shall be deemed to be implicit in this Settlement Stipulation.
16.The obligations of the Parties are subject to the Commission's approval of this
Settlement Stipulation in accordance with its terms and conditions and upon such approval being
upheld on appeal, if any, by a court of competent jurisdiction.
17.This Settlement Stipulation may be executed in counterparts and each signed
counterpart shall constitute an original document.
IV. PRAYER
In summary, the signing Parties believe that this settlement is reasonable and in the
public interest, and urges the Commission to approve the Settlement Stipulation without
condition or modification. Given the involvement of the Parties in this settlement, the Parties
believe the public interest does not require a hearing or further proceeding before the
Commission approves this settlement. If the Commission approves this settlement, then the
PARTIAL
SETTLEMENT STIPULATION 5
utilities shall revise their respective standard PPAs to conform to the terms of this Settlement
Stipulation.
Respectfully submitted this ThL
Q4Db.r
day of-September 2012.
PacifiCorp dba Rocky Mountain Power:
an
Daniel Solander
Idaho Public Utilities Commission Staff:
By:
istine A. Sasser, DAG
Interconnect Solar Development, LLC:
R. Greg Femey
Birch Power Company:
Ted S. Sorenson
Blue Ribbon Energy LLC:
M. J. Humphries
Snake River Alliance:
By:
Ken Miller
Avista Corporation
Michael G. Andrea
Renewable Energy Coalition, Dynamis
Energy, LLC:
By:
Ronald Williams
North Side Canal Company, Twin Falls
Canal Company, Big Wood Canal
Company, American Falls Reservoir
District No. 2:
By:
C. Thomas Arkoosh
Idaho Windfarms, Renewable Northwest
Project, Ridgeline Energy, LLC:
Dean J. Miller
Idaho Conservation League:
By: /-' T
Benjamin J. Otto
Energy Integrity Project:
Tauna Christensen
Idaho Wiq4 Partners I, LLC: Mountain Air Projects, LLC:
By:
Deborah E. Nelson Michael J. Uda
PARTIAL
SETTLEMENT STIPULATION 6
utilities shall revise their respective standard PPAs to conform to the terms of this Settlement
Stipulation.
Respectfully submitted this A day of September 2012.
PacifiCorp dba Rocky Mountain Power:
By:
Mark C. Moench
Idaho Public Utilities Commission Staff:
By:
Kristine A. Sasser, DAG
Interconnect Solar Development, LLC:
By:
R. Greg Ferney
Birch Power Company:
By:
Ted S. Sorenson
Blue Ribbon Energy LLC:
By:
M. J. Humphries
Snake River Alliance:
By:
Ken Miller
Idaho Wind Partners I, LLC:
By:
Deborah E. Nelson
PARTIAL
SETTLEMENT STIPULATION 6
Avista Corporation
By:
Michael G. Andrea
Renewable Energy Coalition, Dynamis
Energy, LLC:
By:
Ronald Williams
North Side Canal Company, Twin Falls
Canal Company, Big Wood Canal
Company, American Falls Reservoir
District No. 2:
By:
C. Thomas Arkoosh
Idaho Windfarms, Renewable Northwest
Project, Ridgeline Energy, LLC:
By:
Dean J. Miller
Idaho Conservation League:
By:
Benjamin J. Otto
Energy Integrity Project:
By:
Tauna Christensen
Mountain Air Projects, LLC:
By:
Michael J. Uda
utilities shall revise their respective standard PPAs to conform to the terms of this Settlement
Stipulation.
Respectfully submitted this d0l day of September 2012.
PacifiCorp dba Rocky Mountain Power: Avista Corporation
By:
Michael G. Andrea
Renewable Energy Coalition, Dynamis
Energy, LLC:
By:
Ronald Williams
North Side Canal Company, Twin Falls
Canal Company, Big Wood Canal
Company, American Falls Reservoir
District No. 2:
By:
C. Thomas Arkoosh
;rnerC:
Dean J. Miller
Idaho Conservation League:
By:
Benjamin J. Otto
Energy Integrity Project:
By:
Tauna Christensen
Mountain Air Projects, LLC:
By:
Michael J. Uda
By:
Daniel Solander
Idaho Public Utilities Commission Staff:
By:
Kristine A. Sasser, DAG
Interconnect Solar Development, LLC:
By:
R. Greg Femey
Birch Power Company:
By:
Ted S. Sorenson
Blue Ribbon Energy LLC:
By:
M. J. Humphries
Snake River Alliance:
By:
Ken Miller
Idaho Wind Partners I, LLC:
By:
Deborah B. Nelson
PARTIAL
SETTLEMENT STIPULATION 6
utilities shall revise theit respective standard PPAs to conform to the terms of this Settlement
Stipulation.
RespecthzUy submitted this. day of September 2012.
PacItiCorpdba Rocky Mountain Power Aista Corporation
By:______________
Daniel Solander Michael G. Andrea
Idaho Public Utilities Commission Staff: Renewable Energy Coalition, Dynamis
Energy, LLC:
By:
KEistine A. Sasm. DAG By:
Ronald Williams
1s..:•s$ar flevel,ont, LLC: North $lde Cnl Company, Twin Falls
Canal Ciy, Big Wood. C*nal
By: Cy, American Fails Reservoir
R. Greg Ferney OlatrktNo. 2:
By:
C. Thomas Arkoosh
Idaho Windfaraus Renewable Northwest
Project, Ridgetine Energy, LLC:
By:___
Dean J
_
Miller
Idaho Conservation League:
13v:
Benjamin I Otto
Energy Integrity Project:
l3irch Power Company:
0 F - M. ~ ~ W..'
Bin*jbbin Energy LLC:
By:
M. I HumphrIes
Snake River A1tiace:
By:
Tauna Christensen
Mountain Air Projects, LLC:
By:
Michael J. Uda
PARTIAL
SETh.EMENT STIPULATION 6
utilities shall revise their respective standard PPAs to conform to the terms of this Settlement
Stipulation
Respectfully submitted this day of September 2012.
Pacifiorp dba Rocky Mountain Power: Avista Corporation
By: By:
Daniel Solander Michael G. Andrea
Idaho Public Utilities Commission Staff:
By:
Kristine A Sasser, DAG
Interconnect Solar Development, LLC:
By:
R. Greg Ferney
Renewable Energy Coalition, Dynamis
Energy, LLC:
By: _9—a4 4
Ronald Williams
North Side Canal Company, Twin Falls
Canal Company, Big Wood Canal
Company, American Falls Reservoir
District No. 2:
By:
C. Thomas Arkoosh
Birch oa
By: Po'-'.1po( S. cocov.
Ted S. Sorenson
Blue Ribbon Energy LLC:
By:
M. J. Humphries
Snake River Alliance:
By:
Ken Miller
Idaho Wind Partners I, LLC:
Idaho Windfarms, Renewable Northwest
Project, Ridgciine Energy, LLC:
By:
Dean J. Miller
Idaho Conservation League:
By:
Benjamin J. Otto
Energy Integrity Project:
By:
Tauna Christensen
Mountain Air Projects, LLC:
By:
Deborah F. Nelson Michael J. Uda
PARTIAL
SETTLEMENT STIPULATION 6
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 2t DAY OF OCTOBER 2012,
SERVED THE FOREGOING PARTIAL SETTLEMENT STIPULATION, IN CASE
NO. GNR-E- 11-03, BY E-MAILING A COPY THEREOF TO THE FOLLOWING:
DONOVAN E WALKER
JASON B WILLIAMS
IDAHO POWER COMPANY
P0 BOX 70
BOISE ID 83707-0070
E-mail: [e-mail]
[e-mail]
MICHAEL G ANDREA
AVISTA CORPORATION
1411 EMISSION AVE
SPOKANE WA 99202
E-mail: michael.andrea@avistacori,.com
ROBERT D KAHN
NW & INTERMOUNTAIN POWER
PRODUCERS COALITION
1117 MINOR AVE STE 300
SEATTLE WA 98101
E-mail: rkahn(nippc.org
ROBERT A PAUL
GRAND VIEW SOLAR II
15690 VISTA CIRCLE
DESERT HOT SPRINGS CA 92241
E-mail: robertpaul082gmai1.com
ELECTRONIC SERVICE ONLY:
DR. DON READING
E-mail: dreadingcäimindspring.com
MARV LEWALLEN
CLEARWATER PAPER CORP
601 W RIVERSIDE AVE STE 1100
SPOKANE WA 99201
E-mail: [e-mail]
DANIEL E SOLANDER
ROCKY MOUNTAIN POWER
201 S MAIN ST STE 2300
SALT LAKE CITY UT 84111
E-mail: [e-mail]
PETER J RICHARDSON
GREGORY M ADAMS
RICHARDSON & O'LEARY
515 N 27TH STREET
BOISE ID 83702
E-mail: [e-mail]
[e-mail]
DON STURTEVANT
ENERGY DIRECTOR
J R SIMPLOT COMPANY
P0 BOX 27
BOISE ID 83707-0027
E-mail: [e-mail]
JAMES CARKULIS
EXERGY DEVELOPMENT GROUP OF
IDAHO LLC
802 W BANNOCK ST STE 1200
BOISE ID 83702
E-mail: jcarku1iscexergydeveloprnent.com
BILL BROWN CHAIR
BOARD OF COMMISSIONERS
OF ADAMS COUNTY ID
P0 BOX 48
COUNCIL ID 83612
E-mail: [e-mail]
TED S SORENSON P E
BIRCH POWER COMPANY
5203 SOUTH 1 l TH EAST
IDAHO FALLS ID 83404
E-mail: [e-mail]
CERTIFICATE OF SERVICE
R GREG FERNEY BILL PISKE MGR
MIMLJRA LAW OFFICES PLLC INTERCONNECT SOLAR DEVELOPMENT LLC
2176 E FRANKLIN RD STE 120 1303 E CARTER
MERIDIAN ID 83642 BOISE ID 83706
E-mail: gregmimuralaw.com E-mail: [e-mail]
RONALD L WILLIAMS WADE THOMAS
WILLIAMS BRADBURY DYNAMIS ENERGY LLC
1015 W HAYS ST 776 E RIVERSIDE DR STE 15
BOISE ID 83702 EAGLE ID 83616
E-mail: [e-mail] E-mail: [e-mail]
JOHN R LOWE LIZ WOODRUFF
RENEWABLE ENERGY COALITION KEN MILLER
12050 SW TREMONT ST SNAKE RIVER ALLIANCE
PORTLAND OR 97225 BOX 1731
E-mail: [e-mail] BOISE ID 83701
E-mail: [e-mail]
[e-mail]
C THOMAS ARKOOSH ELECTRONIC SERVICE ONLY:
CAPITOL LAW GROUP PLLC
205 N 1OTHST 4TH FL BRAIN OLMSTEAD
P0 BOX 2598 GENERAL MANAGER
BOISE ID 83701 E-mail: olmstead(tfcanal.com
E-mail: [e-mail]
TED DIEHL
GENERAL MANAGER
E-mail: [e-mail]
DON SCHOENBECK
RCS
E-mail: [e-mail]
LORI THOMAS
CAPITOL LAW GROUP PLLC
E-mail: [e-mail]
M J HUMPHRES ARRON F JEPSON
BLUE RIBBON ENERGY LLC BLUE RIBBON ENERGY LLC
3470 RICH LANE 10660 SOUTH 540 EAST
AMMON ID 83406 SANDY UT 84070
E-mail: [e-mail] E-mail: [e-mail]
DEAN J MILLER MEGAN WALSETH DECKER
CHAS McDEVITT SR STAFF COUNSEL
McDEVITT & MILLER LLP RENEWABLE NW PROJECT
P0 BOX 2564 421 SW 6TH AVE STE 1125
BOISE ID 83701 PORTLAND OR 97204
E-mail: joemcdevitt-miller.com E-mail: megan(rnp.org
[e-mail]
CERTIFICATE OF SERVICE
GLENN IKEMOTO
MARGARET RUEGER
IDAHO WINDFARMS LLC
672 BLAIR AVE
PIEDMONT CA 94611
E-mail: [e-mail]
[e-mail]
TAUNA CHRISTENSEN
ENERGY INTEGRITY PROJECT
769N 1100E
SHELLEY ID 83274
E-mail: [e-mail]
BENJAMIN J OTTO
IDAHO CONSERVATION LEAGUE
P0 BOX 844
BOISE ID 83702
DEBORAH E NELSON
KELSEY J NUNEZ
GIVENS PURSLEY
601 W BANNOCK ST (83702)
P0 BOX 2720
BOISE ID 83701-2720
E-mail: [e-mail]
[e-mail]
070, 7A 1 L. WE
SECRETARY
CERTIFICATE OF SERVICE