20101108Answer in Opposition to Joint Motion.pdf

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ATTORNEYS AT LAW 2016 NOV -8 AM 9: 22
Peter Richardson
Tel: [phone] Fax: [phone]
pete rti r i chardso n andol ea ry. com
P.O. Box 7218 Boise, 10 83707 - 515 N. 27th Sr. Boise, lD 83702
8 November 2010
Ms. Jean Jewell
Commission Secretary
Idaho Public Utilities Commission
472 W. Washington
Boise, ID 83702
RE: GNR-E-IO-04
Dear Ms. Jewell:
We are enclosing an original and seven copies ofthe ANSWER IN OPPOSITION TO
JOINT MOTION TO ADJUST PUBLISHED AVOIDED COST RATE
ELIGIBILITY CAP BY THE NORTHWEST AND INTERMOUNTAIN POWER
PRODUCERS COALITION in the above case. Would you please file the same?
Than you for your attention to this matter. Please feel free to give me a call if you have
any questions.
Sincerely,GJ/
Peter J. Richardson
Richardson & O'Leary PLLC
'"
Peter J. Richardson (ISB # 3195)
Gregory M. Adams (ISB # 7454)
Richardson & O'Leary, PLLC
515 N. 27th Street
P.O. Box 7218
Boise, Idaho 83702
Telephone: [phone]
Fax: [phone]
peter(grichardsonandolear.com
greg(grichardsonandolear,com
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i~lûNtW -8 ßl\9: 22
Attorneys for Northwest and Intermountain
Power Producers Coalition
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE JOINT PETITION
OF IDAHO POWER COMPANY, AVISTA
CORPORATION AND ROCKY MOUNTAIN
POWER TO ADDRESS AVOIDED COST
ISSUES AND JOINT MOTION TO ADJUST
THE PUBLISHED AVOIDED COST RATE
ELIGIBILITY CAP
)
) CASE NO. GNR-E-IO-04
)
~ ANSWER IN OPPOSITION TO JOINT
MOTION TO ADJUST PUBLISHED
~ AVOIDED COST RATE ELIGIBILITY
) CAP
)
)
)
)
COMES NOW, Northwest and Intermountain Power Producers Coalition
("NIPPC") and, pursuant to Idaho Administrative Rules 31.01.01.331.256.04, fies this
Answer in Opposition to the motion of Idaho Power Company, Avista Corporation, and
Rocky Mountain Power (the "Joint Motion"). The Joint Motion requests that the
Commission immediately reduce the eligibility cap for stadard rates contaned in Public
Utility Regulatory Policies Act of 1978 ("PURP A") power purchase agreements
("PPAs") for qualifying facilities ("QFs") from a project size of under 10 average
monthy mega-watts ("aMW) to a project size of under 1 00 kilowatts ("kw") nameplate
ANSWER IN OPPOSITION TO JOINT MOTION TO ADJUST PUBLISHED
AVOIDED COST RATE ELIGIBILITY CAP
PAGE-l
capacity. The Joint Motion requests Commission determination on the eligibility cap
issue in less than 14 days from the Joint Motion's purorted date of service, November 5,
2010. For the reasons set forth below NIPPC opposes the Joint Motion, and respectfully
requests that the Idaho Public Utilities Commission (the "Commission") deny the Joint
Motion for expedited disposition.
BACKGROUND
"Congress passed PURPA in 1978 in response to the prevailing energy crisis."
Rosebud Enterprises, Inc. v. Idaho Public Utilties Commission, 128 Idaho 609, 613, 917
P.2d 766, 780 (1996). Congress's intent "was to encourage the promotion and
development of renewable energy technologies as alternatives to fossil fuels and the
constrction of new generating facilities by electrc utilities." Id. PURP A and FERC' s
regulations entitle QFs to contract rates set at the utilities' full avoided costs. See 18
C.F.R. § 292.304(a); See FERC Order No. 69, 45 Fed. Reg. 12,214, 12,222-12,223 (Feb.
25, 1980). FERC's regulations require utilities to publish "stadard rates" for QFs with a
generating capacity of 100 kilowatts (which is 0.1 MW), and FERC permits state utility
commissions to require utilties in the state to provide published rates available to QFs
with capacity greater than 100 kilowatts. 18 C.F.R. § 292.304(c)(I)-(3).
In Idaho, the Commission possesses jurisdiction to set PURP A avoided cost rates
and order public utilities to enter into avoided cost rate contracts with QFs. LC. §§ 61-
129, -501. -502, -503, -612; see also Afton Energy Inc. v. Idaho Power Co., 111 Idaho
925,929, 729 P. 2d 400,404 (1986). Curently, the Commission requires utilities in Idaho
to make the rates in the published rate schedule available to QFs that generate an average of
10 MW or less if total monthy generation capacity is averaged over that month. See Order
ANSWER IN OPPOSITION TO JOINT MOTION TO ADJUST PUBLISHED
AVOIDED COST RATE ELIGIBILITY CAP
PAGE - 2
No. 29632, Case No. IPC-E-04-8, at p. 14 (November 22,2004). For projects under that
threshold, the Commission has calculated the published rates since 2002 using a
surogate avoided resource (or "SAR") methodology "based on the estimated costs that a
utilty would incur in constructing a natural gas-fired combine cycle combustion turbine
("CCCT") power plant." Order No. 30873, at p. 3.
In August 2009, the Commission opened a case regarding a proposal to change
the surogate avoided resource from a natural gas plant to a wind energy generating
facility. Order No. 30873, Case No. GNR-E-09-03, at p. 3 (August 6, 2009). The
utilities' initial round of comments proposed abandoning the published, natural gas
CCCT SAR methodology for all QFs, and replacing it with a utilty-built wind far as
the SAR utilized to calculate avoided cost rates. See, e.g. Comments of Idaho Power
Company and Avista Utilties, Case No. GNR-E-09-03, at pp. 4-5 (September 8, 2009).
According to Idaho Power and Avista, the gas CCCT SAR was providing QFs with an
avoided cost rate that was higher than rates awarded to wind energy projects acquired
through competitive bidding processes. Id
At the direction of the Commission, Staff prepared a straw man wind SAR
proposal earlier this year. See Decision Memorandum of Staff Case No. GNR-E-09-03,
p. 1 (November 5, 2010). On November 3, 2010, the Commission Staff convened a
workshop to discuss the strengths and weakesses of the wind SAR straw man proposal
and to discuss other proposals of the paries. Id at p. 2. By Decision Memorandum fied
last week, Staff represented to the Commission that "at the conclusion of the November 3,
2010 workshop while it seems the parties were in agreement that continued discussions
should occur on some level it was agreed that there was no appetite for further discussions of
Staffs straw man proposaL." Id Staff therefore recommended vacating the comment
ANSWER IN OPPOSITION TO JOINT MOTION TO ADJUST PUBLISHED
AVOIDED COST RATE ELIGIBILITY CAP
PAGE - 3
deadline on the wind SAR currently stil set for November 27,2010, but provided no further
procedural recommendations.
A few days later before the Commission has even addressed Staff s recommendation
to abandon the wind SAR straw man, Idaho Power, Avista, and Rocky Mountain Power fied
a Joint Petition to address a broad spectrum of QF issues, and a Joint Motion requesting an
immediate interlocutory order reducing the eligibilty cap for published avoided cost rates
from 10 aMW to 100 kw of nameplate capacity for all QF resources. See Joint Petition and
Joint Motion, Case No. GNR-E-10-04 (November 5, 2010). The Joint Motion and its single
attchment provided no testimony or other admissible evidence whatsoever in support of its
claims. Nevertheless, the utilities allude to Commission Rule of Procedure 256 (lDAPA
31.01.01.331.256), and request that "the Commission tae immediate action upon the
Motion, on fewer than foureen days notice, if possible." But the utilies have not argued
how their fiing complies with the requirements of Rule 256 for issuing an order on less
than 14 days notice to all parties - indeed, the Joint Motion does not even state the test
for issuing such an order as set forth in Rule 256.02.
ANSWER IN OPPOSITION TO JOINT MOTION TO ADJUST PUBLISHED
AVOIDED COST RATE ELIGIBILITY CAP
PAGE-4
ANSWER
For the reasons set forth below, the Joint Motion for interlocutory order
immediately dropping the eligibility cap for published avoided cost rates for all QF
resources in Idaho fails the procedural and substantive requirements for such an order on
less than 14 days' notice, and should be denied.
A. The Joint Motion has not satisfied the procedural requirements for the
Commission to issue an order on less than 14 days' notice, and without opportunity
for all interested parties to comment.
1. The rules applicable to requests for immediate substantive relief
require notice and opportunity to be heard to all adverse partes, or
posting of a bond if immediate, irreparable harm wil occur and such
notice in impracticable.
Although the Commission's Rules of Procedure do not set forth a stadard
directly addressing a motion for immediate relief, the Idaho Rules of Civil Procedure
provide standards for the Commission to apply. The Idaho Rules of Civil Procedural
allow for issuance of a temporar restraining order. See LR.C.P. 65(b). But such an
order "can be issued without notice only if it 'clearly appears from specific facts shown
!l a(fdavit or !l the verified complaint that immediate and irreparable injur, loss, or
damage will result to the applicant before the adverse pary or the part's attorney can be
heard in opposition.''' Allbright v. Allbright, 147 Idaho 752, 753, 215 P.3d 472, 475
(2009) (quoting LR.CP. 65(b)). Furher, "Subsection (c) requires an applicant for a
restraining order or preliminar injunction to provide security 'for the payment of such
costs and damages including reasonable attorney's fees to be fixed by the cour, as may
be incured or suffered by any pary who is found to have been wrongfully enjoined or
restrained.''' Id (quoting LR.C.P. 65(c)). This bond requirement is obviously designed
ANSWER IN OPPOSITION TO JOINT MOTION TO ADJUST PUBLISHED
AVOIDED COST RATE ELIGIBILITY CAP
PAGE - 5
to prevent paries from using a temporary restraining order or preliminar injunction to
cause financial har to adverse paries in time-sensitive matters.
Furer, LR.C.P. 65(a) provides, "No preliminar injunction shall be issued
without notice to the adverse par." Indeed, the Idaho Supreme Cour has long rejected
attempts to issue a preliminar injunction without providing the adverse party an
opportunity to present its case in opposition. See, e.g., Lawrence Warehouse Co. v.
Rudio Lumber Co., 89 Idaho 389, 396, 405 P.2d 634 (1965). "The issuance of a
preliminar injunction under such circumstaces is contrar not only to the Rules of Civil
Procedure but also to the spirit which imbues our judicial tribunals prohibiting decision
without hearing." Id (internal quotation omitted). The Cour went on to declare, "Notice
implies an opportunity to be heard. . . . Trial of an issue of fact necessitates opportunty to
present evidence and not by only one side to the controversy." Id (internal quotation
omitted). In short, "Timely notice and an opportunty to be heard are of the essence of
due process, and are jurisdictional essentials of a valid judgment." Id at 398.
The Commission's Procedural Rule 256 - cited by the Joint Motion at issue -
only addresses pre-hearing motions in general, and does not specifically address motions
for immediate substantive relief requested with an initial pleading. Yet even Rule 256.02
provides:
Requirements for Motion for Expeditious Substantive Relief. A
motion requesting substantive relief on fewer than foureen (14) days'
notice wil not be acted upon on fewer than fourteen (14) days' notice
unless it states: a. The facts supporting its request to act on shorter notice;
and b. 1) That at least one (1) representative of all parties has received
actual notice of the motion, by telephone or personal delivery of the
motion; or 2) stating the efforts made to reach representatives of those
paries not contacted and what efforts will continue to be made to contact
them... .
ANSWER IN OPPOSITION TO JOINT MOTION TO ADJUST PUBLISHED
AVOIDED COST RATE ELIGIBILITY CAP
PAGE - 6
IDAPA 31.01.01.331.256.02.1
. Thus, even this rue of general applicability requires notice and an opportunity to be
heard for all paries adverse to a motion for expedited ruling.
2. The Joint Motion does not demonstrate that it has been served on all
adverse parties on the date on the certifcate of service - November 5, 2010.
The utilities have posted no bond, and offered no evidence of irreparable har.
Thus, regardless of which stadard the Commission applies, it is clear that without
providing both a bond and evidence demonstrating irreparable and immediate har, the
Joint Motion must demonstrate that it was served on all paries adverse to the motion for
immediate relief.
The Joint Motion asserts that many paries are engaged at various stages of
negotiations with the utilties for PP As containing the published avoided cost rates.
Obviously, any pary curently seeking a PPA with the existing published rates would be
adversely affected by a drop in the eligibility cap from 10 aMW to 100 kw. Indeed,
almost no QFs are sized under 100 kw, and it is safe to assume that every single QF
engaged in negotiation with the utilities would be adversely affected by the substantive
relief sought by the utilities. Timing for a renewable energy project is very important,
and a delay in obtaining a PPA can completely undermine the economics of a project.
This is so because of expiring ta credits, permits, financing opportunties, and many
other factors. Thus, even a temporar drop in the eligibility cap lasting only a few weeks
or months is likely to permanently render uneconomical many QF projects curently
Although Rule 256.03 allows for a more expedited process for "Procedural
Relief," the Joint Motion does not argue, and no reasonable person could conclude, that
an order dropping the eligibility cap for availability of the published avoided cost rates
would constitute procedural relief. Thus, the utilities' Joint Motion canot be granted
under Rule 256.03.
ANSWER IN OPPOSITION TO JOINT MOTION TO ADJUST PUBLISHED
AVOIDED COST RATE ELIGIBILITY CAP
PAGE -7
engaged in negotiations with the utilities. Paricularly troubling is the fact that the
request for a drop in the eligibility cap is not limited solely to wind QFs. Clearly then,
the parties adverse to the Joint Motion include all QFs or prospective QFs currently
engaged in negotiations with the utilities.
Yet the utilities only served the Joint Motion on "paries, intervenors, and paries
that filed comments in the Wind SAR case, Docket No. GNR-E-09-03." Joint Petition
and Joint Motion, at p. 7. That docket addressed issues predominantly of interest to Wind
QFs. Although QFs developing and operating other resource types paricipated, all QFs
curently engaged in negotiations with the utilities did not paricipate in GNR-E-09-03,
and were not among the paries to whom the Joint Motion states the utilities provided
notice.2 The utilities have therefore failed to adequately demonstrate that they provided
actual notice by telephone or personnel delivery of the motion to all adverse paries to
their motion for immediate substative relief. If the Commission were to grant the
motion without requiring additional notice, many paries who are engaged in the
contracting process for varous types of QF resources - small hydropower, co-generation,
biomass, waste-to-energy, wind, etc. - wil be unable to provide the Commission with
information on how the requested drop in the eligibility cap wil affect their ability to
bring these valuable resources online. The Commission should require the utilities to
serve their Joint Motion on all QFs currently engaged in negotiations for an Idaho
2 Indeed, the Joint Motion - which purorts to have arsen out the November 3
wind SAR workshop - does not even state that the utilities served it on all paries who
paricipated in that workshop. Many paries who did not formally intervene, file
comments, or otherwise obtain party status in the wind SAR docket nonetheless
paricipated in the November 3 workshop, and paries at the workshop filled in their
contact information on sheet circulated by Commission Staff. The utilities' failure to
provide notice of the Joint Motion to all paries who attended the November 3 workshop
fuher demonstrates the infirmity of their filing.
ANSWER IN OPPOSITION TO JOINT MOTION TO ADJUST PUBLISHED
AVOIDED COST RATE ELIGIBILITY CAP
PAGE- 8
PURPAPPA.
Furhermore, even Rule 256.02 requires that the utilties provide actual notice to
begin the ruing of the time periods therein. The utilities certificate of service states
that it is effective for filing puroses on November 5, 2010. But the utilities did not
provide actual notice of the Joint Motion to the undersigned counsel until after the close
of business on Friday, November 5, 2010, at 5:15 p.m. See NIPPC's Attachment 1.
Thus, even if the paricipants to Case No. GNR-E-09-03 were the universe of adverse
paries to the Joint Motion, the utilities' notice would not be effective for puroses of
Rule 256.02 until Monday, November 8, 2010, because the fiing of a motion pursuat to
Rule 256 canot be effective on a Saturday or Sunday. See IDAPA 31.01.01.331.017
(excluding weekends as days for puroses of computing time for certain puroses);
IDAPA 31.01.01.331.256.02 (excluding weekends for puroses of computing time-
period to rule on expedited pre-hearing motion).
3. The Commission should allow a reasonable time for all adverse
parties to present evidence or argument in opposition to a reduction in
the eligibilty cap for the published avoided cost rates.
Make no mistae about it; the utilities seek a long term moratorium on their
obligation to purchase the output of any new QF projects. The last moratorium applied
only to Wind QFs, but this time the utilities seek a moratorium applicable to all QFs.
Once in place, such a drop in the eligibility cap is likely to remain in place for a many
months, and likely years. The implications on the renewable energy industr will be
widespread and have impacts on the entire economy of Idaho. This drastic step would
eliminate the PURP A market in Idaho, and as a matter of simple fairness the Commission
should allow a reasonable time for all potentially interested entities to weigh in prior to
ANSWER IN OPPOSITION TO JOINT MOTION TO ADJUST PUBLISHED
AVOIDED COST RATE ELIGIBILITY CAP
PAGE-9
issuing a decision. NIPPC proposes that the Commission not rule on the Joint Motion for
an interlocutory order until at least 14 days after the utilties have provided notice to all
QFs curently engaged in negotiations with the utilities, and until after the Commission
has allowed for a reasonable time-period for all interested paries to be heard by written
or oral comments.
B. The Joint Motion has not satisfied the substantive standards the Commission
should require for such a sweeping and immediate order.
As stated above, the Joint Motion contains statements unsupported by evidence,
and a single attachment setting forth the amount of wind capacity Idaho Power has
online, under contract, and in negotiation. There is no evidence whatsoever submitted by
the utilities - no pre-filed testimony, and no indication of which witnesses could support
the statements in or the attachment to the filing. The Joint Motion states that Idaho
Power has 208 MW operating on its system today, has over 264 MW of Commission-
approved QF wind contracts, and an 80 MW wind QF contract awaiting Commission
approval. Joint Petition and Joint Motion, at p. 4. It speculates as to the amount of wind
that Idaho Power could have online if all wind QFs curently engaged in "requests" for
contracts were to reach commercial operation, but provides no evidence that these
projects are mature enough to receive a contract which would some day be approved by
the Commission. Id
The case for Rocky Mountain Power's need for an immediate ruling is entirely
unconvincing. The Joint Motion states Rocky Mountain Power has 64 MW of wind QF
contracts executed, but none online. Id It also states Rocky Mountain Power has
another 358 MW of standard wind QF contracts proposed. Id There is no evidence
presented as to the level of matuty of any of these allegedly proposed projects. This is
ANSWER IN OPPOSITION TO JOINT MOTION TO ADJUST PUBLISHED
AVOIDED COST RATE ELIGIBILITY CAP
PAGE - 10
hardly an overwhelming amount for Rocky Mountain Power, which as part of PacifiCorp
is a much larger utility.
The case for Avista is non-existent. The Joint Motion does not state that Avista
has any wind QFs online whatsoever. Indeed, Avista has not fied for approval of any
wind QF PPAs. It is unclear how Avista has any potential injur whatsoever.
In short, the Joint Motion contains insufficient evidence of irreparable har
waranting a blanet reduction in the eligibilty cap for the utilties' obligation to make
the published avoided cost rates available to all QF resource types. The Commission
should therefore reject the Joint Motion for reduction in the eligibilty cap, and should
instead require the utilities to provide notice to all QFs currently engaged in negotiations
and process the petition addressing the various QF issues as it would any other petition.
CONCLUSION
For all the reasons set forth above, NIPPC respectfully requests that the
Commission deny the Joint Motion for expedited ruling on less than 14 days' notice. The
sky is not falling, and the Commission should tae the time to allow all interested paries
to express their positions prior to takng any drastic steps such as lowering the eligibilty
cap on the published avoided cost rates to 100 kilowatt.
ANSWER IN OPPOSITION TO JOINT MOTION TO ADJUST PUBLISHED
AVOIDED COST RATE ELIGIBILITY CAP
PAGE -11
.f~
Respectfully submitted this g '(ay of November 2010.
RICHARSON AND O'LEARY, PLLCi?(l~Peter J. Richardson (ISB No: 3195)
Gregory M. Adams (ISB No. 7454)
Attorneys for the Nortwest and
Intermountain Power Producers Coalition
ANSWER IN OPPOSITION TO JOINT MOTION TO ADJUST PUBLISHED
AVOIDED COST RATE ELIGIBILITY CAP
PAGE-12
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on the 8th day of November, 2010, a true and correct
copy of the within and foregoing ANSWER IN OPPOSITION TO JOINT MOTION
TO ADJUST PUBLISHED AVOIDED COST RATE ELIGIBILITY CAP
BY THE NORTHWEST AND INTERMOUNTAIN POWER PRODUCERS
COALITION was served by ELECTRONIC MAIL and US MAIL, to:
Donovan E. Walker
Lisa Nordstrom
Idaho Power Company
1221 West Idaho Street
Boise, Idaho 83707-0070
dwalker(gidahopower .com
lnordstrom(gidahopower .com
Daniel E. Solander
Rocky Mountain Power
201 South Main
Salt Lake City, UT 84111
Daniel.solander(gpacificorp.com
Michael G. Andrea
A vista Corporation
1411 East Mission Avenue - MSC-23
Spokane, W A 99202
Michael.andrea(gavistacorp.com
ANSWER IN OPPOSITION TO JOINT MOTION TO ADJUST PUBLISHED
AVOIDED COST RATE ELIGIBILITY CAP
PAGE -13
IDAHO PUBLIC UTILITIES COMMISSION
CASE NO. GNR-E-I0-04
NORTHWEST AND INTERMOUNTAIN POWER
PRODUCERS COALITION'S
ANSWER IN OPPOSITION TO JOINT MOTION TO ADJUST
PUBLISHED AVOIDED COST RATE ELIGIBILITY CAP
ATTACHMENT NO.1
November 8, 2010
Greg Adams
From:
Sent:
To:
Bearry, Christa rCBearrycæc(power.comi
Friday, November OS, 201 5: 1 ~
scott.woodburycæpuc.idaho.gov; 'Andrea, Michael'; 'Kalich, Clint'; 'Daniel Solander
(DanieI.SolandercæPacifiCorp.com)'; 'Griswold, Bruce tMkt Functionl';
'ted.westoncæpacificorp.com'; Peter Richardson; Greg Adams; Don Reading; 'Joe Miller';
'glennicæpacbell. net'; 'nelsoncæthnelson. com'; 'jravenesanmarcoscæyahoo.com';
'tedcætsorenson. net'; 'Iynnharmoncæcableone. net'; 'arronesqcæaol.com';
'bottocæidahoconservation.org'; 'tunupajohncæmsn. com'; 'markooshcæmagiclink. com';
'Izamoracætfcanal.com'
Walker, Donovan
GNR-E-10-04 - Adjust Avoided Cost Rate Eligibility Cap
IPCO-Avista-Rocky Mountain - Joint Petition and Motion Avoided Cost (00044627). PDF
Cc:
Subject:
Attachments:
Attached is Idaho Power Company, Avista Corporation, and Rocky Mountain Power's Joint Petition to Address Avoided
Cost Issues and Joint Motion to Adjust the Published Avoided Cost Rate Eligibilty Cap. This Joint Petition was filed with
the Idaho Public Utilities Commission today.
Christa
Christa Bear
Legal Administrative Assistant
Idaho Power Company
P.O. Box 70
Boise, Idaho 83707
Telephone: [phone]
E-mail: cbeary(gidahopower.com
~
This trsmission may contain information that is privileged, confidential and/or exempt from disclosure under applicable law. If you are not the intended recipient, you ar hereby
notified that any disclosure, copying, distribution, or use of the information contained herein (including any reliance thereon) is STRICTLY PROHIBITED. If you received this
transmission in error, please immediately contact the sender and destroy the material in its entirety, whether in electronic or hard copy format. Thank you.
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