20110121Reply Comments.pdf

Thomas H. Nelson, ISB 7034
PO Box 1211
Welches, OR 97C17
Tel: [phone]
Email: nelson~thnelson.com
Atorney for Renewable Energy Coalition
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BEFORE THE IDAHO PUBLIC UTiliTIES COMMISSION
IN THE MATTER OF THE JOINT
PETITION OF IDAHO POWER CASE NO. GNR-E-1Q-
COMPANY, AVISTA CORPORATION,
AND ROCKY MOUNTAIN POWER TO RENEWABLE ENERGY COALITION'S
ADDRESS AVOIDED COST ISSUES REPLY COMMENTS
AND JOINT MOTION TO ADJUST
THE PUBLISHED AVOIDED COST
RATE ELIGIBILITY CAP
Introducton an Background
In response to th Joint Petition of the captioned utilities and to the Stafs and
other partes' initial coments, the Reneble Energy Coalition ("Coalition") provides
the following reply comments.
The Joint Utilties sek immediate redudion of the eligibility cap for published
avoide-cst prices from 10 average megawatts ("aMW) to 100 kilowatts ("kW) while
the Commission studies numerous issues raise during the November 3, 2010,
workshop in Case No. GNR-E-D9-D3. Although from the utilties' filings it appears that
wind preds (and particularly thse on the Idaho Powr system) are the major cause
for the utilties' cocern, the propose redudion would apply to all types of qualifing
facility ("OF") tecnology; even small base-oa hydroeleric prjeds, both existing and
new, would be afeded by th propose lower eligibility ca.
GNR-E-1Q-: REPLY COMMENTS OF RENEWABLE ENERGY COALITION - i
In Order No. 32131 the Commission direced the parties to address three issues
in their initial comments: (1) the advisability of reducng the published avoided-cst
eligibilty ca, (2) if the eligibilit cap is reduce, the propriety of exempting non-wind OF
projecs from the reduce eligibilty cap, and (3) the coueces of diviing larger
wind projeds into projecs not larger than 10-aMW projecs in order to qualify for the
published rae. The Commission noted th its fuure decsion on the prse eligibility
cap would be applied retadively to Dember 3, 2010.
The Joint Utilities' initial comments continue to suppo an immediately efecve.
all-inclusive redudion of the eligibilty cap down to 10OkW, and subjec to revision only
afer investigation of a lon list of coplex avoide an PURPA implemetation
issues. It appars that the motivation of the thre utilties is to reduce avoided-cst
price and creat a crppling peod of regulatory uncainty fo OF proj owrs and
developers; the utilties' suggestion would subj small baseload projecs to the
chllenges assoated with the unavailabilty of published prces. If implemeted. the
utilties' proposals would result in curtailed development of renewable energy
technologies and projes. Th Coalition joins with othr part in oppoing th
lowering of the eligibilty cap.
The Coiti'. Reply to Commts an Suggeson for Moving Forward
A The Coalition's Response to Stafs Comments
Th Coalition appreates and gerally agree with the Stafs inital coments.
The points of agrement include (1) that wind and only wind projecs are the cause for
cocern in this doet, (2) that non-wind proje should be exclud frm cosideration
of a lower eligibilty cap, (3) that only wind-spec avoided-cst issues should be
GNR-E-1D-: REPLY COMMENTS OF RENEWABLE ENERGY COALITION - 2
investigated during the perod of a lowred eligibilty cap (assuming the cap is
retroadively appied to December 3, 2010), (4) that thre are numerous approaches to
be explored in mitigating the problem of rapid overdevelopment of large commercial
wind projecs that qualif for published price, and (5) that small projecs generally
have limited resourcs and ofen insufcient sophistication to deal with negotiating
contrads and prices, particularly when complex models are employed to determine
those prices.
B. Ihe Coalition's Suggestions
1. Consider Modifying the Eligibilty Cap for to Cover Wind Only
No party has presented substantial evidence or covincing argumens to justif
the propsed reduction of the eligibilty cap for all projeds. The Staf corredly notes
that the utilties' arguments are not direced at all OF tecnology tys but, rather, only
at large wind-pred projecs, and that, although many of the concerns identifed by
the parties during the prior wokshops are germne to all resource types, the isses that
are both the most problematic and most in need of immediate attention pertain almost
exclusively to wind. Th Stafs comments clealy ilustrate that large-scale wind
projeds only are the source of the utilties' cocerns. and the Coalition endorses the
Stafs suggestion that the Commission's decision in this docet should not go beyond
cosidering lowering the eligibilty cap for wind projecs only - but in no circumstances
to the extemely low level of 100 kW and then only if other short-term remedies are
deemed impradical.
GNR-E-1 Q-: REPLY COMMENTS OF RENEWABLE ENERGY COALITION - 3
2. Limit the Duration and Scope of the Investigation
Althug there ar numerus avoidedst an PURPA implemention issues
raised by and involved in the currnt and prior similar docets, this phase of the
investigation should not atempt to addss all reso types; rath, it shd be
limited to wind-only issues. Examples of ancillary issues that should be set aside for the
time being inclde stand contct, owerip of environmental attbutes, and
interconnedion problems.
While th Stafs initial comets gerally suprt limiting th initial phas of
the investigation to those questions that are causing immediate problems for the
utilities, so of its comets adres specic concets in an ef to advanc th
discussions. Most of these comments appear to have some merit, are generally
applicable to long-term solutons. may not repeset th coplee menu of possible
solutions, and could be interpreted in some cases to apply to non-wind projecs. The
Coalition apprates thse coces fo possible long.term solutons bu suggests th
short-term solutions be given priority consideration. It is crtical to minimize the duration
and impa of relator unceainly. an there prmary attentio shold be given to
the concepts that address the immediate problems describe by the utilities;
considerati of longer-term options shld be deerred. For example, the Comission
might (1) impose a temporary limitation on the number or the average MW of wind
project a utlity might contra with or for. (2) shif temporarily to the use of namelate
capacity in lieu of average MW to determine eligibilty, or (3) temporarily employ
Oregon's fie-ile reulatory sceme und which geraphic searation is required to
qualify for published avoidedst prces.
GNR..E..1D-: REPLY COMMENTS OF RENEWABLE ENERGY COALITION. 4
Exrience has shown that negotiating power-purchase agreements not eligible
for puishe avodest prces is extely problematic. time-nsuming, expsive,
and untimely in ters of projec development schedules: Only two such contrads have
ben execed an apved sinc the Commission bean implemnting PURPA in the
early 198s. Consequently, in order to presere the possibility of a viable renewable-
resrce industr, loner.ter solutons shold not involve lowring the eligibilit ca,
particularly when other, less drastic means are available to deal with the problem
prested.
Finally, the Coalition notes that there has be no demonstration of the "magnet
effec. that reucng Idaho Pows eligibilit ca would have on the tw other utilties;
until such a problem adually arises the Coalition urges that a lower cap not be applied
to those utilties. Only poential large wind prec are ambulator, i.e.. can be
relocted from place to place without much diffculty; other types of renewable
reouce such as hydrolecric an biomass are restcted to paicular georaic
areas becuse of motive forcelfuel considerations, and large solar projecs are difcult if
not impoible to relote. Thus the Stafs corn rearding the "shong. for
utilities with the most attractive rate and highest eligibility cap arises only in regard to
wind projecs. Hampeng PURPA implemntation shold not ocr until Rocy
Mountain Power and Avista Corporation adually experience problems from the
relotion of a Signicant number of wind projecs fro Idaho Powr's territor to thirs.
This docket is evidence that the Commission has all the tools necessary to deal
efively with such a problem if it ocrs; as it is, th prposal to appy the eligibilty
cap to all three utilities is a solution looking for a problem.
GNR-E-1D-: REPLY COMMENTS OF RENEWABLE ENERGY COALITION - 5
Summary
There is insucient evidence in this docet to supprt th reudion of the
eligibilty cap to 100kW for non-wind projecs, and therefore the Coalition heartily
endorses the Staffs suggstion th the initial phase of this investigation be applicable
to wind projeds only. Finally, the Coalition encourages the Commission to consider
taking steps to redce the scope and duraton of the investigation while long-term
solutions are examined and pursed; any restridions impoed on projs should be
short-term in nature only until longer-ter solutions are implemented.
Respelly suit, . J)II~
IsI~H. N~yr. .
Thomas H. Nelson, ISB 7034
PO Box 1211
Welches, OR 97C17
Tel: [phone]
Email: nelson~thnelson.com
Attorney, Renble Energy Coalition
GNR-E-10-D: REPLY COMMENTS OF RENEWABLE ENERGY COALITION - 6
CERnFICATE OF SERVICE
l hereby certfy tht I have on this 19t day of January, 2011. I seed a copy of
the foregoing Reply Comments of Renewable Energy Coalition on the entities
designed as serv by the Joint Petitionrs in th caione doet by serving an
eledronic copy on their email addresses of recrd as set fort below. The original and
seven (7) copies of this doment were filed with the Commission eleonically and by
United States Mail, postage prepaid, on the 19t day of January, 2011.
IDAHO PUBLIC UTILITY COMMISSION
Jean Jewell, Secetary
Idaho Public Utilities Commission
472 West Washington Street
PO Box 83720
Boise, ID 83720-074
jjewell~pu.state.id.us
IDAHO POWER COMPANY:
Donovan E. Walker
Usa D. Nordstrom
ida Power Compny
PO Box 70
Boise, ID 83707-070
E-mail: dwalker~idahopoer.comInordstromOidah.co
PACIFICORP, dba ROCKY
MOUNTAIN POWER:
(Exibit No. 201-30)
Denel Solander
PacCor db Rocy Mountain Powr
201 S. Main St., Suite 230
Salt Lake Cit, UT 84111
E-mail: daniel.solander~pacicorp.com
CERTIFICATE OF SERVICE - 1
AVISTA CORPORATION:
Michl G. Anrea
Avista Corpration
1411 E. Mission Ave.
Spokane, W A 99202
E-mail: michael.andreaOavistao.co
COMMISSION STAFF:
Donald L. Howell, II
Kristine A Sa
Deputy Attornys General
Idaho Public Utilties Commission
472 W. Washington (83702)
PO Box 83720
Boise, ID 83720-74
E-mail: do.hoIIOpuc.idaho.gov
kris.sasser~puc.idaho.gov
J.R. SIMPLOT COMPANY:
Peter J. Richardson
Gregor M. Adams
Richardson & O'Leary, PLLC
PO Box 7218
Boise, ID 83702
E-mil: peOrichrdsonandolear.com
greg~richardsonandolear.com
THE NORTHWEST AND
INTERMOUNTAIN POWER
PRODUCERS COALITION:
Peter J. Richrdson
Gregory M. Adams
Richardson & O'lea, PLlC
PO Box 7218
Boise, ID 83702
E-mail: peter~richardsonandolear.com
greg~richrdsoandolery.com
Robrt D. Kahn
Executive Direcor
Norst and Interountain Power
Producers Coalition
117 Minor Ave., Suite 30
Seattle, WA 98101
E-mail: rkahnOnippc.org
GRAND VIEW SOLAR II:
Peter J. Richardson
Greor M. Adams
Richardson & O'Leary, PLLC
PO Box 7218
Boise, ID 83702
E-mail: peterOrichrdsonandolear.com
9reg~richardsonandolear.com
Robe A. Paul
Grand View Solar II
1596 Vista Circle
Desert Hot Springs, CA
E-mail: robertlOgmail.com
CEDAR CREEK WIND, LLC:
Ronald L. Willams
Willams Bradbury, P.C.
1015 W. Hays Stret
Boise, 10 83702
E-mail: ronOwllamsbrury.com
CERTIFICATE OF SERVICE - 2
Don Sturtevant
Energy Diredor
J. R. Simplot Company
PO Box 27
Boise, ID 83707-027
E-mail: don.stuevantOsimplol.co
EXERGY DEVELOPMENT
GROUP OF IDAHO, LLC:
Peter J. Richardson
Gregry M. Adms
Richardson & O'Leary, PLLC
PO Box 7218
Boise, ID 83702
E-mail: peter~chrdsonndolea.com
greg~richardsonandolear.com
James Carkulis
Managing Member
Ener9Y Development Group of Idaho, LLC
802 W. Bannoc St., Suite 1200
Boise, ID 83702
E-mail: jcarkulisOexergydevelopment.com
INTERMOUNTAIN WIND, LLC:
Dana Zentz
Vice Presdent
Summit Power Group, Inc.
200 E. Westminster
Spokane, W A 99223
E-mail: dzentzsummitpr.com
Dean J. Miler
McDevitt & Miler, LLP
PO Box 256
Boise, ID 83701
E-mail: joeOmcdvitt-mìllr.co
Paul Main
Intermountain Wind, LLC
PO Box 35
Boulder, CO 80306
E-mail: paulmartinGntermountainwind.
Scott Montgomery
President
Cedar Creek Wind, LLC66 Roc Dr.
Nort Salt Lake, UT 84054
E-mail: sctttmesemeergy.us
INTERCONNECT SOLAR
DEVELOPMENT LLC:
R. Greg Ferney
Mimura La Ofces, PLLC
2176 E. Franklin Rd., Suite 120
Meridian, 10 83
E-mail: greg~mimuralaw.com
Bil Piske, Manager
Inteconn Solar Deveopment, LLC
1303 E. Carter
Boise, 10 83706
E-mail: bilpiske~cableone.net
THE BOARD OF COMMISSIONERS OF
ADAMS COUNTY, IDAHO:
Peter J. Richaron
Gregory M. Adams
Richardson & OILear, PLLC
PO Box 7218
Boise, ID 83702
E-mail: peter~richardsonandolear.com
gregOichardsonandlear.com
Bil Brow, Chair
Board of Commissioners
of Adams County, 10
PO Box 48
Council, 10 8312
E-mail: dbbrown~ontiernet.net
CERTIFICATE OF SERVICE.. 3
DYNAMIS ENERGY, LLC:
Ronald L. Wiliams
Willams Bradbury, P.C.
1015 W. Hays Street
Boise, ID 83702
E-mail: rocmmamsbradbury.com
Wade Thomas
General Counse
Dynamis Energy, LLC
776 W. Riversde Dr., Suite 15
Eagle, ID 83616
E-mail: wthomasOdynamisenerg.com
NORTH SIDE CANA COMPANY
TWN FALLS CANAL COMPANY:
Shelley M. Davis
Barker Rosholt & Simpson, LLP
1010 W. Jeffrso St. (83702)
PO Box 2139
Boise, fO 83701
E-mail: smd~idahowaters.com
Brian Olmstead
General Manager
Twin Falls Canal Company
PO Box 326
Twin Falls, 10 8330
E-mail: olmstead~tfcanal.com
Ted Diehl
General Maagr
North Side Canal Company
921 N. Lincln St.
Jerome, ID 83338
E-mail: nsclOcableone.net
BIRCH POWER COMPANY:
Ted S. Sornson, P.E.
Birch Power Company
5203 Soth 11 th East
Idaho Falls, ID 834
E-mail: tedOtsso.net
This Certficate of Servce is executed on January 19, 2011, at Zigzag, Oregon.
Thomas H. Nelson
PO Box 1211
Welches, OR 97C17 -1211
Tel: [phone]
Cell: 503.709.6397
E-Mail: nelsonænthnelson.com
Attorey, Renele Energ Coalition
CERTIFICATE OF SERVICE - 4