20110422Decker Reb.pdf

McDevitt & Miller LLP
Lawyers
[phone]
[phone] (Fax)
420 W. Bannock Street
P.O. Box 2564-83701
Boise, Idaho 83702
Chas. F. McDevitt
Dean J. (Joe) Miler
Apri 22, 2011
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Via Hand Delivery
Jean Jewell, Secretar
Idaho Public U titiès Commssion
472 W. Washigton St.
Boise, Idao 83720
Re: GNR-E-11-01
Renewable Nortwest Project
Dear Ms. Jewell:
Enclosed for fig, please fid nie (9) copies of the Rebutt Testiony of Mega Decker on
behalf of Renewable Nortwest Project and exhibits, with one copy designated as the "Reporter's
Copy." A compact disk contag the Direct Testiony and exhbits of the above-named witness
is also enclosed.
Kidly retu a fie stamped copy to me.
Very Truy Yours,
McDevitt & Mier UP
~~WL
DJM/hh
Enclosures
4.
,
RECEIVED COpy
Dean J. Miller (ISB No. 1968)
Chas. F. McDevitt (ISB No. 835) iOI' APR 22 AM 10: 40
McDEVITT & MILLER LLP
420 West Banock Street
P.O. Box 2564-83701
Boise, il 83702
Tel: [phone]
Fax: [phone]
joe(ßcdevitt -miler. com
chas(fmcdevitt-miller.com
Attorneys for Renewable Northwest Project
BEFORE THE IDAHO PUBLIC UTILITIES COMMSSION
IN THE MATTER OF THE
COMMSSION'S INVSTIGATION
INTO DISAGGREGATION AND
AN APPROPRIATE PUBLISHED
AVOIDED COST RATE
ELIGIBILITY CAP STRUCTURE
Case No. GNR-E-ll-Ol
REBUTTAL TESTIMONY OF MEGAN DECKER
ON BEHALF OF RENEWABLE NORTHWEST PROJECT
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PLEASE STATE YOUR NAME
My Name is Megan Decker.
AR YOU THE SAME MEGAN DECKER WHO SUBMITTED DIRCT PRE-
FILED TESTIMONY IN THIS MATTER?
Yes, I am.
WHAT IS THE PURPOSE OF YOUR REBUTTAL TESTIMONY?
I wil discuss proposals for development of a "single QF rule" that have been submitted
in this docket by Staff the Idaho Conservation League and Rocky Mountain Power and
offer suggestions for improvements to the Staff and Rocky Mountain proposals.
WHAT IS THE PURPOSE OF DEVELOPING A FRAEWORK TO DISTINGUISH
BETWEEN SINGLE AND MULTIPLE PROJECTS?
The purpose of adopting such a framework would be to prevent large projects from
gaining access to published rates by disaggregating, while retaining availability of
published rates for smaller projects that have less economic power to negotiate avoided
cost rates. See Idaho Public Utilties Commission, Order No. 32176, page 11. Any
framework must strke a balance between those two principles. (A future phase of this
proceeding should address the reasonableness of the curent system for negotiating
avoided cost rates for PURP A projects above 10 aMW.) I recognize the challenge in
strctung a framework that successfully restricts large, disaggregated projects from
access to published rates without being so restrictive that single, smaller projects are also
captured and eliminated from eligibility. But the Commission should take care not to err
too far on the side of restrctiveness. Paying attention to how the framework affects
CASE NO. GNR-R-1 1-01
April 22, 201 1
Decker, R (Di)2
Renewable Nortwest Project
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single, smaller renewable energy projects is necessar to carng out the dual puroses
for adopting the framework.
HOW DO YOU CHARACTERIZE THE METHODOLOGY REFLECTED IN THE
PROPOSALS PUTFORWARD IN THIS DOCKET?
As I explained in my Direct Testimony, the identity of the decision maker and the amount
of discretion available to that decision maker are the most signficant featues of a
framework for distinguishing between single and multiple projects. (Decker, Di - Page
10, Line 20 though Page 11, Line 20.) The "Single Project Requirement" proposed in
Exhibit No. 301 to the Direct Testimony of Rick Sterling on behalf of Staff of the Idaho
Public Utilties Commission ("Staffs Proposal") gives nearly absolute discretion to the
utilities and the Commission in applying a broad list of factors. The "Proposed Criteria
for Published Avoided Cost Eligibility" contained in Exhibit No. 203 to the Direct
Testimony of Bruce W. Griswold on behalf of Rocky Mountain Power ("RM's
Proposal") retains signficant discretion, but requires the utilties and the Commission to
find that at least thee elements or categories pertaining to single project status are met:
project location (5 miles), timing of construction (24 months), and a discretionar factor
focused on evidence of economic linkage among projects. The "Strawman Mechanism
for Determining the Size of a Qualifying Facility That is Eligible to Receive the
Published Rate" fied by Idaho Conservation League ("ICL's Proposal") is a non-
discretionar framework containing four specific critera-energy source, ownership,
location, and timing-that must be met to find that aggregation is present. ICL's .
Proposal is a refinement of the RNP-ICL Discussion Draft presented in public comments
in Case No. GNR-E-1O-04, (see Decker, Di - Page 6, Lines 15-23 though Page 7, Lines
CASE NO. GNR-R-11-0l
April 22, 2011
Decker, R (Di)3
Renewable Nortwest Project
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1 -4 and Exhibit 1901), which also formed a staring point for Staff s Proposal (Sterling,
Di - Page 6, Lines 22-25).
HOW DO YOU EVALUATE THOSE DISTINCT METHODOLOGIES?
As I stated in my Direct Testimony, a discretionar framework is more appropriate when
a neutral regulatory body is the decision maker, and less appropriate when the framework
wil be applied by an interested negotiating pary, as in the PURP A context. (Decker, Di
- Page 10, Line 20 through Page 11, Line 20.) I also, however, noted that flexibilty and
discretion can prevent techncalities from controlling decisions. (Decker, Di - Page 11,
Lines 1-2.) In other words, flexibility and discretion can prevent "gamg," and also can
prevent unusual project characterstics from eliminating a single project's eligibility for
published rates. Because I believe that comments on crafting a workable, compromise
discretionar framework wil be most helpful to the Commission, my testimony wil
focus primarly on reactions to Staffs Proposal and RMP's Proposal, which both involve
discretion and subjectivity.
To ilustrate one way in which my general comments on Staffs Proposal could be
translated into a compromise framework, I have included a red-lined version of Staffs
Proposal as Exhibit 1907 to this testimony. My red-lined version of Staffs Proposal is
similar in strctue and substance to RMP's Proposal. RMP's Proposal contains a mix of
objective and subjective criteria, in addition to the virtes of brevity and clarty. With the
refinements I suggest below, RMP's Proposal could be the best foundation for a
compromise framework.
WHAT IS YOUR PRIMARY CONCERN WITH STAFF'S PROPOSAL, AND HOW
WOULD YOU ADDRESS THAT CONCERN?
CASE NO. GNR-R-l 1-01
April 22, 201 1
Decker, R (Di)4
Renewable Nortwest Project
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My primar concern with Staffs Proposal is that, taen as literally wrtten, it would
permit projects to be combined for puroses of the eligibility theshold upon finding only
one of factors (a)-(o) was satisfied. There is no rational basis on which to find
aggregation of two projects that share, for example, only the same motive force or fuel
source, or only close proximity, or only the same operations and maintenance entity. It
may be that Staff did not intend to allow each single factor alone to result in a conclusion
that multiple projects wil be considered a single project (i.e., a "one strke, you're out"
framework). Staff may rather have intended to give the utilities and the Commission the
widest possible discretion to reach a "we know it when we see it" conclusion. Whatever
Staffs intent, it is not helpful for a written framework to state that a single one of the
factors (a)-(o) would be suffcient to conclude that multiple projects wil be aggregated
for puroses of the eligibility threshold.
It may be that the intent of Staff s Proposal was to provide the utilities and the
Commission with absolute discretion to decide when multiple projects should be
combined. In that case, I believe that Staffs Proposal allows for more subjectivity-and
offers less certainty and predictability-than is reasonably appropriate for this type of
regulatory framework. The Commission wil be delegating its policy judgment to the
utilities as the initial and, likely, most frequent arbiters of project size. With such a broad
delegation of authority comes the responsibility to. establish gudance and parameters for
the exercise of authority. Merely making review of utility decisions available, without
communcating what the Commission believes are the key overarching priciples or most
significant determinants of single/multiple project status, would leave the utilities to
guess at the Commission's unexpressed policy judgment. Moreover, the absence of any
CASE NO. GNR-R-l 1-01
April 22~ 201 1
Decker, R (Di)5
Renewable Nortwest Project
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defied parameters for applying the framework wil make it impossible for potential
project owners and financing parners to make an educated assessment of which projects
are likely to be eligible for published rates.
To address what may be either excessive restrctiveness or excessive subjectivity
in Staft s Proposal, I suggest (1) isolating at least one factor as a theshold crterion that
must be met in addition to the discretionar analysis; and (2) for the discretionar portion
of the determination, requiring a finding that at least two factors are present.
Specifically, I would make same motive force/fuel source and a defined geographic
proximity the objective threshold critera, and reform the list of discretionar factors to
ensure that a conclusion of aggregation will be based on at least two appropriate indicia
of economic linkage betwee projects. I note that these changes, ilustrated in Exhibit
1907, would make Staffs Proposal more similar in strctue to RMP's Proposal, which
contains a mix of objective criteria and subjective factors.
WHICH FACTORS IN STAFF'S PROPOSAL ARE DUPLICATIVE OR OF LIMITED
RELEVANCE IN DETERMINING ECONOMIC LINKAGE BETWEEN PROJECTS?
As I stated in my Direct Testimony, the purose of PURP A published rates is to reduce
transaction costs for projects that lack economic power and maynot anticipate revenues
suffcient to negotiate unique avoided costs and contracts with utilities. (Decker, Di ~
Page 4, Line 7 though Page 6, Line 12.) A single/multiple project framework therefore
should attempt to determine the extent to which projects are jointly developed and
economically interdependent. Several of the criteria in Staffs Proposal are duplicative or
oflimited relevance in determining economic linkage between projects.
CASE NO. GNR-R-l 1-01
April 22, 2011 Decker, R (Di)6
Renewable Nortwest Project
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1 The first is factor (h) from Staffs Proposal, which reads, "is operated and
2 maintained by the same entity." A reality of smaller proj ects is that their owners, often
3 local landowners or local governents, do not have the experse to operate and maintan
4 renewable energy projects. Another reality is that there are very few operations and
5 maintenance ("O&M") service providers wiling to serve small-scale projects. Therefore,
6 it is very likely that economically distinct projects wil be sericed by the same O&M
7 provider. Thus, while it could be relevant to ask whether multiple projects are servced
8 under the same O&M agreement, receiving O&M serce from the same entity is in no
9 way predictive of economic linkage.
10 Similarly, I would clarfy factor (j) ("uses common debt or equity financing") to
11 ensure that it applies only to interdependent financing-i.e., financing puruaIt to the
12 same or interdependent agreements or collateral packages-and not merely to using the
13 same financing entity. As with O&M providers, there are only a limited number of
14 financial parners nationally that wil work with smaller projects.
15 Another factor that I believe to be of limited relevance in determining economic
16 linkage is factor (d)-shared interconnection facilities. While shared interconnection
17 facilities is a characteristic of many aggregated projects, it is not a predictor of
18 aggregation. In other words, connection to the same substation would not indicate
19 economic linkage or interdependence; rather, it would indicate that the projects are close
20 together and that unecessar duplication of transmission infrastrctue is not good
21 public or business policy. The same would be tre, for example, of a shared access road.
22 As I said in my Direct Testimony, it may be appropriate to consider shared transmission
23 infrastrctue in the totality of the circumstances, but it would only be relevant if factors
CASE NO. GNR-R-11-0l
April 22, 2011
Decker, R (Di)7
Renewable Nortwest Project
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signficant to economic linkage between projects are also present. (Decker, Di - Page 13,
Line 19 through Page 14, Line 4.) A better solution would be to remove shared
transmission infrastrctue entirely as a determinant of aggegation, as it is essentially
duplicative of geographic proximty.
Likewise, while common tiing is an appropriate factor to consider in connection
with other factors, it is not alone a predictor of connection between projects. Therefore, a
timing factor would not be appropriate in a "one-stre" framework. If a "two-strke" or
"three-strke" framework were to be employed, I would recommend combining factors
( c) and (g), which both pertai to timing, so that a conclusion of aggregation canot be
based on timing and distance with no other evidence of connection between projects.
DO YOU HAVE ANY CONCERNS WITH THE ADMINISTRATION AND
ENFORCEMENT ELEMENTS OF THE STAFF PROPOSAL?
If the Commission declines to refie the factors and eligibility criteria in Staffs Proposal
to introduce more objectivity and predictabilty, as I have outlined above, then I do not
believe that the utility should have a decision makng role. The first, and only
determnation of compliance should come from the Commission applying its own policy
judgment. Without addition of guideposts for the analysis, I also believe that it would be
impossible for a seller to warant that its project satisfied the Single Project Requirement.
If the Commission did introduce more objectivity and predictability into the
application of the criteria, then Staffs basic administration and enforcement model could
be appropriate, with three refinements. The first is a better definition of the
administrative process. To promote certainty in the process, utilities should be required
to make determinations of single project status withn a defined time period, in wrting,
CASE NO. GNR-R-II-0l
April 22, 201 1
Decker, R (Di)8
Renewable Nortwest Project
1 and with reference to particular facts and criteria, and project proponents should be
2 required to seek Commission review within a defined perod of time.
3 The second refinement relates to confidentiality. Documentation of factors
4 pertaining to economic linkage may require disclosure of proprieta contracts and
5 financial arrangements to the utility. The Commission should make clear that
6 documentation provided to the utilities is peritted to be heavily redacted and subject to
7 a confidentiality agreement or protective order, and to provide an admnistrative process
8 for resolving disputes about sensitive information and appropriate documentation.
9 The third refinement relates to the seller waranty. When originally proposed by
10 RNPand Idaho Conservation League in public comments in GNR-E-1O-04, the concept
11 of a seller waranty was proposed as a way to promote self-policing of objective, non-
12 discretionar criteria by involving the project lender in due diligence regarding
13 disaggregation. With discretionar factors, however, it wil not be possible for a seller or
14 lender to predict how those factors wil be applied or whether the project wil be found to
15 satisfy them. Therefore, a seller waranty wil not serve the purose for which RNP
16 originally intended it.
17 With some refinements to Staffs Proposal, however, a seller waranty could help
18 to ensure the accuracy of the facts relied upon by the utility or the Commission in makng
19 the final discretionar determination and could help to prevent the seller from later
20 modifyng the project to alter the facts upon which the final determination relied. After
21 receiving a written determination of single project status, in which specific facts are
22 applied in relation to defined criteria, the seller would be able to warant that those
23 paricular facts are accurate and that they wil not change in the future. In other words, it
CASE NO. GNR-R-11-0l
April 22, 2011
Decker, R (Di)9
Renewable Nortwest Project
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would not be reasonable to ask a seller to warant that it met a set of discretionar factors,
but once those factors have been applied in a specific way, it could be reasonable to ask a
seller to confirm that the parcular application of those factors was based on accurate
facts and conclusions.
CAN YOU SUMMARIZE YOUR RESPONSES TO STAFF'S PROPOSAL?
In sumar, my primar comments in response to Staffs Proposal are (1) as literally
wrtten, it suggests a "one strke, you're out" standard; (2) even ifnot intended as a "one
strke" framework, it is too discretionar to be consistently applied by the utilities or
understood by those who must meet it (and warant that they meet it); (3) several of the
factors could captue small projects that are not linked in any economically signficant
way; and (4) the administration and enforcement provisions are vague, and should be
modified to contain timelines and to adapt the seller warranty to a discretionar
framework. These comments are incorporated into Exhibit 1907.
In the next section of my testimony, I will respond to RM's Proposal.
WHAT IS YOUR GENERAL REACTION TO RMP'S PROPOSAL?
First, RNP appreciates RMP's wilingness to engage in discussion toward developing a
framework for distinguishing single from aggregated projects, even though such a
framework may not be RMP's first choice of outcomes. Second, I continue to be
concered with the use of a discretionar framework that is to be applied by an interested
pary in the negotiation. Provision (a)(3) ofRM's Proposal is open-ended and allows
the decision maker to exercise significant subjectivity and discretion in determining
whether sufficient characteristics of a single development are found. Nonetheless, I have
focused my comments on whether a framework could chanel discretion and reduce
CASE NO. GNR-R-11-01
April 22, 2011 Decker, R(Di) 10
Renewable Nortwest Project
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subjectivity sufficiently to form a compromise solution. In that spirit, I believe that the
Commission should give serious consideration to RMP's ProposaL.
RMP's Proposal addresses several of my primar concers with Staffs Proposal
and, in its strctue and much of its substance, is similar to the red-lined version of Staff s
Proposal that I drafted to ilustrate my comments (Exhibit 1907). RMP's Proposal
contains a mix of objective and subjective crtera. Importantly, it contains threshold
criteria-motive force, distance and timing-that wil signal to utilities and potential
project owners when a discretionary analysis of the more subjective indicia of
aggregation wil be necessar. RMP's Proposal also defines the timeline and form for the
utility's initial decision. Finally, by including an ilustrative application form for
gatherig information relevant to the size determination, RM gives a very helpful
indication of how its Proposal would be applied. One fuer benefit ofRMP's Proposal
is that it is written very clearly and succinctly.
In short, although I believe that some refinements to RM's Proposal are needed,
it represents a solid foundation from which the Commission could develop a compromise
solution.
HOW WOULD YOU MODIFY RMP'S PROPOSAL?
My primar concern with RMP's Proposal is to make sure that it would not allow
shared interconnection and other factors that are not predictive of economic
interdependence from being relied upon too heavily as determinants of aggregated status.
I descrbed those factors above in my discussion of Staff s Proposal (supra Page 6, Line 4
through Page 7, Line 7). The simplest way to modify RMP's Proposal to resolve this
concer would be to add a sentence like the following to the end of (a)(3): "None ofthe
CASE NO. GNR-R-l 1-01
April 22, 201 1
Decker, R (Di) 11
Renewable Nortwest Project
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following characteristics, whether alone or in combination with one another, may be
relied upon as the sole determinant of single development status; shared interconnection
facilities; unelated arangements with the same operations and maintenance entity;
unelated arangements with the same financing provider."
RM's Proposal appear not to contemplate that projects would provide copies of
financial agreements, but rather relies upon an attestation by the project proponent that
answers to questions about those elements are accurate. See RMP Exhibit No. 203, page
3. Confidentiality concerns are mitigated by this approach, but if other forms of
documentation are requested then they should be peritted to be redacted and kept
confidential to protect proprieta information.
I recommend two additional minor modifications to RMP's Proposal. First, I
would replace "nameplate capacity" with "expected monthy average energy generation"
to correspond with Idaho's 10 aMW published rate theshold. Second, I would specify
that project generating equipment must be separated by five miles. Cf, e.g., 18 C.F.R.
§ 292.204(a)(2)(ii) (FERC rules defing one-mile separation with reference to
generating equipment). Because completely separate projects in a similar area may share
a connection to an existing substation, that connection point should not deterine their
distance from one another.
CAN YOU SUMMARIZE YOUR RESPONSE TO RMP'S PROPOSAL?
In sumary, I believe that RMP's Proposal is a good foundation for a
compromise framework because it contains a mix of objective and subjective elements,
defines timelines and content for utility decisions and review, and is succinct and clear. I
would introduce additional parameters to the discretionar portion ofRMP's Proposal, by
CASE NO. GNR-R-11-01
April 22, 2011 Decker, R (Di) 12
Renewable Nortwest Project
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directing utilities not to base their deterination with respect to criterion (a)(3) solely on
thee specific factors that are not predictive of economic linkage.
Before I conclude my testimony, I will address two other issues raised in varous
paries' direct testimony: "gaming" and the published rate theshold.
WILL USING A FIVE-MILE DISTANCE CRITERION PROMOTE "GAMING"?
Retaining a defined distance criterion like the five-mile criterion in RMP's Proposal is
ver important. If a discretionar framework is to be used, it is necessar to have some
theshold objective criteria to chanel the analysis and give some predictability to both
utilities and potential projects. At the same time, some have expressed concern that a
definite, objective proximity crterion is susceptible to gaming in that developers of
aggregated projects would be able to defeat any application of the rule by placing
generating equipment 5.1 miles apar. One way to address this concern without losing all
of the benefits of a defined, predictable distance criteron could be to allow for exceptions
to the distance criterion in special cases where projects withn 10 miles of one another
also present a greater than usual number of characteristics suggesting economic
interdependence.
HOW DO YOU RESPOND TO THE UTILITIES' CONCERN THAT THE PARTIAL
STIPULATION IN PLACE AT THE OREGON PUBLIC UTILITIES COMMISSION
(OPUC) HAS NOT PREVENTED "GAMING"?
The Parial Stipulation used by the OPUC is an agreed upon set of objective criteria for
applying the PURP A published rate threshold. (See Decker, Di - Exhibit No. 1902;
Griswold, Di - Exhibit No. 202.) No set of objective regulatory criteria will eliminate
100% of the behavior that the criteria are intended to address, but a regulation may still
CASE NO. GNR-R-I 1-01
April 22, 201 1
Decker, R (Di) 13
Renewable Nortwest Project
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captue most of that behavior. In that vein, it is worth noting that each of the utilities
points to the same 65 MW aggregated project as its example of
why the OPUC Parial
Stipulation has not prevented gamng. (Kalich, Di - Page 32, Line 12 through Page 33,
Line 2; Stokes, Di- Page 15, Lines 11-15; Griswold, Di - Page 18, Line 19 though Page
20, Line 12.) In other words, they demonstrate that one project that most would consider
to be aggregated leaked through the Parial Stipulation. It is signficant that, since
Oregon modified its rules for evaluating single/multiple project status for puroses of the
Business Energy Tax Credit in response to that same 65 MW project (Decker, Di _
Exhibit 1903), no similar anecdotes have emerged.
The Parial Stipulation is a completely different model from the frameworks put
forth by Staff and RMP in this proceeding and addressed in this testimony. The Parial
Stipulation represents an entirely objective, non-discretionar framework. This strctue
can be preferable where there is a desire to minimize involvement of agency regulators or
other paries in making subjective, discretionar determinations, but it can be more
susceptible to "gaming." With a compromise that contains both objective and subjective
elements, as offered by RMP and discussed herein, there is less opportity for
"gaming. "
IS RNP'S SUPPORT FOR A COMPROMISE FRAMEWORK PREDICATED ON
RETAINING THE 10 aM SIZE THRESHOLD?
Yes. Retaining the 10 aM published rate theshold for single projects is the reason that
RNP could support a compromise framework for preventing aggregated projects from
receiving the published rate.
CASE NO.GNR-R-l 1-01
April 22, 201 1
Decker, R (Di) 14
Renewable Nortwest Project
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At the same time, it is important to point out that permanently setting the
published rate threshold at 100 kW, as the utilities recommend, is not the only alterative
mechanism available to the Commission to address the consequences of disaggregation.
There is a vast distance between 100 kW and 10 aM, and there is no support for the
suggestion that only projects smaller than 100 kW are "truly smalL." (Cf, e.g., Kalich, Di
- Page 35, Lines 7-8.) Even ifprojects in the lower end of that range were to be
aggregated, the consequences to the utilities would be much less significant than those
with which the Commssion is now concerned.
Indeed, because the consequences of aggregation at smaller project sizes are much
more limited than they are when proJects approach the 10 aM threshold, the
Commission may wish to consider requiring only projects with a nameplate capacity
larger than three or four megawatts (or some other number) to be evaluated in the
single/multiple project framework. Applying the single/multiple project framework wil
require some administrative effort on the par of projects, utilties, and the Commission.
To reduce admstrative burden while stil achieving the Commission's goal to avoid
signficant consequences from aggegation, the Commission could establish a minimum
size larger than 100 kW for application of the single/multiple project framework.
DO YOU HAVE ANYTHING ELSE TO ADD TO YOUR TESTIMONY?
Not at ths time.
CASE NO. GNR-R-1 1-01
April 22, 2011 Decker, R (Di)15
Renewable Nortwest Project
Exhibit No. 1907
Case No. GNR-E-11-01
M. Decker, Renewable Nortwest Project
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M. Decker, Rebuttal
Exhibit 1907
Page 2 ofB
Single Project Requirement
A Single Project is eligible to receive published
avoided cost rates if it generates no more than 10 average
5 MW monthly. A Single Project that generates more thari 10
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average MW monthly and whose nameplate capacity does not
exceed 80 MW is eligible to receive avoided cost rates
calculated using the IRP Methodology.
Single Proj ect Criteria
For purposes of determining eligibility for published
avoided cost rates for projects larger than 100 kW, the
Commission will consider the following criteria in
determining whether a proj eet ,Jith multiple generation
sources that use the same motive force or fuel source and
are located in close proximity to each other qualify~ as a
Single Project. In any such determination, the Commission
19 will consider all relevant factors, including, but not
21
20 limited to, the factors listed below. Whether eaeh multiple
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generation source~ within the Proj ect:
a. uses the same motive force or fuel source;
b. ~are owned or controlled by the same person (s)
or affiliated person (s);
c.~are placed in service within 12 months of an
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M. Decker, Rebuttal
Exhibit 1907
Page 3 af8
affiliated Proj eet' seach others' commercial
operation dates~ as specified in the power sales
agreements, or have power sales agreements
executed wi thin 12 months of each other;
d.shares a common point of interconnection or
interconnection facilities;
e. shareB common control, communications, and
operation facilities;
f.shareB a common transmission interconnection
agreement;
g.has a power sales agreement executed iidthin 12
months of a similar facility in the same general
vicinity;
h. is operated and maintained by the same entity;
i.+sare constructed by the same entity wi thin 12
months;
j .uses commonobtain debt or equity financing
pursuant to a shared agreement or interdependent
ag reemen t s;
k.+sare subject to a revenue sharing arrangement;
obtainB local, state and federal land use permits
under a single application or as a single entity;
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M. Decker, Rebuttal
Exhibit 1907
Page 4 of 8
m. shares engineering and/or procurement contracts;
n.shares common land leases. T-
o.is in elose proximity to other similar facilities.
5 Eligibili ty for Published Rates
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6 ~ projeet eonsisting of m~ultiple generation sources
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that (1) use the same motive force or fuel source; (2) are
located in close proximity to each other; (3) tf
satisfy~ at least eftwo of (a) - (0) above~ and Ji.
delivers more than 10 aMW per month may be deemed by the
Commission to be aggregated a Single Project for purposes of
determining eligibility for published rates and for purposes
of calculating avoided cost rates.
Defini tions
As used above, the term "person (s)" means one or more
natural persons or legal entities. "Affiliated person (s) "
means a natural person or persons or legal entity or
entities sharing common ownership, management or acting
jointly or in concert with or exercising influence over the
policies or actions of another person or entity.
"Affiliated person(s)" does not include passive investors
whose sole ownership benefit is using production tax
credits, green tag values, or depreciation, or a combination
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M. Decker, Rebuttal
Exhibit 1907
Page 50f8
1
of these.
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Multiple generation sources are located in "close
4 proximity to each other" if any of their electrical
5 generating equipment is separated by fewer than 5 miles.
6 For hydropower projects only, multiple generation sources
7 are in "close proximity" only if they use the same
8
impoundment within a natural watercourse or are located at
the same location where the water level changes within a
non-natural watercourse (i.e., canal drop).
Proj eet Responsibilities
Administration and Enforcement
Upon request, the Projeetthe proponent of a generation
source seeking a power purchase agreement for the published
rate ("proj ect proponent") will provide to the utility any
relevant information reasonably necessary and in reasonably
sufficient detail to allow the utility to make an initial
determination of compliance with the Single Proj ect criteria
listed above. The utility shall maintain the
confidentiality of such information in the manner customary
for proceedings before the Commission.
Within thirty (30) days of receiving information from
the project proponent, the utility shall make an initial
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M. Decker, Rebuttal
Exhibit 1907
Page 6 of8
1
written determination of compliance (UInitial
Determination"). The utility's Initial Determination must
describe the criteria and documentation upon which it made
such determination. Failure to provide the Initial
Determination wi thin this time period, and failure to refer
to the criteria and documentation upon which the
determination is based, will operate as an admission by the
utility that the proj ect meets the Single Project
Requirement.
If the parties agree with the utility's Initial
Determination, then it will serve as the Final Determination
and will be incorporated into the power purchase agreement.
__Any dispute concerning a Projeet' 3 generation source's
enti tlement to published rates or the information necessary
to determine its entitlement shall be presented to the
Commission for resolution.I f a proj ect proponent disagrees
wi th the Initial Determination, then the proj ect proponent
may request Commission review no later than 30 days after
the Initial Determination is issued. The Commission wil 1
review the documentation, may request further documentation,
and will independently apply the criteria for eligibility.
Thp Commission's decision will be the Final Determination.
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M. Decker, Rebuttl .
Exhibit 1907
Page 7 of8
In each contract for payment of published rates, the
seller shall:
(i) warrant that the project satisfies the Single
Project requirement as applied in the Final
Determination;
(ii) warrant and represent that the seller will not
make any changes in its ownership, eontrol or
management during the term of the contract that
would cause it not to be in compliance with the
Single Project requirement as applied in the Final
Determination;
(iii)agree to provide buyer with documentation of
compl-iance with the Singleseparate mmership
Proj ect requirement a~ applied in the Final
Determination upon buyer's request, made no more
frequently than every 3 years, subj ect to the
buyer maintaining the confidentiality of the
documentation provided;
(iv) acknowledge that the buyer may ask the Commission
to make a new determination of compliance with the
Single Project requirement as applied in the Final
Determination; and
M. Decker, Rebuttl
Exhibit 1907
Page a afa
1
-f (v )acknowledge that, upon a Commission finding
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that the Single Project requirement as applied in
4 the Final Determination is no longer met, the
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seller will be in default under the contract.
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CERTIFICATE OF SERVICE
I hereby certify that on the jJ~y of April, 201 1, I caused to be served, via the
methodes) indicated below, tre an~rrect copies of
the foregoing Rebuttal Testimony ofMegan Decker, upon:
Jean Jewell, Secretar
Idaho Public Utilties Commission
472 West Washington Street
P.O. Box 83720
Boise, il 83720-0074
j j eweiiaapuc.state.id. us
Hand Delivered
U.S. Mail
Fax
Fed. Express
Email
Donovan Walker
Lisa Nordstrom
Idao Public Utilities Commission
472 West Washington Street
P.O. Box 83720
Boise, il 83720-0074
dwa1kertiidahopower.com
lnordstromtiidahopower.com
Hand Delivered
U.S. Mail
Fax
Fed. Express
Email
Donald L. Howell, II
Krstine A. Sasser
Deputy Attorneys General
Idaho Public Utilties Commission
472 W. Washington (83702)
POBox 83720
Boise, il 83720-0074
don.howell(fuc.idaho.gov
krs.sassef(mpuc.idaho.gov
Hand Delivered
U.S. Mail
Fax
Fed. Express
Email
Michael C. Andrea
A visita Utilities
P.O. Box 3727
1411 E. Mission Ave
Spokane, W A 99220-3727
Michael.andreatiavistacorp.com
)tw
w
t-
w
w.'-.'-~
w
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Hand Delivered .'-
U.S. Mail .'-
Fax .'-
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Hand Delivered .'-
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Danel Solander
Rocky Mountain Power
One Utah Center
201 S. Main Street, Suite 2300
Salt Lae City, UT 84111
daniel. solandertipacificorp. com
1-CERTIFICATE OF SERVICE
" .
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Lonvinger Kaufian, LLP U.S. Mail ~..
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2-CERTIFICATE OF SERVICE
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Spokane, W A 99223 Email '9dzentzCisummitpower.com
JohnR. Lowe Hand Delivered ~'-Consultant to Renewable Energy Coalition U.S. Mail ~'-
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4-CERTIFICATE OF SERVICE
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BY:~!ltkl1l1 ,
MêJVIIT & MILLER LLP--
5-CERTIFICATE OF SERVICE