modproc.app.doc

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

in the matter of THE APPLICATION OF IDAHO POWER COMPANY FOR AN ORDER ACKNOWLEDGING THE TERMINATION OF DELIVERIES OF POWER FROM EMMETT POWER COMPANY AND FOR AN ACCOUNTING ORDER AUTHORIZING IDAHO POWER TO INCLUDE LIQUIDATED DAMAGES PAYMENTS RECEIVED FROM EMMETT POWER COMPANY IN THE POWER COST ADJUSTMENT RATE. )
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CASE NO. IPC-E-01-15

NOTICE OF APPLICATION

NOTICE OF MODIFIED PROCEDURE

NOTICE OF COMMENT/PROTEST DEADLINE

YOU ARE HEREBY NOTIFIED that on May 4, 2001, Idaho Power Company (Idaho Power; Company) filed an Application in Case No. IPC-E-01-15 for an Order acknowledging the termination of delivery of power from Emmett Power Company and for an accounting order authorizing Idaho Power to include liquidated damage payments in the true-up portion of the Company’s Power Cost Adjustment.
As reflected in the Company’s Application, Idaho Power notes that Boise Cascade Corporation recently announced the imminent closure of its southern Idaho wood products operations which provide the wood waste fuel for Emmett Power’s operation and its steam host at Emmett, Idaho. Emmett Power has in turn notified Idaho Power that it will be forced to terminate its energy deliveries under its January 12, 1984, Firm Energy Sales Agreement (Agreement) with Idaho Power as a result of its loss of its waste wood fuel supplies and steam host. Emmett Power has advised the Company that it will permanently and fully curtail its deliveries of annual net energy at 11:59 p.m. on May 31, 2001. In accordance with Section 21.2.2 of the Agreement, such a permanent curtailment will result in Emmett Power being obligated to pay Idaho Power (in immediately available funds) the sum of $4,037,600 as liquidated damages.
Idaho Power states that it has undertaken a number of discussions with Emmett Power to see if there are any steps that could be taken to allow Emmett Power to continue to deliver annual net energy under the same prices, terms and conditions provided in the Agreement. Those discussions, the Company states, have not been successful. Emmett Power has advised the Company that without the wood waste from the soon to be closed Boise Cascade facilities, it is not economically feasible for Emmett Power to continue to deliver annual net energy at the prices contained in the Agreement.
The underlying Agreement provides for Emmett Power Company to deliver annual net energy (approx. 12 MW) for a term of 20 years commencing in 1985. Emmett Power’s notification to Idaho Power that it will permanently and fully curtail its deliveries of annual net energies on May 31, 2001, constitutes a breach of the Agreement and obligates Emmett Power Company to pay Idaho Power damages. Section 21.2.2 of the Agreement provides for liquidated damages and establishes the amount of damages Emmett Power is obligated to pay the Company as the sole remedy for Emmett Power’s breach of the Agreement. Idaho Power has reviewed the Agreement and has established that under the Agreement, the liquidated damage amount is $4,037,600.
The proposed accounting for the $4,037,600 liquidated damage amount is as follows:
131 Cash
699 X00001 999 131000

401 Operation Expense
699 M30108 511 555100

Idaho Power requests approval of the proposed accounting treatment so that revenues received in 2001 associated with the payment of liquidated damages can be included as an offset to QF expense in the true-up portion of the Company’s May 2002 Power Cost Adjustment recovery. The offset, the Company contends, will benefit customers by reducing QF expense in the May 2002 PCA filing.
Idaho Power requests that the Commission issue an Order (1) acknowledging the termination of deliveries of energy by Emmett Power and (2) approving Idaho Power’s requested accounting treatment. If the Commission determines that the matter requires notice, the Company requests that the matter be processed under Modified Procedure, i.e., by written submission rather than by hearing. Reference Commission Rules of Procedure, IDAPA 31.01.01.201-204.
YOU ARE FURTHER NOTIFIED that the Commission has reviewed the Company’s Application in Case No. IPC-E-01-15. The Commission has preliminarily found that the public interest regarding the Application may not require a hearing to consider the issues presented and that the Application may be processed under Modified Procedure, i.e., by written submission rather than by hearing. Reference Commission Rules of Procedure, IDAPA 31.01.01.201-204.
YOU ARE FURTHER NOTIFIED that the Commission will not hold a hearing in this proceeding unless it receives written protests or comments opposing the use of Modified Procedure and stating why Modified Procedure should not be used. Reference IDAPA 31.01.01.203.
YOU ARE FURTHER NOTIFIED that the deadline for filing written comments or protests with respect to the Application and the Commission’s use of Modified Procedure in Case No. IPC-E-01-15 is Wednesday, June 13, 2001. Persons desiring a hearing must specifically request a hearing in their written protests or comments.
YOU ARE FURTHER NOTIFIED that if no written comments or protests are received within the deadline, the Commission will consider the matter on its merits and enter its Order without a formal hearing. If comments or protests are filed within the deadline, the Commission will consider them and in its discretion may set the matter for hearing or may decide the matter and issue its Order on the basis of the written positions before it. Reference IDAPA 31.01.01.204.
YOU ARE FURTHER NOTIFIED that the Application in Case No. IPC-E-01-15 has been filed with the Commission and is available for public inspection during regular business hours at the Commission Office and at the principal office of Idaho Power Company, 1221 West Idaho Street, Boise, Idaho. Written comments concerning this Application should be mailed to the Commission and the Company at the addresses reflected below.

COMMISSION SECRETARY
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074

Street Address for Express Mail:

472 W WASHINGTON ST
BOISE, ID 83702-5983 BARTON L KLINE
LARRY D. RIPLEY
SENIOR ATTORNEYS
IDAHO POWER COMPANY
PO BOX 70
BOISE ID 83707-0070
And
GREG SAID
IDAHO POWER COMPANY
PO BOX 70
BOISE ID 83707-0070

Street Address for Express Mail:

1221 W IDAHO STREET
BOISE, IDAHO 83702
All comments should contain the case caption and case number shown on the first page of this document.

DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this _______ day of September 2001.

PAUL KJELLANDER, PRESIDENT

MARSHA H. SMITH, COMMISSIONER

DENNIS S. HANSEN, COMMISSIONER

ATTEST:

Jean D. Jewell
Commission Secretary

vld/N:IPC-E-01-15_sw

NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
NOTICE OF COMMENT/PROTEST DEADLINE 1

Office of the Secretary
Service Date
May 23, 2001