The URL can be used to link to this page

Home My WebLink About20020125Reply Comments.pdf- )3? Sffi*,roro,o*u,ffifiStlVID P0.80x70 i:li-F'-I 80tsE. tDAllo 83707 r*-tIE BARTON L. KLINE Senior Attorney An IDACORP Company Ztil? -liill 25 PPI tr: 2? .,iii.l{Neiryi*Qifoca Ms. Jean D. Jewell, Secretary Idaho Public Utilities Commission 472W . Washington Street P.O. Box 83720 Boise, ldaho 83720-0074 Re: Case No. IPC-E-O1-40 Reply Comments of ldaho Power Company Dear Ms. Jewell: Enclosed herewith for filing with the Commission are an original and seven (7) copies of the Reply Comments of ldaho Power Company regarding the above-entitled case. I would appreciate it if you would return a stamped copy of this transmittal letter for our files. Ve ly yours, Barton L. Kline BLK:jb Enclosures Telephone (208) 388-2682, FAX (208) 388-6936, E-Mail bkline@idahopower.com t BARTON L. KLINE ISB #1526 ldaho Power Company P. O. Box 70 Boise, ldaho 83707 Telephone: (208) 388-2682 FAX Telephone: (208) 388-6936 Attorney for ldaho Power Company Street Address for Express Mail: 1221 West ldaho Street Boise, ldaho 83702 IN THE MATTER OF THE APPLICATION OF IDAHO POWER COMPANY TO AMEND SCHEDULE 86 -- COGENERATION AND SMALL POWER PRODUCTION .- NON-FIRM ENERGY. crtr:l\lFnr,i;vLr v Ls 1.:il rr! 28[2 Ji]i 25 P]l t+: 27 r-"1 r.J I lrl i I ' '",r lcr,, ,..r ;'*ijLil,r! rrrl^la!l:5 UUnfll))lUtI BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION ) ) ) ) ) ) CASE NO. IPC-E-o1-40 REPLY COMMENTS OF IDAHO POWER COMPANY All of the commenters addressing ldaho Power's proposed revised Schedule 86 urge the Commission to make Schedule 86 applicable to any QF project, regardless of size. ldaho Power had originally proposed that Schedule 86 be limited to non-firm projects smaller than 1 MW. In order to understand why ldaho Power believes that limiting Schedule 86 to smaller projects is desirable, a brief history of Schedule 86 may be useful. HISTORY OF SCHEDULE 86 Except for the proposed size-based limit on eligibility, the proposed Schedule 86 is substantially unchanged from the current Schedule 86. Because it is a tariff, Schedule 86 establishes a standard non-firm energy purchase arrangement :( REPLY COMMENTS OF IDAHO POWER COMPANY, Page 1 containing the various terms and conditions for sales of non-firm energy by PURPA qualifying facilities to ldaho Power Company. Under Schedule 86, an energy producer has no commitment to make energy deliveries, no financial penalties for contract termination, a specified methodology to compute the energy purchase price, and very few operational constraints. Schedule 86 provides a relatively simple contracting process intended to allow small, unsophisticated energy producers to contract to sell non-firm energy to ldaho Power easily and inexpensively. So long as transactions are limited to smaller projects, the tariff format, including the standard contract, works very well. However, ldaho Power's experience has demonstrated that for larger projects, 1 MW and greater, the minimalist tariff process is less than idea!. Larger projects invariably present more complicated operating issues, interconnection issues, and pricing issues. The Commission has previously recognized this reality in all of the other QF purchase price determinations it has undertaken. The 1 MW threshold has traditionally been the break between the standardized posted rates and the rates for larger projects that are subject to negotiation between ldaho Power and the proposed seller. Staff's comments oppose the Company's proposal to limit Schedule 86 to projects smaller than 1 MW. The basis for Staff's opposition is that there is no other tariff or Commission-ordered pricing mechanism in place to accommodate non-firm energy sales from facilities 1 MW and larger. As an alternative, Staff suggests that Idaho Power add provisions to Schedule 86 permitting the Company to negotiate non- firm energy rates on a case-by-case basis for projects 1 MW and larger. Staff goes on to suggest that negotiations for such larger projects would be the Schedule 86 rates REPLY COMMENTS OF IDAHO POWER COMPANY, Page 2 with discounts or bonuses to this price based on individual characteristics of each larger project. Frankly, this is exactly what ldaho Power assumed would be the case if the Commission approved Schedule 86 as proposed by ldaho Power. The Company anticipated that projects larger than 1 MW that desired to sel! energy to ldaho Power on a non-firm basis would do so based on individual negotiations. ldaho Power would suggest that any discussion concerning the obligation to negotiate with larger projects be contained in the order issued by the Commission rather than in the tariff which will explicitly apply to projects smaller than 1 MW. Placing language in the order notifying potential non-firm energy sellers with projects larger than 1 MW that they can negotiate rates, terms and conditions with ldaho Power would be sufficient. ldaho Power agrees with Staff that the starting point for negotiations for contracts to purchase non-firm energy from projects 1 MW and larger should be the Schedule 86 rate calculation methodology. ldaho Power is willing to negotiate in good faith with larger QF projects to determine an equitable purchase price using the Schedule 86 methodology as the starting point. DATED at Boise, ldaho, this 25th day of January, 2002. BAR N L. KLINE Attorney for ldaho Power Company REPLY COMMENTS OF IDAHO POWER COMPANY, Page 3 CERTIFICATE OF SERVICE I HEREBY CERTIFY that on the 25th day of January, 2002,1 served a true and correct copy of the within and foregoing REPLY COMMENTS OF IDAHO POWER COMPANY upon the following named parties/commenters by the method indicated below, and addressed to the following: Scott Woodbury Deputy Attorney General ldaho Public Utilities Commission 472 W . Washington Street P.O. Box 83720 Boise, ldaho 83720-0074 Robert W. Hoppie Administrator, Energy Division ldaho Department of Water Resources P.O. Box 83720 Boise, ldaho 83720-0098 Frank Priestley, President ldaho Farm Bureau Federation P.O. Box 167 Boise, ldaho 83701-0167 Bill Chisholm Energy Coordinator ldaho RuralCouncil P.O. Box 1 18 Bliss, ldaho 83314 William M. Eddie Land and Water Fund of the Rockies P.O. Box 1612 Boise, ldaho 83701 x x x x x Hand Delivered U.S. Mail Overnight Mai! FAX Hand Delivered U.S. Mail Overnight Mail FAX Hand Delivered U.S. Mail Overnight Mail FAX Hand Delivered U.S. Mail Overnight Mail FAX Hand Delivered U.S. Mail Overnight Mail FAX CERTIFICATE OF SERVICE BARTON L. KLINE