20040331Comment.pdf

Jean Jewell
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Sent:
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Ed Howell
Tuesday, March 30, 2004 6:41 AM
Jean Jewell; Ed Howell; Gene Fadness; Tanya Clark
Comment acknowledgement
WWW Form Submission:
Tuesday, March 30, 2004
6:40:46 AM
Case: IPC-E-04-
Name: Gerry FleischmanStreetAddress: 5437 Hickory Run Pl
City: Boise
State: Idaho
ZIP: 83713
Home Telephone: [phone]E-Mail: gfleisch98 60hotmail. com
Company: Idaho Power Company
mailing list yes no: no
Comment = descriptIon:I f you are to follow the intent of PURPA, namely, to encourage
renewable energy production and fuel-efficient cogeneration,
then it would make sense that payments for power generation
capaci ties and quanti ties above the published rate limit, should
also reflect avoided cost and not market rates.
The reason this is important is that, especially in the case of
renewable energy proj ects, capital is greatest cost, and capital
requires financing. All projects, especially wind power, have
economies of scale. By implying that power generated above the
published rate ceiling (currently 10 MW) should be based on the
market and not avioided cost inserts a huge variability in cashflows to potential proj ects, which discourages economies of
scale, and will kill them.
The contract for this proj ect should not stand as a precedent for
future PURPA contracts. You should indicate in your decision to
approve this contract that while it is OK for Idaho Power and
Simplot to negotiate a contract for the above portion of
generation above 10 MW in most any way they want, that it is the
intent of PURPA and your implementation of PURPA, that
contracts for project above 10 MW and less than 80 MW (the
Federal PURPA upper limit) have negotiated rates based onavoided cost and not market rates.
The Simplot phosphate plant cogeneration system uses fully
amortized equipment. From this standpoint it has little
resemblance to the great maj ori ty of potential new PURPA
projects in Idaho. If your intent is to encourage renewable energy
power generation, you should make it clear that this contract
does not restrict the ability of other PURPA proj ects to negotiate
rates for generation above the published rate limit based onavoided costs not on market rates.
Transaction 10: 330640.Referred by: http: / /www. puc. state. id. us/ scripts/polyform. dll/ ipuc
User Address: 216.222.109.
User Hostname: 216.222.109.