20040817Straubhar.pdf

John J. Straubhar, P.
Water Power, LLC
P. O. Box 5071
Twin Falls, Idaho 83303-5071 iU n.J \' iC
UTILiTIES CGr'ir1t$SlGJ!N
August 15 , 2004
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Commission Secretary
Idaho Public Utility Commission
P. O. Box 83720
Boise, Idaho 83720-0074
Re:Case No. IPC E-04-, and IPC E-O4-
Dear Commissioners:
I am the president of Shorock Hydro, Inc. that owns and operates two small
hydroelectric Qualifying Facilities (QF) of2.1 Mwand 975 Kw, near Twin Falls and
Shoshone, Idaho, respectively. In addition, I am managing partner of a 1.5 Mw
hydroelectric plant on the Milner-Gooding Canal that has operated since 1994. The
Shorock plants were constructed in 1982 and 1981 respectively. I helped license, permit
design, construct, and currently operate and manage these plants. I have also worked on
numerous other plants as a consulting engineer and project manager, and feel I
understand the business.
I am the president of Water Power, LLC. We recently worked with the American
Falls Reservoir District, Twin Falls Canal Company, North Side Canal Company, and
Boise Project Board of Control trying to develop (13) small hydroelectric qualifying
facilities, all on seasonal canals that operate typically from April through October. These
plants represent some 15 Mw of capacity and 66 287 Mw hrs of production, all of which
could be on line in 3 - 5 years.
At this time, the primary hindrance to the development of these potential power
plants is the 90 percentile of the stipulated contract amount and revision of the
seasonality months. The above facilities were available for development in 1995 when
the Commission stopped QF development by the implementation of Order No. 25884 and
No. 26576. In order to reinstate the PURPA Laws as intended, we need to leave the
contract as it was written in 1995 regarding production, energy only, and with the same
seasons for payment. A four month high season comprised of the months of June, July,
August, and September is very important to the development of seasonal irrigation
projects. These seasons also match IPC's high demand in the summer months.
The aforementioned plants could operate very effectively at an avoided cost rate of$.
seasonalized by the 1.2 factor currently being used. What the QF industry needs is the
following:
Long term, fixed rate, contracts for proj ects up to ten megawatts.
Avoided cost rates determined over the term of the contract and equal to the life
of Idaho Power s new resources.
Standardized contract terms.
Standardized interconnection terms and conditions.
Avoided cost rates determined using Idaho Power s actual new plan additions for
avoided cost rate calculations.
A four month high season comprised of June, Jilly, August, and September.
The contracts should be for energy only, where you get paid for what you
produce, with no 90% penalty.
It appears to me that deregulation will not happen and the regulated utilities fear
of stranded costs due to QF facilities is unfounded.
QF facilities on seasonal canals are very environmentally benign and would
greatly benefit the canal companies allowing them to better maintain and enhance their
systems. An example of this is the Twin Falls Canal Company who owns QF facilities or
receives income from existing QF', they have made some excellent improvements to the
irrigation systems and their stockholders have benefited greatly.
QF facilities are good for the local ratepayer as they can provide local economic
stability with a fixed rate over a 20 year period.
The QF industry is very reliable and competitive contrary to rumor and innuendo.
Our existing plants typically run the entire irrigation season at an exceptionally high plant
factor. The canal companies demand that the plants be run very efficiently with no impact
on their system.
The QF industry is very positive for Idaho and power consumers. We need a
level playing field and the IPUC is in a position to help us achieve this goal while also
benefiting all of Idaho.
If I can be of further service or if you wish to discuss my comments I can be
reached at 208-736-8255.
Sincerely,