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Home My WebLink About20040722Notice of Application.pdfOffice of the Secretary Service Date BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION July 22, 2004 IN THE MATTER OF THE APPLICATION OF IDAHO POWER COMPANY FOR APPROVAL OF AN AGREEMENT FOR THE SALE AND PURCHASE OF ELECTRIC ENERGY BETWEEN IDAHO POWER COMPANY AND THE J.R. SIMPLOT COMPANY. CASE NO. IPC-O4- NOTICE OF APPLICATION NOTICE OF MODIFIED PROCEDURE NOTICE OF COMMENT/ PROTEST DEADLINE YOU ARE HEREBY NOTIFIED that on June 25, 2004, Idaho Power Company (Idaho Power; Company) filed an Application with the Idaho Public Utilities Commission (Commission) requesting approval of a Firm Energy Sales Agreement between Idaho Power and R. Simplot Company (Simplot) dated June 18 2004 (Agreement). Simplot currently owns, operates and maintains a 15.9 MW cogeneration facility (project) at its industrial site near Pocatello, Idaho. The project is a qualified cogeneration facility under the applicable provisions of the Public Utility Regulatory Policies Act of 1978 (PURPA). As reflected in the Company s Application, the Simplot project is currently interconnected to Idaho Power and is selling energy to Idaho Power as a Qualifying Facility (QF) in accordance with a Firm Energy Sales Agreement dated January 24 1991 (Order No. 23552) and as subsequently amended on November 30, 1993 (Order No. 25353) and February 23 , 2001 (Order No. 28730), and by two letter Agreements signed by the parties that extended the term of the 1991 Agreement to February 29 2004. On March 5 2004, Idaho Power filed an Application with the Commission requesting approval of a Firm Energy Sales Agreement between Idaho Power and Simplot dated February 19 2004. Reference Case No. IPC-04-7. Subsequent to initial Notice of Application and Modified Procedure, and following the filing of Staff and Reply Comments, Idaho Power NOTICE OF APPLICATION NOTICE OF MODIFIED PROCEDURE NOTICE OF COMMENT/ PROTEST DEADLINE 1 requested that its Application be withdrawn. Reference Commission Order No. 29503, May 27 2004. Under the terms of the newly submitted Agreement, Simplot has elected to contract with Idaho Power for a one-year term. The Agreement contains non-Ievelized published avoided cost rates established by the Commission for energy deliveries less than 10 MW (Order No. 29391) for a contract year March 1 , 2004 through February 28, 2005. The Agreement will evergreen" or automatically renew from year-to-year unless terminated. Agreement ' 5.3. Idaho Power will pay the published, less than 10 MW non-Ievelized non-fueled energy price in accordance with the Commission Order in effect as of March 1 st of each contract year. The submitted Agreement, the Company states, is similar in many respects to recent QF contracts between Idaho Power and Tiber Montana LLC (IPC-03-1), and United Materials of Great Falls, Inc. (IPC- E-04-1). The Company in this Agreement defines energy delivered to Idaho Power exceeding 000 kW in a single hour as "Inadvertent Energy.Agreement' 1.9. As reflected in the Agreement Simplot does not intend to generate and deliver Inadvertent Energy. If Simplot accidentally generates and delivers Inadvertent Energy, Idaho Power will not purchase or pay for Inadvertent Energy. As an incentive for Simplot to deliver energy to the Company during times when it is of greater value to Idaho Power, the Company has refined the seasonalization of rates to coincide to the months in which Idaho Power has identified actual energy needs and periods of higher demands. Reference Agreement ~ 6.2. As reflected in Agreement ~ 8.1 , Idaho Power states that it waives any claim to ownership of Environmental Attributes. Environmental Attributes include, but are not limited to green tags, green certificates, renewable energy credits (RECs) and tradable renewable certificates (TRCs) directly associated with the production of energy from the Simplot project. Noting the Commission s language regarding Environmental Attributes in Case No. IPC-04- Order No. 29480, Idaho Power states that it is willing to waive any legal rights to the Environmental Attributes, if the Commission is willing to provide the Company with reasonable assurance that the Company will not be penalized in a future revenue requirement proceeding for having agreed to forego any ownership interest or right in the Environmental Attributes. NOTICE OF APPLICATION NOTICE OF MODIFIED PROCEDURE NOTICE OF COMMENT/ PROTEST DEADLINE filing this Agreement, including the language in Article 8, Idaho Power states that it is presenting the Commission with a real case or controversy and, therefore, the lack of ripeness identified by the Commission in the declaratory judgment action is not present in this case. Agreement ~ 24 provides that the Agreement will not become effective until the Commission has approved without change all the Agreement terms and conditions and declared that all payments to Simplot that Idaho Power makes for purchases of energy will be allowed as prudently incurred expenses for ratemaking purposes. Should the Commission approve the Agreement, Idaho Power intends to consider the effective date of the Simplot Agreement to be March 1 2004. Idaho Power further requests a Commission finding that all payments for purchases of energy under the January and February 2004 extensions of the 1991 Agreement will be allowed as prudently incurred expenses for ratemaking purposes. The rate paid for energy during the months of January and February 2004 was the same rate specified in the 1991 Agreement for December 2003 (0.04201~ per kWh) and is less than the then and current published avoided cost rates for those same months. YOU ARE FURTHER NOTIFIED that the Commission has reviewed the filings of record in Case No. IPC-04-16. The Commission has preliminarily found that the public interest in this matter may not require a hearing to consider the issues presented and that issues raised by the Company s filing may be processed under Modified Procedure, i., by written submission rather than by hearing. Reference Commission Rules of Procedure IDAP A 31.01.01.201-204. 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-04-16 is Friday, August 13, 2004.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 may consider the issue 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 NOTICE OF APPLICATION NOTICE OF MODIFIED PROCEDURE NOTICE OF COMMENT/ PROTEST DEADLINE decide the matter and issue its Order based on the written positions before it. Reference IDAP A 31.01.01.204. YOU ARE FURTHER NOTIFIED that written comments concerning Case No. IPC-04-16 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: MONICA MOEN, ATTORNEY II BARTON L KLINE, SR. ATTORNEY IDAHO POWER COMPANY PO BOX 70 BOISE ID 83707-0070 e-mail: bkline(fY,idahopower.com e-mail: mmoen~idahopower.com 472 W WASHINGTON ST BOISE, ID 83702-5983 RANDY C.ALLPHIN CONTRACT ADMINISTRATOR IDAHO POWER COMPANY PO BOX 70 BOISE ID 83707-0070 e-mail: rallphin~idahopower.com Street Address for Express Mail: 1221 West Idaho Street Boise, Idaho 83702 All comments should contain the case caption and case number shown on the first page of this document. Persons desiring to submit comments via e-mail may do so by accessing the Commission s home page located at www.puc.state.id.. Click the "Comments and Questions icon, and complete the comment form, using the case number as it appears. YOU ARE FURTHER NOTIFIED that if no written comments or protests are received within the time limit set, the Commission will consider this matter on its merits and enter its Order without a formal hearing. If written comments are received within the time limit set, the Commission will consider them and, in its discretion, may set the same for formal hearing. YOU ARE FURTHER NOTIFIED that the Application in Case No. IPC-04- may be viewed at www.puc.state.id.by clicking on "File Room" and "Electric Cases " or can be viewed during regular business hours at the Idaho Public Utilities Commission, 472 West NOTICE OF APPLICATION NOTICE OF MODIFIED PROCEDURE NOTICE OF COMMENT/ PROTEST DEADLINE Washington Street, Boise, Idaho and at the general business office of Idaho Power Company, 1221 West Idaho Street, Boise, Idaho. DA TED at Boise, Idaho this ,;L:l day of July 2004. Je . Jewell Co ission Secretary VldIN:IPCEO416 sw NOTICE OF APPLICATION NOTICE OF MODIFIED PROCEDURE NOTICE OF COMMENT/ PROTEST DEADLINE