20041122Application.pdf

:E-CEIVED L~J
BARTON L. KLINE, ISB # 1526
MONICA MOEN , ISB # 5734
Idaho Power Company
1221 West Idaho Street
O. Box 70
Boise, Idaho 83707
Telephone: [phone]
FAX Telephone: [phone]
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UTiLiTIES CCI':r'i!SSION
Attorneys for Idaho Power Company
BEFORE THE IDAHO PUBLIC UTiliTIES COMMISSION
IN THE MATTER OF THE APPLICATION OF
IDAHO POWER COMPANY FOR AN ORDER
APPROVING TERMINATION OF
DELIVERIES OF ENERGY FROM THE
WEST BOISE WASTE PROJECT AND
THE ASSOCIATED FIRM ENERGY SALES
AGREEMENT BETWEEN IDAHO POWERAND THE CITY OF BOISE
CASE NO. IPC-04-
APPLICATION
COMES NOW Idaho Power Company ("Idaho Power" or the "Company
and , pursuant to Rule of Procedure 52, hereby requests that the Idaho Public Utilities
Commission ("IPUC" or the "Commission ) issue an Order approving termination of
deliveries of energy from the City of Boise s West Boise Waste Cogeneration Project
Project") and termination of the associated non-Ievelized Firm Energy Sales
Agreement dated November 8, 1991 ("Agreement") which is scheduled to expire in
November 2006.
This Application is based on the following:
APPLICATION, Page
In correspondence dated October 25, 2004, attached hereto as Exhibit 1
the City of Boise (the "City ) requests termination of the Firm Energy Sales Agreement
dated November 8, 1991 between the City and Idaho Power. Termination would be
effective as of Octobe r 25 , 2004.As noted by the City, the Project has been
experiencing significant problems with the generation equipment associated with the
Project due to the inherent corrosive nature of the digester methane gas that fuels the
equipment. Over the past twelve years , the equipment has been routinely rebuilt and
repaired in an effort to prolong the life of the Project. At this time, however, the
equipment is beyond repair. While the City intends to install gas-conditioning devices
and new generation equipment in the future, the gas-conditioning equipment will not be
available and in place before expiration of the term of the existing Agreement
November 2006.
II.
Idaho Power has reviewed the Agreement between the Company and the
City that was approved by the Commission in Order No. 23986. Article VII of the
Agreement specifies that non-Ievelized energy payments are to be made to the Project
for the term of the Agreement for the energy delivered to Idaho Power. Because the
energy payments are non-Ievelized , no overpayments to the City from Idaho Power
have accumulated.Thus, no overpayments from the Project are due should the
Commission approve early termination of the Agreement.Furthermore, no other
specific liquidated damages or early termination penalties are specified in the
Agreement.
APPLICATION , Page 2
III.
For the remaining term of the Agreement, the non-Ievelized energy rates
set out in the Agreement range from approximately 49 Mills/kWh to 81 Mills/kWh for an
average of 68.20 Mills/kWh. On October 28, 2004 , the forecasted Mid C Market values
for the same timeframe ranged between 30 Mills/kWh and 68 Mills/kWh for an average
of 57.90 Mills/kWh. The cumulative difference between the Agreement's actual energy
payment and the equivalent forecasted Mid C Market energy purchases over the same
time period results in the Agreement's energy payments being approximately $35 000
greater than similar energy purchases based upon the forecasted Mid C Market energy
prices.
IV.
Should the Commission approve this Application, Idaho Power would
remove the interconnection equipment at this Project as requested by the City and
accordance with terms of the Agreement.
Service of pleadings, exhibits, orders and other documents relating to this
proceeding should be served on the following.
Barton L. Kline , Senior Attorney
Monica Moen, Attorney
Idaho Power Company
O. Box 70
Boise , Idaho 83707 -0070
bkline (Q) idahopower.com
mmoen (Q) idahopower.com
Randy C. Allphin
Contract Administrator
Idaho Power Company
O. Box 70
Boise, Idaho 83707-0070
ml!Phin (Q) idahopower.com
NOW , THEREFORE , based on the foregoing, Idaho Power hereby
requests that, pursuant to IPUC Rule of Procedure 201 , the Commission process this
APPLICATION , Page 3
case on modified procedure and issue its Order approving the termination of the Firm
Energy Sales Agreement for the West Boise Waste Project between Idaho Power and
the City of Boise.
Respectfully submitted this t9.~/N:L day of November 2004.
(b.
MONICA B. MOEN
Attorney for Idaho Power Company
APPLICATION , Page 4
CERTIFICATE OF MAILING
I HEREBY CERTIFY that on this ay of November 2004, I mailed a
copy of the above and foregoing APPLICATION to the following-named individual by
first-class U.S. mail at the address set out below:
City of Boise
Attn: William F Johnson
P. O. Box 500
Boise , ID 83701-0500
(J;,
MONICA B. MOEN
Attorney for Idaho Power Company
CERTIFICATE OF MAILING
EXHIBIT
PUBLIC WORKS DEPARTMENT
CITY HALL
DAVID H, BIETER
MAYOR
COUNCIL MEMBERS
8 0 I SCITY OF TREES
M. JEROME MAPP
COUNCIL PRESIDENT
VERNON L BISTERFELDT
ELAINE CLEGG
DAVID EBERLE
AL/\N IN- SHEALY
MARY.A.NNE JORDAN
COUNCIL PRO-TEM
October 25 2004
Randy Allphin
Contract Administrator
Idaho Power Company
O. Box 70
Boise, ill 83707
!\i1!
RE:West Boise WWTF Cogeneration Contract (!PCO Project #41455091)
Request for Contract Termination
Dear Mr. Allphin:
This letter is to advise Idaho Power Company (!Pca) that after thirteen years ofbuming raw digester
methane gas as a fuel supply, the City of Boise s West Boise WWTF generating facilities have
become badly worn and are no longer capable of producing power. The City has determined it is
impractical to repair, replace, or upgrade this generating equipment until gas conditioning equipment
can be installed to remove impurities from the digester methane gas supply. Gas conditioning
provisions win not be available for at least two years, at which time the current sales agreement will
have expired. Therefore, the City of Boise is requesting immediate termination of the current Firm
Energy Sales Agreement entered into November 25 1991.
"'"
Since there is no foreseeable further need for !pca to maintain its existing associated switching and
transformer equipment on site, the City of Boise is requesting this equipment be decommissioned and
preferably removed. We understand there will be no need by !PCO to assess further maintenance or
repair charges associated with this equipment.
The City is expressing its appreciation for the cooperation of IPCO in closing this current contract.
We remain very interested in considering future cogeneration partnering opportunities with !PCO for
the beneficial use of conditioned digester methane gas produced at our treah11ent facilities. If youhave questions or win require further information, please contact Bin Johnson at 388-4767.
Sincerely,
Ir/
Iff
~i!!? ..5
William F. Johnson, P.
Environmental Engineer
cc:Mr. Charles R. Mickelson, Public Works Director, City of Boise Public Works
Mr. John Tensen, City Engineer, City of Boise Public Works
Mr. Richard Dees, Operation Manager, City of Boise Public Works
WFJ/ab
H:\msoffi ce\ W ord\IPCOCogenClose.doc
CITY H!\LL. 150 NORTH CA,PITOL BOULE\,/\RD. P-O. BOX 500. BOISE, lD/\HO 83701-0500. 208/384-3900
FAX [phone]. An Equal Opporrllniry EmploJ/CT. www.ciryofboise.org
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