20050331Comments.pdf

KIRA DALE PFISTERER
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
IDAHO BAR NO. 6571
Jrr\ c. V L
". \ , ",,-'--::;..~~",
.J.
' H, c. tJ
!$..
' 0. 1 PM 2:3i~uUiJ fH~n
; i \
; "
j i" I) (; LtC
\-'-
" ~t~ S'"' C O HHIS 51 at!,. I
Street Address for Express Mail:
472 W. WASHINGTON
BOISE, IDAHO 83702-5983
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION OF
IDAHO POWER COMPANY FOR APPROVAL
OF A FIRM ENERGY SALES AGREEMENT
FOR THE SALE AND PURCHASE OF
ELECTRIC ENERGY BETWEEN IDAHO
POWER COMPANY AND PRISTINE SPRINGS, )INC.
CASE NO. IPC-O5-
COMMENTS OF THE
COMMISSION STAFF
COMES NOW the Staff of the Idaho Public Utilities Commission, by and through its
attorney of record, Kira Dale Pfisterer, Deputy Attorney General, and in response to the Notice
of Application, Notice of Modified Procedure and Notice on Comment Deadline issued on
March 21 , 2005, submits the following comments.
BACKGROUND
On March 4, 2005, Idaho Power Company (Idaho Power or Company) filed an
Application requesting approval of a Firm Energy Sales Agreement (Agreement) between Idaho
Power and Pristine Springs, Inc. (Pristine Springs) dated February 18 , 2005. Under the
Agreement, Pristine Springs will sell and Idaho Power will purchase electric energy generated by
the Pristine Springs hydroelectric generation facility located on Warm Creek, north of Twin
STAFF COMMENTS MARCH 31 , 2005
Falls, Idaho in an area more particularly described as the NE Y4 of the NW Y4 of Section 29
Township 9 South, Range 17 East, Boise Meridian, Jerome County, Idaho. The Pristine Springs
facility consists of a single 125 kW hydroelectric generation unit. The nameplate rating and
maximum generation capability of the Pristine Springs facility is 125 kW.
The Pristine Springs facility will be a qualified small power production facility (QF)
under the applicable provisions of the Public Utility Regulatory Policies Act of 1978 (PURP A).
The Agreement was developed pursuant to Commission Order No. 29632 (Us. Geothermal
al. v. Idaho Power) and Order No. 29646 (avoided cost) to replace the existing Firm Energy
Sales Agreement between Idaho Power and Pristine Springs due to expire on March 30, 2005.
See Order No. 25793. In the Agreement, the parties agree to a ten-year contract term and to use
the Non-Levelized Published Avoided Cost Rates as currently established by the Commission for
energy deliveries of no more than 10 average MW.
Because the Pristine Springs facility is currently interconnected and selling energy to
Idaho Power under an existing Firm Energy Sales Agreement, interconnection to the Company
distribution system is completed. The previously established interconnection costs set out in the
existing Firm Energy Sales Agreement will be used to value the interconnection costs under the
proposed Agreement. The applicable monthly Schedule 72 charges will apply.
As reflected in Article 24 of the Agreement, the Agreement will not become effective
until the Commission has approved all the Agreement's terms and conditions and declares that
all payments that Idaho Power makes to Pristine Springs for purchases of energy will be allowed
as prudently incurred expenses for ratemaking purposes. The proposed effective date of the
Agreement is February 18 , 2005.
STAFF ANALYSIS
Staff has reviewed the Agreement between Idaho Power and Pristine Springs and finds
that it comports with the terms and conditions of Commission Order No. 29632 (Us.
Geothermal et al. v. Idaho Power) and avoided cost Order No. 29646. The contract is for a ten-
year term and contains the published non-Ievelized avoided cost rates set forth in Order
No. 29646.
The parties executed the contract on February 18 , 2005. However, the rates and terms
contained in the Agreement are intended to commence on March 30, 2005 (Operation Date), the
STAFF COMMENTS MARCH 31 , 2005
day following the date on which the existing contract is set to expire. Because Idaho Power did
not submit the contract for Commission approval until March 4 2005 , the Commission will be
unable to rule on the Company s Application until after the existing contract expires.
To remedy the problem of not yet having an approved new Agreement in place when the
old agreement expires, Idaho Power submitted a motion on March 30, 2005 proposing to extend
the existing agreement until such time as the new Agreement is approved by the Commission.
Idaho Power states that Pristine Springs, Inc. has concurred with this proposed solution. Staff
supports extension of the existing agreement until the new Agreement is approved, but wishes to
remind Idaho Power that in the future, the Company should submit its contracts requiring
Commission approval with sufficient time to allow the Commission to make a decision with the
opportunity for public comment.
RECOMMENDATION
Staff recommends that the Commission approve the Agreement.
Respectfully submitted this ..31~r- day of March 2005.
~!tftC
Deputy Attorney General
Technical Staff:Rick Sterling
i:umisc:comments/ipceO5.11kfrps
STAFF COMMENTS MARCH 31 , 2005
CERTIFICATE OF SERVICE
HEREBY CERTIFY THAT I HAVE THIS 31 sT DAY OF MARCH 2005
SERVED THE FOREGOING COMMENTS OF THE COMMISSION STAFF, IN
CASE NO. IPC-05-, BY MAILING A COpy THEREOF POSTAGE PREPAID, TO
THE FOLLOWING:
BARTON L KLINE
MONICA MOEN
IDAHO POWER COMPANY
PO BOX 70
BOISE ID 83707-0070
RANDY ALLPHIN
CONTRACT ADMINISTRATOR
IDAHO POWER COMPANY
PO BOX 70
BOISE ID 83707-0070
WEND ELL STARKE
PRIS TINE SPRINGS IN C
274 KAY DR
TWIN FALLS ID 83301
SECRET Y
CERTIFICATE OF SERVICE