20050908final order no 29863.pdf

Office of the Secretary
Service Date
September 8, 2005
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 TWIN FALLS ENERGY COMPANY
INC.
CASE NO. IPC-O5-
ORDER NO. 29863
On July 6, 2005 , Idaho Power Company (Idaho Power; Company) filed an
Application with the Idaho Public Utilities Commission (Commission) requesting approval of a
20-year Firm Energy Sales Agreement (Agreement) between Idaho Power and Twin Falls
Energy Company, Inc. (Twin Falls) dated June 27 2005. Under the Agreement, Twin Falls will
sell and Idaho Power will purchase electric energy generated by the Low Line Midway
Hydroelectric Project, located approximately one mile downstream from the point of the Low
Line Canal origin, in an area more particularly described as the NW 1/4, of the NW 1/4 of
Section 11 Township 11 S Range 10 E, Boise Meridian, Twin Falls County, Idaho. The
nameplate rating of the hydro project is 2.5 MW.
The Twin Falls Project will be a qualified small power production facility (QF) under
the applicable provisions of the Public Utility Regulatory Policies Act of 1978 (PURP A). Twin
Falls has selected March 10, 2007 as the first energy date and April 1 , 2007 as the scheduled
operation date.
As represented by Idaho Power, the Agreement with Twin Falls comports with the
terms and conditions of Commission Order No. 29632 (Us. Geothermal et al v. Idaho Power)
and avoided cost Order No. 29646. Twin Falls has elected to receive the levelized published
avoided cost rates set forth in Order No. 29646. The Company represents that the Agreement
contains the various security requirements required by the Commission for levelized agreements.
As reflected in Section 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 Twin Falls for purchases of energy will be
ORDER NO. 29863
allowed as prudently incurred expenses for ratemaking purposes. The proposed effective date of
the Agreement is June 27 2005.
On August 3 , 2005, the Commission issued Notices of Application and Modified
Procedure in Case No. IPC-05-23. The deadline for filing written comments was August 26
2005. The Commission Staff was the only 'party to file comments. Based on its review, Staff
recommends that the Agreement be approved with an effective date of June 27 2005. Staffs
review confirms that the Agreement contains the various security requirements required by the
Commission for levelized agreements. Staff also confirms that the Agreement comports with the
terms and conditions of the Commission s Order No. 29632 (Us. Geothermal et at. v. Idaho
Power) and avoided cost Order No. 29646.
Commission Findings
The Commission has reviewed the filings of record in Case No. IPC-05-
including the underlying Agreement and filed comments. Idaho Power has presented a Firm
- Energy Sales Agreement with Twin Falls Energy Company, Inc. for Commission consideration
and approval. The Agreement is for a 2.5 MW hydro project located in the Twin Falls area. We
find that the project is qualified to receive published avoided cost rates approved by the
Commission.
The Commission finds that the Agreement submitted in this case contains acceptable
contract provisions and includes the levelized published rates approved by the Commission
Order No. 29646. We find it reasonable that the submitted Agreement be approved without
further notice or procedure. IDAP 31.01.01.204. We further find it reasonable to allow
payments made under the Agreement as prudently incurred expenses for ratemaking purposes.
CONCLUSIONS OF LAW
The Idaho Public Utilities Commission has jurisdiction over Idaho Power Company,
an electric utility, pursuant to the authority and power granted it under Title 61 of the Idaho Code
and the Public Utility Regulatory Policies Act of 1978 (PURP A).
The Commission has authority under PURP A and the implementing regulations of
the Federal Energy Regulatory Commission (FERC) to set avoided costs, to order electric
utilities to enter into fixed term obligations for the purchase of energy from qualified facilities
and to implement FERC rules.
ORDER NO. 29863
ORDER
In consideration of the foregoing and as more particularly described above, IT IS
HEREBY ORDERED and the Commission does hereby approve the June 27, 2005 Firm Energy
Sales Agreement between Idaho Power Company and Twin Falls Energy Company, Inc.
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within twenty-one (21) days of the service date of this Order. Within seven (7)
days after any person has petitioned for reconsideration, any other person may cross-petition for
reconsideration. See Idaho Code ~ 61-626.
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 'ilJ-k
day of September 2005.
MARSHA H. SMITH, COMMISSIONER
ENNIS S. HANS N, COMMISSIONER
ATTEST:
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fl1J1 D. Jew~ll.
Certnmission Secretary
bls/O:IPC-05-23 sw
ORDER NO. 29863