20130614Decision Memo.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER REDFORD
COMMISSIONER SMITH
COMMISSION SECRETARY
COMMISSION STAFF
FROM:CATHLEEN MCHUGH
DATE:JUNE 11,2013
SUBJECT:CASE NO.IPC-E-06-10
INCLUSION OF OMITTED PRICING INFORMATION IN THE FIRM
ENERGY SALES AGREEMENT BETWEEN IDAHO POWER AND
CASSIA WIND FARMS.
On May 14,2013,Idaho Power Company (Idaho Power;Company)submitted for
Commission approval an Application to include additional pricing information to the
April 7,2006,Firm Energy Sales Agreement (Agreement)between Idaho Power and Cassia Wind
Farms,LLC (Cassia Wind).The original Agreement is for a 20-year term and was approved on
June 30,2006,in Order No.30086.
BACKGROUND
In the original Agreement,Cassia Wind selected December 31,2006 as the estimated
scheduled operation date for the Cassia Wind Windfarm Project (Project).The pricing schedule
contained in that Agreement extended 21 years from that date (through 2027).However,Cassia
Wind did not meet that scheduled operation date.The actual operation date for the Project was 27
months after the estimated scheduled operation date.Therefore,the pricing schedule conlained in
the Agreement does not extend through the full term of the Agreement.
In April 2013,Cassia Wind notified Idaho Power that the 20-year pricing schedule did not
extend for the full term of the Agreement.The pricing contained in the Agreement is based upon
the standard published avoided cost rates in effect at the time the Agreement was executed and in
accordance with Order No.29646.On May 3,2013,Idaho Power provided Cassia Wind with a
DECISION MEMORANDUM I JUNE 11,2013
letter setting forth the pricing to be applied to the last 24 months of the term of the Agreement
based upon the standard published avoided cost rates in effect at the time.
STAFF REVIEW
Idaho Power states in its Application that the Company attempted to notify the
Commission of its additional pricing by letter.Commission Staff requested that Idaho Power tile
an application seeking Commission approval of the pricing and verifying that Cassia Wind
acquiesced in the pricing additions.Staff has verified that the prices provided by Idaho Power are
based upon the standard published avoided cost rates in effect at the time and in accordance with
OrderNo.29646.In addition,the Commission was notified by a letter dated May 31,2013,that
Cassia Wind agrees,understands and accepts the updated pricing.
STAFF RECOMMENDATION
Staff’recommends that the Commission approve the inclusion of these additional prices
into the terms of the Agreement between Idaho Power and Cassia Wind without further process.
COMMISSION DECISION
Does the Commission wish to approve,without further process,the inclusion of pricing
information so that the pricing schedule extends through the full term of the Agreement?
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Cathleen Mchugh
I udmemos/cassia wind.doc
DECISION MEMORANDUM 2 JUNE 11,2013