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-06-35
INCLUSION OF OMITTED PRICING INFORMATION IN THE FIRM
ENERGY SALES AGREEMENT BETWEEN IDAHO POWER AND
BENNETT CREEK WINDFARM.
On May 14,2013,Idaho Power Company (Idaho Power;Company)submitted for
Commission approval an Application to include additional pricing information to the
December 20,2006,Firm Energy Sales Agreement (Agreement)between Idaho Power and
Bennett Creek Windfarm LLC (Bennett Creek).The original Agreement is for a 20-year term and
was approved on February 20,2007,in Order No.30245.The First Amendment was approved on
August 8,2007,in Order No.30399.
BACKGROUND
In the original Agreement,Bennett Creek selected December31,2007 as the estimated
scheduled operation date for the Bennett Creek Windfarm Project (Project).The pricing schedule
contained in that Agreement extended 20 years from that date (through 2027).In the First
Amendment,Bennett Creek and Idaho Power agreed to amend the original Agreement to extend
the scheduled operation date for a period of approximately one year.However,at that time,the
pricing schedule in the Agreement was not updated to reflect the new scheduled operation date.
In April 2013,Bennett Creek 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 Bennett Creek
DECISION MEMORANDUM 1 JUNE 11,2013
with a letter setting forth the pricing to be applied to the last 12 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 file
an application seeking Commission approval of the pricing and verifying that Bennett Creek
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
Bennett Creek 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 Bennett Creek 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?
Cathleen McHugh
I udmcmosThennctt crcck.doc
DECISION MEMORANDUM 2 JUNE 11,2013