20061226Application.pdf

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Barton L. Kline
Senior Attorney
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An IDACORP company
December 26, 2006
Jean D. Jewell, Secretary
Idaho Public Utilities Commission
472 West Washington Street
P. O. Box 83720
Boise , Idaho 83720-0074
Re: Case No. IPC-06-
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 Idaho Winds
LLC for the Alkali Wind Generation Facility
Dear Ms. Jewell:
Please find enclosed for filing ' an original and seven (7) copies of Idaho Power
Company s Application for the above-referenced matter.
I would appreciate it if you would return a stamped copy of this transmittal letter in
the enclosed self-addressed , stamped envelope.
~I~
Barton L. Kline
BLK:sh
Enclosures
O. Box 70 (83707)
1221 W. Idaho St.
Boise, ID 83702
BARTON L. KLINE , ISB # 1526
MONICA B. MOEN, ISB # 5734
Idaho Power Company
1221 West Idaho Street
P. O. Box 70
Boise, Idaho 83707
Telephone: [phone]
FAX Telephone: [phone]
bkline ~ idahopower.com
mmoen ~ idahopower.com
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Attorneys for Idaho Power Company
Express Mail Address
1221 West Idaho Street
Boise, Idaho 83702
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 IDAHO WINDS LLC )
FOR THE ALKALI WIND GENERATIONFACILITY
CASE NO. IPC-06-3..b
APPLICATION
COMES NOW , Idaho Power Company ("Idaho Power" or "the Company ) and
pursuant to RP 52, hereby requests that the Commission issue its Order approving a
Firm Energy Sales Agreement (the "Agreement") between Idaho Power and Idaho
Winds LLC ("Idaho Winds ) under which Idaho Winds would sell and Idaho Power would
purchase electric energy generated by Idaho Wind's Alkali Wind Farm Facility located
approximately 6 miles northwest of Glenns Ferry, in Elmore County, Idaho ("Facility ). A
copy of the Agreement is enclosed herewith as Attachment 1 .
APPLICATION , Page
This Application is based on the following:
In interlocutory Order No. 29839 issued in Case No. IPC-05-, the
Commission reduced the size cap for OF wind generation facilities entitled to receive
the published avoided cost rates from 10 average megawatts to 100 kW. In Order No.
29839 , the Commission also identified several criteria that it would consider to
determine whether a particular OF wind generation facility, that had been in the
negotiation queue when Order No. 29839 was issued, was sufficiently mature so as to
justify "grandfathering" the wind generation facility to entitlement to the published rates.
These criteria are as follows:
(1) Submittal of a signed power purchase agreement to the utility, or(2) Submittal to the utility of completed Application for
Interconnection Study and payment of fee.
In addition to a finding of existence of one or both of the preceding
threshold criteria, the OF must also be able to demonstrate other indicia of
substantial progress and project maturity, e.
(1 )
(2)
(3)
(4)
A wind study demonstrating a viable site for the project
A signed contract for wind turbines
Arranged financing for the project , and/or
Related progress on the facility permitting and licensing path.
(Order No. 29839 , p. 10, August 4 2005; final Order No. 29851).
The Commission noted in Order No. 29872 in Case No. IPC-05-, that the
degree of substantial progress and project maturity that it would look for is a
demonstration that the OF project can be brought on-line in a timely manner and within
a reasonable period following contract execution and approval. The Commission stated
it would look at the totality of the facts presented.
APPLICATION , Page 2
II.
Following the issuance of reconsideration Order No. 29872 , the Commission has
reviewed several requests from wind OFs for grandfathering status. Of particular import
is Commission Order No. 29954, issued January 17 , 2006 in Case No. IPC-05-35 in
which Cassia Wind sought grandfather status for its tow wind farm projects
, ("
Cassia
Wind Order"). In the Cassia Wind Order the Commission determined that even though
as of the August 4 2005 cut-off date, Cassia Wind had not completed several important
secondary criteria, it would be reasonable for Cassia Wind to receive an exemption from
the published rate eligibility cap established in Order No. 29839 provided that Cassia
Wind was able to demonstrate that it had secured financing and obtained a turbine
commitment from John Deere Credit by January 4 , 2006.
III.
In this case , the Alkali Facility developer, Pacific Wind LLC, initially advised Idaho
Power that it did not desire to pursue a "grandfathering" determination. However, since
the issuance of the Cassia Wind order, the developer has decided to pursue a
grandfathered" contract. Based on Idaho Power Company s review of the information
provided by the developer and in light of the Commission s analysis in the Cassia Wind
order, Idaho Power has determined that it would be reasonable to grandfather the
Facility based on the following:
Primary Criteria:
Prior to Idaho Power filing its petition on June 17, 2005 in Case No. IPC-
05-
, ("
Suspension Petition ), Idaho Power and the Facility developer had completed
contract negotiations and were prepared to sign a Firm Energy Sales Agreement for this
APPLICATION , Page 3
Facility. At the time Idaho Power filed the Suspension Petition , Idaho Power advised
the developer that Idaho Power would not sign the Firm Energy Sales Agreement until
the Commission had considered the Suspension Petition.As noted above, the
developer initially decided not to pursue "grandfathering" but now desires to move
forward with the Facility. Idaho Power believes that in light of the fact that the parties
had fully negotiated and were ready to sign the FESA prior to August 5, 2005, the first
primary criteria should be deemed to have been met.
The second primary criteria described by the Commission in Order No.
29039 is submittal of a completed application for interconnection.The developer
submitted a generation interconnection study application for the Facility on January 31
2005 for a 10 MW project along with a $2 000 initial feasibility analysis fee. The
developer withdrew the application on May 26, 2005 at the recommendation of Idaho
Power Company s transmission group because the developer desired to increase the
Facility size to 18 MW. At that time Idaho Power Company s transmission group
correctly advised the developer that the interconnection application could not
amended but instead , a new application had to be filed. The developer decided to defer
submitting a revised generation interconnection application until the Power Purchase
Agreement was signed; an event which both Idaho Power and the developer believed
was imminent.
Secondary Criteria:
On August 15, 2005 the developer wrote to Idaho Power describing the
development status of the Facility. A copy of the August 15, 2005 letter is attached as
Attachment 2. As noted in the August 15 , 2005 letter, the developer did not, as of
APPLICATION , Page 4
August 5 2005 , have a signed contract for turbines.However, Idaho Power has
reviewed the information provided by the developer and confirmed that this developer
had determined that obtaining financing was the highest priority on the critical path.
Prior to August 4 , 2005 , the developer had obtained firm commitments to finance the
Facility. The Company had also confirmed that as of August 4, 2005, the Facility had
made substantial progress on the other secondary criteria, except for acquisition of
turbines. As in the case of Cassia Wind , the developer has now obtained a firm
commitment for turbines for the Facility. A copy of Idaho Power s November 7, 2006
letter to the developer confirming satisfaction of the required secondary commitments is
attached as Attachment 3.
IV.
Based on the foregoing, on December 12, 2006 , Idaho Power and Idaho Winds
LLC entered into a Firm Energy Sales Agreement ("Agreement") for the Facility
pursuant to the terms and conditions of Commission Order No. 29632. Under the terms
of that Agreement, Idaho Winds elected to contract with Idaho Power for a 20-year term.
Idaho Winds further elected to contract with the Company using the Non-Levelized
Published Avoided Cost Rates as currently established by the Commission for projects
that , under normal operating conditions, will not generate more than 10 aMW on a
monthly basis.
For the most part the Agreement contains terms and conditions identical to the
terms and conditions previously approved by the Commission in other Firm Energy
Sales Agreements between Idaho Power and various OFs. However, there are two
APPLICATION , Page 5
provisions that the Commission should be aware of in its consideration of this
Agreement.
In the negotiations of this project, Idaho Power and Idaho Winds
agreed that a Facility on-line date of December 2007 is crucial for various reasons. The
Agreement contains Delay Damage provisions that require Idaho Winds to pay Idaho
Power damages for on-line delays past December 31 , 2007 for a period of up to 90
days.
The Agreement reflects the changes to Idaho Power s Schedule 72
approved in Order No. 30179 issued on November 17, 2006 in Case No. IPC-06-18.
Consistent with Order No. 30179, the Agreement no longer contains certain provisions
covering interconnection issues that had previously been included in firm energy sales
agreements. Those provisions are now covered by Schedule 72 and the Uniform
Interconnection Agreement that is a part of Schedule 72.
VI.
Idaho Winds has indicated that the Facility will be an 18 MW wind generating
facility.The Facility will be a qualified small power production facility under the
applicable provisions of the Public Utilities Regulatory Policy Act of 1978 ("PURPA"
The Facility will consist of 12 GE wind turbines with individual generator ratings of 1.
MW for each unit for a total facility generator rating of 18 MW. As provided by the
Agreement, Idaho Winds will be required to provide data on the Facility that Idaho
Power will use to confirm that, under normal and/or average conditions, generation from
the Facility will not exceed 10 aMW on a monthly basis.
APPLICATION, Page 6
VII.
Idaho Winds has selected December 30 , 2007 as the Scheduled First Energy
Date and December 31 2007 as the Scheduled Operation Date for the Facility. As the
Agreement specifies , once a project requests and is assigned an Operation Date
various terms of the Agreement are activated, primarily the 90%/110% performance
criteria. The Agreement requires that only the monthly variable non-firm price for
energy be paid for any energy the Facility delivers to Idaho Power prior to the
assignment of an Operation Date for this project.
VIII.
Section 24 of the Agreement provides that the Agreement will not become
effective until the Commission has approved all of the Agreement's terms and
conditions and declared that all payments Idaho Power makes to Idaho Winds for
purchases of energy will be allowed as prudently incurred expenses for ratemaking
purposes.
IX.
Within this Agreement, various requirements have been placed upon Idaho
Winds in order for Idaho Power to accept energy deliveries from this project. Idaho
Power will confirm that the initial requirements have been completed prior to accepting
energy from this Facility. The Company will also monitor the ongoing requirements
through the full term of this Agreement.Should the Commission approve this
Agreement , Idaho Power intends to consider the Effective Date of the Agreement to be
December 12, 2007.
APPLICATION , Page 7
The Agreement, as signed and submitted by the Parties thereto, contains Non-
Levelized Published Avoided Cost Rates in conformity with applicable IPUC Orders.
XI.
Service of pleadings, exhibits, orders and other documents relating to this
proceeding should be served on the following:
Barton L. Kline, Senior Attorney
Monica B. Moen, Attorney II
Idaho Power Company
O. Box 70
Boise, Idaho 83707
bkline ~ idahopower.com
mmoen ~ idahopower.com
Ric Gale
VP-Pricing and Regulatory
Idaho Power Company
O. Box 70
Boise , Idaho 83707
rallphin ~ idahopower.com
NOW , THEREFORE , based on the foregoing, Idaho Power Company hereby
requests that the Commission issue its Order:
(1 )Approving the Firm Energy Sales Agreement between Idaho Power
Company and Idaho Winds without change or condition; and
(2)Declaring that all payments for purchases of energy under the Firm
Energy Sales Agreement between Idaho Power Company and Idaho Winds be allowed
as prudently incurred expenses for ratemaking purposes.
Respectfully submitted this day of December 2006.
BARTO
~/~
Attorney for Idaho Power Company
APPLICATION , Page 8
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
CASE NO. IPC-O6-
ID AH POWER COMPANY
ATTACHMENT NO.
APPLICA TION
Article
FIRM ENERGY SALES AGREEMENT
BETWEEN
IDAHO POWER COMPANY
AND
IDAHO WINDS LLC
TABLE OF CONTENTS
TITLE
Definitions
No Reliance on Idaho Power
Warranties
Conditions to Acceptance of Energy
Term and Operation Date
Purchase and Sale of Net Energy
Purchase Price and Method of Payment
Environmental Attributes
Facility and Interconnection
Metering and Telemetry
Records
Operations
Indemnification and Insurance
Force Majeure
Liability; Dedication
Several Obligations
Waiver
Choice of Laws and Venue
Disputes and Default
Governmental Authorization
Commission Order
Successors and Assigns
Modification
Taxes
Notices
Additional Terms and Conditions
Severability
Counterparts
Entire Agreement Signatures
Appendix A
Appendix B
Appendix C
12/08/2006
FilUM ENERGY SALES AGREEMENT
(10 aMW or Less)
ALKALI WIND FARM
Project Number: 21615200
..,-1-1THIS AGREEMENT, entered into on this ~ day of BE.C..2006 between
IDAHO WINDS LLC an Idaho limited liability company (Seller), and IDAHO POWER COMPANY, an
Idaho corporation (Idaho Power), hereinafter sometimes referred to collectively as "Parties" or
individually as "Party.
WITNESSETH:
WHEREAS, Seller will design, construct, own, maintain and operate an electric generation
facility; and
WHEREAS, Seller wishes to sell, and Idaho Power is willing to purchase, firm electric energy
produced by the Seller s Facility.
THEREFORE, In consideration of the mutual covenants and agreements hereinafter set forth, the
Parties agree as follows:
ARTICLE I: DEFINITIONS
As used in this Agreement and the appendices attached hereto, the following terms
shall have the following meanings:
1.1 Commission" - The Idaho Public Utilities Commission.
1.2 Contract Year" - The period commencing each calendar year on the same calendar date as the
Operation Date and ending 364 days thereafter.
1.3 Delay Liquidated Damages" - Damages payable to Idaho Power as calculated in paragraph 5.
5.4 5 and 5.
1.4 Delay Period" - All days past the Scheduled Operation Date until the Seller s Facility achieves
the Operation Date. This Delay Period shall not exceed 90 days.
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1.5
1.6
1.7
1.8
1.9
1.10
1.11
1.12
1.13
1.14
Delay Price" - The current month's Market Energy Cost minus the current month's Net Energy
Purchase Price specified in paragraph 7.1 of this Agreement. If this calculation results in a value
less than 0, the result of this calculation will be
Designated Dispatch Facility" - Idaho Power s Systems Operations Group, or any subsequent
group designated by Idaho Power.
Facility" - That electric generation facility described in Appendix B of this Agreement.
First Energy Date" - The day commencing at 0001 hours, Mountain Time, following the day that
Seller has satisfied the requirements of Article and the Seller begins delivering energy to
Idaho Power s system at the Point of Deli very.
Inadvertent Energy" - Electric energy Seller does not intend to generate. Inadvertent energy is
more particularly described in paragraph 7.3 of this Agreement.
Interconnection Facilities - All equipment specified in Schedule 72.
Initial Capacity Determination - The process by which Idaho Power confirms that under
normal or average design conditions the Facility will generate at no more than 10 average MW
per month and is therefore eligible to be paid the published rates in accordance with Commission
Order No. 29632.
Losses" - The loss of electrical energy expressed in kilowatt hours (kWh) occurring as a result
of the transformation and transmission of energy between the point where the Facility s energy is
metered and the point the Facility s energy is delivered to the Idaho Power electrical system. The
loss calculation formula will be as specified in Appendix B of this Agreement.
Market Energy Cost" - Eighty-five percent (85%) of the weighted average of the daily on-peak
and off-peak Dow Jones Mid-Columbia Index (Dow Jones Mid-C Index) prices for non-firm
energy. If the Dow Jones Mid-Columbia Index price is discontinued by the reporting agency, both
Parties will mutually agree upon a replacement index, which is similar to the Dow Jones Mid-
Columbia Index. The selected replacement index will be consistent with other similar agreements
and a commonly used index by the electrical industry.
Material Breach" - A Default (paragraph 19.2.1) subject to paragraph 19.
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1.15
1.16
1.17
1.18
1.19
1.20
1.21
1.22
1.23
1.24
1.25
Maximum Capacity Amount" - The maximum capacity (MW) of the Facility will be as
specified in Appendix B of this Agreement.
Metering Equipment"- All equipment specified in Schedule 72, this Agreement and any
additional equipment specified in Appendix B required to measure, record and telemeter power
flows between the Seller s electric generation plant and Idaho Power s system.
Net Energy" - All of the electric energy produced by the Facility, less Station Use, less Losses
expressed in kilowatt hours (kWh). Seller commits to deliver all Net Energy to Idaho Power at
the Point of Delivery for the full term of the Agreement. Net Energy does not include Inadvertent
Energy.
Operation Date" - The day commencing at 0001 hours, Mountain Time, following the day that
all requirements of paragraph 5.2 have been completed.
Point of Delivery" - The location specified in Appendix B, where Idaho Power s and the
Seller s electrical facilities are interconnected.
Prudent Electrical Practices" - Those practices, methods and equipment that are commonly and
ordinarily used in electrical engineering and operations to operate electric equipment lawfully,
safely, dependably, efficiently and economically.
Scheduled Operation Date" - The date specified in Appendix B when Seller anticipates
achieving the Operation Date.
Schedule 72"- Idaho Power s Tariff No 101, Schedule 72 or its successor schedules as
approved by the Commission.
Season" - The three periods identified in paragraph 6.1 of this Agreement.
Station Use" - Electric energy that is used to operate equipment that is auxiliary or otherwise
related to the production of electricity by the Facility.
Surplus Energy - (1) Net Energy produced by the Seller s Facility and delivered to the Idaho
Power electrical system during the month which exceeds 110% of the monthly Net Energy
Amount for the corresponding month specified in paragraph 6.2. or (2) If the Net Energy
produced by the Seller s Facility and delivered to the Idaho Power electrical system during the
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1.26
month is less than 90% of the monthly Net Energy Amount for the corresponding month
specified in paragraph 6., then all Net Energy delivered by the Facility to the Idaho Power
electrical system for that given month or (3) All Net Energy produced by the Seller s Facility and
delivered by the Facility to the Idaho Power electrical system prior to the Operation Date.
Total Cost of the Facility" - The total cost of structures, equipment and appurtenances.
ARTICLE II: NO RELIANCE ON IDAHO POWER
Seller fudependent fuvestigation - Seller warrants and represents to Idaho Power that in entering
into this Agreement and the undertaking by Seller of the obligations set forth herein, Seller has
investigated and determined that it is capable of performing hereunder and has not relied upon
the advice, experience or expertise of Idaho Power in connection with the transactions
contemplated by this Agreement.
Seller fudependent Experts - All professionals or experts including, but not limited to, engineers
attorneys or accountants, that Seller may have consulted or relied on in undertaking the
transactions contemplated by this Agreement have been solely those of Seller.
ARTICLE III: WARRANTIES
No Warranty by Idaho Power - Any review, acceptance or failure to review Seller s design
specifications, equipment or facilities shall not be an endorsement or a confirmation by Idaho
Power and Idaho Power makes no warranties, expressed or implied, regarding any aspect of
Seller s design, specifications, equipment or facilities, including, but not limited to, safety,
durability, reliability, strength, capacity, adequacy or economic feasibility.
Qualifying Facility Status - Seller warrants that the Facility is a "Qualifying Facility," as that term
is used and defined in 18 CFR 292.201 et seq. After initial qualification, Seller will take such
steps as may be required to maintain the Facility s Qualifying Facility status during the term of
this Agreement and Seller s failure to maintain Qualifying Facility status will be a Material
Breach of this Agreement. Idaho Power reserves the right to review the Seller s Qualifying
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Facility status and associated support and compliance documents at anytime during the term of
this Agreement.
ARTICLE IV: CONDITIONS TO ACCEPTANCE OF ENERGY
Prior to the First Energy Date and as a condition of Idaho Power s acceptance of deliveries of
energy from the Seller, Seller shall:
1.1
1.2
1.3
Submit proof to Idaho Power that all licenses, permits or approvals necessary for Seller
operations have been obtained from applicable federal, state or local authorities,
including, but not limited to, evidence of compliance with Subpart B, 18 CFR 292.201 et
seq. and a Qualifying Facility certificate.
Opinion of Counsel - Submit to Idaho Power an Opinion Letter signed by an attorney
admitted to practice and in good standing in the State of Idaho providing an
opinion that Seller s licenses, permits and approvals as set forth in paragraph 4.
above are legally and validly issued, are held in the name of the Seller and, based on
a reasonable independent review, counsel is of the opinion that Seller is in substantial
compliance with said permits as of the date of the Opinion Letter. The Opinion Letter
will be in a form acceptable to Idaho Power and will acknowledge that the attorney
rendering the opinion understands that Idaho Power is relying on said opinion. Idaho
Power s acceptance of the form will not be unreasonably withheld. The Opinion Letter
will be governed by and shall be interpreted in accordance with the legal opinion accord
of the American Bar Association Section of Business Law (1991).
Initial Capacity Determination - Submit to Idaho Power such data as Idaho Power may
reasonably require to perform the Initial Capacity Determination. Such data will include
but not be limited to, equipment specifications, prime mover data, resource
characteristics, normal and/or average operating design conditions and Station Use data.
Upon receipt of this information, Idaho Power will review the provided data and if
necessary, request additional data to complete the Initial Capacity Determination within a
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1.4
1.5
1.6
1.7
reasonable time.
Engineer s Certifications - Submit an executed Engineer s Certification of Design &
Construction Adequacy and an Engineer s Certification of Operations and Maintenance
(O&M) Policy as described in Commission Order No. 21690. These certificates will be
in the form specified in Appendix C but may be modified to the extent necessary to
recognize the different engineering disciplines providing the certificates.
msurance - Submit written proof to Idaho Power of all insurance required in Article XIII.
mterconnection - Provide written confirmation from Idaho Power s Delivery Business
Unit that Seller has satisfied all interconnection requirements.
Written Acceptance - Request and obtain written confirmation from Idaho Power that all
conditions to acceptance of energy have been fulfilled. Such written confirmation shall be
provided within a commercially reasonable time following the Seller s request and will
not be unreasonably withheld by Idaho Power.
ARTICLE V: TERM AND OPERATION DATE
Term - Subject to the provisions of paragraph 5.2 below, this Agreement shall become effective
on the date first written and shall continue in full force and effect for a period of twenty (20)
Contract Years from the Operation Date.
Operation Date - The Operation Date may occur only after the Facility has achieved all of the
following:
a) Achieved the First Energy Date.
b) Commission approval of this Agreement in a form acceptable to Idaho Power has
been received.
c) Seller has demonstrated to Idaho Power s satisfaction that the Facility is complete and
able to provide energy in a consistent, reliable and safe manner.
d) Seller has requested an Operation Date from Idaho Power in a written format.
e) Seller has received written confirmation from Idaho Power of the Operation Date.
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5.4
5.5
This confirmation will not be unreasonably withheld by Idaho Power.
Seller shall cause the Facility to achieve the Operation Date on or before the Scheduled Operation
Date. If the Operation Date occurs after the Scheduled Operation Date, Seller shall pay Idaho
Power Delay Liquidated Damages. Delay Liquidated Damages will be calculated monthly as
follows:
Delay Liquidated Damages are equal to ((Current month's Initial Year Net Energy
Amount as specified in paragraph 6.1 divided by the number of days in the current
month) multiplied by the current month's Delay Period) multiplied by the current
month's Delay Price.
Delay Liquidated Damages will be calculated for a maximum of ninety (90) days past the
Scheduled Operation Date. If Seller fails to achieve the Operation Date within ninety (90) days of
the Scheduled Operation Date, Idaho Power may terminate this Agreement.
Seller shall pay Idaho Power any calculated Delay Liquidated Damages within five (5) business
days of when Idaho Power calculates and presents any Delay Liquidated Damages billings to the
Seller. Seller s failure to pay these damages within the specified time will be a Material Breach
of this Agreement.
The Parties agree that the damages Idaho Power would incur due to delay in the Facility
achieving the Operation Date on or before the Scheduled Operation Date would be difficult or
impossible to predict with certainty, and that the Delay Liquidated Damages are an appropriate
approximation of such damages.
ARTICLE VI: PURCHASE AND SALE OF NET ENERGY
Delivery and Acceptance of Net Energy - Except when either Party s performance is excused as
provided herein, Idaho Power will purchase and Seller will sell all of the Net Energy to Idaho
Power at the Point of Delivery. All Inadvertent Energy produced by the Facility will also be
delivered by the Seller to Idaho Power at the Point of Delivery. At no time will the total amount
of Net Energy and/or Inadvertent Energy produced by the Facility and delivered by the Seller to
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12/08/2006
the Point of Delivery exceed the Maximum Capacity Amount.
Net Energy Amounts - Seller intends to produce and deliver Net Energy in the following monthly
amounts:
fuitial Year Monthly Net Energy Amounts:
Month kWh
Season 1
March
April
May
560 300
589,900
278 500
Season 2
July
August
November
December
193 800
048 400
100 900
402 300
Season 3
June
September
October
January
February
771 600
368 800
927,900
176 000
868 700
Ongoing Monthly Net Energy Amounts - Seller shall initially provide Idaho Power with
one year of monthly generation estimates (fuitial Year Monthly Net Energy Amounts)
and beginning at the end of month nine and every three months thereafter provide Idaho
Power with an additional three months of forward generation estimates. This information
will be provided to Idaho Power by written notice in accordance with paragraph 25., no
later than 5:00 PM of the 5th day following the end of the previous month. If the Seller
does not provide the Ongoing Monthly Net Energy Amounts in a timely manner, Idaho
Power will use the most recent 3 months of the fuitial Year Monthly Net Energy
Amounts specified in paragraph 6.1 for the next 3 months of monthly Net Energy
amounts.
Seller s Adjustment of Net Energy Amount
1 No later than the Operation Date, by written notice given to Idaho Power in
accordance with paragraph 25., the Seller may revise all of the previously
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2.4
provided Initial Year Monthly Net Energy Amounts.
2 Beginning with the end of the 3rd month after the Operation Date and at the end
of every third month thereafter: (l) the Seller may not revise the immediate next
three months of previously provided Net Energy Amounts , (2) but by written
notice given to Idaho Power in accordance with paragraph 25., no later than
5 :00 PM of the 5th day following the end of the previous month, the Seller may
revise all other previously provided Net Energy Amounts. Failure to provide
timely written notice of changed amounts will be deemed to be an election of no
change.
Idaho Power Adjustment of Net Energy Amount - If Idaho Power is excused from
accepting the Seller s Net Energy as specified in paragraph 12.1 or if the Seller declares
a Suspension of Energy Deliveries as specified in paragraph 12.1 and the Seller
declared Suspension of Energy Deliveries is accepted by Idaho Power, the Net Energy
Amount as specified in paragraph 6.2 for the specific month in which the reduction or
suspension under paragraph 12.1 or 12.1 occurs will be reduced in accordance with
the following:
Where:
NEA = Current Month's Net Energy Amount (Paragraph 6.
SGU =) If Idaho Power is excused from accepting the Seller s Net
Energy as specified in paragraph 12.1 this value will be
equal to the percentage of curtailment as specified by
Idaho Power multiplied by the TGU as defined below.
) If the Seller declares a Suspension of Energy Deliveries as
specified in paragraph 12.1 this value will be the sum of
the individual generation units size ratings as specified in
Appendix B that are impacted by the circumstances
causing the Seller to declare a Suspension of Energy
Deliveries.
TGU = Sum of all of the individual generator ratings of the generation
units at this Facility as specified in Appendix B of this
agreement.
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12/08/2006
RSH Actual hours the Facility s Net Energy deliveries were either
reduced or suspended under paragraph 12.1 or 12.3.1
Actual total hours in the current month
Resulting formula being:
Adjusted
Net Energy = NEA
Amount
SGU
X NEA
RSHTGU
) )
This Adjusted Net Energy Amount will be used in applicable Surplus Energy calculations for
only the specific month in which Idaho Power was excused from accepting the Seller s Net
Energy or the Seller declared a Suspension of Energy.
Unless excused by an event of Force Majeure, Seller s failure to deliver Net Energy in any
Contract Year in an amount equal to at least ten percent (10%) of the sum of the Initial Year Net
Energy Amounts as specified in paragraph 6.2 shall constitute an event of default.
ARTICLE VII: PURCHASE PRICE AND METHOD OF PAYMENT
Net Energy Purchase Price - For all Net Energy, Idaho Power will pay the non-Ievelized energy
price in accordance with Commission Order 29646 with seasonalization factors applied:
Season 1 - (73.50 %)Season 2 - (120,00 %)Season 3 - (100,00 %)
Year Mills/kWh Mills/kWh Mills/k Wh
2007 38.63.52.
2008 39.64.53.
2009 40.66.55.
2010 41.46 67.56.41
2011 42.42 69,57.
2012 43.70.59.
2013 44.72.48 60.40
2014 45.42 74,61.
2015 46.47 75.63.
2016 47.77.64.
2017 48,79.40 66.
2018 49.81.67.
2019 50.83.69.
2020 52,85.70.
2021 53.86.72.49
2022 54.88.74.
- 10-
12/08/2006
7.4
2023
2024
2025
2026
2027
55.
57.
58.
59.
61.
91.
93.
95.
97.
99.
75.
77.
79.41
81.
83.
Surplus Energy Price - For all Surplus Energy, Idaho Power shall pay to the Seller the current
month's Market Energy Cost or the Net Energy Purchase Price specified in paragraph 7.
whichever is lower.
Inadvertent Energy
Inadvertent Energy is electric energy produced by the Facility, expressed in kWh, which
the Seller delivers to Idaho Power at the Point of Delivery that exceeds 10,000 kW
multiplied by the hours in the specific month in which the energy was delivered. (For
example January contains 744 hours. 744 hours times 10,000 kW = 7,440,000 kWh.
Energy delivered in January in excess of 7,440, 000 kWh in this example would be
Inadvertent Energy.
Although Seller intends to design and operate the Facility to generate no more than 10
average MW and therefore does not intend to generate Inadvertent Energy, Idaho Power
will accept Inadvertent Energy that does not exceed the Maximum Capacity Amount but
will not purchase or pay for Inadvertent Energy
Payment Due Date - Energy payments to the Seller will be disbursed within 30 days of the date
which Idaho Power receives and accepts the documentation of the monthly Net Energy and
Inadvertent Energy actually produced by the Seller s Facility and delivered to Idaho Power as
specified in Appendix A.
Continuing Jurisdiction of the Commission - This Agreement is a special contract and, as such
the rates, terms and conditions contained in this Agreement will be construed in accordance with
Idaho Power Company v. Idaho Public Utilities Commission and Afton Energy, Inc , 107 Idaho
781 693 P.2d 427 (1984); Idaho Power Company v. Idaho Public Utilities Commission, 107
Idaho 1122 695 P.2d 1 261 (1985); Afton Energy, Inc, v. Idaho Power Company, 111 Idaho 925
- 11-
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10.
11.1
729 P.2d 400 (1986); Section 210 of the Public Utilities Regulatory Policies Act of 1978 and 18
CFR ~292:303-308.
ARTICLE VIII: ENVIRONMENTAL ATTRIBUTES
Idaho Power waives any claim to ownership of Environmental Attributes.Environmental
Attributes include, but are not limited to, Green Tags, Green Certificates, Renewable Energy
Credits (RECs) and Tradable Renewable Certificates (TRCs) directly associated with the
production of energy from the Seller s Facility.
ARTICLE IX: FACll.,ITY AND INTERCONNECTION
Design of Facility - Seller will design, construct, install, own, operate and maintain the Facility
and any Seller-owned Interconnection Facilities so as to allow safe and reliable generation and
delivery of Net Energy and Inadvertent Energy to the Idaho Power Point of Delivery for the full
term of the Agreement.
ARTICLE X: METERING AND TELEMETRY
Metering and Telemetry - Idaho Power shall, for the account of Seller, provide, install, and
maintain Metering Equipment to be located at a mutually agreed upon location to record and
measure power flows to Idaho Power in accordance with Schedule 72. The Metering Equipment
will be at the location and the type required to measure, record and report the Facility s Net
Energy, Station Use, Inadvertent Energy and maximum energy deliveries (kW) in a manner to
provide Idaho Power adequate energy measurement data to administer this Agreement and to
integrate this Facility s energy production into the Idaho Power electrical system.
ARTICLE XI - RECORDS
Maintenance of Records - Seller shall maintain at the Facility or such other location mutually
acceptable to the Parties adequate total generation, Net Energy, Station Use, Inadvertent Energy
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11.2
12.
12.
and maximum generation (kW) records in a form and content recommended by Idaho Power.
Inspection - Either Party, after reasonable notice to the other Party, shall have the right, during
normal business hours, to inspect and audit any or all generation, Net Energy, Station Use
Inadvertent Energy and maximum generation (kW) records pertaining to the Seller s Facility.
ARTICLE XII: OPERATIONS
Communications - Idaho Power and the Seller shall maintain appropriate operating
communications through Idaho Power s Designated Dispatch Facility in accordance with
Appendix A of this Agreement.
Energy Acceptance
12.1 Idaho Power shall be excused from accepting and paying for Net Energy or accepting
Inadvertent Energy produced by the Facility and delivered by the Seller to the Point of
Delivery, if it is prevented from doing so by an event of Force Majeure, or temporary
disconnection of the Facility in accordance with Schedule 72. If, for reasons other than
an event of Force Majeure, a temporary disconnection under Schedule 72 exceeds twenty
(20) days, beginning with the twenty-first day of such interruption, curtailment or
reduction, Seller will be deemed to be delivering Net Energy at a rate equivalent to the
pro rata daily average of the amounts specified for the applicable month in paragraph 6.
Idaho Power will notify Seller when the interruption, curtailment or reduction
terminated.
12.2 If, in the reasonable OpInIOn of Idaho Power, Seller s operation of the Facility or
Interconnection Facilities is unsafe or may otherwise adversely affect Idaho Power
equipment, personnel or service to its customers, Idaho Power may temporarily
disconnect the Facility from Idaho Power s transmission / distribution system as specified
within Schedule 72 or take such other reasonable steps as Idaho Power deems
appropriate.
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12.
12.3 Under no circumstances will the Seller deliver Net Energy and/or Inadvertent Energy
from the Facility to the Point of Delivery in an amount that exceeds the Maximum
Capacity Amount. Seller s failure to limit deliveries to the Maximum Capacity Amount
will be a Material Breach of this Agreement.
Seller Declared Suspension of Energy Deliveries
12.1 If the Seller s Facility experiences a forced outage due to equipment failure which is not
caused by an event of Force Majeure or by neglect, disrepair or lack of adequate
preventative maintenance of the Seller s Facility, Seller may, after giving notice as
provided in paragraph 12.2 below, temporarily suspend all deliveries of Net Energy to
Idaho Power from the Facility or from individual generation unit(s) within the Facility
impacted by the forced outage for a period of not less than 48 hours to correct the forced
outage condition ("Declared Suspension of Energy Deliveries ). The Seller s Declared
Suspension of Energy Deliveries will begin at the start of the next full hour following the
Seller s telephone notification as specified in paragraph 12.2 and will continue for the
time as specified (not less than 48 hours) in the written notification provided by the
Seller. In the month(s) in which the Declared Suspension of Energy occurred, the Net
Energy Amount will be adjusted as specified in paragraph 6.2.4.
12.2 If the Seller desires to initiate a Declared Suspension of Energy Deliveries as provided in
paragraph 12., the Seller will notify the Designated Dispatch Facility by telephone.
The beginning hour of the Declared Suspension of Energy Deliveries will be at the
earliest the next full hour after making telephone contact with Idaho Power. The Seller
will, within 24 hours after the telephone contact, provide Idaho Power a written notice in
accordance with Article XXV that will contain the beginning hour and duration of the
Declared Suspension of Energy Deliveries and a description of the conditions that caused
the Seller to initiate a Declared Suspension of Energy Deliveries. Idaho Power will
review the documentation provided by the Seller to determine Idaho Power s acceptance
of the described forced outage as qualifying for a Declared Suspension of Energy
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12.4
12.
12.
13.
Deliveries as specified in paragraph 12.1. Idaho Power s acceptance of the Seller
forced outage as an acceptable forced outage will be based upon the clear documentation
provided by the Seller that the forced outage is not due do an event of Force Majeure or
by neglect, disrepair or lack of adequate preventative maintenance of the Seller s Facility.
Scheduled Maintenance - On or before January 31 of each calendar year, Seller shall submit a
written proposed maintenance schedule of significant Facility maintenance for that calendar year
and Idaho Power and Seller shall mutually agree as to the acceptability of the proposed schedule.
The Parties determination as to the acceptability of the Seller s timetable for scheduled
maintenance will take into consideration Prudent Electrical Practices, Idaho Power system
requirements and the Seller s preferred schedule. Neither Party shall unreasonably withhold
acceptance of the proposed maintenance schedule.
Maintenance Coordination - The Seller and Idaho Power shall, to the extent practical, coordinate
their respective line and Facility maintenance schedules such that they occur simultaneously.
Contact Prior to Curtailment - Idaho Power will make a reasonable attempt to contact the Seller
prior to exercising its rights to interrupt interconnection or curtail deliveries from the Seller
Facility. Seller understands that in the case of emergency circumstances, real time operations of
the electrical system, and/or unplanned events Idaho Power may not be able to provide notice to
the Seller prior to interruption, curtailment, or reduction of electrical energy deliveries to Idaho
Power.
ARTICLE XTII: INDEMNIFICATION AND INSURANCE
Indemnification - Each Party shall agree to hold hannless and to indemnify the other Party, its
officers, agents, affiliates, subsidiaries, parent company and employees against all loss, damage
expense and liability to third persons for injury to or death of person or injury to property,
proximately caused by the indemnifying Party s construction, ownership, operation or
maintenance of, or by failure of, any of such Party s works or facilities used in connection with
this Agreement. The indemnifying Party shall, on the other Party s request, defend any suit
- 15-
12/08/2006
13.
13.
13.4
14.
asserting a claim covered by this indemnity. The indemnifying Party shall pay all costs , including
reasonable attorney fees that may be incurred by the other Party in enforcing this indemnity.
Insurance - During the term of this Agreement, Seller shall secure and continuously carry the
following insurance coverage:
13.1 Comprehensive General Liability Insurance for both bodily injury and property damage
with limits equal to $1 000 000, each occurrence, combined single limit. The deductible
for such insurance shall be consistent with current Insurance Industry Utility practices for
similar property.
13.2 The above insurance coverage shall be placed with an insurance company with an A.M.
Best Company rating of A- or better and shall include:
(a)An endorsement naming Idaho Power as an additional insured and loss payee as
applicable; and
(b)A provision stating that such policy shall not be canceled or the limits of liability
reduced without sixty (60) days ' prior written notice to Idaho Power.
Seller to Provide Certificate of Insurance - As required in paragraph 4.1.5 herein and annually
thereafter, Seller shall furnish Idaho Power a certificate of insurance, together with the
endorsements required therein, evidencing the coverage as set forth above.
Seller to Notify Idaho Power of Loss of Coverage - If the insurance coverage required by
paragraph 13.2 shall lapse for any reason, Seller will immediately notify Idaho Power in writing.
The notice will advise Idaho Power of the specific reason for the lapse and the steps Seller is
taking to reinstate the coverage. Failure to provide this notice and to expeditiously reinstate or
replace the coverage will constitute a Material Breach of this Agreement.
ARTICLE XN: FORCE MAJEURE
As used in this Agreement
, "
Force Majeure" or "an event of Force Majeure" means any cause
beyond the control of the Seller or of Idaho Power which, despite the exercise of due diligence
such Party is unable to prevent or overcome. Force Majeure includes, but is not limited to, acts of
- 16-
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15.
16.
God, fire, flood, storms, wars, hostilities, civil strife, strikes and other labor disturbances
earthquakes, fires, lightning, epidemics, sabotage, or changes in law or regulation occurring after
the Operation Date, which, by the exercise of reasonable foresight such party could not
reasonably have been expected to avoid and by the exercise of due diligence, it shall be unable to
overcome. If either Party is rendered wholly or in part unable to perform its obligations under
this Agreement because of an event of Force Majeure, both Parties shall be excused from
whatever performance is affected by the event of Force Majeure, provided that:
(1)The non-performing Party shall, as soon as is reasonably possible after the
occurrence of the Force Majeure, give the other Party written notice describing
the particulars of the occurrence.
(2)The suspension of perfonnance shall be of no greater scope and of no longer
duration than is required by the event of Force Majeure.
(3)No obligations of either Party which arose before the occurrence causing the
suspension of performance and which could and should have been fully
performed before such occurrence shall be excused as a result of such
occurrence.
ARTICLE XV: LIABILITY; DEDICATION
Nothing in this Agreement shall be construed to create any duty to, any standard of care with
reference to, or any liability to any person not a Party to this Agreement. No undertaking by one
Party to the other under any provision of this Agreement shall constitute the dedication of that
Party s system or any portion thereof to the other Party or to the public or affect the status of
Idaho Power as an independent public utility corporation or Seller as an independent individual or
entity.
ARTICLE XVI: SEVERAL OBLIGATIONS
Except where specifically stated in this Agreement to be otherwise, the duties, obligations and
liabilities of the Parties are intended to be several and not joint or collective. Nothing contained
- 17-
12/08/2006
17.
18.
18.
19.
19.2
in this Agreement shall ever be construed to create an association, trust, partnership or joint
venture or impose a trust or partnership duty, obligation or liability on or with regard to either
Party. Each Party shall be individually and severally liable for its own obligations under this
Agreement.
ARTICLE XVII: WANER
Any waiver at any time by either Party of its rights with respect to a default under this Agreement
or with respect to any other matters arising in connection with this Agreement shall not be
deemed a waiver with respect to any subsequent default or other matter.
ARTICLE XVIII: CHOICE OF LAWS AND VENUE
This Agreement shall be construed and interpreted in accordance with the laws of the State of
Idaho without reference to its choice of law provisions.
Venue for any litigation arising out of or related to this Agreement will lie in the District Court of
the Fourth Judicial District of Idaho in and for the County of Ada.
ARTICLE XIX: DISPUTES AND DEFAULT
Disputes - All disputes related to or arising under this Agreement, including, but not limited to
the interpretation of the terms and conditions of this Agreement, will be submitted to the
Commission for resolution.
Notice of Default-
19.Defaults.If either Party fails to perform any of the terms or conditions of this
Agreement (an "event of default"), the nondefaulting Party shall cause notice in
writing to be given to the defaulting Party, specifying the manner in which such
default occurred. If the defaulting Party shall fail to cure such default within the sixty
(60) days after service of such notice, or if the defaulting Party reasonably
demonstrates to the other Party that the default can be cured within a commercially
reasonable time but not within such sixty (60) day period and then fails to diligently
- 18-
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19.
19.2.
pursue such cure, then, the nondefaulting Party may, at its option, terminate this
Agreement and/or pursue its legal or equitable remedies.
Material Breaches - The notice and cure provisions in paragraph 19.1 do not apply
to defaults identified in this Agreement as Material Breaches. Material Breaches must
be cured as expeditiously as possible following occurrence of the breach.
Security for Performance - Prior to the Operation Date and thereafter for the full term of this
Agreement, Seller will provide Idaho Power with the following:
19.
19.
19.
Insurance - Evidence of compliance with the provisions of paragraph 13.2. If Seller
fails to comply, such failure will be a Material Breach and may only be cured by
Seller supplying evidence that the required insurance coverage has been replaced or
reinstated;
Engineer s Certifications - Every three (3) years after the Operation Date, Seller will
supply Idaho Power with a Certification of Ongoing Operations and Maintenance (0
& M) from a Registered Professional Engineer licensed in the State of Idaho, which
Certification of Ongoing 0 & M shall be in the form specified in Appendix C. Seller
failure to supply the required certificate will be an event of default. Such a default
may only be cured by Seller providing the required certificate; and
Licenses and Permits - During the full term of this Agreement, Seller shall maintain
compliance with all permits and licenses described in paragraph 4.1 of this
Agreement. In addition, Seller will supply Idaho Power with copies of any new or
additional permits or licenses. At least every fifth Contract Year, Seller will update the
documentation described in Paragraph 4.1. If at any time Seller fails to maintain
compliance with the permits and licenses described in paragraph 4.1 or to provide
the documentation required by this paragraph, such failure will be an event of default
and may only be cured by Seller submitting to Idaho Power evidence of compliance
from the permitting agency.
- 19-
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20.1
21.1
22.
23.
ARTICLE XX: GOVERNMENTAL AUTHORIZATION
This Agreement is subject to the jurisdiction of those governmental agencies having control over
either Party of this Agreement.
ARTICLE XXI: COMMISSION ORDER
This Agreement shall become finally effective upon the Commission s approval of all terms and
provisions hereof without change or condition and declaration that all payments to be made to
Seller hereunder shall be allowed as prudently incurred expenses for ratemaking purposes.
ARTICLE XXII: SUCCESSORS AND ASSIGNS
This Agreement and all of the terms and provisions hereof shall be binding upon and inure to the
benefit of the respective successors and assigns of the Parties hereto, except that no assignment
hereof by either Party shall become effective without the written consent of both Parties being
first obtained. Such consent shall not be unreasonably withheld. Notwithstanding the foregoing,
any party which Idaho Power may consolidate, or into which it may merge, or to which it may
conveyor transfer substantially all of its electric utility assets, shall automatically, without further
act, and without need of consent or approval by the Seller, succeed to all of Idaho Power s rights
obligations and interests under this Agreement. This article shall not prevent a financing entity
with recorded or secured rights from exercising all rights and remedies available to it under law
or contract. Idaho Power shall have the right to be notified by the financing entity that it is
exercising such rights or remedies.
ARTICLE XXIII: MODIFICATION
No modification to this Agreement shall be valid unless it is in writing and signed by both Parties
and subsequently approved by the Commission.
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24.
25.
26.1
ARTICLE XXN: TAXES
Each Party shall pay before delinquency all taxes and other governmental charges which, if failed
to be paid when due, could result in a lien upon the Facility or the Interconnection Facilities.
ARTICLE XXV: NOTICES
All written notices under this agreement may be sent via e-mail and then confirmed by US Mail.
All written notices shall be directed as follows and shall be considered delivered when deposited
in the U. S. Mail, first-class postage prepaid, as follows:
To Seller:Original document to:
Idaho Winds LLC
Attn: Rick Koebbe, President
5356 N. Cattail Way
Boise, Idaho 83714
E-mail: Rk(g)powerworks.com
To Idaho Power:
Original document to:
Vice President, Power Supply
Idaho Power Company
POBox 70
Boise, Idaho 83707
Copy of document to:
Cogeneration and Small Power Production
Idaho Power Company
POBox 70
Boise, Idaho 83707
Mail: Contact Idaho Power to get the current e-mail address.
ARTICLE XXVI: ADDITIONAL TERMS AND CONDITIONS
This Agreement includes the following appendices, which are attached hereto and included by
reference:
Appendix A
Appendix B
Appendix C
Generation Scheduling and Reporting
Facility and Point of Delivery
Engineer s Certifications
- 21-
12/0812006
ARTICLE XXVII: SEVERABILITY
27.The invalidity or unenforceability of any term or provision of this Agreement shall not affect the
validity or enforceability of any other terms or provisions and this Agreement shall be construed
in all other respects as if the invalid or unenforceable term or provision were omitted.
ARTICLE XXVIII: COUNTERPARTS
28,This Agreement may be executed in two or more counterparts, each of which shall be deemed an
original but all of which together shall constitute one and the same instrument.
ARTICLE XXIX: ENTIRE AGREEMENT
29.This Agreement constitutes the entire Agreement of the Parties concerning the subject matter
hereof and supersedes all prior or contemporaneous oral or written agreements between the
Parties concerning the subject matter hereof.
IN WITNESS WHEREOF, The Parties hereto have caused this Agreement to be executed
in their respective names on the dates set forth below:
Idaho Power Company Idaho Winds LLC
Rick Koebbe, President
Dated
':b-
\?
c..-
Dated
/z- pee- U7tJ'"
Idaho Power Seller
- 22-
12/08/2006
APPENDIX A
GENERATION SCHEDULING AND REPORTING
MONTHLY POWER PRODUCTION AND SWITCHING REPORT
At the end of each month the following required documentation will be submitted to:
Idaho Power Company
Attn: Cogeneration and Small Power Production
POBox 70
Boise, Idaho 83707
The Meter readings required on this report will be the reading on the Idaho Power Meter
Equipment measuring the Facility s total energy production, Station Usage, Inadvertent Energy delivered
to Idaho Power and the maximum generated energy (kW) as recorded on the Meter Equipment and/or any
other required energy measurements to adequately administer this Agreement.
- 23-
12/08/2006
Idaho Power Company
Cogeneration and Small Power Production
MONTHLY POWER PRODUCTION AND SWITCHING REPORT
Project Name
Month Year
Project Number:
Address
City
Meter Number:
End of Month kWh Meter Reading:
Beginning of Month kWh Meter:
Difference:
Times Meter Constant:
kWh for the Month:
Metered Demand:
Breaker Opening Record
Date Time Meter
Breaker Opening Reason Codes
Lack of Adequate Prime Mover
Forced Outage of Facility
Disturbance of IPCo System
Scheduled Maintenance
Testing of Protection Systems
Cause Unknown
Other (Explain)
State Zip
Facility
Output
Station
Usage
Phone Number:
Station
Usage
Metered
Maximum Generation
Net Generation
Breaker Closing Record
Date Time Meter
I hereby certify that the above meter readings are
true and correct as of Midnight on the last day of the
above month and that the switching record is accurate
and complete as required by the Firm Energy Sales
Agreement to which I am a Party.
Signature
- 24-
ROUTINE REPORTING
Reason
Date
12/0812006
Idaho Power Contact Information
DailyEnergy Production Reporting
Call daily by 10 a.ill.800-356-4328 or 800-635-1093 and leave the following
information:
Project Identification - Project Name and Project Number
Current Meter Reading
Estimated Generation for the current day
Estimated Generation for the next day
Planned and Unplanned Project outages
Call 800-345-1319 and leave the following information:
Project Identification - Project Name and Project Number
. Approximate time outage occurred
Estimated day and time of project coming back online
Seller s Contact Information
24-Hour Project Operational Contact
Name:
Telephone Number:
Cell Phone:
Project On-site Contact information
Name:
Telephone Number:
Cell Phone:
- 25-
12/08/2006
APPENDIX B
FACILITY AND POINT OF DELIVERY
PROJECT NO. 21615200
ALKALI WIND FARM
DESCRIPTION OF FACILITY
The Facility will consist of 12 GE wind turbines with individual generator ratings of 1.5 MW for
each unit, for a total Facility generator rating of 18 MW. Seller may substitute at any time prior
to the Operation Date, a different manufacturer and/or model wind turbine provided that the
aggregate nameplate rating of the Facility does not exceed 18 MW.
LOCATION OF FACILITY
Near: Approximately 6 miles northwest of Glenns Ferry, ill, nearest intersection Bennett Road
(Old Oregon Trail Road) at W. Wicher Road.
Section: 16, Township: T5S, Range: R9E Quarter: Northwest (T5S) County: Elmore, Idaho.
SCHEDULED FIRST ENERGY AND OPERATION DATE
Seller has selected December 30, 2007 as the estimated Scheduled First Energy Date.
Seller has selected December 3 L 2007 as the estimated Scheduled Operation Date.
In making these selections, Seller recognizes that adequate testing of the Facility and completion
of all requirements in paragraph 5.2 of this Agreement must be completed prior to the project
being granted an Operation Date. Idaho Power, based on the information supplied by the Seller
will schedule its construction in accordance with Schedule 72.
MAXIMUM CAPACITY AMOUNT: This value will be 18 MW which is consistent with the
value provided by the Seller to Idaho Power in accordance with Schedule 72. This value is the
maximum energy (MW) that potentially could be delivered by the Seller s Facility to the Idaho
- 26-
12/08/2006
Power electrical system at any moment in time.
POINT OF DELIVERY
Point of Delivery" means, unless otherwise agreed by both Parties, the point of where the
Seller s Facility s energy is delivered to the Idaho Power electrical system. Schedule 72 will
determine the specific Point of Delivery for this Facility. The Point of Delivery identified by
Schedule 72 will become an integral part of this Agreement.
LOSSES
If the Idaho Power Metering equipment is capable of measuring the exact energy deliveries by the
Seller to the Idaho Power electrical system at the Point of Delivery, no Losses will be calculated
for this Facility. If the Idaho Power Metering is unable to measure the exact energy deliveries by
the Seller to the Idaho Power electrical system at the Point of Delivery, a Losses calculation will
be established to measure the energy losses (kWh) between the Seller s Facility and the Idaho
Power Point of Delivery. This loss calculation will be initially set at 2% of the kWh energy
production recorded on the Facility generation metering equipment. At such time as Seller
provides Idaho Power with the electrical equipment specifications (transformer loss
specifications, conductor sizes, etc) of all of the electrical equipment between the Facility and the
Idaho Power electrical system, Idaho Power will configure a revised loss calculation formula to
be agreed to by both parties and used to calculate the kWh Losses for the remaining term of the
Agreement. If at anytime during the term of this Agreement, Idaho Power determines that the
loss calculation does not correctly reflect the actual kWh losses attributed to the electrical
equipment between the Facility and the Idaho Power electrical system, Idaho Power may adjust
the calculation and retroactively adjust the previous months' kWh loss calculations.
METERING AND TELEMETRY
Schedule 72 will determine the specific metering and telemetry requirements for this Facility. At
- 27-
12/08/2006
the minimum the Metering Equipment and Telemetry equipment must be able to provide and
record hourly energy deliveries to the Point of Delivery and any other energy measurements
required to administer this Agreement. These specifications will include but not be limited to
equipment specifications, equipment location, Idaho Power provided equipment, Seller provided
equipment, and all costs associated with the equipment, design and installation of the Idaho
Power provided equipment.Seller will arrange for and make available at Seller s cost
communication circuit(s) compatible to Idaho Power s communications equipment and dedicated
to Idaho Power s use terminating at the Idaho Power facilities capable of providing Idaho Power
with continuous instantaneous information on the Facilities energy production. Idaho Power
provided equipment will be owned and maintained by Idaho Power, with total cost of purchase
installation, operation, and maintenance, including administrative cost to be reimbursed to Idaho
Power by the Seller. Payment of these costs will be in accordance with Schedule 72 and the total
metering cost will be included in the calculation of the Monthly Operation and Maintenance
Charges specified in Schedule 72.
- 28-
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APPENDIX C
ENGINEER'S CERTIFICATION
OPERATIONS & MAINTENANCE POLICY
The undersigned behalf himself and
, hereinafter collectively referred to as "Engineer
hereby states and certifies to the Seller as follows:
That Engineer is a Licensed Professional Engineer in good standing in the State of Idaho.
That Engineer has reviewed the Firm Energy Sales Agreement, hereinafter "Agreement " between
Idaho Power Buyer and Seller dated
That the cogeneration or small power production project which is the subject of the Agreement
and this Statement is identified as IPCo Facility No.and is hereinafter referred to as
the "Project."
That the Project, which is commonly known as the , is located in
Section Township , Range , Boise Meridian County, Idaho.
That Engineer recognizes that the Agreement provides for the Project to furnish electrical energy
to Idaho Power for a twenty (20) year period.
That Engineer has substantial experience in the design, construction and operation of electric
power plants of the same type as this Project.
That Engineer has no economic relationship to the Design Engineer of this Project.
That Engineer has reviewed and/or supervised the review of the Policy for Operation and
Maintenance ("O&M") for this Project and it is his professional opinion that, provided said Project has
been designed and built to appropriate standards, adherence to said O&M Policy will result in the
- 29-
12/0812006
Project's producing at or near the design electrical output , efficiency and plant factor for a twenty (20)
year period.
That Engineer recognizes that Idaho Power, in accordance with paragraph 5.2 of the Agreement
is relying on Engineer s representations and opinions contained in this Statement.
10.That Engineer certifies that the above statements are complete, true and accurate to the best of his
knowledge and therefore sets his hand and seal below.
(P.E. Stamp)
Date
- 30-
12/08/2006
APPENDIX C
ENGINEER'S CERTIFICATION
ONGOING OPERATIONS AND MAINTENANCE
The undersigned , on behalf of himself and
hereinafter collectively referred to as "Engineer " hereby
states and certifies to the Seller as follows:
That Engineer is a Licensed Professional Engineer in good standing in the State of Idaho.
That Engineer has reviewed the Firm Energy Sales Agreement, hereinafter "Agreement
between Idaho Power Buyer and Seller dated
That the cogeneration or small power production project which is the subject of the Agreement
and this Statement is identified as IPCo Facility No.and hereinafter referred to as the
Project" .
That the Project, which is commonly known as the Project
is located at
That Engineer recognizes that the Agreement provides for the Project to furnish electrical energy
to Idaho Power for a twenty (20) year period.
That Engineer has substantial experience in the design, construction and operation of electric
power plants of the same type as this Project.
That Engineer has no economic relationship to the Design Engineer of this Project.
That Engineer has made a physical inspection of said Project, its operations and maintenance
records since the last previous certified inspection. It is Engineer s professional opinion, based on the
Project's appearance , that its ongoing O&M has been substantially in accordance with said O&M Policy;
that it is in reasonably good operating condition; and that if adherence to said O&M Policy continues, the
Project will continue producing at or near its design electrical output, efficiency and plant factor for the
- 31-
12/08/2006
remaInIng years of the Agreement.
That Engineer recognizes that Idaho Power in accordance with paragraph 5.2 of the Agreement
is relying on Engineer s representations and opinions contained in this Statement.
10.That Engineer certifies that the above statements are complete, true and accurate to the best of his
knowledge and therefore sets his hand and seal below.
(P .E. Stamp)
Date
- 32-
12/08/2006
APPENDIX C
ENGINEER'S CERTIFICATION
DESIGN & CONSTRUCTION ADEQUACY
The undersigned behalf himself and
, hereinafter collectively referred to as "Engineer
hereby states and certifies to Idaho Power as follows:
That Engineer is a Licensed Professional Engineer in good standing in the State of Idaho.
That Engineer has reviewed the Firm Energy Sales Agreement, hereinafter "Agreement"
between Idaho Power as Buyer, and as Seller, dated
That the cogeneration or small power production project, which is the subject of the
Agreement and this Statement, is identified as IPCo Facility No and is hereinafter
referred to as the "Project"
That the Project, which is commonly known as the
Project, is located in Section , Township , Range , Boise Meridian
County, Idaho.
That Engineer recognizes that the Agreement provides for the Project to furnish electrical
energy to Idaho Power for a ) year period.
That Engineer has substantial experience in the design, construction and operation of
electric power plants of the same type as this Project.
That Engineer has no economic relationship to the Design Engineer of this Project and
has made the analysis of the plans and specifications independently.
That Engineer has reviewed the engineering design and construction of the Project
including the civil work, electrical work, generating equipment, prime mover conveyance system, Seller
furnished Interconnection Facilities and other Project facilities and equipment.
- 33-
12/08/2006
That the Project has been constructed in accordance with said plans and specifications, all
applicable codes and consistent with Prudent Electrical Practices as that term is described in the
Agreement.
10.That the design and construction of the Project is such that with reasonable and prudent
operation and maintenance practices by Seller, the Project is capable of performing in accordance with the
terms of the Agreement and with Prudent Electrical Practices for a ) year period.
11.That Engineer recognizes that Idaho Power, in accordance with paragraph 5.2 of the
Agreement, in interconnecting the Project with its system, is relying on Engineer s representations and
opinions contained in this Statement.
12.That Engineer certifies that the above statements are complete, true and accurate to the
best of his knowledge and therefore sets his hand and seal below.
(P.E. Stamp)
Date
- 34-
12/08/2006
EFO RE THE
IDAHO PUBLIC UTILITIES COMMISSION
CASE NO. IPC-O6-
ID AH POWER CO MP ANY
ATTACHMENT NO. 2
APPLICATION
Pacific Winds LLc
19 August 2005 hand-delivered
Idaho Power Company
1221 West Idaho Street
Boise , Idaho 83702
Attention: Mr. Randy Allphin, Contract Administrator
Subject:PPA Contract PURPA Eligibility Criteria
18 MW Alkali Wind Project
Dear Randy:
As mentioned during our telephone conversation, I have been traveling and did not receive
your letter dated August 8 2005 until I returned from vacation on August 16, 2005. Although it
was impossible to meet your August 15, 2005 deadline for submittal of the information and
documentation contained in your letter, we have responded as quickly as possible with the
enclosed information.
Pursuant to your August 8, 2005 letter (attached for reference) outlining the PURPA OF power
purchase agreement ("PPA") eligibility criteria for wind generation projects greater than 1
, as recently established by the Idaho Public Utilities Commission ("IPUC") in its Order No.
29839, please find attached the following information and documentation concerning our 18
MW Alkali wind project. We believe that the following will demonstrate that this project meets
the IPUC's eligibility criteria for PURPA wind generation greater than 100 kW.
Submittal of a signed PPA. As you know, on June 14, 2005, we e-mailed Idaho Power
Company ("I PC") an electronic file of the completed PPA "ready to sign , attached for
reference. The PPA would have been signed by us immediately upon return from IPC
however, this did not happen because IPC subsequently filed a petition with IPUC on June 17
2005 to suspend its obligation to enter into new wind power OF contracts. The foregoing was
documented in our July 1 , 2005 letter to IPUC, which IPC received a copy, attached for
reference.
Submittal of a completed Application for Interconnection. We submitted a
generation interconnection application on January 31 2005 for a 10 MW project along with a
5356 N. Cattail Way, Boise, Idaho 83714
phone [phone]. e-mail rklW.powerworks.com . www.powerworks.com
IPC - PPA Eligibility Criteria, August 19, 2005
000 initial feasibility analysis fee attached for reference. We withdrew this application on
May 26 2005 at the recommendation of lPG's transmission group because we increased the
project size to 18 MW, consistent with our PPA request-lPG's transmission group said that
we could not modify our existing application , but instead, must re-file a new application, even
though it's the same project. However, we were waiting to submit a revised 18 MW generation
interconnection application until of the execution of the PPA contract because if IPC, for some
unknown reason, would not sign the PPA , then we would of lost our $10 000 application fee
deposit.
FERC QF certificate for the project. A copy of FERC OF Self-certification (Docket No.
OF05-, dated January 25, 2005) was submitted to IPC on January 31 , 2005 (attached for
reference), along with the project's generation interconnection application. You acknowledged
receipt of this documentation in your letter. As you know, we discussed the timing to increase
the FERC OF size from 10 MW to 18 MW, but you said it was unimportant to IPC until the
project was ready to startup in 2007 , i.e., the FERC OF filing was important but the project size
was not, until later. As background , we initially began with a 10 MW project size because we
believed that the IPUG OF contracts limited us to 10 MW, but we learned later that it was 10
MW monthly average, which allowed us to increase the project size to 18 MW.
Wind study for the project. Please find attached excerpts from our confidential long-
term wind study report for this project dated March 10, 2005 as prepared by Wind Logics Inc.
Furthermore, we have a 50 meter meteorological tower installed at the project site collecting
wind data. All information confirms the economic feasibility of the proposed wind project under
the Idaho published avoided cost rates as of June 2004.
Project and access road site control. Please find attached excerpts from our
confidential 35-year land lease agreement dated January 21 , 2005 for this project.
Signed contract for wind turbines. This project has a PPA on-line date of September
2007. It is customary to enter into a contract for the supply of wind turbines approximately one
year before project startup, when issues that affect the details of the supply order have been
addressed and resolved-issues relating to permitting, utility interconnection , site engineering,
and turbine supply availability, to name just a few. It is not practical or reasonable to require a
signed wind turbine supply contract two years in advance of startup, as you suggest.
Furthermore, as an alternative, as provided for in our permit application , we could use our
existing 100 kW wind turbines currently installed at Altamont Pass, California (we currently own
900 x 100 kW wind turbines) for this project, and therefore, a signed wind turbine supply
contract is not necessary.
Project financing. Please find attached a financing commitment letter for this project
dated June 15, 2005 from our lender, Trust Company of the West.
2.f Permitting and licensing. Please find attached copies of the applicable Elmore County
permit applications dated May 10, 2005 for this project (conditional use, variance, zoning, and
zoning change permits). We have had a series of meetings with the Elmore County Growth
and Development Director, and we understand it will require only about three months to obtain
these permits.
-- The remainder of this page left intentionally blank
5356 N. Cattail Way, Boise, Idaho 83714
phone [phone]. e-mail rk(Ci).powerworks.com . Www.powerworks.com
IPC - PPA Eligibility Criteria, August 19,2005
Thank you for your attention to this matter and please contact me if you have any questions.
We look forward to hearing from you.
Sincerely,
Rick Koebbe
President
Attachments
cc:Mr. Rick Sterling, Idaho Public Utilities Commission (hand-delivered)
5356 N. Cattail Way, Boise, Idaho 83714
phone [phone]. e-mail rkai),powerworks.com . www.powerworks.com
EFO RE THE
IDAHO PUBLIC UTILITIES COMMISSION
CASE NO. IPC-O6-
ID AH POWER CO MP ANY
ATTACHMENT NO. 3
APPLICA TION
An IDACG;:;: Company
November 17 2006
Randy C. Allphin
Contract Administrator
Idaho Winds LLC
Attn: Rick Koebbe, President
5356 N. Cattail Way
Boise, ill 83714
E-mail Copy:Rick Koebbe - rk(!!)powerworks.com
Original: US Mail
RE:Alkali and the Black Mesa Wind Farm
Entitlement to Published Avoided Cost Rates.
Dear Mr Koebbe;
As specified and agreed to in the letter agreement between Idaho Power and Idaho Winds LLC
dated November 15, 2006, there were various requirements that Idaho Winds LLC needed to complete in
order for Idaho Power to provide Firm Energy Agreements for these projects. Summarized below are
these requirements and the status as of the date of this letter.
1.) IPUC approval required -
Upon execution of final agreements for these projects by both parties, Idaho Power will
file the agreements with the IPUC seeking their approval. Only after IPUC approval has
been received as specified in the agreements shall the agreements be considered effective
and binding on both parties.
) By December 15, 2006
) Wind Turbine Supply
Idaho Wind LLC has provided Idaho Power with documentation from GE
Energy that GE will supply wind turbines for these projects in a time frame to
meet the required 2007 project on line date.
................""..."...................................... ",.."............
Page 1 of 2
Telephone: [phone] Fax: [phone] Rallphin (g) IdahopowcLcom
POBox 70 Boise, Idaho 83707 1221 West Idaho Boise, Idaho 83702
) Financing Secured
Idaho Wind LLC has provided Idaho Power Company a letter from Trust
Company of West ("TCW"), that TCW will provide the financing for these
projects as they had previously advised..
) Interconnection
Idaho Wind LLC has provided a copy of a cover letter sent to the Idaho Power
interconnection group which indicates that interconnection applications have
been made. In addition, the Idaho Power interconnection personnel have
confirmed that the applications submitted are complete.
As of the date of this letter, Idaho Power confirms that all items required to be completed by
November 15 2006 have been satisfied. Idaho Power will prepare a draft firm energy sales agreement for
Idaho Wind LLC's review.
If you have any questions please contact me at your convenience.
Very truly yours,
~(O.
Randy C. Allphin
Idaho Power Company
Contract Administrator
cc:Mark Stokes (IPCo)
Bart Kline (IPCo)
Rick Sterling (IPUC)
Scott Woodbury (IPUC
Page 2 of 2
Telephone: [phone] Fax: [phone] Rallphin (!P ldahopower.com
POBox 70 Boise, Idaho 83707 1221 West Idaho Boise, Idaho 83702