20070119notice_of_application_order_no_30221.pdf

Office of the Secretary
Service Date
January 19, 2007
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION
OF IDAHO POWER COMPANY FOR
APPROVAL OF A POWER PURCHASE
AGREEMENT WITH IDAHO WINDS, LLC NOTICE OF APPLICATION
CASE NO. IPC-06-
NOTICE OF
MODIFIED PROCEDURE
ORDER NO. 30221
On December 26, 2006, Idaho Power Company ("Idaho Power" or "Company ) filed
an Application with the Commission requesting approval of a 20-year Firm Energy Sales
Agreement between Idaho Power and Idaho Winds LLC dated December 12, 2006
Agreement"
BACKGROUND
On August 4, 2005, the Idaho Public Utilities Commission ("Commission ) in Case
No. IPC-05-, Order No. 29839, reduced the eligibility cap for avoided cost published rates
for non-firm wind projects from 10 aMW to 100 kW, required individual negotiation for larger
wind qualifying facilities (QFs), and established criteria for assessing QF contract entitlement.
Reference Public Utility Regulatory Policies Act of 1978 (PURP A). By Commission Order No.
29872 the date for grandfathering eligibility was changed from July 1 , 2004, the Notice of
Petition date, to August 4 2005, the date ofInterlocutory Order No. 29839.
NOTICE OF APPLICATION
YOU ARE HEREBY NOTIFIED that according to the Application, the wind
generating facility is known as the Alkali Wind Farm Facility ("Facility ) and will be located
approximately six miles northwest of Glenns Ferry in Elmore County, Idaho. Idaho Winds
warrants the 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
Facility will consist of 12 GE wind turbines with individual generator ratings of 1.5 MW for
each unit, for a total facility nameplate generator rating of 18 MW. The Agreement contains the
non-Ievelized, published avoided cost rates set forth in Order No. 29391. Under normal and/or
average operating conditions, Idaho Winds will not generate more than 10 aMW on a monthly
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 30221
basis. Energy delivered in excess of this monthly amount is Inadvertent Energy. Idaho Power
will accept Inadvertent Energy that does not exceed the maximum capacity amount (18 MW) but
will not purchase or pay for Inadvertent Energy. Agreement ~ 7.3.2.
YOU ARE FURTHER NOTIFIED that based on Idaho Power s review of the
information provided by the developer and in light of the procedure the Commission accepted in
Cassia Wind Order No. 29954, Case No. IPC-05-, Idaho Power has determined that it would
be reasonable to grandfather the Facility based on satisfaction of the criteria identified by the
Commission in Order No. 29839, Case No. IPC-05-22. According to the subject Application
Idaho Winds submitted a signed Firm Energy Sales Agreement to Idaho Power for the Facility.
In addition, Idaho Winds submitted a generation interconnection study for the Facility on
January 31 , 2005 for a 10 MW project along with a $2 000 initial feasibility analysis fee. Idaho
Power asserts that this threshold criteria is, therefore, satisfied.
YOU ARE FURTHER NOTIFIED that Idaho Power believes the secondary criteria
is that the QF demonstrate other indicia of substantial progress or maturity, usually by showing:
(1) a wind study demonstrating a viable site for the project, (2) a signed contract for wind
turbines, (3) arranged financing for the project, and/or (4) related progress on the Facility
permitting and license path. Id. The Application states that Idaho Winds wrote a letter to Idaho
Power on August 15, 2005 describing the status of the Facility. As of August 4, 2005, Idaho
Winds had obtained firm commitments to finance the Facility. Idaho Winds also had made
substantial progress on the other criteria, except for the acquisition of turbines. At this time
Idaho Winds has obtained a firm commitment for turbines for the Facility.
YOU ARE FURTHER NOTIFIED that according to the Application, there are two
provisions the Commission should be aware of in its consideration of the Agreement:
1. In the negotiations of this project, Idaho Power and Idaho Winds agreed
that an on-line date of December 2007 is crucial. This Agreement
contains delay damage provisions that require the project pay Idaho
Power damages if the project comes on-line after December 31 , 2007.
The delay damages will accrue for a period of up to 90 days.
2. The Agreement reflects the changes to Idaho Power s Schedule 72
(Uniform Interconnection Agreement) approved in Order No. 30179
issued on November 17 2006 in Case No. IPC-06-18.
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 30221
YOU ARE FURTHER NOTFIED that Idaho Winds has selected December 30 2007
as the Scheduled First Energy Date and December 31 , 2007 as the Scheduled Operation Date.
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.
YOU ARE FURTHER NOTIFIED that Idaho Power requests that the Commission
issue an Order approving the Firm Energy Sales Agreement and declaring that all payments for
purchases of energy under the Agreement be allowed as prudently incurred expenses for
ratemaking purposes.
NOTICE OF MODIFIED PROCEDURE
YOU ARE FURTHER NOTIFIED that the Commission has reviewed the
Application in this case and has preliminarily determined that the public interest in this matter
may not require a hearing to consider the issues presented, and that the issues raised by the
Application may be processed under Modified Procedure , by written submission rather
than by hearing. IDAPA 31.01.01.210-204. The Commission notes that Modified Procedure
and written comments have proven to be an effective means for obtaining public input and
participation.
YOU ARE FURTHER NOTIFIED that the deadline for filing written comments or
protests with respect to Idaho Power s Application and the use of Modified Procedure in this
case is twenty-one (21) days from the service date of this Order. The comment must contain a
statement of reasons supporting the comment. Persons desiring a hearing must specifically
request a hearing in their written comments. Written comments concerning this Application
shall be mailed to the Commission and the Applicant at the addresses reflected below:
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 30221
Idaho Public Utilities Commission
Commission Secretary
PO Box 83720
Boise, ID 83720-0074
Street Address for Express Mail:
472 W. Washington Street
Boise, Idaho 83702-5983
Barton L. Kline, Senior Attorney
Monica Moen, Attorney II
Idaho Power Company
PO Box 70
Boise, ID 83707-0070
E-mail: bkline~idahopower.com
mmoen~idahopower .com
Ric Gale
VP-Pricing and Regulatory
Idaho Power Company
PO Box 70
Boise, ID 83707-0070
E-mail: rgale~idahopower.com
These comments should contain the case caption and case number shown on the first page of this
document. Persons desiring to submit comments via e-mail may do so by accessing the
Commission s home page located at www.puc.idaho.gov. Click the "Comments and Questions
icon, and complete the comment form using the case number as it appears on the front of this
document. These comments must also be sent to Idaho Power at the e-mail addresses listed
above.
YOU ARE FURTHER NOTIFIED that the Application has been filed with the
Commission and is available for public inspection during regular business hours at the
Commission offices. The Application is also available on the Commission s Website at
www.puc.idaho.gov under "File Room" and then "Electric Cases.
YOU ARE FURTHER NOTIFIED that if no written comments or protests are
received within the time limit set, the Commission may consider the matter on its merits and may
enter its Order without a formal hearing. If written comments or protests are received within the
deadline, the Commission will consider them and in its discretion may set the matter for hearing
or may decide the matter and issue its Order based on the written comments before it. IDAP A
31.01.01.204.
YOU ARE FURTHER NOTIFIED that the Commission has jurisdiction over this
matter pursuant to Title 61 of the Idaho Code, and specifically Idaho Code ~~ 61-301, 61-307
61-622 and 61-623.
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 30221
ORDER
IT IS HEREBY ORDERED that the Application of Idaho Power Company be
processed by Modified Procedure, IDAP A 31.01.01.201-204. Persons interested in submitting
written comments in this matter must do so no later than twenty-one (21) days from the service
date of this Order.
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this
/~ p
day of January 2007.
/2IlidU-
PAUL KJELLANDER, PRESIDENT
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MARSHA H. SMITH, COMMISSIONER
ATTEST:
Co mission Secretary
O:IPC-O6-
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 30221