20070313Answer to Exergy's motion to close docket.pdf

THE LAW OFFICE OF
PAINE, HAMBLEN LLP
R. Blair Strong
Partner
r. blair. strongC9)painehamblen. com
717 WEST SPRAGUE AVENUE
SUITE 1200
SPOKANE, WASHINGTON 99201-3505
[phone]
FAX: [phone]
www.painehamblen.com
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March 12, 2007
Ms. Jean D. Jewell
Commission Secretary
Idaho Public Utilities Commission
472 West Washington
Boise, Idaho 83702
VIA FEDERAL EXPRESS
RE:Case No. IPC-O5-
In The Matter Of the Petition of Idaho Power Company For An Order
Temporarily Suspending Idaho Power s PURPA Obligation
Dear Ms. Jewell:
Enclosed for filing please find the original and seven copies of the Answer of A vista
Corporation to Exergy Developmet Group of Idaho s Motion for Order to Close This Docket
and Reinstate the 10 MW Threshold for PacifiCorp and A vista as well as a Motion for Limited
Admission for R. Blair Strong in the above-referenced matter.
If you should have any questions, please do not hesitate to contact me. Please conform
and return the additional copies in the enclosed self-addressed stamped envelope. Thank you for
your assistance.
Very truly yours
PAINE HAMBLEN LLP
'i? T5 kr-
R. Blair Strong
I:\Spodocs\I IIS0\O4137\ltr\OO4418 I4.DOC
Enclosurecc: Service List
Limited Liability PartnershiP
Offices in Spokane. Coeur d'Alene . Kennewick
David J. Meyer
, Chief Counsel for Regulatory and
Governmental Affairs
Avista Corporation
PO Box 3727
1411 East Mission Avenue, MSC-
Spokane, W A 99220-3727
Telephone: [phone]'
Facsimile: 509-495-8851
Jerry K. Boyd (Idaho Bar #1341)
R. Blair Strong (Pro Hac Vice)
Paine, Hamblen, Coffin, Brooke & Miller LLP
717 West Sprague, Suite 1200
Spokane, W A 99220-3505
Telephone: [phone]
Facsimile: 509-838-00007
Attorneys for A vista Corporation
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BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE PETITION OF
IDAHO POWER COMPANY FOR AN
ORDER TEMPORARILY SUSPENDING
IDAHO POWER'S PURP A OBLIGATION TO )
ENTER INTO CONTRACTS TO PURCHASE)
ENERGY GENERATED BY WIND-
POWERED SMALL POWER PRODUCTIONFACILITIES
No. IPC-05-
ANSWER OF A VISTA
CORPORATION TO EXERGY
DEVELOPMENT GROUP OF IDAHO'
MOTION FOR ORDER TO CLOSE
THIS DOCKET AND REINSTATE
THE 10 MW THRESHOLD FOR
ACIFICORP AND A VISTA
INTRODUCTION
Avista Corporation ("Avista ) answers the Motion of Exergy Development Group of
Idaho ("Exergy ), and requests the Commission to deny Exergy s motion.
Exergy is requesting the Commission, in effect, to rescind or amend a final order and
revise existing PURP A rates applicable to wind projects larger than 100 kW, although Exergy
has no standing to initiate a Commission proceeding to change rates. Also, Exergy is asking the
ANSWER OF A VISTA CORPORATION TO EXERGY
DEVELOPMENT GROUP OF IDAHO'S MOTION FOR
ORDER TO CLOSE THIS DOCKET AND REINSTATE
THE 10 MW THRESHOLD FOR PACIFICORP AND
AVISTA- PAGE
Commission to amend or rescind its prior order as applied to A vista before A vista has had an
opportunity to present its recommendations and study conclusions regarding wind integration
which are soon to be filed with the Commission.
II.
BACKGROUND
Idaho Power Company filed a petition with the Commission on June 17 , 2005, in Case
No. IPC-05-22 requesting that the Commission suspend its obligations under Sections 201 and
210 of the Public Utility Regulatory Policies Act (PURP A), to enter into new contracts to
purchase energy generated by wind powered Qualifying Facilities (QF's). On June 28 2005
Avista filed a "Petition and Comments , in which it requested that the Commission temporarily
suspend A vista s PURP A purchase obligations in the same manner as requested by Idaho Power
and also requested intervention in the docket. On July 1 , 2005, in Order No. 29815 , the
Commission granted A vista s intervention. A vista participated in the public hearing, and oral
argument, conducted before the Commission on August 4 2005.
Rather than te~porarily suspending wind power purchase obligations as requested by the
utilities, in Order No. 29839 issued on August 4, 2005 , the Commission reduced the published
rate eligibility cap for intermittent QF wind projects from 10 average MW per month to 100 kW
and required individual contract negotiations for QF's larger than 100 kilowatts. Subsequently,
in Order No. 29872, the Commission finalized prior orders in the docket and afforded parties the
opportunity to appeal. No appeals were filed from Order No. 29839. Therefore, the PURP A
rates, terms and conditions established in Order No. 29839 are final and may not be revised by
merely closing the docket as requested by Exergy.
ANSWER OF A VISTA CORPORA nON TO EXERGY
DEVELOPMENT GROUP OF IDAHO'S MOTION FOR
ORDER TO CLOSE THIS DOCKET AND REINSTATE
THE 10 MW THRESHOLD FOR P ACIFICORP AND
AVISTA - PAGE 2
III.
ARGUMENT
Exer2V Does Not Have Standine: To Initiate A Chane:e To Existine: PURPA Rate.
Exergy s motion is styled as a motion to close the docket and reinstate the 10 average
MW threshold for A vista and PacifiCorp. In actual legal effect, Exergy s pleading is a complaint
that asks the Commission to rescind, revise or amend existing PURP A rates applicable to
projects larger than 100 kW as established in Order No. 29839. Therefore, Exergy s pleading is
governed by Idaho Code, ~ 61-612 which provides, in part:
No complaints shall be entertained by the commission, except upon its own
motion, as to the reasonableness of any rate or charges of any gas, electric, coal
water or telephone corporation unless the same be signed by the mayor or the
president or chairman of the board of trustees or a majority of the counciL
commission or other legislative body of the city or county or city or town, if any,
within which the alleged violation occurred,or not less than 25 consumers or
purchasers or prospective consumers or purchasers of such gas, electricity, water
or telephone service.
(Emphasis added.) Exergy is not an officer of any city, county or town, and therefore does not
have standing under the statute to initiate a challenge to the reasonableness of existing PURP
rates.
Grantine: Exer2V s Motion Without An Opportunity For An Evidentiary Hearine:
Would Be Contrary To Law
Even if Exergy has standing to file its motion, granting Exergy s motion without an
opportunity for A vista to present evidence at hearing would fail the legal standard for rescinding,
altering or amending a prior order of the Commission. Idaho Code ~ 61-624 states that:
The commission at any time, upon notice to the public utility affected, and after
opportunity to be heard as provided in the case of complaints, rescind, alter or
amend any order or decision made by it.
ANSWER OF A VISTA CORPORATION TO EXERGY
DEVELOPMENT GROUP OF IDAHO'S MOTION FOR
ORDER TO CLOSE THIS DOCKET AND REINSTATE
THE 10 MW THRESHOLD FOR P ACIFICORP AND
AVISTA - PAGE 3
(Emphasis added.) Additionally, Idaho Code ~ 61-617 requires that
, "
(aJt a time fixed for
hearing before the commission, . . . the complainant and the corporation or person complained
, . . . shall be entitled to be heard to introduce evidence.
Absent adequate evidence, Exergy is not entitled to, and the Commission should not
issue, a new order that rescinds or revises Order No. 29839. The Supreme Court has stated:
. . .in regularly pursuing its authority the Commission must enter adequate
findings of fact based upon competent and substantial evidence. See Boise Water
Corp. v. Idaho Public Utilities Commission 97 Idaho 832, 555 P.2d 163 (1976);
Hartwig v. Pugh 97 Idaho 236, 542 P.2d 70 (1975). Thus "raln order based upon
a finding made without evidence. . . or upon a finding made upon evidence which
clearly does not support it . . . is an arbitrary act against which courts afford
relief.Oregon Shortline Railroad v. Public Utilities Commission 47 Idaho 482
484 276 P. 970, 971 (1929).
Washington Water Power v. P. Uc., 101 Idaho 567, 575 , 617 P. 1242 (1980) (emphasis added).
In this case, Exergy has tendered no evidence whatsoever to demonstrate that the
existing threshold for receiving published avoided cost rates from A vista is unreasonable or that
Exergy, or anyone else, is prejudiced by existing PURP A rates and policies. Absent a hearing at
which Exergy meets its evidentiary burden, Exergy s motion must be denied.
Exer2V Mischaracterizes Avista s Lee:al Standine: In This Docket
Exergy asserts that A vista never formally intervened in this docket. However, the record
reflects that the on June 30, 2005 , the very same date on which the Commission issued an order
granting Exergy s intervention in this matter, the Commission also issued Order No. 29815
granting Avista s motion to intervene. Since that date, Avista has fully participated in this
docket, including filing prepared testimony and a legal memorandum regarding suspension of
PURP A Mandatory Purchase Obligations.
ANSWER OF A VISTA CORPORA nON TO EXERGY
DEVELOPMENT GROUP OF IDAHO'S MOTION FOR
ORDER TO CLOSE THIS DOCKET AND REINSTATE
THE 10 MW THRESHOLD FOR P ACIFICORP AND
AVISTA - PAGE 4
Exer2V Misinterprets Order No. 29839 When It Allee:es That Avista Has Ie:nored
Mandates Imposed By The Commission
Exergy suggests that Order No. 29839 required Avista and PacifiCorp to conduct
workshops separate from those of Idaho Power. This is not the case. A vista complied with
Order No. 29839 by fully participating in the workshops hosted by Idaho Power. Moreover
Avista has also conducted its own independent wind integration study, the results of which it
expects to release in final form and file with the Commission by the end of March, 2007, or
shortly thereafter.
On January 31 , 2006, Idaho Power filed the "Phase II Workshop - Final Report " which
summarized the status of the workshops and informed the Commission of the lack of a consensus
among the participants at the final settlement conference. It would have been superfluous for
A vista to file reports that repeated the same information reported in Idaho Power s Final Report
or to host its own settlement conference, given the absence of consensus experienced at Idaho
Power s hosted events.
Moreover, in its Final Report, Idaho Power indicated its intention to complete an
Integration Study in 2006 and its further intention to provide periodic informal status reports to
interested persons. In Case No. IPC-07-, Idaho Power filed its study with the Commission.
Similarly, Avista initiated its own integration study nearly a year ago. In particular
A vista retained a leading industry consultant, EnerNex, to prepare a wind integration study, the
final report for which is expected to be delivered to A vista, soon. A vista has shared some
preliminary information from the draft final report for inclusion in the Phase I Report of the
Northwest Wind Integration Action Plan of the Bonneville Power Administration ("BP A") and
Northwest Power and Conservation Council ("NPCA"). Avista is currently reviewing EnerNex
ANSWER OF A VISTA CORPORA nON TO EXERGY
DEVELOPMENT GROUP OF IDAHO'S MOTION FOR
ORDER TO CLOSE THIS DOCKET AND REINSTATE
THE 10 MW THRESHOLD FOR P ACIFICORP AND
AVISTA - PAGE 5
draft final report, and by the end of March, 2007 or shortly thereafter, A vista expects to file the
final report and recommendations with the Commission.
Exergy is simply wrong in contending that A vista did not have a senous intent to
examine integration issues. Not only did it actively participate in the Idaho Power workshops, it
commissioned its own study of wind integration issues for the A vista system and participated in
regional forums regarding the subject. Rather than endeavoring to shut down wind development
as contended by Exergy, A vista has systematically analyzed wind integration issues in order to
develop recommendations to the Commission to facilitate the appropriate integration of wind
power into A vista s system.
If Exer2V s Motion Is Granted. Developers Would Have An Opportunistic And
Unneeded Window Of Opportunity To Sell Power Under the Published Avoided
Cost Rates
If the Commission grants Exergy s motion and increases the eligibility for published
avoided cost rates to 10 average MW, Avista could be required to purchase significant amounts
of wind energy under the published rates, before the Commission has even had the opportunity to
consider Avista s recommendations and the information contained in the EnerNex study. That
result would be contrary to the intention of Order No. 29839, which encouraged utilities to study
wind integration issues in the first place.
There is no need to depart from the policies established in Order No. 29839. Developers
of projects of all sizes remain entitled to long term PURP A contracts under Order 29839
because the order expressly permits purchases and sales at negotiated rates for projects larger
than 100 kW. Exergy does not allege, much less prove, that developers have sought, and have
been unable to obtain contracts from utilities at individually negotiated avoided cost rates.
ANSWER OF A VISTA CORPORATION TO EXERGY
DEVELOPMENT GROUP OF IDAHO'S MOnON FOR
ORDER TO CLOSE THIS DOCKET AND REINSTATE
THE 10 MW THRESHOLD FOR P ACIFICORP AND
AVISTA- PAGE 6
Nothing in Exergy s motion demonstrates any need to revise the PURP A rate structure currently
in effect, and the Commission should not consider any revisions at least until it has the
opportunity to fully consider A vista s integration study.
IV.
CONCLUSION
For the foregoing reasons, the Commission should deny Exergy s motion.
l' i.v-
RESPECTFULLY SUBMITTED this day of March, 2007
By:
By:
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R. Blair Strong
Attorneys for A vista Corporation
1:\Spodocs\11150\04145\plead\00489761.DOC
ANSWER OF A VISTA CORPORAnON TO EXERGY
DEVELOPMENT GROUP OF IDAHO'S MOnON FOR
ORDER TO CLOSE THIS DOCKET AND REINSTATE
THE 10 MW THRESHOLD FOR P ACIFICORP AND
AVISTA - PAGE 7
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on this 2 i-'day of March, 2007, I ca1,Jsed to be served a trueand correct copy of ANSWER OF AVISTA CORPORATION TO EXERGY
DEVELOPMENT GROUP OF IDAHO'S MOTION FOR ORDER TO CLOSE THIS
DOCKET AND REINSTATE THE 10 MW THRESHOLD FOR PACIFICORP AND
VISTA upon the following named parties by the method indicated below, and addressed to the
following:
Scott Woodbury
Deputy Attorney General
Idaho Public Utilities Commission
472 W. Washington Street
O. Box 83720
Boise, ill 83720-0074
Email: scott.woodburv~puc.Idaho.gov
Hand Delivered
u.S. Mail
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FAX [phone]
Mail
Peter J. Richardson
Richardson & O'Leary PLLC
515 N. 27th Street
O. Box 7218
Boise, ill 83707
Email: peteral),richardsonandolearv.com
James T. Carkulis
Exergy Development Group of Idaho LLC
1424 Dodge Avenue
O. Box 5212
Helena, MT 59604
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Mail
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Dean J. Miller
McDevitt & Miller LLP
420 W. Bannock Street
O. Box 2564
Boise, ill 83701
Email: ioe~mcdevitt-miller.com
Hand Delivered
~ U.S. Mail
Overnight Mail
FAX [phone]
Mail
Jared Grover
Cassia Wind LLC and Cassia Gulch Wind
Park LLC
3635 Kingswood Drive
Boise, ill 83704
Annand Eckert
Magic Wind LLC
716- BEast 4900 North
Buh!, ill 83316
Glenn Ikemoto
Energy Vision LLC
672 Balir Avenue
Piedmont, CA 94611
E-mail: glenni~pacbell.net
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ANSWER OF A VISTA CORPORATION TO EXERGY
DEVELOPMENT GROUP OF IDAHO'S MOTION FOR
ORDER TO CLOSE THIS DOCKET AND REINSTATE
THE 10 MW THRESHOLD FOR P ACIFICORP AND
AVISTA - PAGE 8
Bob Lively
PacifiCorp
One Utah Center, 23rd Floor
201 S. Main Street
Salt Lake City, UT 84140
E-mail: bob.lively~pacificoro.com
Lisa Nordstrom
PacifiCorp
825 N.E. Multnomah, Suite 1800
Portland, OR 97232
E-mail: lisa.nordstrom(CV,pacificoro.com
William M. Eddie
Advocates For the West
1320 W. Franklin Street
O. Box 1612
Boise, II) 83701
E-mail: billeddie(Q),nnici.net
Troy Gagliano
917 S.W. Oak Street, Suite 303
Portland, OR 972045
Mail: troy(CV,rnp.org
David Hawk, Director
Energy Natural Resources
R. Simplot Company
999 Main Street
O. Box 27
Boise, II) 83702
Mail: dhawk~simplot.com
R. Scott Pasley
Assistant General Counsel
R. Simp lot Company
999 Main Street
O. Box 27
Boise, II) 83702
Mail: spasley~simplot.com
William J. Batt
John R. Hammond, Jr.
Batt & Fisher, LLP
101 S. Capitol Blvd., Suite 500
O. Box 1308
Boise, II) 83701
Mail: wib(CV,battfisher.com
i rh~battfisher. com
Michael Heckler
Director of Marketing & Development
Windland Incorporated
7669 W. Riverside Drive, Suite 102
Boise, II) 83714
Mail: mheckler~windland.com
ANSWER OF A VISTA CORPORATION TO EXERGY
DEVELOPMENT GROUP OF IDAHO'S MOTION FOR
ORDER TO CLOSE THIS DOCKET AND REINSTATE
THE 10 MW THRESHOLD FOR P ACIFICORP AND
AVISTA - PAGE 9
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LeRoy Jarolimek
605 S. 600 W.
Burley, ill 83381
Email: leroviarolimek~hotmail.com
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CIerald Fleischman
11535 W. Hazeldale Ct.
Boise, ill 83713
Mail: gfleisch986(iV,hotmail.com
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Barton L. Kline
Monica B. Moen
Idaho Power Company
O. Box 70
Boise, ill 83707-0070
Mail: bkline(iV,idahopower.com
mmoen(iV,i dahopo w er. com
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R. Blair Strong
I:\Spodocs\I I 150\O414S\plead\OO48976I.DOC
ANSWER OF A VISTA CORPORAnON TO EXERGY
DEVELOPMENT GROUP OF IDAHO'S MOnON FOR
ORDER TO CLOSE THIS DOCKET AND REINSTATE
THE 10 MW THRESHOLD FOR P ACIFICORP AND
AVISTA-PAGE 10