20100309Application.pdf

Donovan E. Walker
Senior Counsel
dwalkertöidahopower.com
March 9, 2010
VIA HAND DELIVERY
Jean D. Jewell, Secretary
Idaho Public Utilties Commission
472 West Washington Street
P.O. Box 83720
Boise, Idaho 83720-0074
*5
IDA~POR~
(' r:"'_".1"..An IDACORP Company
II: 50
Re: Case No. IPC-E-10-05
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 RIVERSIDE INVESTMENTS LLC.
Dear Ms. Jewell:
Enclosed please find for filng an original and seven (7) copies of Idaho Power
Company's Application in the above matter.
DEW:sh
Enclosures
z;ff.'~l(cL
Donovan E. Walker
P.O. Box 70 (83707)
1221 W. Idaho St.
Boise, ID 83702
DONOVAN E. WALKER (ISB No. 5921)
BARTON KLINE (ISB No. 1526)
Idaho Power Company
P.O. Box 70
Boise, Idaho 83707
Telephone: [phone]
Facsimile: [phone]
dwalkerCâidahopower.com
bklineCâidahopower.com
20fO MAR -9 AM 11: 50
Attorneys for Idaho Power Company
Street Address for Express Mail:
1221 West Idaho Street
Boise, Idaho 83702
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MAnER 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 RIVERSIDE INVESTMENTS LLC.
)
) CASE NO. IPC-E-10-05
)
) APPLICATION
)
)
)
Idaho Power Company ("Idaho Power" or the "Company"), in accordance with
Idaho Code § 61-503 and RP 52 and the applicable provisions of the Public Utilty
Regulatory Policies Act of 1978 ("PURPA"), hereby respectfully applies to the Idaho
Public Utilties Commission ("I PUC" or the "Commission") for an Order approving the
Firm Energy Sales Agreement between Idaho Power and Riverside Investments LLC
("Riverside") under which Riverside would sell and Idaho Power would purchase electric
energy generated by the Arena Drop small hydro generation facilty ("Facilty") located
near Parma, Idaho.
In support of this Application Idaho Power represents as follows:
APPLICATION - 1
I. BACKGROUND
1. Sections 201 and 210 of PURPA, and pertinent regulations of the Federal
Energy Regulatory Commission ("FERC"), require that regulated electric utilties
purchase power produced by cogenerators or small power producers that obtain
qualifying facility ("QF") status. The purchase price a QF receives for the sale of its
power is generally referred to as the avoided cost rate and is computed to be equal to
the incremental cost to an electric utilty of electric energy or capacity or both, which, but
for the purchase from the QF, such utilty would generate itself or purchase from
another source. The Commission has authority under PURPA Sections 201 and 210
and the implementing regulations of the FERC, 18 C.F.R. § 292, to set avoided costs, to
order electric utilties to enter into fixed-term obligations for the purchase of energy from
QFs, and to implement FERC's PURPA rules.
II. THE FIRM ENERGY SALES AGREEMENT
2. On March 8, 2010, Idaho Power and Riverside entered into a Firm Energy
Sales Agreement ("Agreement") pursuant to the terms and conditions of the various
Commission Orders applicable to this PURPA agreement. See, Order Nos. 30415,
30488, 30738, and 30744. A copy of the Agreement is enclosed with this Application as
Attachment NO.1. Under the terms of the Agreement, Riverside elected to contract with
Idaho Power for a 20-year term. Riverside further elected to contract with the Company
using the Non Levelized Published Avoided Cost Rates as currently established by the
Commission for energy deliveries of less than 10 average megawatts ("MW").
APPLICATION - 2
3. The nameplate rating of this Facilty is 450 KW. As defined in paragraph
1.13 of the Agreement and as described in paragraph 4.1.3 of the Agreement, Riverside
will be required to provide data on the Facilty that Idaho Power wil use to confirm that
under normal and/or average conditions the Facilty wil not exceed 10 average MW on
a monthly basis. Furthermore, as described in paragraph 7.5 of the Agreement, should
the Facilty exceed 10 average MW on a monthly basis, Idaho Power wil accept the
energy ("Inadvertent Energy") that does not exceed the Maximum Capacity Amount, but
wil not purchase or pay for this Inadvertent Energy.
4. Riverside has elected an estimated Operation Date of July 15, 2010. If
the Facilty has not achieved its Operation Date prior to 90 days past that date, Delay
Liquidated Damages of $45 per Nameplate KW rating wil be assessed and collected
from the Facilty. In addition, as specified in paragraph 5.7 within 30 days of the date of
the Commission Order approving this Agreement Riverside shall post security of $45
per Nameplate KW rating.
5. Section 20 of the Agreement provides that the Agreement wil not become
effective unti the Commission has approved all of the Agreement's terms and
conditions and declared that all payments Idaho Power makes to Riverside for
purchases of energy wil be allowed as prudently incurred expenses for ratemaking
purposes.
6. Various requirements have been placed upon Riverside in order for Idaho
Power to accept energy deliveries from this Facility. Idaho Power wil monitor
compliance with these initial requirements. In addition, Idaho Power wil monitor the
ongoing requirements through the full term of this Agreement. Should the Commission
APPLICATION - 3
approve this Agreement, Idaho Power intends to consider the Effective Date of the
Agreement to be March 8, 2010.
7. The Agreement, as signed and submitted by the Parties thereto, contains
Non Levelized Published Avoided Cost Rates in conformity with applicable IPUC
Orders.
8. An interconnection feasibilty study was not required for this Facility. A
final Facility Study was completed on March 4, 2010. All applicable interconnection
charges and monthly operation and maintenance charges under Schedule 72 wil be
assessed and collected from Riverside.
II. MODIFIED PROCEDURE
9. Idaho Power believes that a hearing is not necessary to consider the
issues presented herein and respectfully requests that this Application be processed
under Modified Procedure, i.e., by written submissions rather than by hearing. RP 201,
et seq. If, however, the Commission determines that a technical hearing is required, the
Company stands ready to present its testimony and support the Application in such
hearing.
IV. COMMUNCIATIONS AND SERVICE OF PLEADINGS
10. Communications and service of pleadings, exhibits, orders, and other
documents relating to this proceeding should be sent to the following:
Donovan E. Walker, Senior Counsel
Barton L. Kline, Lead Counsel
Idaho Power Company
P.O. Box 70
Boise, Idaho 83707
Randy C. Allphin
Sr. Energy Contract Administrator
Idaho Power Company
P.O. Box 70
Boise, Idaho 83707
APPLICATION - 4
V. REQUEST FOR RELIEF
11. Idaho Power Company respectfully requests that the Commission issue
an Order: (1) authorizing that this matter may be processed by Modified Procedure; (2)
approving the Firm Energy Sales Agreement between Idaho Power Company and
Riverside Investments LLC without change or condition; and (3) declaring that all
payments for purchases of energy under the Firm Energy Sales Agreement between
Idaho Power Company and Riverside Investments LLC be allowed as prudently
incurred expenses for ratemaking purposes.
Respectfully submitted this 9th day of March 2010.
~?ø~
Donovan E. Walker
Attorney for Idaho Power Company
APPLICATION - 5
CERTIFICATE OF MAILING
I HEREBY CERTIFY that on the 9th day of March 2010 I served a true and
correct copy of the within and foregoing APPLICATION upon the following named
parties by the method indicated below, and addressed to the following:
Riverside Investments LLC
Attn: Dennis Daughert
POBox 154
Adrian, OR 97901
Hand Delivered
-l U.S. Mail
_ Overnight Mail
FAX
Email
~~~
Donovan E. Walker
APPLICATION - 6
BEFORE THE
IDAHO PUBLIC UTiliTIES COMMISSION
CASE NO. IPC-E-10-05
IDAHO POWER COMPANY
ATTACHMENT NO.1
Idaho Public Utility
Commission Copy
Please return this signed original to Idaho Power.
Aricle
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3
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5
6
7
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FIR ENERGY SALES AGREEMENT
BETWEEN
IDAHO POWER COMPANY
AN
RIVERSIDE INESTMENTS 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
Puchase Price and Method of Payment
Facility and Interconnection
Metering and Telemetry
Records
Operations
Indemnfication and Insurance
Force Majeure
Liability; Dedication
Several Obligations
Waiver
Choice of Laws and Venue
Disputes and Default
Governental Authorization
Commssion Order
Successors and Assigns
Modification
Taxes
Notices
Additional Ters and Conditions
Severability
Counterpars
Entire Agreement Signatures
Appendix A
AppendixB
Appendix C
AppendixD
FIR ENERGY SALES AGREEMENT
(10 aMW or Less)
Project Name: Arena Drop
Project Number: 21615205
THIS AGREEMENT, entered into on this gu day of J'4"' h 2010 between
RIERSIDE INESTMENTS LLC, an Idaho limited liabilty company (Seller), and IDAHO POWER
COMPAN, an Idaho corporation (Idaho Power), hereinafter sometimes referred to collectively as
"Paries" or individually as "Party."
WITNSSETH:
WHEREAS, Seller wil design, construct, own, maintain and operate an electric generation
facility; and
WHREAS, Seller wishes to sell, and Idaho Power is wiling to purchase, firm electric energy
produced by the Seller's Facility.
THEREFORE, In consideration of the mutual covenants and agreements hereinafter set forth, the
Paries 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 "Base Energy" - Monthly Net Energy less than 110% of the monthly Net Energy Amount as
specified in paragraph 6.2 of this Agreement.
1.2 "Commssion" - The Idaho Public Utilties Commssion.
1.3 "Contract Year" - The period commencing each calendar year on the same calendar date as the
Operation Date and ending 364 days thereafter.
1.4 "Delay Liquidated Damages" - Damages payable to Idaho Power as calculated in paragraph 5.3,
5.4,5.5,5.6 and 5.7.
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1.5 "Delay Period" - All days past the Scheduled Operation Date until the Seller's Facility achieves
the Operation Date.
1.6 "Delay Price" - The curent month's Mid-Columbia Market Energy Cost minus the current
month's All Hours Energy Price specified in paragraph 7.3 of this Agreement. If this calculation
results in a value less than 0, the result of this calculation wil be O.
1.7 "Designated Dispatch Facilty" - Idaho Power's Systems Operations Group, or any subsequent
group designated by Idaho Power.
1.8 "Facility" - That electric generation facility described in Appendix B of this Agreement.
1.9 "First Energy Date" - The day commencing at 00:01 hours, Mountain Time, following the day
that Seller has satisfied the requirements of Aricle IV and the Seller begins delivering energy to
Idao Power's system at the Point of Delivery.
1.10 "Heayy Load Hours" - The daily hours beginnng at 7:00 am, ending at 11 :00 pm Mountain
Time, (16 hours) excluding all hour on all Sundays, New Years Day, Memorial Day, Fourh of
July, Labor Day, Thansgiving and Chrstmas.
1.11 "Inadvertent Energy" - Electric energy Seller does not intend to generate. Inadvertent energy is
more particularly described in paragraph 7.5 of this Agreement.
1.12 "Interconnection Facilities" - All equipment specified in Schedule 72.
1.13 "Intial Capacity Determnation" - The process by which Idaho Power confirs that under
norml or average design conditions the Facilty wil generate at no more than 10 average MW
per month and is therefore eligible to be paid the published rates in accordance with Commssion
Order No. 29632.
1.14 "Light Load Hours" - The daily hours beginnng at 11 :00 pm, ending at 7:00 am Mountain Time
(8 hours), plus all other hours on all Sundays, New Years Day, Memorial Day, Fourh of July,
Labor Day, Thankgiving and Chrstmas.
1.15 "Losses" - The loss of electrical energy expressed in kilowatt hour (kWh) occurng as a result
of the transformation and transmission of energy between the point where the Facility's energy is
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metered and the point the Facility's energy is delivered to the Idaho Power electrical system. The
loss calculation formula wil be as specified in Appendix B of this Agreement.
1.16 "Market Energy Reference Price" - Eighty-five percent (85%) of the Mid-Columbia Market
Energy Cost.
1.17 "Material Breach" - A Default (paragraph 18.2.1) subject to paragraph 18.2.2.
1.18 "Maximum Capacity Amount" - The maximum capacity (MW) of the Facility wil be as
specified in Appendix B of this Agreement.
1.19 "Metering Equipment" - All equipment specified in Schedule 72, this Agreement and any
additional equipment specified in Appendix B required to measure, record and telemeter bi
directional power flows between the Seller's electric generation plant and Idaho Power's system.
1.20 "Mid- Columbia Market Energy Cost" - The monthly 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
wil mutually agree upon a replacement index, which is similar to the Dow Jones Mid-Columbia
Index. The selected replacement index wil be consistent with other similar agreements and a
commonly used index by the electrical industry.
1.21 "Nameplate Capacity" -The full-load electrical quantities assigned by the designer to a generator
and its prime mover or other piece of electrical equipment, such as transformers and circuit
breakers, under standardized conditions, expressed in amperes, ki10volt-amperers, kilowatts, volts
or other appropriate unts. Usually indicated on a nameplate attached to the individual machine
or device.
1.22 "Net Energy" - All of the electric energy produced by the Facility, less Station Use, less Losses,
expressed in kilowatt hours (kWh). Subject to the terms of this Agreement, Seller commts 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.
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1.23 "Operation Date" - The day commencing at 00:01 hours, Mountain Time, following the day that
all requirements of paragraph 5.2 have been completed.
1.24 "Point of Delivery" - The location specified in Appendix B, where Idaho Power's and the
Seller's electrical facilties are interconnected and the energy from this Facility is delivered to the
Idaho Power electrical system.
1.25 "Prudent Electrical Practices" - Those practices, methods and equipment that are commonly and
ordinarily used in electrical engineering and operations to operate electric equipment lawfuly,
safely, dependably, efficiently and economically.
1.26 "Scheduled Operation Date" - The date specified in Appendix B when Seller anticipates
achieving the Operation Date. It is expected that the Scheduled Operation Date provided by the
Seller shall be a reasonable estimate ofthe date that the Seller anticipates that the Seller's Facility
shall achieve the Operation Date.
1.27 "Schedule 72" - Idaho Power's Tarff No 101, Schedule 72 or its successor schedules as
approved by the Commssion. The Seller shall be responsible to pay all costs of interconnection
and integration of this Facility into the Idaho Power electrical system as specified within
Schedule 72.
1.28 "Season" - The three periods identified in paragraph 6.2.1 of this Agreement.
1.29 "Special Facilities" - Additions or alterations of transmission and/or distribution lines and
transformers as descnbed in Schedule 72.
1.30 "Station Use" - Electric energy that is used to operate equipment that is auxilar or otherwise
related to the production of electricity by the Facility.
1.31 "Surplus Energy" - Is (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 montWy Net Energy
Amount for the corresponding month specified in paragraph 6.2. or (2) If the Net Energy
produced by the Seller's Facilty and delivered to the Idaho Power electrical system durng the
month is less than 90% of the montWy Net Energy Amount for the corresponding month
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specified in paragraph 6.2, 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.
1.32 "Total Cost of the Facility" - The total cost of structures, equipment and appurenances.
ARTICLE II: NO RELIANCE ON IDAHO POWER
2.1 Seller Independent Investigation - Seller warrants and represents to Idaho Power that in entering
into this Agreement and the undertakng by Seller of the obligations set forth herein, Seller has
investigated and determned that it is capable of performg hereunder and has not relied upon
the advice, experience or expertise of Idaho Power in connection with the transactions
contemplated by this Agreement.
2.2 Seller Independent Experts - All professionals or experts including, but not limited to, engineers,
attorneys or accountants, that Seller may have consulted or relied on in underakg the
transactions contemplated by this Agreement have been solely those of Seller.
ARTICLE II: WARTIES
3.1 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 confirmtion by Idaho
Power and Idaho Power makes no waranties, expressed or implied, regarding any aspect of
Seller's design, specifications, equipment or facilties, including, but not limted to, safety,
durabilty, reliabilty, strength, capacity, adequacy or economic feasibility.
3.2 Qualifying Facilty Status - Seller warts that the Facility is a "Qualifyng Facilty," as that term
is used and defined in 18 CFR 292.201 et seq. After initial qualification, Seller wil take such
steps as may be required to maintain the Facilty's Qualifying Facility status during the term of
this Agreement and Seller's failure to maintain Qualifying Facility status wil be a Material
Breach of this Agreement. Idaho Power reserves the right to review the Facility's Qualifying
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Facility status and associated support and compliance documents at anytime during the term of
this Agreement.
3.3 FERC License (only applies to hydro projects) - Seller warants that Seller possesses a valid
license or exemption from licensing from the Federal Energy Regulatory Commssion ("FERC")
for the Facility. Seller recognzes that Seller's possession and retention of a valid FERC license
or exemption is a material part of the consideration for Idaho Power's execution of this
Agreement. Seller wil take such steps as may be required to maintain a valid FERC license or
exemption for the Facility durng the term of this Agreement, and Seller's failure to maintain a
valid FERC license or exemption wil be a material breach of this Agreement.
ARTICLE IV: CONDITIONS TO ACCEPTANCE OF ENERGY
4.1 Prior to the First Energy Date and as a condition ofIdaho Power's acceptance of deliveries of
energy from the Seller under this Agreement, Seller shall:
4.1.1 Submit proof to Idaho Power that all licenses, permts or approvals necessar for Seller's
operations have been obtained from applicable federal, state or local authorities,
including, but not limited to, evidence of compliance with Subpar B, 18 CFR 292.201 et
seq. as a certified Qualifying Facility.
4.1.2 Opinion of Counsel - Submit to Idaho Power an Opinion Letter signed by an attorney
admtted to practice and in good standing in the State of Idaho providing an
opinion that Seller's licenses, permts and approvals as set forth in paragraph 4.1.1
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 substatial
compliance with said permts as of the date of the Opinon Letter. The Opinion Letter
wil be in a form acceptable to Idaho Power and wil acknowledge that the attorney
rendering the opinion understands that Idao Power is relying on said opinion. Idaho
Power's acceptance of the form wil not be uneasonably withheld. The Opinion Letter
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wil be governed by and shall be interpreted in accordance with the legal opinion accord
of the American Bar Association Section of Business Law (1991).
4.1.3 Intial Capacity Determnation - Submit to Idaho Power such data as Idaho Power may
reasonably require to perform the Intial Capacity Determnation. Such data wil include
but not be limited to, Nameplate Capacity, equipment specifications, prime mover data,
resource characteristics, normal and/or average operating design conditions and Station
Use data. Upon receipt of this informtion, Idaho Power wil review the provided data
and if necessary, request additional data to complete the Intial Capacity Determnation
within a reasonable time.
4.1.3.1 If the Maximum Capacity specified in Appendix B of this Agreement and the
cumulative manufacture Nameplate Capacity rating of the individual generation
units at this Facility is less than 10 MW. The Seller shall submit detailed,
manufacturer, verifiable data of the Nameplate Capacity ratings of the actual
individual generation unts to be installed at this Facility. Upon verification by
Idaho Power that the data provided establishes the combined Nameplate Capacity
rating of the generation unts to be installed at this Facility is less than 10 MW, it
wil be deemed that the Seller has satisfied the Intial Capacity Deteration for
this Facility.
4.1.4 Nameplate Capacity - Submit to Idaho Power manufacturer's and engineerig
documentation that establishes the Nameplate Capacity of each individual generation unt
that is included withi this entire Facility. Upon receipt of this data, Idaho Power shall
review the provided data and determne if the Nameplate Capacity specified is reasonable
based upon the manufactuer's specified generation ratings for the specific generation
unts.
4.1.5 Engineer's Certifications - Submit an executed Engineer's Certification of Design &
Construction Adequacy and an Engieer's Certification of Operations and Maintenance
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(O&M) Policy as described in Commssion Order No. 21690. These certificates will be
in the form specified in Appendix C but may be modified to the extent necessar to
recognze the different engineering disciplines providing the certificates.
4.1.6 Insurance - Submit written proof to Idaho Power of all insurance required in Aricle Xli.
4.1.7 Interconnection - Provide written confirtion from Idaho Power's delivery business
unit that Seller has satisfied all interconnection requirements.
4.1.8 Network Resource Designation - The Seller's Facility has been designated as a network
resource capable of deliverig firm energy up to the amount of the Maximum Capacity.
4.1.9 Written Acceptance - Request and obtain written confirmtion 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 wil
not be unreasonably withheld by Idaho Power.
ARTICLE V: TERM AN OPERATION DATE
5.1 Ter - 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.
5.2 Operation Date - The Operation Date may occur only after the Facility has achieved all of the
following:
a) Achieved the First Energy Date.
b) Commssion 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 confiration from Idaho Power of the Operation Date.
This confirmtion wil not be uneasonably withheld by Idaho Power.
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5.3 Operation Date Delay - Seller shall cause the Facilty to achieve the Operation Date on or before the
Scheduled Operation Date. Delays in the interconnection and transmission network upgrade study,
design and construction process that are not Force Majeure events accepted by both Paries shall not
prevent Delay Damages being calculated as specified in this Agreement.
5.3.1 If the Operation Date occurs after the Scheduled Operation Date but on or prior to 90
days following the Scheduled Operation Date, Seller shall pay Idaho Power Delay
Liquidated Damages calculated at the end of each calenda month after the Scheduled
Operation Date as follows:
Delay Liquidated Damages are equal to ((Curent month's Intial Year Net
Energy Amount as specified in paragraph 6.2.1 divided by the number of days in
the curent month) multiplied by the number of days in the Delay Period in the
curent month) multiplied by the current month's Delay Price.
5.3.2 If the Operation Date does not occur within ninety (90) days following the Scheduled
Operation Date the Seller shall pay Idaho Power Delay Liquidated Damages, in addition
to those provided in paragraph 5.3.1, calculated as follows:
Forty five dollars ($45) multiplied by the Maximum Capacity with the Maximum
Capacity being measured in KW.
5.4 If Seller fails to achieve the Operation Date within ninety (90) days following the Scheduled
Operation Date, such failure wil be a Material Breach and Idaho Power may termate this
Agreement at any time until the Seller cures the Material Breach. Additional Delay Damages
beyond those calculated in 5.3.1 and 5.3.2 wil be calculated and payable using the Delay
Damage calculation described in 5.3.1 above for all days exceeding 90 days past the Scheduled
Operation Date until such time as the Seller cures this Material Breach or Idaho Power ternates
this Agreement.
5.5 Seller shall pay Idaho Power any calculated Delay Damages or Delay Liquidated Damges within
7 days of when Idaho Power calculates and presents any Delay Damages or Delay Liquidated
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Damages bilings to the Seller. Seller's failure to pay these damages withi the specified time
wil be a Material Breach of this Agreement and Idaho Power shall draw fuds from the Delay
Securty provided by the Seller in an amount equal to the calculated Delay Damges or Delay
Liquidated Damges.
5.6 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.
5.7 The Seller shall; 1) submit evidence acceptable to Idaho Power that the Seller has obtained a
favorable feasibility study report from the interconnection provider at the time the Seller executes
this Agreement and 2) within thirty (30) days of the date of a Commssion Order as specified in
Aricle XX approving this Agreement the Seller shall post liquid security ("Delay Security") in a
form as described in Appendix D equal to or exceeding the amount calculated in paragraph 5.7.1.
5.7.1 Delay Securty The greater of forty five ($45) multiplied by the Maximum Capacity with
the Maximum Capacity being measured in KW or the sum of three month's estimated
revenue. Where the estimated three months of revenue is the estimated revenue
associated with the first three full months following the estimated Scheduled Operation
Date, the estimated kWh of energy production as specified in paragraph 6.2.1 for those
three months multiplied by the All Hours Energy Price specified in paragraph 7.3 for
each of those three months.
5.7.1.1 In the event (a) Seller provides Idao Power with certification that (1) a
generation interconnection agreement specifying a schedule that wil enable this
Facility to achieve the Operation Date no later than the Scheduled Operation
Date has been completed and the Seller has paid all required interconnection
costs or (2) a generation interconnection agreement is substantially complete and
all material costs of interconnection have been identified and agreed upon and
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the Seller is in compliance with all term and conditions of the generation
interconnection agreement, the Delay Securty calculated in accordance with
paragraph 5.7.1 wil be reduced by ten percent (10%).
5.7.1.2 If the Seller has received a reduction in the calculated Delay Securty as specified
in paragraph 5.7.1.1 and subsequently (1) at Seller's request, the generation
interconnection agreement specified in paragraph 5.7.1.1 is revised and as a
result the Facility wil not achieve its Operation Date by the Scheduled Operation
Date or (2) if the Seller does not maintain compliance with the generation
interconnection agreement, the full amount of the Delay Securty as calculated in
paragraph 5.7.1 wil be subject to reinstatement and wil be due and owing withi
5 business days from the date Idaho Power requests reinstatement. Failure to
timely reinstate the Delay Securty wil be a Material Breach of this Agreement.
5.7.2 Idaho Power shall release any remaining securty posted hereunder after all calculated Delay
Damages and/or Delay Liquidated Damages are paid in full to Idaho Power and the ealier of (1)
30 days after the Operation Date has been achieved or (2) 60 days after the Agreement has been
termnated.
ARTICLE VI: PURCHASE AN SALE OF NET ENERGY
6.1 Delivery and Acceptance of Net Energy - Except when either Pary's performance is excused as
provided herein, Idaho Power wil purchase and Seller wil sell all of the Net Energy to Idaho
Power at the Point of Delivery. All Inadvertent Energy produced by the Facility wil also be
delivered by the Seller to Idaho Power at the Point of Delivery. At no time wil the total amount
of Net Energy and/or Inadvertent Energy produced by the Facility and delivered by the Seller to
the Point of Delivery exceed the Maximum Capacity Amount.
6.2 Net Energy Amounts - Seller intends to produce and deliver Net Energy in the following monthly
amounts:
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6.2.1 Intial Year Monthly Net Energy Amounts:
Month kWh
March 0
Season 1 April 0
May 100,000
July 260,000
August 240,000
Season 2 November 0
December 0
June 245,000
September 145,000
Season 3 October 25,000
Januar 0
Februar 0
6.2.2 Ongoing Monthly Net Energy Amounts - Seller shall initially provide Idaho Power with
one year of monthly generation estimates (Intial Year Monthly Net Energy Amounts)
and beginng at the end of month nine and every three months thereafter provide Idaho
Power with an additional three months of forward generation estimates beyond those
generation estimates previously provided. Ths information wil be provided to Idaho
Power by written notice in accordance with paragraph 24.1, 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 wil use the
most recent 3 months of the Intial Year Monthly Net Energy Amounts specified in
paragraph 6.2.1 for the next 3 months of monthly Net Energy amounts.
6.2.3 Seller's Adjustment of Net Energy Amount
6.2.3.1 No later than the Operation Date, by written notice given to Idaho Power in
accordance with paragraph 24.1, the Seller may revise all of the previously
provided Initial Year Monthly Net Energy Amounts.
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6.2.3.2 Beginnng with the end of the 9th month after the Operation Date and at the end
of every third month thereafter: (1) 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 accordace with pargraph 24.1, no later th
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 wil be deemed to be an election of no
change.
6.2.4 Idaho Power Adjustment of Net Energy Amount - If Idaho Power is excused from
accepting the Seller's Net Energy as specified in paragraph 11.2.1 or if the Seller declares
a Suspension of Energy Deliveries as specified in paragraph 11.3.1 and the Seller's
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 11.2.1 or 11.3.1 occurs will be reduced in accordance with
the following:
Where:
NEA Curent Month's Net Energy Amount (Paragraph 6.2)
SGU a.) IfIdaho Power is excused from accepting the Seller's Net
Energy as specified in paragraph 11.2.1 this value wil be
equal to the percentage of curailment as specified by
Idaho Power multiplied by the TGU as defined below.
b.) If the Seller declares a Suspension of Energy Deliveries as
specified in paragraph 11.3.1 this value wil be the sum of
the individual generation unts 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 ths
agreement.
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3/3/2010
RSH Actual hours the Facility's Net Energy deliveries were either
reduced or suspended under paragraph 11.2.1 or 11.3.1
TH Actual total hours in the curent month
Resulting formula being:
~~~~~:~gy = NEA _ (( ~~~ X NEA ) X (~~ ) )
Amount
This Adjusted Net Energy Amount wil be used in applicable Surlus 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.
6.3 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 (l0%) of the sum of the Intial Year Net
Energy Amounts as specified in paragraph 6.2 shall constitute an event of default.
ARTICLE VII: PURCHASE PRICE AN METHOD OF PAYMENT
7.1 Base Energy Heavy Load Purchase Price - For all Base Energy received durg Heavy Load
Hours, Idaho Power wil pay the non-1evelized energy price in accordace with Commssion
Order 30744, 30738 and adjusted in accordance with Commssion Order 30415 for Heavy Load
Hour Energy deliveries with seasonalization factors applied:
Season 1 - (73.50 %)Season 2 - (120.00 %)Season 3 - (100.00 %)
Year Mils/kWh Mils/kWh Mils/kWh
2010 57.98 94.67 78.89
2011 59.54 97.21 81.01
2012 61.22 99.95 83.29
2013 62.62 102.23 85.19
2014 64.05 104.57 87.14
2015 65.52 106.97 89.14
2016 67.10 109.55 91.29
2017 68.63 112.05 93.38
2018 70.29 114.77 95.64
2019 71.91 117.40 97.83
2020 73.56 120.10 100.08
2021 75.26 122.87 102.39
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2022 76.99 125.70 104.75
2023 78.78 128.61 107.18
2024 80.60 131.59 109.66
2025 82.47 134.65 112.21
2026 84.75 138.37 115.31
2027 87.10 142.21 118.51
2028 89.53 146.17 121.81
2029 92.03 150.25 125.21
2030 94.60 154.45 128.71
2031 96.69 157.85 131.55
7.2 Base Energy Light Load Puchase Price - For all Base Energy received durng Light Load Hours,
Idaho Power wil pay the non-1evelized energy price in accordance with Commssion Order
30744, 30738 and adjusted in accordance with Commssion Order 30415 for Light Load Hour
Energy deliveries with seasonalization factors applied:
Season 1 - (73.50 %)Season 2 - (120.00 %)Season 3 - (100.00 %)
Year Mils/kWh Mils/kWh Mils/kWh
2010 52.63 85.93 71.61
2011 54.19 88.47 73.73
2012 55.87 91.21 76.01
2013 57.27 93.49 77.91
2014 58.70 95.83 79.86
2015 60.17 98.23 81.86
2016 61.75 100.81 84.01
2017 63.28 103.32 86.10
2018 64.94 106.03 88.36
2019 66.56 108.66 90.55
2020 68.21 111.36 92.80
2021 69.90 114.13 95.11
2022 71.64 116.97 97.47
2023 73.42 119.88 99.90
2024 75.25 122.86 102.38
2025 77.12 125.91 104.93
2026 79.40 129.64 108.03
2027 81.75 133.48 111.23
2028 84.18 137.43 114.53
2029 86.68 141.51 117.93
2030 89.25 145.71 121.43
2031 91.33 149.12 124.27
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7.3 All Hours Energy Price - The price to be used in the calculation of the Surlus Energy Price and
Delay Damage Price shall be the non-1evelized energy price in accordance with Commssion
Order 30744 and 30738 with seasonalization factors applied:
Year
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
Season 1 - (73.50 %)
Mils/kWh
55.60
57.16
58.84
60.24
61.67
63.14
64.72
66.25
67.91
69.53
71.18
72.87
74.61
76.39
78.22
80.09
82.37
84.72
87.15
89.64
92.22
94.30
Season 2 - (120.00 %)
MilslkWh
90.78
93.32
96.06
98.34
100.68
103.08
105.66
108.17
110.88
113.51
116.21
118.98
121.82
124.72
127.71
130.76
134.49
138.32
142.28
146.36
150.56
153.97
Season 3 - (100.00 %)
MilslkWh
75.65
77.77
80.05
81.95
83.90
85.90
88.05
90.14
92.40
94.59
96.84
99.15
101.51
103.94
106.42
108.97
112.07
115.27
118.57
121.97
125.47
128.31
7.4 Surlus Energy Price - For all Surlus Energy, Idaho Power shall pay to the Seller the curent
month's Market Energy Reference Price or the All Hours Energy Price specified in paragrph
7.3, whichever is lower.
7.5 Inadvertent Energy -
7.5.1 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.
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(For example Januar contains 744 hours. 744 hours times 10,000 kW = 7,440,000
kWh. Energy delivered in Januar in excess of 7,440, 000 kWh in this example
would be Inadvertent Energy.)
7.5.2 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 wil accept Inadvertent Energy that does not exceed the Maximum Capacity
Amount but wil not purchase or pay for Inadvertent Energy.
7.6 Payment Due Date - Energy payments, less any payments due to Idaho Power wil be disbursed
to the Seller within 30 days of the date which Idaho Power receives and accepts the
documentation of the monthly Net Energy actually delivered to Idaho Power as specified in
Appendix A.
7.7 Continuing Jursdiction of the Commssion _ This Agreement is a special contract and, as such, the
rates, terms and conditions contained in this Agreement wil be construed in accordace with
Idaho Power Company v. Idaho Public Utilties Commssion and Afon Energy, Inc., 107 Idaho
781, 693 P.2d 427 (1984), Idaho Power Company v. Idaho Public Utilties Commssion, 107
Idaho 1122, 695 P.2d 1 261 (1985), Afon Energy, Inc, v. Idaho Power Company, 111 Idaho 925,
729 P.2d 400 (1986), Section 210 of the Public Utilities Regulatory Policies Act of 1978 and 18
CFR §292.303-308
ARTICLE VII: FACILITY AN INTERCONNCTION
8.1 Design of Facility - Seller wil 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.
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ARTICLE IX: METERIG AN TELEMETRY
9.1 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 at the Point of Delivery.
The Metering Equipment wil 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 X - RECORDS
10.1 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
and maximum generation (kW) records in a form and content recmmended by Idaho Power.
10.2 Inspection - Either Party, after reasonable notice to the other Pary, shall have the right, durng
norml 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 Facilty.
ARTICLE XI: OPERATIONS
11.1 Communications - Idaho Power and the Seller shall maintain appropriate operating
communcations through Idaho Power's Designated Dispatch Facility in accordance with
Appendix A of this Agreement.
11.2 Energy Acceptance -
11.2.1 Idaho Power shall be excused from accepting and paying for Net Energy or accepting
Inadvertent Energy which would have otherwise been produced by the Facilty 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
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Schedule 72. If, for reasons other than an event of Force Majeure, a temporary
disconnection under Schedule 72 exceeds twenty (20) days, beginng with the twenty-
first day of such interrption, curailment or reduction, Seller wil 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 6.2. Idaho Power wil notify Seller when
the interrption, curailment or reduction is termnated.
11.2.2 If, in the reasonable opinon of Idaho Power, Seller's operation of the Facility or
Interconnection Facilities is unsafe or may otherwise adversely affect Idaho Power's
equipment, personnel or service to its customers, Idaho Power may temporarly
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.
11.2.3 If Idaho Power is unable to accept the energy from this Facility and is not excused from
accepting the Facility's energy, Idaho Power's damages shall be limited to only the value
of the estimated energy that Idaho Power was unable to accept. Idaho Power wil have
no responsibility to pay for any other costs, lost revenue or consequential daages. the
Facility may incur.
11.3 Seller Declared Suspension of Energy Deliveries
11.3.1 If the Seller's Facilty 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 11.3.2 below, temporarily suspend all deliveries of Net Energy to
Idaho Power from the Facility or from individual generation unt(s) withi the Facility
impacted by the forced outage for a perod 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 wil begin at the start of the next full hour following the
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Seller's telephone notification as specified in paragraph 11.3.2 and wil 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 occured, the Net
Energy Amount wil be adjusted as specified in paragraph 6.2.4.
11.3.2 If the Seller desires to intiate a Declared Suspension of Energy Deliveries as provided in
paragraph 11.3.1, the Seller wil notify the Designated Dispatch Facility by telephone.
The beginning hour of the Declared Suspension of Energy Deliveries wil be at the
earliest the next full hour after making telephone contact with Idaho Power. The Seller
wil, within 24 hours after the telephone contact, provide Idaho Power a wrtten notice in
accordance with XXIV that wil contain the beginng 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 wil review the
documentation provided by the Seller to determne Idaho Power's acceptance of the
described forced outage as qualifyng for a Declared Suspension of Energy Deliveries as
specified in paragraph 11.3.1. Idaho Power's acceptance of the Seller's forced outage as
an acceptable forced outage wil 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.
11.4 Scheduled Maintenance - On or before Januar 31 of each calendar year, Seller shall submit a
written proposed maintenance schedule of signficant Facility maintenance for that calendar year
and Idaho Power and Seller shall mutually agree as to the acceptability of the proposed schedule.
The Paries determnation as to the acceptabilty of the Seller's timetable for scheduled
maintenance wil take into consideration Prudent Electrical Practices, Idaho Power system
requirements and the Seller's preferred schedule. Neither Pary shall uneasonably withhold
acceptance of the proposed maintenance schedule.
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11.5 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.
11.6 Contact Prior to Curailment - Idaho Power wil make a reasonable attempt to contact the Seller
prior to exercising its rights to interrpt interconnection or curail deliveries from the Seller's
Facilty. Seller understands that in the case of emergency circumtances, real time operations of
the electrical system, and/or unplaned events Idaho Power may not be able to provide notice to
the Seller prior to interrption, curailment, or reduction of electrical energy deliveries to Idao
Power.
ARTICLE XII: INEMNIFICATION AN INSURCE
12.1 Indemnfication - Each Pary shall agree to hold haress and to indemnfy the other Pary, its
officers, agents, affiliates, subsidiares, parent company and employees against all loss, daage,
expense and liabilty to thid persons for injur to or death of person or injur to property,
proximately caused by the indemnfying Pary's (a) construction, ownership, operation or
maintenance of, or by failure of, any of such Party's works or facilities used in connection with
this Agreement or (b) negligent or intentional acts, erors or omissions. The indemnfying Pary
shall, on the other Pary's request, defend any suit asserting a claim covered by this indemnty.
The indemnfyng Party shall pay all documented costs, including reasonable attorney fees that
may be incured by the other Party in enforcing this indemnty.
12.2 Insurance - Durng the term of this Agreement, Seller shall secure and continuously car the
following insurance coverage:
12.2.1 Comprehensive General Liability Insurance for both bodily injury and propery damage
with limits equal to $1,000,000, each occurence, combined single limit. The deductible
for such insurance shall be consistent with curent Inurance Industry Utilty practices for
similar property.
12.2.2 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:
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3/3/2010
(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 wrtten notice to Idaho Power.
12.3 Seller to Provide Certificate of Insurance - As required in paragraph 4.1.5 herein and annually
thereafter, Seller shall fush Idaho Power a certificate of insurance, together with the
endorsements required therein, evidencing the coverage as set forth above.
12.4 Seller to Notify Idaho Power of Loss of Coverage - If the insurance coverage required by
paragraph 12.2 shall lapse for any reason, Seller wil imediately notify Idaho Power in writing.
The notice wil 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 reintate or
replace the coverage wil constitute a Material Breach of this Agreement.
ARTICLE XII: FORCE MAJEUR
13.1 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 Pary is unable to prevent or overcome. Force Majeure includes, but is not limted to, acts of
God, fire, flood, storms, wars, hostilities, civil strife, stries and other labor disturbances,
earhquakes, fires, lightning, epidemics, sabotage, or changes in law or regulation occurng after
the effective date, which, by the exercise of reasonable foresight such pary 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 Paries shall be excused from whatever
performance is affected by the event of Force Majeure, provided that:
(1) The non-performng 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 occurence.
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3/3/2010
(2) The suspension of performance 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 occurence 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
occurence.
ARTICLE XIV: LIAILITY; DEDICATION
14.1 Limitation of Liability. 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.
Neither pary shall be liable to the other for any indirect, special, consequential, nor punitive
daages, except as expressly authorized by this Agreement. Consequential damges wil
include, but not be limted to, the value of renewable energy credits and, if the Facility is fueled
by gas produced by an anaerobic digester system, any dimnution or loss of anaerobic activity due
to the inability ofIdaho Power to accept energy from the Facility.
14.2 Dedication. No undertaking by one Part to the other under any provision of this Agreement
shall constitute the dedication ofthat Pary's system or any portion thereof to the Party or the
public or affect the status of Idaho Power as an independent public utility corporation or Seller as
an independent individual or entity.
ARTICLE XV: SEVERA OBLIGATIONS
15.1 Except where specifically stated in this Agreement to be otherwise, the duties, obligations and
liabilties of the Paries are intended to be several and not joint or collective. Nothing contained
in this Agreement shall ever be construed to create an association, trst, parnership or joint
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ventue or impose a trust or partnership duty, obligation or liability on or with regard to either
Party. Each Pary shall be individually and severally liable for its own obligations under this
Agreement.
ARTICLE XVI: WAIER
16.1 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 XVII: CHOICE OF LAWS AN VENU
17.1 This Agreement shall be construed and interpreted in accordace with the laws of the State of
Idaho without reference to its choice of law provisions.
17 .2 Venue for any litigation arising out of or related to this Agreement wil lie in the District Cour of
the Fourh Judicial District ofIdaho in and for the County of Ada.
ARTICLE XVil: DISPUTES AN DEFAULT
18.1 Disputes - All disputes related to or arising under this Agreement, including, but not limited to,
the interpretation of the term and conditions of this Agreement, wil be submitted to the
Commssion for resolution.
18.2 Notice of Default
18.2.1 Defaults. If either Party fails to perform any of the term or conditions of this
Agreement (an "event of default"), the nondefaulting Pary shall cause notice in
writing to be given to the defaulting Party, specifyng the maer in which such
default occured. If the defaulting Pary shall fail to cure such default within the sixty
(60) days after servce of such notice, or if the defaulting Pary reasonably
demonstrates to the other Party that the default can be cured withi a commercially
reasonable time but not within such sixty (60) day period and then fails to diligently
pursue such cure, then, the nondefaulting Pary may, at its option, termate this
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Agreement and/or pursue its legal or equitable remedies.
18.2.2 Material Breaches - The notice and cure provisions in paragraph 18.2.1 do not apply
to defaults identified in this Agreement as Material Breaches. Material Breaches must
be cured as expeditiously as possible following occurence of the breach.
18.3 Securty for Pedormance - Prior to the Operation Date and thereafter for the full ter of this
Agreement, Seller wil provide Idaho Power with the following:
18.3.1 Insurance - Evidence of compliance with the provisions of paragraph 12.2. If Seller
fails to comply, such failure wil be a Material Breach and may only be cured by
Seller supplying evidence that the required insurnce coverage has been replaced or
reinstated;
18.3.2 Engineer's Certifications - Every three (3) years after the Operation Date, Seller wil
supply Idaho Power with a Certification of Ongoing Operations and Maintence
(O&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's
failure to supply the requied cerificate wil be an event of default. Such a default
may only be cured by Seller providing the required certificate; and
18.3.3 Licenses and Permts - During the full term of this Agreement, Seller shall maintain
compliance with all permts and licenses described in paragraph 4.1.1 of this
Agreement. In addition, Seller wil supply Idaho Power with copies of any new or
additional permts or licenses. At least every fifth Contract Year, Seller wil update the
documentation described in Paragraph 4.1.1. If at any time Seller fails to maintain
compliance with the permts and licenses described in paragraph 4.1.1 or to provide
the documentation required by this paragraph, such failure wil be an event of default
and may only be cured by Seller submitting to Idaho Power evidence of compliance
from the permtting agency.
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3/3/2010
ARTICLE XIX: GOVERNENTAL AUTHORIATION
19.1 This Agreement is subject to the jursdiction of those governental agencies having control over
either Pary of this Agreement.
ARTICLE XX: COMMISSION ORDER
20.1 This Agreement shall become finally effective upon the Commssion's approval of all term and
provisions hereof without change or condition and declaration that all payments to be made to
Seller hereunder shall be allowed as prudently incured expenses for ratemaking purposes.
ARTICLE XXI: SUCCESSORS AN ASSIGNS
21.1 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 Paries hereto, except that no assignent
hereof by either Pary shall become effective without the written consent of both Parties being
first obtained. Such consent shall not be uneasonably 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 ofIdaho 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 XXII: MODIFICATION
22.1 No modification to this Agreement shall be valid uness it is in writing and signed by both Parties
and subsequently approved by the Commssion.
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ARTICLE XXII: TAXES
23.1 Each Pary shall pay before delinquency all taxes and other governental charges which, if failed
to be paid when due, could result in a lien upon the Facility or the Interconnection Facilities.
ARTICLE XXIV: NOTICES
24.1 All written notices under this Agreement shall be directed as follows and shall be
considered delivered when faxed, e-mailed and confirmed with deposit in the U.S. Mail,
first-class, postage prepaid, as follows:
To Seller:
Original document to:
Riverside Investments LLC
Attn: Dens Daugherty
POBox 154
Adran, Oregon 97901
Telephone:
Cell:
FAX:
[phone]
[phone]
[phone]
E-mail: denns~rsicorp.net
To Idaho Power:
Original document to:
Vice President, Power Supply
Idaho Power Company
POBox 70
Boise, Idaho 83707
Email: LGgrow~idahopower.com
Copy of document to:
Cogeneration and Small Power Production
Idaho Power Company
POBox 70
Boise, Idaho 83707
E-mail: rallphin(gidaopower.com
Either Pary may change the contact person and/or address information listed above, by providing written
notice from an authorized person representing the Party.
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ARTICLE XXV: ADDITIONAL TERMS AN CONDITIONS
25.1 This Agreement includes the following appendices, which are attached hereto and included by
reference:
Appendix A
AppendixB
AppendixC
AppendixD
Generation Scheduling and Reporting
Facility and Point of Delivery
Engineer's Cerifications
Form of Liquid Securty
ARTICLE XXVI: SEVERABILITY
26.1 The invalidity or unenforceability of any term or provision of this Agreement shall not affect the
validity or enforceabilty of any other ter or provisions and this Agreement shall be construed
in all other respects as if the invalid or unenforceable term or provision were omitted.
ARTICLE XXVII: COUNTERPARTS
27.1 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 instruent.
ARTICLE XXVil: ENTIR AGREEMENT
28.1 This Agreement constitutes the entire Agreement of the Parties concerng the subject matter
hereof and supersedes all prior or contemporaneous oral or wrtten agreements between the
Parties concernng the subject matter hereof.
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IN WITNSS WHEREOF, The Parties hereto have caused this Agreement to be executed
in their respective names on the dates set forth below:
By
Dated
Idaho Power Company Riverside Investments, LLC.
Lisa A Grow
Sr. Vice President, Power Supply
By
3'~'JO Dated wAc)
"Seller""Idaho Power"
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3/3/2010
APPENDIX A
A -1 MONTHLY POWER PRODUCTION AN SWITCHING REPORT
At the end of each month the following requied documentation wil be submitted to:
Idaho Power Company
Attn: Cogeneration and Small Power Production
POBox 70
Boise, Idaho 83707
The meter readings required on this report wil be the readings on the Idaho Power Meter Equipment
measurng the Facility's total energy production and Station Usage delivered to Idaho Power and the
maximum generated energy (kW) as recorded on the Meterng Equipment and/or any other required
energy measurements to adequately administer this Agreement. This document shall be the document to
enable Idaho Power to begin the energy payment calculation and payment process. The meter readings
on this report shall not be used to calculate the actual payment, but instead wil be a check of the
automated meter reading information that wil be gathered as described in item A-2 below:
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Idaho Power Company
Cogeneration and Small Power Producton
MONTHLY POWER PRODUCTION AND SWITCHIG REPORT
Project Name
Month Year
Project Number:
Address Phone Number:
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 Facilty
Disturbance of IPCo System
Scheduled Maintenance
Testing of Protection Systems
Cause Unknown
Other (Explain)
1
2
3
4
5
6
7
State Zip
Facilty
Output
Station
Usage
Station
Usage
Metered
Maximum Generation
kW
Net Generation
Breaker Closing Record
*i Reason
I
Date Time Meter
I hereby certify that the above meter readigs are
true and correct as of Midnight on the last day ofthe
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 Date
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A-2 AUTOMATED METER READING COLLECTION PROCESS
Monthly, Idaho Power wil use the provided Metering and Telemetry equipment and processes to collect
the meter reading information from the Idaho Power provided Metering Equipment that measures the Net
Energy and energy delivered to supply Station Use for the Facility recorded at 12:00 AM (Midnght) of
the last day of the month..
The meter inormation collected wil include but not be limited to energy production, Station Use, the
maximum generated power (kW) and any other required energy measurements to adequately administer
this Agreement.
A-3 ROUTIN REPORTING
Once the Facility has achieved its Operation Date and has operated in a reliable and consistent
maer for a reasonable period of time, the Paries may mutually agree to modify this Routine
Reporting requirement.
Idaho Power Contact Informtion
Daily Energy Production Reporting
Call daily by 10 a.m., 1-800-356-4328 or 1-800-635-1093 and leave the following
information:
· Project Identification - Project Name and Project Number
· Curent Meter Reading
· Estimated Generation for the curent day
· Estimated Generation for the next day
Planed and Unplaned Project outages
Call 1-800-345-1319 and leave the following informtion:
· Project Identification - Project Name and Project Number
· Approximate time outage occured
· Estimated day and time ofproject coming back online
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Seller's Contact Information
24-Hour Project Operational Contact
Name:
Telephone Number:
Cell Phone:
Denns Daugherty
[phone]
[phone]
Project On-site Contact information
Name:
Telephone Number:
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APPENDIXB
FACILITY AN POINT OF DELIVERY
Project Name: Arena Drop
Project Number: 21615205
B-1 DESCRITION OF FACILITY
(Must include the Nameplate Capacity rating and VAR capabilty (both leading and lagging) of all
generation units to be included in the Facilty.)
Horizontal Francis on Synchronous generator rated at 450 kw
Var Capabilty (Both leading and lagging) 15% SF PF.95 plus
B-2 LOCATION OF FACILITY
Near: Near Stephan Lane
Sections: ~ Township: 4N Range: 5W County: Canyon ID.
Description of Interconnection Location: PRMA-042-16
Nearest Idaho Power Substation:
B-3 SCHEDULED FIRST ENERGY AN OPERATION DATE
Seller has selected June 30, 2010 as the Scheduled First Energy Date.
Seller has selected July 15, 2010 as the Scheduled Operation Date.
In making these selections, Seller recognzes 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.
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B-4 MAXIMUM CAPACITY AMOUNT: This value will be .52 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
Power electrical system at any moment in time.
B-5 POINT OF DELIVERY
"Point of Delivery" means, unless otherwise agreed by both Paries, the point of where the Sellers
Facility's energy is delivered to the Idaho Power electrical system. Schedule 72 wil determe
the specific Point of Delivery for this Facility. The Point of Delivery identified by Schedule 72
wil become an integral part of this Agreement.
B-6 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 wil 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 wil
be established to measure the energy losses (kWh) between the Seller's Facility and the Idaho
Power Point of Delivery. This loss calculation wil 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 wil confgue a revised loss calculation formula to
be agreed to by both paries and used to calculate the kWh Losses for the remaining term of the
Agreement. If at any time durng the term of this Agreement, Idaho Power determes that the
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loss calculation does not correctly reflect the actual kWh losses attributed to the electrical
equipment between the Facility and the Idaho Power electrical system, Idao Power may adjust
the calculation and retroactively adjust the previous months kWh loss calculations.
B-7 METERIG AN TELEMETRY
Schedule 72 wil determne the specific meterig and telemetry requirements for this Facility. At
the minium the Meterig 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 admster this Agreement. These specifications wil include but not be limted 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 wil arrange for and make available at Seller's cost
communication circuit(s) compatible with Idaho Power's communcations equipment and
dedicated to Idaho Power's use termnating at the Idaho Power facilties capable of providing
Idaho Power with continuous instantaneous information on the Facilities energy production.
Idaho Power provided equipment wil be owned and maintained by Idaho Power, with total cost
of purchase, installation, operation, and maintenance, including admnistrative cost to be
reimbursed to Idao Power by the Seller. Payment of these costs wil be in accordace with
Schedule 72 and the total metering cost wil be included in the calculation of the Monthly
Operation and Maintenance Charges specified in Schedule 72.
B-8 NETWORK RESOURCE DESIGNATION AN TRASMISSION SERVICE REQUEST
Idaho Power cannot accept or pay for generation from this Facility until a Tranmission Service
Request ("TSR") and/or a Network Resource Designation ("NR") application have been
accepted by Idaho Power's delivery business unt. Federal Energy Regulatory Commssion
("FERC") Rules require Idaho Power to prepare and submit the TSR and/or NR. Because much
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of the informtion Idaho Power needs to prepare the TSR and NR is specific to the Seller's
Facility, Idaho Power's ability to file the TSR and NR in a timely maer is contingent upon
timely receipt ofthe required information from the Seller. Prior to Idaho Power submitting the
TSR and/or NR for this Facility, the Seller shall be required to execute an agreement with Idaho
Power requesting Idaho Power to complete and submit the TSR and/or NR application. Withi
this agreement the Seller shall take responsibilty for all costs incured by Idao Power in
preparing and submitting these applications. Seller's failure to provide complete and accurate
information in a timely manner can delay the First Energy Date and may result in Seller
paying higher costs for interconnection.
i.) Transmission Service Request (TSR)- Idaho Power wil prepare and submit the
TSR withi a reasonable perod of time after the Seller (a) has executed an
agreement with Idaho Power requesting Idaho Power submit a TSR application
and (b) provides written confiration that the Generation Interconnection
Agreement ("GIA") between Seller and Idaho Power's delivery business unt has
been executed for this Facilty and (c) provides all of the Facility-specific details
required to complete the TSR.
ii.) Network Resource Designtion - Idaho Power wil complete and file the NR
application within a reasonable period of time after (a) Seller has executed an
agreement with Idaho Power requesting Idaho Power submit a NR application
and (b) this Agreement has been executed by both paries and(c) the TSR (if
required) has been fied and accepted and (d) all necessar information has been
received from the Seller to enable Idaho Power to complete the NR application.
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APPENDIXC
ENGINER'S CERTIFICATION
OF
OPERATIONS & MAIENANCE POLICY
The undersigned , on behalf of himself and
hereinafter collectively referred to as "Engineer," hereby states and certifies to the Seller as follows:
1. That Engineer is a Licensed Professional Engineer in good standing in the State ofIdao.
2. That Engineer has reviewed the Energy Sales Agreement, hereinafter "Agreement," between
Idaho Power as Buyer, and as Seller, dated
3. That the cogeneration or small power production project which is the subject of the Agreement
and this Statement is identified as IPCo Facilty No.
the "Project."
4. That the Project, which is commonly known as the Project, is located in
Section _ Township Range , Boise Meridian, County, Idaho.
5. That Engineer recognzes that the Agreement provides for the Project to fush electrical energy
to Idaho Power for a year perod.
6. That Engineer has substantial experience in the design, construction and operation of electric
power plants of the same type as this Proj ect.
7. That Engineer has no economic relationship to the Design Engineer of this Project.
8. That Engineer has reviewed and/or supervsed 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 wil result in the
Project's producing at or near the design electrical output, efficiency and plant factor for a twenty (20)
year period.
and is hereinafter referred to as
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9. That Engineer recognzes that Idaho Power, in accordace 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.
By
(P .E. Stamp)
Date
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APPENDIXC
ENGINEER'S CERTIFICATION
OF
ONGOING OPERATIONS AN MAINTENANCE
The undersigned , on behalf of hiself and
hereinafter collectively referred to as "Engineer," hereby states and
certifies to the Seller as follows:
1. That Engineer is a Licensed Professional Engieer in good standig in the State of Idaho.
2. That Engineer has reviewed the Energy Sales Agreement, hereinafter "Agreement," between
Idaho Power as Buyer, and as Seller, dated
3. 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".
4. That the Project, which is commonly known as the Project, is located in
Section _ Township Range , Boise Meridian, County, Idao.
5. That Engineer recognzes that the Agreement provides for the Project to fush electrical energy
to Idaho Power for a year period.
6. That Engineer has substantial experience in the design, construction and operation of electric
power plants of the same type as this Project.
7. That Engineer has no economic relationship to the Design Engineer of this Project.
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8. 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 wil continue producing at or near its design electrical output, effciency and plant factor for the
remaining years of the Agreement.
9. That Engineer recognzes that Idaho Power, in accordace 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, tre and accurate to the best of his
knowledge and therefore sets his hand and seal below.
By
(P .E. Stamp)
Date
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APPENDIXC
ENGINER'S CERTIFICATION
OF
DESIGN & CONSTRUCTION ADEQUACY
The undersigned on behalf of himself and
hereinafter collectively referred to as "Engineer", hereby states and
certifies to Idaho Power as follows:
1.
2.
That Engineer is a Licensed Professional Engineer in good standing in the State of Idaho.
That Engineer has reviewed the Fir Energy Sales Agreement, hereinafter "Agreement",
between Idaho Power as Buyer, and as Seller, dated ~
3. 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".
4. That the Project, which is commonly known as the Project, is located in
Section _ Township Range , Boise Meridian, County, Idaho.
5. That Engineer recognzes that the Agreement provides for the Project to fush electrcal
energy to Idaho Power for a year period.
6.That Engieer has substantial experience in the design, construction and operation of
electric power plants of the same type as this Project.
7. That Engineer has no economic relationship to the Design Engieer of this Project and
has made the analysis of the plans and specifications independently.
8. That Engineer has reviewed the engineering design and construction of the Project,
including the civil work, electrcal work, generating equipment, prime mover conveyance system, Seller
fushed Interconnection Facilities and other Project facilities and equipment.
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9. That the Project has been constructed in accordance with said plans and specifications, all
applicable codes and consistent with Prudent Electrcal 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 perormg in accordance with the
term of the Agreement and with Prudent Electrical Practices for a twenty (20) year period.
11.That Engineer recognzes 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.
By
(P .E. Stamp)
Date
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APPENDIXD
FORMS OF LIQUID SECURTY
The Seller shall provide Idaho Power with commercially reasonable securty instruents such as
Cash Escrow Security, Guarantee or Letter of Credit as those terms are defied below or other
forms of liquid financial security that would provide readily available cash to Idaho Power to
satisfy the Delay Security requirement within this Agreement.
For the purpose ofthis Appendix D, the term "Credit Requirements" shall mean acceptable
financial creditworthiess of the entity providing the securty instruent in relation to the term of
the obligation in the reasonable judgment of Idaho Power, provided that any guarantee and/or
letter of credit issued by any other entity with a short-term or long-term investment grade credit
rating by Standard & Poor's Corporation or Moody's Investor Services, Inc. shall be deemed to
have acceptable financial creditwortness.
1. Cash Escrow Security - Seller shall deposit fuds in an escrow account established by the
Seller in a bang institution acceptable to both Parties equal to the Delay Securty.
2. Guarantee or Letter of Credit Security - Seller shall post and maintain in an amount
equal to the Delay Securty: (a) a guaranty from a pary that satisfies the Credit
Requirements, in a form acceptable to Idaho Power at its discretion, or (b) a Letter of
Credit in a form acceptable to Idaho Power, in favor of Idaho Power. The Letter of
Credit wil be issued by a financial institution acceptable to both parties.
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