20100909Application.pdf

RECE
1SIEM~POR~
An IDACORP Company
DONOVAN E. WALKER
Senior Counsel
dwalkerl&idahopower.com
1.~ 48
September 8, 2010
VIA HAND DELIVERY
Jean D. Jewell, Secretary
Idaho Public Utilities Commission
472 West Washington Street
P.O. Box 83720
Boise, Idaho 83720-0074
Re: Case No. IPC-E-10-24
IN THE MATTER OF THE APPLICA TlON 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 ROCKLAND WIND PROJECT, LLC
Dear Ms. Jewell:
Enclosed for filing please find an original and seven (7) copies of Idaho Power
Company's Application in the above matter.
Very truly yours,~wt:
Donovan E. Walker
DEW:csb
Enclosures
1221 W. Idaho St. (83702)
P.O. Box 70
Boise, ID 83707
DONOVAN E. WALKER (ISB No. 5921)
LISA D. NORDSTROM (ISB No. 5733)
Idaho Power Company
P.O. Box 70
Boise, Idaho 83707
Telephone: [phone]
Facsimile: [phone]
dwalkerCcidahopower.com
InordstromCcidahopower.com
Attorneys for Idaho Power Company
Street Address for Express Mail:
1221 West Idaho Street
Boise, Idaho 83702
REeE: D
ZOin SEP -8 PM l¡: 49
/DllHOuTlur'iÈf-
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION
OF IDAHO POWER COMPANY FOR
APPROVAL OF A FIRM ENERGY SALES
AGREEMENT FOR THE SALE AND
PURCHASE OF ELECTRIC ENERGY
BETWEEN IDAHO POWER COMPANY
AND ROCKLAND WIND PROJECT, LLC
)
) CASE NO. IPC-E-10-24
)
) APPLICATION
)
)
)
)
Idaho Power Company ("Idaho Powet' or the "Company"), in accordance with
Idaho Code § 61-503 and RP 52 and the applicable provisions of the Public Utility
Regulatory Policies Act of 1978 ("PURPA"), hereby respectfully applies to the Idaho
Public Utilties Commission (the "Commission") for an Order approving the Firm Energy
Sales Agreement between Idaho Power and Rockland Wind Project, LLC ("Rockland")
under which Rockland would sell and Idaho Power would purchase electric energy
generated by the Rockland Wind Project ("Facilty") located in Power County, 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 utilities
purchase power produced by cogenerators or small power producers that obtain
qualifying facility ("OF") status. The rate a OF receives for the sale of its power is
generally referred to as the "avoided cost" rate and is to reflect the incremental cost to
an electric utilty of electric energy or capacity or both, which, but for the purchase from
the OF, 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 OFs, and to
implement FERC rules.
II. FIRM ENERGY SALES AGREEMENT
2. The expected Nameplate Capacity of this Facilty is 80 megawatts ("MW").
Because this amount exceeds 10 average MW, prior Commission rulings require Idaho
Power to negotiate a specific Firm Energy Sales Agreement ("FESA" or "Agreement")
for this OF. Key elements of a negotiated Agreement for a OF that is larger than 10
average MW are:
(a) Energy Purchase Price. Rather than the Facilty qualifying for the
Commission-established, published avoided cost rate set for OF projects in Idaho,
Idaho Power must run the AURORA economic dispatch model consistent with the
Commission requirements for projects larger than 10 MW to establish a basis for the
energy purchase price in the Agreement.
APPLICATION - 2
(b) Terms and Conditions. Idaho Power uses the basic PURPA
contract template that is used for OFs smaller than 10 average MW as a starting point
for the various terms and conditions of the Agreement for a OF project that is larger
than 10 average MW. Through the negotiation process, Idaho Power not only strives to
maintain the key elements of a PURPA agreement but also works with the proposed
project to capture additional terms and conditions that are both favorable to Idaho
Power customers, and are fair terms and conditions with respect to the OF project.
3. On September 3, 2010, Idaho Power and Rockland entered into a FESA
for the Facility pursuant to the terms and conditions of the various Commission Orders
applicable to this PURPA agreement. A copy of the Agreement is attached to this
Application as Attachment NO.1. As a OF PURPA project that exceeds 10 average
MW, the Agreement with Rockland contains many terms and conditions that vary from
the "standard" PURPA FESA that is typically submitted for approval by the Company.
The varying terms and conditions of this Agreement are more favorable to Idaho Power
customers than the "standard" PURPA terms and conditions including: (1) provisions
for partial completion damages; (2) simplified Mechanical Availabilty Guarantee
("MAG") calculation; (3) providing Renewable Energy Credits ("RECs") to the Company
after year 2021; (4) better financial damage and security provisions for the benefit of
customers; (5) more extensive wind forecasting data; (6) a 25-year contract term; and
(7) an energy price that is lower than the published avoided cost rate. Each of these
beneficial terms and conditions is summarized below.
4. Partial Completion Damages. As stated above, the expected Nameplate
Capacity of this Facilty is 80 MW. As specified in paragraph 5.11 of the Agreement, if
APPLICATION - 3
the Nameplate Capacity is less than 72 MW, Idaho Power wil be entitled to collect
Partial Completion Damages from Rockland in the amount of $10,000 per MW less than
72MW.
5. Mechanical Availabilty Guarantee. The MAG calculation within this
Agreement is more stringent and potentially easier to administer then the MAG in
standard PURPA agreements. In both this Agreement and standard PURPA
agreements, the MAG is set at 85 percent. However, in this Agreement, the mechanical
availabilty of the Facilty is determined by dividing the availabilty of each turbine as
recorded in the automated operating system of each turbine by the Nameplate Capacity
of each turbine less Idaho Power caused curtailments. In comparison, in the standard
PURPA agreements, impact of available wind, unplanned maintenance, and many other
factors that are difficult to measure are included in the Mechanical Availabilty
calculation.
6. Renewable Energy Credits. The Facilty retains the rights to all RECs
through the end of calendar year 2021. Idaho Power wil own the rights to all RECs
from the beginning of calendar year 2022 through the remaining term of the Agreement
(a minimum of 15 years). This allows the OF developer to retain the RECs for the initial
10 years of the Agreement and obtain what value it can for them to help offset the cost
of development for the project at a time when the Company does not have a Renewable
Portolio Standard ("RPS") obligation for the RECs. At the same time, it also allows the
Company to retain the RECs for the last 15 years of the Agreement, after the project is
developed and mature, and when a future RPS may require the Company to obtain and
have RECs.
APPLICATION - 4
7. Damages and Security. This Agreement has considerably more identified
damages and security requirements of Rockland than those that are typically applied to
a OF project in a standard PURPA FESA. All specified damages are supported by
liquid security requirements placed upon Rockland. Thus, in the event Idaho Power
must exercise any of the damage claims, there is established security that Idaho Power
may draw upon to satisfy the damages. Just as in standard PURPA agreements,
Rockland must post $45 per KW (80 MW equals $3,600,000) of security that Idaho
Power may draw upon if the Facilty is delayed in achieving its Operation Date.
Additional security required in this Agreement that is above and beyond that required in
standard PURPA agreements includes:
(a) Signing Security - $300,000. Rockland must post this security prior
to Idaho Power filing this Agreement with the Commission seeking its approval. As of
September 3, 2010, Rockland posted the required $300,000 signing security with the
Company.
(b) Operational Security - $1,500,000. Rockland must post this
security prior to the project achieving its Operation Date and shall then maintain this
security for the full term of the Agreement.
8. Wind forecasting. In addition to Rockland being required to contribute to
the Idaho Power wind forecasting cost as specified for all new PURPA wind
agreements, the Agreement also requires Rockland to install, maintain, and provide
wind measurement data from state of the art wind monitoring equipment to Idaho Power
for the full term of the Agreement.
APPLICATION - 5
9. Contract Term. The Facilty has selected July 15, 2011, as the Scheduled
First Energy date and December 31, 2011, as the Scheduled Operation Date. The
contract term specified in this Agreement is 25 years. This term is greater than the
standard term of 20 years as provided in the less than 10 MW PURPA agreements.
This 25-year contract term was a result of negotiations that attempted to balance many
related factors within the Agreement in a manner that was favorable to Idaho Power
customers and also manageable for Rockland. Some of those factors are: the projects
willngness to meet performance requirements for the full 25-year term; financial
security in place for the entire term; advantageous energy pricing for the years past 20
years; Idaho Power ownership of the RECs generated in years 11 through 25; and
Idaho Powets right of first offer to participate in expansion and/or ownership of the
Facility at any time during the term of the Agreement.
10. Energy Price. As a basis for energy prices in this Agreement, Idaho
Power executed the AURORA economic dispatch model for this Facilty's estimated
energy shape as specified by Commission requirements. This model provides strictly
an energy price based upon the estimated generation from this Facilty being available
to meet Idaho Powets customers' energy needs. This AURORA energy price contains
no value for RECs or other items of value identified within the Agreement. The energy
price identified by the AURORA run, including a discount of $6.50 per megawatt-hour
("MWh") for wind integration, was a levelized price of $56.21. In comparison, the
Published Avoided Cost levelized price for a 10 average MW or less PURPA wind
project with a planned on-line year of 2011 is $75.88 per MWh.
APPLICATION - 6
11. The negotiated levelized energy price contained within this Agreement for
the 25-year term calculates to be $71.29 per MWh. The actual all hours energy pricing
stream (paragraph 7.3 of the Agreement) begins at $57.15 per MWh in 2011, escalates
at 2.5 percent through the first 20 years to $91.36 in the twentieth contract year (2030),
then escalates at a reduced rate of 2 percent for the last 5 years of the Agreement,
ending at a price of $101.37 in the twenty-fifth contract year (2035). In comparison, the
Published Avoided Cost rate available to PURPA wind projects less than 10 average
MW for the year 2011 is $55.26 per MWh, escalating to $113.21 per MWh in year 2030.
This Agreement also contains both the seasonal and time-of-day pricing as required in
all PURPA agreements.
12. Although the $71.29 levelized energy price within this Agreement is
greater than the base AURORA value of $56.21, it is also lower than the Published
Avoided Cost rate of $75.88. This Agreement provides many additional items of value
to Idaho Power and its customers in comparison to a standard PURPA agreement for
OFs 10 MW and under. Some of those items being REC ownership, greater security
and damage provisions, wind forecasting data, additional contract years at
comparatively lower cost, and the right of first offer for ownership or expansion of this
site. In addition, the $71.29 price is considerably lower than prices bid into the 2012
Wind RFP issued in May 2009, which Idaho Power recently concluded without awarding
a contract.
13. Rockland made this unsolicited proposal of a large 80 MW PURPA project
to Idaho Power and requested Idaho Power negotiate this Agreement as required by the
applicable PURPA rules and regulations. Historically, many developers have avoided
APPLICATION - 7
or attempted to avoid this large PURPA contracting process by dividing a large project
into multiple, less than 10 average MW projects, thus invoking application of the
Published Avoided Cost Rate and the more prescriptive contracting process applicable
to those smaller OF projects. Idaho Power believes that the negotiations with Rockland,
which resulted in the present Agreement, evidence the fact that the large PURPA
negotiation process is viable and can result in a project that is both feasible for the
developer and more favorable to Idaho Power customers as compared to FESAs for 10
average MW or smaller OF projects.
II. INTERCONNECTION AND TRANSMISSION
14. The FESA provides that Rockland must have completed an
interconnection feasibilty study, is responsible to complete a Generation
Interconnection Agreement ("GIA"), and is responsible for all costs associated with
interconnection of the Facilty to Idaho Powets system. As of the time of filng this
Application, Idaho Power has completed the feasibility study, and Rockland has
accepted the same. The parties are in the final stages of a facilty study with an
executed GIA to follow. Idaho Power Power Supply has also filed a Transmission
Service Request for this project (rated at 80 MW) and has received a favorable
response from the transmission group that transmission capacity is available for this
project contingent upon completion of the GIA and this Agreement.
IV. MODIFIED PROCEDURE
15. As with all PURPA FESAs, this Agreement provides that it wil not become
effective until the Commission has approved all of the Agreement's terms and
conditions and declared that all payments Idaho Power makes to Rockland for
APPLICATION - 8
purchases of energy wil be allowed as prudently incurred expenses for ratemaking
purposes. See, § 21.1. Additionally, during negotiations, Rockland advised Idaho
Power that they have some key time constraints on developing this project and desired
a provision that allows them to terminate the Agreement if Commission approval is not
received within 90 days after the Agreement is filed for approval at the Commission.
16. The Company was hesitant to agree to include such a provision in the
Agreement, being mindful of the Commission's process and procedure and aware of the
fact that the Commission has many demands upon its time and resources. However,
agreement to such a provision was required to execute the Agreement, which Idaho
Power believes contains several other provisions that are beneficial to its customers.
The Company contacted legal counsel for Commission Staff, notifying them about the
existence of this 90-day provision regarding Commission approval prior to signing the
Agreement and submitting the same to the Commission for approvaL. Should the
Commission determine that Modified Procedure is appropriate in this case, it may be
possible for the Commission to complete its review and issue an Order in this matter
within 90 days of the initial filng.
17. Idaho Power believes that a hearing is not necessary to consider the
issues presented herein and therefore respectfully requests that this Application be
processed under Modified Procedure, Le., by written submissions rather than by
hearing. RP 201, et seq. Additionally, to meet the needs and request of the project
developer, the Company respectfully requests that a Modified Procedure comment
period be established such that a determinative Order in this matter may be issued
within 90 days of the date the Application is filed.
APPLICATION - 9
V. COMMUNICATIONS AND SERVICE OF PLEADINGS
18. 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
Lisa Nordstrom, Lead Counsel
Idaho Power Company
1221 West Idaho Street
P.O. Box 70
Boise, Idaho 83707
dwalkerCcidahopower.com
InordstromCcidahopower.com
Randy C. Allphin
Energy Contract Administrator
Idaho Power Company
1221 West Idaho Street
P.O. Box 70
Boise, Idaho 83707
rallphinCcidahopower.com
VI. REQUEST FOR RELIEF
19. Idaho Power Company respectfully requests that the Commission: (1)
issue an Order authorizing that this matter may be processed by Modified Procedure;
(2) issue an Order within 90 days of the filng of this Application both approving the Firm
Energy Sales Agreement between Idaho Power Company and Rockland Wind Project,
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
Rockland Wind Project, LLC, be allowed as prudently incurred expenses for ratemaking
purposes.
Respectfully submitted this 8th day of September 2010.
£lJ)~_.
DONOVAN E. WALKER
Attorney for Idaho Power Company
APPLICATION - 10
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on this 8th day of September 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:
Rockland Wind Project, LLC
Dennis Meany, President
Joan Hutchinson, VP of Origination and Marketing
Rockland Wind Project, LLC
1300 North Northlake Way, 2nd Floor
Seattle, Washington 98103
Hand Delivered
-- U.S. Mail
_ Overnight Mail
FAX
Email
~
APPLICATION - 11
BEFORE THE
IDAHO PUBLIC UTiliTIES COMMISSION
CASE NO. IPC-E-10-24
IDAHO POWER COMPANY
ATTACHMENT NO.1
FIRM ENERGY SALES AGREEMENT
BETWEEN
IDAHO POWER COMPANY
AND
ROCKLAND WIND PROJECT LLC
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FIR ENERGY SALES AGREEMENT
BETWEEN
IDAHO POWER COMPANY
AN
ROCKLAN WIN PROJECT LLC
TABLE OF CONTENTS
Aricle
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
TITLE
Definitions
No Reliance on Idao Power
Waranties
Conditions to Acceptance of Energy
Ter and Operation Date
Purchase and Sale of Net Energy
Purchase Price and Method of Payment
Environmental Attrbutes
Facilty and Interconnection
Meterig and Telemetry
Records
Operations
Indemnification and Insurance
Force Majeure
Liabilty; Dedication
Several Obligations
Waiver
Choice of Laws and Venue
Disputes and Default
Governental Authorization
Commssion Order
Successors and Assigns
Modification
Taxes
Notices
Additional Terms and Conditions
Severabilty
Counterars
Entire Agreement Signatures
Appendix A
AppendixB
AppendixC
AppendixD
AppendixE
AppendixF
AppendixG
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FIR ENERGY SALES AGREEMENT
Project Name: Rockland Wind Project
Project Number: 41455300
THIS FIR ENERGY SALES AGREEMENT ("Agreement"), entered into on this .. ~ day of
September, 2010 between Rockland Wind Project LLC (Seller), and IDAHO POWER COMPAN, an
Idaho corporation (Idaho Power), hereinafter sometimes referred to collectively as "Paries" or individually
as "Pary."
WITNESSETH:
WHEREAS, Seller wil design, construct, own, maintain and operate an electric generation facility;
and
WHEREAS, Seller wishes to sell, and Idaho Power is wiling to purchase, fir electrc energy
produced by the Seller's Facilty.
THEREFORE, In consideration of the mutual covenants and agreements hereinafter set forth, the
Parties agree as follows:
ARTICLE I: DEFINIONS
As used in this Agreement and the appendices attached hereto, the following terms shall have the
following meanings:
1.1 "Adjusted Facilty Mechancal Availability" means the sum of the actual hours in each calendar
month less any hours, and any portion of an hour (measured in 15-minute intervals), in which a
Force Majeure, an Idaho Power Forced Outage or an Idaho Power failure to receive Net Energy
was in effect that prevented the Facility or portions ofthe Facility from deliverig Net Energy to
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Idaho Power multiplied by the Nameplate Capacity of the Facilty as established in paragraph 5.3
of this Agreement result being measured in MWhs.
1.2 "Availability Shortfall Price" -
1.2.1 For each calendar month beginning before Januar 1, 2022, the difference of the Market
Energy Reference Price for such month, minus the applicable All Hours Energy Price
specified in paragraph 7.3 of this Agreement for such month.
1.2.2 For each calendar month beginning on or after Janua 1,2022, the difference of the
Market Energy Reference Price for such month, plus the Envionmental Attribute
Replacement Value minus the applicable All Hours Energy price specified in
paragraph 7.3 of this Agreement
1.2.3 If the applicable calculation in paragraph 1.2.1 or 1.2.2 results in a value less than 15.00
Mils/Kwh the result shall be 15.00 Mils/Kwh.
1.3 "Business Days" - means any calenda day that is not a Satuday, a Sunday, New Years Day,
Memorial Day, Independence Day, Labor Day, Thansgiving, Chrstmas, or any other NERC
recognized holiday.
104 "Commission" - The Idaho Public Utilities Commission.
1.5 "Contract Year" - The period commencing each calenda year on the same calendar date as the
Operation Date and ending one (1) year thereafter.
1.6 "Critical Permits" has the meaning set forth in pargraph 504.
1.7 "Delay Damages" - Damages payable to Idao Power as calculated in paragraph 5 A, 5.5, 5.6 and
5.7.
1.8 "Delay Period" - All days past the Scheduled Operation Date until the Seller's Facilty achieves the
Operation Date, provided that if Seller's Facility achieves the Operation Date after the Delay
Securty has been exhausted by Idao Power as provided in this Agreement, the Delay Period ends
on the date that the Delay Security equals zero and Idaho Power may terminate this Agreement at
that time with no additional damages being assessed against either Pary.
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1.9 "Delay Price" - Eight Thousand Dollars ($8,000.00) per day.
1.10 "Delay Securty" - The amount of securty, as determined in paragraph 5.9.1, to be provided against
delays in Seller's achievement of the Operation Date.
1.11 "Designated Dispatch Facilty" - Idaho Power's Systems Operations Group, or any subsequent
group designated by Idaho Power.
1.12 "Effective Date" - The date stated in the opening paragraph of ths Fir Energy Sales Agreement
representing the date upon which this Firm Energy Sales Agreement was fully executed by both
Paries.
1.13 "Facility" - That electric generation facility described in Appendix B of this Agreement.
1.14 "Facilty Mechanical Availabilty" - A monthly estimate, measurd in MWhs prepared and
documented after the fact by the Seller, reviewed and accepted by the Buyer in accordace with
pargraph 6.6.1 that is the sum of the available hours and any portion of an hour (measured in 15
minute intervals), of each wind turbine as recorded on each wind turbines operations system
(SCADA) multiplied by the Nameplate Capacity of each wind turbine. The Seller shall collect and
maintain actual data to support this calculation and shall keep this data for a minimum of 3 years.
1.15 "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
Idaho Power at the Point of Delivery.
1.16 "Environmental Attributes" means any and all credits, benefits, emissions reductions, offsets, and
allowances, howsoever entitled, attrbutable to the generation from the Facilty, and its avoided
emission of pollutants. Environmental Attributes include but are not limited to: (1) any avoided
emission of pollutants to the air, soil or water such as sulfu oxides (SOx), nitrogen oxides (NOx),
carbon monoxide (CO) and other pollutants; (2) any avoided emissions of carbon dioxide (C02),
methane (CH4), nitrous oxide, hydrofluorocarbons, perfuorocarbons, sulfur hexafluoride and
other greenhouse gases (GHGs) that have been determned by the United Nations
Intergovernental Panel on Climate Change, or otherwise by law, to contribute to the actual or
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potential threat of alterig the Earh's climate by trapping heat in the atmosphere;! (3) the reporting
rights to these avoided emissions, such as Green Tag Reporting Rights. Green Tag Reporting
Rights are the right of a Green Tag Purchaser to report the ownership of accumulated Green Tags in
compliance with federal or state law, if applicable, and to a federal or state agency or any other
party at the Green Tag Puchaser's discretion, and include without limitation those Green Tag
Reporting Rights accruing under Section 1605(b) of The Energy Policy Act of 1992 and any
present or futue federal, state, or local law, regulation or bil, and international or foreign
emissions trading program. Green Tags are accumulated on a MWh basis and one Green Tag
represents the Environmental Attributes associated with one (1) MWh of Energy. Environmental
Attributes do not include (i) any energy, capacity, reliabilty or other power attbutes from the
Facility, (ii) production tax credits associated with the constrction or operation of the Facility and
other financial incentives in the form of credits, reductions, or allowances associated with the
Facilty that are applicable to a state or federal income taxation obligation, (iii) the cash grant in lieu
of the investment tax credit pursuant to Section 1603 of the American Recovery and Reinvestment
Act of2009, or (iv) emission reduction credits encumbered or used by the Facility for compliance
with local, state, or federal operating and/or air quality permits.
1.17 "Envionmental Attribute Replacement Value" - means a) through the calenda year of2021 the
lesser of $25 per MWh or the documented value of the affected Pary's lost RECs, expressed in
dollars per MWh or b) for the calenda year of 2022 and beyond the lesser of $25 escalated by 2%
for each calendar year past 2021 or the documented value of the affected Pary's lost RECs,
expressed in dollars per MWh.
1.18 "Heavy Load Hour" - The daily hours beginng at 7 :00 am, ending at 11 :00 pm Mountain Time,
(16 hours) excluding all hours on all Sundays, New Years Day, Memorial Day, Independence Day,
Labor Day, Thanksgiving, and Chrstmas.
Avoided emissions mayor may not have any value for GHG compliance puroses. Although avoided
emissions are included in the list of Environmental Attbutes, ths inclusion does not create any right to use those
avoided emissions to comply with any GHG regulatory program.
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1.19 "Idaho Power Forced Outage" - a parial or total reduction of Idaho Power's ability to accept Net
Energy at the Point of Delivery for non-economic reasons, as a result ofIdao Power: 1) equipment
failure which was not the result of negligence or lack of preventative maintenace or 2) unplanned
preventative maintenance to repair equipment that left unrepaired, would result in failure of
equipment prior to the planed maintenance period or 3) planed maintenance or constrction of
electrical lines required to serve this Facilty. Idaho Power shall make commercially reasonable
efforts to perform the planed and unplanned preventative maintenance durng periods oflow wind
availability.
1.20 "Interconnection Facilties" - All equipment specified in Seller's interconnection agreement.
1.21 "Light Load Hours" - The daily hours beginnng at 11 :00 pm, ending at 7:00 am Mountai Time (8
hours), plus all other hour on all Sundays, New Years Day, Memorial Day, Independence Day,
Labor Day, Thanksgiving, and Chrstmas.
1.22 "Losses" - The loss of electrcal energy expressed in kilowatt hours (kWh) occurg as a result of
the transformation and transmission of energy between the Meterig Point and the Point of
Delivery. The loss calculation formula wil be as specified in Appendix B of this Agreement. If the
Metering Point is physically located at the Point of Delivery and measures the actual energy
delivered to the Idaho Power electrical system at that point then the Losses wil be zero.
1.23 "Market Energy Reference Price" - Eighty five percent (85%) of the Mid-Columbia Market
Energy Cost.
1.24 "Material Breach" - A Default (paragraph 19.2.1) subject to paragraph 19.2.2.
1.25 "Maximum Capacity Amount" - The maximum capacity (MW) of the Facilty wil be as specified
in Appendix B of this Agreement.
1.26 "Mechanical Availabilty" - The percentage amount calculated by Seller within five (5) days after
the end of each month of the Facility's monthly mechanical availabilty, calculated as the quotient
of the Facilty Mechanical Availabilty (MWhs) divided by the Adjusted Facility Mechanical
Availabilty (MWhs) Availabilty for the applicable month. Any damages due as a result of the
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Seller falling short of the Mechanical Availability Guarntee for each month shall be determed in
accordance with paragraph 6.6.4.
1.27 "Mechancal Availabilty Guarantee" shall be as defined in paragraph 6.6.
1.28 "Metering Equipment" - All equipment specified in Seller's interconnection agreement, this
Agreement and any additional equipment specified in Appendix B required to measure, record and
telemeter bi-directional power flows from the Seller's Facility at the Metering Point.
1.29 "Metering Point" - The physical point at which the Metering Equipment is located that enables
accurate measurement of the Test Energy and Net Energy deliveries to Idao Power at the Point of
Delivery for this Facilty that provides all necessar data to admnister this Agreement.
1.30 "Mid- Columbia Market Energy Cost" - Ninety percent (90%) of the monthly weighted average of
the daily on-peak and off-peak Intercontinental Exchange Mid-Columbia Index (ICE Mid-C Index)
prices for firm energy. If the ICE Mid-C Index price is discontinued by Intercontinental Exchange,
both Paries wil mutually agree upon a replacement index, which is similar to the ICE Mid-C
Index. The selected replacement index wil be consistent with other similar agreements and a
commonly used index by the electrical industry.
1.31 "Nameplate Capacity" -The full-load electrical quantities assigned by the designer to a generator
or other piece of electrcal equipment, such as transformers and circuit breakers, under standadized
conditions, expressed in amperes, kilovolt-amperes, kilowatts, volts or other appropriate units.
Usually indicated on a nameplate attached to the individual machine or device.
1.32 "Net Energy" - All of the electric energy produced by the Facilty, less Station Use, less Losses,
expressed in kilowatt hours (kWh) delivered to Idaho Power at the Point of Delivery. 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.
1.33 "Operation Date" - The day commencing at 00:01 hours, Mountain Time, following the day that all
requirements of paragraph 5.3 have been completed.
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1.34 "Point of Delivery" - The location specified in Appendix B, where Idaho Power's and the Seller's
electrical facilities are interconnected and the energy from this Facilty is delivered to Idao Power.
1.35 "Prudent Electrical Practices" - Those practices, methods and acts that would be implemented and
followed by prudent operators of electric transmission facilities (with respect to Idaho Power) or
prudent operators of electric generation facilities similar to the Facility (with respect to Seller) in
the Wester United States durg the relevant time period, which practices, methods and acts, in the
exercise of prudent and responsible professional judgment in the light of the facts known at the time
the decision was made, could reasonably have been expected to accomplish the desired result
consistent with good business practices, reliability and safety, and shall include, at a minum,
those professionally responsible practices, methods and acts described in the preceding sentence
that comply with manufactuers' warnties, restrictions in this Agreement, and the requirements of
governental authorities with jurisdiction over the applicable Pary, WECC standads, and
applicable Law. Good Industry Practice is not intended to be the optimum practice; method or act
to the exclusion of all others, but rather is intended to be any of the practices, methods and/or
actions generally accepted in the region.
1.36 "PTC" - The Production Tax Credits applicable to electricity produced from certain renewable
resources pursuat to 26 U.S.C. § 45, or replacement or substitute tax benefits based on energy
production from the Facility.
1.37 "PTC Value" - If the Seller elects to receive PTCs for this Facilty, an amount equal to: (a) the
PTCs to which Seller would have been entitled with respect to renewable energy (i) it is unable to
deliver because of a Buyer event of default or (ii) that Buyer fails to receive and such failure is not
excused by the terms of this Agreement; plus (b) a "gross up" amount to tae into account the
federal, state and local income tax to Seller on such payments in lieu of PTCs, so that the net
amount retained by Seller, after payment of federal, state and local income taxes, is equal to the
amount set forth in clause (a) of this defition. For puroses of determining the foregoing, Seller
shall deliver a certificate from an offcer of Seller stating the corporate income tax rates (federal,
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state or local, as applicable) that are in effect for the Seller durg the tax year in which the receipt
of such PTC Value is taxed, and such income tax rates shall be used in the calculation of the PTC
Value. If the Seller does not elect to receive PTC's for this Facility, the PTC Value shall be zero (0).
1.38 "Renewable Energy Certificate" or "REC" means a cerificate, credit, allowance, green tag, or
other transferable indicia, howsoever entitled, indicating generation of renewable energy by the
Facility, and includes all Environmental Attributes arsing as a result of the generation of electricity
associated with the REC. One REC represents the Environmental Attributes associated with the
generation of one thousand (1,000) kWh of Net Energy.
1.39 "Scheduled Operation Date" - The date specified in Appendix B when Seller anticipates achieving
the Operation Date, as such date may be extended in accordace with pargraph 5,4. It is expected
that the Scheduled Operation Date provided by the Seller shall be a reasonable estimate of the date
that the Seller anticipates that the Seller's Facility shall achieve the Operation Date.
1,40 "Season" - The three periods identified in pargraph 6,4.1 of this Agreement.
1,41 "Serial Defect" means an equipment failure, or a foreseen equipment failure, after installation of
the equipment that is a result of a manufacturer's materal manufactung or design defect, or a
defect that occurs in thiy percent (30%) or more of the equipment installed and which the Seller
had no knowledge of prior to the equipment being installed at this Facilty.
1,42 "Station Use" - Electric energy that is used to operate equipment that is auxilar or otherwise
related to the production of electricity by the Facility.
1,43 "Term" has the meaning set forth in paragrph 5.1.
1,44 "Test Energy" - All Net Energy produced by the Seller's Facility and delivered by the Facility to
the Idaho Power electrcal system prior to the Operation Date.
1,45 "Wind Energy Production Forecast" - A forecast of energy deliveries from this Facility provided
by an Idaho Power administered wind forecasting model, as described in Appendix E.
1,46 "Wind Energy Production Forecasting Monthly Cost Allocation" or "MCA" has the meaning set
forth in Appendix E.
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ARTICLE II: NO RELIANCE ON IDAHO POWER
2.1 Seller Independent Investigation - Seller warrants and represents to Idao Power that in enterig
into this Agreement and the undertakng by Seller of the obligations set forth herein, Seller has
investigated and detered that it is capable of performing hereunder and has not relied upon the
advice, experience or expertise of Idaho Power in connection with the trasactions 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 undertng 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 facilties shall not be an endorsement or a confiration by
Idaho Power and Idaho Power makes no waranties, expressed or implied, regarding any aspect of
Seller's design, specifications, equipment or facilities, including, but not limited to, safety,
durabilty, reliabilty, strength, capacity, adequacy or economic feasibilty.
3.2 Qualifying Facilty Status - Seller warnts that the Facility wil be a "Qualifyng Facilty," as that
term is used and defined in 18 CFR 292.201 et seq. prior to the delivery of any Test Energy or Net
Energy for sale pursuant to this Agreement. Afer intial qualification, Seller wil tae such steps as
may be required to maintain the Facility's Qualifying Facilty status under 18 CFR §292.20 1 et.
seq. durng the full term of this Agreement, and Seller's failure to maintain Qualifyng Facilty
status wil be a Material Breach of this Agreement. As specified in paragrph 4.1.1, as a condition
to achieve a First Energy Date, the Seller shall provide documentation and evidence that the
Facilty is a Qualifyng Facility. After the First Energy Date Idaho Power reserves the right to
request and review the Qualifying Facility status and associated support and compliance
documents at anytime during the term of this Agreement.
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ARTICLE IV: CONDITIONS TO ACCEPTANCE OF ENERGY
4.1 Prior to the First Energy Date, Seller shall:
4.1.1 Submit proof to Idaho Power that all licenses, permits 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 18 CFR 292.201 et seq. as a certified
Qualifying Facilty.
4.1.2 Opinion of Counsel- Submit to Idaho Power an Opinon Letter signed by an attorney
admitted to practice and in good standing in the State of Idaho providing an opinon 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 opinon that Seller is in substantial compliance with
said permits as of the date of the Opinon Letter. The Opinion Letter wil be in a form
acceptable to Idaho Power and will acknowledge that the attorney rendering the opinon
understands that Idaho Power is relying on said opinion. Idaho Power's acceptace of the
form wil not be uneasonably withheld. The Opinion Letter wil be governed by and shall
be interpreted in accordance with the legal opinion accord ofthe American Bar Association
Section of Business Law (1991).
4.1.3 Mechanical Completion Certificate - Submit to Idaho Power a copy of the Mechancal
Completion Certificate provided by the engineering, procurement, and construction
contractor for each wind turbine prior to the star of commissioning for such wind turbine.
4.1.4 Nameplate Capacity - Submit evidence to Idao Power that the Nameplate Capacity that
wil be established in paragraph 5.3 of this Agreement is not designed to exceed the
Maximum Capacity.
4.1.5 Insurance - Submit written proof to Idao Power of all insurance required in Aricle XIII.
4.1.6 Interconnection - Provide written confirmation from Idaho Power's delivery business unt
that Seller has satisfied all material interconnection requirements.
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4.2 The Facilty shall be designated as an Idao Power network resource capable of deliverig firm
energy up to the Maximum Capacity Amount no later than the First Energy Date. Seller shall
supply to Idaho Power all Facility information and data that is required to enable Idao Power to
request this designation no later than 60 days prior to the First Energy Date.
ARTICLE V: TERM AND OPERATION DATE
5.1 Ter - Subject to the provisions of paragraph 5.2 below, this Agreement shall become effective on
the Effective Date and, uness earlier termnated pursuant to the terms of this Agreement, shall
continue in full force and effect for a period of twenty five (25) Contract Years from the Operation
Date ("Term").
5.2 Extension of Term - prior to the end ofthe Term of this Agreement, the Parties may mutually agree
to negotiate the extension of the Term of this agreement.
5.3 Operation Date - The Operation Date may occur only after the Facility has achieved all of the
following:
a) Achieved the Firt Energy Date.
b) Commission approval of this Agreement in a form reasonably acceptable to both of the
Paries has been received.
c) Seller has submitted an executed Engineer's Certification of Design & Construction
Adequacy and an Engineer's Certification of Operations and Maintenance (O&M)
Policy, in substantially the form specified in Appendix C, as may be modified to the
extent necessar to recognize the different engineering disciplines providing the
certificates. If Idaho Power does not dispute the validity of these certificates within
five (5) days after Seller's submission, then Idaho Power will be deemed to have
accepted the certificates. If Idao Power disputes the validity of these certificates
within five (5) days the Paries shall cooperate to resolve the issues identified by
Idaho Power. If the Paries are not able to resolve the identified issues, the Paries shall
commence the dispute resolution procedures set forth in paragraph 19.1. Until such
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time as the Engineering Certificates are accepted by Idaho Power or the dispute
resolution procedure results in a determination that the Engineerng Certificates meet
the requirements of this paragraph 5.3(c), this requirement shall not be fulfilled;
provided that (i) if the Seller's provided Engineerig Certificates are substantially and
materially complete, the Scheduled Operation Date shall be extended on a day-for-day
basis for each day from the submission of the Engineerg Certificates until the dispute
is resolved, and (ii) if after resolution of the Idao Power identified issues, it is deemed
that the initial certificates submitted by the Seller were in substantial compliance with
all material requirements, the date of the intial submittal shall be established as the
date that this requirement was fulfilled.
d) Nameplate Capacity - Submit to Idao Power manufacturer's and engineerng
documentation that establishes the Nameplate Capacity of the Facility.
e) Security Requirements - Provide Idao Power with a Letter of Credit or Cash Escrow
Security (as those terms are defined in this pargraph), Guarantee (as defied in
Appendix D), or other forms of liquid financial security that would provide readily
available cash to Idaho Power upon the occurrence of an event of default under this
Agreement. The value of these security instruments shall be $1,500,000.00 and Seller
shall have the right at any timé during the Term to substitute among the forms of
securty provided for in this paragraph 5.3(e).
1. Cash Escrow Securty - If Seller elects to provide Cash Escrow
Securty, Seller shall deposit fuds in an escrow account established
on behalf of Idaho Power in a banng institution acceptable to both
Paries equal to value of the securty as specified above. Such sum
shall ear interest in accordance with the terms of the escrow
agreement. To the extent Idaho Power receives payment from the
escrow account, Seller shall, withi fifteen (15) days thereafter,
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restore the value of the escrow account as if no such deduction had
occurred, unless this Agreement has been terminated.
11. Letter of Credit or Guartee - If Seller elects to provide a Letter of
Credit or Guaantee, Seller shall post and maintain in an amount equal
to the value of the securty as specified above: (a) a Guatee frm
Seller's corporate parent or a pary meeting the Credit Requirements
(as defined in Appendix D), or (b) a Letter of Credit from a pary
meeting the Credit Requirements (as defined in Appendix D) in favor
ofIdaho Power and in a form substantially similar to the form attached
hereto as Appendix F. To the extent Idaho Power receives payment
from the guarantor or draws upon the Letter of Credit, Seller shall,
within fifteen (15) days thereafter, restore the value of the Guarantee
or Letter of Credit as if no such deduction had occurred, unless this
Agreement has been terminated.
t) Seller has provided written notice of the requested Operation Date to Idaho Power five
(5) Business Days prior to the requested Operation Date.
g) Subject to paragraph 5.10.2, if the Delay Security remaining on the Operation Date is
in excess of $1 ,500,000, the Seller may notify Idao Power to retain $1,500,000 of the
unallocated Delay Security to meet the Seller's $1,500,000 security requirement
required to be posted at the Operation Date. If the Seller makes this request,
Idaho Power shall only return to the Seller the unallocated Delay Securty less
$1,500,000
5.4 Operation Date Delay - Seller shall cause the Facilty to achieve the Operation Date on or before
the Scheduled Operation Date. The Scheduled Operation Date shall be extended on a day-for-day
basis for each day of delay, caused by (a) an inability or delay in obtainng critical path permts,
which shall include but not be limited to building permits ("Critical Permits") despite Seller's use
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of commercially reasonable efforts to obtain timely such Critical Perits, (b) an event of Force
Majeure, or (c) delays in the interconnection and transmission network upgrade study, design and
construction process. Provided that such delays are not the result of any action or inaction by the
Seller acting in a commercially reasonable maner, and provided that Seller is in material
compliance with its obligations under its interconnection agreement.
5.4.1 If the Operation Date occurs after the Scheduled Operation Date, Idao Power may draw
upon the Delay Security in the amount of the Delay Damages, which shall be calculated at
the end of each calenda month after the Scheduled Operation Date as follows:
Delay Damages are equal to the number of days in the Delay Period multiplied by
the Delay Price.
5.5 If Seller has not achieved the Operation Date as of the date that is six (6) months after the
Scheduled Operation Date (as it may be extended pursuant to paragraph 5.4), then either Pary may
terminate this Agreement within thirty (30) days after such date, effective upon written notice to the
other Pary, and Idaho Power shall be entitled to retain any remaining Delay Security as its sole and
exclusive remedy for any inability of Seller to obtain the Operation Date by such date. If neither
Party termnates this Agreement, then Idaho Power may continue to draw upon the Delay Security
in the amount of the Delay Damages puruat to paragraph 5.41.
5.6 The Paries agree that the daages Idaho Power would incur due to delay in the Facilty achievig
the Operation Date on or before the Scheduled Operation Date would be diffcult or impossible to
predict with certainty, and that the Delay Liquidated Damages are an appropriate approximation of
such daages.
5.7 The Paries agree that the damages Idaho Power would incur due to Seller's inabilty to achieve the
Operation Date within six (6) months after the Scheduled Operation Date would be difficult or
impossible to predict with certainty, and that the portion of the Delay Securty remaining undrawn
at such time is an appropriate approximation of such daages.
5.8 Prior to the Seller executing this Agreement:
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a) Seller has filed for interconnection and is in material compliance with all payments and
requirements of the interconnection process
b) Seller has received and accepted an interconnection feasibilty study for this Facility.
c) Seller has provided all information required to enable Idao Power to fie an initial
transmission capacity request.
d) Results of the intial transmission capacity request are known and acceptable to the Seller.
e) Seller acknowledges responsibilty for all interconnection costs in accordance with its
interconnection agreement.
5.9 Prior to Idao Power fiing this executed Agreement at the Commission seeking approval;
a) Seller shall post securty in a form as described in Appendix D in the amount of $ 300,000,
or
b) Seller shall waive "Sellers Right to Termnate" as specified in paragraph 5.12.
Ifthe Seller posts securty as required in paragraph 5.9(a), Idaho Power shall:
a) Draw upon this securty to satisfy the termination payments due Idaho Power
if the Seller terminates this Agreement as allowed in paragraph 5.12(a).
b) Release any remaining securty as required in pargrph 5.9(a) after;
i) Termination of this agreement as allowed in pargraph 5.12 has
occured and Idao Power has collected all termination payments due
Idaho Power,
ii) Seller has waived the "Sellers Right to Terminate" as specified in
paragraph 5.12. or
ii) Seller has posted Delay Securty.
5.10 Within thiry (30) days of the date ofa Commission Order, as specified in Aricle XXI, approving
this Agreement, Seller shall post Delay Security in a form as described in Appendix D equal to the
amount calculated in paragraph 5.10.1. Failure to post this Delay Security in the time specified
above wil be a Material Breach of this Agreement and Idaho Power may terminate this Agreement
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if Seller fails to cure such Material Breach within five (5) Business Days after written notice from
Idao Power.
5.10.1 Delay Securty - The Delay Security shall equal forty five dollars ($45) multiplied by the
Maximum Capacity Amount, with the Maximum Capacity Amount being measured in kW.
5.10.1.1 In the event (a) Seller provides Idaho Power with a certification that (1) a
generation interconnection agreement specifyng a schedule that wil enable this
Facilty to achieve the Opertion Date no later than the Scheduled Operation Date
has been campleted and the Seller has paid all required interconnection costs
thereunder, or (2) a generation interconnection agreement is substantially
complete and all material costs of interconnection have been identified and agreed
upon, and (b) the Seller is in material compliance with all terms and conditions of
the generation interconnection agreement, the Delay Security calculated in
accordance with paragraph 5.9.1 wil be reduced by ten percent (10%).
5.10.1.2 If the Seller has received a reduction in the calculated Delay Security as specified
in paragraph 5.9.1.1 and subsequently (a) at Seller's request, the generation
interconnection agreement specified in paragraph 5.9.1.1 is revised and as a result
the Facility wil not achieve its Operation Date by the Scheduled Operation Date or
(b) if the Seller does not maintain compliance with the generation interconnection
agreement, the full amount of the Delay Security as calculated in paragraph 5.9.1
wil be subject to reinstatement and wil be due and owing within 15 Business
Days from the date Idaho Power requests reinstatement. Failure to timely reinstate
the Delay Security wil be a Material Breach of this Agreement if such failure is
not cured within five (5) Business Days after written notice from Idao Power.
5.10.2 Idaho Power shall calculate the amount of any Delay Damages owed by Seller and release
any remaining Delay Securty withi (a) five (5) Business Days after the Operation Date,
provided that Idaho Power shall not be required to release the amount, if any, of the Delay
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Security that Seller has elected to apply towards its security obligations under pargraph
5.3(g), or (b) if this Agreement is terinated prior to Seller achievig the Operation Date,
60 days after the Agreement has been termnated. Notwithstadig anything to the
contrary in this Agreement, Seller's liability for any breach of this Agreement by Seller or
termination of this Agreement prior to the Operation Date, except for any breach caused by
Seller's wilful misconduct, shall be limited to no more than the amount of the Delay
Securty. The Delay Securty as determined in paragraph 5.10.1 is a fixed amount and
Seller shall not be required to replenish such Delay Securty if and when it is drwn upon
by Idaho Power.
5.10.3 Progress Reports. Withi ten (10) Business Days after the end of each calenda month
following the Effective Date until the Operation Date is achieved, Seller shall submit
progress reports to Idao Power on the development and construction of the Facility.
Idao Power shall rely on these progress reports to schedule the transmission capacity
availabilty and other factors that wil impact Idaho Power's abilty to accept the Test
Energy and/or Net Energy from the Facility.
5.11 Partial Completion Damages - If the Nameplate Capacity established puruant to paragraph 5 .3( d)
is less than seventy-two (72) MW, then Idaho Power shall be entitled to draw upon and retain a
portion of the Delay Security equal to the product of (a) the difference of seventy-two (72) MW,
mius the Nameplate Capacity, in MW, multiplied by (b) ten thousand dollars per MW
($ 1 O,OOO/MW). Drawing upon and retaining such portion of the Delay Security shall be
Idaho Power's sole and exclusive remedy for any failure of Seller to develop and place in operation
the full seventy-two (72) MW of electrcal generating capacity.
5.1 2 Seller Terination Right. If Seller is unable to obtain an agreement for the sale ofRECs associated
with the expected Net Energy produced by the Facility on terms acceptable to Seller, then Seller
shall have the right to terminate this Agreement, effective upon written notice to Idaho Power,
provided that Seller shall be liable to Idaho Power for a termination payment equal to (a) $300,000
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if Seller provides notice of termation prior to receipt of Commission approval of this Agreement,
(b) $1,000,000 if Seller provides notice of termination on or before the date that is thiy (30) days
after receipt of Commission approval of this Agreement, or (c) the amount of the Delay Securty if
Seller provides notice of termnation more than sixty (60) days after receipt of Commission
approval of this Agreement.
ARTICLE VI: PURCHASE AN SALE OF NET ENERGY
6. i Delivery and Acceptance of Net Energy - Except when either Party's performance is excused as
provided herein, Idaho Power wil purchase and receive and Seller wil sell and deliver all of the
Net Energy to Idaho Power at the Point of Delivery.
6.2 Delivery and Acceptance of Test Energy - It is understood by both Parties that prior to the
Operation Date both Paries are commissioning and testing the applicable interconnection and
generation equipment and interrptions of the Facilty's ability to deliver Test Energy to
Idaho Power may occur. The Seller and Idaho Power shall cooperate and coordinate the testing of
the varous equipment to miniize these interrptions.
6.3 At no time wil the instantaneous amount of Net Energy and/or Test Energy produced by the
Facility and delivered by the Seller to the Point of Delivery exceed the Maxum Capacity
Amount.
6.4 Net Energy Amounts - Seller intends to produce and deliver Net Energy in the following monthly
amounts. The Paries agree that the actual amount of Net Energy produced by the Facilty and
delivered by Seller to the Point of Delivery may var from these estimates. These amounts shall be
consistent with the Mechancal Availabilty Guarantee associated with the wind turbines selected
by Seller in its sole and reasonable discretion. Upon final selection of wind tubines by Seller,
Seller shall have the right to revise the amounts set forth in this paragraph as well as the Facility
description in Appendix B.
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6.4.1 Intial Yea Monthly Net Energy Amounts:
Month kWh
March 20,918,000
Season 1 April 20,015,000
May 16,735,000
July 10,548,000
August 12,374,000
Season 2 November 21,384,000
December 26,752,000
June 15,111,000
September 13,001,000
Season 3 October 18,679,000
Januar 24,395,000
Februar 18,150,000
Total 218,062,000
6.5 Unless excused by an event of Force Majeure, Seller's failure to deliver Net Energy in any Contract
Year in an amount equal to at least ten percent (10%) of the sum of the Intial Year Monthly Net
Energy Amounts as specified in pargraph 6.4 shall constitute an event of default.
6.6 Mechanical Availabilty Guarantee - For each full calendar month beginng after the Operation
Date has been established, the Facility shall achieve a minimum monthly Mechancal Availabilty
for the Facilty of at least (a) eighty percent (80%), in respect of each of the first six (6) full calendar
months after the Operation Date, or (b) eighty-five percent (85%), in respect of each full calenda
month thereafter (the "Mechanical Availability Guartee"). Failure to achieve the Mechanical
Availability Guarantee shall result in Idaho Power calculating damages as specified in
paragrph 6.6.4.
6.6.1 Within five (5) days after the end of each month, the Seller shall provide and cerify the
calculation of the Facility's Mechanical Availabilty for the previous month. The Seller
shall include a summar of all information used to calculate the Mechancal Availabilty,
including but not limited to: (a) hourly turbine availability, (b) Force Majeure events,
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Idaho Power Forced Outages, and Idaho Power failure to receive Net Energy. If
Idaho Power disputes Seller's calculation of the Facility's Mechancal Availabilty, Idaho
shall notify Seller and if not resolved informally by the Paries, such disputes shall be
resolved in accordance with Aricle XIX.
6.6.2 The Seller shall maintain and retain for thee (3) years detailed documentation supporting
the calculation ofthe Facilty's Mechancal Availabilty.
6.6.3 Idao Power shall have the right to review and audit the documentation supporting the
calculation of the Facility's Mechanical Availabilty at the Seller's Facility or other
mutually agreed location durig normal business hours and upon reasonable advance
notice.
6.6.4 If the previous month's Mechancal Availabilty is less than the Mechanical Availability
Guarantee, then the damages for such month shall be equal to the product of (a) the
difference between (i) the Mechanical Availabilty Guarantee, minus (ii) the Mechanical
Availability for such month, multiplied by (b) the Initial Year Monthly Net Energy amount
set forth in paragraph 6.4.1 for the applicable month, multiplied by (c) the Availability
Shortfall Price (Example included as Appendix G). Notwithstanding anythig to the
contrar in this Agreement, the aggregate damages payable by Seller due to actual
Mechanical Availabilty of less than the Mechanical Availability Guarantee shall not
exceed $3.2 milion in any Contract Year nor $16.0 milion cumulatively over the Term of
this Agreement. The caps on liability set forth in the foregoing sentence shall not limit
Seller's liabilty for a breach of this Agreement caused by Seller's wilful misconduct.
6.6.5 Any damages calculated in paragraph 6.6.4 wil be offset against the current
month's energy payment. If an unpaid balance remains after the damages are offset
against the energy payment, the Seller shall pay in full the remaining balance
within 30 days of the date of the invoice.
6.7 Tax Credits and Grants. Idao Power agrees and acknowledges that any and all financial
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incentives, benefits or credits associated with the Facilty, or the ownership or operation thereof, or
the output of the Facility, including any production or investment tax credits, real or personal
property tax credits, the cash grant available from the United States Deparment of Treasur in lieu
ofITCs (as provided by Section 1603 of the American Recovery and Reinvestment Act of2009), or
sales or use tax credits in effect on the Effective Date shall be owned by Seller. In the event that
new tax credits or increased levels of existing tax credits, or other financial incentives applicable to
the Facility or the output of the Facility are enacted or implemented after the Effective Date and
durng the Term of the Agreement, Seller shall own all such new or increased financial incentives.
ARTICLE VII: PURCHASE PRICE AN METHOD OF PAYMENT
7.1 Heavy Load Purchase Price - For all Net Energy received durng Heavy Load Hours, Idaho Power
wil pay the non-Ievelized energy price as specified below:
Season 1 - (73.50 %)Season 2 - (120.00 %)Season 3 - (100.00 %)
Year Mils!Kwh Mils!Kwh Mils!Kwh
2011 44.39 72.47 60.39
2012 45.44 74.18 61.82
2013 46.51 75.94 63.28
2014 47.62 77.74 64.78
2015 48.75 79.59 66.32
2016 49.91 81.48 67.90
2017 51.09 83.42 69.52
2018 52.31 85.41 71.17
2019 53.56 87.45 72.87
2020 54.84 89.53 74.61
2021 56.15 91.68 76.40
2022 57.50 93.87 78.23
2023 58.87 96.12 80.10
2024 60.29 98.43 82.02
2025 61.73 100.79 83.99
2026 63.22 103.21 86.01
2027 64.74 105.69 88.08
2028 66.30 108.24 90.20
2029 67.89 110.85 92.37
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2030 69.53 113.52 94.60
2031 71.21 116.26 96.89
2032 72.59 118.51 98.76
2033 73.99 120.80 100.67
2034 75.42 123.14 102.62
2035 76.89 125.53 104.61
2036 78.38 127.96 106.63
7.2 Light Load Purchase Price - For all Net Energy received durng Light Load Hours, Idaho Power
wil pay the non-levelized energy price as specified below:
Season 1 - (73.50 %)Season 2 - (120.00 %)Season 3 - (100.00 %)
Year Mils/Kwh Mils/Kwh Mills/Kwh
2011 39.04 63.73 53.11
2012 40.09 65.45 54.54
2013 41.16 67.20 56.00
2014 42.27 69.00 57.50
2015 43.40 70.85 59.04
2016 44.56 72.74 60.62
2017 45.74 74.68 62.24
2018 46.96 76.67 63.89
2019 48.21 78.71 65.59
2020 49.49 80.80 67.33
2021 50.80 82.94 69.12
2022 52.14 85.13 70.95
2023 53.52 87.38 72.82
2024 54.94 89.69 74.74
2025 56.38 92.05 76.71
2026 57.87 94.48 78.73
2027 59.39 96.96 80.80
2028 60.95 99.50 82.92
2029 62.54 102.11 85.09
2030 64.18 104.79 87.32
2031 65.86 107.53 89.16
2032 67.24 109.78 91.48
2033 68.64 112.07 93.39
2034 70.07 114.41 95.34
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2035 71.53 116.79 97.33
2036 73.02 119.22 99.35
7.3 All Hours Energy Price - The price to be used in the calculation of the Test Energy Price and
Availability Shortfall Price shall be the non-levelized energy price as specified below:
Season 1 - (73.50 %)Season 2 - (120.00 %)Season 3 - (100.00 %)
Year Mils/Kwh Mils/Kwh Mils/Kwh
2011 42.01 68.58 57.15
2012 43.06 70.29 58.58
2013 44.13 72.05 60.04
2014 45.24 73.85 61.54
2015 46.37 75.70 63.08
2016 47.53 77.59 64.66
2017 48.71 79.53 66.28
2018 49.93 81.52 67.93
2019 51.18 83.56 69.63
2020 52.46 85.65 71.37
2021 53.77 87.79 73.16
2022 55.11 89.98 74.99
2023 56.49 92.23 76.86
2024 57.90 94.54 78.78
2025 59.35 96.90 80.75
2026 60.84 99.32 82.77
2027 62.36 101.81 84.84
2028 63.92 104.35 86.96
2029 65.51 106.96 89.13
2030 67.15 109.64 91.36
2031 68.83 112.38 93.65
2032 70.21 114.62 95.52
2033 71.61 116.92 97.43
2034 73.04 119.25 99.38
2035 74.50 121.64 101.37
2036 75.99 124.07 103.39
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7.4 Test Energy Price - For all Test Energy, Idaho Power shall pay to the Seller the curent month's
Market Energy Reference Price or the All Hours Energy Price specified in paragraph 7.3,
whichever is lower.
7.5 Payment Due Date - Undisputed Energy payments, less the Wind Energy Production Forecasting
Monthly Cost Allocation and any other payments due Idaho Power, wil be disbursed to the Seller
within 10 days of the date which Idao Power receives the documentation of the monthly Net
Energy actually delivered to Idaho Power as specified in Appendix A.
7.6 Continuing Jurisdiction of the Commission - This Agreement is a special contract and, as such, the
rates, terms and conditions contained in this Agreement will be construed in accordace with
Idaho Power Company v. Idaho Public Utilties Commission and Afton Energy, Inc., 107 Idaho
781,693 P.2d427 (1984) (Afton rrn, Afton Energy, Inc. v. Idaho Power Company, 111 Idaho 925,
729 P.2d 400 (1986), Arkoosh v. Idaho Power Company, Idao Public Utilties Commssion Order
No. 19442 (Feb. 8, 1985), Idaho Power Company v. Idaho Public Utilties Commssion, 107 Idao
1122,695 P.2d 1261 (1985), Section 210 ofthe Public Utilities Regulatory Policies Act of 1978
and 18 CFR §292.303-308.
ARTICLE VII: ENVIRONMENTAL ATTRIUTES
8.1 Seller retains ownership under this Agreement of the Environmental Attributes directly associated
with the production of energy from the Seller's Facility sold to Idaho Power through the last day of
calendar year 2021.
8.2 Idao Power shall be granted ownership under this Agreement of Environmental Attbutes directly
associated with the production of energy from the Seller's Facility sold to Idaho Power staring with
the first hour of the first day of calendar year 2022 and through the end of the Term of this
Agreement.
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ARTICLE IX: FACILITY, INERCONNCTION AN WIN FORECASTING DATA
9.1 Design of Facility - Seller wil design, construct, install, own, operate and maintain the Facilty and
any Seller-owned Interconnection Facilties so as to allow safe and reliable generation and delivery
of Net Energy to the Idao Power Point of Delivery for the full term of the Agreement.
9.2 Interconnection Facilities - Except as specifically provided for in this Agreement, the required
Interconnection Facilities wil be determined in accordance with Seller's interconnection
agreement. Responsibility for all costs associated with this equipment wil be set forth in Seller's
interconnection agreement.
9.3 Wind data
9.3.1 Historical wind data - Withn 60 days after Commission approval of this Agreement, the
Seller shall provide Idao Power with seven years of historical wind data from the
meteorological towers at the Rockland site. This data will be provided in an electronic
format reasonably acceptable to Idaho Power.
9.3.2 No later than 30 days prior to the First Energy Date the Seller shall have erected at the site
two (2) high quality, hub-height, permanent, meteorological wind measurement towers at
locations on the site equipped with:
(i) Two (2) heated anemometers per tower;
(ii) Two (2) air temperature sensors per tower;
(iii) One (1) barometric pressure sensor (with DCP sensor); and
(iv) Two (2) heated wind vanes per tower.
9.3.3 The wind sensors and air temperature sensors shall be set at two (2) height locations from
ground leveL. All equipment shall provide reasonably accurate measurement of wind data.
The Seller wil install the necessar equipment to be able to electronically trasmit this
wind data and wind tubine availabilty status real-time to Idao Power or a designee of
Idaho Power in a method and form reasonably acceptable to Idaho Power and in
accordace with Prudent Electrical Practices. Turbine availabilty status shall be
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transmitted beginnng 45 days after First Energy Date. Failure by the Seller to operate and
maintain this equipment in a maner to provide reasonably accurate and dependable data
for the full term of this Agreement shall be an event of default.
9.3.4 Seller shall submit to Idaho Power Seller's technical specifications for the meteorological
towers along with a site plan showing the location of the towers, project layout with turbine
locations and the wind rose for the Site, as applicable.
ARTICLE X: METERIG AN TELEMETRY
10.1 Metering - Idaho Power shall, for the account of Seller, provide, install, and maintain metering and
telemetry equipment to be located at a mutually agreed upon location to record and measure power
flows to Idaho Power in accordance with this Agreement and Seller's interconnection agreement.
The meterig equipment wil be at the location and of the type required to measure, record and
report the Facility's Net Energy, Station Use, and maximum energy deliveries (kW) at the Point of
Delivery in a maner to provide Idao Power adequate energy measurement data to admnister this
Agreement and to integrate this Facility's energy production into the Idaho Power electrical
system.
10.2 Telemetry - Idaho Power wil install, operate and maintain at Seller's expense metering,
communications and telemetry equipment which wil be capable of providing Idaho Power with
continuous instantaneous telemetry of Seller's Net Energy produced and delivered to the
Idaho Power Point of Delivery to Idaho Power's Designated Dispatch Facilty.
ARTICLE XI - RECORDS
11.1 Maintenance of Records - Seller shall maintain at the Facility or such other location mutually
acceptable to the Paries adequate total generation, Net Energy, Station Use, and maximum
generation (kW) records in a form and content reasonably acceptable to Idaho Power and Prudent
Electrical Practices.
11.2 Inspection - Either Pary, after reasonable notice to the other Pary, shall have the right, durg
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normal business hours, to inspect and audit any or all generation, Net Energy, Station Use, and
maximum generation (kW) records pertaining to the Seller's Facilty.
ARTICLE XII: OPERATIONS
12.1 Communications - Idaho Power and the Seller shall maintain appropriate operating
communications through Idaho Power's Designated Dispatch Facilty in accordace with
Appendix A of this Agreement.
12.2 Energy Acceptance-
12.2.1 Idaho Power shall be excused from accepting and paying for Net 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, an Idao Power
Forced Outage or temporar disconnection of the Facility in accordace with Seller's
interconnection agreement. If, for reasons other than an event of Force Majeure,
temporar disconnections under Seller's interconnection agreement exceed twenty (20)
days in the aggregate in any Contract Year, begining with the twenty-first day of such
interrption, curtailment or reduction, Seller wil be deemed to be deliverig Net Energy at
a rate equivalent to the pro rata daily average of the amounts specified for the applicable
month in paragraph 6.4, and Idaho Power wil pay Seller the sum of the applicable energy
price in paragraph 7.1 or 7.2, plus the Environmental Attribute Replacement Value (if such
curtailment occurs prior to Januar 1, 2022), plus the PTC Value for each MWh of deemed
delivered Net Energy. Idaho Power wil notify Seller when the interption, curilment or
reduction is terminated.
12.2.2 If, pursuant to Prudent Electrical Practices, Seller's operation of the Facilty or
Interconnection Facilities is unsafe or may otherwise adversely affect Idao Power's
equipment, personnel or servce to its customers, Idaho Power may temporarly disconnect
the Facility from Idaho Power's transmission/distribution system as specified withi
Seller's interconnection agreement or take such other reasonable steps as Idaho Power
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deems appropriate in accordance with Prudent Electrcal Practices. If a disconnection
occurs as specified in ths pargraph 12.2.2, Idaho Power wil not be responsible for
payments to the Seller for any energy, Environmental Attribute Replacement Value or PTC
Value associated with this disconnection.
12.2.3 Under no circumstances wil the Seller deliver Net Energy from the Facility to the Point of
Delivery on an instantaneous basis in an amount that exceeds the Maxium Capacity
Amount. Seller's failure to limt instantaneous deliveries to the Maximum Capacity
Amount wil be a Material Breach of this Agreement if Seller does not reduce the output of
the Facilty to less than the Maximum Capacity Amount as soon as practicable after receipt
of written notice from Idaho Power. Seller shall be responsible for any costs Idaho Power
incurs as a result of the Seller deliverig Net Energy to Idao Power that exceeds the
Maximum Capacity Amount.
12.2.4 If Idaho Power is unable to accept the energy from this Facilty and is not excused from
accepting the Facility's energy, Idaho Power shall pay Seller the sum of the applicable
energy price in paragraph 7.1 or 7.2, plus the Environmental Attribute Replacement Value
(if such curailment occurs prior to Januar 1, 2022), plus the PTC Value for each MWh of
the estimated energy that Idaho Power was unable to accept, which shall be estimated to
have been delivered at a rate equivalent to the pro rata average of the amounts specified for
the applicable month in paragraph 6.4. Except as set forth in the preceding sentence,
Idaho Power wil have no responsibilty to pay for any other costs, lost revenue or
consequential damages the Facility may incur.
12.3 Scheduled Maintenance - On or before Januar 31 of each calendar year, Seller shall submit a
written proposed maintenance schedule of significant Facility maintenance for that calenda year to
Idao Power.
12.3.1 Seller shall not schedule planed maintenance requirg the removal from servce of more
than ten percent (10%) of the wind tubine generators comprising the Facility at anyone
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time durg the months of July, August, November, or December.
12.3.2 Idao Power shall promptly respond with acceptance of the proposed planed maintenance
schedule or with suggested changes to the proposed planed maintenance schedule. If
Idaho Power does not respond within 5 Business Days the Seller's proposed planed
maintenance schedule wil be deemed to be accepted. If Idao Power proposes chages to
the Seller provided planed maintenance schedule the Paries shall cooperate to mutually
agree on a planed maintenance schedule. If the Paries are unable to agree on a revised
planed maintenance schedule, the Seller's provided planed maintenance schedule wil
be in effect. Nothing in this pargraph 12.4 shall preclude Seller from performing
maintenance on the Facility required by Prudent Electrcal Practices, equipment
waranties, or manufacturer or supplier guidelines.
12.4 Maintenance Coordination - The Seller and Idaho Power shall, to the extent practical, coordinate
their respective line and Facilty maintenance schedules such that they occur simultaneously.
12.5 Contact Prior to Curtailment - Idao Power will make a reasonable attempt to contact the Seller
prior to exercising its rights to interrpt the interconnection or curtail deliveries from the Seller's
Facilty. Seller understands that in the case of emergency circumstances Idaho Power may not be
able to provide notice to the Seller prior to interrption, curailment, or reduction of electrical
energy deliveries to Idaho Power.
12.6 Replacement of Facilties. Seller may alter, modify, maintain, repair, or replace the assets
comprising the Facility, including the replacement of wind turbine generators, without
Idaho Power's consent under this Agreement, provided that the Nameplate Capacity of the Facility
may not exceed the Maximum Capacity Amount and the changes are in compliance with Seller's
interconnection agreement.
ARTICLE XII: INEMNIICATION AN INSURNCE
13.1 Indemnification - Each Party shall agree to hold haress and to indemnify the other Pary, its
offcers, agents, affliates, subsidiares, parent company and employees againt all loss, damage,
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expense and liabilty to third persons for injur to or death of person or injur to property,
proximately caused by the indemnifyng Pary's (a) construction, ownership, operation or
maintenance of, or by failure of, any of such Pary's works or facilities used in connection with this
Agreement or (b) negligent or intentional acts, errors or omissions, but excluding any loss, damage,
expense or liabilty caused solely by the gross negligence or wilful misconduct of the Pary
seekig indemnity. The indemnifying Party shall, on the other Pary's request, defend any suit
asserting a claim covered by this indemnty. The indemnifyng Pary shall pay all documented
costs, including reasonable attorney fees that may be incurred by the other Pary in enforcing this
indemnity.
13.2 Insurance - Durng the term of this Agreement, Seller shall secure and continuously car the
following insurnce coverage:
13.2.1 Comprehensive General Liabilty Insurance for both bodily injur and property damage
with limits equal to $1,000,000, each occurrence, combined single limit. The deductible for
such insurance shall be consistent with current Insurce Industry Utility practices for
simlar property.
13.2.2 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:
(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.
13.3 Certificates of Insurance - As required in paragraph 4.1.6 herein and anually thereafter, Seller
shall fush to Idaho Power a certificate of insurance, together with the endorsements required
therein, evidencing the coverage as set forth above.
13.4 Notification of Loss of Coverage - Ifthe insurance coverage required by paragraph 13.2 sha1llapse
for any reason, the Seller wil immediately notify the other Pary in writing. The notice wil advise
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of the specific reason for the lapse and the steps being taken to reinstate the coverage. Failure to
provide this notice and to expeditiously reinstate or replace the coverage wil constitute a Material
Breach of this Agreement if not cured within fifteen (15) days after lapse of such insurce.
ARTICLE XIV: FORCE MAJEUR
14.1 As used in this Agreement, "Force Majeure" or "an event of Force Majeure" means any cause
beyond the reasonable control of the Seller or of Idaho Power which, despite the exercise of due
dilgence, such Pary is unable to prevent or overcome. Force Majeure includes, but is not limited
to, acts of God, fire, flood, storms, wars, hostilties, civil strife, strikes and other labor distubances,
earthquakes, fires, lightning, epidemics, sabotage, changes in law or regulation occurg after the
Effective Date or Seral Defects which, by the exercise of reasonable foresight such Party could not
reasonably have been expected to avoid and by the exercise of due diligence, it is unable to
overcome. If either Pary is rendered wholly or in par unable to perform or delayed in performing
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:
(l) The non-performing Pary shall, as soon as is reasonably possible after the
occurrence of the Force Majeure or the date when it should have reasonably
become aware that an event has given rise to a Force Majeure, give the other Pary
written notice describing the paricular of the occurence.
(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 Pary 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 occurrence.
(4) Neither Pary shall be excused from the obligation to make payment for amounts
due in respect of performance rendered prior to the event of Force Majeure.
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ARTICLE XV: LIAILITY; DEDICATION
15.1 Limitation of Liabilty. 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 Pary to this Agreement.
Neither Pary shall be liable to the other for any indirect, special, consequential, nor puntive
damages, except as expressly authorized by this Agreement.
15.2 Dedication. No undertakng by one Part to the other under any provision of this Agreement
shall constitute the dedication of that 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 XVI: SEVERA OBLIGATIONS
16.1 Except where specifically stated in this Agreement to be otherwise, the duties, obligations and
liabilities of the Paries are intended to be several and not joint or collective. Nothig contained in
this Agreement shall ever be construed to create an association, trust, parnership or joint venture
or impose a trust or partnership duty, obligation or liabilty on or with regard to either Party. Each
Party shall be individually and severally liable for its own obligations under this Agreement.
ARTICLE XVII: WAIER
17.1 Any waiver at any time by either Pary of its rights with respect to a default under this Agreement or
with respect to any other matters arsing 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
18.1 This Agreement shall be construed and interpreted in accordace with the laws of the State ofIdaho
without reference to its choice of law provisions.
18.2 Venue for any litigation arsing out of or related to this Agreement wil lie in the Distrct Cour of
the Four Judicial District ofIdaho in and for the County of Ada.
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ARTICLE XIX: DISPUTES AN DEFAULT
19.1 Disputes - All disputes related to or arising under this Agreement, including, but not limited to, the
interpretation of the terms and conditions of this Agreement, wil be submitted for resolution as set
forth in this pargrph.
19.1.1 Ifa dispute arises under this Agreement (a "Dispute"), within ten (10) days following the
delivered date of a written request by either Pary (a "Dispute Notice"), (i) each Pary shall
appoint a representative, and (ii) the Paries' reresentatives shall meet, negotiate and
attempt in good faith to resolve the Dispute quickly, informally and inexpensively. If the
Paries' representatives cannot resolve the Dispute within thirty (30) days after
commencement of negotiations, then withi ten (10) Business Days following any request
by either Pary at any time thereafter, each Pary representative (A) shall independently
prepare a written sumar of the Dispute describing the issues and claims, (B) shall
exchange its summary with the sumar of the Dispute prepared by the other Pary
representative, and (C) shall submit a copy of both summaries to a senior offcer of the
representative's Pary with authority to irevocably bind the Pary to a resolution of the
Dispute. Within ten (10) Business Days after receipt ofthe Dispute sumaries, the senior
officers for both Paries shall negotiate in good faith to resolve the Dispute. If the Paries
are unable to resolve the Dispute within foureen (14) Business Days following receipt of
the Dispute summares by the senior offcers, either Pary may seek available remedies.
19.2 Notice of Default
19.2.1 Defaults. If either Pary fails to perform or maintain any of the terms or conditions of
this Agreement (an "event of default"), the non-defaulting Party shall cause notice in
writing to be given to the defaulting Pary, specifyng the maner in which such default
occured. If the defaulting Pary shall fail to cure such default within the sixty (60) days
after service of such notice, or if the defaulting Pary reasonably demonstrates to the
non-defaulting Pary that the default can be cured within a commercially reasonable
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time but not within such sixty (60) day period and then fails to dilgently pursue such
cure, then, the non-defaulting Party may, at its option, termnate this Agreement and/or
pursue its legal or equitable remedies. Notwithstanding anything to the contrar in this
paragraph 19.2.1, Idaho Power's unexcused failure to accept energy from this Facility
wil not be deemed an event of default so long as Idao Power continues to comply fully
with its obligations to compensate Seller pursuant to paragraphs 12.2.1 and 12.2.4.
Material Breaches - The notice and cure provisions in paragraph 19.2.1 do not apply to
defaults identified in this Agreement as Material Breaches. Without limiting any
express cure periods provided in this Agreement, Material Breaches must be cured as
expeditiously as possible following occurence of the breach and, in any case, once
cured shall no longer be cause for termination under this Agreement.
19.3 Securty for Performance - Prior to the Operation Date and thereafter for the full term of this
Agreement, Seller wil provide Idao Power with the following:
19.3.1 Insurance - Evidence of compliance with the provisions of paragraph 13.2. If Seller
fails to comply, such failure wil be a Material Breach and may only be cured by Seller
supplyig evidence that the required insurance coverage has been replaced or
reinstated, which evidence must be supplied within fifteen (15) days after wrtten notice
from Idaho Power;
19.3.2 Engineer's Certifications - Every three (3) years after the Operation Date, Seller wil
supply Idaho Power with a Certification of Ongoing Operations and Maintenance
(O&M) from a Registered Professional Engineer licensed in the State of Idao, which
Certification of Ongoing 0 & M shall be in the form specified in Appendix C. Seller's
failure to supply the requied certificate wil be an event of default. Such a default may
only be cured by Seller providing the required cerificate; and
19.3.3 Licenses and Permits - Dung the full term of this Agreement, Seller shall maintai
material compliance with all permits and licenses described in pargrph 4.1.1 of this
19.2.2
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Agreement. In addition, Seller wil supply Idaho Power with copies of any new or
additional perits 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 permits 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 Idao Power evidence of compliance from
the permitting agency.
19.3.4 Securty Reguirements - From the Operation Date until the termation or expiration of
this Agreement, Seller shall maintain compliance with the securty requirements
specified in pargraph 5.3(e) of this Agreement.
ARTICLE XX: GOVERNENTAL AUTHORIATION
20.1 This Agreement is subject to the jursdiction of those governental agencies having control over
either Pary of ths Agreement; it being acknowledged that Seller is not a "public utility" regulated
by the Commssion.
ARTICLE XXI: COMMISSION ORDER
21.1 This Agreement shall become finally effective upon the Commission's approval of all terms and
provisions hereof without change or condition and declaration that all payments to be made to
Seller hereunder shall be allowed as prudently incured expenses for ratemaking purposes.
21.2 Idao Power shall fie this Agreement for Commission Approval withi fifteen (15) days after the
Effective Date. In the event that Commission approval pursuant to pargraph 21.1 has not been
received within ninety (90) days after the date on which Idao Power fies ths Agreement for
Commission Approval, then Seller shall have the right to terminate this Agreement, without
liabilty to Idaho Power, effective upon written notice to Idaho Power.
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ARTICLE XXII: SUCCESSORS AN ASSIGNS
22.1 This Agreement and all of the terms and provisions hereof shall be bindig 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 Paries being first
obtained. Such consent shall not be uneasonably withheld. Notwithstandig the foregoing, any
party which Idao Power may consolidate, or into which it may merge, or to which it may convey
or transfer substantially all of its electrc utilty assets, shall automatically, without fuher act, and
without need of consent or approval by the Seller, succeed to all of Idao Power's rights,
obligations and interests under this Agreement. Notwithstanding the foregoing, Seller may
transfer, sell, pledge, encumber, or assign this Agreement or the accounts, revenues or proceeds
hereof to its financing providers without obtaining Idaho Power's consent. Upon Seller's request
and expense, Idaho Power shall in good faith negotiate and agree upon a consent to collateral
assignent of this Agreement in a form that is commercially reasonable and customar in the
industry. This aricle shall not prevent a financing entity with recorded or secured rights from
exercising all rights and remedies available to it under law or contract. Idao Power shall have the
right to be notified by the financing entity that it is exercising such rights or remedies.
22.2 Right of First Offer upon Sale of Facilty Assets, increase of existing Facility Nameplate rating, or
expansion ofthe Facilty.
22.2.1 Facility Assets. If, at any time during the Term, Seller intends to sell the assets comprising
all or substantially all of the Facilty (the "Facility Assets") or more tha fifty percent
(50%) of the Seller's direct ownership to a person or entity that is not an Affiliate of Seller,
Seller shall first offer the Facility Assets to Idaho Power. Seller's offer to Idaho Power
shall set forth, in writing and in reasonable detail, substantially similar terms and
conditions of the offer being proposed by the Seller to the other person or entity. Seller
shall promptly answer any questions that Idao Power may have concerning the offered
terms and conditions and shall meet with Idao Power to discuss the offer.
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22.2.2 Idao Power's Rejection of Offer; Revival of Offer. If Idaho Power does not provide
written notice of its intent to accept the offered terms and conditions withi thi (30) days
after receiving each of the Seller's offers made under 22.2.1, Seller may in its sole
discretion enter into an agreement to sell the Facilty Assets to a third pary in compliance
with the requirements of this Aricle 22 and on terms and conditions satisfactory to Seller
in its sole discretion. Seller may elect not to proceed with the sale of the Facility Assets.
Idao Power and Seller may mutually agree to continue negotiations beyond the timeline
specified.
22.2.3 Idaho Power's Acceptance of Offer. IfIdaho Power provides written notice of its intent to
accept the offer made by Seller under this pargraph 22.2, the Paries shall negotiate in
good faith to enter into a definitive sales agreement that incorporates the ters and
conditions of Seller's offer. The definitive agreement shall be subject to each Pary's
regulatory approvals. If within sixty (60) days of Idao Power's acceptance of the offer, a
definitive sales agreement has not been executed by an offcer of the Idaho Power and
Seller, then either Pary may termate the negotiations without fuher obligation to the
other Pary, and Seller may in its sole discretion enter into an agreement to sell the Facility
Assets to a third pary.
22.2.4 Right of First Offer of expansion of this Facility. If at the time of development of this
Facilty or at any future date, the Seller proposes to increase the nameplate rating of this
Facility or add additional electrical generation at this site, the Seller shall first offer the
additional electrcal generation to Idaho Power as an amendment to this Agreement, as a
separately negotiated purchase power agreement, or whole or parial ownerhip of the
Facilty or the additional generation facilities. This offer from the Seller shall include but
not be limited to proposed capacity, energy pricing, contract term, online date and other
information that wil enable Idaho Power to be able to evaluate Idaho Power's interest in
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this additional electrical generation. Upon receipt of the Seller's offer (containing
reasonably adequate information) Idaho Power shall have thiry (30) days to respond to
Seller's offer of Idaho Power's intent to continue negotiations for this additional electrical
generation. If Idao Power provides notice that Idaho Power has no curent intention to
continue negotiations the Seller may pursue other opportunities with other paries for the
development and sale of this additional electrical generation. If Idaho Power provides
notice to the Seller of the desire to continue negotiations Idaho Power and Seller shall
commence good faith negotiations of an amendment to this Agreement and/or a separate
agreement. If after sixty (60) days of good faith negotiations, an agreement is not
completed, the Seller may provide notice to Idao Power of its intention to pursue
opportnities with other paries. By mutual consent, this sixty (60) day negotiation period
may be extended.
ARTICLE XXil: MODIFICATION
23.1 No modification to this Agreement shall be valid unless it is in writing and signed by both Paries
and, if such modification is material, subsequently approved by the Commission.
ARTICLE XXIV: TAXES
24.1 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 XXV: NOTICES
25.1 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:
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To Seller:
Original document to:
Ridgeline Energy LLC
1300 N. Northlake Way, 2nd Floor
Seattle, W A 98103
Attention: Dennis P. Meany, President
Phone: [phone]
e-mail: dmeany(fel-en.com
Copy of document to:
Ridgeline Energy LLC
1300 N. Northlake Way, 2nd Floor
Seattle, WA 98103
Attention: Joan E. Hutchison,
Vice President Origination and Marketing
Phone: [phone]
e-mail: jhutchinson(frl-en.com
To Idaho Power:
Original document to:
Senior Vice President, Power Supply
Idaho Power Company
POBox 70
Boise, Idaho 83707
Email: LGgrow(fidahopower.com
Copy of document to:
Cogeneration and Small Power Production
Idao Power Company
POBox 70
Boise, Idao 83707
E-mail: rallphinVAidaopower.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.
ARTICLE XXVI: ADDITIONAL TERMS AN CONDITIONS
26.1 Equal Employment. During performance pursuant to this Agreement, Seller agrees to comply with
all applicable equal employment opportity, small business, and affirmative action laws and
regulations. All Equal Employment Opportnity and affirmative action laws and regulations are
hereby incorprated by this reference, including provisions of 38 U.S.C. § 4212, Executive Order
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11246, as amended, and any subsequent executive orders or other laws or regulations relating to
equal opportity for employment on governent contracts. To the extent this Agreement is
covered by Executive Order 11246, the Equal Opportity Clauses contained in 41 C.F.R. 60-1.4,
41 C.F.R. 60-250.5, and 41 CFR 60-741.5 are incorporated herein by reference. (Reserved for
review and comment by Seller)
26.2 This Agreement includes the following appendices, which are attached hereto and included
by reference:
Appendix A
AppendixB
AppendixC
AppendixD
AppendixE
AppendixF
AppendixG
Monthly Power Production and Availability Report
Facility and Point of Delivery
Engineer's Certifications
Forms of Liquid Securty
Wind Energy Production Forecasting
Form of Letter of Credit
Sample Shortfall Damages Calculation
ARTICLE XXVII: SEVERAILITY
27.1 The invalidity or unenforceabilty of any ter or provision of this Agreement shall not affect the
validity or enforceability of any other terms or provisions and ths Agreement shall be construed in
all other respects as if the invalid or unenforceable term or provision were omitted.
ARTICLE XXVII: COUNERPARTS
28.1 This Agreement may be executed in two or more counterpars, each of which shall be deemed an
original but all of which together shall constitute one and the same instruent.
ARTICLE XXIX: ENTIR AGREEMENT
29.1 This Agreement constitutes the entire Agreement of the Paries concerning the subject matter
hereof and supersedes all prior or contemporaneous oral or written agreements between the Paries
concerning the subject matter hereof.
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By
Dated
IN WITSS WHEREOF, The Paries hereto have caused this Agreement to be executed
in their respective names on the dates set forth below:
Idaho Power Company
Lisa A. Grow
Sr. Vice President, Power Supply
Q,3'IO
"Idaho Power"
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By
Dated
Rockland Wind Project LLC
~Mh
President
7ó/?O,1)"Seller"
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APPENDIX A
A-I MONTHLY POWER PRODUCTION AN AVAIABILITY REPORT
At the end of each month the following required 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 Facilty's total energy production delivered to the Delivery Point and Station Usage 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
Idao 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:
This report shall also include the Seller's calculation of the Mechanical Availabilty.
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Idaho Power Company
Cogeneration and Small Power Production
MONTHLY POWER PRODUCTION AN AVAIABILITY REPORT
Month Year
Project Name Project Number:
Address Phone Number:
City State Zip
Net Facilty
Output
Station
Usage
Station
Usage
Metered
Maximum Generation
Meter Number:
End of Month kWh Meter Reading:
Beginning of Month kWh Meter:
Difference:
Times Meter Constant:
kW
Net Generation
kWh for the Month:
Metered Demand:
Mechanical Availabilty Guarantee
Seller Calculated Mechanical Availabilty
As specifed in this Agreement, the Seller shall include with this monthly report a summary statement of the
Mechanical Availabilty oHhis Facilty for the calendar month. This summary shall include details as to how
the Seller calculated this value and summary of the Facilty data used in the calculation. Idaho Power and the
Seller shall work together to mutually develop a summary report that provides the required data.
Idaho Power reserves the right to review the detailed data used in this calculation as allowed within the
Agreement.
Signature Date
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A-2 AUTOMATED METER READING COLLECTION PROCESS
Monthly, Idaho Power will use the provided Metering and Telemetry equipment and processes to collect
the meter reading information from the Idao Power provided Meterng Equipment that measures the Net
Energy and energy delivered to supply Station Use for the Facilty recorded at 12:00 AM (Midnight) of the
last day of the month.
The meter information 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
maner for a reasonable period of time, the Paries may mutually agree to modify this Routine
Reporting requirement.
Idao Power Contact Information
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
. Current Meter Reading
. Estimated Generation for the current day
. Estimated Generation for the next day
Planed and Unplaned Project outages
Call 1-800-345-1319 and leave the following information:
. Project Identification - Project Name and Project Number
· Approximate time outage occurred
. Estimated day and time of project coming back online
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Seller's Contact Information
24-Hour Project Operational Contact
Name:
Telephone Number:
Cell Phone:
Project On-site Contact information
Telephone Number:
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APPENDIXB
ROCKLAN WIN PROJECT
PROJECT NO. 41455300
B-1 DESCRITION OF FACILITY
(Must include the nameplate rating and V AR capabilty (both leading and lagging) of all generation units to
be included in the Facilty.)
Rockland Wind Project wil be comprised of 44 Vestas VlOO turbines for a total nameplate rating
of79.2 MW. Each tubine is rated at 1.8 MW and has .95 lead /.90 lag power factor. Turbine
selection has not been finalized and the final Facilty Description is subject to change based on
actual turbine selection.
B-2 LOCATION OF FACILITY
Near: American Falls, Idaho
T7S R31E sec 31
T8S R30E sec 13, 24, 23-28, 33-36
T8S R31E sec 6, 7, 16, 19,30,31
T9S R30E sec 1-5,9-12
County: Power County, ID.
Description of Interconnection Location: The Facility wil interconnect to the Idaho Power
transmission system at 138 kV at the project bounda in Section 36, Township 8 South, Range 30
East - to be defined in the interconnection agreement.
Nearest Idao Power Substation: Brady Substation in American Falls.
B-3 SCHEDULED FIRST ENERGY AN OPERATION DATE
Seller has selected July 15,2011 as the Scheduled First Energy Date.
Seller has selected December 31,2011 as the Scheduled Operation Date.
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In making these selections, Seller recognizes that adequate testing of the Facility and completion of
all requirements in paragraph 5.3 of this Agreement must be completed prior to the project being
granted an Operation Date.
B-4 MAXIMUM CAPACITY AMOUN
This value wil be 80 MW which is consistent with the value provided by the Seller to Idao Power
in accordace with Seller's interconnection agreement. Ths value is the maximum energy (MW)
that potentially could be delivered by the Seller's Facilty to the Idaho Power electrical system at
any moment in time.
B-5 POIN OF DELIVERY
"Point of Delivery" means, unless otherwise agreed by both Paries, the point of where the Seller's
Facilty's energy is delivered to the Idao Power electrcal system. Seller's interconnection
agreement wil determine the specific Point of Delivery for this Facility. The Point of Delivery
identified by Seller's interconnection agreement will become an integral par of this Agreement.
B-6 LOSSES
If the Idaho Power Metering equipment is capable of measurng 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 Facilty and the Idao Power
Point of Delivery. This loss calculation wil be initially set at 2% of the kWh energy production
recorded on the Facility generation meterig 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 Facilty and the Idao Power
electrical system, Idaho Power wil configure a revised loss calculation formula to be agreed to by
both Parties and used to calculate the kWh Losses for the remainig ter of the Agreement. If at
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any time durng the term of this Agreement, Idao Power determines that the loss calculation does
not correctly reflect the actual kWh losses attributed to the electrical equipment between the
Facility and the Idaho Power electrical system, Idaho Power may adjust the calculation and
retroactively adjust the previous month's kWh loss calculations.
B-7 METERIG AN TELEMETRY
Seller's interconnection agreement wil determine the specific metering and telemetry
requirements for this Facility. At the minimum the Metering Equipment and Telemetry equipment
must be able to provide and record hourly energy deliveries to the Point of Delivery and any other
energy measurements required to administer this Agreement. These specifications wil include but
not be limited to equipment specifications, equipment location, Idaho Power provided equipment,
Seller provided equipment, and all costs associated with the equipment, design and installation of
the Idao Power provided equipment. Seller wil arange for and make available at Seller's cost
communication circuit(s) compatible with Idaho Power's communications equipment and
dedicated to Idaho Power's use terminating at the Idaho Power facilities capable of providing
Idaho Power with continuous instantaneous information on the Facilities energy production.
Idao Power provided equipment wil be owned and maintained by Idaho Power, with total cost of
purchase, installation, operation, and maintenance, including administrative cost to be reimbursed
to Idao Power by the Seller. Payment of these costs wil be in accordace with Seller's
interconnection agreement and the total meterig cost wil be included in the calculation of the
Monthly Operation and Maintenance Charges specified in Seller's interconnection agreement.
B-8 NETWORK RESOURCE DESIGNATION
Idao Power canot accept or pay for generation from this Facilty until a Network Resource
Designation ("NR") application has been accepted by Idaho Power's delivery business unt.
Federal Energy Regulatory Commission ("FERC") Rules require Idao Power to prepar and
submit the NR. Because much of the information Idao Power needs to prepare the NR is
specific to the Seller's Facility, Idaho Power's abilty to fie the NR in a timely maner is
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contingent upon timely receipt of the required information from the Seller. Prior to Idao Power
beginnng the process to enable Idaho Power to submit a request for NR status for this Facilty,
the Seller shall have completed all requirements as specified in Pargraph 5.7 of this Agreement.
Seller's failure to provide complete and accurate information in a timely manner can
significantly impact Idaho Power's abilty and cost to attain the NRD designation for the
Seller's Facilty and the Seller shall bear the costs of any of these delays that are a result of
any action or inaction by the Seller.
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APPENDIXC
ENGINER'S CERTIFICATION
OF
OPERATIONS & MAIENANCE POLICY
The undersigned , on behalf of himself and
hereinafter collectively refered 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 of Idaho.
2. That Engineer has reviewed the Firm Energy Sales Agreement, hereinafter "Agreement," between
Idaho Power as Buyer, and as Seller, dated
3. That the wind energy power production project which is the subject of the Agreement and this
Statement is identified as IPCo Facilty 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, Idao.
5. That Engineer recognizes that the Agreement provides for the Project to furnish electrical energy to
Idao Power for a twenty-five (25) year period.
6. That Engineer has substantial experience in the design, construction and operation of electrc
power plants of the same type as this Project.
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 opinon that, provided said Project has been
designed and built to appropriate standards and assuming Suffcient Prime Mover, adherence to said O&M
Policy wil result in the Project's producing at or near the design electrcal output, efficiency and plant
factor for a twenty (20) year period.
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9. That Engineer recognizes that Idaho Power, in accordace with paragraph 5.3 of the Agreement, is
relying on Engineer's representations and opinons 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
ENGINER'S CERTIFICATION
OF
ONGOING OPERATIONS AN MAIENANCE
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 Engineer in good standing in the State ofIdaho.
2. That Engineer has reviewed the Fir Energy Sales Agreement, hereinafter "Agreement," between
Idaho Power as Buyer, and as Seller, dated
3. That the wind energy power production project which is the subject of the Agreement and this
Statement is identified as IPCo Facilty 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, Idaho.
5. That Engineer recognzes that the Agreement provides for the Project to fush electrical energy to
Idaho Power for a twenty-five (25) year period.
6. That Engineer has substantial experience in the design, construction and operation of electrc
power plants of the same type as this Project.
7. That Engineer has no economic relationship to the Design Engineer of this Project.
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 wi(h 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.
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9. That Engineer recognzes that Idaho Power, in accordance with paragraph 5.3 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
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 Idao Power as follows:
1.
2.
That Engineer is a Licensed Professional Engineer in good standig in the State ofIdaho.
That Engineer has reviewed the Fir Energy Sales Agreement, hereinafter "Agreement",
between Idaho Power as Buyer, and as Seller, dated
3.That the wind energy power production project, which is the subject of the Agreement and
this Statement, is identified as IPCo Facilty 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 Merdian, County, Idao.
5. That Engineer recognzes that the Agreement provides for the Project to fuish electrical
energy to Idaho Power for a twenty-five (25) 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 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 Electrical Practices as that term is described in the Agreement.
10. That the design and construction of the Project is such that with reasonable and prudent
operation and maintenance practices by Seller, the Project is capable of performing in accordace with the
terms of the Agreement and with Prudent Electrical Practices for a twenty (20) year period.
1 i. That Engineer recognizes that Idaho Power, in accordance with paragrph 5.3 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 cerifies 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. Stap)
Date
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APPENDIXD
FORMS OF LIQUID SECURTY
To the extent required pursuant to this Agreement, Seller shall provide Idaho Power with one or
more commercially reasonable securty instruments such as Cash Escrow Security, Guarantee or
Letter of Credit as those terms are defined below or other forms of liquid financial security that
would provide readily available cash to Idaho Power to satisfy the Delay Security and any other
securty requirements withi this Agreement.
For the purose ofthis Appendix D, the term "Credit Requirements" shall mean acceptable
financial creditworthiness of the entity providing the security instrument in relation to the term of
the obligation in the reasonable judgment ofIdaho Power, provided that (a) any guarantee issued by
any other entity with a short-term or long-term investment grde credit rating by Standard & Poor's
Corporation or Moody's Investor Serces, Inc. shall be deemed to have acceptable financial
creditworthiness, and (b) any letter of credit issued by any other entity with a short-term or
long-term investment grde credit rating of A- by Standad & Poor's Corporation or A3 by
Moody's Investor Servces, Inc. shall be deemed to have acceptable financial creditworthiness.
1. Cash Escrow Securty - Seller shall deposit funds in an escrow account established by the
Seller in a banng institution acceptable to both Paries equal to the Delay Securty or other
required securty amount(s). The Seller shall be responsible for all costs, and receive any
interest earned associated with establishing and maintainig the escrow account(s).
2. Guarantee or Letter of Credit Securty - Seller shall post and maintain in an amount equal to the
Delay Security or other required security amount either: (a) a Guarantee from Seller's
corporate parent or a party that satisfies the Credit Requirements, in a form acceptable to
Idao Power at its reasonable discretion, or (b) an irrevocable Letter of Credit in a form
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substantially similar to the form in Appendix F, in favor of Idaho Power. The Letter of Credit
wil be issued by a financial institution that satisfies the Credit Requirements. The Seller shall
be responsible for its own costs and all costs imposed by the guarntor(s) or the issuer of the
Letter(s) of Credit associated with establishing and maintaining the Guarantee(s) or Letter(s) of
Credit.
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APPENDIXE
WIN ENERGY PRODUCTION FORECASTING
As specified in Commission Order 30488, Idaho Power shall make use of a Wind Energy Production
Forecasting model to forecast the energy production from this Facility and other Qualifyng Facilty wind
generation resources. Seller and Idaho Power wil share the cost of Wind Energy Production Forecasting.
The Facilty's share of Wind Energy Production Forecasting is determined as specified below. Sellers share
wil not be greater than 0.1 % of the total energy payments made to Seller by Idaho Power durg the
previous Contract Year.
a. For every month of this Agreement beginnng with the first ful month after the
First Energy Date, the "Wind Energy Production Forecasting Monthly Cost
Allocation" (or "MCA") wil be due and payable by the Seller. Any MCAs that
are not reimbursed to Idaho Power shall be deducted from energy payments to the
Seller.
b. As the value of the 0.1% cap of the Facilties total energy payments wil not be
known until the first Contract Year is complete, at the end of the first Contract
Year any prior allocations that exceeded the 0.1 % cap shall be adjusted to reflect
the 0.1 % cap and if the Facilty has paid the MCAs a refund wil be included in
equal monthly amounts over the ensuing Contract Year. If the Facility has not paid
the MCAs the amount due Idaho Power wil be adjusted accordingly and the
unpaid balance wil be deducted from the ensuing Contract Year's energy
payments.
c. The cost allocation formula described below wil be reviewed and revised if
necessar on the last day of any month in which the cumulative MW nameplate of
wind projects having Commission approved agreements to deliver energy to
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Except so far as otherwise stated, this Letter of Credit is subject to the International Standby Practices
ISP98 (also known as iCC Publication No. 590), or revision curently in effect (the "ISP"). As to matters
not covered by the ISP, the laws of the State of California, without regard to the principles of conflicts of
laws thereunder, shall govern all matters with respect to this Letter of Credit.
AUTHORIED SIGNATU for Issuer
(Name)
Title:
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ATTACHMENT A
Drawing Certifcate
TO ¡ISSUING BANK NAME)
IRVOCABLE NON-TRASFERALE STANBY LETTER OF CREDIT
No.
DRAWING CERTIFICATE
Bank
Ban Address
Subject: Irevocable Non-transferable Standby Letter of Credit
Reference Number:
The undersigned , an authorized representative of Idaho Power Company
(the "Beneficiary"), hereby certifies to ¡Issuing Bank Name) (the "Bank"), and
(the "Applicant"), with reference to Irevocable Nontransferable Standby Letter of Credit No. l
L dated , (the "Letter of Credit"), issued by the Bank in favor of the
Beneficiary, as follows as of the date hereof:
1. The Beneficiar is entitled to drw under the Letter of Credit an amount equal to
$ , for the following reason( s) (check applicable provision):
( )A. Pursuant to the terms of that certain Firm Energy Sales Agreement between Applicant and
Beneficiary, dated as of (Date of Execution 1 (the "Agreement"), Beneficiar is entitled to
draw under the Letter of Credit amounts owed by Applicant under the Agreement.
( )B. The Letter of Credit wil expire in fewer than 30 days from the date hereof, and Applicant
has not provided Beneficiar alternative security acceptable to Beneficiar.
2. Based upon the foregoing, the Beneficiar hereby makes demand under the Letter of Credit for
payment of U.S. DOLLARS AN ~100ths (U.S.$ ), which amount does
not exceed (i) the amount set forth in paragraph 1 above, and (ii) the Available Amount under the
Letter of Credit as of the date hereof.
3. Funds paid pursuat to the provisions of the Letter of Credit shall be wire transferred to the
Beneficiar in accordance with the following instrctions:
Unless otherwise provided herein, capitalized terms which are used and not defined herein shall have the
meaning given each such term in the Letter of Credit.
IN WITNSS WHEREOF, this Certificate has been duly executed and delivered on behalf of the
Beneficiary by its authorized representative as of this _ day of '_'
Beneficiar: IDAHO POWER COMPANY
By:
Name:
Title:
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APPENDIXG
SAMPLE SHORTFALL DAMAGES CALCULATION
PARGRAH 6.6.4 OF TH AGREEMENT
Sample Mechanical Availabilty damage calculation
April 2012 (Hypothetical Month)
MAG Shortall calculation
Mechanical Availabilty Guarantee (Paragraph 6.6)
Less: Current Month calculated Mechanical Availability
MAG shortfall
85.00%
80.00%
5.00%
KWh shortall
April Initial Year Monthly Net Energy amounts (paragraph 6.41)20,015,000 KWh
Multiplied by the MAG shortfall
KWh Shortfall
5.00%
1,000,750 KWh
Availabilty Shortfall Price - as defined in paragraph 1.2 and not to
be less than 15.00 Mills/KWh 15.00 Mils / KWh
Shortall Payment payable to Idaho Power $15,011.25
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