20101022Comment.pdf

Jean Jewell
From:
Sent:
To:
Subject:
BlueRibbonEnergy~gmail.com & ArronEsq~aol.com
Thursday, October 21, 2010 1 :23 PM
Jean Jewell; Beverly Barker; Gene Fadness
PUC Comment Form
A Comment from Blue Ribbon Energy LLC follows:
Case Number: IPC-E-10-24
Name: Blue Ribbon Energy LLC
Address: 4515 South Ammon Road
City: Ammon
State: Idaho
Zip: 83406
Daytime Telephone: [phone]
Contact E-Mail: BlueRibbonEnerg~mail.com & ArronEsg~aol. com Name of Utility Company: Idaho
Power
Acknowledge: acknowledge
Please describe your comment briefly:
The September 3, 2010 Firm Energy Electricity Sales Contract between Idaho Power and
British petroleum/Ridgeline for their Rockland Wind Project LLC, is for what some call a
Large PUiRPA Project, but in actuality is just a PURPA Facility by definition (16 USC Chapter
12, Subchapter I, §796(17). Blue Ribbon Energy LLC (hereafter "Blue Ribbon") has no objection
to the a~firmation of the Contract. Blue Ribbon would however like to make a comment about
the cont,ract.
COMMENT:' THE ABOVE IP AGREEMENT SHOULD NOT SET PRECEDENT
Article VII of the Agreement contains a negotiated levelized energy price for the 25-
year term, calculated to be $71.29 per MWh, which is substantially less than the $82.38
levelized published PURPA price set out in the March 16, 2010 Order number 31025, and
concerning which there is an even greater disparity with the proposed avoided cost rates
contained in the Stawman Poll, sent out recently by the IPUC staff for IP of $85.30. The
Public Uti iities Commission should specifically rule in writing, as part of the Order and
approval p ocess concerning the aforesaid agreement, that the negotiated payment rate
contained t erein, cannot be used by Idaho Power or any other Utility, as a precedent in
dealing wit other developers, who do not have the resources of British Petroleum/Ridgeline,
whose main bjective may be the ITC Credit, rather than a cash grant or other objectives, and
which other developers are financially constrained by debt and equity financing and cash
grants to f nd their wind projects. If Idaho Power or any other Utility is allowed to treat
this contrac with BP as any sort of precedent, it would have a strong, perhaps disasters,
chilling aff ct on other private developers and on the wind industry in Idaho. The proposed
rates contain d in the Strawman Poll are moving in the opposite and correct direction, from
the aforesaid contract rate, and into closer, but not yet full, compliance with FERC
regulations an the PURPA ACT requirements, which require the utility to pay to small energy
producers the CTUAL AVOIDED COSTS - "the cost to the electric utility of the electric energy
which, but for he purchase from such cogenerator or small power producer, such utility would
generate..."(se 16 USC, Chapter 12, Subchapter II, §824a-3(d)). The fact that the facility
is greater than 20 MW nameplate does not affect the PURPA Avoided Cost Rate, "Incremental
cost of alterna ive electric energy" because by statutory definition., "small power
production faci i ty" "means . . . a facility which . . . is not greater than 80 megawatts"
(see 16 USC Cha ter 12, Subchapter I, §796(17)). Recently the Utilities filed with the IPUC
their ACTUAL CO TS OF PRODUCING ELECTRICITY, the lowest of which, as Blue Ribbon understands
it from the IP C staff, was above $84. 00/MWh, and higher than the present published levelized
IP rate of $82. 38/MWh, and certainly substantially higher than the negotiated rate in the
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above contract between Idaho Power and BP/Ridgeline. This means that neither the presently
published rate nor the negotiated rate in the above contract appear to comply with the
demands and requirements of the PURPA Act as Blue Ribbon understands it.
BP, as Blue Ribbon is reasonably informed, owns Ridgeline, which can absorb a lower
payment rate in order to obtain tax credits and other benefits, compared to a small developerwhich cannot. .
Respectfully submitted,
Blue Ribbon Energy LLC
The form submitted on http://www . puc. idaho.gov/forms/ipuc1/ipuc. html
IP address is 207.200.116.138
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