20071224Reply.pdf

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Peter Richardson
Tel: [phone] Fax: [phone]
pete r~ r Îc h a rdson an cl ø I ca,y. c () m
P.O. Hox 7218, Ho¡,c, m. 83707 - 515 N. 27th St., Ho;,c, i I). 83702
24 December 2007
Ms. Jean Jewell
Commission Secretary
Idaho Public Utilities Commission
PO Box 83720
Boise 10 83720-0074
RE: Case No. IPC-E-07 -13
Dear Ms. Jewell:
Enclosed please find an original and seven (7) copies of the REPLY TO
ANSWER of Exergy Development Group of Idaho in the above referenced matter.
I have also enclosed an extra copy to be service-dated and returned to us for
our files. Thank you.
Sincerely,p~~
Peter Richardson
enc!.
Peter J. Richardson
ISB No. 3195
Richardson & O'Leary
515 N. 27th Street
P.O. Box 7218
Boise, Idaho 83702
Telephone: [phone] Tel
Fax: [phone] Fax
peter~richardsonandoleary .com
Attorneys for Exergy Development Group of Idaho, LLC
2001 DEC 24 Ari 9= ;-0
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
EXERGY DEVELOPMENT GROUP OF
IDAHO,LLC
Petitioner,
)
) CASE NO. IPC-E-07-/3
)
) REPLY TO IDAHO POWER'S
~ ANSWER TO EXERGY'S COMPLAINT
)
)
vs.
IDAHO POWER COMPANY,
Respondent.
COMES NOW, Exergy Development Group ofIdaho, LLC ("Exergy,"), by and through its
attorneys of record, Richardson & O'Leary, hereby fies its Reply to Idaho Power's Answer in
the above captioned matter.
FERC HAS NO AUTHORITY OVER THE ISSUES IN EXERGY'S COMPLAINT
The cornerstone of Exergy' s complaint is that Idaho Power is not complying with its
Schedule 72 when it demands upfront payment of estimated costs of conducting an
interconnection study for a QF that is proposing to sell output to Idaho Power. Schedule 72 is
the only Commission approved process governing the interconnection of a QF to Idaho Power's
system. Idaho Power concedes, in its Answer that this Commission has exclusive jurisdiction
over the QF interconnection process:
The Idaho and Oregon Commissions have exclusive jursdiction over
interconnections between Idaho Power and QFs sitused (sic) in Idaho or Oregon
respectively, so long as the QFs sell the output of their generation to Idaho Power.
Answer at p. 3.
Despite its acknowledgment that this Commission is the only entity with the authority to govern
the QF interconnection process, Idaho Power admits that it is unilaterally applying the
interconnection rules adopted by a foreign jurisdiction with no authority over the process at
hand:
To assure compliance with FERC regulations, Idaho Power applies the FERC
rules for processing all interconnection requests, including QF requests for
interconnection.
Answer at p. 5.
This Commission has adopted its own regulations for processing interconnection requests from
QFs. It has not adopted FERC's regulations for processing interconnection requests from QFs.
Idaho Power has unilaterally adopted a set of regulations that are per se ultra vires. Not only has
this Commission not adopted FERC's regulations for governing the interconnection ofQFs, it
has never even been asked to do so.
Furhermore, it is uneasonable to assume that FERC's interconnection rules are
appropriate for wholesale adoption in Idaho for QF interconnections. Many states have adopted
their own comprehensive set of interconnection rules for QF interconnections that recognze the
fact that most QFs interconnect at distribution or sub-transmission voltages. FERC's rules only
apply to interconnections that are being made for the purose of wheeling the generation over the
REPLY TO ANSWER 2
native utilty's system to a different utility. Such wheeling arrangements are almost always
made at transmission voltage levels. If this Commission is inclined to abandon Schedule 72 in
favor of the FERC process, then the QF industry should have an opportty to participate in the
proceeding in which that decision is made.
Idaho Power argues that applying the FERC interconnection rules is consistent with
provisions of Schedule 72. Answer at p. 5. Of course the question raised by Exergy's complaint
is not whether FERC's Rules and Schedule 72 are consistent or are, in some fashion haronious,
the question is whether Idaho Power has complied with Schedule 72 - which clearly does not
contain a deposit requirement.
For all of the above reasons, and pursuant to fudamental notions of due process, all of
Idaho Power's reliance on FERC regulations in its Answer for justification of its demand of a
deposit must be disregarded. Idaho Power should be required to tum to the four corners of its
own tariff for the source of all of its authority in the Q F interconnection arena.
SCHEDULE 72 HAS NO DEPOSIT REQUIREMENT
While claiming to follow the FERC interconnection rules, some of Idaho Power's
requirements are cut from whole cloth, are independent of both FERC and Schedule 72
requirements, and are internally inconsistent. For example: early in its Answer Idaho Power
states that it only requires deposits from "developers that canot meet minimum credit
worthiness standards". Answer p. 2. Later, the Company states that Schedule 72 "authorizes
Idaho Power to require that generation developers who do not meet minimum credit
requirements, (to) provide a deposit". Answer p. 6. Nowhere in Schedule 72 are such deposits
even authorized, let alone made contingent upon a creditworthiness standard. Indeed there is no
test provided for in Schedule 72 defining exactly what "creditworthiness" means.
REPLY TO ANSWER 3
It should be noted that Exergy has not been asked to provide a credit worthiness report to
Idaho Power in lieu of posting a study deposit. This fact may be explained by Idaho Power's
assertion on the very next page of its Answer that it is prohibited by this Commission from
requiring QF developers to disclose their credit worthiness. Answer p. 7. Presumably these are
issues this Commission would be asked to address were it inclined to initiate a proceeding to
investigate an alternative to, or supplement of, Schedule 72.
AT A MINIMUM IDAHO POWER SHOULD BE HELD TO ACCOUNT FOR ITS
PUBLISHED RATES
Although Idaho Power claims that its process for interconnection is transparent and
published on its interconnection web site, Exergy asks that Idaho Power be required to, at a
minimum offer its published deposit limits that are identified in Exergy's compliant. Shortly
after Exergy's complaint was filed, the published deposit amounts of $26,000 and $3,000 for a
Facilities Study and System Impact Study were unilaterally stricken from Idaho Power's
standard agreements published on its generation interconnection web site.
DATED this 24th day of December 2008.
Richardson & O'Leary, LLP
By (1O ~
Peter J. Richardson
Industrial Customers of Idaho Power
REPLY TO ANSWER 4
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on the 24th day of December, 2007, a true and correct copy of
the within and foregoing REPL Y TO ANSWER, was served by personal service to:
Baron Kline
Monica Moen
Idaho Power Company
POBox 70
Boise, Idaho 83707-0070
Jean Jewell
Commission Secretar
Idaho Public Utilties Commission
472 West Washington
Boise, Idaho 83702
Scott Woodbury
Deputy Attorney General
Idaho Public Utilities Commission
4 72 West Washington Street
Boise, Idaho 83702
~.Jo.
Peter Richardson
REPLY TO ANSWER 5