20101021Application.pdf

DONOVAN E. WALKER
Senior Counsel
dwalker(âidahopower.com
1SIDA~POR~
An IDACORP company
October 20, 2010
VIA HAND DELIVERY
Jean D. Jewell, Secretary
Idaho Public Utilties Commission
472 West Washington Street
P.O. Box 83720
Boise, Idaho 83720-0074
Re: Case No. IPC-E-10-26
IN THE MA TTER OF THE APPLICATION OF IDAHO POWER COMPANY
FOR APPROVAL OF A FIRM ENERGY SALES AGREEMENT WITH
AGPOWER JEROME, LLC, FOR THE SALE AND PURCHASE OF
ELECTRIC ENERGY FROM THE DOUBLE A DIGESTER PROJECT
Dear Ms. Jewell:
Enclosed for filng please find an original and seven (7) copies of Idaho Power
Company's Application in the above matter.
Very truly yours,eb~~
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]
dwalkercæidahopower.com
Inordstromcæidahopower.com
Attorneys for Idaho Power Company
Street Address for Express Mail:
1221 West Idaho Street
Boise, Idaho 83702
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BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION
OF IDAHO POWER COMPANY FOR
APPROVAL OF A FIRM ENERGY SALES
AGREEMENT WITH AGPOWER
JEROME, LLC, FOR THE SALE AND
PURCHASE OF ELECTRIC ENERGY
FROM THE DOUBLE A DIGESTER
PROJECT.
)
) CASE NO. IPC-E-10-26
)
) APPLICATION
)
)
)
)
)
Idaho Power Company ("Idaho Powet' or "Company"), in accordance with Idaho
Code § 61-503 and RP 52 and the applicable provisions of the Public Utilty Regulatory
Policies Act of 1978 ("PURPA"), hereby respectfully applies to the Idaho Public Utilties
Commission ("IPUC" or "Commission") for an Order approving the Firm Energy Sales
Agreement ("FESA") between Idaho Power and AgPower Jerome, LLC ("AgPowet')
under which AgPower would sell and Idaho Power would purchase electric energy
generated by the Double A Digester Project ("Facilty") located in Lincoln County, Idaho.
APPLICATION - 1
In support of this Application Idaho Power represents as follows:
I. BACKGROUND
1. Sections 201 and 210 of PURPA, and pertinent regulations of the Federal
Energy Regulatory Commission ("FERC"), require that regulated electric utilties
purchase power produced by cogenerators or small power producers that obtain
qualifying facilty ("QF") status. The purchase price a QF receives for the sale of its
power is generally referred to as the avoided cost rate and is computed to be equal to
the incremental cost to an electric utilty of electric energy or capacity or both, which, but
for the purchase from the QF, such utilty would generate itself or purchase from
another source. The Commission has authority under PURPA Sections 201 and 210
and the implementing regulations of the FERC, 18 C.F.R. § 292, to set avoided costs, to
order electric utilties to enter into fixed-term obligations for the purchase of energy from
QFs, and to implement FERC's PURPA rules.
II. THE FIRM ENERGY SALES AGREEMENT
2. On October 13, 2010, Idaho Power and AgPower entered into a Firm
Energy Sales Agreement ("Agreement") for the Facilty pursuant to the terms and
conditions of the various Commission Orders applicable to this PURPA agreement.
See, Order Nos. 30415, 30488, 30738, and 30744. A copy of the Agreement is
enclosed with this Application as Attachment NO.1. The Agreement is for a term of 20
years and contains the non-Ievelized published avoided cost rates established by the
Commission in Order No. 30744 for energy deliveries of less than 10 average
megawatts ("MW").
APPLICATION - 2
3. The nameplate rating of this Facilty wil be 1.6 MW. As defined in
paragraph 1.21 of the Agreement and as described in paragraph 4.1.3 of the
Agreement, AgPower wil be required to provide data on the Facilty that Idaho Power
wil use to confirm that under normal and/or average conditions the Facilty wil not
exceed 10 average MW on a monthly basis.
4. AgPower has elected a Scheduled Operation Date of January 1 , 2012, for
the Facilty. If the Facilty has not achieved its Operation Date by that date, Delay
Liquidated Damages and associated Delay Security provisions within this Agreement
are applicable.
5. Section 21.1 of the Agreement provides that the Agreement 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 AgPower for
purchases of energy wil be allowed as prudently incurred expenses for ratemaking
purposes.
6. AgPower is current in the requirements of its interconnection process. All
applicable interconnection study charges under Schedule 72 have been assessed and
collected from AgPower. The final interconnection Feasibilty Study is complete and the
Facilty Study for the Facilty has been offered with payment due on November 17,
2010.
II. APPLICABLE RATES
7. On March 1, 2010, in Order No. 30125 issued in Case No. GNR-E-1 0-01,
the Commission adopted new published avoided cost rates for the purchase by Idaho
Power of capacity energy from PURPA QFs. The rates adopted in Order No. 31025 are
APPLICATION - 3
approximately 10 percent lower than the rates previously adopted in Case No. GNR-E-
09-01, Order No. 30744. By its terms, Order No. 31025 applies to new PURPA
contracts executed on and after March 16, 2010. Because the Agreement is dated
October 13, 2010, Order No. 31025 would require that the rates to be paid AgPower
under the Agreement would be the rates set out in Order No. 31025 rather than the
higher rates approved by the Commission in Order No. 30744. However, this
Commission has recognized in prior Orders that there are situations when QF rates are
changed that it is appropriate to include a prior vintage of rates in a current PURPA
contract.
1 In several cases litigated in the early to mid-1990s, the Commission
determined, and the Idaho Supreme Court affrmed, certain criteria that a QF developer
must satisfy in order to establish an entitlement to sell energy at a particular published
avoided cost rate.2 One of the criteria that would qualify a particular generating facilty
to receive the superseded rate requires that the developer have executed a power sales
agreement with the utility at the rate in question before a successor rate becomes
effective. If the QF cannot meet the first criteria, the second criteria requires that prior
to the new rates effective date, the QF developer must have filed a meritorious
complaint alleging that the project was suffciently mature and far enough along in the
contracting process that but for the conduct of the utility company, the developer would
have been able to sign a contract with the utilty containing the superseded rates.
8. In this case, AgPower had not signed a contract with Idaho Power to
purchase the Facilty generation on or before March 16, 2010. On April 9, 2010,
1 The Idaho Supreme Court has confirmed that it is within the Commission's jurisdiction to
determine which vintage of QF rates should apply to a PURPA contract. See Empire Lumber v.
Washington Water Power, 114 Idaho 191, 755 P.2d 1229 (1988) and A.W Brown Co., Inc., v. Idaho
Power Company, 121 Idaho 812,828 P.2d 841 (1992).
2 A.W Brown, Rosebud, 131 Idaho.
APPLICATION - 4
AgPower filed a Complaint 'at the Commission alleging that it was entitled to a contract
containing the higher Order No. 30744 rates. On May 5, 2010, Idaho Power filed an
Answer to AgPowets Complaint. Upon further review of the facts, and by signing this
Agreement and voluntarily submitting it to the Commission, Idaho Power submits that
AgPower should be entitled to the rates established by Order No. 30744 in Case No.
GNR-E-09-01. The Company has received a number of requests for "grandfathering" of
QF contracts. In making a determination to file and support an application urging that a
particular QF project is entitled to the Order No. 30744 rates, the Company concluded
that a project must have met the following criteria:
a. Interconnection and Transmission
i. Filed an interconnection application; and
ii. Received and accepted an interconnection feasibilty study
report for the project and paid any requested study deposits (or established credit) for
the next phase of the interconnection process in accordance with Schedule 72; and
iii. Received confirmation from Idaho Power that transmission
capacity is available for the project and/or received and accepted transmission capacity
study results and cost estimates.
b. Purchase Power Agreement
i. An agreement was materially complete prior to March 16,
2010, and except for routine Idaho Power final processing, an agreement would have
been executed by both parties prior to March 16, 2010.
9. It is Idaho Power's opinion that the AgPower Facilty meets the above-
referenced criteria, and that application of the grandfathered rate to its project is
APPLICATION - 5
consistent with the previously approved FESAs filed by Idaho Power containing this
same grandfathered rate. With respect to the power purchase agreement criteria, in
Idaho Powets Answer to AgPowets Complaint, (Case No. IPC-E-10-11), Idaho Power
stated that it did not agree at that time with AgPowets claim that it was entitled to a
FESA containing the grandfathered rate because AgPower had refused to agree to the
previously approved damages and security provisions that are part of the "standard"
terms and conditions of a PURPA FESA. All other material outstanding contract issues
had been resolved prior to March 16, 2010. In Idaho Powets opinion, the Agreement
would have been signed by both parties prior to March 16, 2010, except for the
disagreement as to the inclusion of the damages and security provisions of the contract.
By agreeing to the insertion and validity of those terms and signing a FESA containing
the same, AgPowets project is now similarly situated to those FESAs that have been
approved containing grandfathered rates. See, Cargil, Case No. IPC-E-10-15, Order
No. 32024; Rock Creek Dairy, Case No. IPC-E-10-16, Order No. 32025; Swagger
Farms Dairy, Case No. IPC-E-10-17, Order No. 32026; Double B Dairy, Case No. IPC-
E-10-18, Order No. 32027; and Grand View Solar, Case No. IPC-E-10-19, Order No.
32068. As a result, the Facilty should qualify for a contract including the Order No.
30744 rates.
10. The Agreement contains the most recent terms and conditions, including
the liquidated damages and security provisions previously approved by the Commission
in the Arena Drop and the Dry Creek dairy cases, Order Nos. 31060 and 31034,
respectively.
APPLICATION - 6
11. Based on the foregoing, Idaho Power believes that the Agreement meets
the criteria established by the Commission in its prior Orders and the Commission
should approve the Agreement as presented.
iv. MODIFIED PROCEDURE
12. Idaho Power believes that a hearing is not necessary to consider the
issues presented herein and respectully requests that this Application be processed
under Modified Procedure, Le., by written submissions rather than by hearing. RP 201,
et seq. If, however, the Commission determines that a technical hearing is required, the
Company stands ready to present its testimony and support the Application in such
hearing.
V. COMMUNICATIONS AND SERVICE OF PLEADINGS
13. 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
dwalkercæidahopower.com
Inordstromcæidahopower.com
Randy C. Allphin
Energy Contract Administrator
Idaho Power Company
1221 West Idaho Street
P.O. Box 70
Boise, Idaho 83707
rallphincæidahopower.com
VI. REQUEST FOR RELIEF
14. Idaho Power Company respectfully requests that the Commission issue
an Order: (1) authorizing that this matter may be processed by Modified Procedure; (2)
approving the Firm Energy Sales Agreement between Idaho Power Company and
AgPower Jerome, LLC, without change or condition; and (3) declaring that all payments
for purchases of energy under the Firm Energy Sales Agreement between Idaho Power
APPLICATION - 7
Company and AgPower Jerome, LLC, be allowed as prudently incurred expenses for
ratemaking purposes.
Respectfully submitted this 20th day of October 2010.
DONOVAN E. WALKER
Attorney for Idaho Power Company
APPLICATION - 8
CERTIFICATE OF MAILING
I HEREBY CERTIFY that on the 20th day of October 2010 I served a true and
correct copy of the foregoing APPLICATION upon the following named parties by the
method indicated below, and addressed to the following:
AgPower Jerome, LLCJim Wiest, Manager i.
AgPower Jerome, LLC
10475 East Park Meadows Drive, Suite 600
Lone Tree, Colorado 80124
Hand Delivered
U.S. Mail
Overnight Mail
FAX
Email
Peter J. Richardson
Gregory M. Adams
RICHARDSON & O'LEARY
515 North 2th Street
P.O. Box 7218
Boise, Idaho 83702
Hand Delivered
-2 U.S. Mail
Overnight Mail
FAX
i. Email petercærichardsonandoleary.com
gregcærichardsonandoleary.com
&£,
APPLICATION - 9
BEFORE THE
IDAHO PUBLIC UTiliTIES COMMISSION
CASE NO. IPC-E-10-26
IDAHO POWER COMPANY
ATTACHMENT NO.1
FIR ENERGY SALES AGREEMENT
BETWEEN
IDAHO POWER COMPANY
AN
AGPOWER JEROME, 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 Idaho Power
Waranties
Conditions to Acceptance of Energy
Term and Operation Date
Puchase and Sale of Net Energy
Puchase Price and Method of Payment
Environmental Attributes
Facility 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
Commission Order
Successors and Assigns
Modification
Taxes
Notices
Additional Terms and Conditions
Severabilty
Counterparts
Entire Agreement Signatures
Appendix A
AppendixB
AppendixC
AppendixD
10-7-2010
FIR ENERGY SALES AGREEMENT
(10 aMW or Less)
Project Name: Double A Digester Project
Project Number: 31616110
THIS AGREEMENT, entered into on this _ day of October 2010 between AgPower Jerome, LLC,
a Delaware limited liability company (Seller), and IDAHO POWER COMPAN, an Idao corporation (Idaho
Power), hereinafter sometimes referred to collectively as "Paries" or individually as "Pary."
WITNSSETH:
WHEREAS, Seller wil design, construct, own, maintain and operate an electric generation facilty; and
WHEREAS, Seller wishes to sell, and Idaho Power is wiling to purchase, firm electrc energy produced
by the Seller's Facility.
THEREFORE, In consideration of the mutual covenants and agreements hereinafter set forth, the
Paries agree as follows:
ARTICLE I: DEFINITIONS
As used in this Agreement and the appendices attached hereto, the following terms
shall have the following meanings:
1.1 "Base Energy" - Monthly Net Energy less than 110% of the monthly Net Energy Amount as specified
in paragraph 6.2 of this Agreement.
1.2 "Commission" - The Idaho Public Utilities Commssion.
1.3 "Contract Year" - The period commencing each calendar year on the same calenda date as the
Operation Date and ending 364 days thereafter.
1.4 "Delay Liquidated Damages" - Damages payable to Idaho Power as calculated in paragraph 5.3, 5.4,
5.5, 5.6 and 5.8.
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1.5 "Delay Period" - All days past the Scheduled Operation Date until the Seller's Facility achieves the
Operation Date.
1.6 "Delay Price" - The curent month's Mid-Columbia Market Energy Cost minus the current month's All
Hours Energy Price specified in paragraph 7.3 of this Agreement. If this calculation results in a value
less than 0, the result of this calculation wil be O.
1.7 "Designated Dispatch Facility" - Idaho Power's Systems Operations Group, or any subsequent group
designated by Idaho Power.
1.8 "Facility" - That electric generation facility described in Appendix B of this Agreement.
1.9 "Firt 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's system at the Point of Delivery.
1.10 "Heayy Load Hours" - The daily hours beginning 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, Thansgiving and Chrstmas.
1.11 "Inadvertent Energy" - Electric energy Seller does not intend to generate. Inadvertent energy is more
particularly described in paragraph 7.5 of this Agreement.
1.12 "Interconnection Facilties" - All equipment specified in Schedule 72.
1.13 "Initial Capacity Determination" - The process by which Idao Power confirs that under normal or
average design conditions the Facility wil generate at no more than 10 average MW per month and is
therefore eligible to be paid the published rates in accordance with Commission Order No. 29632.
1.14 "Light Load Hours" - The daily hours beginning at 11 :00 pm, ending at 7 :00 am Mountain Time (8
hours), plus all other hours on all Sundays, New Year Day, Memorial Day, Independence Day, Labor
Day, Thansgiving and Chrstmas.
1.15 "Losses" - The loss of electrical energy expressed in kilowatt hours (kWh) occurg as a result of the
transformation and transmission of energy between the point where the Facility's energy is metered and
the point the Facility's energy is delivered to the Idaho Power electrical system. The loss calculation
formula wil be as specified in Appendix B of this Agreement.
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l.16 "Market Energy Reference Price" - Eighty-five percent (85%) of the Mid-Columbia Market Energy
Cost.
1.17 "Material Breach" - A Default (paragraph 19.2.1) subject to paragraph 19.2.2.
1.18 "Maximum Capacity Amount" - The maximum capacity (MW) of the Facilty wil be as specified in
Appendix B of this Agreement.
1.19 "Metering Equipment" - All equipment specified in Schedule 72, this Agreement and any additional
equipment specified in Appendix B required to measure, record and telemeter bi directional power
flows between the Seller's electric generation plant and Idaho Power's system.
1.20 "Mid- Columbia Market Energy Cost" - The monthly weighted average of the daily on-peak and off-
peak Dow Jones Mid-Columbia Index (Dow Jones Mid-C Index) prices for non-firm energy. If the Dow
Jones Mid-Columbia Index price is discontinued by the reporting agency, both Paries wil mutually
agree upon a replacement index, which is similar to the Dow Jones Mid-Columbia Index. The selected
replacement index wil be consistent with other similar agreements and a commonly used index by the
electrical industr.
1.21 "Nameplate Capacity" -The full-load electrical quantities assigned by the designer to a generator and its
prime mover or other piece of electrical equipment, such as transformers and circuit breakers, under
standadized conditions, expressed in amperes, kilovolt-amperers, kilowatts, volts or other appropriate
units. Usually indicated on a nameplate attached to the individual machine or device.
1.22 "Net Energy" - All of the electric energy produced by the Facilty, less Station Use, less Losses,
expressed in kilowatt hours (kWh). Subject to the terms ofthis Agreement, Seller commits to deliver all
Net Energy to Idaho Power at the Point of Delivery for the full term of the Agreement. Net Energy does
not include Inadvertent Energy.
1.23 "Operation Date" - The day commencing at 00:01 hours, Mountain Time, following the day that all
requirements of paragraph 5.2 have been completed.
1.24 "Point of Delivery" - The location specified in Appendix B, where Idaho Power's and the Seller's
electrical facilties are interconnected and the energy from this Facilty is delivered to the Idaho Power
electrical system.
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1.25 "Prudent Electrical Practices" - Those practices, methods and equipment that are commonly and
ordinarly used in electrical engineering and operations to operate electric equipment lawfully, safely,
dependably, efficiently and economically.
1.26 "Scheduled Operation Date" - The date specified in Appendix B when Seller anticipates achieving the
Operation Date. It is expected that the Scheduled Operation Date provided by the Seller shall be a
reasonable estimate of the date that the Seller anticipates that the Seller's Facility shall achieve the
Operation Date.
1.27 "Schedule 72" - Idaho Power's Tariff No 101, Schedule 72 or its successor schedules as approved by
the Commission. The Seller shall be responsible to pay all costs of interconnection and integration of
this Facility into the Idaho Power electrical system as specified within Schedule 72.
1.28 "Season" - The three periods identified in paragraph 6.2.1 of this Agreement.
1.29 "Special Facilities" - Additions or alterations of transmission and/or distribution lines and transformers
as described in Schedule 72.
1.30 "Station Use" - Electric energy that is used to operate equipment that is auxiliar or otherwise related to
the production of electricity by the Facility.
1.31 "Surlus Energy" - Is (1) Net Energy produced by the Seller's Facilty and delivered to the Idaho Power
electrical system durig the month which exceeds 110% of the monthly Net Energy Amount for the
corresponding month specified in paragraph 6.2. or (2) If the Net Energy produced by the Seller's
Facility and delivered to the Idaho Power electrical system durng the month is less than 90% of the
monthly Net Energy Amount for the corresponding month specified in paragraph 6.2, then all Net
Energy delivered by the Facility to the Idao Power electrical system for that given month or (3) All Net
Energy produced by the Seller's Facility and delivered by the Facility to the Idao Power electrical
system prior to the Operation Date.
1.32 "Total Cost of the Facilty" - The total cost of structures, equipment and appurenances.
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ARTICLE II: NO RELIANCE ON IDAHO POWER
2.1 Seller Independent Investigation - Seller warrants and represents to Idaho Power that in entering into
this Agreement and the undertaking by Seller of the obligations set forth herein, Seller has investigated
and deterined that it is capable of performing hereunder and has not relied upon the advice,
experience or expertise of Idaho Power in connection with the transactions contemplated by this
Agreement.
2.2 Seller Independent Experts - All professionals or experts including, but not limited to, engineers,
attorneys or accountants, that Seller may have consulted or relied on in underting the transactions
contemplated by this Agreement have been solely those of Seller.
ARTICLE II: WARTIES
3.1 No Warranty by Idaho Power - Any review, acceptance or failure to review Seller's design,
specifications, equipment or facilities shall not be an endorsement or a confirmation by Idaho Power and
Idaho Power makes no waranties, expressed or implied, regardig any aspect of Seller's design,
specifications, equipment or facilities, including, but not limited to, safety, durbility, reliabilty,
strength, capacity, adequacy or economic feasibility.
3.2 Qualifyng Facility Status - Seller warants that the Facility is a "Qualifyng Facility," as that term is
used and defined in 18 CFR 292.201 et seq. After initial qualification, Seller wil take such steps as may
be required to maintain the Facility's Qualifying Facilty status durg the term of this Agreement and
Seller's failure to maintain Qualifying Facility status wil be a Material Breach of this Agreement.
Idaho Power reserves the right to review the Facility's Qualifyng Facility status and associated support
and compliance documents at anytime durng the term of this Agreement.
ARTICLE IV: CONDITIONS TO ACCEPTANCE OF ENERGY
4.1 Prior to the First Energy Date and as a condition of Idaho Power's acceptance of deliveries of energy
from the Seller under this Agreement, Seller shall:
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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 Subpar B, 18 CFR 292.201 et seq. as a certified
Qualifying Facility.
4.1.2 Opinon of Counsel - Submit to Idaho Power an Opinion Letter signed by an attorney admtted
to practice and in good standing in the State ofIdaho providing an opinion that Seller's licenses,
permits and approvals as set forth in paragraph 4.1.1 above are legally and validly issued, are
held in the name of the Seller and, based on a reasonable independent review, counsel is of the
opinion that Seller is in substantial compliance with said permits as of the date of the Opinion
Letter. The Opinion Letter wil be in a form acceptable to Idaho Power and wil acknowledge
that the attorney rendering the opinion understands that Idaho Power is relying on said opinion.
Idaho Power's acceptance of the form wil not be unreasonably withheld. The Opinion Letter
wil be governed by and shall be interpreted in accordance with the legal opinion accord of the
American Bar Association Section of Business Law (1991).
4.1.3 Intial Capacity Determination - Submit to Idaho Power such data as Idaho Power may
reasonably require to perform the Initial Capacity Determination. Such data wil include but not
be limited to, Nameplate Capacity, equipment specifications, prime mover data, resource
charcteristics, normal and/or average operating design conditions and Station Use data. Upon
receipt of this information, Idaho Power wil review the provided data and if necessary, request
additional data to complete the Initial Capacity Determination within a reasonable time.
4.1 .3.1 If the Maximum Capacity specified in Appendix B of this Agreement and the
cumulative manufactue Nameplate Capacity rating of the individual generation units at
this Facility is less than 10 MW. The Seller shall submit detailed, manufacturer,
verifiable data of the Nameplate Capacity ratings of the actual individual generation
units to be installed at this Facility. Upon verification by Idaho Power that the data
provided establishes the combined Nameplate Capacity rating of the generation units to
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be installed at this Facility is less than 10 MW, it wil be deemed that the Seller has
satisfied the Initial Capacity Determination for this Facility.
4.1.4 Nameplate Capacity - Submit to Idaho Power manufacturer's and engineerig documentation
that establishes the Nameplate Capacity of each individual generation unit that is included
within this entire Facilty. Upon receipt of this data, Idaho Power shall review the provided data
and determine if the Nameplate Capacity specified is reasonable based upon the manufacturer's
specified generation ratings for the specific generation units.
4.1.5 Engineer's Certifications - Submit an executed Engineer's Certification of Design &
Construction Adequacy and an Engineer's Certification of Operations and Maintenance (O&M)
Policy as described in Commission Order No. 21690. These certificates wil be in the form
specified in Appendix C but may be modified to the extent necessary to recognize the different
engineering disciplines providing the certificates.
4.1.6 Insurance - Submit written proof to Idaho Power of all insurance required in Aricle XIII.
4.1.7 Interconnection - Provide written confrmation from Idao Power's delivery business unit that
Seller has satisfied all interconnection requirements.
4.1.8 Network Resource Designation - The Seller's Facility has been designated as a network
resource capable of deliverig firm energy up to the amount of the Maximum Capacity.
4.1.9 Written Acceptance - Request and obtain written confiration from Idao Power that all
conditions to acceptance of energy have been fulfilled. Such written confirmation shall be
provided within a commercially reasonable time following the Seller's request and wil not be
unreasonably withheld by Idaho Power.
4.2 The Seller may terminate this agreement with no damages or penalties by providing written notice to
Idaho Power withi 30 days of the later of 1) the fial Facility Study and/or 2) notification from Idaho
Power of any required transmission network upgrade costs. This right to terminate shall expire if it not
acted upon by the Seller within the 30 days specified above.
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ARTICLE V: TERM AN OPERATION DATE
5.1 Term - Subject to the provisions of paragraph 5.2 below, this Agreement shall become effective on the
date first written and shall continue in full force and effect for a period of 20 Contract Years from the
Operation Date.
5.2 Operation Date - The Operation Date may occur only after the Facility has achieved all of the following:
a) Achieved the First Energy Date.
b) Commission approval of this Agreement in a form acceptable to Idao Power has been
received.
c) Seller has demonstrated to Idaho Power's satisfaction that the Facility is complete and able
to provide energy in a consistent, reliable and safe maner.
d) Seller has requested an Operation Date from Idaho Power in a written format.
e) Seller has received written confiration from Idaho Power of the Operation Date. This
confirmation wil not be uneasonably withheld by Idaho Power.
5.3 Operation Date Delay - Seller shall cause the Facility to achieve the Operation Date on or before the
Scheduled Operation Date. Delays in the interconnection and transmission network upgrade study, design
and construction process that are not Force Majeure events accepted by both Paries, shall not prevent
Delay Liquidated Damages from being due and owing as calculated in accordance with this Agreement.
5.3.1 If the Operation Date occurs after the Scheduled Operation Date but on or prior to 90 days
following the Scheduled Operation Date, Seller shall pay Idaho Power Delay Liquidated
Damages calculated at the end of each calendar month after the Scheduled Operation Date as
follows:
Delay Liquidated Damages are equal to ((Current month's Initial Year Net Energy
Amount as specified in paragraph 6.2.1 divided by the number of days in the curent
month) multiplied by the number of days in the Delay Period in the current month)
multiplied by the curent month's Delay Price.
5.3.2 If the Operation Date does not occur within ninety (90) days following the Scheduled Operation
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Date the Seller shall pay Idaho Power Delay Liquidated Damages, in addition to those provided
in paragraph 5.3.1, calculated as follows:
Forty five dollars ($45) multiplied by the Maximum Capacity with the Maximum
Capacity being measured in kW.
5.4 If Seller fails to achieve the Operation Date withi ninety (90) days following the Scheduled Operation
Date, such failure wil be a Material Breach and Idaho Power may terminate this Agreement at any time
until the Seller cures the Material Breach. Additional Delay Liquidated Damages beyond those
calculated in 5.3.1 and 5.3.2 wil be calculated and payable using the Delay Liquidated Damage
calculation described in 5.3.1 above for all days exceeding 90 days past the Scheduled Operation Date
until such time as the Seller cures this Material Breach or Idaho Power terminates this Agreement.
5.5 Seller shall pay Idaho Power any calculated Delay Damages or Delay Liquidated Damages within 7
days of when Idaho Power calculates and presents any Delay Damages or Delay Liquidated Damages
bilings to the Seller. Seller's failure to pay these damages within the specified time wil be a Material
Breach of this Agreement and Idao Power shall draw funds from the Delay Security provided by the
Seller in an amount equal to the calculated Delay Damages or Delay Liquidated Damages.
5.6 The Paries agree that the damages Idaho Power would incur due to delay in the Facilty achieving 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
damages.
5.7 Prior to the Seller executing this Agreement, the Seller shall have agreed to and executed a Letter of
Understanding with Idaho Power that contains at minimum the following requirements:
a) Seller has filed for interconnection and is in compliance with all payments and
requirements of the interconnection process
b) Seller has received and accepted an interconnection feasibilty study for this
Facilty.
c) Seller has provided all information required to enable Idao Power to fie an initial
transmission capacity request.
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d) Results of the initial transmission capacity request are known and acceptable to the
Seller.
e) Seller acknowledges responsibility for all interconnection costs and any costs
associated with acquiring adequate firm transmission capacity to enable the project
to be classified as an Idaho Power firm network resource.
t) If the Facility is located outside of the Idaho Power servce terrtory, in addition to
the above requirements, the Seller must provide evidence that the Seller has
acquired firm transmission capacity from all required transmitting entities to deliver
the Facility's energy to an acceptable point of delivery on the Idaho Power
electrical system.
5.8 Within thirty (30) days of the date of a final non-appealable order as specified in Aricle XXI approving
this Agreement the Seller shall post liquid securty ("Delay Security") in a form as described in
Appendix D equal to or exceeding the amount calculated in paragraph 5.8.1.
5.8.1 Delay Security The greater of forty five ($45) multiplied by the Maximum Capacity with the
Maximum Capacity being measured in kW or the sum of three month's estimated revenue.
Where the estimated thee months of revenue is the estimated revenue associated with the first
three full months following the estimated Scheduled Operation Date, the estimated kWh of
energy production as specified in pargraph 6.2.1 for those three months multiplied by the All
Hours Energy Price specified in paragraph 7.3 for each of those three months.
5.8.1.1 In the event (a) Seller provides Idaho Power with certification that (1) a generation
interconnection agreement specifyg a schedule that wil enable this Facility to achieve
the Operation Date no later than the Scheduled Operation Date has been completed and
the Seller has paid all required interconnection costs or (2) a generation interconnection
agreement is substantially complete and all material costs of interconnection have been
identified and agreed upon and the Seller is in compliance with all ters and
conditions of the generation interconnection agreement, the Delay Securty calculated
in accordance with paragraph 5.8.1 wil be reduced by ten percent (10%).
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5.8.1.2 If the Seller has received a reduction in the calculated Delay Securty as specified in
paragraph 5.8.1.1 and subsequently (1) at Seller's request, the generation
interconnection agreement specified in paragraph 5.8.1.1 is revised and as a result the
Facility wil not achieve its Operation Date by the Scheduled Operation Date or (2) if
the Seller does not maintain compliance with the generation interconnection agreement,
the full amount of the Delay Security as calculated in paragraph 5.8.1 wil be subject to
reinstatement and wil be due and owing within 5 business days from the date Idao
Power requests reinstatement. Failure to timely reinstate the Delay Securty wil be a
Material Breach of this Agreement.
5.8.2 Idaho Power shall release any remaining security posted hereunder after all calculated Delay Damages
and/or Delay Liquidated Damages are paid in full to Idaho Power and the earlier of (1) 30 days after the
Operation Date has been achieved or (2) 60 days after the Agreement has been terminated.
ARTICLE VI: PURCHASE AND SALE OF NET ENERGY
6.1 Delivery and Acceptance of Net Energy - Except when either Pary's performance is excused as
provided herein, Idao Power wil purchase and Seller wil sell all of the Net Energy to Idaho Power at
the Point of Delivery. All Inadvertent Energy produced by the Facility wil also be delivered by the
Seller to Idaho Power at the Point of Delivery. At no time wil the total amount of Net Energy and/or
Inadvertent Energy produced by the Facilty and delivered by the Seller to the Point of Delivery exceed
the Maximum Capacity Amount.
6.2 Net Energy Amounts - Seller intends to produce and deliver Net Energy in the following monthly
amounts:
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6.2.1 Initial Year Monthly Net Energy Amounts:
Month
Season 1
March
April
May
Season 2
July
August
November
December
Season 3
June
September
October
Januar
Februar
kWh
2,484,000
2,484,000
2,484,000
2,484,000
2,484,000
2,484,000
2,484,000
2,484,000
2,484,000
2,484,000
2,484,000
2,484,000
6.2.2 Ongoing Monthly Net Energy Amounts - Seller shall initially provide Idaho Power with one
year of monthly generation estimates (Initial Year Monthly Net Energy Amounts) and
begining at the end of month nine and every three months thereafter provide Idaho Power with
an additional three months of forward generation estimates beyond those generation estimates
previously provided. This information wil be provided to Idaho Power by written notice in
accordance with paragraph 25.1, no later than 5:00 PM of the 5th day following the end of the
previous month. If the Seller does not provide the Ongoing Monthly Net Energy Amounts in a
timely maner, Idaho Power wil use the most recent 3 months of the Initial Year Monthly Net
Energy Amounts specified in paragraph 6.2.1 for the next 3 months of monthly Net Energy
amounts.
6.2.3 Seller's Adjustment of Net Energy Amount
6.2.3.1 No later than the Operation Date, by written notice given to Idaho Power in accordace
with paragraph 25.1, the Seller may revise all of the previously provided Initial Year
Monthly Net Energy Amounts.
6.2.3.2 Beginning with the end of the 9th month after the Operation Date and at the end of
every third month thereafter: (1) the Seller may not revise the immediate next three
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months of previously provided Net Energy Amounts, (2) but by written notice given to
Idaho Power in accordance with paragraph 25.1, no later than 5:00 PM of the 5th day
following the end of the previous month, the Seller may revise all other previously
provided Net Energy Amounts. Failure to provide timely written notice of changed
amounts wil be deemed to be an election of no change.
6.2.4 Idaho Power Adjustment of Net Energy Amount - IfIdaho Power is excused from accepting the
Seller's Net Energy as specified in paragraph 12.2.1 or if the Seller declares a Suspension of
Energy Deliveries as specified in paragraph 12.3.1 and the Seller's declared Suspension of
Energy Deliveries is accepted by Idaho Power, the Net Energy Amount as specified in
paragraph 6.2 for the specific month in which the reduction or suspension under paragraph
12.2.1 or 12.3.1 occurs wil be reduced in accordance with the following:
Where:
NEA Current Month's Net Energy Amount (Paragraph 6.2)
SGU a.) If Idaho Power is excused from accepting the Seller's Net
Energy as specified in paragraph 12.2.1 this value wil be
equal to the percentage of curailment as specified by
Idaho Power multiplied by the TGU as defined below.
b.) If the Seller declares a Suspension of Energy Deliveries as
specified in paragraph 12.3.1 this value wil be the sum of
the individual generation units size ratings as specified in
Appendix B that are impacted by the circumstances
causing the Seller to declare a Suspension of Energy
Deliveries.
TGU Sum of all of the individual generator ratings of the generation
units at this Facility as specified in Appendix B ofthis
agreement.
RSH Actual hours the Facilty's Net Energy deliveries were either
reduced or suspended under pargraph 12.2.1 or 12.3.1
TH Actual total hours in the current month
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Resulting formula being:
Adjusted
Net Energy = NEA
Amount _(( XNEA)X(TGU TH ) )
This Adjusted Net Energy Amount wil be used in applicable Surplus Energy calculations for only the
specific month in which Idaho Power was excused from accepting the Seller's Net Energy or the Seller
declared a Suspension of Energy.
6.3 Unless excused by an event of Force Majeure, Seller's failure to deliver Net Energy in any Contract
Year in an amount equal to at least ten percent (10%) of the sum of the Initial Year Net Energy
Amounts as specified in paragrph 6.2 shall constitute an event of default.
ARTICLE VII: PURCHASE PRICE AN METHOD OF PAYMENT
7.1 Base Energy Heavy Load Purchase Price - For all Base Energy received durng Heavy Load Hours,
Idaho Power wil pay the non-levelized energy price in accordance with Commission Order 30744,
30738 and adjusted in accordance with Commission Order 30415 for Heavy Load Hour Energy
deliveries with seasona1ization factors applied:
Year
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
Season 1 - (73.50 %)
Mils/kWh
57.98
59.54
61.22
62.62
64.05
65.52
67.10
68.63
70.29
71.91
73.56
75.26
76.99
78.78
80.60
82.47
84.75
87.10
Season 2 - (120.00 %)
Mils/kWh
94.67
97.21
99.95
102.23
104.57
106.97
109.55
112.05
114.77
117.40
120.10
122.87
125.70
128.61
131.59
134.65
138.37
142.21
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Season 3 - (100.00 %)
Mils/kWh
78.89
81.01
83.29
85.19
87.14
89.14
91.29
93.38
95.64
97.83
100.08
102.39
104.75
107.18
109.66
112.21
115.31
118.51
10172010
2028
2029
2030
2031
89.53
92.03
94.60
96.69
146.17
150.25
154.45
157.85
121.81
125.21
128.71
131.55
7.2 Base Energy Light Load Purchase Price - For all Base Energy received durng Light Load Hours, Idaho
Power wil pay the non-Ievelized energy price in accordance with Commission Order 30744, 30738 and
adjusted in accordance with Commission Order 30415 for Light Load Hour Energy deliveries with
seasonalization factors applied:
Year
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
Season 1 - (73.50 %)
Mils/kWh
52.63
54.19
55.87
57.27
58.70
60.17
61.75
63.28
64.94
66.56
68.21
69.90
71.64
73.42
75.25
77.12
79.40
81.75
84.18
86.68
89.25
91.33
Season 2 - (120.00 %)
Mils/kWh
85.93
88.47
91.21
93.49
95.83
98.23
100.81
103.32
106.03
108.66
11 1.36
114.13
116.97
119.88
122.86
125.91
129.64
133.48
137.43
141.51
145.71
149.12
Season 3 - (100.00 %)
Mils/kWh
71.61
73.73
76.01
77.91
79.86
81.86
84.01
86.10
88.36
90.55
92.80
95.11
97.47
99.90
102.38
104.93
108.03
11 1.23
114.53
117.93
121.43
124.27
7.3 All Hours Energy Price - The price to be used in the calculation of the Surplus Energy Price and Delay
Damage Price shall be the non-levelized energy price in accordance with Commission Order 30744 and
30738 with seasonalization factors applied:
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Year
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
Season 1 - (73.50 %)
Mils/kWh
55.60
57.16
58.84
60.24
61.67
63.14
64.72
66.25
67.91
69.53
71.18
72.87
74.61
76.39
78.22
80.09
82.37
84.72
87.15
89.64
92.22
94.30
Season 2 - (120.00 %)
Mils/kWh
90.78
93.32
96.06
98.34
100.68
103.08
105.66
108.17
110.88
113.51
116.21
118.98
121.82
124.72
127.71
130.76
134.49
138.32
142.28
146.36
150.56
153.97
Season 3 - (100.00 %)
Mils/kWh
75.65
77.77
80.05
81.95
83.90
85.90
88.05
90.14
92.40
94.59
96.84
99.15
101.51
103.94
106.42
108.97
112.07
115.27
118.57
121.97
125.47
128.31
7.4 Surlus Energy Price - For all Surplus Energy, Idaho Power shall pay to the Seller the current month's
Market Energy Reference Price or the All Hours Energy Price specified in paragraph 7.3, whichever is
lower.
7.5 Inadvertent Energy -
7.5.1 Inadvertent Energy is electric energy produced by the Facility, expressed in kWh, which the
Seller delivers to Idaho Power at the Point of Delivery that exceeds 10,000 kW multiplied
by the hours in the specific month in which the energy was delivered. (For example
Januar contains 744 hours. 744 hours times 10,000 kW = 7,440,000 kWh. Energy
delivered in Januar in excess of 7,440, 000 kWh in this example would be Inadvertent
Energy.)
7.5.2 Although Seller intends to design and operate the Facility to generate no more than
10 average MW and therefore does not intend to generate Inadvertent Energy, Idaho Power
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wil accept Inadvertent Energy that does not exceed the Maximum Capacity Amount but
wil not purchase or pay for Inadvertent Energy.
7.6 Payment Due Date - Undisputed Energy payments, less any payments due to Idaho Power wil be
disbursed to the Seller within 30 days of the date which Idaho Power receives and accepts the
documentation of the monthly Net Energy actually delivered to Idao Power as specified in
Appendix A.
7.7 Continuing Jurisdiction of the Commission -This Agreement is a special contract and, as such, the rates,
terms and conditions contained in this Agreement wil be construed in accordace with Idaho Power
Company v. Idaho Public Utilties Commission and Afton Energy, Inc., 107 Idaho 781, 693 P.2d 427
(1984), Idaho Power Company v. Idaho Public Utilities Commission, 107 Idaho 1122,695 P.2d 1 261
(1985), Afton Energy, Inc, v. Idaho Power Company, 111 Idaho 925, 729 P.2d 400 (1986), Section 210
of the Public Utilities Regulatory Policies Act of 1978 and 18 CFR §292.303-308
ARTICLE VII: ENVIRONMENTAL ATTRIUTES
8.1 Seller retains ownership under this Agreement of Green Tags, Renewable Energy Certificate (RCs),
carbon credits, or the equivalent envionmental attributes, directly associated with the production of
energy from the Seller's Facilty sold to Idaho Power.
ARTICLE IX: FACILITY AN INTERCONNCTION
9.1 Design of Facility - Seller wil design, construct, install, own, operate and maintain the Facility and any
Seller-owned Interconnection Facilities so as to allow safe and reliable generation and delivery of Net
Energy and Inadvertent Energy to the Idaho Power Point of Delivery for the full term of the Agreement.
ARTICLE X: METERIG AND TELEMETRY
10.1 Metering - Idaho Power shall, for the account of Seller, provide, install, and maintain Meterig
Equipment to be located at a mutually agreed upon location to record and measure power flows to Idao
Power in accordance with this Agreement and Schedule 72. The Metering Equipment wil be at the
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location and the type required to measure, record and report the Facility's Net Energy, Station Use,
Inadvertent Energy and maximum energy deliveries (kW) at the Point of Delivery in a manner to
provide Idaho Power adequate energy measurement data to administer this Agreement and to integrate
this Facility's energy production into the Idaho Power electrical system.
10.2 Telemetry - Idaho Power wil install, operate and maintain at Seller's expense communications and
telemetry equipment which wil be capable of providing Idaho Power with continuous instantaeous
telemetry of Seller's Net Energy and Inadvertent 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, Inadvertent Energy and maximum
generation (kW) records in a form and content acceptable to Idaho Power.
11.2 Inspection - Either Pary, after reasonable notice to the other Pary, shall have the right, durng normal
business hours, to inspect and audit any or all generation, Net Energy, Station Use, Inadvertent Energy
and maximum generation (kW) records pertaining to the Seller's Facilty.
ARTICLE XII: OPERATIONS
12 .1 Communications - Idaho Power and the Seller shall maintain appropriate operating communications
through Idaho Power's Designated Dispatch Facility in accordance with Appendix A of this Agreement.
12 .2 Energy Acceptance -
l2.2.1 Idaho Power shall be excused from accepting and paying for Net Energy or accepting
Inadvertent Energy which would have otherwise been produced by the Facility and delivered by
the Seller to the Point of Delivery, if it is prevented from doing so by an event of Force
Majeure, or temporary disconnection of the Facility in accordace with Schedule 72. If, for
reasons other than an event of Force Majeure, a temporar disconnection under Schedule 72
exceeds twenty (20) days, beginning with the twenty-first day of such interrption, curailment
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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 6.2. Idaho
Power wil notify Seller when the interrption, curailment or reduction is terinated.
12.2.2 If, in the reasonable opinion ofIdaho Power, Seller's operation of the Facility or Interconnection
Facilities is unsafe or may otherwise adversely affect Idaho Power's equipment, personnel or
service to its customers, Idaho Power may temporarily disconnect the Facility from Idaho
Power's transmission/distrbution system as specified within Schedule 72 or take such other
reasonable steps as Idaho Power deems appropriate.
12.2.3 Under no circumstances wil the Seller deliver Net Energy and/or Inadvertent Energy from the
Facility to the Point of Delivery in an amount that exceeds the Maximum Capacity Amount.
Seller's failure to limit deliveries to the Maximum Capacity Amount wil be a Material Breach
of this Agreement.
12.2.4 If Idaho Power is unable to accept the energy from this Facility and is not excused from
accepting the Facilty's energy, Idao Power's damages shall be limited to only the value of the
estimated energy that Idaho Power was unable to accept. Idaho Power will have no
responsibility to pay for any other costs, lost revenue or consequential damages the Facility may
incur.
12.3 Seller Declared Suspension of Energy Deliveries
12.3.1 If the Seller's Facility experiences a forced outage due to equipment failure which is not caused
by an event of Force Majeure or by neglect, disrepair or lack of adequate preventative
maintenance of the Seller's Facility, Seller may, after giving notice as provided in pargraph
12.3.2 below, temporarily suspend all deliveries of Net Energy to Idaho Power from the Facilty
or from individual generation unites) within the Facilty impacted by the forced outage for a
period of not less than 48 hours to correct the forced outage condition ("Declared Suspension of
Energy Deliveries"). The Seller's Declared Suspension of Energy Deliveries wil begin at the
star of the next full hour following the Seller's telephone notification as specified in paragraph
12.3.2 and wil continue for the time as specified (not less than 48 hour) in the wrtten
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notification provided by the Seller. In the month(s) in which the Declared Suspension of Energy
occured, the Net Energy Amount wil be adjusted as specified in paragraph 6.2.4.
12.3.2 If the Seller desires to initiate a Declared Suspension of Energy Deliveries as provided in
paragraph 12.3.1, the Seller wil notify the Designated Dispatch Facility by telephone. The
beginning hour of the Declared Suspension of Energy Deliveries wil be at the earliest the next
full hour after makig telephone contact with Idao Power. The Seller wil, within 24 hours
after the telephone contact, provide Idaho Power a wrtten notice in accordance with XXIV that
wil contain the beginng hour and duration of the Declared Suspension of Energy Deliveries
and a description of the conditions that caused the Seller to initiate a Declared Suspension of
Energy Deliveries. Idaho Power wil review the documentation provided by the Seller to
determine Idaho Power's acceptance of the described forced outage as qualifyng for a Declared
Suspension of Energy Deliveries as specified in paragraph 12.3.1. Idaho Power's acceptance of
the Seller's forced outage as an acceptable forced outage wil be based upon the clear
documentation provided by the Seller that the forced outage is not due do an event of Force
Majeure or by neglect, disrepair or lack of adequate preventative maintenance of the Seller's
Facility.
12.4 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 calendar year and Idao
Power and Seller shall mutually agree as to the acceptability of the proposed schedule. The Paries
determination as to the acceptability of the Seller's timetable for scheduled maintenance wil take into
consideration Prudent Electrical Practices, Idaho Power system requirements and the Seller's preferred
schedule. Neither Party shall unreasonably withhold acceptance of the proposed maintenance schedule.
12.5 Maintenance Coordination - The Seller and Idaho Power shall, to the extent practical, coordinate their
respective line and Facility maintenance schedules such that they occur simultaneously.
12.6 Contact Prior to Curilment - Idaho Power wil make a reasonable attempt to contact the Seller prior to
exercising its rights to interrpt interconnection or curtail deliveries from the Seller's Facilty. Seller
understands that in the case of emergency circumstances, real time operations of the electrical system,
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and/or unplaned events Idaho Power may not be able to provide notice to the Seller prior to
interrption, curtailment, or reduction of electrical energy deliveries to Idaho Power.
ARTICLE XII: INEMNIFICATION AN INSURNCE
13.1 Indemnification - Each Pary shall agree to hold harless and to indemnify the other Party, its officers,
agents, affliates, subsidiares, parent company and employees against all loss, damage, expense and
liability to third persons for injury to or death of person or injur to property, proximately caused by the
indemnifyng Party'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, errrs or omissions. The indemnfyng Pary shall, on the other Pary's request, defend any suit
asserting a claim covered by this indemnity. The indemnifyng Party shall pay all documented costs,
including reasonable attorney fees that may be incurred by the other Pary in enforcing this indemnity.
13.2 Insurance - During the term of this Agreement, Seller shall secure and continuously car the following
insurance coverage:
13.2.1 Comprehensive General Liability Insurance for both bodily injury 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 Insurance Industry Utilty practices for similar
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 liabilty
reduced without sixty (60) days' prior written notice to Idaho Power.
13.3 Seller to Provide Certificate of Insurance - As required in paragraph 4.1.5 herein and annually
thereafter, Seller shall furnish Idaho Power a certificate of insurace, together with the endorsements
required therein, evidencing the coverage as set forth above.
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13.4 Seller to Notify Idaho Power of Loss of Coverage - If the insurance coverage required by paragraph
13.2 shall lapse for any reason, Seller wil immediately notify Idaho Power in writing. The notice wil
advise Idaho Power of the specific reason for the lapse and the steps Seller is takng 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.
ARTICLE XIV: FORCE MAJUR
14.1 As used in this Agreement, "Force Majeure" or "an event of Force Majeure" means any cause beyond
the control of the Seller or of Idaho Power which, despite the exercise of due diligence, such Party is
unable to prevent or overcome. Force Majeure includes, but is not limited to, acts of God, fire, flood,
storms, war, hostilities, civil strife, strkes and other labor disturbances, earhquakes, fires, lightning,
epidemics, sabotage, or changes in law or regulation occurng after the effective date, which, by the
exercise of reasonable foresight such party could not reasonably have been expected to avoid and by the
exercise of due dilgence, it shall be unable to overcome. If either Pary is rendered wholly or in par
unable to perform its obligations under this Agreement because of an event of Force Majeure, both
Parties shall be excused from whatever performance is affected by the event of Force Majeure, provided
that:
(1) The non-performing Party shall, as soon as is reasonably possible after the occurrence
of the Force Majeure, give the other Pary written notice describing the particulars of
the occurrence.
(2) The suspension of performance shall be of no greater scope and of no longer duration
than is required by the event of Force Majeure.
(3) No obligations of either Party which arose before the occurence causing the suspension
of performance and which could and should have been fully performed before such
occurence shall be excused as a result of such occurence.
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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 liabilty to any person not a Party to this Agreement. Neither
party shall be liable to the other for any indirect, special, consequential, nor punitive damages, except as
expressly authorized by this Agreement. Consequential damages wil include, but not be limited to, the
value of renewable energy certificate and, if the Facility is fueled by gas produced by an anaerobic
digester system, any diminution or loss of anaerobic activity due to the inability of Idaho Power to
accept energy from the Facility.
15.2 Dedication. No undertaking by one Party to the other under any provision of this Agreement shall
constitute the dedication of that Party's system or any portion thereof to the Pary 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 liabilties
of the Parties are intended to be several and not joint or collective. Nothing contained in this Agreement
shall ever be construed to create an association, trust, parnership or joint ventue or impose a trust or
parnership duty, obligation or liabilty on or with regard to either Pary. Each Pary 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 Party of its rights with respect to a default under this Agreement or
with respect to any other matters arising in connection with this Agreement shall not be deemed a
waiver with respect to any subsequent default or other matter.
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ARTICLE XVII: CHOICE OF LAWS AN VENU
18.1 This Agreement shall be construed and interreted in accordace with the laws of the State ofIdaho
without reference to its choice of law provisions.
18.2 Venue for any litigation arising out of or related to this Agreement wil lie in the District Cour of the
Fourth Judicial District of Idaho in and for the County of Ada.
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 to the Commission for
resolution.
19.2 Notice of Default
19.2.1 Defaults. If either Pary fails to perform any of the terms or conditions of this Agreement
(an "event of default"), the nondefaulting Pary shall cause notice in writing to be given to
the defaulting Party, specifying the maner in which such default occurred. If the defaulting
Party 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 other Pary that the default can be
cured within a commercially reasonable time but not withi such sixty (60) day period and
then fails to diligently pursue such cure, then, the nondefaulting Party may, at its option,
terminate this Agreement and/or pursue its legal or equitable remedies.
Material Breaches - The notice and cure provisions in paragraph 19.2.1 do not apply to
defaults identified in this Agreement as Material Breaches. Material Breaches must be cured
as expeditiously as possible following occurrence of the breach.
19.3 Security for Performance - Prior to the Operation Date and thereafter for the full term of this
19.2.2
Agreement, Seller wil provide Idaho 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 supplying
evidence that the required insurance coverage has been replaced or reinstated;
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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
required certificate wil be an event of default. Such a default may only be cured by Seller
providing the required certificate; and
19.3.3 Licenses and Permits - During the full ter of this Agreement, Seller shall maintain
compliance with all permits and licenses described in paragraph 4.1.1 of this Agreement. In
addition, Seller wil supply Idaho Power with copies of any new or additional permts or
licenses. At least every fifth Contract Year, Seller wil update the documentation described
in Paragraph 4.1.1. If at any time Seller fails to maintain compliance with the 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 Idaho Power evidence of compliance from the permitting agency.
ARTICLE XX: GOVERNENTAL AUTHORIATION
20.1 This Agreement is subject to the jursdiction of those governental agencies having control over either
Party of this Agreement.
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 incurred expenses for ratemaking purposes.
ARTICLE XXII: SUCCESSORS AN ASSIGNS
22.1 This Agreement and all of the terms and provisions hereof shall be binding upon and inure to the benefit
of the respective successors and assigns of the Parties hereto, except that no assignment hereofby either
Pary shall become effective without the wrtten consent of both Paries being first obtained. Such
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consent shall not be uneasonably withheld. Notwithstanding the foregoing, any pary which Idao
Power may consolidate, or into which it may merge, or to which it may conveyor transfer substantially
all of its electric utilty assets, shall automatically, without further act, and without need of consent or
approval by the Seller, succeed to all of Idaho Power's rights, obligations and interests under this
Agreement. 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. Idaho Power shall have the right
to be notified by the financing entity that it is exercising such rights or remedies.
ARTICLE XXII: MODIFICATION
23.1 No modification to this Agreement shall be valid unless it is in writing and signed by both Parties and
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 Facilty or the Interconnection Facilties.
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:
AgPower Jerome, LLC
ATT: Jim Wiest, Manager
10475 E. Park Meadows Drve
Suite 600
Lone Tree, Colorado 80124
Telephone: [phone]FAX: [phone]
E-mail: jim.wiest~camcoglobai.com
Copy of document to:
Cenergy USA, Inc.
11500 N. Rodney Parham Road
Suite 9
Little Rock, Arkansas 72212
Telephone: [phone]
FAX: [phone]
E-mail: tedsfla~sbcglobai.net
E-mail: eh1996a~aoi.com
To Idaho Power:
Original document to:
Vice President, Power Supply
Idaho Power Company
POBox 70
Boise, Idaho 83707
Email: LGgrow~idahopower.com
Copy of document to:
Cogeneration and Small Power Production
Idao Power Company
POBox 70
Boise, Idaho 83707
E-mail: rallphin~idahopower.com
Either Pary may change the contact person and/or address information listed above, by providing written notice
from an authorized person representing the Party.
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ARTICLE XXVI: ADDITIONAL TERMS AN CONDITIONS
26.1 This Agreement includes the following appendices, which are attached hereto and included by
reference:
Appendix A
AppendixB
AppendixC
AppendixD
Generation Scheduling and Reporting
Facilty and Point of Delivery
Engineer's Certifications
Forms of Liquid Security
ARTICLE XXVII: SEVERAILITY
27.1 The invalidity or unenforceabilty of any term or provision of this Agreement shall not affect the
validity or enforceabilty of any other terms or provisions and this Agreement shall be construed in all
other respects as if the invalid or unenforceable term or provision were omitted.
ARTICLE XXVII: COUNERPARTS
28.1 This Agreement may be executed in two or more counterparts, each of which shall be deemed an
original but all of which together shall constitute one and the same instruent.
ARTICLE 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 concernng the
subject matter hereof.
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IN WITNSS WHEREOF, The Paries hereto have caused this Agreement to be executed in
their respective names on the dates set forth below:
Idaho Power Company AgPower Jerome, LLC
By By ~
Lisa A Grow Jim Wiest
Sr. Vice President, Power Supply Manager
Dated 10'IS-(0 Dated Ø#d
"Idaho Power""Sellet'
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APPENDIX A
A -1 MONTLY POWER PRODUCTION AN SWITCHING 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 Facility's total energy production and Station Usage delivered to Idaho Power and the maximum generated
energy (kW) as recorded on the Metering 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 inormation that wil be
gathered as described in item A-2 below:
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Idaho Power Company
Cogeneration and Small Power Production
MONTm Y POWER PRODUCTION AND SWITCHING REPORT
Project Name
Month Year
Project Number:
Address
ZipCity
Meter Number:
End of Month kWh Meter Reading:
Beginng of Month kWh Meter:
Difference:
Times Meter Constant:
kWh for the Month:
Metered Demand:
Breaker Opening Record
Date Time Meter
*Breaker Opening Reason Codes
Lack of Adequate Prime Mover
Forced Outage of Facilty
Disturbance of IPCo System
Scheduled Maintenance
Testing of Protection Systems
Cause Unknown
Other (Explain)
i
2
3
4
5
6
7
State
Facilty
Output
Station
Usage
*Reason
Phone Number:
Station
Usage
Metered
Maximum Generation
kW
Net Generation
Breaker Closing Record
Date Time Meter
I hereby certify that the above meter readings are
true and correct as of Midnight on the last day of the
above month and that the switching record is accurate
and complete as required by the Firm Energy Sales
Agreement to which I am a Party.
Signature
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A-2 AUTOMATED METER READING COLLECTION PROCESS
Monthly, Idaho Power wil use the provided Metering and Telemetry equipment and processes to collect the
meter reading information from the Idaho Power provided Meterng Equipment that measures the Net Energy
and energy delivered to supply Station Use for the Facility 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 manner
for a reasonable period of time, the Parties may mutually agree to modify this Routine Reporting
requirement.
Idaho 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
. Curent Meter Reading
. Estimated Generation for the current day
. Estimated Generation for the next day
Planned and Unplaned Project outages
Call 1-800-345-1319 and leave the following information:
. Project Identification - Project Name and Project Number
· Approximate time outage occured
. 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:
Brad Weg
208-320-0636
208-320-0636
Project On-site Contact inormation
Name:
Telephone Number:
Same as above
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APPENDIXB
FACILITY AN POIN OF DELIVERY
Project Name: Double A Digester Project
Project Number:
B-1 DESCRITION OF FACILITY
(Must include the Nameplate Capacity rating and V AR capabilty (both leading and lagging) of all generation
units to be included in the Facility.)
Three (3) Caterpilar Model 868 Generator with Nameplate Capacity of 1.6 MW each but operating
At 1.5 MW each due to operating capacity of the prime mover at site elevation.
Var Capabilty (Both leading and laggng) Leading is _ N/ A_Lagging is .8 PF
B-2 LOCATION OF FACILITY
Near: Jerome, Idaho
Sections: 32 Township: 6 South Range: 17 East County: Lincoln, ID.
Description of Interconnection Location: East side of digester mechanical building
Nearest Idao Power Substation: Notch Butte
B-3 SCHEDULED FIRST ENERGY AN OPERATION DATE
Seller has selected June 1, 2011 as the Scheduled First Energy Date.
Seller has selected January 1, 2012 as the Scheduled Operation Date. In making these selections, Seller
recognizes that adequate testing of the Facility and completion of all requirements in paragrph 5.2 of
this Agreement must be completed prior to the project being granted an Operation Date.
B-4 MAXIMUM CAPACITY AMOUN:
This value wil be 4.5 MW which is consistent with the value provided by the Seller to Idaho Power in
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accordance with Schedule 72. This value is the maximum energy (MW) that potentially could be
delivered by the Seller's Facility to the Idaho Power electrical system at any moment in time.
B-5 POIN OF DELIVERY
"Point of Delivery" means, unless otherwise agreed by both Paries, the point of where the Sellers
Facility's energy is delivered to the Idao Power electrical system. Schedule 72 wil determine the
specific Point of Delivery for this Facility. The Point of Delivery identified by Schedule 72 wil become
an integral par of this Agreement.
B-6 LOSSES
If the Idaho Power Meterig equipment is capable of measurig 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
Facilty. If the Idaho Power Meterg is unable to measure the exact energy deliveries by the Seller to
the Idaho Power electrical system at the Point of Delivery, a Losses calculation wil be established to
measure the energy losses (kWh) between the Seller's Facility and the Idao Power Point of Delivery.
This loss calculation wil be initially set at 2% of the kWh energy production recorded on the Facility
generation metering equipment. At such time as Seller provides Idaho Power with the electrcal
equipment specifications (transformer loss specifications, conductor sizes, etc) of all of the electrcal
equipment between the Facility and the Idaho Power electrical system, Idaho Power wil configure a
revised loss calculation formula to be agreed to by both paries and used to calculate the kWh Losses for
the remainig term of the Agreement. If at any time during the term of this Agreement, Idaho 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 months kWh loss calculations.
B-7 METERIG AN TELEMETRY
Schedule 72 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
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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 Idaho 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. Idaho 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 accordance with Schedule
72 and the total metering cost wil be included in the calculation of the Monthly Operation and
Maintenance Charges specified in Schedule 72.
B-8 NETWORK RESOURCE DESIGNATION
Idaho Power cannot accept or pay for generation from this Facility until a Network Resource
Designation ("NR") application has been accepted by Idaho Power's delivery business unit. Federal
Energy Regulatory Commission ("FERC") Rules require Idaho Power to prepare and submit the NR.
Because much of the information Idaho Power needs to prepare the NR is specific to the Seller's
Facilty, Idaho Power's ability to fie the NR in a timely manner is contingent upon timely receipt of
the required information from the Seller. Prior to Idaho Power beginning 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 Paragraph 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 referred to as "Engineer," hereby states and certifies to the Seller as follows:
1. That Engineer is a Licensed Professional Engineer in good stading in the State ofIdaho.
2. That Engineer has reviewed the Energy Sales Agreement, hereinafter "Agreement," between Idaho
Power as Buyer, and as Seller, dated
3. That the cogeneration or small power production project which is the subject of the Agreement and this
Statement is identified as IPCo Facilty No. and is hereinafter referred to as the "Project."
4. That the Project, which is commonly known as the Project, is located in
Section _ Township Range , Boise Meridian, County, Idaho.
5. That Engineer recognzes that the Agreement provides for the Project to furnish electrical energy to
Idaho Power for a year period.
6. That Engineer has substantial experience in the design, construction and operation of electric power
plants of the same type as this Project.
7. That Engineer has no economic relationship to the Design Engineer of this Project.
8. That Engineer has reviewed and/or supervsed the review of the Policy for Operation and Maintenance
("O&M") for this Project and it is his professional opinion that, provided said Project has been designed and
built to appropriate standards, adherence to said O&M Policy wil result in the Project's producing at or near the
design electrical output, efficiency and plant factor for a fifteen (15) year period.
9. That Engineer recognizes that Idaho Power, in accordance with paragraph 5.2 of the Agreement, is
relyig on Engineer's representations and opinions contained in this Statement.
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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 himself and
hereinafter collectively referred to as "Engineer," hereby states and certifies to
the Seller as follows:
1. That Engineer is a Licensed Professional Engineer in good standing in the State of Idaho.
2. That Engineer has reviewed the Energy Sales Agreement, hereinafter "Agreement," between Idao
Power as Buyer, and as Seller, dated
3. That the cogeneration or small power production project which is the subject of the Agreement and this
Statement is identified as IPCo Facility No. and hereinafter referred to as the "Project".
4. That the Project, which is commonly known as the Project, is located in
Section _ Township Range , Boise Meridian, County, Idaho.
5. That Engineer recognizes that the Agreement provides for the Project to furnish electrical energy to
Idaho Power for a fifteen (15) year period.
6. That Engineer has substantial experience in the design, construction and operation of electric power
plants of the same type as this Project.
7. That Engineer has no economic relationship to the Design Engineer of this Project.
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8. That Engineer has made a physical inspection of said Project, its operations and maintenance records
since the last previous certified inspection. It is Engineer's professional opinion, based on the Project's
appearance, that its ongoing O&M has been substantially in accordance with said O&M Policy; that it is in
reasonably good operating condition; and that if adherence to said O&M Policy continues, the Project wil
continue producing at or near its design electrical output, effciency and plant factor for the remaining
year of the Agreement.
9. That Engineer recognizes that Idaho Power, in accordance with paragraph 5.2 of the Agreement, is
relying on Engineer's representations and opinions contained in this Statement.
10. That Engineer certifies that the above statements are complete, true and accurate to the best of his
knowledge and therefore sets his hand and seal below.
By
(P .E. Stamp)
Date
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APPENDIXC
ENGINER'S CERTIFICATION
OF
DESIGN & CONSTRUCTION ADEQUACY
The undersigned on behalf of himself and
hereinafter collectively referred to as "Engineer", hereby states and cerifies to
Idaho Power as follows:
1.
2.
That Engineer is a Licensed Professional Engineer in good standing in the State ofIdaho.
That Engineer has reviewed the Firm Energy Sales Agreement, hereinafter "Agreement",
between Idaho Power as Buyer, and as Seller, dated
3. That the cogeneration or small power production project, which is the subject of the Agreement
and this Statement, is identified as IPCo Facility No and is hereinafter referred to as the
"Project".
4. That the Project, which is commonly known as the Project, is located in
Section _ Township Range , Boise Meridian, County, Idao.
5. That Engineer recognzes that the Agreement provides for the Project to fuish electrical
energy to Idaho Power for a fifteen (15) 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 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, electrical work, generating equipment, prime mover conveyance system, Seller fuished
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 year period.
11.That Engineer recognizes that Idao Power, in accordance with paragraph 5.2 of the Agreement,
in interconnecting the Project with its system, is relying on Engineer's representations and opinions contained in
this Statement.
12. That Engineer certifies that the above statements are complete, tre and accurate to the best of
his knowledge and therefore sets his hand and seal below.
By
(P.E. Stamp)
Date
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APPENDIXD
FORMS OF LIQUID SECURY
The Seller shall provide Idao Power with commercially reasonable securty instruents 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 Securty
requirement withi this Agreement.
For the purose of this Appendix D, the term "Credit Requirements" shall mean acceptable financial
creditworthiness of the entity providing the security instruent in relation to the term of the obligation
in the reasonable judgment of Idao Power, provided that any guarantee and/or letter of credit issued by
any other entity with a short-term or long-term investment grade credit rating by Standard & Poor's
Corporation or Moody's Investor Services, Inc. shall be deemed to have acceptable financial
creditworthiness.
1. Cash Escrow Security - Seller shall deposit fuds in an escrow account established by the Seller in
a banng institution acceptable to both Paries equal to the Delay Security.
2. Guarantee or Letter of Credit Security - Seller shall post and maintain in an amount equal
to the Delay Security: (a) a guaranty from a pary that satisfies the Credit Requirements, in
a form acceptable to Idaho Power at its discretion, or (b) a Letter of Credit in a form
acceptable to Idaho Power, in favor ofIdaho Power. The Letter of Credit wil be issued by
a financial institution acceptable to both paries.
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