20101124notice_of_applications_order_no_32123.pdf

Office of the Secretary
Service Date
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
November 24 2010
IN THE MATTER OF THE APPLICATION OF
IDAHO POWER COMPANY FOR APPROVAL
OF A FIRM ENERGY SALES AGREEMENT
BETWEEN IDAHO POWER AND COLD
SPRINGS WIND FARM, LLC
IN THE MATTER OF THE APPLICATION OF
IDAHO POWER COMPANY FOR APPROVAL
OF A FIRM ENERGY SALES AGREEMENT
BETWEEN IDAHO POWER AND DESERT
MEADO W WIND FARM, LLC
IN THE MATTER OF THE APPLICATION OF
IDAHO POWER COMPANY FOR APPROVAL
OF A FIRM ENERGY SALES AGREEMENT
BETWEEN IDAHO POWER AND HAMMETT
HILL WIND FARM, LLC
IN THE MATTER OF THE APPLICATION OF
IDAHO POWER COMPANY FOR APPROV AL
OF A FIRM ENERGY SALES AGREEMENT
BETWEEN IDAHO POWER AND MAINLINE
WIND FARM, LLC
IN THE MATTER OF THE APPLICATION OF
IDAHO POWER COMPANY FOR APPROVAL
OF A FIRM ENERGY SALES AGREEMENT
BETWEEN IDAHO POWER AND RYEGRASS
WINDF ARM, LLC
IN THE MATTER OF THE APPLICATION OF
IDAHO POWER COMPANY FOR APPROVAL
OF A FIRM ENERGY SALES AGREEMENT
BETWEEN IDAHO POWER AND TWO PONDS
WIND FARM, LLC
NOTICE OF APPLICATIONS
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 32123
) CASE NO. IPC-10-
) CASE NO. IPC-10-
) CASE NO. IPC-10-
) CASE NO. IPC-10-
) CASE NO. IPC-10-
) CASE NO. IPC-10-
) NOTICE OF APPLICATIONS
) NOTICE OF
) MODIFIED PROCEDURE
) ORDER NO. 32123
On November 16, 2010 , Idaho Power Company filed six Applications requesting
approval of six 20-year Firm Energy Sales Agreements (FESAs) between Idaho Power and Cold
Springs Windfarm, LLC; Desert Meadow Windfarm, LLC; Hammett Hill Windfarm, LLC;
Mainline Windfarm, LLC; Ryegrass Windfarm, LLC; and Two Ponds Windfarm, LLC. The six
projects are all located near Mountain Horne, Idaho. The Applications are nearly identical and
recite that each wind generating project will have a maximum capacity amount of 23 MW. The
projects will all be "qualifying facilities" (QFs) under the applicable provisions of the federal
Public Utility Regulatory Policies Act of 1978 (PURP A).
THE FIRM ENERGY SALES AGREEMENTS
On November 12 2010, Idaho Power and each of the six wind projects entered into
their respective FESAs. The Applications maintain that the terms and conditions of the FESAs
comport with the Commission s Orders applicable to PURP A wind projects. Application at 2
citing Order Nos. 30415 , 30488, 30738, and 30744. Under the terms of the FESAs, the wind
projects agree to sell energy to Idaho Power for a 20-year term using the current non-Ievelized
published avoided cost rates as currently established by the Commission in Order No. 31025 for
energy deliveries of less than 10 aMW. The six FESAs were executed by the developer on
November 2, 2010. I Idaho Power requests that the Applications be processed under Modified
Procedure.
1. Output.The nameplate rating for each of the six wind projects is 23 MW.
defined in Sections 1.17 and 4.3 of the FESA , each wind project will be required to provide
data to Idaho Power to confirm under normal and/or average conditions, that each project will
not exceed 10 aMW on a monthly basis. Application at ~ 4. Should the project exceed 10 aMW
on a monthly basis, Idaho Power will accept the energy "that does not exceed 23 MW on a
monthly basis, but will not pay for the energy that exceeds 10 aMW on a monthly basis.Id.
2. Mechanical Availability Guarantee . The parties' Agreement contains a MAG
calculation in conformance with Commission Order No. 30488 (Case No. IPC-07-03). The
MAG provision approved in Order No. 30488 provides that the wind project demonstrate each
month (except for scheduled maintenance and force majeure events) that the wind project
physically capable of generating at full output during 85% of the hours in the month. Failure to
1 Although Idaho Power filed a Joint Petition on November 5, 20 I 0, seeking a reduction in the published avoided
cost rate eligibility cap from 10 MW to 100 kW, the Company believes that these six FESAs "should not be
impacted by that filing." Application at ~ 3.
NOTICE OF APPLICATIONS
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 32123
comply with the Mechanical Availability Guarantee would result in the payment of liquidated
damages." Order No. 30488 at
3. Damages and Security. The parties have agreed to Delay Liquidated Damages and
associated Delay Security provisions of$45 per kW of nameplate capacity.
4. Operational Date. Each FESA provides that the "Scheduled First Energy Date" is
December 31 , 2011 , and the "Scheduled Operation Date" is December 31 , 2012. Application at
~ 6. The Agreements further provide that it is the wind developer s responsibility to work with
Idaho Power s Delivery business unit to ensure that there is sufficient time and resources for
Idaho Power to construct the necessary "interconnection facilities, and transmission upgrades if
required, in time to allow that (project) to achieve the December 31 , 2011 , Scheduled Operation
Date." Application at ~ 9. Delay damages may be assessed if the wind developer is unable to
obtain the necessary interconnection facilities and transmission upgrade (if necessary). Idaho
Power anticipates that it will provide the wind developer a "Facility Study Report" containing
the technical information and payment schedules for the interconnection materials no later than
January 7, 2011. Id. at ~ 8. Following the delivery of the Facility Study Report, the parties must
then enter into a Generator Interconnection Agreement. The Applications acknowledge that
Idaho Power can accommodate the output from the six wind projects without transmission
network upgrades. Id.
5. Energy Price. The parties ' FESAs provide for non-Ievelized published avoided
cost rates. The rates for the non-Ievelized energy are in accordance with the Commission
Order No. 31025, as adjusted by Order No. 30415 for heavy load and light load energy delivery;
and further adjusted in accordance with Commission Order No. 30488 for wind integration
charges and with seasonalized factors set out in Section 7 of the FESA. In addition, the
Agreements note that the developers will be responsible for paying applicable interconnection
charges and monthly operation and maintenance charges under Idaho Power s Schedule 72.
6. Interconnection. Each of the FESAs states that the wind projects will interconnect
with Idaho Power s transmission network via a single 230 kV line at T4S, R9E, SEC 21 in
Elmore County.
7. Effective Date. The FESAs will not become effective until the Commission has
approved all of the FESAs terms and conditions and declares that all payments made by Idaho
NOTICE OF APPLICATIONS
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 32123
Power to the wind projects for purchases of energy will be allowed as prudently incurred
expenses for ratemaking purposes. Agreement ~ 21.
NOTICE OF MODIFIED PROCEDURE
YOU ARE HEREBY NOTIFIED that the Commission has determined that the public
interest may not require a formal hearing for these six Applications and will proceed under
Modified Procedure pursuant to Rules 201 through 204 of the Idaho Public Utilities
Commission s Rules of Procedure, IDAPA 31.01.01.201 through .204. The Commission notes
that Modified Procedure and written comments have proven to be an effective means for
obtaining public input and participation.
YOU ARE FURTHER NOTIFIED that the six Applications have been filed with the
Commission and are available for public inspection during regular business hours at the
Commission offices. The Applications are also available on the Commission s web site at
www.puc.idaho.gov by clicking on "File Room" and then "Electric Cases.
YOU ARE FURTHER NOTIFIED that any person desiring to state a position on
these Applications or any individual Application may file a written comment in support or
opposition with the Commission within 21 days from the date of this Order. The comment
must contain a statement of reasons supporting the comment. Persons desiring a hearing must
specifically request a hearing in their written comments. Written comments concerning any of
these Applications shall be mailed to the Commission and Idaho Power at the addresses reflected
below:
Commission Secretary
Idaho Public Utilities Commission
PO Box 83720
Boise, ID 83720-0074
Street Address for Express Mail:
472 W. Washington Street
Boise, ID 83702-5918
NOTICE OF APPLICATIONS
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 32123
Donovan E, Walker, Senior Counsel
Lisa Nordstrom, Lead Counsel
Idaho Power Company
1221 West Idaho Street
PO Box 70
Boise, ID 83707-0070
Mail: dwalker~idahopower.com
lnords trom~i dahopower. corn
Randy C. Allphin
Energy Contract Administrator
Idaho Power Company
1221 West Idaho Street
PO Box 70
Boise, ID 83707-0070
Mail: rallphin~idahopower.com
Comments should contain the case captions and case numbers shown on the first page of this
document.Persons desiring to submit comments via e-mail may do so by accessing the
Commission s home page located at www.puc.idaho.gov. Click the "Comments and Questions
icon and complete the comment form using the case numbers as it appears on the front of this
document. These comments must also be sent to Idaho Power at the e-mail addresses listed
above.
YOU ARE FURTHER NOTIFIED that Idaho Power may file reply comments (if
necessary) no later than 23 days after the service date of this Order.
YOU ARE FURTHER NOTIFIED that if no written comments or protests are
received within the time limit set, the Commission will consider the six Applications on their
merits and enter its Order without a formal hearing. If written comments are received within the
time limit set, the Commission will consider them and, in its discretion, may set the same for
formal hearing.
YOU ARE FURTHER NOTIFIED that all proceedings in these cases will be held
pursuant to the Commission s jurisdiction under Title 61 of the Idaho Code and the Public Utility
Regulatory Policies Act of 1978 (PURP A). The Commission has authority under PURP A and
the implementing regulations of the Federal Energy Regulatory Commission (FERC) to set
avoided costs, to order electric utilities to enter into fixed-term obligations for the purchase of
energy from qualified facilities and to implement FERC rules.
YOU ARE FURTHER NOTIFIED that all proceedings in these Applications will be
conducted pursuant to the Commission s Rules of Procedure, IDAPA 31.01.01.000 et seq.
ORDER
IT IS HEREBY ORDERED that these cases be processed under Modified Procedure.
Interested persons and the parties may file written comments within 21 days of the date of this
Order.
IT IS FURTHER ORDERED that Idaho Power may file reply comments no later than
23 days after the date of this Order.
NOTICE OF APPLICATIONS
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 32123
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this ;J.. 3
r.P.
day of November 2010.
b: J~JI . KEM N',PREsr6E
MARSHA H. SMITH, COMMISSIONER
MACK A. REDF MMISSIONER
ATTEST:
Commission Secretary
O:IPC-IO-- 40 - 43
NOTICE OF APPLICATIONS
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 32123