20110617Application.pdf

DONOVAN E. WALKER
Lead Counsel .
dwalker(âidahopower.com
1'
IDA~POR~
An IDACORP Company
J ,-.
June 17, 2011
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-11-10
IN THE MATTER OF THE APPLICATION OF IDAHO POWER COMPANY
FOR A DETERMINATION REGARDING THE FIRM ENERGY SALES
AGREEMENT FOR THE SALE AND PURCHASE OF ELECTRIC ENERGY
BETWEEN IDAHO POWER COMPANY AND INTERCONNECT SOLAR
DEVELOPMENT LLC
Dear Ms. Jewell:
Enclosed for filng please find an original and seven (7) copies of Idaho Power
Company's Application in the above matter.
Donovan E. Walker
DEW:csb
Enclosures
1221 W. Idaho St. (83702)
P.O. Box 70
Boise, ID 83707
DONOVAN E. WALKER (ISB No. 5921)
JASON B. WILLIAMS
Idaho Power Company
1221 West Idaho Street (83702)
P.O. Box 70
Boise, Idaho 83707
Telephone: [phone]
Facsimile: [phone]
dwalkerayidahopower.com
jwilliamsayidahopower.com
RECEIVED
20 II JUN I 7 PM ~: I 5
Attorneys for Idaho Power Company
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )
OF IDAHO POWER COMPANY FOR ) CASE NO. IPC-E-11-10
A DETERMINATION REGARDING THE )
FIRM ENERGY SALES AGREEMENT FOR ) APPLICATION
THE SALE AND PURCHASE OF ELECTRIC )
ENERGY BETWEEN IDAHO POWER )
COMPANY AND INTERCONNECT SOLAR )DEVELOPMENT LLC. )
)
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 ("Commission") for an Order accepting or rejecting the Firm Energy Sales
Agreement ("FESA" or "Agreement") between Idaho Power and Interconnect Solar
Development LLC ("Interconnect Solat') under which Interconnect Solar would sell and
Idaho Power would purchase electric energy generated by the Murphy Flats Solar
Power Project ("Facilty") located near Murphy, Idaho.
In support of this Application, Idaho Power represents as follows:
APPLICATION - 1
I. BACKGROUND
1. Sections 201 and 210 of PURPA, and pertinent regulations of the Federal
Energy Regulatory Commission ("FERC"), require that regulated electric utilties
purchase power produced by cogenerators or small power producers that obtain
Qualifying Facility ("QF") status. The rate a QF receives for the sale of its power is
generally referred to as the "avoided cost" rate and is to reflect the incremental cost to
an electric utilty of electric energy or capacity or both, which, but for the purchase from
the 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 rules.
II. FIRM ENERGY SALES AGREEMENT
2. Interconnect Solar proposes to construct, own, operate, and maintain a 20
megawatt ("MW") (Maximum Capacity Amount) photovoltaic solar generating facility to
be located in Idaho Power's service territory near Murphy, Idaho. The Facilty wil be a
QF under the applicable provisions of PURPA. Idaho Power and Interconnect Solar
entered into a FESA for the sale and purchase of the energy generated by this Facility
on June 7, 2011, a copy of which is attached to this Application as Attachment No.1.
This FESA was executed by Interconnect Solar on May 31, 2011. It was subsequently
executed by Idaho Power on June 7, 2011, and now filed for the Commission's review
on June 17, 2011. This FESA contains the avoided cost rates established pursuant to
the Commission's approved Integrated Resource Plan ("IRP") avoided cost
APPLICATION - 2
methodology as currently established by the Commission for solar QFs with a design
capacity over 100 kilowatts ("kW").
3. Interconnect Solar has elected June 1, 2012, as the Scheduled First
Energy Date and July 1, 2012, as the Scheduled Operation Date for this Facilty. See
Appendix B of the attached FESA. The FESA requires Interconnect Solar to meet
various requirements in order for Idaho Power to accept energy deliveries from this
Facilty. Pursuant to the Agreement, Idaho Power wil monitor compliance with these
initial requirements. In addition, Idaho Power wil monitor the ongoing requirements
through the full term of the attached FESA.
4. The contract term specified in this Agreement is 25 years. This 25-year
contract term was a result of negotiations that attempted to balance the parties'
interests in a manner that was favorable to Idaho Power customers and to Interconnect
Solar. Some of those factors include: the project's willngness to meet performance
requirements for the full 25-year term; advantageous energy pricing for the years past
20 years; the Sellets representation that the solar panels wil have a 25-year
manufacturets warranty; and shared ownership of the Renewable Energy Certificates
("RECs") generated over the entire term of the Agreement.
5. Interconnect Solar and Idaho Power have agreed to Delay Liquidated
Damages as well as the requirement to post Delay Security. Delay Liquidated
Damages shall apply should Interconnect Solar fail to bring the Facilty on-line by the
Scheduled Operation Date as specified in the FESA. Delay Liquidated Damages are
agreed to be calculated as described hereafter. If the Operation Date occurs after the
Scheduled Operation Date, but within 90 days of that Scheduled Operation Date then
APPLICATION - 3
damages are specified as a difference between contract price and market price; if the
Operation Date occurs more than 90 days past the Scheduled Operation Date, then
damages are specified as $45 per kW of nameplate capacity for the Facility. If the
Facilty fails to achieve its Operation Date within 120 days of the Scheduled Operation
Date, the failure will be a Material Breach of the Agreement and Idaho Power may
terminate the FESA if not cured by Interconnect Solar. Interconnect Solar and Idaho
Power have also agreed to Delay Security provisions requiring Interconnect Solar to
post Delay Security in an amount equal to or exceeding $45 per kW of nameplate
capacity, or the sum of three month's estimated revenue, whichever is greater, within 30
days of Commission approval of the FESA. These Delay Damage and Security
provisions have previously been approved as reasonable by the Commission in several
PURPA FESAs. See Case Nos. IPC-E-10-02; IPC-E-10-05; IPC-E-10-15 through IPC-
E-10-19; IPC-E-10-22; IPC-E-10-24; IPC-E-10-26; IPC-E-10-37 through IPC-E-10-45;
and IPC-E-10-47 through IPC-E-10-50.
6. Interconnect Solar and Idaho Power have agreed to terms providing for
each party's 50 percent ownership of any Environmental Attributes, including RECs,
generated by the Facilty for the full 25-year term of the FESA. This has mutual benefits
for both Idaho Powets customers and the Facilty. These provisions clarify the
ownership of the Environmental Attributes generated by the Facility such that each party
can potentially maximize what benefit it can from such ownership. It clarifies the QF
developets ownership and subsequent abilty to retain RECs and obtain what value it
can for them to help offset the costs of development and operation. It also clarifies
Idaho Powets ownership and abilty to obtain what value it can for its customers, to
APPLICATION - 4
retire them and claim the Environmental Attributes of the renewable generation as part
of its system, or utilze them to meet the requirements of potential future Renewable
Portolio Standards that may require the Company to obtain and have RECs.
7. The energy prices in this Agreement are derived from Idaho Powets
AURORA economic dispatch model for this Facilty's estimated energy shape as
specified by Commission requirements for the IRP-based avoided cost methodology.
The energy price identified by the IRP methodology for this Facilty is equivalent to a 20-
year levelized price of $105.15 per megawatt-hour ("MWh"). However, the actual
energy pricing stream varies throughout the term of the contract based upon the month
and time of day during which the energy is delivered to Idaho Power. The price varies
from a low of $65.43 per MWh for Light Load energy in Season 1, 2012 - to a high Of
$173.23 per MWh for Heavy Load Peak energy in July and August of Season 2, 2037.
Furthermore, 2012 prices escalate at approximately 1.63 percent through the first 20
years of the contract (2032) then escalate at a reduced rate of 1 percent for the last 5
years of the Agreement (2037). See Sections 7.1.1, 7.1.2, 7.1.3, and 7.1.4.
8. The energy prices in this FESA contain the previously approved
differentiation between both Heavy Load and Light Load pricing, as well as different
seasonal prices. Season 1 is March, April, and May; Season 2 is July, August,
November, and December; and Season 3 is June, September, October, January, and
February. These pricing structures are standard PURPA FESA contract provisions
previously approved by the Commission. In addition, this FESA adds Heavy Load Peak
pricing to the months of July and August. See Section 7.1.3. Consequently, for the
months of July and August, the parties' negotiated pricing for this FESA includes Heavy
APPLICATION - 5
Load Standard prices, Heavy Load Peak prices, and Light Load prices. Because the
resultant pricing from the IRP methodology is dependent upon, and very sensitive to,
the energy shape provided by the Facilty as an input to the pricing model, this
additional Heavy Load Peak pricing differentiation was added as a price-based
performance guarantee measure to protect customers from overpaying for energy
based upon a specific daily load shape, should the project not operate according to that
load shape. Consequently, if the Facilty delivers the Heavy Load Peak energy
consistent with the load shape it provided to Idaho Power, and upon which the IRP-
based rates were calculated, the Facility will receive the full IRP-based avoided cost
price. Should the Facility fail to deliver the peak load energy that its IRP-based avoided
cost pricing is based upon, it wil automatically receive the lower Heavy Load Standard
price.
9. Section 21 of the FESA provides that the FESA wil not become effective
unti the Commission has approved all of the Agreement's terms and conditions and
declared that all payments Idaho Power makes to Interconnect Solar for purchases of
energy wil be allowed as prudently incurred expenses for ratemaking purposes.
II. INTERCONNECTION AND TRANSMISSION
10. Section 5.7 of the FESA provides that, prior to executing the FESA,
Interconnect Solar must have: filed for interconnection and be in compliance with all
payments and requirements of the interconnection process; received and accepted an
interconnection feasibilty study for the Facilty; provided all information required to
enable Idaho Power to file an initial transmission capacity request; accepted the results
of the initial transmission capacity request; and acknowledged responsibilty for all
APPLICATION - 6
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. Interconnect Solar is responsible to complete a Generation
Interconnection Agreement ("GIA"), and is responsible for all costs associated with
interconnection of the Facility to Idaho Powets system and any necessary transmission
upgrades for its generation to serve load. As of the time of filing this Application, Idaho
Power has completed the required studies and offered Interconnect Solar a final draft
GIA for execution. The GIA has not yet been signed, and the required payment for the
interconnection and transmission upgrades has not been paid. The GIA provides
estimated costs that must be paid as deposits in order to move forward with
construction in the following amounts: Interconnection Facilties - $170,000; Upgrades
to Distribution - $950,000; Substation Upgrades - $125,000. Additionally, the GIA sets
forth milestone dates estimating the required time frame for completion of the required
upgrades as follows: Idaho Power construction complete - 18 months after funding is
received by Idaho Power and Idaho Power commissioning complete - 2 weeks after
Idaho Power construction complete.
11. As previously stated in paragraph 3 of this Application, and set forth in
Appendix B to the FESA, Interconnect Solar has elected June 1, 2012, as the
Scheduled First Energy Date and July 1, 2012, as the Scheduled Operation Date for
this Facilty. Interconnect Solar has paid $50,000 as part of an Engineering and
Procurement Agreement in order to conduct required environmental surveys this spring
as part of the Bureau of Land Management ("BLM") federal permitting process for
construction of the required line upgrades for the Facility. However, except for this
APPLICATION - 7
estimated cost for BLM survey work, Interconnect Solar has not made the required
payment of over $1.2 milion, nor signed the GIA. As such, the estimated 18 months
required for Idaho Power to complete the interconnection and transmission facilties has
not yet begun to run.
12. Section 5.7(e) of the FESA states that the Seller (Interconnect Solar)
understands that its obligations to pay Damages and Liquidated Damages associated
with the project's failure to achieve the Operation Date by the Scheduled Operate Date
as specified in the FESA is not relieved by final interconnection or transmission
processes and schedules. Additionally, Interconnect Solar was expressly advised in
writing that the Scheduled Operation Date it selected in the FESA was prior to such time
that the interconnection/transmission facilties are scheduled to be constructed and
completed. Interconnect Solar was also expressly advised in writing that should the
project be unable to come on-line by July 1, 2012, even if the only reason that it cannot
do so is the fact that the interconnection/transmission facilties are not completed at that
time, that this wil not excuse its required performance under the FESA, nor the
forfeiture of the Delay Security that it wil be required to post. Interconnect Solar has
acknowledged this advisement and expressly agreed to and accepted all risk
associated with not meeting the Scheduled Operation Date, including forfeiture of the
Delay Security, and potential termination of the FESA. See Attachment No.2, June 7,
2011, letter to Ronald L. Wiliams.
iv. MODIFIED PROCEDURE
13. Idaho Power believes that a hearing is not necessary to consider the
issues presented herein and therefore respectfully requests that this Application be
APPLICATION - 8
processed under Modified Procedure; Le., by written submissions father than by
hearing. RP 201, et seq. If, however, the Commission determines that a technical
hearing is required, the Company stands ready to prepare and present its testimony in
such hearing.
V. COMMUNICATIONS AND SERVICE OF PLEADINGS
14. Communications and service of pleadings, exhibits, orders, and other
documents relating to this proceeding should be sent to the following:
Donovan E. Walker
Lead Counsel
Idaho Power Company
1221 West Idaho Street
P.O. Box 70
Boise, Idaho 83707
dwalkerayidahopower.com
Randy C. Allphin
Energy Contract Administrator
Idaho Power Company
1221 West Idaho Street
P.O. Bòx 70
Boise, Idaho 83707
rallphinayidahopower.com
VI. REQUEST FOR RELIEF
15. Idaho Power Company respectfully requests that the Commission issue
and Order (1) authorizing that this matter may be processed by Modified Procedure, (2)
accepting or rejecting the Firm Energy Sales Agreement between Idaho Power
Company and Interconnect Solar Development LLC, without change or condition, and, if
accepted, (3) declaring that all payments for purchases of energy under the Firm
Energy Sales Agreement between Idaho Power Company and Interconnect Solar
Development LLC be allowed as prudently incurred expenses for ratemaking purposes.
Respectfully submitted this 17th day of June 201 .
N AN E. WALKER
Attorney for Idaho Power Company
APPLICATION - 9
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on this 17th day of June 2011 I served a true and
correct copy of the within and foregoing APPLICATION upon the following named
parties by the method indicated below, and addressed to the following:
Interconnect Solar Development LLC
Randy Hemmer, Manager
Interconnect Solar Development LLC
3777 Twilight Drive
Boise, Idaho 83703
Ronald L. Wiliams
WILLIAMS BRADBURY, P.C.
1015 West Hays Street
Boise, Idaho 83702
APPLICATION - 10
Hand Delivered
-l U.S. Mail
_ Overnight Mail
FAX
-l Email randyhemmerayclearwire.net
Hand Delivered
-lU.S. Mail
_ Overnight Mail
FAX
-l Email ronaywiliamsbradburv.com
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
CASE NO.IPC-E-11-10
IDAHO POWER COMPANY
ATTACHMENT NO.1
Aricle
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FIR ENERGY SALES AGREEMENT
BETWEEN
IDAHO POWER COMPANY
AND
mTERCONNECT SOLAR DEVELOPMENT LLC
TABLE OF CONTENTS
TITLE
Definitions
No Reliance on Idaho Power
Waranties
Conditions to Acceptance of Energy
Term and Operation Date
Purchase and Sale of Net Energy
Purchase Price and Method of Payment
Environmental Attibutes
Facilty and Interconnection
Metering and Telemetr
Records
Operations
Indemnification and Insurance
Force Majeure
Liabilty; Dedication
Several Obligations
Waiver
Choice of Laws and Venue
Disputes and Default
Governmental Authorization
Commission Order
Successors and Assigns
Modification
Taxes
Notices
Additional Terms and Conditions
Severability
Counterpars
Entire Agreement Signatures
Appendix A
AppendixB
AppendixC
AppendixD
FIR ENERGY SALES AGREEMENT
(Solar Project- Greater than 100 kW)
Project Name: Murhy Flats Solar Power Project
Project Number: 12616650
THIS AGREEMENT, entered into on this 1 day of ¡11'~VJ 2011 between
7
mTERCONNECT SOLAR DEVELOPMENT LLC (Seller), and IDAHO POWER COMPANY, an Idaho
corporation (Idaho Power), hereinafter sometimes referred to collectively as "Parties" or individually as "Part."
WITNESSETH:
WHREAS, Seller wil design, constrct, own, maintain and operate an electrc generation facilty; and
WHREAS, Seller wishes to sell, and Idaho Power is wiling to purchase, firm electric 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: DEFmlTIONS
As used in this Agreement and the appendices attched 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 ofthis Agreement less any Net Energy that is determined to be Surlus Energy as
specified within this Agreement.
1.2 "Commission" - The Idaho Public Utilties Commission.
1.3 "Contract Year" - The period commencing each calendar year on the same calendar date as the
Operation Date and ending 364 days thereafter.
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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.
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 current month's Mid-Columbia Market Energy Cost minus the current month's All
Hours Energy Price specified in paragraph 7.2 of this Agreement. If this calculation results in a value
less than 0, the result ofthis calculation wil be O.
1.7 "Designated Dispatch Facilty" - Idaho Power's Systems Operations Group, or any subsequent group
designated by Idaho Power.
1.8 "Environmental Attibutes" means any and all credits, benefits, emissions reductions, offsets, and
allowances, howsoever entitled, attibutable to the generation from the Facility, and its avoided emission
of pollutants. Environmental Attibutes include but are not limited to: (1) any avoided emission of
pollutants to the air, soil or water such as sulfur oxides (SOx), nitrogen oxides (NOx), carbon monoxide
(CO) and other pollutats; (2) any avoided emissions of carbon dioxide (C02), methane (CH4), nitrous
oxide, hydrofluorocarbons, perfluorocarbons, sulfur hexafluoride and other greenhouse gases (GHGs)
that have been determined by the United Nations Intergovernental Panel on Climate Change, or
otherwise by law, to contrbute to the actual or potential theat of altering the Ear's climate by
trapping heat in the atmosphere;! (3) the reporting rights to these avoided emissions, such as REC
Reporting Rights. REC Reporting Rights are the right of a REC Purchaser to report the ownership of
accumulated RECs in compliance with federal or state law, if applicable, and to a federal or state agency
or any other par at the REC Purchaser's discretion, and include without limitation those REC
Reporting Rights accruing under Section 1605(b) of The Energy Policy Act of 1992 and any present or
future federal, state, or local law, regulation or bil, and international or foreign emissions trading
program. RECs are accumulated on a MWh basis and one REC represents the Environmental Attributes
Avoided emissions mayor may not have any value for GHG compliance puroses. Although avoided emissions
are included in the list of Environmental Attbutes, this inclusion does not create any right to use those avoided emissions
to comply with any GHG regulatory program.
-2-
associated with one (1) MWh of Energy. Environmental Attibutes do not include (i) any energy,
capacity, reliabilty or other power attibutes from the Facilty, (ii) production tax credits associated with
the constrction or operation of the Facility and other financial incentives in the form of credits,
reductions, or allowances associated with the Facilty that are applicable to a state or federal income
taxation obligation, (iii) the cash grant in lieu of the investment tax credit pursuant to Section 1603 of
the American Recovery and Reinvestment Act of 2009, or (iv) emission reduction credits encumbered
or used by the Facilty for compliance with local, state, or federal operating and/or air quality permits.
1.9 "Facility" -_That electric generation facility described in Appendix B of this Agreement.
1.10 "First Energy Date" - The day commencing at 00:01 hours, Mountain Time, following the day that
Seller has satisfied the requirements of Article IV and the Seller begins delivering energy to the Idaho
Power electrcal system at the Point of Delivery.
1.11 "Heavy 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, Thanksgiving and Christmas.
1.12 "Heavy Load Peak Hours" - The daily Heavy Load Hours from hour beginning at 3:00 pm through hour
ending 7 pm Mountain time, ( 4 hours).
1.13 "Heavy Load Standard Hours" - The daily Heavy Load Hours not included as Heavy Load Peak Hours.
1.14 "Interconnection Facilties" - All equipment specified in Schedule 72.
1.15 "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 Years Day, Memorial Day, Independence Day, Labor
Day, Thansgiving and Christmas.
1.16 "Losses" - The loss of electrcal energy expressed in kilowatt hours (kWh) occurrng as a result of the
transformation and transmission of energy between the point where the Facilty'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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1.17 "Market Energy Reference Price" - Eighty-five percent (85%) of the Mid-Columbia Market Energy
Cost.
1.18 "Material Breach" - A Default (paragraph 19.2.1) subject to paragraph 19.2.2.
1.19 "Maximum Capacity Amount" - The maximum capacity (MW) of the Facilty wil be as specified in
Appendix B of this Agreement.
1.20 "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.
1.21 "Metering Point" - The physical point at which the Metering Equipment is located that enables
accurate measurement of the Test Energy and Net Energy deliveries to Idaho Power at the Point of
Delivery for this Facility that provides all necessary data to administer this Agreement.
1.22 "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. Ifthe 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.
1.23 "Nameplate Capacity" -The full-load electrical quantities assigned by the designer to a generator and its
prime mover or other piece of electrcal equipment, such as transformers and circuit breakers, under
standardized conditions, expressed in amperes, kilovolt-amperes, kilowatts, volts or other appropriate
units. Usually indicated on a nameplate attched to the individual machine or device.
1.24 "Net Energy" - All ofthe electric energy produced by the Facility, less Station Use, less Losses,
expressed in kilowatt hours (kWh) delivered to Idaho Power at the Point of Delivery. Subject to the
terms of this Agreement, Seller commits to deliver all Net Energy to Idaho Power at the Point of
Delivery for the full term of the Agreement.
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1.25 "Operation Date" - The day commencing at 00:01 hours, Mountain Time, following the day that all
requirements of paragraph 5.2 have been completed.
1.26 "Point of Delivery" - The location specified in Appendix B, where Idaho Power's and the Seller's
electrcal facilities are interconnected and the energy from this Facility is delivered to the Idaho Power
electrical system.
1.27 "Prudent Electrical Practices" - Those practices, methods and equipment that are commonly and
ordinarily used in electrical engineering and operations to operate electric equipment lawfully, safely,
dependably, effciently and economically.
1.28 "Renewable Energy Certificate" or "REC" means a certificate, credit, allowance, green tag, or other
transferable indicia, howsoever entitled, indicating generation of renewable energy by the Facility, and
includes all Environmental Attbutes arising as a result of the generation of electricity associated with
the REC. One REC represents the Environmental Attibutes associated with the generation of one
thousand (1,000) kWh of Net Energy.
1.29 "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.
1.30 "Schedule 72" - Idaho Power's Tarff 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 electrcal system as specified within Schedule 72 and this Agreement.
1.31 "Season" - The three periods identified in paragraph 6.2.1 of this Agreement.
1.32 "Special Facilties" - Additions or alterations of transmission and/or distribution lines and transformers
as described in Schedule 72.
1.3 3 "Station Use" - Electric energy that is used to operate equipment that is auxiliar or otherwise related to
the production of electrcity by the Facility.
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1.34 "Surplus Energy" - defined as follows:
1.34.1 For the first Contract Year: 1) Net Energy produced by the Seller's Facility and delivered to the
Idaho Power electrical system during the month which exceeds 130% of the monthly Net
Energy Amount for the corresponding month specified in paragraph 6.2, or 2) All Net Energy
produced by the Seller's Facility and delivered to the Idaho Power electrcal system in any
month where the Net Energy delivered for that month is less than 70% of the monthly Net
Energy Amount for the corresponding month specified in paragraph 6.2, or 3) All Net Energy
produced by the Seller's Facility and delivered by the Facilty to the Idaho Power electrcal
system prior to the Operation Date.
1.34.2 For all Contract Years other then the first Contract Year: 1) Net Energy produced by the Seller's
Facility and delivered to the Idaho Power electrcal system during the month which exceeds
110% of the monthly Net Energy Amount for the corresponding month specified in paragraph
6.2, or 2) All Net Energy produced by the Seller's Facility and delivered to the Idaho Power
electrical system in any month where the Net Energy delivered for that month is less than 90%
of the monthly Net Energy Amount for the corresponding month specified in paragraph 6.2, or
3) All Net Energy produced by the Seller's Facility and delivered by the Facilty to the Idaho
Power electrcal system prior to the Operation Date.
1.35 "Total Cost of the Facility" - The total cost of strctures, equipment and appurenances.
ARTICLE II: NO RELIANCE ON IDAHO POWER
2.1 Seller Independent Investigation - Seller warants and represents to Idaho Power that in entering into
this Agreement and the underting by Seller of the obligations set forth herein, Seller has investigated
and determined 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,
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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: WARNTIES
3.1 No Waranty 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, regarding any aspect of Seller's design,
specifications, equipment or facilties, including, but not limited to, safety, durabilty, reliability,
strengt, capacity, adequacy or economic feasibilty.
3.2 Qualifying Facility Status - Seller warants that the Facilty is a "Qualifying Facilty," 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 Facilty's Qualifying Facilty status during the term ofthis Agreement and
Seller's failure to maintain Qualifying Facility status wil be a Material Breach ofthis Agreement.
Idaho Power reserves the right to review the Facilty's Qualifying Facilty status and associated support
and compliance documents at anytime during the term of this Agreement.
ARTICLE N: 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:
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. a~ a certified
Qualifying Facility.
4.1.2 Opinion of Counsel - Submit to Idaho Power an Opinion Letter signed by an attorney admitted
to practice and in good standing in the State of Idaho 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
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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 Nameplate Capacity - Submit to Idaho Power manufacturer's and engineering documentation
that establishes the Nameplate Capacity of each individual generation unit that is included
within this entire Facility and also the total of these components to determine the Facilty
Nameplate Capacity rating. Upon receipt of this data, Idaho Power shall review the provided
data and determine if the Nameplate Capacity specified is reasonable based upon the
manufactuer's specified generation ratings for the specific generation units.
4.1.4 Engineer's Certifications - Submit an executed Engineer's Certification of Design &
Constrction 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 necessar to recognize the different
engineering disciplines providing the certificates.
4.1.5 Insurance - Submit written proof to Idaho Power of all insurance required in Aricle XIII.
4.1.6 Interconnection - Provide written confirmation from Idaho Power's delivery business unit that
Seller has satisfied all interconnection requirements.
4.1.7 Network Resource Designation - The Seller's Facility has been designated as a network
resource capable of delivering firm energy up to the amount of the Maximum Capacity.
4.1.8 Written Acceptace - Request and obtain written confiration from Idaho 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.
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ARTICLE V: TERM AND 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 twenty five (25) 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 Idaho Power has been
received.
c) Seller has demonstrated to Idaho Power's satisfaction that the Facilty 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 unreasonably 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 constrction 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 ninety (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 ((Curent month's Initial Year Net Energy
Amount as specified in paragraph 6.2.1 divided by the number of days in the current
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 Ifthe 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 calculated as follows:
Fort five dollars ($45) multiplied by the Maximum Capacity with the Maximum
Capacity being measured in kW, less the actual Delay Liquidated Damages paid
pursuant to paragraph 5.3.1 above.
5.4 If Seller fails to achieve the Operation Date within one-hundred and twenty (120) 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 seven
(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 Idaho 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 certinty, 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:
a) Filed for interconnection and is in compliance with all payments and requirements
of the interconnection process
b) Received and accepted an interconnection feasibility study for this Facility.
c) Provided all information required to enable Idaho Power to fie an initial
transmission capacity request.
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d) Accepted the results of the initial transmission capacity request.
e) Acknowledged responsibilty 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. If final interconnection or
transmission studies are not complete at the time the Seller executes this
Agreement, the Seller understands that the Seller's obligations to pay Damages and
Liquidated Damages associated with the projects failure to achieve the Operation
Date by the Scheduled Operation Date as specified in this Agreement is not relieved
by final interconnection or transmission processes and schedules.
5.8 Within thirt (30) days of the date of a final non-appealable Commission Order as specified in Aricle
XXI approving this Agreement, the Seller shall post liquid security ("Delay Security") in a form as
described in Appendix D equal to or exceeding the amount calculated in paragraph 5.8.1. Failure to
post this Delay Security in the time specified above wil be a Material Breach of this Agreement and
Idaho Power may terminate this Agreement.
5.8.1 Delay Security - The greater of fort 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 paragraph 6.2.1 for those thee months multiplied by the All
Hours Energy Price specified in paragraph 7.2 for each of those three months.
5.8.1.1 In the event Seller provides Idaho Power with certification that, (1) a generation
interconnection agreement specifying 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 terms and
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conditions of the generation interconnection agreement, the Delay Security calculated
in accordance with paragraph 5.8.1 wil be reduced by ten percent (10%).
5.8.1.2 If the Seller has received a reduction in the calculated Delay Security 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 five (5) business days from the date
Idaho Power requests reinstatement. Failure to timely reinstate the Delay Security 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 at the earlier of, 1)
thir (30) days after the Operation Date has been achieved, or 2) sixty (60) days after the
Agreement has been terminated.
ARTICLE VI: PURCHASE AND SALE OF NET ENERGY
6.1 Delivery and Acceptace of Net Energy - Except when either Par's performance is excused as
provided herein, Idaho Power wil purchase and Seller wil sell all of the Net Energy to Idaho Power at
the Point of Delivery. Net Energy produced by the Facilty and delivered by the Seller at any moment in
time to the Point of Delivery that exceeds the Maximum Capacity Amount wil be a Material Breach of
this Agreement.
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
2,480,000
3,120,000
4,240,000
4,860,000
4,400,000
1,760,000
1,280,000
4,520,000
3,980,000
2,980,000
1,120,000
1,560,000
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
beginning 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 wrtten notice in
accordance with paragraph 25.1, no later than 5 :00 PM of the 5th day following the end of the
previous month or by electronic notice provided and verified via return electronic verification of
receipt to the electronic notices addressed specified in 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 recently
provided 3 matching 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 30 days prior to the first day of the second Contract Year, by written
notice given to Idaho Power in accordance with paragraph 25.1, the Seller may revise
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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 first day ofthe second Contract Year
and at the end of every third month thereafter: (1) the Seller may not revise the
immediate next three 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 not unreasonably rejected 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.) IfIdaho 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 curtilment 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 circumstaces
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 of this
agreement.
RSH Actual hours the Facility's Net Energy deliveries were either
reduced or suspended under paragraph 12.2.1 or 12.3.1
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TH Actual total hours in the current month
Resulting formula being:
Adjusted
Net Energy = NEA
Amount - ( (sou X NEA ) X ( RSHTGU 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 paragraph 6.2 shall constitute an event of default.
ARTICLE VII: PURCHASE PRICE AND METHOD OF PAYMENT
7.1 Base Energy Purchase Price
7.1.1 During the months of March, April and May Idaho Power shall pay the non-levelized Heavy
Load Energy Price for all Base Energy received during Heavy Load Hours and the Light Load
Energy Price for all Base Energy received during Light Load hours for each year as specified
below:
Year
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
Heavy Load Energy Price
MilslkWh
70.78
71.90
73.02
74.18
75.34
76.53
77.73
78.96
80.21
81.47
82.76
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Light Load Energy Price
MilslkWh
65.43
66.55
67.67
68.83
69.99
71.18
72.38
73.61
74.86
76.12
77.41
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
84.07
85.40
86.75
88.13
89.52
90.93
92.37
93.84
95.33
96.26
97.20
98.15
99.10
100.07
101.05
78.72
80.05
81.40
82.78
84.16
85.58
87.02
88.49
89.98
90.91
91.85
92.79
93.75
94.72
95.70
7.1.2 During the months of November and December, Idaho Power shall pay the non-levelized Heavy
Load Energy Price for all Base Energy received during Heavy Load Hours and the Light Load
Energy Price for all Base Energy received during Light Load hours for each year as specified
below:
Year
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
Heavy Load Energy Price
MilslkWh
115.56
117.38
119.22
121.10
123.01
124.94
126.91
128.92
130.96
133.02
135.12
137.26
139.43
141.64
143.88
146.15
148.46
150.82
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Light Load Energy Price
MilslkWh
106.82
108.65
110.48
112.37
114.28
116.21
118.1 8
120.18
122.22
124.28
126.38
128.52
130.69
132.90
135.14
137.41
139.73
142.08
2030
2031
2032
2033
2034
2035
2036
2037
153.22
155.64
157.16
158.69
160.24
161.80
163.38
164.98
144.48
146.90
148.42
149.95
151.50
153.07
154.64
156.24
7.1.3 During the months of July and August, Idaho Power shall pay the non-levelized Heavy Load
Standard Energy Price for all Base Energy received during Heavy Load Standard Hours, the
Heavy Load Peak Hour Prices for all Base Energy received during Heavy Load Peak Hours and
the Light Load Energy Price for all Base Energy received during Light Load Hours for each
year as specified below:
Heavy Load Stadard Heavy Load Peak
Energy Price Energy Price Light Load Energy Price
Year Mils/kWh Mils/kWh Mils/kWh
2012 113.25 121.34 106.82
2013 115.03 123.25 108.65
2014 116.84 125.18 110.48
2015 118.68 127.16 112.37
2016 120.55 129.16 114.28
2017 122.44 131.19 116.21
2018 124.37 133.26 118.18
2019 126.34 135.37 120.18
2020 128.34 137.51 122.22
2021 130.36 139.67 124.28
2022 132.42 141.88 126.38
2023 134.51 144.12 128.52
2024 136.64 146.40 130.69
2025 138.81 148.72 132.90
2026 141.00 151.07 135.14
2027 143.23 153.46 137.41
2028 145.49 155.88 139.73
2029 147.80 158.36 142.08
2030 150.16 160.88 144.48
2031 152.53 163.42 146.90
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2032 154.02 165.02 148.42
2033 155.52 166.62 149.95
2034 157.04 168.25 151.50
2035 158.56 169.89 153.07
2036 160.11 171.55 154.64
2037 161.68 173.23 156.24
7.1.4 During the months of June, September, October, January and February, Idaho Power shall
pay the non-levelized Heavy Load Energy Price for all Base Energy received durig Heavy
Load Hours and the Light Load Energy Price for all Base Energy received during Light
Load hours as specified below:
Year
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
Heavy Load Energy Price
Mils/kWh
96.30
97.82
99.35
100.92
102.51
104.12
105.76
107.43
109.13
110.85
112.60
114.38
116.19
118.03
119.90
121.79
123.72
125.68
127.68
129.70
130.96
132.24
133.53
134.83
136.15
137.48
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Light Load Energy Price
Mils/kWh
89.02
90.54
92.07
93.64
95.23
96.84
98.48
100.15
101.85
103.57
105.32
107.10
108.91
110.75
112.62
114.51
116.44
118.40
120.40
122.42
123.68
124.96
126.25
127.55
128.87
130.20
7.2 All Hours Energy Price - The price to be used in the calculation of the Surlus Energy Price and Delay
Damage Price shall be the non-levelized energy price for each year as specified below:
July, August,June, September,
March, April and November and October, Januar and
May December Februar
Year Mils/kWh Mils/kWh Mils/kWh
2012 68.40 111.67 93.06
2013 69.52 113.50 94.58
2014 70.64 115.33 96.11
2015 71.79 117.22 97.68
2016 72.96 119.12 99.27
2017 74.15 121.06 100.88
2018 75.35 123.02 102.52
2019 76.58 125.03 104.19
2020 77.83 127.07 105.89
2021 79.09 129.13 107.61
2022 80.38 131.23 109.36
2023 81.69 133.37 111.14
2024 83.02 135.54 112.95
2025 84.37 137.75 114.79
2026 85.75 139.99 116.66
2027 87.13 142.26 118.55
2028 88.55 144.58 120.48
2029 89.99 146.93 122.44
2030 91.46 149.33 124.44
2031 92.95 151.75 126.46
2032 93.88 153.27 127.72
2033 94.82 154.80 129.00
2034 95.76 156.35 130.29
2035 96.72 157.91 13 1.59
2036 97.69 159.49 132.91
2037 98.67 161.09 134.24
7.3 Surplus Energy Price - For all Surplus Energy, Idaho Power shall pay to the Seller the lower of the
curent month's Market Energy Reference Price, Light Load Energy Price or the All Hours Energy Price
specified in paragraph 7.2.
7.4 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
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documentation of the monthly Net Energy actually delivered to Idaho Power as specified in
Appendix A.
7.5 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 constred in accordance 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 Utilties 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 Utilty Regulatory Policies Act of 1978 and 18 CFR §292.303-308
ARTICLE VII: ENVIRONMNTAL ATTRIUTES
8.1 Environmental Attibutes. Idaho Power wil be granted ownership of 50% of all of the Environmental
Attibutes associated with the Facility and Seller wil likewise retain 50% ownership of all of the
Environmental Attibutes associated with the Facilty. Title of 50% Environmental Attibutes shall pass
to Idaho Power at the same time that transfer of title of the associated Test Energy or Net Energy to
Idaho Power occurs. If after the Effective Date any additional Environmental Attibutes or similar
environmental value is created by legislation, regulation, or any other action, including but not limited
to, carbon credits and carbon offsets, Idaho Power shall be granted ownership of 50% of these additional
Environmental Attibutes or environmental values that are associated with the Test Energy or the Net
Energy delivered by the Seller to Idaho Power. Seller shall use prudent and commercially reasonable
efforts to ensure that any operations of the Facilty do not jeopardize the current or future Environmental
Attribute status of this solar generation Facilty.
8.2 The Paries shall cooperate to ensure that all Environmental Attbute certifications, rights and reporting
requirements are completed by the responsible Paries.
8.2.1 At least sixty (60) days prior to the First Energy Date, the Paries shall mutually cooperate to
enable Idaho Power's Environmental Attributes from this Facility to be placed into Idaho
Power's WRGIS account or any other Environment Attibute accounting and tracking system
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selected by the Idaho Power. The Seller at the Seller's sole expense wil be responsible to
establish and maintain the Seller's WRGIS or other Environmental Attbute account and/or
system that enables the creation of the Environmental Attibute certificates associated with this
Project and the transfer of 50% of the Environmental Attbutes to Idaho Power for the Term of
this Agreement. If the Environmental Attribute accounting and tracking system initially
selected by Idaho Power is materially altered or discontinued during the Term of this
Agreement, the Parties shall cooperate to identify an appropriate alternative Environmental
Attribute accounting and tracking process and enable the Environmental Attibutes be processed
through this alternative method.
8.2.2 Each Par shall only report under Section 1605(b) ofthe Energy Policy Act of 1992 or under
any applicable program the 50% of the Environmental Attbutes that such part owns and shall
refrain from reporting the Environmental Attibutes owned by the other Par.
8.2.3 If Idaho Power requests additional Environmental Attibute certifications beyond what is
provided by the WRGIS process the Seller shall obtain any Environmental Attibute
certifications required by Idaho Power for those Environmental Attibutes delivered to Idaho
Power from the Seller. If the Seller incurs cost, as a result ofIdaho Power's request, Seller shall
invoice Idaho Power for the reasonable costs, not to exceed 50% of the total cost of providing
such certification. If Idaho Power elects to obtain its own certifications, then Seller shall fully
cooperate with Idaho Power in obtaining such certification.
ARTICLE IX: FACILITY AND mTERCONNCTION
9.1 Design of Facility - Seller wil design, constrct, 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 to the Idaho Power Point of Delivery for the full term of the Agreement.
9.2 Interconnection Facilities - Except as specifically provided for in this Agreement, the required
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Interconnection Facilities wil be in accordance with Schedule 72, the Generation Interconnection
Process and Appendix B. The Seller is responsible for all costs associated with this equipment as
specified in Schedule 72 and the Generation Interconnection Process, including but not limited to initial
costs incured by Idaho Power for equipment costs, installation costs and ongoing monthly Idaho Power
operations and maintenance expenses.
ARTICLE X: METERIG AND TELEMETRY
10.1 Metering - Idaho Power shall, for the account of Seller, provide, install, and maintain Metering
Equipment to be located at a mutually agreed upon location to record and measure power flows to Idaho
Power in accordance with this Agreement and Schedule 72. The Metering Equipment wil be at the
location and the tye required to measure, record and report the Facilty's Net Energy, Station Use, and
maximum energy deliveries (kW) at the Point of Delivery in a maner 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 Telemetr - Idaho Power wil install, operate and maintaÎn at Seller's expense communications and
telemetr equipment which wil be capable of providing Idaho Power with continuous instantaneous
telemetr of Seller's Net Energy produced and delivered to the Idaho Power Point of Delivery to Idaho
Power's Designated Dispatch Facility.
ARTICLE XI - RECORDS
11.1 Maintenance of Records - Seller shall maintain at the Facilty or such other location mutually acceptable
to the Paries adequate total generation, Net Energy, Station Use, and maximum generation (kW)
records in a form and content acceptable to Idaho Power.
11.2 Inspection - Either Par, after reasonable notice to the other Par, shall have the right, during normal
business hours, to inspect and audit any or all generation, Net Energy, Station Use, and maximum
generation (kW) records pertaining to the Seller's Facility.
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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 Acceptace -
12.2.1 Idaho Power shall be excused from accepting and paying for Net 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 accordance with Schedule 72. If, for reasons other than an event of Force Majeure, a
temporary disconnection under Schedule 72 exceeds twenty (20) days, beginning with the
twenty-first day of such interrption, curilment or reduction, Seller wil be deemed to be
delivering 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,
curtilment or reduction is terminated.
12.2.2 If, in the reasonable opinion ofIdaho Power, Seller's operation of the Facilty or Interconnection
Facilties 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/distribution 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 from the Facility to the Point of
Delivery in an amount that exceeds the Maximum Capacity Amount at any moment in time.
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 Facilty and is not excused from
accepting the Facilty's energy, Idaho Power's damages shall be limited to only the contract
value of the estimated energy that Idaho Power was unable to accept. Idaho Power wil have no
responsibilty to pay for any other costs, lost revenue or consequential damages the Facilty may
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incur.
12.3 Seller Declared Suspension of Energy Deliveries
12.3.1 If the Seller's Facilty 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 Facilty, Seller may, after giving notice as provided in paragraph
12.3.2 below, temporarily suspend all deliveries of Net Energy to Idaho Power from the Facilty
or from individual generation unit(s) 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
sta 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 hours) in the written
notification provided by the Seller. in the month(s) in which the Declared Suspension of Energy
occurred, 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 making telephone contact with Idaho Power. The Seller wil, within 24 hours
after the telephone contact, provide Idaho Power a written notice in accordance with Aricle
XXV that wil contain the beginning 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 qualifying 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
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Seller's Facility.
12.4 Scheduled Maintenance - On or before Januar 31st of each calendar year, Seller shall submit a written
proposed maintenance schedule of significant Facilty maintenance for that calendar year and Idaho
Power and Seller shall mutually agree as to the acceptability of the proposed schedule. The Paries
determination as to the acceptabilty 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 Part shall unreasonably withhold acceptance ofthe proposed maintenance schedule.
12.5 Maintenance Coordination - The Seller and Idaho Power shall, to the extent practical, coordinate their
respective line and Facilty maintenance schedules such that they occur simultaeously.
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 Facility. Seller
understands that in the case of emergency circumstances, real time operations of the electrical system,
and/or unplanned events, Idaho Power may not be able to provide notice to the Seller prior to
interrption, curtilment, or reduction of electrical energy deliveries to Idaho Power.
ARTICLE XII: INEMNIFICATION AND mSURNCE
13.1 Indemnification - Each Par shall agree to hold harless and to indemnify the other Par, its officers,
agents, affiliates, subsidiaries, parent company and employees against all loss, damage, expense and
liabilty to third persons for injury to or death of person or injury to propert, proximately caused by the
indemnifying Par's (a) constrction, ownership, operation or maintenance of, or by failure of, any of
such Par's works or facilties used in connection with this Agreement, or (b) negligent or intentional
acts, errors or omissions. The indemnifying Par shall, on the other Par's request, defend any suit
asserting a claim covered by this indemnity. The indemnifying Part shall pay all documented costs,
including reasonable attorney fees that may be incurred by the other Par in enforcing this indemnity.
13.2 Insurance - During the term of this Agreement, Seller shall secure and continuously car the following
insurance coverage:
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13.2.1 Comprehensive General Liabilty Insurance for both bodily injury and propert damage with
limits equal to $1,000,000, each occurrence, combined single limit. The deductible for such
insurance shall be consistent with current Insurance Industr Utility practices for similar
propert.
13.2.2 The above insurance coverage shall be placed with an insurance company with an A.M. Best
Company rating of A- or better and shall include:
(a) An endorsement naming Idaho Power as an additional insured and loss payee as
applicable; and
(b) A provision stating that such policy shall not be canceled or the limits of liability
reduced without ten (l0) days' prior written notice to Idaho Power.
13.3 Seller to Provide Certificate of Insurance - As required in paragraph 4.1.6 herein and annually
thereafter, Seller shall furnish Idaho Power a certificate of insurance, together with the endorsements
required therein, evidencing the coverage as set forth above.
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 taking 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 MAUR
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 Par is
unable to prevent or overcome. Force Majeure includes, but is not limited to, acts of God, fire, flood,
storms, wars, hostilties, civil strife, strikes and other labor disturbances, earthquakes, fires, lightning,
epidemics, sabotage, or changes in law or regulation occurring after the Effective Date, which, by the
exercise of reasonable foresight such par could not reasonably have been expected to avoid and by the
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exercise of due diligence, it shall be unable to overcome. If either Par 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:
(l) The non-performing Par shall, as soon as is reasonably possible afer the occurrence
of the Force Majeure, give the other Part written notice describing the pariculars of
the occurence.
(2) The suspension of performance shall be of no greater scope and of no longer duration
than is required by the event of Force Majeure.
(3) No obligations of either Par which arose before the occurrence causing the suspension
of performance and which could and should have been fully performed before such
occurrence shall be excused as a result of such occurence.
ARTICLE XV: LIAILITY; DEDICATION
15.1 Limitation of Liabilty. Nothing in this Agreement shall be construed to create any duty to, any
standard of care with reference to, or any liability to any person not a Par to this Agreement. Neither
part shall be liable to the other for any indirect, special, consequential, nor punitive damages, except as
expressly authorized by this Agreement.
15.2 Dedication. No undertking by one Par to the other under any provision of this Agreement shall
constitute the dedication of that Part's system or any portion thereof to the Par or the public or affect
the status of Idaho Power as an independent public utilty 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
ofthe Paries are intended to be several and not joint or collective. Nothing contained in this Agreement
shall ever be constred to create an association, trst, partership or joint venture or impose a trst or
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partership duty, obligation or liabilty on or with regard to either Part. Each Par shall be
individually and severally liable for its own obligations under this Agreement.
ARTICLE XVII: WAIVER
17.1 Any waiver at any time by either Par 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.
ARTICLE XVII: CHOICE OF LAWS AND VENU
18.1 This Agreement shall be constred and interpreted in accordance 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
Fourt Judicial Distrct ofIdaho in and for the County of Ada.
ARTICLE XIX: DISPUTES AND DEFAULT
19. i 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 Par fails to perform any of the terms or conditions of this Agreement
(an "event of default"), the non defaulting Part shall cause notice in writing to be given to
the defaulting Part, specifYing the manner in which such default occured. If the defaulting
Part shall fail to cure such default within the sixty (60) days after service of such notice, or
if the defaulting Part reasonably demonstrates to the other Par that the default can be
cured within a commercially reasonable time but not within such sixty (60) day period and
then fails to dilgently pursue such cure, then, the non defaulting Part may, at its option,
terminate this Agreement and/or pursue its legal or equitable remedies.
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19.2.2 Material Breaches - The notice and cure provisions in paragraph 19.2. i do not apply to
defaults identified in this Agreement as Material Breaches. Material Breaches must be cured
as expeditiously as possible following occurrence ofthe breach.
19.3 Security for Performance - Prior to the Operation Date and thereafter for the full term of this
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.
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 Idaho, 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.
19.3.3 Licenses and Permits - During the full term 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 permits 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: GOVERNNTAL AUTHORIATION
20.1 This Agreement is subject to the jurisdiction of those governmental agencies having control over either
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Part 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 AND 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 Paries hereto, except that no assignent hereof by either
Part shall become effective without the written consent of both Paries being first obtained. Such
consent shall not be unreasonably withheld. Notwithstanding the foregoing, any par which Idaho
Power may consolidate, or into which it may merge, or to which it may conveyor transfer substantially
all of its electric utility 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 XXN: TAXES
24.1 Each Par shall pay before delinquency all taes and other governental charges which, if failed to be
paid when due, could result in a lien upon the Facility or the Interconnection Facilities.
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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:
To Seller:
Original document to:
Interconnect Solar Development LLC
3777 Twilght Drive
Boise, ID 83703
Telephone:
Cell:
FAX:
208-440-0358
208-440-0358
E-mail: randyhemmer~clearwire.net
Copy of document to:
Bil Piske
1303 E. Carer
Boise, ID 83706
Telephone:
Email:
208-941-7458
bilpiske~cableone.net
To Idaho Power:
Original document to:
Senior Vice President, Power Supply
Idaho Power Company
PO Box 70
Boise, Idaho 83707
Email: Lgrow(ßidahopower.com
Copy of document to:
Cogeneration and Small Power Production
Idaho Power Company
POBox 70
Boise, Idaho 83707
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E-mail: rallphincmidahopower.com
Either Par may change the contact person and/or address information listed above, by providing written notice
from an authorized person representing the Par.
ARTICLE XXVI: ADDITIONAL TERMS AND CONDITIONS
26.1 This Agreement includes the following appendices, which are attched hereto and included by
reference:
Appendix A
AppendixB
AppendixC
AppendixD
Generation Scheduling and Reporting
Facility and Point of Delivery
Engineer's Certifications
Forms of Liquid Security
ARTICLE XXVII: SEVERABILITY
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 constred in all
otherrespects as if the invalid or unenforceable term or provision were omitted.
ARTICLE XXVII: COUNTERPARTS
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 instrment.
ARTICLE XXIX: ENTIR AGREEMENT
29.1 This Agreement constitutes the entire Agreement of the Parties concerning the subject matter hereof and
supersedes all prior or contemporaneous oral or written agreements between the Parties concerning the
subject matter hereof.
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m WITNESS WHREOF, The Paries hereto have caused this Agreement to be executed in
their respective names on the dates set forth below:
Idaho Power Company
By
&i/L G fu0Lisa A Grow
Sr. Vice President, Power Supply
Dated
i¡.r-. 1\
"Idaho Power"
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Interconnect Solar Development LLC
By ßt
Randy Hemmer
Manager
Dated O~/11/JJ~ J
"Seller"
APPENDIX A
A -1 MONTHLY POWER PRODUCTION AND SWITCHmG REPORT
At the end of each month the following required documentation wil be submitted to:
Idaho Power Company
Att: 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 measurg
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 Idaho Power to begin the
energy payment calculation and payment process. The meter readings on this report shall not be used to
calculate the actual payment, but instead wil be a check of the automated meter reading information that wil be
gathered as described in item A-2 below:
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Idaho Power Company
Cogeneration and Small Power Production
MONTHLY POWER PRODUCTION AN SWITCHING REPORT
Project Name
Month Year
Project Number:
Address
City
Meter Number:
End of Month kWh Meter Reading:
Beginning 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 Zip
Facilty
Output
Station
Usage
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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*Reason
¡
Date
A-2 AUTOMATED METER READmG COLLECTION PROCESS
Monthly, Idaho Power wil use the provided Metering and Telemetr equipment and processes to collect the
meter reading information from the Idaho Power provided Metering Equipment that measures the Net Energy
and energy delivered to supply Station Use for the Facility recorded at 12:00 AM (Midnight) ofthe 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 ROUTmE REPORTmG
Once the Facility has achieved its Operation Date and has operated in a reliable and consistent maner
for a reasonable period of time, the Paries may mutually agree to modify this Routine Reporting
requirement.
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
. Current Meter Reading
· Estimated Generation for the curent day
· Estimated Generation for the next day
Planed and Unplaned Project outages
Call 1-800-345-1319 and leave the following information:
· Project Identification - Project Name and Project Number
. Approximate time outage occurred
· Estimated day and time of project coming back online
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Seller's Contact Information
24-Hour Project Operational Contact
Name:
Telephone Number:
Cell Phone:
Thadeus Carson
208-338-7070
Project On-site Contact information
Name:
Telephone Number:
Thadeus Carson
208-338-7070
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APPENDIXB
FACILITY AND POmT OF DELIVERY
Project Name: Murhy Flats Solar Power Project
Project Number: 12616650
B-1 DESCRITION OF FACILITY
A Solar facility making use of 125 acres, consisting of 74,075 individual 270 Watt individual photo
voltaic panels for a total nameplate rating of the PV panels being 20.00025 MW and 10- 2 MW Siemens
Inverters.
Var Capability (Both leading and lagging: Leading is .95 Lagging is .95
B-2 LOCATION OF FACILITY
Near: Murhy, Idaho
Sections: 25,26,35 & 36 Township: 2S Range: 2E County: Owhee
Description of Interconnection Location: Antelope Lane
Nearest Idaho Power Substation: Sinker Creek
B-3 SCHEDULED FIRST ENERGY AND OPERATION DATE
Seller has selected June 1, 2012 as the Scheduled First Energy Date.
Seller has selected July 1, 2012 as the Scheduled Operation Date.
In making these selections, Seller recognizes that adequate testing of the Facilty and completion of all
requirements in paragraph 5.2 of this Agreement must be completed prior to the project being granted
an Operation Date.
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B-4 MAXIMM CAPACITY AMOUNT
This value wil be 20 MW which is consistent with the value provided by the Seller to Idaho Power in
accordance with Schedule 72. This value is the maximum energy (MW) that potentially could be
delivered by the Seller's Facilty to the Idaho Power electrical system at any moment in time.
B-5 POmT 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 Idaho 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 Metering equipment is capable of measuring 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 Metering Equipment is unable to measure the exact energy deliveries by
the Seller to the Idaho Power electrical system at the Point of Delivery, a Losses calculation wil be
established to measure the energy losses (kWh) between the Seller's Facilty and the Idaho Power Point
of Delivery. This loss calculation wil be initially set at 2% of the kWh energy production recorded on
the Facilty 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
electrical equipment between the Facility and the Idaho Power electrical system, Idaho Power wil
configue a revised Losses calculation formula to be agreed to by both paries and used to calculate the
kWh losses for the remaining 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
attibuted to the electrcal equipment between the Facilty and the Idaho Power electrical system, Idaho
Power may adjust the calculation and retroactively adjust the previous months kWh losses calculations.
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B-7 METERIG AND TELEMETRY
Schedule 72 wil determine the specific metering and telemetr requirements for this Facility. At the
minimum the Metering Equipment and Telemetr equipment must be able to provide and record hourly
energy deliveries to the Point of Delivery and any other energy measurements required to administer
this Agreement. These specifications wil include but not be limited to equipment specifications,
equipment location, Idaho Power provided equipment, Seller provided equipment, and all costs
associated with the equipment, design and installation of the 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
facilties 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 Idaho 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 ("NRD") 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
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cost to attain the NR 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 & MAmTENANCE POLICY
The undersigned , on behalf of himself /herself
, hereinafter collectively referred to as "Engineer," hereby states and certifies to the Seller asand
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 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 Idaho Power Company (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 recognizes 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, constrction and operation of electric power
plants of the same tye as this Project.
7. That Engineer has no economic relationship to the Design Engineer of this Project.
8. That Engineer has reviewed and/or supervised 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
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built to appropriate stadards, adherence to said O&M Policy wil result in the Project's producing at or near the
design electrical output, effciency and plant factor for a year period.
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, tre and accurate to the best of his /her
knowledge and therefore sets his/her hand and seal below.
By
(P .E. Stap)
Date
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APPENDIXC
ENGINER'S CERTIFICATION
OF
ONGOmG OPERATIONS AND MAmTENANCE
The undersigned , on behalf of himself/erself 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 of Idaho.
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 Idaho Power Company (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 year period.
6. That Engineer has substatial experience in the design, constrction and operation of electrc power
plants of the same tye 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 substatially 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, efficiency and plant factor for the remaining
years 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, tre and accurate to the best of his /her
knowledge and therefore sets hislher hand and seal below.
By
(P .E. Stap)
Date
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APPENDIXC
ENGINER'S CERTIFICATION
OF
DESIGN & CONSTRUCTION ADEQUACY
The undersigned , on behalf of himself/erself and
hereinafter collectively referred to as "Engineer", hereby states and certifies to
Idaho Power as follows:
1. That Engineer is a Licensed Professional Engineer in good standing in the State of Idaho.
2. That Engineer has reviewed the Firm Energy Sales Agreement, hereinafter "Agreement", between Idaho
Power as Buyer, and as Seller, dated !J
3. That the cogeneration or small power production project, which is the subject of the Agreement and this
Statement, is identified as Idaho Power Company (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 recognizes that the Agreement provides for the Project to fuish electrical energy to
Idaho Power for a year period.
6. That Engineer has substantial experience in the design, constrction and operation of electric power
plants of the same type as this Project.
7. That Engineer has no economic relationship to the Design Engineer of this Project and has made the
analysis ofthe plans and specifications independently.
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8. That Engineer has reviewed the engineering design and constrction of the Project, including the civil
work, electrical work, generating equipment, prime mover conveyance system, Seller furnished Interconnection
Facilities and other Project facilities and equipment.
9. That the Project has been constrcted 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 constrction ofthe Project is such that with reasonable and prudent operation and
maintenance practices by Seller, the Project is capable of performing in accordance with the terms of the
Agreement and with Prudent Electrical Practices for a year period.
11. That Engineer recognizes that Idaho Power, in accordance with paragraph 5.2 ofthe 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 /her
knowledge and therefore sets his/her hand and seal below.
By
(P .E. Stap)
Date
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APPENDIXD
FORMS OF LIQUID SECURTY
The Seller shall provide Idaho Power with commercially reasonable security instrments such as Cash
Escrow Security, Guarantee or Letter of Credit as those terms are defmed below or other forms of liquid
financial security that would provide readily available cash to Idaho Power to satisfy the Delay Security
requirement and any other security requirement within this Agreement.
For the purpose ofthis Appendix D, the term "Credit Requirements" shall mean acceptable financial
creditworthiness of the entity providing the security instrment in relation to the term ofthe obligation
in the reasonable judgment ofIdaho 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 Stadard & Poor's
Corporation or Moody's Investor Services, Inc. shall be deemed to have acceptable financial
creditworthiness.
1. Cash Escrow Security - Seller shall deposit funds in an escrow account established by the Seller in
a baning institution acceptable to both Paries equal to the Delay Security or any other required
security amount(s). The Seller shall be responsible for all costs, and receive any interest eared
associated with establishing and maintaining the escrow account(s).
2. Guarantee or Letter of Credit Security - Seller shall post and maintain in an amount equal to the
Delay Security or any other required security amounts: a) a guaranty from a part that satisfies the
Credit Requirements, in a form acceptable to Idaho Power at its discretion, or b) an irrevocable
Letter of Credit in a form acceptable to Idaho Power, in favor ofIdaho Power. The Letter of Credit
-48-
wil be issued by a financial institution acceptable to both paries. The Seller shall be responsible for
all costs associated with establishing and maintaining the Guarantee(s) or Letter(s) of Credit.
-49-
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
CASE NO. IPC-E-11-10
IDAHO POWER COMPANY
ATTACHMENT NO.2
DONOVAN E. WALKER
Lead Counsel
dwalkeraiidahopower.com
*5
IDA~PO~
An IOACORP company
June 7,2011
VIA ELECTRONIC MAIL & U.S. MAIL
Ronald L. Wiliams
WILLIAMS BRADBURY, P.C.
1015 West Hays Street
Boise, Idaho 83702
Re: Interconnect Solar Development, LLC
Ron:
Thank you for your letter of May 31, 2011, to Mr. Allphin and the accompanying
Firm Energy Sales Agreements ("FESA") signed by your client, Interconnect Solar
Development, LLC ("Interconnect Solar"). This letter is in response to your above-
referenced letter, as well as a memorial of our several phone conversations over the
past week.
Your letter expressed a great deal of urgency in requesting Idaho Power
Company ("Idaho Power" or "Company") to finish its required reviews of the final
execution copy of the FESA and to file the FESA with the Idaho Public Utilties
Commission ("Commission") prior to the Commission issuing its order in Case No.
GNR-E-11-01. Your letter also states that your understanding of Mr. Allphin's previous
communication was that should the Commission issue an order in Case No. GNR-E-11-
01 reinstating a ten average megawatt standard rate eligibilty cap for solar projects,
that the Company would not execute the FESA with Interconnect Solar that is based
upon the Integrated Resource Plan ("IRP") pricing modeL. As clarified in our phone
conversation, although the Company cannot guarantee that no matter what the
Commission's pending order may say that the Company would sign the FESA, if the
order comes out and simply reinstates the ten average megawatt published rate
eligibility cap for solar projects that the Company would sign Interconnect Solar's FESA
based upon the IRP pricing methodology and submit the same for the Commission's
approval or rejection. Consequently, the inference that Idaho Power was somehow
creating the urgency by which you and your clients needed to sign the contract based
upon Mr. Allphin's statements in unfounded.
1221 W. Idaho St. (83702)
P.O. Box 70
Boise. 10 83707
Ronald L. Willams
June 7,2011
Page 2 of 3
We have had several discussions and communications with regard to the
project's selection of the Scheduled Operation Date in the FESA in relation to the time
that Idaho Power Delivery requires to design, permit, and construct the required
interconnection/transmission facilties for this project. This was the subject of my April
12, 2011, e-mail to you. For your convenience, i have attached that e-mail to this
correspondence so that I do not have to repeat those details here.
As we discussed, the FESA that your client has signed and submitted to Idaho
Power, and that you have requested that Idaho Power execute and file with the
Commission, contains your client's selection of a Scheduled First Energy Date of June
1, 2012, and a Scheduled Operation Date of July 1, 2012. Additionally, your client wil
be required by the terms of the FESA to post Delay Security in the amount of $45 per
kilowatt of nameplate capacity to secure Delay Liquidated Damages that will be incurred
should the project not come on-line by the Scheduled Operation Date of July 1, 2012,
that it has selected. You and your client have been informed that Idaho Power's current
best estimation of its construction completion for the facilities is 18 months from the time
in which the project pays the required fees set forth in the Generator Interconnection
Agreement ("GIA") which have to this date not yet been paid. To be clear, Idaho Power
is not legally obligated to complete the interconnection/transmission related work by
your selected July 1, 2012, Scheduled Operation Date. Idaho Power is obligated to
abide by the GIA for the construction and completion of those facilities. Additionally,
should your project be unable to come on-line by July 1, 2012, even if the only reason
that it cannot do so is the fact that the interconnection/transmission facilities are not
completed at that time, that this wil not excuse your required performance under the
FESA, nor the forfeiture of the Delay Security that you wil be required to post.
Idaho Power has advised that your selection of a Scheduled Operation Date prior
to such time that the interconnection/transmission facilties are scheduled to be
completed puts your Delay Security at substantial risk of forfeiture, and could result in
your contract being terminated subsequent to such forfeiture. By insisting we move
forward with execution and filing of the FESA containing your selected July 1, 2012,
Scheduled Operation Date, you hereby accept and assume any and all risk associated
with the contingency that the interconnection/transmission facilities wil not be
constructed by your selected Scheduled Operation Date.
Being so advised, it is your desire that Idaho Power execute the FESA draft that
you signed and delivered to Idaho Power with your May 31, 2011, letter referenced
above. You hereby confirm and acknowledge that you wish to move forward with the
FESA, including the Idaho Public Utilties Commission approved $45 per kilowatt of
project capacity delay security, knowing that your selected Scheduled Operation Date ismuch sooner than Idaho Power is obligated to construct the
interconnection/transmission facilities. In addition, your client has been advised, and
accepts the risk, that delays in the interconnection/transmission process do not
constitute excusable delays in achieving the Scheduled Operation Date, and if the
Ronald L. Wiliams
June 7, 2011
Page 30f3
project fails to achieve the Scheduled Operation Date at the time specified in the FESA,
delay damages wil be assessed and delay security applied.
Please acknowledge your receipt, acceptance, and agreement by signing a copy
of this letter in the space indicated below and retuning the same to me. Upon receipt of
your acknowledgment, the executed FESA wil be filed with the Commission for its
review.
trAtL
Donovan E. Walker
DEW:csb
cc: Randy Allphin (via e-mail)
Lisa Loomis (via e-mail)
Agreed to and Accepted on behalf of Interconnect Solar Development, LLC:
Bil Piske/Randy Hemmer
On behalf of and for Interconnect
Solar Development, LLC
Ronald L. Wiliams
Legal Counsel for Interconnect Solar
Development, LLC
Walker, Donovan
From:
Sent:
To:
Cc:
Subjec:
Attachments:
Walker, Donovan
Tuesday, April 12, 2011 11 :45 AM
Ron Williams
Allphin, Randy; Loomis, Lisa; Bishop, Rowena
Murphy Solar Scheduled Operation Date
Murphy Solar Draf GIA (00057481 ).DOC; FW: E&P Agreement Murphy Flats
Ron,
I left you a voice message today, and your legal assistant said that you are out of the office until Friday so I thought I
would also send you this e-maiL. I am reviewing the final execution draft of the Murphy Solar PURPA contract, and
wanted to call your attention to the projects selected First Energy Date of February 10, 2012, and the project's selected
Scheduled Operation Date of April 1, 2012.
My understanding from Lisa Loomis, the project manager for the interconnection of this project, is that Idaho Power
Delivery wil require at least 18 months from the time that funds are paid by the project pursuant to the final Facilty
Study Report that the project has accepted, as well as the draft GIA, that stil needs to be finalized, in order to permit
and construct the required interconnection facilties for this project. The First Energy, and more importantly the
Scheduled Operation Date selected by the project is much sooner than those facilties can be constructed. Even if the
required fees were paid today, the April 1, 2012, date is less than one year away, and not likely to be met with Deliverys
projected construction time line. As we have discussed, the project is required to post delay security that wil be subject
to forfeiture if the Scheduled Operation date is not met.
A couple of other things to keep in mind: Because the interconnection work requires BLM permitting, environmental
surveys must be conducted where the route(s) cross/impact BLM lands. These environmental surveys can only be done
during the Spring survey season, which is upon us now. If the required surveys are not completed during this Spring's
survey season, then they wil not be able to be completed until the next Spring survey season, in the Spring of 2012,
essentially adding an additional year to the 18 month timeline required for the construction of the interconnection
facilties. Lisa Loomis forwarded an Engineering and Procurement Agreement to Mr. Piske on April 6 for this Spring
Survey work, which requires execution by the project and initial payment of the estimated cost of $50,000 by April 25,
2011, in order to be included in this year's Spring survey season. Like I said, if this is missed, it wil result in an additional
one-year before the required survey work for the required BLM permits can even begin.
For your convenience, I have attached to this e-mail both the E&P Agreement for the spring survey work, as well as the
draft GIA which sets forth the required time line. To be clear: (1) the E&P Agreement must be in place, with payment, by
April 25, 2011, in order to meet this year's spring environmental survey season; (2) the GIA must be executed and in
place, and the 18 month estimated construction time starts from the time that payment is made pursuant to the GIA.
The GIA requires payment of the $1,245,000 cost estimate up front in order for the required work - and timeline - to
start.
Please contact me at your earliest convenience to discuss the project's selection of its First Energy and Scheduled
Operation Date in the PURPA contract. As always, you may contact me with any other questions, comments, or
concerns as welL.
Regards,
Donovan E. Walker
Lead Counsel
Idaho Power Company
208-388-5317
1
Ronald L. Williams
June 7.2011
Page 30f3
prøje fails to achieve the SChuled Operaon Date at the time speifedln theFESA,
delay damages will be aSSssed and delay seurity applied.
Please acknwledge your receipt, accptnce, and agrement by signing a co~y
of this leter in the space Indicated below and retuning the same to me. Upon reipt of
your acknowedgment, the execued FESA will be filed with the Commission for its
review.
raIY,~tWtL
Donovan E. Walker
DEW:csb
cc: Randy Allphin (via e-mail)
Lisa Loomls.(Yla e-mail)
Agreed to and Accepted on behalf of Intercnnect Solar Development, LLC:
ß~ ~~/ lvlAll ",A~Bil Pfel ~ )l1"emmer
On behalf of and for Intercnnect
Solar Development, LLC
.
RIi LtJ~
Ronald L. Willams
Legal Counsel for Intrcnnec Solar
Development, LLC