20130730press release.pdf

Idaho Public Utilities Commission
Case No. IPC-E-11-15, Order No. 32861
July 30, 2013
Contact: Gene Fadness [phone], 890-2712
Website: www.puc.idaho.gov

PUC denies developer’s motions in solar power case

The Idaho Public Utilities Commission is giving the developer of a proposed
solar project near Grand View another week to show his project was willing
and able to obligate itself to supply power to Idaho Power Company in 2011.

The federal Public Utility Regulatory Policies Act, or PURPA, requires utilities
to buy energy from qualifying small renewable power projects at rates to be
determined by state commissions.

The developer of the Grand View PV Solar Two project in Elmore County
claims his project was ready to provide energy to Idaho Power, but the
parties did not sign a sales agreement because they could not agree on who
should receive the financial benefits of the Renewable Energy Credits (RECs)
associated with the project. RECs are tradable environmental commodities,
which represent proof that 1 megawatt-hour of electricity is generated from
an eligible renewable energy resource. (In a separate case, the commission
determined that revenue from REC sales be split 50-50 between the utility
and the renewable energy provider for wind and solar projects that are 100
kilowatts or larger unless the parties mutually agree to treat REC sales
differently.)

Grand View maintains that the dispute as to who should keep the revenue
from the RECs is separate from whether Idaho Power is obligated under
PURPA to buy output from the solar plant. The commission denied Grand
View’s motion for a declaratory order, stating that the manager of the project
admitted that RECs are an integral part of the project’s financial viability and
that without the revenue from the RECs, the project was not ready to sell
energy to Idaho Power.

In an affidavit filed with the commission, Grand View manager Robert Paul
said the project’s business plan is based upon selling all the RECs associated
with the project and that without the ability to sell the RECs, the “project’s
financial viability will be compromised.” He also said the project’s profitability
and his ability to raise the capital necessary to build the project would also
be compromised.

“We find these statements undermine Grand View’s argument that it was
willing and able to mutually obligate itself to supply power,” the commission
said. However, the commission said that if Grand View can provide evidence
that it created a legally enforceable obligation without conditions (such as
retaining all REC benefits), “then it may present such evidence to the
commission within seven days,” of the order’s July 29 date.

The commission denied another request by Grand View Solar Two that the
December 2012 commission decision to split RECs evenly between utilities
and solar and wind projects not be applied to this case because the proposed
sales agreement was offered in 2011.

However, the commission noted that REC ownership was the primary issue in
an original complaint filed by Grand View Solar Two against Idaho Power. “It
now suggests that we simply ignore the REC dispute – the very heart of
Grand View’s complaint, amended complaint and Motion for Summary
Judgment,” the commission said. “Grand View’s argument to simply separate
the REC dispute from the legally enforceable obligation issue is inconsistent
with the facts and positions of the parties,” the commission said.

Further, the commission said, both Grand View and Idaho Power were parties
to the case that determined REC ownership and Grand View did not raise the
issue or petition for judicial review at that time.

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