20111216notice_of_application_order_no_32414.pdf

Office of the Secretary
Service Date
December 16,2011
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )
OF IDAHO POWER COMPANY FOR A )CASE NO.IPC-E-I1-26
DETERMINATION REGARDI?G ITS )
FIRM ENERGY SALES AGREEIENT )NOTICE OF APPLICATION
WITH HIGH MESA ENERGY,LLC )
)NOTICE OF
)MODIFIED PROCEDURE
)
_____________________________
ORDER NO.32414
On November 22,2011,Idaho Power Company filed an Application with the
Commission requesting acceptance or rejection of a 20-year Firm Energy Sales Agreement
(Agreement)between Idaho Power and High Mesa Energy,LLC (High Mesa)dated November
16,2011.The Application states that High Mesa would sell and Idaho Power would purchase
electric energy generated by the High Mesa wind project (Facility)located near Bliss,Idaho.
Idaho Power requests that its Application be processed by Modified Procedure.
NOTICE OF APPLICATION
YOU ARE HEREBY NOTIFIED that the Application states that High Mesa proposes
to own,operate and maintain a 40 MW (maximum capacity,nameplate)generating facility.
Application at 2.The Facility will be a QF under the applicable provisions of the Public Utility
Regulatory Policies Act of 1978 (PURPA).
A.The Agreement
YOU ARE FURTHER NOTIFIED that the Agreement is for a term of 20 years and
contains avoided cost rates calculated through the use of the Integrated Resource Plan (IRP)
methodology.Idaho Power notes that the energy price identified by the IRP methodology for
this Facility is equivalent to a 20-year levelized price of $56.43 per MWh.’Application at 4.
YOU ARE FURTHER NOTIFIED that the Agreement includes “split ownership”of
the Renewable Energy Certificates (RECs)generated over the 20-year term of the Agreement.
Id.at 3.
The actual energy pricing stream varies throughout the term of the contract based upon the time of year and time of
day during which the energy is delivered to Idaho Power.
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO.32414 1
YOU ARE FURTHER NOTIFIED that High Mesa selected November 1,2012,as its
Scheduled First Energy Date and December 28,2012,as its Scheduled Operation Date.Id.at 2.
Idaho Power asserts that various requirements have been placed upon the Facility in order for
Idaho Power to accept the Facility’s energy deliveries.Idaho Power states that it will monitor
the Facility’s compliance with initial and ongoing requirements through the term of the
Agreement.
YOU ARE FURTHER NOTIFIED that the Application maintains that all applicable
interconnection charges and monthly operation or maintenance charges under Schedule 72 will
be assessed to High Mesa.Idaho Power states that the Facility is currently in the generator
interconnection process.“Upon resolution of any and all upgrades required to acquire
transmission capacity for this Facility’s generation,and upon execution of the FESA and the
GIA,this Facility may then be designated as a network resource.”Id.at 5.High Mesa and
Idaho Power have agreed to liquidated damage and security provisions.Agreement ¶5.3,5.8.1.
YOU ARE FURTHER NOTIFIED that Idaho Power states that the Facility has also
been made aware of and accepted the provisions in the Agreement and Idaho Power’s approved
Schedule 72 regarding non-compensated curtailment or disconnection of its Facility should
certain operating conditions develop on Idaho Power’s system.The Application notes that the
parties’intent and understanding is that “non-compensated curtailment would be exercised when
the generation being provided by the Facility in certain operating conditions exceeds or
approaches the minimum load levels of [Idaho Power’s]system such that it may have a
detrimental effect upon [Idaho Power’s]ability to manage its thermal,hydro,and other resources
in order to meet its obligation to reliably serve loads on its system.”Application at 6.
YOU ARE FURTHER NOTIFIED that,by its own terms,the Agreement will not
become effective until the Commission has approved all of the Agreement’s terms and
conditions and declares that all payments made by Idaho Power to High Mesa for purchases of
energy will be allowed as prudently incurred expenses for ratemaking purposes.Agreement ¶
21.1.
NOTICE OF MODIFIED PROCEDURE
YOU ARE FURTHER NOTIFIED that the Commission has determined that the
public interest may not require a formal hearing in this matter and will proceed under Modified
Procedure pursuant to Rules 201 through 204 of the Idaho Public Utilities Commission’s Rules
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO.32414 2
and written comments have proven to be an effective means for obtaining public input and
participation.
YOU ARE FURTHER NOTIFIED that any person desiring to state a position on this
Application may file a written comment in support or opposition with the Commission no later
than January 26,2012.The comment must contain a statement of reasons supporting the
comment.Persons desiring a hearing must specifically request a hearing in their written
comments.Written comments concerning this Application shall be mailed to the Commission
and Idaho Power at the addresses reflected below:
Commission Secretary Donovan E.Walker
Idaho Public Utilities Commission Idaho Power Company
P0 Box 83720 1221 West Idaho Street
Boise,ID 83720-0074 P0 Box 70
Boise,ID 83707-0070
Street Address for Express Mail:E-Mail:
472 W.Washington Street
Boise,ID 83702-5918 Randy C.Aliphin
Energy Contract Administrator
Idaho Power Company
1221 West Idaho Street
P0 Box 70
Boise,ID 83707-0070
E-Mail:jjhinidahopower.corn
These comments should contain the case caption and case number shown on the first page of this
document.Persons desiring to submit comments via e-mail may do so by accessing the
Commissions home page located at www.puc.idaho.gov.Click the ‘comments and Question’
icon and complete the comment form using the case number as it appears on the front of this
document.These comments must also be sent to Idaho Power at the e-mail addresses listed
above.
YOU ARE FURTHER NOTIFIED that Idaho Power and High Mesa may file reply
comments (if necessary)no later than February 2,2012.
YOU ARE FURTHER NOTIFIED that if no written comments or protests are
received within the time limit set,the Commission will consider this matter on its merits and
enter its Order without a formal hearing.If written comments are received within the time limit
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDERNO.32414
set,the Commission will consider them and,in its discretion,may set the same for formal
hearing.
YOU ARE FURTHER NOTIFIED that the Application has been filed with the
Commission and is available for public inspection during regular business hours at the
Commission offices.The Application is also available on the Commission’s web site at
www.puc.idaho.gov by clicking on “File Room”and then “Electric Cases.”
YOU ARE FURTHER NOTIFIED that all proceedings in this case will be held
pursuant to the Commission’s jurisdiction under Title 61 of the Idaho Code and the Public Utility
Regulatory Policies Act of 1978 (PURPA).The Commission has authority under PURPA and
the implementing regulations of the Federal Energy Regulatory Commission (FERC)to set
avoided costs,to order electric utilities to enter into fixed-term obligations for the purchase of
energy from qualified facilities and to implement FERC rules.
YOU ARE FURTHER NOTIFIED that all proceedings in this matter will be
conducted pursuant to the Commission’s Rules of Procedure,IDAPA 31.01.01,000,et seq.
ORDER
IT IS HEREBY ORDERED that this case be processed under Modified Procedure.
Interested persons and the parties may file written comments no later than January 26,2012.
IT IS FURTHER ORDERED that Idaho Power and High Mesa may file reply
comments (if necessary)no later than February 2,2012.
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO.32414 4
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this /5
day of December 2011.
c ,‘
PAUL KJ LLNDEk,PRESIDENT
\I -N..7 N,
NJ
MACK A.REDFORD,COMMISSIONER
\,—-_l:/
0 A
MARSHA H.SMITH,COMMISSIONER
ATTEST:
/./
Jean D Jewel],
Commission secretary
O:IPC-E-1 1-26_ks
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO.32414 5