20120103Complaint.pdf

r: E:Peter J. Richardson (lSB # 3195)
Gregory M. Adams (lSB # 7454)
Richardson & O'Lear, PLLC
515 N. 27th Street
P.O. Box 7218
Boise, Idaho 83702
Telephone: [phone]
Fax: [phone]
peter(ßrichardsonandolear.com
greg(ßrichardsonandolear .com
2312 -3 Pi" 2: 39
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t.J'Tilt'T\
Attorneys for Complainants
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
GRA VIEWPV SOLAR THREE, LLC,
Complainant,
GRAD VIEW PV SOLAR FOUR, LLC
Complainant,
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) Case No. IPC-E-12-..
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) FORMAL COMPLAINT
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vs.
IDAHO POWER COMPANY,
Defendant.
1 INTRODUCTION
2 This is a formal complaint fied by Grand View PV Solar Three, LLC and Grand View
3 PV Solar Four, LLC (collectively "Grand View") with the Idao Public Utilities Commission
4 (the "Commission") pursuat to Idao Administrative Rules 31.01.01.054. On Febru 15,
5 2011, Grand View PV Solar Three, LLC and Grand View PV Solar Four first requested that
6 Idaho Power Company ("Idaho Power") execute standard Public Utility Regulatory Policies Act
7 of 1978 ("PURPA") power purchase agreements ("PPA") for qualifying facilties ("QFs") using
8 the Integrated Resource Plan ("IRP") methodology for Grand Views' renewable energy QFs.
9 Because Idaho Power has not negotiated in good faith in response to Grand View's attempts to
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1 obligate themselves to the terms of stadard PP As using the IRP derived avoided cost rates,
2 Grand View respectfully requests that the Commission issue a declaratory judgment order that
3 they are entitled to such PP As and fuher requests that the Commission order Idaho Power to
4 enter into PP As using the IRP methodology and relevant inputs and resulting rates as of the date
5 Grand View PV Solar Three and Grand View PV Solar Four obligated Idaho Power to purchase
6 their renewable energy which date is no later than July 2, 2011.
7 PRELIMINARY MATTERS
8 Copies of all pleadings and other correspondence in this matter should be served upon
9 counsel for Grand View at:
10 Peter J. Richardson11 Gregory M. Adams12 Richardson & O'Lear, PLLC13 515 N. 27th Street14 P.O. Box 721815 Boise, Idaho 8370216 Telephone: [phone] Fax: [phone]
peter(ßrichardsonandolear.com18 greg(ßrichardsonandolear.com
19
20 In support of this Complaint, Grand View alleges as follows:
21 IDENTITY OF PARTIES
22 1.Idaho Power is an Idaho Corporation with its principal place of business at 1221
23 West Idaho Street, Boise, Idaho 83702. Idaho Power Company is an electric company and a
24 public utilty subject to the jursdiction and regulation of the Idaho Public Utilties Commission
25 pursuant to I.C. § 61-129. Idaho Power is subject to the jurisdiction of the Commission, the
26 Public Utilty Commission of Oregon, and the Federal Energy Regulatory Commission
27 ("FERC").
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2. Grand View PV Solar Three, LLC is an Idaho limited liabílity company, duly
registered to conduct business in the State ofIdaho. Grand View PV Solar Four is also an Idaho
limited liability company duly registered to conduct business in the State of tdao. Both are
quaifying facilities under the Public Utility Regulatory Policies Act of 1978.1
JURISDICTION
3. This case involves PURPA's avoided cost provisions and FERC's implementing
regulations thereto, which PURPA directs states to implement. See 16 U.S.C. § 824a-3 (a)-(n);
FERC v. Mississippi, 456 U.S. 742, 751 (1982). In Idaho, the Commission possesses jurisdiction
over complaints regarding rates of public utilities, including PURPA rates. I.C. §§ 61-129, -501.
-502, -503, -612; see also Afton Energy Inc. v. Idaho Power Co., 111 Idao 925, 929, 729 P. 2d
400, 404 (1986). The Commission has jursdiction to issue declaratory judgments regarding
utilty contracts pursuant Idaho's Declaratory Judgment Act, I.C. § 10-1203. See Utah Power
and Light v. Idaho Pub. Utilties Commission, 112 Idaho 10, 12, 730 P.2d 930,932 (1986).
APPLICABLE LAWS AND REGULATIONS
4. Section 210 of PURP A requires electrc utilties to purchase power produced by
small power producers that obtain QF status under section 201. 16 U.S.C. § 824a-3(a)(2). FERC
rules provide QFs with the option of sellng electricity and capacity to a utility based on the
utility's "avoided costs" at the time the QF incurs a legally enforceable obligation to deliver
energy or capacity over a specified term. See 18 C.F.R. § 292.304(d)(2)(ii). Thus, "a QF, by
committing Itselfto sell to an electric utilty, also commits the electric utilty to buy from the QF;
these commitments result either in contracts or in non-contractual, but binding, legally
enforceable obligations." JD Wind 1, LLC, 129 FERC ~ 61,148, at p. 10-11 (November 19,
2009); Cedar Creek Wind 137 FERC ~ 61,006 at p. 13.
1 Grand View PV Solar Thee, LLC FERC No. QF-I 1-403; Grand View PV Solar Four FERC No. QF-I 1-404.
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FACTUAL BACKGROUND
5. Grand View PV Solar Thee, LLC and Grand View PV Solar Four, LLC, are
companion projects being developed by Alternative Power Development, Northwest, LLC,
which is the same entity that developed Grand View PV Solar One.
6. This Commission approved the 20 MW power purchase agreement for Grand
View PV Solar One in September 2010 in Order No. 32068 in Docket No. IPC-E-I0-19.
7. Grand View PV Solar Two, LLC is also a companion project to the Grand View
projects and is being developed by the same developer.
8. Grand View Solar PV Two, LLC curently has a complaint pending before this
Commission relative to the ownership of the environmental attbutes associated with the
generation of renewable energy that is sold to Idaho Power pursuant to a PURP A contract. That
complaint was lodged before the Commission on August 2, 2010. The Commission has yet to
rule on that complaint.
9. Grand View PV Solar Two is in the final stages of securing a generator
interconnection agreement with Idaho Power.
10. With the exception ofthe ownership ofRECs, Grand View PV Solar Three and
Grand View PV Solar Four were ready to execute the stadard Idaho Power PP A containing IRP
methodologically derived avoided cost rates on July 2, 2011.
11. Grand ViewPV Solar Three, LLC, and Grand View PV Solar Four, LLC have
been actively engaged in the development of their respective Solar Projects. Each project has a
nameplate capacity rating of 20 MW and is entitled to IRP methodologically derived rates as the
developer/owner of the projects will average monthly production that is too high to qualify for
published avoided cost rates.
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12. Grand View has made substantial investments in development of the two projects,
and the projects are mature and entitled to obligate themselves to long-term PP As for PURP A
QFs under IRP methodologically derived rates.
13. Grand View has been in contact with Idaho Power's transmission business line for
a substatial amount of time regarding the site and the specifics of interconnection and sale of its
output.
14. Interconnection studies have been conducted and deposits made for Grand View
PV Solar One and Two.
15. Because of that work conducted by its companion projects, Grand View PV Solar
Three and Grand View PV Solar Four fully understand the ability ofIdaho Power's system to
absorb the full 80 MW output of all four projects and are prepared to reimburse Idaho Power for
the costs of upgrading the adjacent substation, the Canyon Creek substation.
16. Grand View first requested power purchase agreements for the two projects on
Februar 15,2011 via letter request from its counsel to the Idaho Power PURPA contract
administrator.
17. Also on Febru 15,2011, Grand View provided the Idao Power PURP A
contract administrator with an electronic fie containing the estimated production from the two
projects for one full year on an hourly basis.
18. Grand View made repeated requests for contracts for the two projects subsequent
to that date.
19. Grand View PV Solar Three, LLC, and Grand View PV Solar Four, LLC, again
made formal wrtten requests for power purchase agreements through letters sent by their
counsel on July 2, 2011.
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20. During the month of July, Idao Power and Grand View PV Solar Two were in
active negotiations over environmental attibute language in the stadard PP A. The results of
said negotiations had the potential to impact language in the standard PURP A contract for all
three projects - Grand View PV Solar Two, -Three and -Four.
21. On July 10,2011, in an email communcation from Idaho Power via its counsel,
Idaho Power admitted that all of the contract terms were agreed upon except for the ownership of
environmenta attibutes.
22. On July 10,2011 Grand View PV Solar Two declined to sign the stadard
contract offered by Idaho Power due to Idaho Power's instace on language dealing with
environmental attribute language that was unacceptable to Grand View PV Solar Two, LLC.
23. On July 26, 2011, Idaho Power through an email communication from its counsel
reiterated its position that the contracts tendered to Grand View PV Solar Two, LLC were
complete in all respects except for the dispute over environmenta ownership attbutes.
24. On August 2,2011. Grand View PV Solar Two lodged its complaint against
Idaho Power on the sole issue of ownership of environmenta attributes.
25. On September 1, 2011, Grand View PV Solar Three, LLC and Grand View PV
Solar Four, LLC, through their counsel sent an email communcation to Idaho Power's PURPA
contract administrator with a copy of the July 2,2011, letters formally requesting PPAs for
Grand View PV Solar Three, and Grand View PV Solar Four asking for the requested PPAs.
26. On September 6, 2011, Idaho Power responded that it had "assumed that Grand
View solar would be waiting for the resolution of (its)...complaint before proceeding with these
contracts for projects 3 and 4."
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1 27. Grand View gave Idaho Power no reason to make the assumption that it was
2 "waiting for the resolution" of Grand View PV Solar Two's complaint on ownership of
3 environmental attributes. That complaint is curently fuly submitted before the Idaho PUC and
4 no decision has been issued.
5 28. In mid-September Idaho Power asked for estimated production data related to
6 Grand View's projects. Said data had already been previously provide on Febru 15,2011 and
7 offered in Grand View's July 2,2011 letter.
8 29. Grand View promptly again provided the requested production data on September
9 12,2011. Grand View was led to believe that it could take several weeks to ru the IRP
10 methodology for determining avoided cost rates.
11 30. On October 11,2011, Idaho Power fied a contract with Interconnect Solar for
12 Commission approval that contained IRP methodologically derived rates for a solar project with
13 rates that would have been acceptable to Grand View.
14 31. On October 21, 2011, Grand View's counsel sent an email inquiry as to the status
15 of the PPAs for Grand View PV Solar Three and Grand View PV Solar Four.
16 32. Idaho Power did not respond.
17 33. On November 21, 2011, Grand View inquired of the Idaho Power PURP A
18 contract administrator as to the status of the PPAs for Grand View PV Solar Three and Grand
19 View PV Solar Four.
20 34. Idaho Power did not respond.
21 35. In the early mornng of December 1,2011, Grand View again inquired of the
22 Idaho Power PURP A contract administrator as to the status of the PP As for Grand View PV
23 Solar Three and Grand View PV Solar Four.
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36. Later that morning on December 1,2011 Idaho Power's PURA contract
administrator replied that due to the Thansgiving Holiday he had been unavailable but that he
would "let you know today or tomorrow on the timing of me getting the draft contracts back to
you."
37. Stil later the mornng of December 1,2011, Grand View, through its counsel
again sent an email communication to Idaho Power's PURPA contract administrator with a copy
of the July 2, 2011, letters formally requesting PPAs for Grand View PV Solar Three, and Grand
View PV Solar Four pointing out that the formal request was made for these PPAs before the
Fourh of July Holiday -- not the Thansgiving Holiday.
38. The very next day, on December 2,2011, Idaho Power provided the PPA attached
hereto as Exhibit A, asserting that it is the proposed PP A for the Grand View PV Solar Two,
Three and Four projects.
39. The contract Idaho Power provided on December 2,2011, is defective because it
contains rates that were not calculated using the inputs to the IRP methodology that were
relevant on July 2,2011.
40. The contract Idaho Power provided on December 2,2011, is defective because it
contains language related to preventative maintenance during periods of "low wind availability"
in section 1.12.
41. Grand View PV Solar Three and Grand View PV Solar Four did not request a
wind motive force contract from Idaho Power.
42. The contract Idaho Power provided on December 2,2011, is defective because it
deletes seasonally differentiated rates.
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43. The contract Idaho Power provided on December 2, 2011 is defective because at §
26.1 it requires compliance with 38 U.S.C. § 4212 which code section provides in par, that "Any
contract in the amount of$100,000 or more entered into by any department or agency of the
United States for the procurement of personal property and non personal services (including
construction) for the United States, shall contain a provision requiring that the party contracting
with the United States take affrmative action to employ and advance in employment qualifed
covered veterans. "
44. Neither Grand View PV Solar Three nor Grand View PV Solar Four are
proposing to sell their electric output to any deparent or agency of the United States.
45. The contract Idaho Power provided on December 2,2011 is defective because at §
26.1 it requires compliance with Executive Order No. 11246 which order prohibits federal
contractors and subcontractors and federally-assisted constrction contractors and subcontractors
that generally have contracts that exceed $10,000 from discriminating in employment decisions
on the basis of race, color, religion, sex, or national origin. It also requires covered contractors to
tae affirmative action to ensure that equal opportunty is provided in all aspects of their
employment.
46. Neither Grand View PV Solar Three nor Grand View PV Solar Four are federal
contractors.
47. The contract Idaho Power provided on December 2, 2011 is defective because it
contains language at § 8.1 clouding title to environmental attbutes.
48. Despite Grand View's efforts, Idaho Power has acted in bad faith by failing to
provide a contract for execution containing the IRP methodologically derived avoided cost rates
and standard terms and conditions for PURP A contracts as of July 2, 2011.
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1 49. Had Idaho Power timely responded to Grand View's repeated requests for
2 contracts containing the IRP methodologically derived avoided cost rates and the stadard terms
3 and conditions in effect at the time Grand View created a legally enforceable obligation it would
4 have tendered a contract with rates similar to, if not identical to, the rates contained in
5 Interconnect Solar's IRP methodology contact. See In Re: Interconnect Solar IPC-E-II-I0.
6 50. Idaho Power provided Grand View with a contract on December 2,2011 that
7 contains rates substatially below the rates it offered to Interconnect Solar in October 2011.
8 51. Despite Grand View's protests to the contrar, Idaho Power continues to insist
9 that the rates, terms and conditions in the attched contract are the appropriate rates and terms for
10 Grand View's projects.
11 LEGAL CLAIM
12 Complainant's Claim for Relief
13 Idaho Power is in violation ofPURPA, FERC's regulations and orders, and the
14 Commission's orders by failng to provide Grand View PV Solar Three, LLC and Grand
15 View PV Solar Four, LLC with power purchase agreements with IRP calculated avoided
16 cost rates and standard contract terms and conditions in effect on July 2, 2011.
17 52. Grand View re-alleges and incorporates all preceding paragraphs.
18 53. Grand View has attempted in good faith to engage in negotiations to obtain fully
19 executed power purchase agreements to deliver energy and capacity to Idaho Power from the two
20 solar projects they are developing.
21 54. Grand View PV Solar Three and Grand View PV Solar Four committed
22 themselves to sell energy and capacity from their Idaho QFs to Idaho Power at a time when the
23 inputs to the IRP methodology would have produced rates similar to the rates contaned in the
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Interconnect Solar contract and, consequently, Grand View has committed Idaho Power to buy
from them at those rates.
55. These commitments result in non-contractual, but binding, legally enforceable
obligations. 18 C.F.R. § 292.304(d)(2)(ii); JD Wind 1, LLC, 129 FERC ~ 61,148, at pp. 10-11;
Cedar Creek Wind, LLC, 137 FERC 61,006 at ~ 35-37.
56. By negotiating in bad faith and by failing to execute a PP A, Idaho Power is in
violation ofPURPA, FERC's implementing regulations, and the Commission's orders. See 16
U.S.C. § 824a-3(a)(2); 18 C.F.R. § 292.304(d)(2)(ii); Blind Canyon Aquaranch v. Idaho
Power Company, Case No. IPC-E-94-1, Order No. 25802 (November 1994).
PRAYER FOR RELIEF
WHEREFORE, Grand View PV Solar Three, LLC and Grand View PV Solar Four, LLC
respectfully request that the Commission issue an Order:
1. Declarng that Idaho Power is in violation ofPURPA, FERC's implementing
regulations, and the Commission's orders.
2. Requiring Idaho Power to execute a standard PURP A power purchase agreement
containing IRP derived avoided cost rates using the methodological inputs that were used in
calculating the Interconnect Solar rates for Grand View PV Solar Thee, LLC and Grand View
PV Solar Four, LLC.
3. Granting any other relief that the Commission deems necessar.
Respectfully submitted this 3rd day of Januay, 2012
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RICHASON AND O'LEARY, PLLC
i4-g~ ~
Gregory M. Adams (ISB No. 7454)
Attorneys for Complainant
Page 12 - FORMAL COMPLAIT
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on this 3rd day of 2012, I caused a tre and correct
copy of the foregoing Complaint of Grand View PV Solar Three, LLC and Grand View PV
Solar Four, LLC to be served by the method indicated below, and addressed to the following:
Jean Jewell
Idaho Public Utilities Commission
472 West Washington Street
Post Office Box 83720
Boise, Idaho 83720-0074
( ) U.S. Mail, Postage Prepaid
() Hand Delivered
( ) Overnght Mail
( ) Facsimile
( ) Electronic Mail
Donovan Walker
Randy Allphin
Idaho Power Company
PO Box 70
Boise,ID 83707-0070
bkline(ßidahopower.com
mmoen(qidahopower.com
( ) U.S. Mail, Postage Prepaid
~ Hand Delivered
( ) Overnight Mail
( ) Facsimile
( ) Electronic Mail
Lisa Nordstrom
Deputy Attorney General
Idaho Public Utilties Commission
PO Box 83720
Boise,ID 83720-0074
lnordst(ßpuc.state.id. us
( ) U.S. Mail, Postage Prepaid
C: Hand Delivered
( ) Overnight Mail
( ) Facsimile
( ) Electronic Mail
signedOLIb ib ÛJ~
Nina M. Curis
Complaint of Grand View PV Solar Two, LLC and Grand View PV Solar Four, LLC
CERTIFICATE OF SERVICE - 1