20120109Complaint.pdf

McDevitt & Miller LLP
Lawyers ".,~ ,'~'"
t:, t.l
[phone]
[phone] (Fax)
420 W. Bannock Street
P.O. Box 2564-837ÓÌl12 JAN -9 Pt'l 3= II
Boise, Idaho 83702
Chas. F. McDevitt
Dean J. (Joe) Miler
Janua 9, 2012
Via Hand Delivery
Jean Jewell Secreta
Idaho Public Utities Commssion
472 W. Washigton St.
Boise, Idaho 83720
Re: Hoku Materials, Inc. v. Idaho Power
Case No. IRS £ Ie
Dear Ms. Jewell:i pc., E -11~O1-
Enclosed for fig in the above matter, please fid an orial and seven (J) copies of Hoku
Materials, Inco's Complat for Contract Reformtion and Reparations.
Kidly retu a fie staped copy to me.
Very Truy Yours,
McDevitt & Mier UP
~WL
Dean J. Mier
DJM/hh
End.
ORlGINAL
Dea 1. Miller (lSB No. 1968)
Chas. F. McDevitt (ISB No. 835)
McDEVITT & MILER LLP
420 West Banock Street
P.o. Box 2564-83701
Boise, il 83702
Tel: [phone]
Fax: [phone]
joe&Jcdevitt-miller.com
f',ni "1
LV 11.-9 PH 3: 12
Attorneys for Hoku Materials, Inc.
Cl
1:"
BEFORE TH IDAHO PUBLIC UTILITIES COMMSSION
Case No.
HOKUMATERILS INC,
Complainant,
COMPLAINT FOR CONTRACT
REFORMTION AND
REPARTIONSv.
IDAHO POWER COMPANY,irê-e-l?--Di
Res ondent.
COMES NOW Hoku Materials Inc., ("Hoku"), pursuat to RP 54, and for claims against
Idaho Power Company ("Idaho Power", ''te Company", "IPCo") complains and alleges as
follows, to wit:
STATEMENT OF FACTS
1. Hoku is a corporation organzed and existing under the laws of the State of Delaware and
authorized to conduct business in the State ofIdaho.
2. Hoku is constrcting a manufactung facilty in Pocatello, Idaho, for the purose of
manufactug, marketing and selling polysilcon to the solar industr ("Facilty").
3. Idaho Power Company is an electrc utilty company subject to the jursdiction of the
Idaho Public Utilties Commission ("Commssion").
COMPLAINT FOR CONTRACT REFORMATION AN REPARATIONS.l
4. On September 17,2008, Hoku and Idaho Power entered into an Agreement for Electrc
Service for the supply of electrc power and energy to the Facilty. On June 19,2009, Hoku and
Idaho Power entered into an Amended and Restated Agreement for Electrc Servce ("AESA")
which superseded and replaced the September 17, 2008, Agreement for Electrc Service. On
July 24,2009, the Commssion entered Order No. 30869, Case No. IPC-E-08-21 approvig the
AESA. A tre and correct copy of the AESA is atthed hereto as Exhbit 1.
5. Pursuat to the AESA, Hoku's demand and energy requirements are divided into two
blocks for pricing puroses. The AESA defies First Block Contract Demand and the number of
kilowatts Idaho Power ha agreed to make available as listed in Section 6 of the AESA. First
Block Energy is the number of kilowatt hours determed by multiplying the First Block
Contrct Demand by the number of hours in the biling period, multiplied by the Contract Load
Factor. Under the AESA, commencing in April of 20 11, Hoku is obligated to pay the First
Block Demand and Energy Charges regardless of whether it actully consumes or demands
energy.
6. The AESA establishes a rate for First Block Energy charges of $.061660. The AESA
rate for First Block Energy charges was established by reference to Idaho Power's then existing
published avoided costs. Since 2009 the Commssion has entered orders lowering Idao Power's
avoided costs and curent avoided costs are approximately 12% lower th the First Block
Energy rate contaned in the AESA.
7. Hoku re-alleges as if fuly set fort herein, and incorporates by reference, paragraphs 9-
12 of Hoku's Response to Idaho Power Pleadings, fied contemporaneously herewith.
COMPLAINT FOR CONTRACT REFORMATION AN REPARTIONS-2
8. At the tie the AESA was executed it was the mutual assumption of the paries that the
polysilcon deposition reactors would be energized and operational, and Hoku would begin its
production ramp-up by December 1,2009.
9. Through a series of events and circumstaces beyond the control of Hoku, although some
of the polysilcon deposition reactors have been energized and become operational, Hoku has not
yet begu its production ramp-up.
10. Paragraph 5.7 of the AESA provides:
"Release of First Block Energy: With adequate notice and the written consent of Idaho
Power, Hoku may request a release of all or par of its First Block Energy purchase
commitment in retu for credit on its First Block Energy Charge. The value of the credit
will be determined by mutual agreement and will tae into consideration the timing of the
notice and Idao P~:wer's, abilty to mange any supply commitments made on Hoku's
behalf."
11. In March, 2011, Hoku's officials met with Idaho Power's offcials at Idao Power's
offces and requested of Idaho Power a release of First Block Energy pursuant to paragraph 5.7
of the AESA. Idao Power uneasonably refused a release. On or about August 16,2011, Hoku
requested in wrting of Idaho Power a release of First Block Energy pursuat to Paragrph 5.7.
Idaho Power again uneasonably refused a release.
12. As wrtten, Paragraph 5.7 is contrar to the public interest because it vests sole discretion
in Idaho Power Company.
STATEMENT OF LEGAL AUTHORITY
13. Whle Hoku acknowledges that the Commssion does not have authority to alter a
contract merely to relieve one or the other of the pares from an unprofitable or injudicious
undertng, the Commission does have the authority and the responsibilty to reform or alter
terms of contracts that are contrar to the public interest. The Idaho Supreme Cour ha
confrmed the Commission's authority to modify contrcts when required by the public interest.
COMPLAINT FOR CONTRACT REFORMATION AN REPARATIONS.3
See Agricultural Products v. Utah Power & Light, 98 Idaho 23,557 P.2d 617 (1976). And,
Idaho Power Company has recently acknowledged ths authority in pleadigs fied with the
Commission:
"The Commssion, in its role as the reguatory authority for all investor owned, public
utilties in the state of Idaho, has an independent obligation and duty to assure that all
contracts entered into by the public utilties it reguates are ultiately in the public interest.
In the state of Idaho, contracts are aforded constitutiona protection againt interference
from the State. Idao Const. Ar. I, § 16. However, despite ths constitutional protection, the
Commission may anul, supersede, or reform the contracts of the public utilties it regulates
in the public interest. Agricultural Products Corp. V. Utah Power & Light Co., 98 Idaho 23,
29,557 P.2d 617,623 (1976) ("Interference with private contracts by the state reguation of
rates is a valid exercise of the police power, and such regulation is not a violation of the
constitutional prohibition agaist impaient of contractu obligations. "); see also Federal
Power Comm's v. Sierra Pac. Power Co., 350, US. 348, 76 S.Ct. 368, 100 L.Ed. 388 (1 956);
United Gas Pipe Line Co. v. Mobile Gas Service Corp., 350 U.S. 332, 76 S.Ct. 373, 100
L.Ed. 373 (1956) (U.S. Supreme Cour fiding that rates fixed by contract could be modified
only "when necessar in the public interest"). The Commssion may interfere in such a way
with the contracts of a public utility only to prevent an adverse afect to the public interest.
Agricultural Products, 98 Idaho at 29. "Private contrts with utilities are regarded as entered
into subject to reserved authority of the state to modify the contract in the public
interest."Id." See Reply Comments ofIdao Power Company, Case No. IPC-E-10-59.
(2011).
The Commssion has recently exercised its public interest authority not merely to modify
contrcts, but to reject them entirely. See e.g. Order No. 32256, Case No. IPC-E-II-58, Order
No. 32298, Case No. IPC-E-51-55; Order No. 32255, Case No. IPC-E-II-57.
The AESA by its own terms implies that the Commission may modify contract terms.
Section 14.1 provides:
"The terms, conditions, and rates set fort in ths Agreement and Schedule 32 are subject
to the continuing jursdiction of the Commission."
COMPLAINT FOR CONTRACT REFORMATION AND REPAR TIONS-4
The Commission also has authority to require reparations for excessive or discriinatory
charges pursuat to Idaho Code §61-641:
"61-641. Overcharge-Reparation.-When complaint has been made to the
commission concernng any rate, fare, toll, renta or charge for any product, or
commodity, fushed or service performed by any public utilty, and the commission has
found, afer investigation, tht the public utilty has charged an excessive or
discriminatory amount for such product, commodity or service, the commission may
order that the public utilty make due reparation to the complainant therefor, with interest
from the date of collection: provided, no discrimination will result from such reparation.
(1913, ch. 61, § 67a, p. 247; reen. C.L. 106:147; C.S.,§ 2515; I.C.A., § 59-641.)"
FIRST CLAIM FOR RELIEF-CONTRACT REFORMATION
14. Paragraph 5.7 should be reformed to provide:
"Release of First BlockEnergy: With adequate notice and the wrtten consent ofIdaho
Power or by order of the Commission, Hoku may request a release of all or par of its
First Block Energy purchase commtment in retur for credit on its First Block Energy
Charge. The value of the credit will be determed by mutu agreement or by order of
the Commission and will tae into consideration the timing of the notice and Idao
Power's abilty to manage any supply commitments made on Hoku's behalf."
SECOND CLAIM FOR RELIEF-REPARTIONS
15. Hoku is entitled to reparations for First Block Energy and Demand payments in an
amount to be determined by the Commssion.
TmRD CLAIM FOR RELIEF-8USPENSION OF FIRST BLOCK ENERGY
16. The Commission should enter its order releasing First Block Energy charges until such
time as Hoku is prepared to commence the production ramp-up of its polysilcon deposition
reactors.
WHEREFORE, Hoku respectfuly requests of the Commission that:
1. Reform the ARSA as herein requested.
2. Release Firt Block Energy as herein requested.
3. Award to Hoku repartions in an amount to be determined.
COMPLAINT FOR CONTRACT REFORMATION AN REPARTIONS.5
4. Grant such other relief as is appropriate in the circumtace.
DATED this U\ day of Janua, 2012...
HOKU MATERIALS, INC
By:~\l_Q~
Dean J. ~Î1er
Attorney for Hoku Materials, Inc.
COMPLAINT FOR CONTRACT REFORMATION AND REPARTIONS-6
CERTIFICATE OF SERVICE
I hereby certify that on theQ~ay of Janua, 2012, I caused to be served a tre and
correct copy of the foregoing document, upon:
Jean Jewell, Secretar
Idaho Public Utilties Commission
472 West Washington Street
P.O. Box 83720
Boise,ID 83720-0074
jjeweiicguc.state.id. us
Hand Delivered
U.S. Mail
Fax
Fed. Express
Email
Lisa D. Nordstrom
Idaho Power Company
1221 W. Idao St. (83702)
POBox 70
Boise, ID 83707-0070
lnordstrom(ßidahopower.com
Hand Delivered
U.S. Mail
Fax
Email
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McDEVITT & MILLER LLP
By~~\Q)
COMPLAINT FOR CONTRACT REFORMATION AN REPARATIONS-7
AMENDED AND RËSTATED ELECTRIC SERVICE AGREEMENT
BElEN
IDAHO POWER COMPANY
AND
HOKU MATERIALS, INC
. THIS AMENDED AND RESTATED AGREEMENT FOR ELECTRIC
SERVltE ("Agreement") is executed on June 19, 2009, by HOKU MATERIALS, INC, a
Delaware Corporation ("Hoku") and IDAHO POWER COMPANY, an Idaho Corporatiån
("Idåho Powåt'). . In consideration of the mutual covenants' hereinafter set forth, the
parties hereby agree as folloWs:
~. .
SECTION 1 - SPECIAL CONTRACT
1.1 . This Agreement is a Special Contract as described in Idaho .
Pow~ts Schedule 19. . This Agreement supercedes and replaces the Agreem$Rt for
Electric Service between the partes dated September 17,2008.
SECTION 2 - DEFINITIONS
. When used in this Agreement:
2.1' "Commission" shall mean the Idaho Public Utilities Commission or
its successor agency.
2.2. "Construction Agreemenl shall mean that certain Agreement for
Construction of Hoku Electric Substation and Associated Facilties dated as of
December 28, 2007, by and between Hoku and Idaho Power, as such måy be ameódedfrom time to time. .
2.3. "Cntract Load Factor" shall mean 90 percent for purposes of
establishing the energy blocks for monthly biling.
2.4. "Embedded Date" shall mean December 1, 2013.
2.5. "Embedded Rate" shall mean the demand and energ: rates
. . detailad in the Company's then-effecive Schedule 1.9T. . .
2.6. "exce Demand'; shall mean the average kilowatts supplièd
during the coincident 15-cnsecive-minute period of maximum use each day, adjusted
for Power Factor, which exceeds. the Total Contrct Demand. . .
2.7. "Excess.Énergy" shall mean any kilowat-hòurs of energ supplied
to the Hoku Facilty during the. montly billng period as measured by the metering
equipment located at the:. Points of Delivery that exceeds the sum of the FirSt Bloc
Energy and the Second Block Energy. .
. 2,8. "First Blo~k Contract Demand" shall mean the monthly number of .
kilowatts Idaho Power has agreed to make available to the Hoku Facility in accrdance
with the Scheduled Contract Demand in Section 6.
1
EXHIBIT 1
PAGEloFl0
2.9. "First Block Energy" shall mean the kiloatt-hours determined by
multiplying the First Block Contract Demand by the numbe of hours in the biling period
multiplied by the Contrct load Factor.
2.10. "Hoku' Facilit shall mean the HokLÍ Polysilicon Production
complex ~oçated on One Hoku Way, Pocatello, Idaho. .
2.11. "Interconnecton Facilities" shall mean all facilties which are
reåsonably required by Prudent Electrical Practice and the National Electric Safety
Code to interconnect and deliver electrical power and energy to the Hoku Facilit,
. including, but not limited to, transmission facilties, substation facilties and metering
equipment.
. 2.12. "Minimum Biled Energy" shall mean the number of kilowatt-hours
determined by multiplying'50% of the Total Contract Demand for tne biling moi.h by the
number of hours in the billng month at the Contract load 'Factor.
. 2.13. "Points of Delivery shall mean the locations specifed In
paragraph 5.2 where the electcal facilties owned by Hoku are interconnected to th
electrical facilties owned by Idaho Power and where power and energy are delivered by
Idaho Power for the purpose of providing electrical service for the operat.ions of the. Hoku~~ .
2.14. "Power Factot' shall mean the percentage obtained by dividing
the maximum demand recorded in kW by the corresponding kilovolt-ampere (kVa)
demand established by Hoku.
, 2.15. "Prudent- Electcal Practces" shall mean thos practice, methods
and equipment that are conJmonly and ordinarily used in electcal engineering and utilty
operation to operate electcal equipment and deliver electric power and energy, with
safety, dependabilty, efciency and economy.
2.16. "Schedule 19" shall mean the Company's then effctive Idaho
Retail Tariff Schedule 19T.
2.17. "Schedule 32" shall mean the Hoku tariff schedule of rates and
charges 'or its successor schedules.
2.18. "Schecfuleçf Contract Demand" is defined in Section 6.1.1 below.
.2.19. . "Second Block Contract Demandu shall mean 25;000 kilowatts. .
2.20. "Second" Block Energy" shall mean' the total kilowatt-hours
supplied. to the Hoku Facilit during the monthly billng period as measured by the
metering equipment located at tne Point of Delivery less the Firs Block Energy, but no
:l greåter tha.n 25,000 kilowatt multiplied by the number of hours in the biling period
multiplied by the Contrct load Factor.
2.21. "Total Contract Demand" shall mean the sum of the First Block
Contract Demand and the Second Block Contract Demand as specified in Secton 6, and
as such may be modified pursuant to Secton 6.2 below:. .
2.22. "Transformer losses" shall mean energy losses resultng when a
transformer changes the voltage level of alternating currnt electricity.. . Transformer
. losses wil1 be accounted for in the initial metering instllation.
2
EXHIBIT 1
PAGE2oF10
SECTION 3 - TERM OF..AGREEMENT
, 3.1. , This Agreement sliall become effcte as provided in paragraph.
15.1 and remain in effect through the Embeded Date and wil be automaticaßy renewed
thereafter until either Hoku or Idaho Power terminates this Agreement as provided in
paragraph.41.
3.2 It is the intention of the partes that following the Embedded Date,
the parties shall enter into a new Special Contract whereby Hoku shall pay energy and.
demand rates that are equal to the lesser of the then-applicable Schedule 19 rate or the
average of the contract rates in Idaho Powets then-effecive other "Special Contractsø~
These Special Contract rates will remain in effect on an interim basis.until the next final
Commission ()rder in a general rate case proceeding.
3.3 Service under this Agreement will commence Decmber 1, 2009.' ,
SECTION 4 - TERMINATION
4.1 ,Notice of Termination: After the Embedded Date, either part to
this Agreement shall have the right to terminate this Agreem'ent by delivering wrtten
hotice of termination to the other part. The effectve date of termination'wllI be specified .
in the termination notice, but such effective date cannot be earlier than 12 months after'
the date of the delivery of the notice of termination. If, both parties give notice of
termination, the earliest effective date wil prevail. If the effective date of a teriination
occurs bef()re the new Special Contract is effective between the Parties as described in
Seclion 3.1 above, then the applicable energy and demand rates shall be'the EmbeddedRè '
SECTION 5 - SERVICES TO BE PROVIDED
5.1 Supply Obligation: In accordance with Prudent Electcal Pràctices
and the provisions of this Agreement, Idaho Power will furnish Hoku's tota requirements
for electric power and energy at the Hoku Facility. Hoku wil not resell any portion of the
power and energy fumished under this Agreement . .
, 5.2 Points of Delivery: Electric power and energy shail be delivered by
, Idaho Power, at each pòint generally described as the load side termin~ls of the
substation transforier 13.8 kilovolt disconnect switches at the Hoku Facilty. . .
'5.3 Adjustment for Transformer losses: Metering on, the load side of
the substation transformers wil be adjusted for Transformer losses.
5.4 Description of Electric Service: Idaho Power shall supply three-
phase, 60 hz alternating Currnt at nominal 13,800 volts, with a maxmum steady state
variation of plus or minus five percent (5%) under normal system conditions. Consistent
with Prudent. Electcal Practices, Idaho Power will operate within the capabilit of it
existing system to minimize voltage leveL fluctations, the normal frequency variation to,
be within plus or minus 0.05 hz on a 60 hz base.
5.5 Available Capaci: Idaho Power will make powe~ available to
Hoku in an amount equal to, the kilowatt of Total Contrct Demand shown in Secion6.1.1. .
3
EXHIBIT 1
PAGE 3 OF 10
5.6 Request for Propsals: During the inital term of the agrement, at
Hoku's request, Idaho Power will use commercally reasonable efforts to obtain
proposals to supply power to meet Hoku's summer loads not salVed by Idaho Power.
Idaho Power will customize such supply reuest to match Hoku's reuirements. These
additional purchases are subject to Idaho Powets abilit to deliver the power to Ho~u
and Hoku's accptance of the price and terms of the prposals. Hoku is reponsible for
the full costs of these purchases and any assocate trnsmission and ancillary seivice.
expense to transport such purchases to the Hoku Facilit,
5.7 Release of Firsl' Block Energy: Wit adeqate notice and the .
written consent of Idåho Power, Hoku may reuest a release .of all or part of its First
Block Energy purchase commitment in return for credit on its First Block Energ. Charge.
The value of the credit wil be determined by mutual agreement and wil take into
consideration the timing of the notice and Idaho Powets abilty to manage any supply
commitents made on Hoku's behalf. .
SECTION 6 - CONTRCT DEMAND
, 6.1 Contract Demand Provisions prior to the Embedded Data: The
following provisions apply. during the period of time from December 1, 2009 to the
Embedded Date, wni1e Hoku is changing its load at the Hoku Facilit.
6.1.1 Scheduled Contract Demand: Hoku agrees to contrct for, and'
Idaho Power agrees. tQ provide power made available to the. Hoku Facility in the
following amounts expressed in kilowatts (the "Scheduled Contract Demand"):
First BlockTime Contrct
Period Demand
. 12/1/2009 - 12/31/2009 ........1;000. ..
1/1/2010..1/31/2010.......,.......8~000
2/1/2010- 2128/2010...~........1.7,000
3/112010- 4/30/2010.............19,000.
511/2010- 6/1512010............32,000
6/16/2010- 8115/2010..........18,000
8116/2010- 9/1512010..........4,2,000
. 9/16/~010"" 12131/201.0. .....~.57,000
. 1/1/2011- 6/151201,1............57,00f!. .
6116/2111 ': 8I1512011....~...~ 18,000
8I16/2011-.9/15/2011.........~42,000
9/16/2011-12/31/2011 .......57,000
1/1/2012- 6/1512012............57,000
616/01,2 - 811512012..........18,000
Secnd Block
Contrct
Demand
25,000
25,000
25,000
25,000
25,00n
25,000
25,000
25,000
25,000
25,000
25,000
25,000
25,000
25,000
Total Contract
Demand
26,.000
33,000 .
42,000
'44,000
57,000
43,000
67,000
82,000
82,000
43,000
67,000'
82,000
82,000
43,000
4
EXHIBIT 1
PAGE40FI0
8116/2012., 9/15/2012..........42,000
9/16/2012-12/31/2012 .......57,000
1/1/2013-12/1/2013............57,000
25,000
25,00
25,000
67,000
82,000
82,000
; \
6.2 Contract Demand Provisions after Initial Expansion: Afer the.
Embedded Date, . Hoku has the option to incrse or decrease its. Total ContctDemand level as follows: . . .
6.2.1 Increases to Total Contrct Demand: Under the' terms of this .
Agreement, Hoku may increase the Total Contract Demand above 82,000 kilowatt by .
iiicr~asing the Firs Block Contract Demand in increments of 1,000 to 10,000 kilowats
per year up to a Total Contract Demand of 175,000 kilowatts. Hoku will" notify Idaho'
Power in writing of the additional capaci requirements at least one year in advance,
T.he new Total Contrct Demand wil be in effect for a minimum' of one year. Increases,
to .Total Contract Demand are subject to the availabilty of adequate capacit in Idaho
Powets facilities to provide the requested service.
. .
6.2.2 Decreases to Total Contrct Demand: After the Embedded Date,
Hokù n1ay decrease the Total Contract Demand by reducing the First Block. Contract
Demand in' decrements of 1,000 kilowatts. Total Contract Demand may not be
decreased below 25,000 kilowatts. Hoku will notif Id~ho Power in writing of th~
decrease in capacity requirements at least one year in advance. The new Total Contrct
Demand wil be in effect for R minimum of one year. .
6.3 Excess Demand: Prior to the. Embeded Date, and subject to
Section 6.2.1 above, the availabilty of power in excess of .the Total Contct Demand is
not guaranteed, and if the average kilowatts supplied 'atthe Hoku Facilty during the .15-
. consecutive-minute period of maximum use each day, adjusted 'for 'power fact.or,
exceeds the Total Contract Demand, Idaho Power may curtail servce to the Hoku
Facilit. Idaho Power reserves the right to install, at any time, at Hoku's expense, any
device necesary to protect Idaho Powets system from damage which may be ~used
by the taking of Exces Demand. Hoku will be responsible for any damages. to Idaho
. Powets system or damages to third parties resultng from the takíng of Excess Demand.
Hoku agrees to use its best reasonable effort to monitor its "electric loads and to advise,
Idaho Power as soon as possible of the potential for' Excess Demand at the Hoku
Facilty. Excess Demand will.be subjec to the Daily Excess Demand Charge and the
Monthly Excess Demand Charge specified in Schedule 32. .
6.4 Proration: Billngs . during months that contain a change in the
Scheduled' Contract Demand wil be prorated.
SECTION 7, - FACILITIES FOR DEUVERY TO HOKU FACILITY
7; 1 Additonal Facilites: The partes acknowledge that they have
separately entered into the Constrction Agreement, pursuant to which Hoku is paying
Idàho Power to constrct the Interconnection Facilties necessary to provide the Total
Contrct Demand under this Agi:ement. Idaho Power represents and warrants to Hoku
that none of the charges set forth in Schedule 32 include any cost reimbursement or
adjustment thát is already being paid by Hoku pursuant to the Constrction Agreement,
and that such Interconnecton. Facilties are sufcient to supply the Scheduled Contrct
Demand. To' the extent that additional transmission and/or substation Interconnection
5
EXHIBIT 1
PAGE 5 OF 10
Facilties are required to provide additonal servce pursuant to Section 6.2.1 above,
special arrngements will' be made il" a separate Agrement betwee Hoku and Idaho
Power.
7.2 Operaion and Maintenance: Idaho Powr will operate and
maintain Intercnnecton Facilities necesary to provide service to the Hoku Facilit.
Such Intercnn~on Facilities include Intercnection Facilites paid for by Hoku,
including those paid for by Hoku pursuant to the Construction Agreement. Idaho Power
shall operate and maintain such Interconnecton Facilities in accrdance with Prudenf
Electrical Practces.
SECTION 8 - CHARGES TO BE PAID BY HOKU TO IDAHO POWER,
8.1 Rates and Charges: Th rates and chares for electrical power,
energy'arid other service provided by Idaho Power to the Hoku Facilty are identifed !?y .
component in Schedule 32. The total amount to be paid by Hoku for electric service to
the Hoku Fàcilty wil be the sum of the components identifed on Schedule' 32.
8.2 Power Factor: When the Hoku Facilit's Power Factor is less than
95 percent during the 15-consecutive-minute period of maximum use ,for the monthly
billng period, Idaho Power wil determine the Total Billng Demand by multiplying the
metered demand in kilowatts by 0.95 and dividing that product by the Power Factor.
8.3 Biling and Metering Provisions: Idaho Power wil install and
maintain suitable metering equipment for each Point of Delivery so that coincident
,demand and e'nergy consumption can be determined for the billng penod.
8.4 First Block Contrct Demand Charge: The First Block Contract
Demand Charge is fixed and is not subject to change through the Embedded Date. After
the Embedded Date, the Contract'Demand Charge is subject to change and revision by
order 'of the Commission. After the Embedded Date, Idaho Power will advocate for
Commission acceptance of the ratemaking tratment for the Special Contract -described
in Section 3.2.above.
. 8.5 First Block Energy Charge: The First Block Energy Charge and.-
Excess Energy. Charge are fixed and are not subject to change through the Embedded
~ate. After the Embedded' Date, the Energy Charge and Exces Energy Charge are
subject to change and revision by order of the Commission. After the Embec!ded Date, .
Idaho Power will advocate for Commission accptance of the ratemaking treatment for
the Special Contract described in Secti~n 3.2 above.' ,
8.6 S~cond Block Charges: The Second Block Contract Demand
Charge and the Second Block Energ Charge wil increase or decrease uniformly wih
any base rate change aut!,rized,by the Commission that is applicable to Idaho Powets
Tari Schedule 19T through the Embedded Date. After the Embedded Date, the
Second Bloc Contract Demand Charge and the Second Block Energ Charge are
subjec to change and revision by order of the Commission.
8.7 Power Cost Adjustent: The Power Cost Adjustment (PCA) rate
as defined under Idaho Powets Tari Schedule 55 will be applied fo the SeCond Block
Energy only. The PCArate wil not apply to the First Block Energy or to Excess Energy.
8.8 Conservation lrogram Funding Charge: The Conservation
Program Funding Chare as specied in Idaho Powets Tariff Schedule 91 for Schedule
19 ~II be appli~ to the sum of the Second Block Charges, Excess .Demand Charges,
: 6
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and: Excess Energy Charges. Beginning December 1, 2011, the Consrvation Program
Funding Charge wil also apply to First Block Charges.
. 8.9' Minimum Energy Chatges: Each month Hoku will be biled ror the
actual metered kilowatt-hours of energy, but no less than the Minimum Biled Energ. .
amount defined in Section 2.12.
SECTION 9 - PAYMENT OF BILLSISETIEMENTS
9.1 Billng Data: Hoku shall pay Idaho Power for all services. provided
und~r this Agreement. Invoice for payment for electp service shall be prepared ånd '
submitted to Hoku monthly. All invoices or bils shall contain such data as may be
ré~onably required to substantiate the biling.
9.2 Payment Procedure: All bils or accounts for electric servce owed
by..Hok~ to Idaho Power hereunder shall be due and payabte, within fifteen (15) days
following Hoku's receipt of a bil. Payment will be made by electronic transfer of funds.
Idaho Power wiJl provide Hoku with current ABA routing numbers and other necesary
instructons to faciltate the electronic transfer of funds. .
. SECtION 10 - ACCESS TO PREMISES
10.. During. the term of this Agreement, and for a reasonable period
following termination, Idaho Power shall have acces to the Hoku Facilty premises at all
times for the purposes of reading meters;. making installations, repairing end removing
Interconnection Facilites and Idaho Power equipment and for other: proper purpses
hereunder.________..__..._______NO_._____ -------. --_._------_.
SECTION 11 - ASSIGNMENT
. 11.1 This Agreement shall be binding upon the heirs, legal and
personal representatives, successors and assigns of the parties hereto.
SECTION 12 - LIAILITY
12.1 Each party agrees to protect, defend, indemnify and. hold
harmless the other part, its offcers', directors, and employees against and from any al'd ~ .
all liabilty, suits; loss, damage, claims, actions, costs, and expenses of any nature,
including court. costs and attorney's fees, even if such suits or Claims are ~mpletely
groundless, as a result of injury to or death of any person or destrction, loss or damage
to propert arising in any way in connecton wih, or related to, this Agreement, but ònly
to the extent such injury to or death of any person or destruction,' loss or damage to
propert is not due to the negligence or other breach of legal duty of sucli other part;
provided; however, that each party shall be solely responsible for claims of and payment
. to its employees for injuries occurrng in connection with their employment or arising ou
of any workman's compensation law.
12.2 . Limittion of Liability: Neither part shall, in any event, be liable to'
the other for any spectal, incidental, exemplary, punitie or conseuential damages such
as, but not limited to, lost profits, revenue or goo wil, or interest, whether such loss is
based on contrct, warranty, negligence, strict liabilty or otherwse.
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SECTION 13 - MODIFICATIONS OF CONTRCT
13.1 This Agreement may not be modifed except by wrng, duly
signed by both parties hereto.
SECTION 14. COMMISSION JURISDICTION
14.1 This Agreement and the repective rights and. obligations of the
~artes hereunder, shall be subject to (1) Idaho Power's General Rules al1d Regulations
as now or hereåfter in effect and on file with the Commission and (2) to the jurisdiction
and regulatory authority Of the Commission and the laws of the State of Idaho. ".
, 14.2 W,e terms, conditons, and rates set fort in this Agreenient ånd
Schedule 32 are subject to the continuing jurisdiction of the Commission:l The rateS .
under this Agreement are subject to change and revision by order of thet19mmission
upon a finding, supported by substantial competent evidence, that such rate change or
revision is just, fair, reasonable, sufcient, nonpreferential, and nondiscriminatory. It is
the partes' intention by such provision that the rate making standards to be used in
making any revisions or changes in rates, and the judicial review of any revisions or
changes in rate~, wil be the såme standards that are applicable to Idaho intrastate tariffrates. . .
SECTION 15 - COMMISSION APPROVAL
15.1 This Agreement shall become effectve upon the approval by the
Commission of all terms and provisions hereof without chane or condition.
8
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EXHIBIT 1
PAGE80FI0
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IDAHO POWER COMPANY
~: ~d~Id-ét ~~bf¿/Yr AMiV5
HQKU MATERIALS, INC.
BY
ITS
9
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PAGE90Fl0
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IDAHO PO~ER COMPAN
BY
ITSHO~
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9
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