20151218Amended Settlement Stipulation and Joint Motion.pdf

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An IDACORP Company
DONOVAN E. WALKER
Lead Counsel
dwal ker@ida hopower. com
December 18,2015
VIA HAND DELIVERY
Jean D. Jewell, Secretary
ldaho Public Utilities Commission
472 West Washington Street
Boise, ldaho 83702
Case No. IPC-E-12-18
Hidden Hollow Energy 2, LLC - FirstAmended Settlement Stipulation and
Joint Motion to Approve Settlement Stipulation for Dismissalwith Prejudice
Dear Ms. Jewell:
Enclosed forfiling in the above matterare an originaland seven (7) copies of a First
Amended Seftlement Stipulation and Joint Motion to Approve Settlement Stipulation for
Dismissal with Prejudice.
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Donovan E. Walker
DEW:csb
Enclosures
122'l W. ldaho 5t. (83702)
P.O. Box 70
8oise, lD 83707
HIDDEN HOLLOW ENERGY 2 LLC,
Complainant,
V.
IDAHO POWER COMPANY,
DONOVAN E. WALKER (lSB No. 5921) STEPHEN R. THOMAS (!SB No. 2326)
ldaho Power Company Moffatt, Thomas, Barrett, Rock &
1221West ldaho Street (83702) Fields, Chartered
P.O. Box 70 101 S. Capitol Blvd., 10th Floor
Boise, ldaho 83707 Post Office Box 829
Telephone: [phone] Boise, ldaho 83701
Facsimile: [phone] Telephone (208) [e-mail] Facsimile [phone]
[e-mail]
Attorney for ldaho Power Company
Attorneys for Complainant Z Hi= d -"?,E*E frv. '*'
BEFoRE THE tDAHo puBLtc urLtrES co,Mrssror oY @ ''j' E'- 2' f,6i' qlI
CASE NO. IPC.E.12.18 %. F
FIRST AMENDED SETTLEMENT
STIPULATION AND JOINT MOTION
TO APPROVE SETTLEMENT
STIPULATION FOR DISMISSAL
WITH PREJUDICE
Respondent.
This First Amended Settlement Stipulation ('Amended Settlement Stipulation" or
"Amended Stipulation") is entered into between ldaho Power Company ("ldaho Power"
or "Company") and Hidden Hollow Energy 2 LLC (sometimes referred to in this
Stipulation as "Hidden Hollow"), hereafter jointly referred to as "Parties." This Amended
Stipulation is identical to the original Settlement Stipulation except for the additiona!
language contained in paragraph No. 6 hereto, and the insertion of 'Amended" in
reference to the Settlement Stipulation throughout. Pursuant to RP 66 the Parties ask
the Commission to disregard the original Settlement Stipulation and accept this First
Amended Settlement Stipulation and Joint Motion to Approve Settlement Stipulation for
Dismissal with Prejudice. The Parties hereby agree as follows.
lPc-E-12-18 1
First Amended Joint Settlement and Motion
I. INTRODUCTION AND MOTION
1. The terms and conditions of this Amended Settlement Stipulation are set
forth herein. The Parties agree that this Amended Settlement Stipulation represents a
fair, just, and reasonable compromise of the dispute(s) between the Parties and that this
Amended Settlement Stipulation is in the public interest. The Parties maintain that the
Amended Settlement Stipulation as a whole and its acceptance by the ldaho Public
Utilities Commission ("Commission") represent a reasonable resolution of all issues
between the Parties identified herein. Therefore, the Parties hereby respectfully move
the Commission, in accordance with RP 56 and RP 274-76, for an Order approving the
Amended Settlement Stipulation executed between the Parties and all of its terms and
conditions without material change or condition, and for dismissal of this matter with
prejudice.
II. BACKGROUND
2. On December 8, 2010,ldaho Power and Hidden Hollow entered into a Firm
Energy Sales Agreement ("FESA') pursuant to the terms and conditions of the various
Commission Orders applicable to such agreements pursuant to the Public Utility
Regulatory Policies Act of 1978 ('PURPA"). See IPUC Case No. IPC-E-1044. On
February 11,2011, the Commission issued Order No.32180 approving the FESA. The
Parties selected February 28,2012, as both Hidden Hollow's Scheduled First Energy Date
and Scheduled Operation Date in the FESA. SeeAppendix B to the FESA.
3. On February 7,2012, Hidden Hollow sent a letter to ldaho Power claiming
an event of force majeure had occurred pursuant to the December 2O1O FESA, based
upon its fuel supply of landfill gas and upon issues related to air quality permitting. Hidden
Hollow sent another lefter to ldaho Power on May 16, 2012, claiming an additional,
lPc-E-12-1 8 2
First Amended Joint Settlement and Motion
separate, and distinct event of force majeure related to both Ada County's and ldaho
Power's separate contracts with Dynamis Energy, LLC, for a power generation facility also
utilizing trash from the landfill as its fue! source.
4. On May 3,2012, ldaho Power sent a letter to Hidden Hollow stating that
disruptions in fuel supply did not constitute events of force majeure pursuant to the FESA,
and further stating that Hidden Hollow had missed its Scheduled Operation Date of
February 28,2012, and that Hidden Hollow must commence operations by June 1,2012,
(within 90 days of the Scheduled Operation Date) or it could be in material breach of the
FESA and subject to termination and damages. On June 14,2012, ldaho Power sent a
letter to Hidden Hollow stating that the FESA had been terminated and seeking payment
of the Delay Liquidated Damages provided for in the FESA. ldaho Power subsequently
collected $144,000 in Delay Liquidated Damages from the Delay Damage Security that
Hidden Hollow ?LLC had posted with ldaho Power pursuant to the FESA.
5. On July 13,2012, Hidden Hollow filed a Complaint with the Commission
against ldaho Power requesting that the Commission: (1) "rescind and retract" the
termination of the FESA; (2) require ldaho Power to "return the $144,000 Delay Liquidated
Damages" to Hidden Hollow; and (3) and determine that (a) Hidden Hollow is not in
material breach of the FESA and (b) its two claimed incidents of force majeure are valid
events of force majeure under the FESA.
6. ln consideration of the avoidance of additional protracted and costly
discovery and litigation at the Commission regarding multiple claims of force majeure,
the termination of the contact, collection of liquidated damages, and the other issues
presented in this case - including the passage of time since the relevant events took
place, and as a compromise of the parties positions in this case, the parties believe this
tPc-E-12-18 3
First Amended Joint Settlement and Motion
Amended Stipulation to be a just and reasonable resolution of this matter. Hidden
Hollow remains in litigation with Ada County regarding items related to the issues
presented in this case. This Amended Stipulation is in the public interest because it
conclusively terminates a long term FESA that contains terms and conditions that have
subsequently been found by the Commission to no longer be just and reasonable nor in
the public interest for new Energy Sales Agreements going forward, and terminates a
contract to acquire additional generation at a time when ldaho Power has no need for
any additional generation resources over the next ten years, through 2025. For
example: the Commission no longer requires twenty-year terms for negotiated PURPA
contracts, and has authorized a maximum contract term of two years for projects that
exceed the published rate eligibility cap; and the Commission has abandoned the use
of liquidated damages and moved to an actual damages calculation for delay damages
when a project fails to meet the Scheduled Operation Date in a PURPA contract. Based
upon the settlement discussions of the Parties, as a compromise of the respective
positions of the Parties, and for other consideration as set forth herein, the Parties agree to
the following terms:
III. TERMS OF THE SETTLEMENT STIPULATION
7. The FESA dated December 8, 2010, and approved by the Commission
under Order No. 32180 on February 11,2011, be terminated as of the date this
Amended Stipulation is approved by the Commission.
8. ldaho Power Company shall return to Hidden Hollow Energy 2 LLC the
Delay Liquidated Damages in the amount of $144,000.00 within thirty days of the
Commission's approval of this Amended Settlement Stipulation.
9. The Parties agree that this Amended Stipulation and the disposition of
IPC-E-12-18 4
First Amended Joint Settlement and Motion
these matters is in the public interest and that all of the terms and conditions are fair,
just, and reasonable. Each Party, along with its current and former partners, joint
venturers, representatives, successors, assigns, affiliates, subsidiaries, parents,
divisions, departments, lenders, investors, shareholders, officers, directors, employees,
managers, agents, insurers, and predecessors ("Releasing Parties") fully, finally, and
forever releases, discharges, and covenants not to sue the other Party and its current
and former partners, joint venturers, representatives, successors, assigns, affiliates,
subsidiaries, parents, divisions, departments, investors, lenders, shareholders, officers,
directors, employees, managers, agents, insurers, and predecessors ("Released
Parties") to the broadest extent allowed by law from and for any and all claims, actions,
causes of action, debts, damages, demands, offsets, payments, costs, rights, liabilities,
charges, and expenses, direct or indirect, regardless of the legal or equitable theory on
which they are based, whether known or unknown, liquidated or unliquidated, accrued
or unaccrued, asserted or unasserted, arising from or relating to the Firm Energy Sales
Agreement, and Case Nos. IPC-E-1044 and IPC-E-12-18.
10. All terms and conditions of this Amended Stipulation are subject to approval
by the Commission, and only after such approval, without material change or modification,
has been received shall the Amended Stipulation be valid. The Parties hereby submit this
Amended Stipulation to the Commission and recommend approval in its entirety pursuant
to RP 274-76. The Parties shall support this Amended Settlement Stipulation before the
Commission and shall not appeal a Commission order approving the Amended Stipulation
or an issue resolved by the Amended Stipulation.
11. lf this Amended Settlement Stipulation is challenged by anyone who is not
a Party, then each Party reserves the right to file testimony, cross-examine witnesses,
lPc-E-12-18 5
First Amended Joint Settlement and Motion
and put on such case as they deem appropriate to respond fully to the issues
presented, including the right to raise issues that are incorporated in the settlements
embodied in this Amended Settlement Stipulation. Notwithstanding this reservation of
rights, the Parties agree that they will continue to support the Commission's adoption of
the terms of this Amended Settlement Stipulation.
12. lf the Commission or any reviewing body on appeal rejects any part or al!
of this Amended Settlement Stipulation or imposes any additional material conditions on
approval of this Amended Settlement Stipulation, then each Party reserves the right,
upon written notice to the Commission and the other Party to this proceeding within
fourteen (14) days of the date of such action by the Commission, to withdraw from this
Amended Settlement Stipulation. ln such case, no Party shall be bound or prejudiced
by the terms of this Amended Settlement Stipulation and each Party shall be entitled to
seek reconsideration of the Commission's order, file testimony as it chooses, cross-
examine witnesses, and do all other things necessary to put on such case as it deems
appropriate. ln such case, the Parties immediately will request the prompt reconvening
of a prehearing conference for purposes of establishing a procedural schedule for the
completion of IPUC Case No. IPC-E-12-18, and the Parties agree to cooperate in
development of a schedule that concludes the proceeding on the earliest possible date,
taking into account the needs of the Parties in participating in hearings and preparing
briefs.
13. The Parties agree that this Amended Settlement Stipulation is in the public
interest and that all of its terms and conditions are fair, just, and reasonable.
14. This Amended Settlement Stipulation sets forth the complete
understanding of the Parties, and this Amended Settlement Stipulation includes no
IPC-E-12-18 6
First Amended Joint Settlement and Motion
other promises, understandings, representations, arrangements or agreements
pertaining to the subject matter of this Amended Settlement Stipulation, or any other
subject matter, not expressly contained herein.
15. All terms and conditions of this Amended Settlement Stipulation, including
the obligations of the Parties, are subject to the Commission's approval of this Amended
Settlement Stipulation in accordance with its terms and conditions and upon such
approval being upheld on appeal, if any, by a court of competent jurisdiction. Only after
such approval, without material change or modification, has been received shall the
Amended Settlement Stipulation be valid.
IV. PROCEDURE
16. Pursuant to RP 274, the Commission has discretion to determine the
manner with which it considers a proposed settlement. ln this matter, the Parties have
reached agreement on a final resolution to this case. This Amended Settlement
Stipulation is reasonable and in the public interest. The Parties request that the
Commission approve the Amended Settlement Stipulation without further proceedings.
17. ln the alternative, should the Commission determine that further
proceedings are required to consider the Amended Settlement Stipulation, pursuant to
RP 201, the Parties believe the public interest does not require a hearing to consider
the issues presented by this Motion and request it be processed as expeditiously as
possible by Modified Procedure, without waiving the right to a hearing on the previously
disputed matters in this proceeding should the Commission reject the settlement.
V. REQUESTED RELIEF
!PC-E-12-18 7
First Amended Joint Settlement and Motion
i!
NOW, THEREFORE, the Partbs respectftrlly requestthatthe Commission enter its
Order approving the Amended Settlement Stipulation wiUrout material change or condition,
and dismissing Case No. IPG-E-12-18 withoutturther proceedings.
DATED this 17h day of December 2015.
ldaho Power Company
Fields, Chartered
Aftorneys for Complainant
rPc-E-12-18 8
FirstAmended Joint Settlement and Motion
- Of the Firm
Attomey for ldaho Power Company.
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on this 18th day of December 20151 served a true and
correct copy of the FIRST AMENDED SETTLEMENT STIPULATION AND JOINT
MOTION TO APPROVE SETTLEMENT STIPUIATION FOR DISMISSAL WITH
PREJUDICE upon the following named parties by the method indicated below, and
addressed to the following:
Commission Staff
Donald L. Howell, Il
Deputy Attorney General
ldaho Public Utilities Commission
472 West Washington (83702)
P.O. Box 83720
Boise, ldaho 83720-007 4
Hidden Hollow Energy 2, LLC
Stephen R. Thomas
MOFFATT, THOMAS, BARRETT
ROCK & FIELDS, CHARTERED
101 South Capitol Boulevard, lOth Floor
P.O. Box 829
Boise, Idaho 83701
tPc-E-12-18 I
First Amended Joint Settlement and Motion
X Hand Delivered
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Christa Bearry, Lega!