20110407Sanderson Affidavit.pdf

Peter J. Richardson (ISB No. 3195)
Gregory M. Adams (ISB No: 7454)
Richardson & O'Lear, PLLC
515 N. 27th Street
Boise, Idaho 83702
Telephone: [phone]
Fax: [phone]
peter(ßrichardsonandolear.com
greg(ßrichardsonandolear.com
RECEIVED
.201 l APR -7 PM~:' 9
Attorneys for Western Desert Energy, LLC
BEFORE THE IDAHO
PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE ) CASE NO. IPC-E-ll-Ol
APPLICATION OF IDAHO POWER )
COMPANY FOR A DETERMINATION ) AFFIDAVIT OF ROWE SANDERSON
REGARDING A FIRM ENERGY SALES ) IN SUPPORT OF APPROVAL OF
AGREEMENT WITH WESTERN DESERT ) THE ENERGY SALES AGREEMENT
ENERGY, LLC FOR THE SALE AND )
PURCHASE OF ELECTRIC ENERGY )
)
I, Rowe Sanderson, do declare the following and if called to testify, would and
could competently testify thereto:
1. I am over the age of 18, and I am employed by the Western Desert
Energy, LLC, which is an Oregon limited liabilty company registered to conduct
business in the State of Idaho. I generally use the name "Sandy" Sanderson, and that
name appears in much of my correspondences related to this matter.
2. I have been directly involved in the development efforts for Western
Desert Energy, LLC's 5 megawatt ("MW") wind far on the Staord Ranch in Owyhee
County, Idaho.
3. I have personal knowledge of the matters set forth herein from my
involvement in developing the Western Desert Energy wind project (or "the Project"),
including the efforts to secure real propert rights, study the wind resource, obtain
necessar governent permits, proceed through the interconnection and transmission
processes, and execute the Firm Energy Sales Agreement ("FESA").
General Project Development Background
4. Western Desert Energy has planed a 5 MW wind project that wil use
three 1.6 MW turbines in Idaho Power's service territory in Owyhee County, and will sell
its output to Idaho Power as a qualifying facility under the Public Utilities Regulatory
Policies Act of 1978 ("PURP A").
5. The developers ofthe Project signed the land lease to develop a wind farm
on the Staford Ranch, effective October 7, 2009, and Western Desert Energy, LLC stil
possesses the rights there under.
6. The Project developers expended considerable time researching wind
fars and originally considered developing a larger wind far.
7. In December 2009, the Project's developers decided to develop a 5 MW
project because Idaho Power stated that the transmission line crossing the property could
handle a project of that size.
8. The Project's developers obtained a conditional use permit from Owyhee
County in October 2010.
9. Thus far, the Project's developers have spent approximately $105,000 on
the land lease, meteorological tower and equipment, interconnection studies, engineering
work, and other development costs.
AFFIDAVIT OF ROWE SANDERSON
PAGE 2
Efforts to Secure an Interconnection Agreement
10. Western Desert Energy completed an Idaho Power Small Generator
Interconnection Request for the 5 MW wind project on March 2, 2010, and Idaho Power
received the Request on March 9, 2010.
11. Western Desert Energy requested to interconnect 5 MW of wind output to
a 69 kilovolt line that rus near the Staford Ranch.
12. On May 10, 2010, Western Desert Energy and Idaho Power entered into a
Feasibilty Study Agreement.
13. On July 9, 2010, Idaho Power completed the Final Feasibilty Study
Report, and on August 9, 2010, Idaho Power provided Western Desert Energy with the
study and a Facility Study Agreement.
14. The Feasibility Study concluded that the existing transmission system is
capable of integrating the 5 MW Project at the proposed point of interconnection with a
proposed online date in sumer 2012, and that a System Impact Study was unecessar.
15. The cover letter sent on August 9, 2010 stated that Western Desert Energy
must execute the Facility Study Agreement and submit a deposit of $30,000 by
September 21,2010, or else the application for interconnection would be withdrawn.
16. Western Desert Energy executed the Facility Study Agreement and
provided the $30,000 deposit on September 21, 2010. In this Agreement, Western Desert
Energy set dates for commencing constrction on April 15, 2012, and full commercial
operation on October 31,2012.
17. On October 22, 2010, Idaho Power's transmission personnel sent a letter
confirming that the Facility Study Agreement was complete, and projecting to have a
AFFIDAVIT OF ROWE SANDERSON
PAGE 3
completed Facility Study by December 29,2010.
18. On Januar 24, 2011, Idaho Power provided Western Desert Energy with
a letter and the Draft Facility Study Report.
19. The Januar 24, 2011 letter requested comments so that the paries could
execute a Generator Interconnection Agreement and proceed with final design and
construction. We are curently awaiting Commission determination on approval of the
Firm Energy Sales Agreement containing the published avoided cost rates prior to
committing fuher resources to the final interconnection process.
Contacts with Idaho Power's PURP A Contracts Administrators
20. Idaho Power's transmission personnel had informed Western Desert
Energy at various times throughout the interconnection process that in addition to
securing interconnection rights through the transmission personnel, we would have to
secure transmission rights to the load center and a power sales contract.
22. We were told that Idaho Power's power supply merchant group would
handle those aspects of the Project.
23. I was in touch with Randy Allphin as early as March 2010 because he is
the person the transmission personnel instructed me to contact to secure transmission
rights and a power sales contract.
24. I emailed Mr. Allphin on March 8, 2010, requesting information to
determine how much transmission was available at that time, and what kind of
improvements would be necessar to secure transmission for the Project. I attached our
Small Generator Interconnection Agreement to my March 8, 2010 emaiL.
25. In addition, Mr. Allphin was copied with correspondences between
AFFIDAVIT OF ROWE SANDERSON
PAGE 4
Western Desert Energy and Idaho Power's transmission deparment personnel handling
the interconnection requests, including Idaho Power's March 17,2010 letter sending the
Project the Feasibilty Study Agreement, and Idaho Power's letter on October 22, 2010
sending the Project the fully executed Facility Study Agreement.
26. On August 15, 2010, I emailed Mr. Allphin and stated, "this a request to
begin the study process for the delivery of energy to Idaho Power (Transmission Capacity
Study) for Western Desert Energy, LLC 5 MW (GI-318) wind turbine project and a
PURP A Power Purchase Agreement from Idaho Power for the 5 MW proposed wind
tubine far in Owyhee County."
27. I attched the Final Feasibilty Study to this August 15,2010 email to Mr.
Allphin.
28. On September 28, 2010, Idaho Power's PURPA contracts deparment
delivered a letter of understanding to Western Desert Energy.
29. The September 28, 2010 letter of understanding stated that before Idaho
Power would execute a FESA, Western Desert Energy must have received an
Interconnection Feasibility Study with acceptable results, must have provided Idaho
Power with the necessary information to request transmission capacity on its own system,
and must receive acceptable results from an initial transmission request.
30. As described above, we had already completed the Interconnection
Feasibility Study and provided it to Mr. Allphin on August 15,2010.
31. We had also already requested that Mr. Allphin begin the formal
transmission request process on March 2, 2010, and on August 15,2010, and we assumed
that Mr. Allphin would commence that process with information provided to him.
AFFIDAVIT OF ROWE SANDERSON
PAGE 5
32. Through the fall of 2010, I was in contact with Mr. Allphi regarding our
Project and our efforts to secure a FESA.
33. Western Desert Energy executed Idaho Power's letter of understading on
November 9,2010, and retued it to Idaho Power.
34. We leared that, prior to Idaho Power beginning the transmission study,
Idaho Power wanted us to complete a form titled "Transmission Capacity Application
Questionnaire," in addition to the information already provided.
35. We completed the Transmission Capacity Application Questionnaire and
Idaho Power received it on December 13,2010.
36. Around this time, I learned that Idaho Power had fied a petition on
November 5, 2010, to lower the eligibility cap for published avoided cost rates to 100
kilowatts, well below our project size. Nobody from Idaho Power had informed us of
this filing during our communcations throughout the falL.
37. All of our efforts to date had been based on the presumption that the
published avoided cost rates would be available to our Project, and we were surrised to
lear that Idaho Power had fied a request to make those rates unavailable to projects like
ours.
38. We decided to retain a law firm in mid-December 2010 to assist us in
securing the power sales contract.
39. On Janua 3, 2011, Idaho Power sent a letter, confirming that the
transmission capacity was available to deliver the Project's output to Idaho Power's load
center, and that no fuher transmission studies were necessar.
40. With the Januar 3, 2011 letter, Idaho Power provided a draft FESA for
AFFIDAVIT OF ROWE SANDERSON
PAGE 6
the very first time since Western Desert Energy had first contacted it almost a year
previously, regarding our 5 MW project.
41. In this Januar 3, 2011 letter, Idaho Power also notified Western Desert
Energy for the first time that it had fied a joint petition to lower the eligibilty cap for
published avoided cost rates on November 5, 2010, and that this fiing may impact the
Project's right to published rates.
42. We completed the project-specific information in the standard PURPA
FESA provided by Idaho Power, and requested that Idaho Power provide execution ready
copies.
43. After receiving execution-ready copies of the FESA, a managing member
of Western Desert Energy, LLC, Michael Chase, executed final copies of the FE SA on
Januar 22, 2011, and delivered them to Idaho Power.
44. Idaho Power executed the FESA on Januar 28, 2010, and filed it for
Commission determination on February 2,2011.
45. Western Desert Energy would have executed a FESA months earlier if we
had understood the steps necessar to obtain a final FESA when we first contacted Idaho
Power's PURPA contracts administration deparent and if we had understood that
Idaho Power would request that the Public Utilities Commission lower the eligibility cap
for published avoided cost rates.
AFFIDAVIT OF ROWE SANDERSON
PAGE 7
I declare under penalty of perjur under the laws of the United States and under laws of
the state of Idaho that the foregoing is tre and correct.
DAlED ths t4 day of April 2011.
AFFIDAVIT OF ROWE SANDERSON
PAGE 8
By
STATE OF IDAHO )
) ss.
)COUNTY OF ADA
On this ~-J day of April 2011, before me, a Notar Public in and for the
State of Idaho, personally appeared Rowe Sanderson, personally known to me (or proved
to me on the basis of satisfactory evidence) to be the person who executed this instrent
and acknowledged it to be his free and voluntar act and deed for the uses and puroses
mentioned in the instrent.
IN WITNESS WHEREOF, I have hereunto set my hand and official seal the day
and year first above written.
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NOTARY PUBLIC for the State ofIdaho
Residing at ~ lS ) (D , c¡ -: 702-
My Commission expires
3-l?l - 15
AFFIDAVIT OF ROWE SANDERSON
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