20140514Petition.pdf

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DONOVAN E. WALKER
Lead Counsel tohr
May 13,2014
VIA HAND DELIVERY
Jean D. Jewell, Secretary
ldaho Public Utilities Commission
472 West Washington Street
Boise, ldaho 83702
Re: Case No. IPC-E-14-09
Suspend Obligation to Purchase Energy Generated by Solar-Powered
Qualifying Facilities - ldaho Power Company's Petition and Testimony
Dear Ms. Jewell:
Enclosed for filing in the above matter please find an origina! and seven (7)
copies of ldaho Power Company's Petition.
Also enclosed for filing are nine (9) copies each of the Direct Testimony of Randy
Allphin and Philip B. DeVol. One copy of each of the aforementioned testimonies has
been designated as the "Reporter's Copy." ln addition, a disk containing a Word
version of Mr. Allphin's and Mr. DeVol's testimonies is enclosed for the Reporter.
Enclosed in a separate envelope are nine (9) copies of confidential Exhibit No.
1 to Mr. Allphin's testimony. A proposed Protective Agreement is provided for execution
by the appropriate ldaho Public Utilities Commission Staff attorney. Please handle the
confidential information in accordance with the Protective Agreement ldaho Power
Company requests be executed in this matter. A non-confidential version of Exhibit No.
1 was filed with the Direct Testimony of Randy Allphin. The confidential version of
Exhibit No. 1 is provided separately.
lf you have any questions about the enclosed documents, please do not hesitate
to contact me.
An IDACORP Company
DEW:csb
Enclosures
1221 W. ldaho St. (83702)
PO. Box 70
Boise, lD 83707
Very tryly yours,
'ff^"{.vrrir".
DONOVAN E. WALKER (lSB No. 5921)
ldaho Power Company
1221West ldaho Street (83702\
P.O. Box 70
Boise, ldaho 83707
Telephone: [phone]
Facsimile: [phone]
dwal ker@ idahopower. com
Attorney for ldaho Power Company
IN THE MATTER OF IDAHO POWER
COMPANY'S PETITION TO
TEMPORARILY SUSPEND ITS PURPA
OBLIGATION TO PURCHASE ENERGY
GENERATED BY SOLAR.POWERED
QUALTFYTNG FAC|L|TIES ("QF',).
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BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
CASE NO. !PC-E-14-09
IDAHO POWER COMPANY'S
PETITION TO TEMPORARILY
SUSPEND ITS PURPA
OBLIGATION TO PURCHASE
ENERGY GENEMTED BY
SOLAR-POWERED QFS
ldaho Power Company ("ldaho Powe/' or "Compo[y"), pursuant to RP 53, 56,
and 256, hereby respectfully petitions the ldaho Public Utilities Commission
("Commission") to immediately issue an order temporarily suspending ldaho Powe/s
obligation, under SS 201 and210 of the Public Utility Regulatory Policies Act of 1978
(.PURPA") and various Commission orders, to enter into contracts and/or obligations to
purchase energy generated by qualifying solar-powered small power production
Qualifying Facilities ("QF" or "Qualifying Facilities"). Alternatively, ldaho Power seeks
an immediate order from the Commission determining that any solar PURPA contracts
IDAHO POWER COMPANY'S PETITION TO TEMPORARILY SUSPEND ITS PURPA
OBLIGATION TO PURCHASE ENERGY GENERATED BY SOLAR.POWERED QFS. 1
or obligations entered into with ldaho Power shall contain an appropriate solar
integration charge. ldaho Power's request for a temporary suspension of its PURPA
purchase obligation is limited to contracts/obligations for purchases of energy from
solar-powered QFs. The suspension would not affect contracts with QFs utilizing other
generating tech nolog ies.
Idaho Power requests that this temporary suspension remain in effect for a
period of time sufficient to allow completion of ldaho Power's current solar integration
cost study and to include the results thereof into the purchase agreements with solar
QFs. ldaho Power currently has 501 megawatts ("MW") of solar QFs that have recently
signed contracts, received draft contracts, received indicative incremental Integrated
Resource Plan ("lRP") cost pricing calculations, or othenruise made serious inquiries
about selling their generation to ldaho Power and/or obligating ldaho Power and
customers to such purchases pursuant to PURPA. The temporary suspension is
necessary to prevent great and irreparable harm to ldaho Power's customers that will
result from entering into purchase agreements/obligations with solar QFs without the
inclusion of solar integration costs. Numerous solar QFs are seeking purchase
agreements/obligations with ldaho Power prior to completion of the current on-going
solar integration study anticipated for June of this year. This Petition is supported by
the accompanying testimony and exhibits of Randy Allphin and Philip B. DeVol and is
based on the following:
I. BACKGROUND
1. PURPA . Sections 2O1 and 210 of PURPA require electric utilities to offer
to purchase electric energy from qualifying cogeneration and small power production
IDAHO POWER COMPANY'S PETITION TO TEMPORARILY SUSPEND ITS PURPA
OBLIGATION TO PURCHASE ENERGY GENEMTED BY SOLAR.POWERED OFS - 2
facilities.l PURPA further specifies that the purchase rates set by state commissions for
electric utility purchases of energy generated by QFs may not exceed the incremental
cost to the etectric utility of alternative electric energy.2 PURPA defines incremental
cost as the cost to the electric utility of the electric energy which, but for the purchase
from such QFs, such utility would generate or purchase from another source.3 PURPA
also requires state commissions to set the rates for purchases of power from QFs at
levels that are just and reasonable to the utility's customers and in the public interest
and that do not discriminate against QFs, but that are not more than avoided costs.a
2. Commission's Authoritv to Temporarilv Suspend Oblioation. The
Commission has authorized a temporary suspension of the PURPA purchase obligation
in the past. ln Order No. 19348 issued in Case No. U-1500-156, the Commission, on its
own motion, imposed a one-year moratorium on purchases from QFs located within the
service areas of non-investor-owned utilities that purchase energy supplies from the
Bonneville Power Administration. That moratorium was eventually lifted and ldaho
Power continues to be the purchaser of considerable amounts of energy from QF
projects located in the service areas of ldaho municipalities and co-ops. Additionally,
and more recently, the Public Utility Commission of Oregon temporarily suspended
ldaho Powefs obligation to enter into standard purchase agreements/obligations until
such time as ldaho Powe/s avoided cost rates could be updated. Order No. 12-042,
Case Nos. UE 244 and UM 1575. Likewise, the California Public Utilities Commission
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IDAHO POWER COMPANY'S PETITION TO TEMPORARILY SUSPEND ITS PURPA
OBLIGATION TO PURCHASE ENERGY GENERATED BY SOLAR-POWERED QFS - 3
has similar[ issued a temporary suspension of PURPA obligations for the protection of
customers, citing to its "obligation to ensure that rates for utility purchases are just and
reasonable and in the public interest." 2013 WL 458041 (Cal.P.U.C.) Re
lmplementation and Administration of California Renewables Portfolio Standard
Program, Rulemaking Proceeding 11-05-005, Decision 13-01-041, p. 16, Jan.24,2013.
Prior history clearly demonstrates that when a utility asks the Commission to
consider changing avoided cost rates, or implementing policy change, potential
developers inundate the utility with contract and interconnection requests seeking to
obligate the Company and its customers prior to the change(s) taking effect; i.e.,
seeking "grandfathered" status. The Company, in conjunction with the selected
Technical Review Committee and Commission Staff from both ldaho and Oregon,
commenced a solar integration study in August of 2013. DeVol Testimony, p. 3. ln
order to allow that study to be completed and implemented into solar QF purchase
obligations, it is imperative that the Commission implement a temporary suspension of
the Company's obligation to purchase generation from solar QF resources. Unless the
Commission orders a temporary suspension of the mandatory purchase obligation
under PURPA, ldaho Power is concerned that solar QF developers will inundate ldaho
Power with requests for contracts and file complaints, meritorious or otherwise, in order
to position themselves for an entitlement to be "grandfathered" to the existing published
avoided cost rates without inclusion of a solar integration charge. This potentially puts
the Commission in the position of accepting or rejecting PURPA solar purchase
obligations that do not contain a solar integration charge.
IDAHO POWER COMPANY'S PETITION TO TEMPORARILY SUSPEND ITS PURPA
OBLIGATION TO PURCHASE ENERGY GENERATED BY SOLAR-POWERED QFS - 4
The Commission has the obligation to ensure that the avoided cost rate is just
and reasonable to the utility's customers, in the public interest, and that customers are
not harmed by the PURPA QF obligation. lnherent in that authority is the ability to
temporarily suspend the Company's obligation to purchase, until the current solar
integration study can be completed and establish a proper integration charge for those
purchase obligations. The ldaho Supreme Court recently upheld the Commission's
authority and procedure by which it approves or disapproves of PURPA power sales
agreements, and determines whether a legally enforceable obligation exists that would
bind the QF, utility, and its customers even in the absence of a contract. ldaho Power
Co., v. ldaho Pub. Utiil. Comm., 155 ldaho 780, 316 P.3d 1278 (Grouse Creek').
Certainly within the Commission's obligation to protect customers, its authority to
approve or disapprove QF sales agreements, as well as its authority to determine if the
QF has incurred a legally enforceable obligation outside of a contract, is its ability to
determine whether or not it will allow contracts or obligations to purchase solar QF
generation with, or without, the associated integration costs included.
3. The GNR PURPA Cases. The Commission issued its fina! order in Case
No. GNR-E-11-03 on December 18, 2012. This concluded phase three of the
Commission's multi-year, three-phase investigation into PURPA pricing, contracting,
disaggregation, etc.s The Commission made changes to the methodologies utilized to
estimate the utilities avoided cost for long-term, contractual purchases with QFs. For
solar QFs, the Commission directed that avoided cost rates for all solar QFs above 100
kilowatts utilize the incremental cost lRP methodology.
u Case No. GNR-E-10-04, Phase 1;Case No. GNR-E-11-01, Phase 2; Case No. GNR-E-11-03,
Phase 3.
IDAHO POWER COMPANY'S PETITION TO TEMPORARILY SUSPEND ITS PURPA
OBLIGATION TO PURCHASE ENERGY GENERATED BY SOLAR-POWERED QFS.5
Solar QFs receive an avoided cost price that is much higher than other QF
resources, particularly the other intermittent resource (wind) because a solar QF's
generation profile is a much better match to the Company's need to serve load. This
case is not about the incremental cost IRP methodology and the resulting higher
avoided cost rates that a solar QF receives from that methodology. The Company
believes that this pricing is reflective of a higher value to the Company and its
customers of solar generation, and the fact that it is a better match for the Company's
loads. However, unlike wind, which is the other predominant intermittent resource,
studies and data regarding the integration costs of solar have been lacking in the past.
Order No. 32068, p. 5. Consequently, although the Commission and Commission Staff
have acknowledged that solar is an intermittent resource with some associated
integration cost to the utility and its customers, because of the lack of solar integration
studies and data, a solar integration charge has not yet been implemented. Order No.
32068, p. 5; Staff Comments, Case No. IPC-E-10-19, pp. 5-6; Staff Comments, Case
No. IPC-E-11-10, pp. 8-9. Without inclusion of the associated cost of integrating solar
generation onto ldaho Power's system, ldaho Powe/s customers will be irreparably
harmed by paying solar QFs a price that is above the avoided cost of the Company, and
will not be held neutral in the QF transaction as required by PURPA.
4. ldaho Power's Previous Solar PURPA Contracts. ldaho Power currently
has no ldaho contracts with solar QFs. However, the Commission previously approved
two solar QF PURPA contracts with Idaho Power: Grand View Solar PV One, LLC,
Case No. IPC-E-10-19, and lnterconnect Solar Development, LLC, Case No. IPC-E-11-
10. Both of these contracts were terminated subsequent to Commission approval for
IDAHO POWER COMPANY'S PETITION TO TEMPORARILY SUSPEND ITS PURPA
OBLIGATION TO PURCHASE ENERGY GENERATED BY SOLAR.POWERED QFS.6
failure to meet the Scheduled Operation Date in one case and failure to post the
required security deposit in the other. Although neither previous solar contract
contained a solar integration charge, the Commission recognized that solar generation
was intermittent in nature causing integration costs. Commission Staff recommended
that a solar integration charge was appropriate, and in the case of lnterconnect Solar,
Staff recommended implementing a solar integration charge equal to the wind
integration charge.
Commission Staff, in the case of Grand View One, recommended that solar as
an intermittent resource "undoubtedly" incurred integration costs upon the utility and its
customers. Staff Comments, pp. 5-6, Case No. IPC-E-10-19. Staff recommended,
however, that because of the lack of data and analysis necessary to quantify solar
integration costs, that a specific integration cost not be included for Grand View One.
/d., p. 6. Staff also recommended that when ldaho Power eventually has the data and
analysis to support a solar integration charge, that those charges be included in PURPA
contracts. /d. The Commission in approving the Grand View Solar One contract stated:
While approval of the Agreement is opposed by one of the
Company's customers, we note that solar is a qualifying
renewable energy resource under PURPA that ldaho Power
is required to purchase. As does Staff, the customer notes
the intermittent nature of the resource and the necessity for
the Company to provide backup. We acknowledge this
aspect of solar generation contracts but agree with Staff
that insufficient data exists to calculate an integration
adjustment.
Order No. 32068, p. 5 (emphasis added).
IDAHO POWER COMPANY'S PETITION TO TEMPOMRILY SUSPEND ITS PURPA
OBLIGATION TO PURCHASE ENERGY GENEMTED BY SOLAR-POWERED QFS.7
Commission Staff, in the case of lnterconnect Solar, recommended that the
Commission implement a solar integration charge for lnterconnect Solar equal to $6.50,
the same as that included for intermittent wind resources.
Staff believes that solar integration costs are material, and
may be comparable to wind integration costs. Some
articles suggest that the integration cost for solar integration
may be less than the calculated wind integration cost, yet
other articles suggest that solar energy is even more difficult
and costly to integrate than wind due to the more frequent,
sudden deviations in solar generation (i.e., clouds). The
Commission has approved only one other PURPA contract
for a solar facility. ln that contract, no discount to account for
solar integration cost was included because of lack of data
and studies. Staff was hopeful that data could be gathered
from the Grand View I project and that ldaho Power could
complete a solar integration study before additional solar
projects were proposed. Unfortunately, that clearly has not
happened. !n any case, Staff is convinced that integration
costs associated with the lnterconnect Solar Facility will not
be zero. Based on prior studies of wind integration costs,
the Commission conservatively capped integration costs at
$6.50 per MWh. Staff believes that absent additional
information, the same $6.50 per MWh integration cost is a
better estimate than no integration cost at all, and should be
applied as a discount to the avoided cost rates in the
Agreement.
Staff Comments, Case No. IPC-E-11-10, pp. 8-9. The Commission, however,
subsequently approved the lnterconnect Solar contract without including solar
integration costs. Order No. 32384.
II. REQUEST FOR EXPEDITED AND IMMEDIATE RELIEF TO
PREVENT IRREPERABLE HARM TO CUSTOMERS
ldaho Power currently has 501 MW of solar QF projects poised to contract
with/obligate the Company to purchase the output of their various projects pursuant to
PURPA. Allphin Testimony, p.3, Allphin Exhibit No 1. Of this 501 MW, 15 projectsfor
341 MW are located within ldaho with the remaining 16 projects for 160 MW being in
IDAHO POWER COMPANY'S PETITION TO TEMPORARILY SUSPEND ITS PURPA
OBLIGATION TO PURCHASE ENERGY GENERATED BY SOLAR-POWERED QFS - 8
Oregon. ld. Currently, none of these contracts and potential contracts/obligations
contain any solar integration costs, and thus customers will pay much more than the
Company's avoided cost for this QF output if contracts/obligations are obtained or
incurred by these solar QFs. Allphin Testimony, p. 3. At current avoided cost rates
applicable in each jurisdiction, this 501 MW represents a cost of approximately $1.89
billion to ldaho Power customers over the life of those contracts. ld., p 4. Although the
solar integration study has not yet identified a cost, assuming a cost equal to that of
wind integration at $6.50, the potential integration costs associated with the 501 MW of
solar is approximately $146 million. ld. The proposed solar QF projects represent2l3
of all of ldaho Power's existing PURPA QF contract costs/obligations incurred to date.
ld. They also constitute an increase in the total nameplate rating of ldaho Powe/s QF
projects from 883 MW to nearly 1,400 MW. ld. ldaho Power's minimum load on its
entire system for 2013 was 1,005 MW. /d.
The Federal Energy Regulatory Commission's ("FERC') view with regard to
inclusion of such costs was clarified in a recent Idaho Power case. ldaho Wind Partners
1, LLC., Docket No. EL12-74-000, 140 FERC 11 61.219 (September 20, 2012)(Order
Granting Petition for Declaratory Order); EL12-74-001, 143 FERC 11 61,248 (June 20,
2013) (Order on Rehearing). ln the ldaho Wind Partners case, FERC insisted that all
long-term PURPA contracts containing rates established at the time of contracting will
be assumed to include all costs, even in the face of direct evidence that certain costs
were not included in the avoided cost rates at the time of contracting. Order on
Rehearing, supra. Additionally, FERC's position is that once avoided cost rates are
IDAHO POWER COMPANY'S PETITION TO TEMPORARILY SUSPEND ITS PURPA
OBLIGATION TO PURCHASE ENERGY GENERATED BY SOLAR-POWERED QFS - 9
established in the contract at the time of contracting, that they cannot subsequently be
changed. /d.
The 501 MW of solar QF projects are real and imminent. Allphin Testimony, pp.
4-5. In Oregon, one developer has proposed a total of 16 different solar QF projects, all
at 10 MW each in order to obtain Oregon standard contract rates. ld., p. 5. Of these
160 MW of proposed projects in Oregon, ldaho Power has recently executed 6
contracts at 10 MW of nameplate capacity each, none of which contain solar integration
costs. /d.
!n its ldaho jurisdiction, the Company has 341 MW of inquiries from 6 developers
representing 15 different solar QF projects. ld. ldaho Power has provided indicative
incremental cost IRP pricing to six separate solar QF projects, consisting of five 20 MW
projects and one 40 MW project for a total of 140 MW. ld. Four of these projects have
requested and received draft contracts from ldaho Power and are in active
discussions/negotiations about contract terms and conditions. ld. One developer is
seeking contracts for a 40 MW and two 20 MW solar QF projects to be located on land
under the control of three large Idaho municipalities. /d. The most recent inquiry is from
a developer that over the years has proposed various QF projects and has enlisted the
aid of a successful wind developer in developing four, 30 MW solar projects and is
seeking contracts/obligations with ldaho Power. /d., pp. 5-6. Another developer is a
large out-of-state wind developer that is now proposing a 20 MW solar QF project on
the site of a formerly proposed wind QF. ld., p.6. At least five other 20 MW each solar
QF projects are represented by experienced ldaho legal counsel that has represented
numerous QF projects of all generation types over the course of many years. /d. These
IDAHO POWER COMPANY'S PETITION TO TEMPORARILY SUSPEND ITS PURPA
OBLIGATION TO PURCHASE ENERGY GENERATED BY SOLAR-POWERED QFS - 1O
projects, while this Petition was being drafted, took an outdated draft contract from a
different solar QF project, reproduced it five times, and signed the non-final, non-agreed
to, and superseded document and delivered it to Idaho Power on May 12,2014. ld.
Along with its submission, these five QFs included a cover letter purporting to establish
legally enforceable obligations by such actions. /d.
Some of these solar QF developers and representatives have attended a
workshop and participated in ldaho Power's solar integration study process. DeVol
Testimony, p. 9, DeVol Exhibit No. 2. lt is believed that all of the solar QF developers
are well aware of the status and progress of ldaho Power's solar integration study-
including the fact that the Company anticipates final results from the solar integration
study in the near future, as early as next month ln mid-June. Allphin Testimony, pp. 7-8.
Activity, inquiries, and communications from proposed solar QF projects have recently
increased substantially following ldaho Power's May 1 , 2014, solar integration public
workshop. ld., p. 7. The Company believes that all of these developers are actively
seeking contracts/obligations with the Company prior to such time as the solar
integration study is completed. /d., p. 8.
On Monday, May 12, 2004, the "run-onthe-bank" was confirmed. /d., p 6. At
approximately 3:00 p.m. ldaho Power sent e-mail correspondence along with updated
and superseding draft contracts containing a solar integration charge to the four solar
QF projects who had previously received draft contracts. ld., pp.6-7. Just minutes
later, at approximately 3:05 p.m., as mentioned above, ldaho Power took delivery of a
duplicated draft contract, duplicated from a previously provided contract for a different
solar QF project, for five proposed 20 MW solar QF projects, signed by the QF
IDAHO POWER COMPANY'S PETITION TO TEMPORARILY SUSPEND ITS PURPA
OBLIGATION TO PURCHASE ENERGY GENERATED BY SOLAR-POWERED QFS - 11
purporting to be a legally enforceable obligation binding customers. ld., p.7. This is the
same kind of situation that has happened in the past, where a QF developer will obtain
a non-final, non-agreed to draft sales agreement- sign it and deliver it to ldaho Power,
attempting to bolster its claim of entitlement to something that it is not entitled to.
ldaho Power and the Commission are well aware of other similar historical
circumstances and "run-on-the-bank" times when there has been a very substantial
influx of proposed QF projects in a very short period of time, typically seeking a more
favorable rate or other such determination in times of potential rate, rule, and policy
changes that the Commission may implement. The gain sought by the QF developers
is at the direct and substantial detriment to Idaho Power customers. The circumstances
that presently exist with regard to the 501 MW of proposed solar QF projects that are
poised to seek contracts/obligations with ldaho Power, are extremely similar to the
circumstances that were present when ldaho Power previously came to the
Commission seeking relief from an onslaught of proposed wind projects in June of
2005, Case No. IPC-E-05-22, and again in November of 2010, Case No. GNR-E-10-04.
History is repeating itself, and ldaho Power once again is before the Commission
seeking relief on behalf of its customers from locking in rates that exceed the
Company's avoided costs for the next 20 years, doing irreparable harm to ldaho Power
customers in violation of PURPA.
III. SOLAR INTEGRATION STUDY
ldaho Power is currently engaged in a solar integration study ("Study"). A
Technical Review Committee ("TRC") was formed during the summer of 2013 and the
Study kickoff was on August 15,2013, the first TRC meeting. DeVol Testimony, p. 3.
IDAHO POWER COMPANY'S PETITION TO TEMPORARILY SUSPEND ITS PURPA
OBLIGATION TO PURCHASE ENERGY GENERATED BY SOLAR-POWERED QFS - 12
The TRC is made up of: Brian Johnson, University of ldaho; Jimmy Lindsay,
Renewable Northwest Project; Kurt Myers, ldaho National Laboratory; and Paul Woods,
City of Boise. ld., pp. 3-4. Additionally, representatives from both the ldaho Public
Utilities Commission Staff and the Public Utility Commission or Oregon Staff have
participated throughout and are included in all correspondence and issues that the TRC
is involved with. ld. A public workshop was also held on May 1 ,2014. ld. P.9; DeVol
Exhibit No. 2.
Working in conjunction with the TRC, the Study is guided by two documents. ld.,
p 4. Principles for Technical Review (TRC) lnvolvement in Sfudies of Variable
Generation lntegration into Electrical Power Sysfems was produced by the National
Renewable Energy Laboratory ("NREL") and Utility Variable-generation lntegration
Group ("UVIG"). ld. The second report, The Evolution of Wind Power lntegration
Sfudies: Past, Present, and Future, was authored by five NREL researchers considered
to be at the forefront of the study of renewable integration and was published by the
lnstitute of Electrical and Electronics Engineers ("|EEE"). ld. Even though the report
was written from the perspective of wind integration, the principles remain the same for
solar integration. ld. This report is used as the roadmap for ldaho Powe/s solar
integration study. ld., pp. 4-5. Solar, like wind, is variable and uncertain and
consequently the system of dispatchable resources has to be operated differently in
order to successfully integrate the generation without compromising reliability. /d., p. 5.
The stepsfollowed bythe Study, consistentwith the IEEE report, are: (1) Data
gathering and scenario development; (2) Study analysis-a. statistical-based analysis of
solar characteristics, b. production cost simulation analysis, and c. reliability
IDAHO POWER COMPANY'S PETITION TO TEMPORARILY SUSPEND ITS PURPA
OBLIGATION TO PURCHASE ENERGY GENERATED BY SOLAR-POWERED QFS - 13
assessment; and (3) Study conclusions and results. ld. Idaho Power has walked
through both guiding documents, as wel! as the steps outlined above with the TRC. The
importance of these documents to the study was emphasized to participants at the May
1 public workshop. /d. The TRC has thus far been extensively involved in the first step:
data gathering and scenario development. ld. The TRC has been integrally involved
with the identification of suitable sources of solar production data, as well as
discussions leading to the development of scenarios to be studied. ld. The TRC has a
leading role in advising as to the use of a technique to transform point-source solar data
to meaningfu! production data for a solar farm. /d., pp. 5-6. The technique is called
wavelet variability modeling. /d., p. 6. The TRC's counsel with respect to ldaho
Poweds use of the wavelet technique has been important and needed. ld.
One of the larger tasks of step 1 of the Study, as noted in the IEEE report, is the
undertaking involved with coming up with resource data that is needed to mode! future
power output. ld. ln fact, the Study's biggest hurdle thus far has been obtaining the
solar resource data needed to model solar power output. ld. The solar build-out
scenarios are considering solar farms at six locations in southern ldaho: Parma, Boise,
Grand View, Twin Falls, Picabo, and Aberdeen. /d. The Study was able to obtain solar
data from the U.S. Bureau of Reclamation AgriMet network at the desired five-minute
time step for all locations except Grand View. ld. NREL maps indicate the area
surrounding Grand View and Glenns Ferry has the highest annual solar intensity in the
state. ld. For this reason, ldaho Power and the TRC have felt it's important to model a
solar farm at Grand View. ld. Obtaining five-minute solar data for Grand View has
required the acquisition of data from SolarAnywhere, which is a web-based service from
IDAHO POWER COMPANY'S PETITION TO TEMPORARILY SUSPEND ITS PURPA
OBLIGATION TO PURCHASE ENERGY GENERATED BY SOLAR.POWERED OFS - 14
Clean Power Research providing satellite-derived solar irradiance data. ld., pp.6-7.
The Study did not receive data for Grand View from SolarAnywhere until Apri!, causing
delay in the Study schedule. ld., p.7.
With the acquisition of data for the Grand View atea, the Study is nearing
completion of step 2.a above, statistical-based analysis of solar characteristics. ld.
ldaho Power has had correspondence with the TRC regarding the strategy for
statistical-based analysis of the solar data, and the Study is nearing completion of this
analysis. ld. The results of this analysis have not yet been presented to the TRC. ld.
This analysis will be presented to the TRC for its review in May. ld. The intent of this
analysis is to translate the variability and uncertainty present in the solar data to an
incremental reserve requirement. ld. The NREL authors of the IEEE report describe
this as an analysis to determine the increase in ancillary services required by a given
solar scenario, where NREL defines ancillary services as services that help grid
operators maintain balance on electric power systems. ld. ldaho Power has discussed
with the TRC and workshop participants that the next step is to take the increase in
reserve requirement, or ancillary services, from step 2.a for any given solar scenario
and to input it into the Study's production cost simulations to determine the cost of
carrying increased ancillary services. ld., pp.7-8.
At the August 2013 kickoff of the Study, a tentative completion of quarter 1 2014
was discussed with the TRC. ld., p 8. The most recent communications with the TRC
over the last couple of weeks have been centered around narrowing the focus of the
Study in order to determine integration costs for photovoltaic solar ("solar PV')
resources sufficient to allow ldaho Power to have integration costs necessary for IRP
IDAHO POWER COMPANY'S PETITION TO TEMPORARILY SUSPEND ITS PURPA
OBLIGATION TO PURCHASE ENERGY GENERATED BY SOLAR-POWERED QFS - 15
and PURPA cost assumptions for solar PV resources. ld. Commission Staff has
expressed agreement with this scope. ld. Because of the use of the two guiding
documents and, in particular, the IEEE report as a road map, the required steps
remaining are well understood by the TRC and workshop participants. ld. lt is
anticipated that results could be obtained as early as Mid-June. ld.
rv. coNcLUStoN
ldaho Power currently has 501 MW of solar QFs that have recently signed
contracts, received draft contracts, received incremental cost pricing calculations, or
otherwise made serious inquiries or taken other steps designed to attempt to obligate
ldaho Power and its customers to purchase their generation pursuant to PURPA, and
without a solar integration charge. A temporary suspension is necessary to prevent
irreparable harm to ldaho Powe/s customers that will result from entering into purchase
agreements/obligations with solar QFs without the inclusion of solar integration costs.
Numerous solar QFs are seeking purchase agreements/obligations with ldaho Power
prior to completion of the current on-going solar integration study anticipated for June of
this year. History is repeating itself, and ldaho Power once again is before the
Commission seeking relief on behalf of its customers from locking in rates that exceed
the Company's avoided costs for the next 20 years, doing irreparable harm to ldaho
Power customers in violation of PURPA.
ldaho Power has been, and is conducting, a mature solar integration study
process that heavily involves input from Commission Staff and the TRC. Results of that
Study are imminently due early this summer, and as soon as mid-June. This is
common knowledge to those in the development community, and Idaho Power and its
IDAHO POWER COMPANY'S PETITION TO TEMPOMRILY SUSPEND ITS PURPA
OBLIGATION TO PURCHASE ENERGY GENERATED BY SOLAR-POWERED QFS - 16
customers are now facing a deluge of attempts to secure contracts or obligations prior
to completion of the Study and inclusion of such costs by the Commission into the
avoided cost rates. ldaho Power respectfully asks for immediate Commission action in
order to prevent great and irreparable harm to customers. ldaho Power asks the
Commission to order that it will not be required to enter into solar QF contracts and/or
obligations that do not contain a solar integration cost.
V. PRAYER FOR RELIEF
WHEREFORE, ldaho Power respectfully requests:
1. That the Commission immediately issue its order temporarily suspending
ldaho Power's obligation under SS 201 and 210 of PURPA to enter into
contracts/obligations to purchase energy generated by solar-powered QFs unti! such
time as the solar integration study can be completed and a solar integration charge
incorporated by the Commission; or alternatively
2. That the Commission immediately issue an order that any solar PURPA
contracts or obligations entered into with ldaho Power shall contain an appropriate solar
integration charge.
Respectfully submitted this 13th day of May 2014.
IDAHO POWER COMPANY'S PETITION TO TEMPORARILY SUSPEND ITS PURPA
OBLIGATION TO PURCHASE ENERGY GENERATED BY SOLAR.POWERED QFS - 17
OVAN E. WALKER
Attorney for ldaho Power Company
CERTIFICATE OF SERVICE
! HEREBY CERTIFY that on the 13th day of May 2014 I served a true and correct
copy of IDAHO POWER COMPANY'S PETITION TO TEMPORARILY SUSPEND ITS
PURPA OBLIGATION TO PURCHASE ENERGY GENERATED BY SOLAR.
POWERED QFS upon the following named parties by the method indicated below, and
addressed to the following:
Donald L. Howell, ll
Kristine A. Sasser
Deputy Attorneys General
Idaho Public Utilities Commission
472 West Washington (83702)
P.O. Box 83720
Boise, ldaho 83720-007 4
Peter J. Richardson
RICHARDSON ADAMS, PLLC
515 North 27fr Street
Boise, ldaho 83702
Robert Paul
515 North 27th Street
Boise, ldaho 83702
Mark VanGulick
P.O. Box 7354
Boise, ldaho 83701
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kris. sasser@puc. id aho. qov
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IDAHO POWER COMPANY'S PETITION TO TEMPORARILY SUSPEND ITS PURPA
OBLIGATION TO PURCHASE ENERGY GENEMTED BY SOLAR-POWERED QFS - 18
Christa Bearry, Legal Assistant