20140521SRA Comments.pdf

SNAIKE RIVER
ALLIAN CF
IDAHOS NUCLEAR WATCHDOG &CLEAN ENERGY ADVOCATE
—4
F-’—mMay2l,2014 C)
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—oTo:Idaho Public Utilities Commission
From:Ken Miller,Clean Energy Program Director,Snake River Alliance
Re:Snake River Alliance Comments on Idaho Power’s Petition to Temporarily Suspend Its PURPA
Obligation to Purchase Energy Generated By Solar-Powered Qualifying Facilities (QFs),Case No.IPC-E
14-09.
The Snake River Alliance provides these comments in the above-referenced case,IPC-E-14-09,Idaho
Power’s Petition to Temporarily Suspend Its PURPA Obligation to Purchase Energy Generated By Solar-
Powered Qualifying Facilities (QFs),and Commission Order No.33039 setting a May 21,2014,public
hearing and public comment deadline in response to Idaho Power’s petition.
Introduction and Procedure
Idaho Power petitioned the Idaho Public Utilities Commission on May 13,2014,seeking relief for what
Idaho Power describes as a potential deluge of solar power contracts by qualifying facilities (QFs)under
the federal Public Utility Regulatory Policies Act (PURPA).The Commission placed Idaho Power’s petition
on its May 19 decision meeting agenda.During that meeting,the Commission decided to conduct a public
hearing two days later,on May 21,2014,and to receive public comments by the same date.
The Alliance understands the purpose of the May21 public hearing (and written comments)is to
consider “narrow questions”raised by Idaho Power in its petition,including:
-Whether the Commission should immediately issue an order temporarily suspending Idaho
Power’s obligation under PURPA to enter into contracts to purchase energy generated by
qualifying solar-powered QF5;
-Alternatively,whether the Commission should issue an Order directing Idaho Power to include an
appropriate solar integration charge in PURPA contracts with solar QFs.
Order No.33039 further states:“The Commission is interested in testimony regarding whether the
need to suspend solar contract negotiations is immediate;whether expedited relief is truly necessary;
and whether other interim measures are available or appropriate that would allow solar development
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and contract negotiations to continue as Idaho Power’s solar integration study is concluded and
presented to the Commission for review.”The Order further stated that “debate regarding whether
and what type of solar integration charge may be appropriate will occur at a later date in a
subsequent proceeding.”
The Alliance does not believe the Commission should issue an order suspending Idaho Power’s solar
purchase obligations under PURPA.Also,the Alliance is unsure how an “appropriate integration
charge”can be included in solar PURPA contracts until such time that a thorough integration study is
completed.
Respecting the parameters set by the Commission as described above,the Alliance has concerns about
the Petition itself and the process addressing the Petition to date.
Idaho Power’s proclaimed solar QF contract emergency is largely self-inflicted.The Company has
known for at least two Integrated Resource Plan cycles that the day would come when the demand by
solar developers for contracts would collide with the absence of established integration costs that
could be used to negotiate those contracts.Yet it did not begin the solar integration study and analysis
until mid-2013,effectively painting the Company into the corner in which it now finds itself.If there is
a crisis in dealing with solar QF contracts (which have yet to materialize in a form ready for submittal
to the PUC),it was created mostly by Idaho Power and not by those pursuing such contracts.In
addition,as Idaho Power acknowledges in its Petition at P.8,the Commission has already approved
an Idaho Power solar contract without including solar integration costs (IPC-E-11-10).
Idaho Power describes on P.11 of its Petition what it views as a “run on the bank”by solar developers
attempting to secure favorable contracts in advance of completion of the integration study:“On
Monday,May 12,2004,(sic)the ‘run-on-the-bank’was confirmed.At approximately 3:00 p.m.Idaho
Power sent e-mail correspondence along with updated and superseding draft contracts containing a
solar integration charge to the four solar QF projects that had previously received draft contracts.Just
minutes later,at approximately 3:05 p.m.,as mentioned above,Idaho Power took delivery of a
duplicated draft contract,duplicated from a previously provided contract for a different solar QF
project...”Left unsaid is how contracts containing solar integration charges were developed prior to
completion of Idaho Power’s solar integration study.
Regarding the Commission’s narrow construction of the issues to be considered during the May 21
hearing,the Alliance is concerned that it is impractical if not impossible to decouple “the type of solar
integration charge”to be appropriate from the question of whether the Commission should suspend
Idaho Power’s PURPA obligations or include an appropriate solar charge in PURPA contracts with
solar Qfs.The expected solar charge will by necessity be informed by the results of the uncompleted
solar integration study;the issue of the level of an integration charge is directly linked to the “type of
integration charge”the Commission will ultimately consider.
Therein lies an important point at this stage of IPC-E-14-09:Idaho Power not only does not have an
“appropriate integration charge,”it is nowhere near the point where it can attempt to or implement
one for contract purposes.Delaying the processing of legitimate QF PURPA contracts because Idaho
Power is not yet prepared to establish the integration charge that it says is required is not the fault of
the QFs.
Idaho Power has already taken one bite out of the regulatory apple in its attempts to repel additional
residential or utility-scale solar generation and integration to its system,the first being the
residential net metering case.Its attempt to unilaterally forestall any new solar QF contracts pending
completion of its solar integration study is unconvincing for several reasons:
Barring a change in methodology,Idaho Power’s solar integration study may well be flawed when
it is presented to the Commission.As with its wind integration study,Idaho Power acknowledges
that it is examining only integration costs and not the obvious benefits of having load-following
solar energy on Idaho Power’s system.Idaho Power agrees that solar’s load-following attributes
are much different from those of a resource such as wind:“Solar QFs receive an avoided cost price
that is much higher than other QF resources,particularly the other intermittent resource (wind)
because solar QF’s generation profile is a much better match to the Company’s need to serve load.”
(Petition at P.6).
The Alliance acknowledges the Commission’s caution of what it will consider at the May 21
hearing,but we struggle to accept that a case built primarily on an unfinished solar integration
study cannot be considered given the nature of the study itself,particularly if the study is to be
considered in a decision on whether to suspend Idaho Power’s legal obligations under PURPA.
Idaho Power witness Randy Aliphin testified that the “potential integration costs associated with
the 501MW of solar is approximately $146,181,685,”but that estimate is based on a $6.50 wind
integration cost,not as a result of any analysis of solar integration costs.So Idaho Power is asking
the Commission to consider an estimate without foundation for another resource with completely
different characteristics than solar.The fact is,Idaho Power has yet to identify the cost of solar
integration,making it impossible to consider such costs for purposes of new solar contracts when
or if they arrive at Idaho Power’s door.
Regardless,two days is insufficient time for any person or party other than Idaho Power to provide
the quality of comments they otherwise would if allowed adequate time to do so.As evidenced by
Idaho Power’s application and the accompanying testimony of Mr.DeVol and Mr.Allphin,Idaho
Power had as much time as it felt necessary to prepare this Petition.No other party has had that
luxury to digest let alone respond to the Petition.This is the second time within the space of two
years that Idaho Power has surprised its customers and others with legitimate interests in the
issues in this case,but also to catch the Commission itself completely by surprise.Idaho Power’s
application and entreaty for immediate relief provide no compelling reason for the Commission to
foreclose adequate public participation in this case.
For example,the Alliance finds itself disadvantaged with respect to its ability to fully participate in
this case due to the highly unusual processing of this case in the six days since the petition was
filed.While we acknowledge the unusual schedule established by the Commission comports with
Commission Rule 256,which allows a hearing to be scheduled “at least”two days after the
decision to hold it,such a tight deadline is unreasonable.For instance,while the hearing was set
for two days after the May 19 decision meeting,and while Order No.33039 states,“The
Company’s customers and any other interested members of the public are encouraged to attend
and give testimony.”It is unreasonable to expect that customers and members of the public even
know the hearing is taking place,regardless of the Commission’s May 19 news release,which was
not posted on the Commission’s website until the morning of May 20 —just one day before the
hearing.Furthermore,Order No.33039 states that,while hearings are held in accordance with the
Americans with Disabilities Act (ADA),“Persons needing the help of a sign language interpreter or
other assistance in order to participate in or to understand testimony and argument at a public
hearing may ask the Commission to provide a sign language interpreter or other assistance at the
hearing.The request for assistance must be received at leastfive (5)working days before the
hearing by contacting the Commission secretary at ...“A news release posted on the Commission
website the day before the hearing does not allow ample time for the Commission to comply with
this portion of its own Order.
-There is no firmly demonstrated pending crisis with regard to Idaho Power solar PURPA contracts
that may or may not show up.In fact,Idaho Power has no solar PURPA contracts at all that are
ready for PUC review.The Company did not reconcile in its Petition the apparent discrepancy
between its claim that it faces more than 500MW of solar contracts that,according to Mr.Allphin’s
testimony at P.4,are from “serious developers,with real projects,and not just ‘tire-kickers,”and
its claims during its Integrated Resource Plan processes that it cannot include solar generation as
a supply side resource because it cannot determine whether those solar projects will ever
materialize.Idaho Power witness DeVol’s testimony affirms the uncertain nature of even the most
broad range of integration costs:“I do not have any final cost numbers or estimates for solar
integration costs on Idaho Power’s system,as the (integration)study has not advanced to that
point at this time..”
Under normal circumstances,the Alliance would appear before the Commission to offer oral comments at
the May21 hearing.We understand and appreciate the Commission’s position that written comments
will carry the same weight as oral comments.Yet we believe the opportunity to provide direct oral
comments is crucial in allowing members of the public,including those most affected by the issues
presented in this case,to appear before the Commission cannot be overstated.The Alliance’s executive
director and its program staff are currently in Washington,D.C.,on Alliance business and will not return
until the Memorial Day weekend.Therefore,while the Alliance intends to petition the Commission for
intervenor status in this case depending on how it progresses,the Alliance believes it will be deprived of
the opportunity to fully participate in this stage of this case inasmuch as it cannot be present at the May
21 hearing.
The Alliance understands why Idaho Power and the Commission feel there is a sense of urgency in
accelerating the processing of IPC-E-14-09.However,for the reasons stated above we must object to a
schedule that not only short-circuits adequate public participation in a case of such enormous public
interest and consequence,but also a case based squarely on Idaho Power’s unilateral claim of yet another
pending PURPA train-wreck,which facts currently before the Commission do not appear to support,and
if they did we believe the current,seemingly chaotic situation would be largely of the Company’s making.
Respectfully submitted,
Ken Miller
Clean Energy Program Director
Snake River Alliance
P.O.Bo 1731
Boise,ID 83701
[phone]
[e-mail]
ELECTRONIC DELIVERY
Donovan Walker
Idaho Power Co.
[e-mail]