20150505Comments.pdf

DAPHNE HUANG
DEPUTY ATTORNEY GENERAL r n!, ". 33
IDAHO puBLIC UTILITIES coMMISSIoN 1n i1 !!;i\1' - -t 1" i c-'
PoBox83720 ',rr.: ',;,.,i"BOISE, IDAHO 83720-0074 r;\ tii : , - , 'i r
[phone]
IDAHO BAR NO. 8370
Street Address for Express Mail:
472W. WASHINGTON
BOISE, IDAHO 83702.5918
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF IDAHO POWER )
coMPANy'S APPLICATION TO APPROVE OR ) CASE NO. IPC-E-15-08
REJECT ITS ENERGY SALES AGREEMENT )
WITH THE IDAHO DEPARTMENT OF WATER ) COMMENTS OF THERESOURCES. ) COIVTMISSION STAFF
)
)
COMES NOW the Staff of the Idaho Public Utilities Commission, by and through its
Attorney of record, Daphne Huang, Deputy Attorney General, and in response to the Notice of
Application and Notice of Modified Procedure issued in Order No. 33278 on April 14,2015, in
Case No. IPC-E-15-08, submits the following comments.
BACKGROUND
On March 3l,20l5,Idaho Power Company filed an Application asking the Commission to
approve or reject its Energy Sales Agreement (ESA) with the Idaho Department of Water
Resources (IDWR). Under that agreement, IDWR would sell, and Idaho Power would purchase,
electric energy generated by the Pristine Springs #3 hydro project (Facility) located near Jerome,
Idaho.
STAFF COMMENTS MAY 5,2015
On March 26,2015,Idaho Power entered into its ESA with IDWR pursuant to the terms
and conditions of various Commission Orders, and under the Public Utility Regulatory Policies
Act (PURPA). Application at 2. Under PURPA, electric utilities must purchase electric energy
from o'qualifying facilities" (QFs) at rates approved by the applicable state regulatory agency - in
Idaho, this Commission. l6 U.S.C. S 824a-3; Idaho Power v. Idaho PUC,155 Idaho 780,789,
316 P.3d 1278,1287 (2013). The purchase or "avoided cost" rate shall not exceed the
"incremental cost" to the utility, defined as the cost of energy which, "but for the purchase from
[the QF], such utility would generate or purchase from another source." l6 U.S.C. $ 82aa-3(d); 18
C.F.R. 5 292.101(6) (defining "avoided cost").
Idaho Power states that the Facility is a QF under PURPA and has a nameplate rating of
200 kilowatts (kW). Application at 4. The Facility is currently selling energy to Idaho Power
under a 10-year agreement that was executed in 2005. Id. at2. This Commission approved the
Facility's existing l0-year agreement with Idaho Power in April 2005. Order No. 29767. That
agreement is set to expire April 30, 2015. Application at 2.
"[U]nder the terms of the replacement ESA, IDWR elected to contract for a five-year term
using non-levelized, non-seasonal hydro published avoided cost rates as currently established by
the Commission . . . for replacement contracts and for energy deliveries of less than l0 [average
megawaffs (aMW)1." Id. at 4 (citing Order Nos. 3 3084, 32697, 327 37).
Idaho Power states IDWR will be required to provide data with which Idaho Power can
confirm that under normal conditions, the Facility will not exceed 10 aMW on a monthly basis.
Id. at 4.
Idaho Power also asserts the ESA "contains revised terms and conditions" that were
recently approved by the Commission in Case Nos. IPC-E-14-06,IPC-E-14-07, and IPC-E-14-12.
Id. at 5. These terms include references to the Intercontinental Exchange (ICE) index and formula,
Delay Liquidated Damages and Delay Security, and seller ownership of environmental attributes,
among other provisions. 1d.
According to Idaho Power, the ESA satisfies requirements regarding execution of a
Generation Interconnection Agreement, designation as a network resource, and administration of
Idaho Power's Open Access Transmission Tariff (OATT), in compliance with FERC. Id. at 6.
The Facility's Scheduled First Energy Date is May 1, 2015. Id. at4. The ESA will become
effective only upon the Commission's approval and finding that all payments made by Idaho
STAFF COMMENTS MAY 5,2075
Power to IDWR for purchases of energy are "allowed as prudently incurred expenses for
ratemaking purposes." Id. at 6-7 .
Idaho Power requests that, if approved, such approval be effective May l, 2015, to avoid a
lapse between the existing and replacement ESAs. Id. at7.
STAFF ANALYSIS
Staff has reviewed the proposed rates and conflrrms they are correct. Because this project
received capacity payments in its prior agreement, the rates in the replacement contract include
capacity payments for the full term of the proposed Agreement. This arrangement is consistent
with Order Nos. 32697 ,32737, and3287l. All other terms and conditions contained in the
proposed Agreement are consistent with prior Commission orders.
RECOMMENDATIONS
Staff recommends that the Commission approve all of the Agreement's terms and
conditions and declare that all payments made by Idaho Power to the Idaho Department of Water
Resources for purchase of energy from the Pristine Springs #3 Project will be allowed as prudently
incurred expenses for ratemaking purposes.
Respectfully submitted this day of May 2015.
Technical Staff: Yao Yin
i:umisc:comments/ipce I 5.8djhyy comments
qb
Daphne fluang
Deputy Attomey Genera
STAFF COMMENTS MAY 5,20t5
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 5.h DAY oF MAY 2015, SERVED
THE FOREGOING COMMENTS OF THE COMMISSION STAFF, IN CASE
NO. IPC.E.15-08, BY MAILING A COPY THEREOF, POSTAGE PREPAID, TO THE
FOLLOWING:
DONOVAN E WALKER
REGULATORY DOCKETS
IDAHO POWER COMPANY
PO BOX 70
BOISE rD 83707-0070
E-mail: [e-mail]
dockets@idahopower. com
BRIAN PATTON
BUREAU CHIEF PLANNING
ID DEPT OF WATER RESOURCES
3228 FRONT STREET
BOISE TD 83720
E-mail : [e-mail]. gov
RANDY C ALLPHIN
ENERGY CONTRACT ADMINISTRATOR
IDAHO POWER COMPANY
PO BOX 70
BOrSE rD 83707-0070
E-mail : [e-mail]
CERTIFICATE OF SERVICE