20150730Application.pdf

DONOVAN E. WALKER
Lead Gounse!
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July 29, 2015
VIA HAND DELIVERY
Jean D. Jewell, Secretary
ldaho Public Utilities Commission
472 West Washington Street
Boise, ldaho 83702
Re: Case No. IPC-E-15-21
AgPower Jerome, LLC's Second Amendment
Agreement - ldaho Power Company's Application
Dear Ms. Jewell:
Enclosed for filing in the above mafter please find an
copies of ldaho Power Company's Application for Approval
Agreement Amendment.
An IDACORP Companv
to Firm Energy Sales
original and seven (7)
of Firm Energy Sales
Ww
Donovan E. Walker
DEW:csb
Enclosures
1221 W. ldaho St. (83702)
P.O. Box 70
Boise, lD 83707
DONOVAN E. WALKER (lSB No. 5921)
ldaho Power Company
1221West ldaho Street (83702)
P.O. Box 70
Boise, ldaho 83707
Telephone: [phone]
Facsimile: [phone]
[e-mail]
Attorney for ldaho Power Company
IN THE MATTER OF THE APPLICATION OF
IDAHO POWER COMPANY FOR APPROVAL
OF THE SECOND AMENDMENT TO THE
FIRM ENERGY SALES AGREEMENT
BETWEEN IDAHO POWER COMPANY AND
AGPOWER JEROME, LLC.
1.1,'fi' l:)
CASE NO. IPC-E-15-21
APPLICATION FOR APPROVAL
OF FIRM ENERGY SALES
AGREEMENT AMENDMENT
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
Idaho Power Company ("ldaho Powe/'), in accordance with RP 52 and the
applicable provisions of the Public Utility Regulatory Policies Act of 1978 ("PURPA'),
hereby respectfully applies to the ldaho Public Utilities Commission ("Commission") for
an order approving the Second Amendment ("Amendment") to the Firm Energy Sales
Agreement ("FESA") between ldaho Power and AgPower Jerome, LLC, a PURPA
qualifying facility ("QF"). The Amendment is submitted herewith as Attachment 1. This
Amendment changes the Net Energy Amount notification process, similar to the process
that has been approved by the Commission in six recently approved Energy Sales
Agreements and Energy Sales Agreement amendments with other PURPA QFs.
APPLICATION FOR APPROVAL OF FIRM ENERGY SALES AGREEMENT AMENDMENT - 1
ln support of this Application, ldaho Power represents as follows:
I. INTRODUCTION AND BACKGROUND
1. ldaho Power and AgPower Jerome, LLC ("Selle/') entered into a FESA on
October 15, 2010, for the purchase and sale of energy produced by the Double A
Digester project ("Facility") located near Jerome, ldaho. This FESA was approved by
the Commission in Order No. 32138 on December 16, 2010.
2. On August 19, 2014, the parties entered into a First Amendment to
change the definition of Mid-Columbia Market Energy Cost in this FESA, consistent with
the stipulation approved by the Commission in Order No. 33053 on June 10,2014. The
First Amendment was approved by the Commission in Order No. 33184 on November
21,2014.
3. Paragraph 6.2 of the FESA allows the Seller to adjust the "lnitial Year
Monthly Net Energy Amounts" on a quarterly basis, consistent with a Commission
directive that seller revisions are to be submitted no sooner than "the end of month
three and every three months thereafter." Order No. 29632, p.23.
4. As part of a resolution to a dispute relating to a Selle/s claim of force
majeure at another facility (AgPower DCD, LLC's Bettencourt Dry Creek Biofactory)
owned and operated by the same parent company as this Facility, the parties agreed to
amend this FESA on July 13, 2015, in order to be consistent with the other facility's
FESA.
II. THE AMENDMENT
5. ln six recently approved Energy Sales Agreements between ldaho Power
and other QFs, the Commission has allowed and approved a change in the Net Energy
Amount notification process from a quarterly to monthly basis. See Order Nos. 33102,
33103,33104,33156,33191, and 33240. ln addition, the Commission has approved
APPLICATION FOR APPROVAL OF FIRM ENERGY SALES AGREEMENT AMENDMENT - 2
amendments similar to this Amendment as recently as Apri! 28,2015. See Order No.
33289. ln Order No. 33102, the Commission stated:
we find that monthly, as opposed to quarterly, reporting of
energy generation estimates is a reasonably negotiated term
between the parties and not inconsistent with the
Commisslon's guidance and findings in Order No. 29632.
As we stated in that Order, 'it is reasonable and operationally
expedient to require QFs to provide ldaho Power with
monthly kWh production estimates The Commission
finds it reasonable to provide more frequent opportunities to
revise generation estimates than [the two years] proposed
by the Company. We find that the interest of the Companyin planning for QF resources is better served if the
generation forecast is a reliable estimate.' Order No. 29632
at23.
The Commission also stated, "We find that a provision allowing for monthly generation
estimate updates is consistent with that purpose." See Order No. 33102, p. 6.
6. This Amendment changes paragraph 6.2 to allow the Seller to adjust the
"lnitial Year Monthly Net Energy Amounts" on a monthly, rather than quarterly, basis.
As this is an existing project that has been operating and delivering energy under an
Operation Date of January 1, 2012, the lnitial Monthly Net Energy Amounts have been
revised by the Seller in accordance with the FESA. However, under this Amendment,
the Seller can submit future revisions on a monthly basis, with a minimum of 30 days
notice prior to the beginning of the next month, rather than once every three months. A
table was added to the Amendment indlcating both "Notification Month" and "Future
monthly Net Energy Amounts eligible to be revised," primarily to provide clarity to the
confusing nature of the Estimated Net Energy Amounts and the Selleds desire to
update the same. Both ldaho Power and the Seller propose Commission adoption of
this change. The Seller gains more clarity and flexibility in adjusting its estimated
energy deliveries and ldaho Power maintains the stability in the estimates necessary for
its planning and operation.
APPLICATION FOR APPROVAL OF FIRM ENERGY SALES AGREEMENT AMENDMENT . 3
II!. PROCEDURE
7. As Commission Staff ("Staff') recommended and the Commission
approved in Case No. IPC-E-15-11, due to the Iimited scope of the Amendment, ldaho
Power requests that the Commission approve the proposed Amendment upon Staffs
review and without further process.
8. Altematively, should the Commission determine that further process is
required, ldaho Power believes that a hearing is not necessary to consider the issues
presented herein and respectfully requests that this Application be processed under
Modified Procedure; i.e., by written submissions rather than by hearing. RP 201, ef seg.
IV. COMMUNICATIONS AND SERVICE OF PLEADINGS
9. Communications and service of pleadings, exhibits, orders, and other
documents relating to this proceeding should be sent to the following:
Donovan E. Walker
Lead Counsel
Regulatory Dockets
Idaho Power Company
1221 West ldaho Street
P.O. Box 70
Boise, ldaho 83701
dwal [e-mail]
dockets@id ahopower. co m
Randy C. Allphin
Energy Contracts Coodinator Leader
ldaho Power Company
1221 West ldaho Street
P.O. Box 70
Boise, ldaho 83707
rallphin@idahopower. com
V. REQUEST FOR RELIEF
10. ldaho Power respectfully requests that the Commission issue an order
approving the Second Amendment to the Firm Energy Sales Agreement submitted
herewith without change or condition
Respectfully submitted this 29h day of July 2015.
Attomey for ldaho Power Gompany
APPLICATION FOR APPROVAL OF FIRM ENERGY SALES AGREEMENT AMENDMENT.4
GERTIFICATE OF SERVIGE
I HEREBY CERTIFY that on the 29h day of July 2015 I served a true and conect
copy of the within and foregoing APPLICATION FOR APPROVAL OF FIRM ENERGY
SALES AGREEMENT AMENDMENT upon the following named parties by the method
indicated below, and addressed to the following:
AgPower Jerome, LLG
Jim R. Wiest
c/o Gamco Clean Enegy
9360 Station Street, Suite 375
Lone Tree, Colorado 80124
Hand DeliveredX U.S. Mail
_Ovemight Mail_FAXX Email [e-mail]
APPLICATION FOR APPROVAL OF FIRM ENERGY SALES AGREEMENT AMENDMENT - 5
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
cAsE NO. IPC-E-15-21
IDAHO POWER COMPANY
ATTACHMENT 1
SECOND AMENDMENT
TO THE
FIRM ENERGY SALES AGREEMENT
BETWEEN
IDAHO POWER COMPANY
AND
AGPOWER JEROME, LLC
This Second Amendment of the Firm Energy Sales Agreement ("Second Amendment") is
entered into on this ftlday of July .2015 by and between Idaho Power Company, an Idaho
corporation ("Idaho Power"), and AgPower Jerome, LLC, a Delaware limited liability company
("Jerome" or "Seller") (individually a "Party" and collectively the "Parties").
WITNESSETH:
WHEREAS, Idaho Power and Seller entered into a Firm Energy Sales Agreement on
October 15, 2010, ("Agreernent") for the purchase and sale of energy produced by the Seller's
facility ("Project") that was approved by the Idaho Public Utilities Commission ("Idaho PUC")
in Order No. 32138 on December 16, 2010;
WHEREAS, on August 19, 2014, the Parties entered into a First Amendment to change
the definition of Mid-Columbia Market Energy Cost in the Agreement consistent with the
Stipulation approved by the tdaho PUC in Order No. 33053 on June 10, 2014. The Second
Amendment was approved by the Idaho PUC in Order No. 33184 on November 21,2014;
WHEREAS, the Parties agree to amend the Agreement to replace Article 6, sections 6.2.2
and 6.2.3 relating to monthly Net Energy Amounts consistent with other recently approved
Energy Sales Agreements and to abide by the terms of this Second Amendment;
NOW THEREFORE, in consideration of the mutual promises and covenants and other
consideration set forth herein, the receipt and sufficiency of which are hereby acknowledged, the
Parties agree to the following amendments to the Agreement:
1. Incorporation of Recitals. The above-stated recitals are incorporated in this Second
Amendment and made a part of this Second Amendment by this reference to the same
extent as if these recitals were set forth in full at this point.
2. Article VI: Purchase and Sale of Net Enerry. Article 6, sections 6.2.2 and 6.2.3 shall
be deleted in their entirety and the following sections shall be substituted in their stead:
6.2.2 Seller's Adjustment of Initial Year Monthly Net Enerey Amounts - Prior to the
Operation Date, the Seller may revise all of the previous initial year monthly Net
Energy Amounts by providing written notice to Idaho Power in accordance with
paragraph25.1.
6.2.3 Seller's Adjustment of Monthly Net Energy Amounts After the Operation Date -
After the Operation Date, the Seller may revise any future monthly Net Energy
Page I of3
Amounts by providing written notice no later than 5 PM Mountain Standard time
on the last business day of the Notification Month specified in the following
schedule:
Notification
Month
Future monthly Net Energy
Amounts eligible to be revised
November
December
January
February
March
April
May
June
July
August
September
October
Project: 316151l5 Double A Digester
Firm Energy Sales Agreement
Second Amendment
January and any future months
February and any future months
March and any future months
April and any future months
May and any future months
June and any future months
July and any future months
August and any future months
Septernber and any future months
October and any future months
November and any future months
December and any future months
3.
a.) This written notice must be provided to Idaho Power in accordance with
paragraph 25.1 or by electronic notice provided and verified via retum
electronic verification of receipt to the electronic notices address specified
in paragraphzs.l.
b.) Failure to provide timely written notice of changed Net Energy Amounts
will be deemed to be an election of no change from the most recently
provided Net Energy Amounts.
Commission Approval. The obligations of the Parties under this Second Amendment
are subject to the Idaho PUC's approval of this Second Amendment and such approval
being upheld on appeal, if any, by a court of competent jurisdiction. The Parties will
submit this Second Amendment to the Idaho PUC and recommend approval in its entirety
pursuant toRP 274.
Effect of Amendment. Except as expressly amended by this Second Amendment, the
Agreement shall remain in full force and effect.
Capitalized Terms. All capitalized terms used in this Second Amendment and not
defined herein shall have the same meaning as used in the Agteement.
Scope of Amendment. This Second Amendment shall be binding upon and inure to the
benefit of the Parties hereto, and their respective heirs, executors, administrators,
successors, and assigns, who are obligated to take any action which may be necessary or
proper to carry out the purpose and intent thereof.
4.
5.
6.
Page 2 of 3
7.
8.
Authority. Each Party represents and warants that (i) it validly exists and in good
standing in the state in which it is organized, (ii) it is the proper party to amend the
Agreernent, and (iii) it has the requisite authority to execute this Second Amendment.
Counterparts. This Second Amendment may be executed in any number of
counterparts, each of which shall be deerned an original and all of which taken together
shall constitute a single instnrment.
IN WITNESS WHEREOF, the Parties hereto have caused this Second Amendment to be
executed in their respective rurmes on the dates set forth below:
IDAHO POWER COMPAI.IY
By:
Name:
ritr"' SVp R)W?.S, f,p[, il
Title:
out", -r/ * ,2rA'Date:1 la'.', l.\
AGPOWER JEROME
Name:
Project: 3l6l5l l5 Double A Digester
Firm Energy Sales Agreanent
Second Amendment Page 3 of3