20170113final_order_no_33689.pdf

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )
OF IDAHO POWER COMPANY TO ) CASE NO. IPC-E-16-36
APPROVE THE FIRST AMENDMENT TO )
ITS ENERGY SALES AGREEMENT WITH ) ORDER NO. 33689
_M_U_RP_HY __ F_L_A_T_P_O_W_E_R__.,_L_L_C _____ )
Office of the Secretary
Service Date
January 13, 2017
On December 22, 2016, Idaho Power Company filed an Application asking the
Commission to approve the First Amendment to its Energy Sales Agreement (ESA) with
Murphy Flat Power, LLC (Murphy Flat). The ESA is a contract under the Public Utility
Regulatory Policies Act (PURP A). The Amendment deletes an inapplicable provision, corrects a
typographical error, and updates and corrects information in the ESA's Appendix B. Idaho
Power asks that the Commission approve its Application upon Staffs review and without further
process. Application at 4.
Under PURP A, electric utilities must purchase electric energy from "qualifying
facilities" (QFs) at purchase or "avoided cost" rates approved by this Commission. 16 U.S.C. §
824a-3; Idaho Power Co. v. Idaho PUC, 155 Idaho 780, 789, 316 P.3d 1278, 1287 (2013). The
Commission has established two methods for calculating avoided costs, depending on the size of
the QF project: (1) the surrogate avoided resource (SAR) methodology, used to establish
"published" avoided cost rates; and (2) the integrated resource plan (IRP) methodology, to
calculate avoided cost rates for projects exceeding published rate limits. See Order No. 32697 at
7-8. Published rates are available for wind and solar QFs with a design capacity of up to 100
kilowatts (kW), and for QFs of all other resource types with a design capacity of up to 10
average megawatts (aMW). Id.; see also 18 C.F.R. § 292.304(c).
The Commission approved Idaho Power's ESA with Murphy Flat in 2014. Order No.
33198. Under the ESA, Idaho Power purchases and Murphy Flat sells energy generated by
Murphy Flat's solar facility (Facility) - a PURPA QF -near Murphy, Idaho. Application at 2.
The ESA contains prices based on the IRP avoided cost methodology. Id. at 2-3.
PROPOSED AMENDMENT
In the Amendment, Idaho Power and Murphy Flat agree to delete Article 3 .3 of the
ESA, which provides that Murphy Flat will "take such steps as may be required to maintain the
[QF's] status" as a solar published rate facility. Id. at 2; see Attachment 1 to Application in Case
ORDER NO. 33689
No. IPC-E-14-32 at 10 (ESA Art. 3.3). As noted in the Application here, the Facility "exceeds
the eligibility threshold for published avoided cost rates," thus the language of Article 3.3 does
not apply. Application at 2.
The Company and Murphy Flat also agree to correct Article 7.4 of the ESA to include
the word "Percentage," inadvertently omitted from the second sentence which should read, "All
pricing contained within Appendix E for the current applicable month(s) will be multiplied by
the Pricing Adjustment Percentage .... " Id at 3 (emphasis added). Finally, the Facility's
physical characteristics have changed since the Commission approved the ESA, which describes
the Facility's configuration, design, and construction in its Appendix B. Id Accordingly, the
Company and Murphy Flat agree to amend Appendix B to include "a more generalized Facility
description." Id at 3. The Company states the changes in the Amendment would "have no
material effect to the terms and provisions of the ESA and [ would] not alter the performance
requirements or pricing" in the ESA. Id at 4.
STAFF RECOMMENDATION
Staff believes the proposed changes are limited in scope and have no substantive
impact on the ESA. Accordingly, Staff recommended that the Company's request be approved
without further process.
DISCUSSION AND FINDINGS
The Commission has jurisdiction over this matter under Title 61 of the Idaho Code,
specifically Idaho Code§ 61-503, and PURPA. We find the proposed corrections and updates in
Idaho Power's ESA with Murphy Flat to be reasonable and appropriate. In addition, we find that
no further process is needed and thus approve the Amendment as proposed.
ORDER
IT IS HEREBY ORDERED that Idaho Power's Application to approve the First
Amendment to its Energy Sales Agreement with Murphy Flat Power, LLC is approved without
change or condition.
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within twenty-one (21) days of the service date of this Order. Within seven (7)
days after any person has petitioned for reconsideration, any other person may cross-petition for
reconsideration. See Idaho Code§ 61-626.
ORDER NO. 33689 2
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this f 3 /{...,,
day of January 2017.
ATTEST:
~
Diane M. Hanian
Commission Secretary
O:IPC-E-16-36_djh
ORDER NO. 33689
ER, ro M1ss10NER
ERIC ANDERSON, COMMISSIONER
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