20180831Decision Memo.pdf

DECTSION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER RAPER
COMMISSIONER ANDERSON
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL
FROM:SEAN COSTELLO
DEPUTY ATTORNEY GENERAL
DATE: AUGUST 29,2018
SUBJECT:THE APPLICATION OF IDAHO POWER COMPANY FOR APPROVAL
OR REJECTION OF AN ENERGY SALES AGREEMENT WITH CLEAR
SPRINGS FOODS, INC., FOR THE SALE AND PURCHASE OF
ELECTRIC ENERGY FROM THE CLEAR SPRINGS TROUT HYDRO
PROJECT, CASE NO. IPC.E.18-11.
On August 16,2018, Idaho Power Company (Idaho Power or the Company) applied
to the Commission for an order approving or rejecting its Energy Sales Agreement (ESA) with
Clear Springs Foods, Inc. (Clear Springs Hydro), under which Clear Springs Hydro would sell
and Idaho Power would purchase electric energy generated by the Clear Springs Trout Hydro
project (Facility). Application at l. The Application states the Clear Springs Trout Hydro is a
project of l0 average megawatts (MW) or less and a "qualifuing facility" (QF) under the Public
Utility Regulatory Policies Act (PURPA). Id. at2.
The parties have an existing ESA for the Facility that expires on October 31,2018.
The proposed ESA is a new contract with the same QF for a new term and updated current terms
and conditions. Id. The Application states that Clear Springs Hydro elected for the ESA to have
a2}-year term using the non-levelized rates for non-seasonal hydro projects smaller than l0
average MW. Id. at 4. The ESA uses the rates established by the Commission in Order No.
34062 dated May 16,2018. Id. Because the ESA is a replacement contract, its rates contain
capacity payments for the entire term, with no sufficiency period. 1d.
Because the existing ESA will expire on October 31,2018, Idaho Power requests a
procedural schedule that will allow for a final Commission determination prior to that date, and
requests the matter be processed by Modified Procedure. Id. at 5-6. In sum, Idaho Power
requests that the Commission issue an order accepting or rejecting the ESA and, if accepted,
IDECISION MEMORANDUM
declaring that all payments for purchases of energy under the ESA be allowed as prudently
incurred expenses for ratemaking purposes. Id. at 6.
STAFF RECOMMENDATION
Staff recommends that the Commission issue a Notice of Application and Notice of
Modified Procedure, with comments due within 2l days of the service date of the order, and
reply comments, if any, due within 7 days of the comment deadline.
COMMISSION DECISION
Does the Commission wish to issue a Notice of Application and a Notice of Modified
Procedure, with comments due within 21 days of the service date of the order, and reply
comments, if any, due within 7 days of the comment deadline?
Sean Costello
Deputy Attorney General
IPCE l8 I t_ sc_dec memo ntc ofapp
2DECISION MEMORANDUM