20191203Reply Comments.pdf

DONOVAN E. WALKER (lSB No. 5921)
ldaho Power Company
1221 West ldaho Street (83702)
P.O. Box 70
Boise, ldaho 83707
Telephone: [phone]
Facsimile: [phone]
lnordstrom@ idahopower. com
Attorney for ldaho Power Company
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
RECEIVED
ill9 DIC -3 pH t: SB
IN THE MATTER OF THE APPLICATION
OF IDAHO POWER COMPANY FOR
APPROVAL OF A POWER PURCHASE
AGREEMENT WITH JACKPOT
HOLDINGS, LLC FOR THE SALE AND
PURCHASE OF UP TO 220
MEGAWATTS OF RENEWABLE SOLAR
GENERATION.
CASE NO IPC-E-19-14
IDAHO POWER COMPANY'S
REPLY COMMENTS
I, INTRODUCTION
ldaho Power Company ("ldaho Power" or "Company") respectfully submits the
following Reply Comments in response to comments filed by the ldaho Public Utilities
Commission ("Commission'') Staff ("Staff') and the City of Boise. ln these Reply
Comments, ldaho Power provides an update on the election within the Power Purchase
Agreement ("PPA" or "Agreement") that granted ldaho Power, or any ldaho Power
affiliate, a Right of First Offer ('ROFO) to purchase the Jackpot Solar Facility ("Jackpot
Solar" or "Facility") and will respond to the City of Boise's concern regarding the
IDAHO POWER COMPANY'S REPLY COIVIMENTS . 1
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II. NOTICE REGARDING ROFO NEGOTIATIONS
On October 23,2019,ldaho Power filed comments notifying the Commission that
it was electing to exercise its right to negotiate for the purchase of the Jackpot Solar
Facility pursuant to its ROFO in Section 8.4 of the PPA1 through a non-regulated
IDACORP affiliate, ln response to this notification, Staff s comments indicated that
extra scrutiny would be required to ensure that IDACORP does not unduly profit from
ldaho Power customers because of a possible affiliated transaction with the regulated
utility.z 16 the intervening time between the Company's October 23'd comments and
Staff's November 26th comments, the Company determined that it would not be
purchasing the Jackpot Solar Facility. On November 20,2019 the Company sent a letter
to Alternative Power Development Northwest, LLC ('ADP') confirming the release of its
ROFO for the Jackpot Solar Facility. This letter is provided as Attachment 1. As there
will be no affiliate purchase of the Jackpot Solar Facility, Staff's concerns should be
alleviated.
III. DECISION TO NOT PURSUE TH FRANKLIN SOLAR OPTION
While not an official intervenor in the case, the City of Boise ("City") filed
comments regarding ldaho Power's decision to decline the purchase of an additional
I Comments of ldaho Power Company Regarding PPA Elections. October 23, 2019
2 Staffs Comments, page 3 and '16.
IDAHO POWER COMPANY'S REPLY COIVMENTS - 2
Company's decision to decline the option to purchase an additional 100 megawatts
('MW') of renewable solar generation known as the Franklin Solar Facility.
Ultimately, ldaho Power agrees with Staff's analysis and recommendation to
approve the PPA and that the costs incurred under the PPA be deemed prudent for
ratemaking purposes.
100 MW of output from the Franklin Solar Facility and requested that the Commission
require ldaho Power to continue studying the ability to purchase the additional 100 MW
from Franklin Solar.: ldaho Power appreciates the City's comments in this case,
however, the option to pursue Franklin Solar ended when ldaho Power delivered a
Notice to APD on October 18, 2019 stating that it elected not to exercise its right and
option to purchase the 100 MW identified as Franklin Solar. The Company's decision
was laid out in its comments filed with the Commission on October 23, 2019 citing
serious concerns over its ability to add intermittent and variable generation beyond the
120 MW from the Jackpot Solar purchase, unsolicited offers lower than the Franklin
Solar price of $23.'1 1, customers requiring additionality, and lastly credit rating agencies
taking an unfavorable view of additional large PPA obligations.
ldaho Power understands the City's concerns, and notes that the decision to
decline the Franklin Solar option does not preclude the Company from pursuing other
renewable energy projects. The Company is committed to working with customers
that set renewable goals while simultaneously pursuing its own goal of 100 percent
clean energy for all customers by 2045, The Company's decision to not pursue the
Franklin option should not be viewed as a departure from its stated goals.
ilr. coNcLusroN
ldaho Power would like to express its appreciation of the Commission Staff who
worked with ldaho Power through the additional modeling that was required to support
Staffls analysis and recommendation for the Jackpot Solar PPA. ldaho Power agrees
with Staffls recommendation to approve the Jackpot Solar PPA and that all payments for
purchases of energy under the PPA be allowed as prudently incurred expenses for
3 City of Boise's comments, page 3
IDAHO POWER COMPANY'S REPLY COMMENTS - 3
ratemaking purposes. The Company also acknowledges the City of Boise's concerns,
however, the decision to not pursue the Franklin Solar option does not preclude the
Company from pursuing other renewable energy projects that align with its clean energy
goal.
ldaho Power respectfully requests that the Commission adopt Staff s
recommendation to issue an order approving the Jackpot Solar PPA by December 20,
2019, and that all payments for purchases of generation under the PPA be allowed as
prudently incurred expenses for ratemaking purposes and be included for collection in
futu re Power Cost Adjustment filings.
DATED at Boise, ldaho, this 3rd day of December 2019.
DONOVAN E. WALKER
Attorney for ldaho Power Company
IDAHO POWER COMPANY'S REPLY COMMENTS - 4
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on this 3'd day of December 2019 I served a true and
correct copy of IDAHO POWER COMPANY'S REPLY COMMENTS upon the following
named parties by the method indicated below, and addressed to the following:
Commission Staff
Edward Jewell
Deputy Attorney General
ldaho Public Utilities Commission
1 1331 W. Chinden Boulevard
Building 8, Suite 201-A
Boise, ldaho 83714
Hand Delivered
_U.S. Mail
_Overnight Mail
_FAXX Email edward. iewell@puc. idaho.qov
Sandra D. Holmes
Legal Administrative Assistant
IDAHO POWER COMPANY'S REPLY COMMENTS - 5
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
CASE NO. IPC-E.19-14
IDAHO POWER COMPANY
ATTACHMENT 1
DONOVAN E. WALKER
Lead Counsal
dwalker(Oidahopower.com
November 20,2019
Kris Ormseth
Stoel Rives LLP
101 S. Capital Boulevard, Suite 1900
Boise, ldaho 837 02-77 05
e-mail: kris.ormseth tOstoel.com
HAND DELIVERY
Re: Notice of Release of Right of First Offer on Ownership
Kris, Peter, and Elizabeth:
As discussed with Kris on Monday, please let this serve as notice pursuant to
Section 8.4 of the Power Purchase Agreement ("PPA") dated March 22,2019, between
Jackpot Holdings, LLC and ldaho Power Company that ldaho Power Company is
releasing its Right of First Offer on Ownership pursuant to the August 12, 2019, Notice
from Alternative Power Development Northwest, LLC ('APD') that it intends to enter into
a Restricted Transaction under the PPA.
For the avoidance of doubt, APD may enter into a Restricted Transaction, on
such price and terms as are acceptable to APD in its sole discretion (other than terms or
conditions that would in any manner modify the PPA without ldaho Power Company's
prior written consent), at any time prior to 180 days from the date hereof without
presenting any such Restricted Transaction to ldaho Power. lf APD has not completed
a Restricted Transaction on or before May 17, 2020, any subsequent Restricted
Transaction would again be subject to Section 8.4 of the PPA.
allruoL!pgryy6p,
1221 W rd.ho 5t. (83702)
CO. 8ox 70
Boite. lD 83707
an rDAcoRP com@n!
Peter J. Richardson
RICHARDSON ADAMS, PLLC
515 North 27th Street
Boise, ldaho 83702
e-mail: [e-mail]
Elizabeth Woolstenhulme
Alternative Power Development, Northwest, LLC
515 North 27th Street
Boise, ldaho 83702
e-mail: [e-mail]
Kris Ormseth
Peter J. Richardson
Elizabeth Woolstenhulme
October 18,2019
Page 2 ol 2
ldaho Power remains very supportive of the project and we wish you well in your
pursuit of a sale transaction.
Si
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Donovan E. Walker
Lead Counsel
ldaho Power Company