20200625Answer to Idaho Power Motion.pdf

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II}?ff JLii{ 25 PH 3: 26JOHN R. HAMMOND, JR.
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
(208)334-03s7
IDAHO BAR NO. 5470
Street Address for Express Mail:
I 1331 W CHINDEN BLVD, BLDG 8, SUITE 201-4
BOISE,ID 83714
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
' :"'1{ lft. i.....: i UQLIL/r,; ' i',i:,:ii i,:li;ft{}$Sii$N
IN TIIE MATTER OF THE APPLICATION
OF IDAHO POWER COMPANY FOR
APPROVAL OR REJECTION OF AI\
ENERGY SALES AGREEMENT WITH BIG
WOOD CANAL COMPAIIY FOR THE SALE
AND PI]RCHASE OF ELECTRIC ENERGY
FROM THE SAGEBRUSII HYDRO
PROJECT
CASE NO.IPC.E-19.38
AI\SWER TO IDAIIO POWER
COMPAI\IY'S MOTION FOR
APPROVAL OF FIRST
AMENDMENT TO ENERGY
SALES AGREEMENT OR
ALTERNATTVELY FOR
CLARIFICATION AI\D/OR
RECONSIDERATION
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The Commission Staff ("Staff') of the Idaho Public Utilities Commission, by and
through its attorney, Deputy Attorney General John R. Hammond Jr. files this Answer to Idaho
Power Company's ("Company") Motion for Approval of First Amendment to Energy Sales
Agreement in Compliance with Order No. 34677 or Alternatively for Clarification and./or
Reconsideration ("Motion") pursuant to ldaho Code $ 6l-626(l) and Commission Rules of
Procedure 53,56,325 and 331. IDAPA 31.01.01.53, .56,.325 and .331.
BACKGROUNI)
On December 9,2019, the Company filed an Application seeking approval or rejection
of an Energy Sales Agreement ('ESA") between the Company and Big Wood Canal Company
("Seller"), for the Sagebrush hydro project ("Facility") . See Application at l. The Facility is a 575-
kilowatt ("kW") nameplate capacity qualiffing facility ("QF") near Gooding, Idaho under the
1ANSWER JUNE 25,2020
Public Utility Regulatory Policies Act of 1978 ("PURPA"). Id. at 2. The Facility previously
delivered energy to the Company under a PURPA energy sales agreement executed on April 1,
1985. Id. at2. lnthat agreement the nameplate capacrty of the Facility was 430 kW.
On January 10,2020, the Commission issued its Notice of Application and Notice of
Modified Procedwe. Staff filed written comments on January 31,2020. Wood Hydro, LLC
("Wood Hydro") filed reply comments on February 5,2020.r The Company filed reply comments
on February 21,2020. On March 17,2020, Wood Hydro filed supplemental reply comments.
On May 28, 2020, the Commission issued Order No. 34677 approving the ESA
contingent upon certain modifications to it being implernented. In Order 34677 the Commission
found it reasonable for the Seller to continue to be paid for capacity up to only 430 kW for the full
termoftherenewalESA. OrderNo.34677at5;seealsoOrderNo.32697at2l-22. However,the
Commission also found that the 145-kW increase in nameplate capacity for the Facility would not
receive capacity payments until the Company becomes capacity deficient. Order No. 34677 at 6.
On June 18,2020,Idaho Power frled the Motion, proposing a method using hourly
meter data to implement the Commission's modifications made to the ESA in Order No. 34677.
STAFF'S ANSWER
Staff recommends that the Commission grant the Company's Motion for Clarification
and/or Reconsideration pursuantto ldaho Code $ 61-626 and Commission Rules of Procedure 325
and./or 332 md set a procedural schedule to allow for discovery and the filing of written comments
to fully develop a record to evaluate the First Amendment to the ESA.
According to the Company, the First Amendment is designed to allow the Seller to
receive immediate capacity payments for the generation of the 430 kW only and to allow capacity
payments for the incremental generation from the increased 145 kW of the Facility when the
Company's system becomes capacity deficient in July of 2026. The First Amendment contains
provisions that have not been used in any previous QF contracts and Staffasserts that an in depth
review of them is necessary to ensure that it complies with OrderNo.34677, does not interfere with
other required provisions included in the ESA, and complies with previous Commission orders.
Staff also wishes to determine whether the rate structure proposed by the First Amendment will
I Ted Sorenson represents that he is filing the Reply Comments on behalf of Wood Hydro. Sorenson is listed as a
govemor of Wood Hydro according to records of the Idaho Secretary of State. He is also listed as an "Authorized
Agent" of Big Wood as set forth in the ESA. .See ESA at p. l, paragraph 1.2, and p. 33, paragraph25-2.
2ANSWER JUNE 25,2020
make measuring compliance with 90/110 requirements difficult. Staff also desires to detennine
whether the provisions of the First Amendment will prevent the Seller from receiving immediate
capacity payments for generation from the incremental 145 kW of capacity.
CONCLUSION
Staffrecommends the Commissiongrantthe Company's Motion forClarifrcation and/or
Reconsideration. Staffalso recommends that the Commission set a procedural schedule to consider
the issues raised by Idaho Power's Motion and First Amendment. Staff recommends that this
procedural schedule allow time for discovery and for the issues to be reviewed by the Commission
through the filing of written comments of the parties.
Respectfully submitted this 256day of June 2020.
Hammond, Jr.
Attorney General
J
3ANSWER JUNE 25,2020
CERTIF'ICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 25ft DAY OF JUNE 2020, SERVED
THE FOREGOTNG ANSWE& IN CASE NO. IPC-E-19-38, By E-MAILING A COPY
THEREOF, TO THE FOLLOWING:
DONOVAN E WALKER
REGULATORY DOCKETS
IDAHO POWER COMPANY
PO BOX 70
BOISE ID 83707-0070
E-MAIL: [e-mail]
dockets @ idahopower. com
DAVID STEPHENSON
BIG WOOD CANAL CO
4O9N APPLE ST
SHOSHONE ID 83352
E-MAIL: [e-mail]
C. TOM ARKOOSH
ARKOOSH LAW OFFICES
802 W BANNOCK ST
SUITE LP IO3
PO BOX 2900
BOISE ID 83701
E-MAIL: [e-mail]
ENERGY CONTRACTS
IDAHO POWER COMPANY
PO BOX 70
BOISE ID 83707-0070
E-MAIL: [e-mail]
TED SORENSON
WOOD HYDRO LLC
IO32 GRANDVIEW DR
ryINS UT 84738
E-MAIL: [e-mail]
Kd lY,ffiv{t<tN
KERI J. HA!\,tlcR
Assistant to John R. Hammond Jr
4ANSWER JUNE 25,2020