20200210Notice_of_Application_Order_No_34552.pdf

Office of the Secretary
Service Date
February 10,2020
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF IDAHO POWER'S )CASE NO.IPC-E-20-02
PETITION TO ESTABLISH AVOIDED COST )RATES AND TERMS FOR ENERGY )NOTICE OF APPLICATION
STORAGE QUALIFYING FACILITIES )UNDER PURPA )NOTICE OF INTERVENTION
)DEADLINE
)ORDER NO.34552
On January 21,2020,Idaho Power Company ("Company")filed a petition requesting
the Commission determine avoided cost rates,contract terms,and conditions applicable to energy
storage qualifying facilities ("QF"or "QFs")under the Public Utility Regulatory Policies Act of
1978 ("PURPA").
PURPA BACKGROUND
PURPA,and Federal Energy Regulatory Commission ("FERC")rules require state
commissions to establish published avoided cost rates for QFs with a nameplate capacity of 100
kilowatts ("kW")or less.18 C.F.R.§292.304(c)(1).The state commissions,in their discretion,
may establish published avoided cost rates for QFs greater than 100 kW.18 C.F.R.§
292.304(c)(2).State commissions may differentiate among QFs using various technologies based
on the supply characteristics of the resource.18 C.F.R.§292.304(c)(3)(ii).
In Idaho,this Commission has established a 100 kW project eligibility cap for wind
QFs and solar QFs to receive published avoided cost rates.Order Nos.32262 at 8,32697 at 13.
All other QF types have a 10 average Megawatt ("aMW")project eligibilitycap for published
avoided cost rates.Order No.32697 at 14.Published avoided cost rates in Idaho are calculated
by the Surrogate Avoided Resource ("SAR")method,which is based on the assumed cost of a
hypothetical combined cycle combustion turbine.See Order No.32697 at 17.Negotiated rates,
which are available for QFs above the project eligibilitycap,are calculated by the incremental cost
Integrate Resource Plan ("IRP")method.The IRP method calculates the marginal value of energy
on the Company's system on an hourlybasis given the Company's actual resource stack.See Order
No.32697 at 20-21.
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In addition to eligibility for published avoided cost rates,the project eligibility cap
determines the length of contract for which a QF is eligible.Those above the project eligibility
cap in Idaho are entitled to two-year contracts.Order No.33357 at 25.Those below the project
eligibilitycap in Idaho are entitled to twenty-year contracts.See Order No.33253 at 4.
PURPA ENERGY STORAGE IN IDAHO BACKGROUND
In Order No.33785,the Commission determined five energy storage QFs were entitled
to the terms and conditions available to solar QFs because the generation profiles of those QFs
aligned closely to the generation profiles of solar QFs,and based on the Commission's
interpretation of Luz Development and Finance Corporation,51 FERC ¶61,078 (1990).Order
No.33785 at 11-12.See also Order No.33858 at 3.
On January 17,2020,the United States District Court for the District of Idaho issued a
Memorandum Decision and Order in Franklin Energy Storage One et al.v.Kjellanderet al.,Case
No.1:18-cv-00236-REB,holding that the Commission's decision in Order No.33785 "established
an implementation plan that impermissibly classified the QF status of Plaintiffs'energy storage
facilities that are certified under [PURPA]as energy storage facilities."Memorandum Decision
at 37."Classifying such facilities as 'solar QFs'is outside the Commissioners'authority as state
regulators and therefore in violation of federal law."Id.While findingthat the Commission could
not treat these energy storage QFs as solar QFs,the Court specifically declined "to order [the
Commission]to require utilities under their jurisdiction to afford energy storage QFs all rights and
privileges afforded to 'other QFs'under the IPUC's PURPA implementation plan."Id.I
In response to the Memorandum Decision,and to two energy storage QF applications
received by Idaho Power immediately followingthe Memorandum Decision,Idaho Power filed
this petition requesting the Commission determine the proper avoidedcost rates and contract terms
applicable to energy storage QFs.Petition at 5.Idaho Power requests the Commission establish
a 100 kW eligibilitycap for energy storage QFs to receive published avoidedcost rates and twenty-
year contracts,the minimum project eligibilitycap allowed by FERC rules.Idaho Power requests
any energy storage QF above the eligibilitycap receive avoided cost rates calculated by the IRP
method and be eligible for two-year contracts.Petition at 2.
I The Commission voted to appeal the District Court's Judgment at the February 4,2020 Decision Meeting.
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NOTICE OF APPLICATION
YOU ARE HEREBY NOTIFIED that the Company requests the Commission establish
a 100 kW project eligibilitycap for energy storage QFs to receive published avoided cost rates and
twenty-yearcontracts.
YOU ARE FURTHER NOTIFIED that the Company bases its request for a 100 kW
project eligibility cap on its assertion that the IRP method is the only way to properly value an
energy storage QF's output and because the Company asserts the 100 kW project eligibilitycap is
the only effective way to prevent disaggregationof energy storage QFs into smaller QFs designed
only to comply with the project eligibilitycap.See Petition at 8.
YOU ARE FURTHER NOTIFIED that the Company states the only way to capture
the full range of benefits provided by energy storage facilities,such as to provide reserve capacity,
surge capacity,load-balancing,voltage support,firming of variable generation,or time-shifting
generationto match load,is for the utility to have operational control of the facility.See Petition
at9.
YOU ARE FURTHER NOTIFIED that the Application is available for public
inspection during regular business hours at the Commission's office.These documents are also
available on the Commission's web site at Click on the "Electric Cases"tab
then click on "Open Cases"and click on the case number as shown on the front of this document.
YOU ARE FURTHER NOTIFIED that all proceedings in this case will be held
pursuant to the Commission's jurisdiction under Title 61 of the Idaho Code and specifically Idaho
Code §§61-502 and 61-503.The Commission may enter any final Order consistent with its
authority under Title 61.
YOU ARE FURTHER NOTIFIED that all proceedings in this matter will be conducted
pursuant to the Commission's Rules of Procedure,IDAPA 31.01.01.000 et seq.
NOTICE OF INTERVENTION DEADLINE
YOU ARE FURTHER NOTIFIED that persons who wish to intervenein this matter to
obtain the rights of party (e.g.,to file formal discovery,or present evidence or cross-examine
witnesses at a hearing)must file a Petition to Intervene with the Commission under the
Commission's Rules of Procedure 72 and 73,IDAPA 31.01.01.072and .073.Persons who wish
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to intervene as a party must file a Petition to Intervene by February 28,2020.Such persons
shall also provide the Commission Secretary with their electronic mail address to facilitate further
communications.
YOU ARE FURTHER NOTIFIED that persons who would like to present their views
without parties'rights of participation and cross-examinationare not required to intervene but may
present their views by submitting written comments to the Commission.
YOU ARE FURTHER NOTIFIED that the Commission Secretary shall issue a Notice
of Parties after the deadline for intervention has passed.The Notice of Parties shall assign exhibit
numbers to each party in this proceeding.
YOU ARE FURTHER NOTIFIED that once the Notice of Parties is issued,
Commission Staff will informallyconfer with the parties to discuss a schedule to process this case
and other issues as raised by the parties.
ORDER
IT IS HEREBY ORDERED that persons desiring to intervene in this case for the
purpose of obtaining parties'rights of participation must file a Petition to Intervene with the
Commission,under Rules 72 and 73,IDAPA 31.01.72-.73,by February 28,2020.
IT IS FURTHER ORDERED that,after the Secretary issues a Notice of Parties,Staff
will informally confer with the parties to discuss the appropriate scheduling of this case.
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DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this
day of February,2020.
PAUL K LAN ,PRESIDENT
KRIS INE RAPER,C SIONER
Diane M.Hanian
Commission Secretary
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