20210225Final_Order_No_34937.pdf

ORDER NO. 34937 1

Office of the Secretary
Service Date
February 25, 2021

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF IDAHO POWER
COMPANY’S APPLICATION FOR
APPROVAL OR REJECTION OF A SECOND
AMENDMENT TO THE ENERGY SALES
AGREEMENT WITH ID SOLAR 1, LLC
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CASE NO. IPC-E-20-38

ORDER NO. 34937

On December 11, 2020, Idaho Power Company asked the Commission to approve or
reject an amendment to its Energy Sales Agreement (“ESA”) with ID Solar 1, LLC (“ID Solar 1”).
ID Solar 1 is a qualifying facility (“QF”) under the Public Utility Regulatory Policies Act of 1978
(“PURPA”).
On January 14, 2021, the Commission issued a Notice of Application and Notice of
Modified Procedure. Order No. 34893.
Now, the Commission approves the ESA.
BACKGROUND
Under PURPA, electric utilities must purchase the power produced by QFs. 16 U.S.C.
§ 824a-3(b); 18 C.F.R. § 292.303(a). The utility must purchase the energy at the avoided cost rate.
18 C.F.R. § 292.304(a). The avoided cost represents “the incremental costs to an electric utility
of electric energy or capacity or both which, but for the purchase from the qualifying facility or
qualifying facilities, such utility would generate itself or purchase from another source.” 18 C.F.R.
§ 292.101(b)(6). State utilities commissions have broad discretion to set avoided cost rates within
their respective jurisdictions. Rosebud Enterprises, Inc. v. Idaho PUC, 128 Idaho 624, 627, 917
P.2d 781, 784 (1996). FERC regulations require state regulatory commissions to establish
published avoided cost rates for all QFs 100 kW and smaller. 18 C.F.R. § 292.304(c)(1). The
Commission, in its discretion, may establish published avoided cost rates for QFs above 100 kW.
18 C.F.R. § 292.304(c)(2). In Idaho, published avoided cost rates are available for solar QFs up
to 100 kW. Order No. 32697 at 14. QFs above the project eligibility cap are eligible for avoided
cost rates determined by the incremental cost integrated resource plan method (“IRP Method”).
QFs below the project eligibility cap are eligible for avoided cost rates determined by the surrogate
avoided resource method. (“SAR Method”). See id. at 13-14.

ORDER NO. 34937 2
Under the jurisdictional arrangement in PURPA between state utilities commissions
and FERC, state utilities commissions “play the primary role in calculating avoided costs and
overseeing the contractual relationship between QFs and utilities operating under the regulations
promulgated by [FERC].” Independent Energy Producers Ass’n, Inc. v. California Public Utilities
Comm’n, 36 F.3d 848, 856 (9th Cir. 1994).
THE APPLICATION
ID Solar 1 is a 40 MW nameplate capacity solar QF on South Cloverdale Road between
Boise and Kuna. See Application at 1; see also IPC-E-14-20 Application at 1. The Commission
originally approved the ESA between Idaho Power and Boise City Solar, LLC in 2014. Id. at 2;
see also IPC-E-14-20, Order No. 33180. Boise City Solar, LLC was assigned and transferred to
ID Solar 1 in 2016. Application at 2; see also IPC-E-16-20, Order No. 33956.
ID Solar 1 requested to change the time in which it may adjust its monthly estimated
Net Energy Amounts. Application at 2. The proposed amendment would allow ID Solar 1 to adjust
its estimated Net Energy Amounts on or before 5 pm on the 25th day of the month preceding the
month for which the estimates are made. Id. at 2-3. Currently, ID Solar 1 must provide
adjustments to its estimated Net Energy Amounts one month in advance. See IPC-E-14-20
Application at Att. 1, p. 14. The Company stated this amendment would be similar to other
provisions approved by the Commission. Application at 2.
STAFF COMMENTS
Staff recommended the Commission approve the amendment. Staff Comments at 2.
Staff stated the Commission approved the same amendment in Case Nos. IPC-E-19-01, -03, -04,
-07, -12, and approved the provision in a new ESA in IPC-E-20-27. Id. Staff stated that updating
the monthly estimates closer to the time of delivery can improve the accuracy of the forecast,
thereby improving the usefulness of the forecasts in the Company’s short-term operational
planning. Id. Staff noted that all previous Commission approvals of the same amendment were
for SAR Method contracts, and this would be the first IRP Method ESA to use the closer-in-time
update. Id. Staff stated it is reasonable to think that allowing QFs with IRP Method contracts to
update monthly Net Energy Adjustments closer-in-time would provide the same benefit—greater
accuracy—as is gained by allowing SAR Method QFs to update closer to the forecasted month.
Id.

ORDER NO. 34937 3
COMMISSION FINDINGS AND DECISION
The Commission has jurisdiction over this matter under Idaho Code §§ 61-501, -502
and -503. The Commission is empowered to investigate rates, charges, rules, regulations,
practices, and contracts of public utilities and to determine whether they are just, reasonable,
preferential, discriminatory, or in violation of any provision of law, and to fix the same by
order. Idaho Code §§ 61-502 and 61-503. In addition, the Commission has authority under
PURPA and FERC regulations to set avoided costs, to order electric utilities to enter fixed-term
obligations for the purchase of energy from QFs, and to implement FERC rules. The Commission
may enter any final order consistent with its authority under Title 61 and PURPA.
Pursuant to this authority, we have reviewed the record, including the Application and
comments. We find that the amendment is reasonable because it is likely to produce more accurate
estimates, which will help Idaho Power’s short-term operational planning.
O R D E R
IT IS HEREBY ORDERED that the amendment to the ESA is approved.
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 with regard to any
matter decided in 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.
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ORDER NO. 34937 4
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 25th day
of February 2021.

PAUL KJELLANDER, PRESIDENT

KRISTINE RAPER, COMMISSIONER

ERIC ANDERSON, COMMISSIONER

ATTEST:

Jan Noriyuki
Commission Secretary

I:\Legal\ELECTRIC\IPC-E-20-38\IPCE2038_final order_ej.docx