20210318Final_Order_No_34961.pdf

ORDER NO. 34961 1

Office of the Secretary
Service Date
March 18, 2021
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

On January 22, 2021, Idaho Power Company (“Company”) filed an Application
requesting consideration of an Energy Sales Agreement (“ESA” or “Agreement”) with Crystal
Springs Hydroelectric, L.P. for energy generated by the Crystal Springs Hydro Project (“Facility”).
The Facility is a 2,775-kilowatt nameplate capacity hydro facility near Buhl, Idaho and is a
qualifying facility under the Public Utility Regulatory Policies Act of 1978. The Facility’s
scheduled First Energy Date under the ESA is April 1, 2021.
On February 4, 2021, the Commission issued a Notice of Application and Modified
Procedure, setting a February 25, 2021 comment deadline and a March 4, 2021 reply comment
deadline. Order No. 34915. Commission Staff filed the only comments. The Company did not
reply.
Having reviewed the record, the Commission approves the Company’s Application as
discussed below.
THE APPLICATION
In its Application, the Company stated the Facility has been delivering energy to the
Company under an energy sales agreement dated March 31, 1984. The energy sales agreement
expires March 31, 2021. According to the Company, the Agreement contains published non-
seasonal, non-levelized avoided cost rates for a 20-year term. The Company requested the
Commission declare all payments for purchase of energy under the ESA be allowed as prudently
incurred expenses for ratemaking purposes.
STAFF COMMENTS
Staff recommended the Commission approve the ESA and declare all payments for
energy under the ESA be allowed as prudently incurred expenses. Staff’s review of the ESA
IN THE MATTER OF IDAHO POWER
COMPANY’S APPLICATION FOR
APPROVAL OR REJECTION OF AN
ENERGY SALES AGREEMENT WITH
CRYSTAL SPRINGS HYDROELECTRIC,
L.P., FOR THE SALE AND PURCHASE OF
ELECTRIC ENERGY FROM THE CRYSTAL
SPRINGS HYDRO PROJECT
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CASE NO. IPC-E-21-01

ORDER NO. 34961
ORDER NO. 34961 2

focused on the 90/110 performance band, the eligibility for and amount of capacity payments, and
the Facility’s non-seasonal hydro avoided cost rates.
Staff verified that the ESA’s non-seasonal hydro avoided cost rates are correct and
comply with existing orders. Staff also verified the 5-Day Ahead monthly generation forecast
provision is consistent with comparable provisions approved by the Commission. See e.g., Order
Nos. 34263 and 34870.
Staff noted the Facility receives no capacity payments under its existing contract but
that it should receive immediate payment for capacity based on the Commission’s recent approval
of the Black Canyon # 3 energy sales agreement. See Order No. 34295 at 5, Case No. IPC-E-19-
04. Staff believes the rationale from Commission Order No. 34295 for the Black Canyon #3 hydro
project also applies to the Facility. During the term of the Facility’s existing contract, the Company
has procured capacity and included the Facility's capacity in the utility's load and resource balance.
Therefore, Staff recommended the Facility be granted capacity payments for the full term of the
ESA.
COMMISSION FINDINGS AND DECISION
The Commission has jurisdiction over this matter under Idaho Code §§ 61-502 and 61-
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. The Commission also has authority under PURPA and FERC regulations to
set avoided cost rates, 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.
The Commission has reviewed the record, including the Application, the ESA, and the
comments of Staff. Based on our review, we find it reasonable to approve the ESA because it
contains Commission-approved terms that the Facility is eligible for based on its characteristics
such as fuel source, project size, and renewal contract status. Additionally, the Facility has helped
meet the Company’s need for additional capacity. The Commission thus finds it just and
reasonable to include capacity payments for the duration of the ESA. Last, the Commission finds
the Company’s payments for purchases of energy and capacity under the ESA are prudently
incurred expenses for ratemaking purposes.
ORDER NO. 34961 3

O R D E R
IT IS HEREBY ORDERED that the Company’s ESA with Crystal Springs
Hydroelectric, L.P. is approved.
IT IS FURTHER ORDERED that all payments made by the Company for purchases
of energy and capacity under the ESA are allowed as prudently incurred expenses for ratemaking
purposes.
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. Within seven (7)
days after any person has petitioned for reconsideration, any other person may cross-petition for
reconsideration. See Idaho Code § 61-626.
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 18th day
of March 2021.

PAUL KJELLANDER, PRESIDENT

KRISTINE RAPER, COMMISSIONER

ERIC ANDERSON, COMMISSIONER

ATTEST:

Jan Noriyuki
Commission Secretary

I:\Legal\ELECTRIC\IPC-E-21-01\orders\IPCE2101_Final_mh.docx