20211028Reply Comments.pdf

DONOVAN E. WALKER
Lead Counsel
[e-mail]
October 28, 2021
VIA ELECTRONIC MAIL
Jan Noriyuki, Secretary
Idaho Public Utilities Commission
11331 West Chinden Blvd., Building 8
Suite 201-A
Boise, Idaho 83714
Re: Case No. IPC-E-21-29
Riverside Investments I, LLC – Mora Drop Hydro Project
Idaho Power Company’s Application re the Third Amendment to the
Energy Sales Agreement
Dear Ms. Noriyuki:
Attached for electronic filing is Idaho Power Company’s Reply Comments in the
above entitled matter. If you have any questions about the attached documents, please
do not hesitate to contact me.
Very truly yours,
Donovan E. Walker
DEW:cld
Enclosures
RECEIVED
2021 OCT 28 PM 3:33
IDAHO PUBLIC
UTILITIES COMMISSION
REPLY COMMENTS OF IDAHO POWER COMPANY - 1
DONOVAN E. WALKER (ISB No. 5921)
Idaho Power Company
1221 West Idaho Street (83702)
P.O. Box 70
Boise, Idaho 83707
Telephone: [phone]
Facsimile: [phone]
[e-mail]

Attorney for Idaho Power Company

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF THE APPLICATION
OF IDAHO POWER COMPANY FOR
APPROVAL OR REJECTION OF THE
THIRD AMENDMENT TO THE ENERGY
SALES AGREEMENT WITH RIVERSIDE
INVESTMENTS 1, LLC FROM THE MORA
DROP HYDRO PROJECT

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CASE NO. IPC-E-21-29

REPLY COMMENTS OF
IDAHO POWER COMPANY

Idaho Power Company (“Idaho Power” or “Company”), in response to the
comments filed by Commission Staff (“Staff”), hereby respectfully submits the following
Reply Comments.
I. INTRODUCTION AND BACKGROUND
On August 26, 2021, Idaho Power filed an application with the Commission for
approval or rejection of the Third Amendment (“Amendment”) to its Energy Sales
Agreement (“ESA”) with Riverside Investments I, LLC (“Riverside” or “Seller”). Riverside
sells energy to the Company from the Mora Drop Hydro Project (“Facility”). The Facility
is a qualifying facility under the Public Utility Regulatory Policies Act of 1978. The Third
Amendment that was executed by the Company and Riverside (“Parties”) is to allow the
REPLY COMMENTS OF IDAHO POWER COMPANY - 2
Facility to adjust the monthly Net Energy Amount (“NEA”) by the 25th of each month.
Specifically, Section 6.2.3 of the ESA provides the Seller with the option to adjust the
monthly estimated NEA within a specified time period. After the execution and approval
of the ESA, the Seller requested a change to the time period for making the NEA
adjustments, such that they can make adjustments by the 25th day of the month preceding
the month for which a change is requested. The Commission has previously approved
similar amendments to other energy sales agreements to incorporate the same change.
On October 27, 2021, Commission Staff (“Staff”) recommended approval of the
provision reflected in the Parties’ Third Amendment, but also recommended the
Commission require additional changes to the ESA:
Staff notes the ESA does not contain any provision addressing
modifications to the Facility during the contract term. Therefore, Staff
recommends updating the Amendment by including the following provision,
which has been included in recent PURPA contracts filed by the Company
with the Commission:

Any modifications to the Facility, including but not limited to
the generator or turbine, that (1) increases or decreases the
Facility Nameplate Capacity, or (2) changes the Qualifying
Facility Category, or (3) changes the Primary Energy Source
or (4) changes to the generator fuel and subsequently the
Fueled Rate or Non-Fueled Rate, will require a review of the
Agreement terms, conditions and pricing and Idaho Power, at
its sole determination, may adjust the pricing or terminate the
Agreement. If the Agreement is terminated because of said
modifications, the Seller will be responsible for any
Termination Damages.

Staff Comments, p 3.
II. IDAHO POWER REPLY COMMENT

The Company appreciates Staff’s analysis, review, and recommendation to
approve the five-day notification provision as provided in the Third Amendment.
However, the Company disagrees with Staff’s recommendation to update the Third
REPLY COMMENTS OF IDAHO POWER COMPANY - 3
Amendment by including an additional provision in the ESA to address modifications of
the Facility during the term of the contract. (“Staff Provision”).
Idaho Power contacted Riverside about Staff’s Comments and recommendation,
and inquired as to whether Riverside was in agreement to add the Staff Provision to the
Third Amendment. Riverside indicated that it would prefer that the Staff Provision not be
added to the Amendment, but stated it would accept the additional provision if its objection
was going to cause a significant delay to the approval of the Third Amendment.
Riverside requested an amendment to the ESA so that they could adjust the
monthly NEA at any point up to the 25th day of the preceding month. Idaho Power has
received similar such requests from several other QFs, has executed the same change
reflected in this Third Amendment in amendments to the ESAs with other QFs, and
received approval from the Commission in each case without modifying other sections of
the ESA or updating other sections of the ESA to current “standards”. The Company
believes that Staff’s recommendation to update the ESA by adding the Staff Provision
goes beyond the scope of the review and consideration of the Third Amendment and is
inconsistent with Commission practice regarding changes to a previously approved
PURPA ESA.
Further, absent a particular reason to do so, it is not appropriate to open up
contracts for a de novo review and inclusion of new provisions simply because an
amendment is requested. Idaho Power has over 100 Commission approved contracts
that have been executed over the past 35 years. Many of these contracts will have
numerous provisions that have changed over the years, and that may not have been
contemplated when the ESA was originally entered agreed to by parties. The Company
does not believe it is proper to open up PURPA contracts whenever an amendment is
requested and require the parties to update other sections of the contract to the most
REPLY COMMENTS OF IDAHO POWER COMPANY - 4
current language, especially when these other sections have nothing to do with the
amendment requested by the Seller.
The Company is willing to include the Staff Provision in any new contracts, and
has included such a provision in several, but Idaho Power objects to adding this Provision
to a previously approved ESA in the context of the Commission’s review of a contract
amendment to an unrelated provision.
III. CONCLUSION
The Company believes Staff’s recommendation to add a facility modification
provision is outside the scope of this Third Amendment. The Third Amendment as written,
is consistent with past amendments to the monthly NEA which the Commission has
approved for several QFs without changes to additional provisions. Idaho Power
respectfully requests that the Commission issue an order approving the Third Amendment
without modification, and without inclusion of the additional Staff Provision regarding
Facility modifications.
Respectfully submitted this 28th day of October 2021.

DONOVAN E. WALKER
Attorney for Idaho Power Company

REPLY COMMENTS OF IDAHO POWER COMPANY - 5
CERTIFICATE OF SERVICE

I HEREBY CERTIFY that on this 28th day of October 2021, I served a true and
correct copy of the within and foregoing REPLY COMMENTS OF IDAHO POWER
COMPANY upon the following named parties by the method indicated below, and
addressed to the following:

Terry Daugherty
Riverside Investments I, LLC
Riverside Hydro I, LLC
P.O. Box 328
Adrian, OR 97901

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John Hammond Jr.
Deputy Attorney General
Idaho Public Utilities Commission
P.O. Box 83720
Boise, ID 83720-0074

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Christy Davenport, Legal Assistant