20211027Comments.pdf

JOHN R. HAMMOND, JR.
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-007 4
(208) 334-03s7
IDAHO BAR NO. 5470
IN THE MATTER OF THE APPLICATION
OF IDAIIO POWER COMPANY FOR
APPROVAL OR REJECTION OF THE
THIRD AMENDMENT TO THE ENERGY
SALES AGREEMENT WITH RIVERSIDE
INVESTMENTS I, LLC FOR THE SALE AND
PURCHASE OF ELECTRIC ENERGY FROM
THE MORA DROP HYDRO PROJECT
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Street Address for Express Mail:
1 133 1 W CHINDEN BLVD, BLDG 8, SUITE 20 I -A
BOISE, ID 83714
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
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CASE NO. IPC.E.2I.29
COMMENTS OF THE
COMMISSION STAFF
STAFF OF the Idaho Public Utilities Commission, by and through its Attorney of record,
John R. Hammond, Jr., Deputy Attorney General, submits the following comments.
BACKGROUND
On August 26,2021, Idaho Power Company ("Company") applied with the Commission
requesting approval or rejection of the Third Amendment to its Firm Energy Sales Agreement
("Third Amendment") with Riverside Investments I, LLC ("Seller") that sells energy to the
Company from the Mora Drop Hydro Project ("Facility"). The Facility is a qualifuing facility
("QF") under the Public Utility Regulatory Policies Act of 1978 ("PURPA").
The Commission approved the Company's Firm Energy Sales Agreement ("ESA") with
the Seller on June 30,2006, for the purchase and sale of energy from the Facility. Order No.
30008. ln2014, the Commission approved the Company's First Amendment to the ESA, which
STAFF COMMENTS ocToBER 27,2021
changed the definition of the Mid-Columbia Market Energy Cost in the ESA consistent with a
Commission-approved stipulation. See Order Nos. 33184 and 33053. In2016, the Commission
approved the Company's Second Amendment to the ESA, to amend Article 6.2.3 of the ESA to
include a change to the notification of Net Energy Amount ("NEA"); monthly adjustments from
three-month advance notice to one-month advance notice. Order No. 33575. The Company and
Seller have now entered the Third Amendment to the ESA to provide for notice of NEA monthly
adjustments, by the 25th of each month.
The Third Amendment modifies when the Seller must notiff the Company to revise future
monthly Estimated NEA. Currently, Section 6.2.3 requires the Seller to notifu the Company at
least one-month before the Seller revises a given month's Estimated NEA. The Third
Amendment states that "[a]fter the Operation Date, the Seller may revise any future monthly
Estimated Net Energy Amounts by providing written notice no later than 5 PM Mountain
Standard time on the 25th day of the month that is prior to the month to be revised." Third
Amendment at l, $ 6.2.3. If the 25th day falls on a weekend or holiday, written notice must be
received by the Company by the last business day before the 25th day of the month. Id. at l-2,
$ 6.2.3.
The Third Amendment provides this example: "...if the Seller would like to revise the
Estimated Net Energy Amount for October, they would need to submit a revised schedule no later
than September 25th or the last business day prior to Septemb er 25th." Id. at2, $ 6.2.3.
STAFF ANALYSIS
Staff recommends approval of the five-day advanced notice because monthly estimates
provided closer to the time of delivery can improve the accuracy of input used for short-term
operational planning. In addition, the five-day advanced notice has been authorized in prior
Commission orders including Order Nos. 34263 ,34870 and 34937.
There are non-substantive typographical errors in the proposed Third Amendment: the
Third Amendment is referred to as the First Amendment multiple times. The Company
responded through email communication on September 3,2021, that because these are non-
substantive typographical errors that do not change the effectiveness or the substance of the
revisions, the Company does not plan to re-file the Amendment. Instead, the Company will
correct them via handwritten changes to the Third Amendment. While Staff believes this is
2STAFF COMMENTS ocToBER 27,2021
acceptable, Staff recommends updating the Third Amendment to correct the mistakes and also to
include an additional provision based on the discussions below.
Staff notes neither the Third Amendment nor the ESA contains any provision addressing
modifications to the Facility during the contract term. Therefore, Staff recommends updating the
Third 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 (l) increases or decreases the Facility Nameplate Capacity,
or (2) changes the Qualifoing 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.
In the alternative, if the above provision is not included in the Third Amendment, Staff
recommends that the Third Amendment be rejected.
STAFF RECOMMENDATION
Staff recommends that the Commission approve the Third Amendment with five-day
notification contingent upon including the additional provision about modifications to the Facility
and correcting the typographical errors discussed above. Staff also recommends that after the
Third Amendment is updated and signed by both parties, the Commission require the Company to
file the updated Third Amendment with the Commission as a compliance filing. [n the
alternative, Staff recommends the Commission reject the Third Amendment if the provision that
addresses modifications to the Facility is not included.
.,STAFF COMMENTS ocToBER 27,202t
Respectfully submitted this day of October 2021,.
Hammond, Jr.
Attorney General
Technical Staff: Yao Yin
i : umisc : c omment sl ipce2 I .29 jhyy comments
4STAFF COMMENTS ocToBER 27,2021
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 27th DAY OF OCTOBER 2021,
SERVED THE FOREGOING COMMENTS OF THE COMMISSION STAFF, IN
CASE NO. IPC-E-21-29, BY E.MAILING A COPY THEREOF, TO THE FOLLOWING:
DONOVAN E WALKER
IDAHO POWER COMPANY
PO BOX 70
BOISE ID 83707-0070
E-MAIL: [e-mail]
[e-mail]
TERRY DAUGHERTY
RIVERSIDE INVESTMENTS
RTVERSIDE HYDRO I LLC
PO BOX 328
ADRIAN OR 97901
E-MAIL: [e-mail]
ENERGY CONTRACTS
IDAHO POWER COMPANY
PO BOX 70
BOISE rD 83707-0070
E-MAIL: [e-mail]
Y
CERTIFICATE OF SERVICE