20210104Exhibit 12.pdf

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Exhibit 12
Errmlos!Poi,ER=
AnD COnPCOmpany
DONOVAil E. WALKER
SenlorCounrel
dwal kcr0idahooower.com
May 25, 2010
VIA HAND EELIVERY
Jean D. Jewell, Secretary
ldaho Public Utilities Commission
472 West lAhshington Strcet
P.O. Box 83720
Boise, ldaho 837 2A-007 4
Re:.:,, Case No. IPC-E-10-16
IN THE MATTER OF THE APPLICATION OF IDAHO POWER COMPANY
FOR APPROVAL OF A FIRM E'VERGY SALES AGRtrMENT YVITH NEW
ENERGY ONE UC FOR THE SALE AND PURCHASE OF ELECTRIC.ENERGY FRAM THE ROCK CREEK DAIRY AMIErcB'C D'GE1S7OR
PROJECT
Dear Ms. Jewell
,Enclosed for filing :pbase find an original and'seven (7) copies of ldaho Potrer
Company'sApplication in the above matter.
very yours,
?
Donovan E.lAlalker
DEW:csb
Enclosules
P.O. Box 70 (E3707)
1221 W. ldaho St
Boke, lD 83702
DONOVAN E. WALKER (lSB No. 5921)
LISA D. NORDSTROM (lSB No. 5733)
ldaho Power Company
P.O. Box 70
Boise, ldaho 83707
Telephone: [phone]
Facsimile: [phone]
dwalker@ idahooower. com
[e-mail]
?.&l[n.r,t AS pt, & 3,
urrri?ffioctY,r?ii$u,u*
Attomeys for ldaho Power Company
Stneet Address for Exoress Mail:
1221 West ldaho Street
Boise, ldaho 837A2
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MAfiER OF THE APPLICATION
OF IDAHO POWER COMPANY FOR
APPROVAL OF A FIRM ENERGY SALES
AGREEMENT WITH NEW ENERGY ONE,
LLC, FOR THE SALE AND PURCHASE
OF ELECTRIC ENERGY FROM THE
ROCK CREEK DAIRY ANAEROBIC
DIGESTOR PROJECT.
CASE NO. rP&E-10-16
APPLICATION
ldaho Power Company ("ldaho Powef or the "Gompan/), in accordance with
ldaho Code S 61-503 and RP 52 and the applicable provisions of the Public Utilfiy
Regulatory Policies Act of 1978 fPURPA"), hereby respectfully applies to the ldatro
Public LJtilities Commission ("|PUC' or the 'Commission") for an Order approving the
Firm Energy Sales Agreement between ldaho Power and New Enegy One, LLC ("New
Enerutr) under which New Energy would sell and ldaho Power would purchase electric
energy generated by the Rock Creek Ddry Anaerobic Digester Power Proiect ("Facititf)
located in Cassia County, ldaho.
APPLICATION.l
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ln support of this Application ldaho Power rcprcsents as followp:
I. BACKGROUND
1. Sections 201 and 21A d PURPA, and pertinent regulatiort of the Federal
Energy Regulatory Gommission ('FERC'), require that rcgulated elecilric utilities
purchase power produced by oogenerabrs or small power producers that obtain
qualifiing facility ("QF") status. The purchase price a QF receives fir the sale of its
power is generally rcfened to as the avoided cost rate and is computttd to be equal to
the incremental cost to an electric utility of elec[ic energy or capacity or both, wlrich, but
for the purchase from the QF, such Lrtilfiy wouH generate itsetf or purcfiase from
another source. The Commission has autlrority under PURPA Sections 201 and 21O
and the implementing regulations of the FERC, 18 C.F.R. S 292, to set ryoHed costs, to
order electric utilities to enter into fixed-term obligations for the purchasa of energy ftom
QFs, and to implement FERG's PURPA rules.
II. THE FIRTI ENERGY SALES AGREEUENT
2. On May 24, 2010, ldaho Power and New Energy entered into a Firm
Energy Sales Agreement ('Agreemenf) for the Facility pursuant tcr the terms and
conditions of the various Commission Orders applicable to this PUFFA agreement.
See, Order Nos. 30415, 30488, 30738, and 3074. A copy of ttre Agreement is
enclosed with this Application as Attachment No. 1. The Agreement is for a term of 15
yeafti and contrains the non-levelized published avoided cost mtes esbblished by the
Commission in Order No. 30744 for energy deliveries of less than 10 average
megawatts ("MW").
APPLICATION - 2
3. The nameplate nating of this Facility will be 4 ltilW. As defined in
paragraph 1.21 of the Agreement and as described in panagraph 4.'1.3 of the
Agreement, New Eneqy will be requircd to provide data on the Facility that ldaho
Power will use to mnfirm that under normal and/or average conditions the Facility will
not exceed 10 avemge JvlW on a monthly basis.
4. New Energy has elected a Scheduled Openation Date of December 1,
2012, for the Facility. lf the Facility has not achieved its Openation Date by that date,
Delay Liquidated Damages and associated Delay Security provisions within this
Agreement are applicable.
5. Sec'tion 21.1 of the Agreement provides that the Agrcement will not
become effective until the Gommission has approved all of the Agreement's terms and
conditions and declared that all payments ldaho Power makes to New Enegy for
purchases of enegy will be allowed as prudently incuned expenses for ratemaking
purposes.
6. All applicabte intermnnection study charges under Schedule 72 have
been assessed and oollected fiom New Energy. The final interconnection Feasiblllty
Study is omplete and the final Facility Study for the Facility is undenray. ldaho Power
Power Supply has made application for applicable transmission capacity and has been
notifted that tmnsmission capacity is available
III. APPLICABLE RATEE
7. On March 16, 2010, in Order No. 30125 issued in Case No. GNR-E-10{1,
the Commission adopted new published avoided ost rates for the purchase by ldaho
Power of capacity energy fiom PURPA QFs. The nates adopted in Order No. 31025 are
APPLICATION. S
approximately 10 percent lower than the rates previously adopted in Case No. GNR-E-
09-01, Order No. 30744. By its terms, Order No. 31025 applies to new PURPA
contrac{s executed on and afier March 16, 2010. Because the Agreement is dated May
24,2010, Order No. 31025 would require that the rates to be paid New Energy under
the Agreement would be the nates set out in Order No. 31025 rather than the higher
rates approved by the Commiesion in Order No. 3074,4. However, this Commission has
recognized in prior Orderc that there are situations when QF rates arc changed that it is
appropriate to include a prior vintage of rates in a cunent PURPA contract.l tn several
cases litigated in the early to mid-1990s, the Commission determined, and the ldaho
Supreme Court affirmd, certain criteria that a QF developer must satisff in order to
establish an entitlement to sell energy at a particular published avoided cost nate.2 One
of the criteria that would qualfy a particular generating facility to receive the superseded
rate requires that the developer have executed a power sales agreement wtth the utility
at the rate in question before a suc@ssor rate becomes effective. lf the QF cannot
meet the first criteria, the second criteria requires that prior to the new rates effective
date, the QF developer must have filed a meritorious complaint alleging that the projec{
was sufficiently mature and far enough along in the contracting prccess that but for the
conduct of the utility @mpany, the developer would have been able to sign a contract
with the utility containing the superceded rates.
8. ln this case, New Energy had not signed a contract with ldaho Power to
purchase the Facility generation on or before March 16, 2010. On April 15, 2010, New
t The ldaho Supreme Court has confirmed that it is wi0rin the Commission's jurisdlction to
determine which vintage of QF rates should apply to a PURPA conbact. See Empfre Lumber v.
Washirrytw Water fuwer, 114 ldaho 191, 755 P.2d 1229 (1988) and A.W. Brown Co., lnc., v. ldaho
fuwer @mpany 1 21 ldaho 812, 828 P.zd U1 (1 992).
2 A.W. Brown, Rosab{rd, 131 ldaho.
APPLICATION -4
Energy filed a Complaint at the Commission alleging that it was entitled to 3 contmcts
containing the higher Order No. 30744 rates. Upon further review of the facts, and by
signing this agreement and voluntarily submitting it to the Commissbn, ldaho Power
has concluded that New Energy meets the second test described above and should be
entitled to the rates established by Order No. 30744 in Case No. GNR-E49-01. The
Company has received a number of rcquests for "grandfafiering" of QF orilracts. ln
making a determination to file and support an application uging that a particrlar QF
project is entitled to the Order No. 30744 lates, the Company conduded that a poject
must have met ALL of the following criteria prior to March 16, 2010.
a. lnterconnection and Transmission
plication;and
ii. Received and accepted an intermnnection feasibilSty study
report for the project and paid any requested study deposits (or established credit) for
the next phase of the irilerconnection process in accordance with Schedule 72; and
iii. Received confirmation ftom ldaho Power that transmission
capacity is available fur the proiec{ and/or received and accepted transmission capacity
study results and cost estimates.
b. Purchase PowerAoreement
i. An agreement was materially complete prior to March 16,
2010, ard except for routine ldaho Power final processing, an agreement would have
been executed by both parties priorto March 16, 2010.
9. lt is ldaho Powe/s opinion that the New Enegy Facility meets all of the
above-referenced criteria. With respect to the power purchase agreement criteria, New
APPLICATION.S
Enepy and ldaho Power had resolrred all material outstanding contrac't issues prior to
March 16, 2010. Both parties expectod that final review of the ontract would be a
relatively straighffonrard process. However, in early February, the Company became
aware of some new prccedural requirements from FERC that affected the way that the
Facility would qualify for a Network Resource designation and thereby obtain the
transmission needed to bring the power to be generated by the Facility ftom the
interconnec{ion to the Company load centers. The new procedure required some
changes to the intemal process at ldaho Power. ldaho Power embarked upon
ir:terpreting the regulations and implementing a process to be in compliance. ln ldaho
Power's opinion, the Agreement would have been signed by both parties prior to March
16, 2010, except for the time required by ldaho Power to implement the new intemal
transmission and network resouroe process and, as a lesult, the Facility should qualfi
for a contnact including the Oder No. 30744 rates. New Energy is cunent in all of its
interconnection study payments and so as bng as New Enercy continues to prcvide
requested information in a timely manner and pay invoices on time, it appears that the
interconnection can be completed in time for Nerr Energy to achieve its Scheduled
Operation Date forthe Facilfty
10. The Agreement contains the most recent terms and conditions, including
the liquidated damages and security provisions previously approved by the Commission
in the Arena Drop and the Dry Creek dairy cases, Order Nos. 31060 and 31034,
respectively.
APPLICATION - 6
11. Based on the foregoing, ldaho Power believes that the Agreement meets
the criteria established by the Commission in its prior Ordens and the Commission
should appmve the Agreement as presented.
IV. MODIFIED PROCEDURE
12. ldaho Power believes that a hearing is not neoessary to consider the
issues presented herein and respec{ftrlly requests that this Application be processed
under Modifted Procedure, i.e., by written submissions mther than by hearing. RP 201,
ef seg. lf, however, the Commission determines that a technical hearing is required, the
Company stands ready to present its testimony and support the Application in sucft
hearing.
v. coMi,ruNrcATroNs ABp sERvrcE oF PLEADINGS
13. Communications and service of pleadings, exhibits, orders, and other
documents relating to this proceeding should be sent to the following:
Donovan E. Walker, Senior Counsel
Lisa Nordstrom, Lead Counsel
ldaho Power Company
1221Wesl ldaho Street
P.O. Box 70
Boise, ldaho 83707
[e-mail]
lnordstrom @ idahooower. com
Randy C. Allphin
Energy Contract Ad m inistrator
ldaho Power Company
1221 West ldaho Street
P.O. Box 70
Boise, ldaho 83707
rall ohin@idahooower. com
V!. REOUEST FOR RELIEF
14. ldaho Power Company respeclfi.rlly requests that the Commission issue
an Order: (1) authorizing that this matter may be processed by Modified Procedute; (2)
approving the Firm Energy Sales Agreement between ldaho Power Company and New
Energy One, LLC, without clrange or condition; and (3) declaring that all payments for
purchases of energy under the Firm Energy Sales Agreement between ldaho Potrtler
APPLICATION - 7
Gompany and New Enegy One, LLC, be allowed as pruderilly incuned expenses for
ratemaking purposes.
Reepectfully submitted this 25m day of May 2010.
&zulA
DONOVAN E. WALKER
Attomey for ldaho Power Company
APPLICATION.S
CERTIFICATE OF MALING
I HEREBY CERTIFYthat on the 25h day of 'May 2O1O I served a true and conect
copy of the foregoing APPLICATION upon the tolbwirg named partios by the method
lndlcated below, and addressed to the following:
New Energy Qne, LLC
Attn: Laura lkrothe, PE.
New Energy One, LLC
8720 Vic Lane
Middleton, ldaho 83644
Dean J. Miler
McDEVITT & MILLER LLP
420 West Bannock Street
P.O. Box 2564
Boise, ldaho 83701
_Hand Delivered
X_ U.S. Mail
_olrcmight Mail
FAX
Email
-Hand
DeliveredX U.S. Mail
_Ovemlght lvlai!
_FA)(_ Email [e-mail]
f,
Elonovan E. Walker
APPLICATION. g
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
GASE NO. IPG-E-10-16
IDAHO POWER COMPANY
ATTACHMENT NO. 1
a
FIRM ENERGY SALES AGREEMENT
BETWEEN
IDAHO POWER COMPANY
AND
NEW ENERGY ONE, LLC
TABLE OF CONTENTS
Article TITLE
Definitions
No Reliance on ldaho Power
Warranties
Conditions to Acceptance of Energy
Term and Operation Date
Purchase and Sale of Net Energr
Purchase Price and M€thod of Pal,rnent
Environmental Attributes
Facility and Interconnection
Metering and Telemetry
Records
Operations
Indemnifi cation and Insurance
Force Majewe
Liabitty Dedication
Several Obligations
Waiver
Choice of Laws aad Verue
Disputes and Default
Governme, rtal Authorization
Cornmission Order
Successors and Assigns
Modification
Taxes
Notices
Additionat Terrrs and C;onditions
Severability
Counterparts
Entire Agreement Signatures
1
2
3
4
5
6
7
8
9
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t3
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l5
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l8
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20
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23
24
25
26
27
28
29
Appendix A
Appendix B
Appendix C
Appendix D
FIRM ENERGY SALES AGREEMENT
(10 aMW orLess)
Project Name: Rock Creek Dairy
Project Number: 3l616l l0
THIS AGREEMENT, entered into on tnrsfit aay of yhA? 2010 betrneen NEW ENERGY
ONE, LLC, an Idaho limited liability company (Seiler), and IDAHO POWER COMPANY, m Idaho
corporation (Idaho Power), hereinafter sometimes referred to collectively as "Parties" or individually as'?arty."
WITNESSETH:
WIIEREAS, Seller will design, construct, own, maintain and operate an electric generation facility; and
WHEREAS, Seller wishes to sell, and Idaho Power is willing to puchase, firm electric enerry produced
by the Seller's Facility.
TIfiREFORE, In consideration of the mutual coyenants and agreenrents hereinaftsr set forth, the
Parties agr€e as follows:
ARTICLE I: DEFTNTTIONS
As used in this Agreement and the appendices attached hereto, the following terms
shall have the following meanings:
1.1 "Base-Egglg" - Monthly Net Energy less than I lPo of tbe monthly Net Enerry Amount as specified
in paragraph 6.2 of this Agreement.
1.2 "Commiggi@" - The Idaho Public Utilities Commission.
I.3 "Contract-Yeat'' - The p€riod commencing each caleirdar year on the same calendar date as the
Operation Date and ending 364 days thereafter.
1.4 "Delay Liquidate4 Darnages" - Damages payable to Idaho Power as calculated in paragraph 5.3,5.4,
5.5, 5.6 and 5.8.
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1.5 "Dg!gy-8dgd" - All days past the Scheduled Operation Date until the Seller's Facility achieves the
Operation Date.
"Dglo@ce" - The etrrrent month's Mid-Columbia Market Energy Cost minus the current nmnth's All
Hours Energr Frice qpecified in paragraph 7.3 of this Agreement. If this calculation results in a value
less than 0, the result of this calculation will be 0.
"Designated Disp4tch Facilitv" - Idaho Power's Systeurs Operations Group, or any subsequent group
designated by Idaho Power.
"Eggili{" . That electric generation facilrty described in Appendix B of this Agreement.
"@EIy-Dg&o - The day commencing at 00:01 hours, Mountain Time, following the day that
Seller has satisfied the requireme,nts of Article IV and tbe Seller begins delivering energy to Idaho
Power's sysiem at the Point of Delivery.
"Ilg$ry-Load-Egug" - The daily hours beginning at7:00 am, ending at I 1:00 pm Mormtain Time, (16
hours) excluding all horus on all Sundays, New Years Day, Memorial Day, Independence Day, Labor
Day, Thanksgrving and Christmas.
'iln4d@g@[''- Electric energy Seller does not inteod to generate. Inadvertent energy is more
particularly described in paragraph 7.5 of this Agreement.
nlnte{connection Facilities" - All equipment specified in Schedule 72.
"lnitial Capacitv Detemrinatiot''.- The process by which Idaho Power confirms that under normal or
average design conditions the Facility will geiremte at no more than l0 average MW per month aod is
therefore eligible to be paid the published rates in accordance with Commission Order No. 29632.
"Li&-Load-@" - The daily hours begnning at I l:00 pnr, ending at 7:00 am Mormtain Time (8
hours), plus all otherhours on all Sundays, New Years Day, Memorial Day, Independence Day, Labor
Day, Thanksgiving and Christmas.
"Lggseg" - The loss of electrical energy expressed in kilowatt houn (kwh) occuning as a result of the
transformation and transmission of energy between the point where the Facility's enerry is metered and
the point the Facility's energy is delivered to the Idaho Power electrical systern. The loss calculation
formula will be as specified in Appendix B of this Agreement.
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1.6
1.7
1.8
1.9
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1.1 I
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1.16 "Market Energ.v Reference Price" - Eighty-five percent (857o) of the Mid4olumbia Market Energy
Cost.
l.L7 "MateridB!9ach" - A Default (paragraph 19.2.1) subject to paragraph 19.2.2.
1.18 "Maximum Capacitv Amounf'- The maximum capacity (MW) of the Facility will be as specified in
Appendix B of this Agreement.
l.l9 "Metering-EgipEEt". - All equipment specified in Schedule 72, this Agreement and any additional
equipment specified in Appendix B required to measure, record and telemeter bi directionol power
flows between the Sellet's elechic generation plant and [daho Powet's system.
1.20 "Mid- Columbia Mqrket Enery Cost" - The monthly *eighted average of the daily on-peak and off-
peak Dow Jones Mid€olumbia Index (Dow Jones Mid-C Index) prices for non-firm energy. If the Dorv
Jones Mid{olumbia lndex price is discontinued by the reporting agercy, both Parties will muhrally
agree upon a replacement index, which is similar to the Dow lones Mid{olumbia lndex. The selected
replacement index will be consistent with other similar agreemeats and a cormronly used index by the
elechical industry.
1.21 "I&D0ghE-oqlagi8'-The full-load elechical quantities assigned by the designer to a generator and its
prime mover or other piece of elecnical equipment such as tansformers and circuit breakers, under
standardized conditions, expressed in amperes, kilovolt-amperers, kilowatts, volts or other appropriate
units. Usually indicated on a narneplate attached to the individual machine or device.
1.22 "Ngt XneIS" - All of the electic enerry produced by the Facility, less Station Use, less Losses,
expressed in kilowatt hols (kWh). Subject to the terms of this Agreemen! Seller commits to deliver all
Net Energr to ldaho Power at the Point of Delivery for the full term of the Agreement. Net Enerry does
not include Inadvertent Energy.
1.23 "Qperatigg-&!9" - The day commencing at 00:01 horus, Mountain Time, following the day that all
requirements of paragraph 5.2 have been completed.
1.24 "Pqint of Deliygy" - The location specified in Appendix B, where ldaho Power's aod the Seller's
electrical facilities are interconnected and the energy from this Facility is delivered to the Idaho Power
electrical system.
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1.25 "Prudpnt Electrical Practices" - Those practices, methods and equipment that are commonly and
ordinarily used in electrical engineering and operations to operate electric equipment lawfully, safely,
dependably, efficiently and economically.
L.26 "scheduled Operation Date" - The date specified in Appendix B when Selleranticipates achieving the
Operation Date. It is expected that the Scheduled Operation Date provided by the Seller shall be a
reasonable estimate of the date thaf the Seller anticipates that the Seller's Facility shall achieve the
Operation Date.
1,27 "schedule 72- - Idaho Power's TariffNo l0l, Schedule 72 or its successor schedules as approved by
the Commission. The Seller shall be responsible to pay all costs of interconnection and integration of
this Facility into the Idaho Power electrical slatem as specified within Schedule 72.
1.28 "Season" - The three periods ideNrtified in pragraph 6.2.1 of this Agreement.
1,29 "SDggieL Facilities'. - Additions or alterations of bansmission and/or disfribution lines and hansformen
as described in Schedule 72.
1.30 "statisa-IJsg" - Electric eoergy that is used to operate equipment that is auxiliary or othenvise related to
the prcduction of elecficity by the Facility.
1.31 "S.t&!ug Egerry" - Is (l) Net Enugy produced by the Seller's Facility and delivered to the Idaho Power
electrical system during the month which exceeds 1Ifflo of the monthly Net Energy Amount for the
corresponding month specified in paragraph 6.2. or (2) If the Net Eaergy produced by the Seller's
Facility and delivered to the Idaho Power electrical system during the month is less than 9fflo of the
monthly Net Energy Amormt for the corresponding month specified in paragraph 6.2, the,n all N*
Energy delivered by the Facility to the ldaho Power electrical system for that given month or (3) All Net
Energy produced by the Seller's Facility and delivered by the Facility to the ldaho Power electrical
system prior to the Operation Date.
1.32 "Total Cost of the Facility" . The total cost of sfiuctures, equipment and appurtenances.
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2.1
2.2
3.r
3.2
4.1
ARTTCLE tr: NO RELTANCE ON rDAHO pO. WER
Seller Indeppndent Investigation - Seller wanants and represents to Idaho Power that in entering into
this Agreement and the undertaking by Seller of the obligations set forth herein, Seller has investigated
and determined that it is capable of performing hereunder and has not relied upon the advice,
experience or expertise of Idaho Power in connection with the transactions conternplated by this
Agreement.
Seller Indepeodernt E:coerts - All professionals or experts including, but not limited to, engineers,
attorneys or accoultants, that Seller may have consulted or relied on in undertaking the hansactions
conterplated by this Agreement have been solely those of Seller.
ARTICLE III: WARRANTES
No Wanantv ty lOano power - Any review, acceptance or failure to review Seller's desigp,
specifications, equipment or facilities shall not be an endorsement or a confirmation by ldaho Power and
I,laho Power makes no wananties, expressed or implied, regarding any aspect of Seller's desigrq
specifications, equipment or facilities, including, but not limited to, safety, durability, retiability,
shength, capacity, adequacy or economic feasibility.
Quali&ing Facility Status - Seller warrants that the Facility is a "Qualifting Facility," as that term is
used and defined in 18 CFR 292.201et seq. After initial qualification, Seller will take such steps as may
be required to maintain the Facility's Quali$ing Facility status during the term of this Agreement and
Seller's failrre to maintain Quali&ing Facility status will be a Material Breach of this Agreement.
Idaho Power reserves the right to review the Facility's Qualiffing Facility status and associated .,rp,p"rt
and compliance documents at anytime during the terrr of this Agreement.
ARTICLE TV: CONDITIONS TO ACCEPTANCE OF ENERGY
Prior to the First Energy Date and as a condition of ldaho Power's acceptance of deliveries of enerry
from the Seller rmder this Agreement Seller shall:
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4.1.1 Submit proof to Irlqho Power that all licenses, permits or approvals necessary for Seller's
operatiops have been obtained from applicable federal, state or local authorities, including but
not limited to, evidence of cornpliance with Subpart B, l8 CFR 292,201 et seq. as a certified
Qualifying Facility.
4.1.2 Qpinion of Cormsel - Submit to Idaho Power ao Opinion I.etter signed by an atorney admitted
to practice and in good standing in the SAte of Idatro providing an opinion that Seller's licenses,
permits and approvals as set forth in paragraph 4. I .l above are legally and validly issue{ are
held in the name of the Seller and, based on a reasonable independent review, counsel is of the
opinion that Seller is in substantial corpliance with said permits as of the date of the Opinion
Letter. The Opinion I*tter will be in a form acceptable to Idaho Power and will acknowledge
that the attorney rendering the opinion understan<ts that ldaho Power is relying on said opinion
Idaho Power's acceptance of the form will not b€ unreasonably withheld. The Opinion Letter
will be governed by and shall be interpreted in accordance with the lepl opinion accord of the
American Bar Association Section of Business Law (1991).
4.1.3 Initial Capacity Determination - Submit to ldaho Power such data as Idaho Powermay
reasonably require to perform the Initial Capacity Detcrrrination. Such data will include but not
be limited to, Nameplate Capacity, equipment specifications, prime mover data, resource
characteristics, nornul and/or average operating design conditions and Station Use data. Upon
receip of this informatioa, Idaho Power will review the provided data Ird if necessary, request
additional data to complete the Initial Capacity Determination within a reasonable time.
4.1.3.1 If the Maximum Capacity specified in Appendix B of this Agreement and the
cumulative manufacture Nameplate Capac$ rating of the individual generation units at
this Facitity is less than t0 MW. The Seller shall submit detailed, manufacturer,
verifiable data of the Nameplate Capacity ratings of the actual individual generation
units to be installed at this Facility. Upon verification by Idaho Power that the data
provided establishes the combined Nameplate Capacrty rating of the generation units to
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4.1.4
4.r.5
4.1.6
4.1.7
4.1.8
4.1.9
be installed at this Facility is less than 10 MW, it will be deemed that the Seller has
satisfied the Initial Capacrty Deterrrination forthis Facility.
Name,plate Capacitv - Submit to Idaho Power manufacturer's and engineering documentation
that establishes the Nameplate Capacity of each individual generation unit that is included
within this entire Facility. Upon receipt of this data, Idaho Power shall review ths provided data
and determine if the Namcplate Capacity specified is reasonable based upon the manufacturcr's
specified generation ratings for the specific generation units.
Engineet',s Certifications - Submit an exectrted Engineer's Certification of Design &
Construction Adequacy and an Engineer's Certification of Operatioos and Maintemnce (O&lvf)
Policy as described in Commission Order No.21690. These certificates will be in the form
specified in Appendix C but may be modified to the extent necessary to recognize the different
engineering disciplines providing the certificates.
Insurance - Submit written proof io Idaho Power of all instrance required in Article XI[.
Intefconnectipn - Provide written conlinnation from ldaho Power's delivery business unit that
Seller bas satisfied oll interconnection rcquirements.
Network Resource Desienation - The Seller's Facility has been designated as a network
resource capable of delivering firm energy up to the amount of the Maximum Capacity.
Written Acce,pt4nce - Request and obtain written confinnation from Idaho Power that all
conditions to acce,ptance of enerry have been fulfilled. Such written confimration shall be
provided within a commercially reasonable time following the Seller's request and will not be
rmreasonably withheld by Idaho Power.
5.1
ARTICLE V: TERM AND OPEMTION DATE
Terrr - Subject to the prcvisions of paragraph 5.2 below, this Agreernent shall become effective on the
date first written and shall continue in full force and effect for a period of 15 (not to exceed 20 years)
Contract Years from the Operation Date.
-7-
5fig/2010
5.2 Opergtion Date - The Operation Date may occur only after the Facility has achieved all of the following:
a) Achieved the First Enerry Date.
b) Cornmission approval of this Agreement in a form acceptable to Idaho Power has been
received.
c) Seller has dernonsfated to Idaho Power's satisfaction that the Facility is complete and able
to provide energ5t in a consistent, reliable and safe nranner.
d) Seller has requested an Operation Date from Idaho Power in a wrinen format.
e) Seller has received written confirmation from Idaho Power of the Operation Date. This
confirmation will not be unreasonably withheld by Idaho Power.
5.3 Operation Date Delay - Seller shall cause the Facility to achieve the Operation Date on or before the
Scheduled Operation Date. Delays in the interconnection and transmission upgrade shrdy, design
and constrtrction process that ggggq[ Force Majeure events accepted by bo0r Parties, Snan nog prevent
Delay Liquidated Damages from being due and owing as calculated in accordance with this Agreement.
5.3.1 If the Operation Date oscurs after the Scheduled Operation Date but on or prior to 90 days
following the Scheduled Operation Date, Seller shall pay Idatro Power Delay Liquidated
Damages calculated at the end of each calendar month after the Scheduled Operation Date as
follows:
Delay Liquidated Damages are equal to ((Cureot month's Initial Year Net Energy
Amount as specified in paragraph 6.2.1 dividd by the number of days in the cunent
month) multiplied by the number of days in the Delay Paiod in the current month)
multiplied by the curre, rt month's Delay Price.
5.3.2 If the Operation Date does not occur withitr ninety (90) days following the Scheduled Operation
Date the Seller shall pay Idaho Power Delay Liquidatert Damages, in addition to those provided
in paragraph 5.3.1, calculated as follows:
Forty five dollars ($45) multiplied by the Maximum Capacity with the Ma:rimum
Capacity being rneasured in kW.
5.4 If Seller fails to achieve the Operation Date within ninety (90) days following the Scheduled Operation
- 8-
s^grzoro
5.5
5.6
5.7
Date, such failure will be a Material Breach ad Idaho Power may termirate this Agreeme,nt at any time
until the Seller cures the Material Breach. Additional Delay Liquidated Damages beyond those
calculated in 5.3.1 and 5.3.2 will be calculated and payable using the Delay Liquidated Damage
calculation described in 5.3.1 above for all days exceeding 90 days past the Scheduled Operation Date
until such time as the Seller cures this Material Breach or Idaho Power temrirates this Agreeurent.
Seller shall pay ldaho Power any calculated Delay Damages or Delay Liquidated Damages within 7
days of when Idaho Power caloulates and presents any Delay Damages or Delay Liquidated Domages
billings to the Seller. Seller's failure to pay these damages within the specified time will be a Material
Breach of this Agreement and Idaho Power shall draw funds from the Delay Secun-ty provided by the
Seller in an amount equal to the calculated Delay Damages or Delay Liquidated Damages.
The Parties agree that the damages Idaho Power would incu due to delay in the Facility achieving the
Operation Date on or before the Scheduled Operation Date would be diffrcult or impossible to predict
with certainty, and that the Delay Liquidakd Damages are an appropriate approximation of such
damages.
Frior to the Seller executing this Agreemen! the Seller shall have agreed to and executed a Letter of
Understanding with Idaho Power that contains at minimum the following requirements:
a) Seller has filed for interponnection and is in conpliance with alt paymeuts and
requirements of the interconnection process
b) Seller has received and accepted an interconnection feasibility study for this
Facility.
c) Seller has provided all information required to enable Idaho Power to file an initial
transmission capacity request.
d) Results of the initial transmission capacity request are known and acceptable to the
Seller.
e) Seller acknowledges responsibility for all interconnection costs and any cosb
associated with acquiring adequate firm transmission capacity to enable the project
to be classiffed as an ldaho Power firm network resource.
-9-
5n9/2010
5.8
0 If the Facility is located outside of the Idaho Power service territory, in addition to
the above requirenoents, the Seller must provide evidence that the Seller has
acquired firm tansmission capacity from all required hansmitting entities to deliver
the Facility's energy to an acceptabte point of delivery on the Idaho Power
elechical system.
Within thirty (30) days of the date of a final non-appealable order as specified in Article X)(I approving
this Agreement the Seller shall post liquid security ("Delay Sectrity') in a form as described in
Appendix D equal to or exceeding the amount calculated in paragraph 5.8.1.
5.8.1 Dslpy Security The greater of forty five ($45) multiplied by the Maximum Capacity with the
Maximum Capacity being measured in kW or the sum of three month's estimated revenue.
Where the estimated three months of reveru€ is the estimated revenue associated with the first
three full rronths following the estimated Scheduled Operation Date, the estirnated kWh of
enerry production as specified in paragraph 6.2.1 for those three nronths multiplied by the All
Hours Energy Price specified in paragraph 7.3 for each of those three months.
5.8.1.1 In the event (a) Seller provides Idaho Power with certification that (l) a generation
interconnection agreement speciffing a schedule that will enable this Facility to achieve
the Operation Date no later than the Scheduled Operation Date has been completed and
the Seller has paid all required interconnection costs or Q) ageneration interconnoction
agreement is substantially complete and all material costs of interconnection have been
identified and agreed upon and the Seller is in compliance with all terms and
conditions of the generation interconnection agreemenl the Delay Security calculated
in accordance with paragraph 5.8.1 will be reduced by ten percent (Itrlo).
5.8.1.2 If the Seller has received a reduction in the calculated Delay Security as specified in
paragraph 5.8.1.1 and subsequently (l) at Seller's request, the generation
interconnection agreement specified in paragraph 5.8.1.1 is revised and as a rezult the
Facility will not achieve its Opcration Date by the Scheduled Operation Date m (2) if
the Seller does not maintain corryliance with the generation interconnection agreement"
- lo-
sngt2olo
the full amount of the Delay Security as calculated in paragrryh 5.8.1 win be subject to
reinstaJement and will be due and owing within 5 business days from the date Idaho
Power requests reinstatement. Failury to timely reinstate the Delay Security will be a
Material Breach of this Agreement.
5.8.2 Idaho Power shall release any renraining security posted hereunder after all calculated Delay Damages
and/or Delay Liquidated Damages are pald in full to Idaho Power and the earlier of (l) 30 days after the
Operation Date has been achieved or (2) 60 days after the Agreemeut has been terminated.
ARTICLE VI PTJRCHASE AND SALE OF NET ENERGY
6.1 Delivery and Agceptance of Net Enerey - Except when either Partyrs performance is excused as
provided her:ein, Idaho Power will prnchase and Seller will sell all of the Net Enerry to Idaho Power at
the Point of Delivery. All Inadvertent Enerry produced by the Facility will also be delivered by the
Seller to Idaho Power at the Point of Delivery. At no time will the total amount of Net Ener-gy and/or
Inadvertent Energy produced by the Facility and delivered by the Seller to the Point of Delivery ux"""A
the Maximum Capacrty Amount.
Net Eaemy Amounts - Seller intends to produce and deliver Net En€rgy in the following monthly
amounts:
- I l-
st$12arc
6.2
6.2.1 Initial Year Monthly Net Energ.v Arnormts:
Month
Season 1
Season 2
July
August
November
Dece,mber
June
September
October
January
February
kwh
1,296,000
1,296,000
1,296,000
1296,000
1296,000
1,296,000
1,296,000
1,296,000
1,296,000
1296,000
1,296,W
1,296,000
March
April
May
6.2.2
6.2.3
Season 3
Ongoing Monthly Net Energ[, Amormts - Seller shall initially provide Idaho Porrer with ooe
year of monthly generation estimates (Initial Year Monthly Net Enogl Amounts) and
beginning at the end of month nine and every three months thereafter provide Idaho Power with
an additional three months of forward generation estimates beyond those geaeration estimates
previously provided. This information will be provided to Idaho Power by wri{en notice in
accordance with paragraph 25.1, no later than 5:00 PM of the 5e day following the Cnd of the
previous month. If the Seller does not provide the Ongoing Monthly Net Energy Amormts it a
timely maoner, Idaho Power will use the most recent 3 months of the Initial Year Monthly Net
Energy Amounts specified in paragraph 6.2.1 for the next 3 rnonths of rmnthly Net Energy
amounts.
Seller's Adiustrnent of Net EnerEy Amount
6.2.3.1 No later than the Operation Date, by written notice given to Idaho Power in accordance
with paragraph 25.1, the Seller may revise all of the previously provided Initial Year
Monthly Net Energy Arnounts.
6.2.3.2 Beginning with the end of the 9th month after the Operation Date and at the end of
every third rnonth thereafter: (l) the Seller may not revise the immediate next three
- 12_
5/t912010
6.2.4
montls of previously provided Net Energy Amounts, (2) but by written notice given to
Idaho Power in accordance with paragraph 25.1, no later than 5:00 PM of thrc 5* day
following the end of the previous month, the Seller may revise all other previously
provided Net Enerry Amounts. Failure to provide timely written notice of changed
amounts will be dee'med to be an election of no change.
Idaho Power Adjustnrent of Net Energy Amount - If Idaho Power is excused from accepting the
Seller's Net Energy as specifiod in paragraph 12.2.1 or if the Seller declares a Suspeasion of
Enerry Deliveries as specified in paragraph 12.3.1 and the Seller's declared Suspension of
Energy Deliveries is accepted by Idaho Power, the Net Enerry Amount as specified in
paragraph 6.2 fpr the specific month in which the reduction or suspension under paragpiph
12.2.1 or 12.3.1 occtns will be reduced in accordance with the following:
Where:
NEA = Current Month's Net Energy Amount (Paragraph 6.2)
SGU :a.) If Idaho Power is excused from accepting the Seller's Net
Energy as specified in paragnph 12.2.1 this value will be
equal to the percentage of curtailme,nt as specified by
Idaho Power multiplied by the TGU as defined below.
b.) If the Seller declares a Suspension of Enerry Deliveries as
specified in paragraph 12.3.1 this value will be the sum of
the individual generation rmits size ratings as specified in
Appendix B that are impactd by the circumstances
causing the Seller to declare a Suspension ofEnergy
Deliveries.
TGU Sum of all of the individual generator ratings of the generation
units at this Facility as specified in Appendix B of this
agreement.
RSH : Actual hours the Facility's Net Energy deliveries were either
reduced or suspended under paragraph 12.2.1 or 12.3.1
= Actual total hours in the current month
- 13-
5lt9l20t0
TH
Resultins formula beine:
Adiusted
Nei rnergr = NEA
Amount ))((X NEA x)(THTGU
6.3
7.1
This Adjusted Net Energy Amount will be usd in applicable Surplus Energr calculations for only the
specific month in which Idaho Power was excused from accepting the Seller's Net Energy or the Seller
declared a Suspension of Enerry.
Unless excused by an event of Force lv{ajeure, Seller's failure to deliver Net Energy in my Contract
Year in an amount equal to at least ten percent (lW/o) of the sum of the Initial Year Net Energ5r
Amounts as spocified in paragraph 6.2 shall constitute an event of default.
ARTICLE VII PIJRCHASE PRICE A}ID METHOD OF PAYMENT
Base Energv HeaW t oad Ptuchase Price - For all Base Energy received during Heavy l,oad Hours,
Idaho Fower will pay the non-levelized energy price in accordance with Comnission Order 3074,
30738 and a{usted in accordaoce with Commission order 30415 for Healy Load Hour Energy
deliveries with seasonalization factors applied:
Yeer
2010
20tt
2012
20t3
2014
2015
2016
2017
2018
20t9
2020
2A2r
2022
2023
2024
2025
2026
2027
Season I -(73.50Yo)
Milldkwh
57.98
59.s4
6t.22
62.62
il.05
65.52
67.10
68.63
70.29
71.9t
73.56
75.26
76.99
78.78
80.60
82.47
84.75
87.10
Season 2 -(l2O.A0oA
Milsn(Wh
94.67
97.21
99.9s
r02.23
r0/'.57
106.97
109.55
I12.05
114.77
tt7.40
120.10
122.87
125.70
128.61
131.59
r34.65
138.37
t42.21
Season3-(100.0070)
Miilykwh
78.89
81.01
83.29
85.19
87.14
89.14
91.29
93.38
95.il
97.83
100.08
tw.39
1M.75
107.18
109.66
n2.21
115.31
118.51
- t4-
5lt9t20n
2028
2A29
2030
2031
89.53
92.03
94.@
96.69
146.17
150.25
154.45
157.85
12r.81
125.2t
t28.71
131.55
7.2
7.3
Year
2010
zott
2An
2013
2014
20t5
2016
2017
2018
20t9
2020
202r
za22
2023
2024
2025
2026
2027
2428
2029
2030
2031
Base Enerry I-ieht Load Purchase Price - For all Base Energy received dwing Light Load Hours, Idaho
Power will pay the non-levelized energy price in accordance with Commission Order 307U,30738 and
adjusted in accordance with Comnission Order 3M15 for Light Load Hour Enerry deliveries with
seasonalization factors apptied :
Season I - (73.50Yo)
Milts/kWh
52.63
54.19
55.87
57.27
58.70
60.17
61.75
63.28
64.94
66.56
68.21
69.90
7t.il
73.42
75.25
77.12
79.44
81.75
84.18
86.68
89.25
91.33
Season 2 - (l20.0fl.o/o\
Mitls/kWh
85.93
88.47
9t.2t
93.49
95.83
98.23
100.81
r03.32
106.03
108.66
I I1.36
I14.13
116.97
I19.88
t22.86
r25.91
t29.il
133.48
137.43
141.51
145.71
149.t2
Season3 -(100.007o)
Milts/kWh
71.6t
73.73
76.01
77.91
79.86
81.86
84.01
86.10
88.36
90.55
92.80
95.1I
97.47
99.90
102.38
104.93
108.03
nt.23
114.53
r17.93
t21,43
124.27
All Honrs Energ.v Price - The price to be used in the calculation of the Surplus Energy Price and Delay
Damage Price shall be the non-levelized energy price in accordance with Commission Order 3A744 aad
30738 with seasonalintton factors applied:
- 15-
sl19t2010
Year
2010
20ll
20t2
20t3
2014
2015
2016
20t7
2018
2A19
2020
2021
2022
2023
2024
202s
2026
2027
2028
2029
2030
203t
Season l -(73.50%)
Milldkwh
55.60
57.16
58.84
60.u
61.67
63.14
@.72
66.25
67.9t
69.53
71.18
72.87
74.61
76.39
78.22
80.09
82.37
84.72
87.15
89.64
92.22
94.30
Season2 -(120.00n
Mlllvkwh
90.78
93.32
96.06
98.34
100.68
103.08
105.66
108.17
I10.88
113.51
116.21
l18.98
121.82
t24.72
127.7r
130.76
134.49
138.32
142.28
146.36
150.56
153.97
Season3 -(100.0070)
M,ills/kWh
75.65
77.77
80.05
81.95
83.90
85.90
88.05
90.14
92.N
94.59
96.M
99.15
101.51
103.94
106..42
108.97
112.07
115.27
118.57
121.97
125.47
128.31
7.4
7.5
Surplus Enerry Price - For all Surplus Energy, Idaho Power shall pay to the Seller the current monthf s
Market Enerry Reference Price or the All Hours Eoerry Price specified in paragraph 7.3, whichever is
lower.
Inadvertent Enerey-
7.5.1 Inadvertent Energ5r is elecnic energy produced by the Facility, expressed in kWh, which the
Seller delivers to Idaho Power at the Point of Delivery that exceeds 10,000 kW multiplied
by the hours in the specific month in which the energy was delivered. (For example
January contains 744 hours. 7zl4 hqns times 10,000 kW :7,4!9,000 kWh. Eaergy
delivered in January in excess of 7 ,440,000 kWh in this example would be kradvertent
Energy.)
7.5.2 Although Seller intends to desigrr and operate the Facility to generate no more than
10 average MW and therefore does not intend to generate Inadverte,nt Energr, Idaho Power
- 16-
s^stzoro
7.6
will accept Inadvertent Enerry that does not exceed the Maximum Capactty Amount but
will not purchase or pay for Inadvertent Energ5l.
Payment Due Date - Undiqputed Enerry payments, less any payments due to Idaho Power will tle
disbursed to the Seller within 30 days of the date which Idaho Power receives and accepts the
documentation of the monthly Net Energy actually delivered to Idaho Power as specified in
Appendix A.
Continuing Jurisdiction of the Commission.This Agreement is a special contact anq as sucho the rates,
terms and conditions contained in this Agreement will be construed in accordance with Idaho Power
Company v. ldaho Public Utilities Coqmission and Afton Energy. Inc., 107 Idaho 781, 693 P.zd 427
(l9M), Idaho Power Compaoy v. Idaho Public Utilities Commission 107 Idaho ll22,695 P.Zd | 261
(1985), Afton Energy. Inc. y. I-daho Power Company, I l1 Idaho g25,72gP.2d 400 (1986), Section 2lO
of the Public Utilities Regulatory Policies Act of 1978 and 18 CFR $292.303'308
ARTICLE VIII ENVIRONMENTAL ATTRIBUTES
Seller retains tmder this Agreement of Green Tags and Renewable Energy Certificates
(RECs), or the equivalent environmental attributes, directly associated with the production of energy
from the Sellet's Facility sold to Idaho Power.
ARTICLE D(: FAQIL.ITY A}.ID INTE, RCONNECTION
Design of FacjliE - Seller will design, constnrct, install, own, operate and maintain the Facility and any
Seller-owned Interconnection Facilities so as to allow safe and reliable generation and delivery of Net
Energy and Inadverteut Energy to the Idaho Power Point of Delivery for the full term of the Agreement.
7.7
8.1
9.1
ARTICLEX: METERING AND TELEMETRY
l0.l Metering - Idaho Power shall, for the account of Seller, provide, install, and maintain Metering
Equipment to be located at a mutually agreed upon location to record and measure power flows !o Idaho
Power in accordance with this Agreement and ScheduleT1. The Metering Equipment will be at the
- 17-
5n9t20t0
location and the ffi required to measure, record and report the Facility's Net Energy, Station Use,
Inadverte,lrt Energy and maximum enerry deliveries (kW) at the Point of Delivery in a rnanner to
provide ldaho Power adequate energy meastrement data to administtr this Agreernent and to integrate
this Facility's energy production into the Idaho Power electrical system.
lO.2 Telemetr.v - Idaho Power will install, operate and maintain at Selleds expense communicatiotrs and
telemeky equipment which will be capable of providing Idaho Power with continuous instantaneous
telemetry of Sellet's Net Energy and Inadvertent Enerry produced and delivered to the Idaho Power
Point of Delivery to Idaho Poweds Designated Dispatch Facility.
I LI Mainte ,nance of Records - Setler shall maintain at the Facility or such other location mutually acc€pftfile
to the Parties adequate total generation, Net Enerry, Station Use, Inadvertent Enerry and maximum
generation (kW) records in a form and content acceptable to ldaho Power.
ll.2 Inspection - Either Party, after reasonable notice to the other Party, shall have the right, during normal
business hours, to inspect and audit any or all generation, Net Energy, Station Use, lnadvertent Energy
and maximum generation ftW) records pertaining to the Seller's Facility.
t2.L
12.2
ARTICLE XII: OPERATIONS
Communications - Idaho Power and the Seller shall maintain appropriate operating communications
through Idaho Power's Designated Dispotch Facility in accordance with Appendix A of this Agreement.
Enersv Acceotance -
L2.2.1 Idaho Power shall be excrised from acce,pting and paying for Net Enerry or acceping
Inadvertent Energy which would have otherwise been produced by the Facility and deliveted by
the Seller to the Point of Delivery, if it is prevented from doing so by an event of Force
Majeure, or temporary disconnection of the Facility in accordance with Schedule 72. It for
reasons other than ao event of Force Majeure, a temporary disconnection under Schedute ?2
exceeds twenty (20) days, beginning with the twenty-first day of such intemrption, curtailment
' - 18-
5figr2o.o
r2.2.2
12.2.3
12.2.4
or reduction, Seller will be deemed to be delivering Net Energy at a rals equivalent to the pro
rata daily average of the amounts specified for the applicable month in paragraph 6.2. Idaho
Power will notiff Seller when the intemrption, curtailment or reduction is lerminated.
If, in the reasonable opinion of Idatro Power, Seller's operation of the Facility or Interconnection
Facilities is nnsafe or may otherwise adversely affect Idaho Powet's equipment, personnel or
service to its customers, Idaho Power may temporarily disconnect the Facility from Idaho
Power's transmission/dishibution system as specified within Schedule 72 ot take such other
reasonable steps as Idaho Power deems appropriate.
Under no circrunstances will the Seller deliver Net Energy and/or Inadvertent Enerry from the
Facility to the Point of Delivery in an amount that exceeds the Maximum Capacity Arnount.
Seller's failure to limit deliveries to the Maximum Capacity Amount will be a Material Breach
of this Agreement.
If Idaho Power is unable to accept the energy from this Facility and is not excused from
accepting the Facility's energy, Idaho Power's damages shall be limited to only the value of the
estimated energy that Idaho Power was unable to accept. Idaho Power will have no
responsibility to pay for any other costs, lost revenue or consequential damages the Facility may
12.3
lncur
Seller Declared Susppnsion of EnerEv Deliveries
12.3.1 If the Seller's Facility experiences a forced outage due to equipment failure which is not caused
by an event of Force Majerne or by neglect, disrepair m lack of adequate preventative
maintenance of the Seller's Facility, Seller may, after giving notice as provided in paragraph
12.3.2 below, temporarily suspend all deliveries ofNet Energy to Idaho Power from the Facility
or from individual generation unit(s) within the Facility irnpacted by the forced outage for a
period of not less than 48 hours to correct the forced outage condition ('Declared Suspension of
Energy Deliveries"). The Seller's Declared Suspension of Energy Deliveries will begin at the
start of the next full hour following the Seller's telephone notification as specified iu paragraph
12.3.2 and will continue for the time as specified (not less than 48 hours) in the writtert
- 19-
5lt9/2010
notification provided by the Seller. In the month(s) in which the Declared Suspension of Energy
occurred the Net Energy Amormt will be adjusted as specified in pqragraph 6.2.4.
12.3,2 If the Seller desires to initiate a Declared Suspension of Enerry Deliveries as provided in
parasaph 12.3.1; the Seller will notify the Designated Dispatch Facility by telephone. The
beginning hour of the Dsclared Suspension of ErergA Deliveries will be at the earliest the next
full hour after making telephone contact with Idaho Power. The Seller will, within 24 hours
after the telephone contact, provide ldaho Power a written notice in accordance with )OilV that
wilt contain the beginning hour and duration of the Declmed Suspension of Energr Deliveries
and a description of the conditions that caused the Seller to initiate a Declared Suspeirsion of
Energy Deliveries. Idaho Power will review the docurrentation provided by the Seller to
determine Idaho Power's acceptance of the described forced outage as qualiffing for a Declared
Suspension of Enerry Deliveries as specified in paragraph 12.3.1. Idaho Power's acceptance of
tle Seller's forced outage as an acceptable forced outage will be based upon the clear
documentation provided by the Seller that the forced outage is not due do an event of Force
Majeure or by neglect, disrepair or lack of adequate preventative rnaintenance of the Seller's
Facility.
12.4 Scheduled ,Maintenance - On or before January 3l of each calendar year, Seller shall submit a written
proposed maintenance schedule of significant Facility maintenance for that calendar year and Idaho
Power and Seller shall mutually agree as to the acceptability of the proposed schedule, The Parties
determination as to the acceptability of the Seller's timetable for scheduled maintenance will take into
consideration Prudent Electical Practices, Idaho Power system requirernents and the Seller's preferred
schedule. Neither Party shall unreasonably withhold acceptance of the proposed maintenance schedule.
12,5 Maintenance Coordination - The Seller and ldaho Power shall, to the extent practical, coordin*e their
respective line and Facility maintenance schedules such that they occur simultaneously.
12.6 Contact Prior to CurtaiLnent - Idaho Power will make a reasonable attempt to contact the Seller prior to
exercising its rights to intemrpt interconnection or curtail deliveries from the Seller's Facility. Seller
understands that in the case of emergency circumstances, real time operations of the electrical system,-20-
sng*oro
and/or unplanned events Idaho Power may not be able to provide notice to the Seller prior to
intemrption, curtailment, o,r reduction of elechical energy deliveries to Idaho Power.
ARTICLE XI[: INDEMNIFICATION A}.TD INST.JRANCE
13.1 tldemnification - Each Party shall agree to hold harmless and to indemniff the other Party, its officers,
agents, affiliates, subsidiaries, parent company and employees against all lossn darnage, expemse and
liability to third persons for injury to or death of person or lnjury to property, proxipately caused by the
indemniffing Party's (a) constuction, ownership, operation or rnaintenance of, or by failure of, any of
such Party's works or facilities used in connection with this Agreement or (b) negligent or intelrtional
acts, errors or omissions. The indernnitnng Party shall, on the other Party's request, defelrd any suit
asserting a claim covered by this indeinnity. The indemniffrng ParB shall pay all documented costs,
including reasonable attorney fees that may be incurred by the other Party in enforcing this indernnity.
13.2 Insuqnce - During the terrr of this Agreement, Seller shall secure and continuously carry the following
insurance goverage:
13.2.1 Conprehensive General Liability Insuraace for both bodily injury and property darnage with
lirrits equal to $1,000,000, each occurrence, combiaed single limit. The deductible for such
insurance shall be consistent with crrrent Insurance Industry Utility practices for similar
property.
13.2.2 The above insurance coverage shall be ptaced with an insurance company with an A.M. Best
Company rating of A- or better and shall include:
(a) An endorsement naming Idaho Power as an additional insured aad loss payee as
applicable; and
O) A provision stating that such policy shall not be canceled or the limits of liability
reduced without sixty (60) days' prior written notice to Idaho Power.
13.3 Seller to Provide Certificate of Insurance - As required in paragraph 4.1.5 herein and annually
the,reafter, Seller shall fumish Idaho Power a certificate of insurance, together with the endorsernents
required therein, evidencing the coverage as set forth above.
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t3.4 Seller to Notiff ldaho Power of Loss of Coverase - If the insurance ooverage required by paragraph
13.2 shatl lapse for any reas,on, Seller will immediately notify Idaho Power in writing. The notice will
advise Idaho Power of the specific reason for the lapse and the steps Seller is taking to reinstate the
coverage. Failure to provide this notice and to expeditiously reinstate or replace the coverage will
constitute a Material Breach of this Agreement.
A,RTICLE XIV: FORCE MAJEI.JRE
l4.l As used in this Agreement, "Force Majeure'or "an event of Force Majeure" trneans any cause beyond
the conhol of the Seller or of Idaho Power which, despite the exercise of due diligeirce, such Party is
uable to prevent or overoome. Force Majeure includes, but is not limitd to, acts of God, fire, flood,
storms, wars, hostilities, civil strife, strikes and other labor disturbances, earthquakesn fires, lightnins
epidemics, sabotage, or changes in law or regulation occurring after the effective da0e, which, by the
exercise of reasonable foresight such party codd not reasonably have been €xpected to avoid and by the
exercise of due diligence, it shall be unable to overcome. If either Party is rendered wholly or in part
mable to perform its obligations under this Agreement b@ause of an event of Force Majeure, both
Parties shall be excused from whatever performance is affected by the event of Force Majeure, provided
that:
(l) The non-performing Party shall, as soon as is reasonably possible after the occrnrenoe
of the Force Majeure, grve the other Parly writt€n notice describing the particulars of
the occurrerce.
(2') The suspension of performance shall be of no geater scope and of no longer duration
than is required by the event of Force Majeure.
(3) No obligations of either Party which arose before the occurrence causing the suspension
of performance and which could and should have been fully perfb,nned before such
oocrurence shall be excused as a result ofsuch occurrence.
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ARTICLE XV: LIABILITY: DEDICATION
ts.l Limitation of Liability. Nothing in this Agreement shall be constnred to qreate any duty to, any
standard of care with reference to, or any liability to any person not a Party to this Agreeme$. Neither
party shall be liable to the other for any indirect, special, consequential, nor punitive damages, except as
expressly authorized by this Agreement. Consequential darnages will include, but not S6 limited to, the
value of reuewable enerry certificates and, if the Facility is fueled by gas produced by an anaerobic
digester systenL any diminution or loss of anaerobic activity due to the inability of Idaho Power to
accept erergy from the Facility.
15.2 Dedication. No undertaking by one Party to the other under any provision of this Agreement shall
oonstitute the dedication of that Party's system or any portion thereof to the Party or the public or affect
the status of ldaho Power as an independent public utility corporation or Seller as an independent
individual or entity.
ARTICLE XVT SEVEML OBLIGATIONS
16.1 Except where specifically stated in this Agreement to be otherwise, the duties, obligations and liabilities
of the'Parties are intended to be seve,ral and not joint or collective. Nothing contained in this Agreement
shall ever be construed to create an association, tnst, partnership orjoint venture or impose a tnrst or
partnership duty, obligation or liability on or with regard to either Party. Each Parly shall be
individually and severally liable for its own obligations under this Agreement.
t7.t
ARTICLE XVII: WAIVER
Any waiver at any time by either Party of its rights with reqpect to a default under this Agreement or
with respect to any other matters arising in connection with this Agreement shall not be deemed a
waiver with respwt to any subsequent default or other matter.
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18.1
18.2
ARTICLE XVIII: CHOICE OF LAWS AND VENUE
This Agreement shall be corctrued and interpreted in accordance with the laws of the State of Idaho
without reference to its choice of law provisions.
Venue for any litigation arising out of or related to this Agreement witl lie in the District Court of the
Forrth Judicial District of Idaho in and for the Couty of Ada.
ARTICLE )(D(: DISPUTES AND DEFAULT
l9.l Dsputes - All disputes rclated !o or arising under this Agreement, including, but not limited to, the
interpretation of the terms and conditions of this Agreement, will be submitted to the Commission for
resolution.
lg.2 Notiae of Default
tg.z.l Defaults. If either Party fails to perform any of the terms or conditions of this Agree,ment
(an "event of default:'), the nondefaulting Party shall cause notice in uniting to be given to
the defaulting Parly, spetifying the rnanner in which such default occurred. If the defaulting
Party shall fail to cure such default within the sixty (60) days after service of such notice, or
if the defoulting Party reasonably demonstrates to the other Party that the default can be
cured within a commercially reasonable time but not within such sixty (60) day period and
then fails io diligently pursue such cure, then, the nondefaulting Pagy may, at its option,
terminate this Agreement and/or pursue its legal or equitable remedies.
19.2.2 Material Breaches - The notice and cure provisions in paragraph 19.2.1 do not apply to
defaults identified in this Agreement as Material Breaches. Material Breaches must be cured
as expeditiously as possible following occumence of the breach.
19.3 Security for Perforrnance - Prior to the Operation Date and thereafter for the full term of this
Agreement, Seller will provide Idaho Power with the following:
19.3.1 Insurance - Evidence of compliance with the provisions of paragraph 13.2, lt Seller fails to
comply, such failure will be a Matsrial Breach and may gsly be cued by Seller supplying
evidence that the required insurance coverage has been replaced or reinstated;
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19.3.2 Eneineer's Certifications - Every three (3) years after the Operation Date, Seller will supply
Idaho Power with a Certification of Ongoing Operations and Maintenance (O&fvI) from a
Registered Professional Engineer licensed in the State of ldalrc, which Certification of
Ongoing O & M shall be in the form specified in Appendix C. Seller's faihne to supply the
required certificate will be an event of default. Such a default may only be crned by Seller
providing the required certificate; and
19.3.3 Licenses and Permits - During the full term of this Agreernent, Seller shall maintain
compliance with all permits and licenses described in paragraph 4. 1.1 of this Agreement. In
addition, Seller will supply Idaho Power with copies of any new or additional perrri* or
licenses. At least ever'y fifth Contract Year, Sellerwill update the documentation described
in Paragraph 4.1.1. If at any time Seller fails to maintain cornpliance with the permits and
licenses described in paragraph 4.1.1 or to provide the documentation required by this
paragraph, such failnre will be an event of default and rnay only be cured by Seller
submiuing to ldaho Power evidence of compliance &om the permitting agency.
ARTICLE XX: GOVERNMENTAL AUTHORIZATION
2O.l This Agreenrcnt is subject to the jurisdiction of those govemmental agencies having conhol over either
Party of this Agreement.
ARTICLE XXI: COMMISSION ORDER
2l.l This Agreernent shall become finally effective upon the Commission's approval of all terms and
provisions hereof without change or condition and declaration that all payments to be made to Seller
heretmder shall be allowed as pnrdently incurred expenses for ratemaking purposes.
ARTICLE XXII: SUCCESSORS AND ASSIGNS
22.1 This Agreement and all of the terms and provisions hereof shall be binding upon and inure to the benefit
ofthe respective successors and assigns ofthe Parties hereto, except that no assignment hereofby either
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Party shall kcome effective without the written consent of both Parties being first obtained. Such
consent shall not be unreasonably withheld. Notrrithstanding the foregoing any party which Idaho
Power may consolidate, or into *hich it rnay me[ge, or to which it may convey or hansfer substantially
all of its electric utility assets, shall autornatically, without firther act, and without need of consent or
approval by the Seller, succeed to all of Idaho Power's rights, obligations and interests undrr this
Agreenrent. This article shall not preve,nt a financing entity with recorded or secured rights from
exercisiqg all rights and rerredies available to it under law or conhact. Idaho Power shall have the right
ARTICLE X)iltr: MODIFICATION
23.1 No modification to this Agreement shall be valid unless it is in writing and signed by both Parties and
subsequently approved by the Commission
ARTICLE XXIV: TAXES
24.L Each Party shall pay before delinquency all taxes and other govemmental charges which, if failed to be
paid when due, could result in a lien upon the Facility or the Interconnection Facilities.
. ARTICLE XXV: NOTICES
25.L All written notices under this Agreernent shall be dirccted as follows and shall be considered
delivered whe,n faxe{ e-mailed and confimred with deposit in the U.S. Mail, first-class,
postrye pr€pai( as follows:
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To Seller:
Orieinal document to:
Lauralhothe, PE
New EnergyOne, LLC
8720 Vic Lane
Middleton ID 83644
Telephone:
Cell:
FAX:
(208) 8e0{783
(208) s85-9016
E-mail: [e-mail]
To ldaho Power:
Original documentto:
Vice President, Power Supply
Idaho Power Company
PO Box 70
Boise,Idaho 83707
Emait [e-mail]
Copy of document to:
Cogeneration and Small Power Production
Idaho Power Cornpany
PtO Box 70
Boise, Idaho 83707
E-mail: rallphin@.idahopower.com
Either Party may change the contact person and/or address information listed above, by providing udttsn notice
from an authorized person rcpresenting the Party.
ARTICLE XXVI: ADDITIONAL TERMS A}.[D CONDITIO},6
26.1 This Agreernent includes the following appendices, which are attrached hereto and included by
reference:
Appendix A
Appendix B
AppendixC
Appendix D
Generetion Scheduling and Reporting
Facility and Point of Delivery
Engineer's Certifi catiolts
Forms of Liquid Security
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ARTICLE XXVII: SEVERABILITY
27.1 The invalidity or unenforceabilrty of any term or provision of this Agreement shall not affect the
validity or enforceability of any other ternrs or provisions and this Agreement shall be construed in all
other respects as if the invalid or unenforceable tem or provision were omitted.
ARTICLE )O(MII: COUNTERPARTS
28.1 This Agreernent may be executed in two or more counterparts, each of which shall be deemed an
original but all of which together shall constitute one and the same instrunent.
ARTICLE X)CIC ENTIRE AGREEMENT
29.1 This Agreement constihrtes the entire Agreement of the Parties concef,ning the subject matter hereof and
supersedes all prior or contemporaneous oral or written agrcements befiveen the Parties concerning the
subject matterhereof.
IN WIINESS WHEREOF, The Parties hereto have caused this Agreement to be executed in
their respec,tive narnes on the dates set forth below:
Idaho Porrrer Conrpany New Enerry One, LLC
By By
Lisa A Grrow
Sr. Vice Pr€sident, Power Supply
l-auraKnothe, PE
Dated 524tO Dated 5 2l l0
"Idaho Powet''
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APPENDX A
A-1 MONTIILY POWERPRODUCTION AND SWITCHING REPORT
At the end of each month the following required documentation will be submitted to:
Idaho Power Company
Attr: Cogeneration and Small Power hoduction
FOBox 70
Boise, Idaho 83707
The meter readings required on this report will be the readinp on fhe ldaho Power Meter Equipment measuring
the Facility's total energy production and Station Usage delivered to ldaho Power and the rnaximum generated
energy (kW) as recorded on the Metering Equipment andlor any other required energy measuements to
adequately administer this Agreement. This document shall be the document to enable Idaho Power to begin the
energy payment calculation and payment process. The meter readings on this report shall not be usod to
calculate the actual paymenL but instead will be a check of the automated meter reading information tbat will be
gathered as described in item A-2 below:
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Idrho Power Comprny
Cogeneretion end Small Power Production
MONTHLY POWER PRODUCTION AIITD SWITCIIING REPORT
Month Year
Prolect Name
Address
City
Profect Number:
PhoneNumber:
State 7ip
Feclllty
Outout
Statton
Ueeee
Stetion
Usase
Metered
MrimmGeneqdon
kw
Meter Number:
End of Month klYh Meter Rerding:
Beginrtng of Month kWh Meter:
Dffference:
Tlmes Meter Constant:
kWh forthe Month:
Metered Demend:
Net C,eneratlon
Breakcr OpenlngRecord Breaker Clorlng Record
Dete Tlme Meter *Reeson Date Ttme M€ter
* Breaker Ooenlnq Rerson Codes
I Lack of Adequate Prime Mover2 tr'orccd Outege of FeciHty3 DbturbenceoflPCoSystem
4 Scheduled Meintenance5 Tesdng of Protection Systems5 Ceuse Unhown7 Other (Explein)
I hereby cedfy thrt the above meter readlngs are
true and corrcct ar of Mldnlght on the lart dey of the
above month and thrt the switchlng record lr rccurate
and complete as required by the Flrm Energr Sales
Agreement to whlch I am a Perty.
Signeture Drte
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A.2 AIITOMATED METER READING COLLECTION PROCESS
Monthly, Idaho Power will use the provided Metering and Telemefiry equipment and processes to collect the
meter reading information from the Idaho Power provided Metering Equipment that rneasures the Net Enerry
and energy delivered to supply Station Use for the Facility recorded at 12:00 AM (Midnigh} of the last day of
the month..
The meter information collected will include but not be limited to energy production, Station Use, the rnaximum
gengrated power (kW) and any other required €nergy measurements to adequately administer this Agreement.
A.3 ROUTINEREPORTING
Once the Facility has achieved its Operation Date and has operated in a reliable aod consistent rnnner
for a reasonable period of time, the Parties may mqtually agree to modi$ this Routine Reporting
requirement.
Idaho Power Contact Information
Daily Energy Production Renorting
Call daily by l0 a.rn, l-800-3564328 or l-800{35-1093 and leave the following informotion:
o Project Identification - Project Name and Project Numbero Current Met€r Readingr Estimated Generation for the current day. Estimated Generation for the next day
Planned and Unplanned Project outages
Call 1-800-345-1319 and leave the following information:
o Project Identification - Project Name and Project Numboo Apprcximatetime outage occumed. Estimated day and time of project coming back online
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Seller' s Contact Information
24-Hour Project Ogerational Contact
Name:
Telephone Nurrber:
Cell Phone:
JayKesting
(208) 9474s19
Q08)sse424
Projqct On*ite Contact information
Name: Kurt Standley
Telephone Number: [phone]
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APPENDX B
FACILITY AND POINT OF DELIVERY
Project Name: Rock Creek Datry
Project Number: 3 16 161 10
B-I DESCRIPTION OF FACILITY
(ltust include lbe Naneplate Capacity rattng ond YAR cqability (both leading ond lagging) of all generation
units to be incladed in the Focilily.)
The facility consists of an anaerobic digest€r, gen sets and waste handling equipment. The total
nameplate capaclty of the three generators is 4000 kW.
Var Capability @oth lead@ and laging) Leading is .98 Lagging is .8
8.2 LOCATION OF FACILITY
Near: Filer,ID
. Sections: -f-Township: -l-lS- Range: tOf nircrOuaaraugte- County: TwinFalls. D.
Description of Intereonnection Location: Near 2175 E 3500N. Filer ID 83328
Nearest Idaho Power Sub$ation: Clover Substation
B-3 SCTMDULED FIRST ENERGY AND OPERATION DATE
Seller has selected May 1. 201I as the Scheduled First Enerry Date.
Seller has selected May 15. 2012 as the Scheduled Operation Date.
In rnaking these selections, Seller recognizes that adequate testing of the Facility and completion of alll
s ia paragraph 5.2 of this Agreement must be completed prior to the project being granted
an Operation Date.
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84 MAXIMUM CAPACITY AMOUNT:
This value wifl be 4 MW which is consistent with the value provided by the Seller to Idaho Power
in accordance with Schedule 72. This value is the maximum enerry (MW) that potentially could be
deliverd by the Seller's Facility to the Idaho Power electrical system- at any momeot in time.
B-5 POINTOF DELIVERY
"Point ofDelivery" means, unless otherwise agreed by both Parties, the point of where the Sellers
Facility's eoergy is delivered to the Idaho Power electical system. Schedule T2willdetermine the
specific Point of Delivery for this Facility. The Point of Delivery identified by Schedule 72 will become
an integral part of this Agreement.
86 LOSSES
If the Idaho Power Metering equipment is capable ofmeasuring the exact en€rgy deliveries by the Seller
to the Idaho Power electrical syst€rn at the Point of Delivery, no Losses wifl be calculated for this
Facitty. If the Idaho Power Metering is unable to measure the exact energy deliveries by the Seller to
the Idaho Power electrical system at the Point of Delivery, a Losses calculation will be established to
measure the energy losses (kWh) between the Seller's Facility and the ldaho Power Point of Delivery.
This loss calculation will be initially sel $ 2o/o of the kWh energy production recorded on the Facility
generation metering equipment. At such time as Seller provides Idaho Power with the electrical
equipment specifications (transformer loss spocifications, conductor sizes, etc) of all of the electical
eguipment betweeo the Facility and the Idaho Power electical systern, Idaho Po-uzer will configurt a
revised loss calculation formula to be agreed to by both parties and used to calculate the kWh Losses for
the remaining tsrm of the Agreement, If at any time during the term of this Agreemen! ldaho Power
determines that the loss calctrlation does not correctly reflect the actual kWh losses attributed to the
electrical equipment between the Facility and the Idaho Power electrical system, Idaho Power may
adjust the calculation and retroactively adjust the pevious months kWh loss calculations.
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B-7 METERING AND TELEMETRY
Schedule 72 will deterrrine the specific metering and telemetr5r requirements for this Facility. At the
minimum the Metering Equipment and Telemetry equipment must be able to provide and reoord hourly
energy deliveries to the Point of Delivery and any other enerry measuretnents required to administer
this Agreement. These specifications will include but not be limited to equipment specifications,
equipment location, Idaho Power provided equipmen! Seller provided equipment, and all costs
associated with the equipment, design and installation of the Idaho Power provided equipment. Seller
will arrange for and make available at Seller's cost communication circui(s) compatible with Idaho
Po'wer's communications equipment and dedicated to ldaho Power's use terminating at the Idaho Power
facilities capable of providing ldaho Power with continuous instantaneous information on the Facilities
enerry production. Idaho Power provided equipment will be owned and maintained by Idaho Powern
with total cost of purchase, installation, operation, and maintenance, including adminisfiative cost to be
reimbursed to ldalro Power by the Seller. Payment of these costs will be in accordance with Schedule
72 arrd the total metering cost will be included in the calculation of the Monthly Operation and
Maintenauce Charges specified in Schedule 72.
B-8 NETWORK RESOURCE DESIGNATION
Idaho Power camot accept or pay for generation from this Facility until a Network Resource
Designation ('NRD') application has been accepted by Idaho Power's delivery business unit. Federat
Energy Regulatory Commission (*FERC") Rules require Idaho Power to prepare and submit the NRD.
Because much of the information ldaho Power needs to prepane the NRD is specific to thc Seller's
Facility, ldaho Power's ability to file the NRD in a timely manner is contingent upon timely receipt of
the roquired information from the Seller. Prior to Idaho Power beginning the process to enable ldaho
Power to submit a request for NRD status for this Facility, the Seller shall have completed all
requirements as specified in Paragraph 5.1 of this Agreement. Seller's failure to provide complete
and accurate information in r timely mrnner can significanfly imprct Idrho Power'g abtlity and
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cos to.attrin the I\IRD decignadon for the Seller's Frcillty and the Seller chell berr the costs of
eny of these deleyr tiat are a result of any acfon or lnecdon by the Seller.
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APPENDD( C
ENGINEER'S CERTIFICATION
OF
OPERATIONS & MAINTENANCE POLICY
The undersigned , on behalf of himself and
hereinafter collectively referred to as "Engineer," hereby states and certifies to the Seller as follows:
l. That Engineer is a Licensed Professional Engineer in good standing in the State of Idaho.
2. That Engineer has reviewed the Energy Sales Agreernen! hereinafter uAgreerne,n!" between ldaho
PowerasBuyer, and Seller, dated
3. That the cogeneration or small power production project which is the subject of the Agreement and this
Statement is identified as IPCo Facility No.and is hereinafter referrcd to as the "Project."
4. That the Projecq which is commonly known as the ect, is located in
Section _ Township _ Range _rBoise Meridian,
-
County, Idaho.
5. That Engineer recognizes that the Agreement provides for the Project to furnish elecUical e,nqr$l to
Idaho Power for a _ year period,
6. That Engineer has substantial experience in the desigrq consfiuction and operation of electric power
plants of the same tSpe as this Project.
7. That Engineer has no economic relationship to the Desip Engineer of this Project.
8. That Engineer has reviewed and/or supervised the review of the Policy for Operation and Maintenance
("O&M") for this Project and it is his professional opinion that, provided said hoject has been designed and
built to appropriate standards, adherence to said O&M Policy will rezult in the Project's producing at or near the
design electrical output, efficiency and plant fuctor for a fifteen (15) year psiod.
g- That Engineer recognizes that Idaho Power, in accordance with paragraph 5.2 of the Agreement, is
relying on Engineer's representations and opinions contained in this Statpment.
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10. That Engineer certifies that tlrc above stdmnts ar€ coryl€te, tnre aad accurat€ to the best of his
knowledge and therefors sets his land and seal below.
By
(P.E. Stary)
Dste
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APPENDD( C
ENGINEER'S CERTIFICATION
OF
ONGOING OPERATIONS AND MAINTENA}.ICE
The rmdersigned on behalf of himself and
hereinafter collectively referred to as "Engineer,'hereby states 8nd certifies to
the Seller as follows:
1. That Enginer is a Licensed Professional Engineer in good standing in the State of ldaho.
2. That Engineer has reviewed the Enerry Sales Agreemen! hereinafter "Agreement," betw@n Idaho
Power as Buyer, and as Seller, dated
3. That the cogeneralion or small powff production project which is the subject of the Agreement and this
Stateme,rt is identified as IPCo Facility No.and hereinafter referred to as the "Project"
4. That the Project, which is commonly knowu as the . Project, is locat€d in
Section
-
Township
-
Range --Boise Meridiffi,
-
County, Idaho.
5. That Engineer recognizes that the Agreeme,nt provides for the Project to firnish elecfrical energy to
Idaho Power for a fifteen (15) year period.
6. Thaf Engineer has substantial experience in the design, constuction and operation of electic power
plants of the same type as this Project
7. That Enginoer has no economic relationship to the Design Engineer ofthis hoject.
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8. That Engrneer has made a physical inspoction of said hoject, its operations and rnaintenance records
since the last previous certified inspection. It is Engineer's pmfessional opinion, based on the hoject's
appeamrce, that its ongoing O&M has been substantially in accordance with said O&M Policy; that it is in
reasonably good operating condition; and that if dher€nce to said O&M Policy continues, the hoject wilt
continue producing at or near its design electrical oupu! efficiency and plant factor for the remaining
years of the Agreement.
9. That Engineer recognizes that ldaho Power, in accordance with paragraph 5.2 of the Agreemen! is
relying on Engineer's representations and opinions contained in this Statemeat
10, That Engineer certifies that the above staterreuts are corrylete, true and accurate to the best of his
knowledge and therefore sets his hand and seal below.
By
(P.E. Stamp)
Date
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The uudersigned
APPENDX C
ENGINEER'S CERTIFICATION
OF
DESIGN & CONSTRUCTION ADEQUACY
on behalf of himself and
hereinafter collectively referred to as "Engineer", hereby states and certifies to
Idaho Power as follows:
I That Engineer is a Licensed Professional Engineer in good standing in the State of ldaho.
2.That Engineer has reviewed the Firur Energy Sales Agreement, hereinaft€r "Agreef,nentn,
betrreen Idaho Power as Buyer, and as Seller, &td _=
3. That the cogeneration or small power production projecq which is the subject sf the Agreernent
and this Statement, is identified as IPCo Facility No
-
and is heneinafter refeired to as the
"Project".
4. That the Project, which is commonly known as the -- Project, is located in
Section _ Township
-
Rang€
-r
Boise Meridi*,
-
County, Idaho.
5. That Engineer recognizes that the Agreement provides for the Project to firnish electical
energy to Idaho Power for a fifteen (15) year period.
6. Tha Engineer has substantial experience in the design, constnrction and operation of electric
power plants of the same tlpe as this Project.
7. That Engineer has no economic relationship to the Design Engineu of this Project and has
made the analysis of the plans and specifications independently.
8. That Engineer has reviewed the engineering desigr and consfiuction of the Project, including
the civil work, elechical worh generating equipment, prime mover conveyance systern, Seller firmished
Interoonnection Facilities and other Project facilities and equipment.
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t
9. That the hoject has been constructed in accordance with said plans aod specifications, all
applicable codes and consistent with Pmdent Elechical Practices as that term is described in the Ageemenl
10. That the design and constnrction of the Project is such that wilh reasonable and pndent
operation and rnaintenance practices by Seller, the Project is capable of perforrning in accordance with the terms
of the Agreement and with Prudent ElecEical Practices for a
-
year period"
11. That Engineer recognizes that Idaho Power, in accordance with paragraph 5.2 ofthe Agreemept
in intErconnecting the Project with its systern, is relying on Engineeds representations and opinions contained in
this $1stemen1.
12. That Engineer certifies that the above statements are complete, tnre and aqcurate to the best of
his knowledge and therefore sets his hand and s€al below.
By
(P.E. Stamp)
Date
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Y
APPENDX D
FORMS OF LTQUID SECLTRITY
The Seller shall provide Idaho Power with commercially reasonable security instruments such as Cash
Escrow Security, Guarantee or Letter of Credit as those terms are defined below or other foms of liErid
financial security that would provide readily available cash to Idaho Power to satisS the Delay Security
requirement within this Agreement.
For the purpose of this Appendix D, the term'Credit Requirements'shall mean acceptable financial
creditworthiness of the entity providing the security instrumeut in relation to the term of the obligation
in the reasonable judgment of Idaho Powero provided that any guarantee andlor letter of credit issued by
any other entity with a short-term or long-term invesheut grade credit rating by Standard & Poor's
Corporation or Moody's Investor Services,Inc. shall be deemed to have acceptable financial
creditrrorthiness.
l. Cash Escrow Security - Seller shall dcposit funds in an escrow accormt established by the Seller in
a banking institution acceptable to both Parties equal to the Delay Security.
2. Guarantee or ktter of Credit Security - Seller shall post and maintain in ao amount equal
to the Delay Security: (a) a guaranty from a party that satisfies the Credit Requirernents, in
a form acceptable to ldaho Power at its discretion, or (b) a I*tter of Credit in a form
acceptable to Idaho Power, in favor of ldaho Power. The Letter of Credit will be issued by
a financial institution acceptable to both parties.
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Office of the Seoetary
Service Date
July 1,2010
BEf,'ORE THE IDAHO PI]BLIC UTILITIES COMNIISSION
IN TIIE MATTER OF THE APPLICATION
OF IDATIO POWER COMPAIYY FOR
APPROVAL O['A T'IRM EI\IERGY SALES
AGREEMENT FORTHE SALE AND
PURCHASE OF ELECTRIC ENERGY
BETWEEN IDAIIO POWER COMPANY
AND NEW ENERGY ONE, LLC (ROCK
CASE NO. IPC.E-10.16
oRDER NO. 32025
CREETO
On May 25, 2010, Idaho Power Company (Idaho Power; Company) filed an
Application with the Idaho Public Utilities Commission (Commission) requesting approval of a
l5-year Firm Energy Sales Agreeurent betwee,n Idaho Power and New Energy One, LLC dated
May 24, 20 I 0 (Agreement).
AGREEMBNT
Under the terms of the Agreement, New Energy will sell and Idaho Power purchase
elechic energy generated by the Rock Creek Dairy Anaerobic Digester Power Project (Facility)
located near Filer in Twin Falls County, Idaho. The location of the Facility is more particularly
described as Section 6, Township 11 S, Range 16 E, Filer Quadrangle, TwinFalls County,Idaho.
Appendix B-2. New Energy warants that the Facility is a qualifying facility (QF) under
applicable provisions of the Public Utility Regulatory Policie.s Act of 1978 (PURPA). fl 3.2.
The nameplate rating of the Facility is 4 MW. Appendix B-1. The Maximum
Capacity Amount is 4 MW. Appendix B-4. Under normal and/or average conditions, the
Facility will not exceed 10 alvlw on a monthly basis. Should the Facility exceed 10 aIVIW on a
monthly basis, Idaho Power will accept the energy (Inadvertelrt Energy) that does not exceed the
Ma:rimum Capacity Amount; however, the Company will not purchase or pay for the Inadvertent
Energy. 117.5.
The Agreement contains the non-levelized published avoided cost rates approved in
Order No. 30744 and comports with the terms and conditions of Order Nos. 30738 (SAR non-
fueled cost variables) and 30415 (daily load shape adjusfinent). fl 7.1. New Energy has selected
a Scheduled Operation Date of May 15,201,2. Appendix B-3.
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Idaho Power notes that the purchase rates set forth in the Agreement Order No.
30744, had on the May 24, 2010, date of sonfiact sigmng been replaced by the lower rates of
Order No. 30125 approved by the Commission on March 16, 2010, in Case No. GNR-E-10-01.
Idaho Power recites that the Commission has previously determined grandfathering eligibility for
(older and higher) published avoided cost rates by requiring (l) a signed power sales agreement
be executed prior to the change in rates; or (2) a meritorious complaint filed with the
Commission demonshating project maturity and that but for the actions of the utility a sales
agreement would have been signed prior to the change in rates. Although not filing a complaint
with the Commission, by signing the Agreement and voluntarily presenting it to the
Commission, Idaho Power has nevertheless concluded that New Energy meets the second test of
the Commission and should be entitled to the rates established by Order No. 30744.
In determining that New Energy was entitled to grandfathering under the higher rates
of Order No. 30744, the Company concluded that New Energy satisfied the following
grandfathering criteria prior to March 16, 2010:
a. Intercorurection and Transmission
i. Filed an interconnection application; and
ii. Received and accepted an interconnection feasibility study report for
the project and paid any requested study deposits (or established credit)
for the next phase of the interconnection process in accordance with
Schedule 72;and
iii. Received confirmation from Idaho Power that transmission capacity is
available for the project and/or received accepted transmission capacity
study results and cost estimates.
b. Furchase Power Agreement
An agreement was materially complete and would have been executed
by both parties prior to March 16, 2010, and except for routine ldaho
Power final processing, an agreement would have been executed prior
to March 16,2010.
It is Idaho Power's opinion that the New Energy Facility meets all of the above-referenced
criteria. The Interconnection and Transmission criteria werc met at the time the 86 Facility was
interconnected with Idaho Power to make sales of non-firm energy under the Schedule 86
Agreement.
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With respect to the Power Purchase Agreement criteri4 the Company contends that
New Energy and Idaho Power had resolved all material outstanding confi?ct issues. Both parties
expected the final review to be a relatively staightforward process. However, in early February,
the Company became aware of some new procedural requirements from the Federal Enogy
Regulatory Commission (FERC) ttrat alfected the way that the Facility would qualify for a
network resource designation and thereby obtain the hansmission needed to bring the power to
be generated by the Facility from the interconnection to the Company load centers. The new
procedure required some changes to the internal process at Idaho Power. Idaho Power embarked
upon interpreting the regulations and implementing a process to be in compliance. In ldatro
Power's opinion the Agreement would have been signed by both parties prior to March 16,2010,
except for the time required by Idaho Power to implement the new intemal transmission and
network resource process an{ as a result the Facility should qualiff for a contract including the
Order No. 30744 rates. New Energy is current in all its interconnection study payments and so
long as New Energy continues to provide requested information in a timely manner and pay
invoices on time, it appears that the interconnection can be completed in time for New Energy to
achieve its Scheduled Operation Date for the Facility.
In firther support of its request for grandfathering, Idaho Power states that the
Facility Agreement contains the most recent contract terms and conditions, including the
liquidated damages and security provisions previously approved by the Commission in the
contracts for the Arena Drop hydro and the Dry Creek anaerobic digester projects, Order Nos.
31060 and 31034, respectively.
Agreement tl2l.l provides that the New Energy Agreement will not become effective
until the Commission has approved all of the Agreement's terms and conditions and declared
that all payments Idalro Power makes to New Energy for purchases of energy from the Facility
will be allowed as prudently incurred expenses for ratemaking purposes.
On June 3, 2010, the Commission issued a Notice of Application and Modified
Procedure in Case No. IPC-E-10-16. The deadline for filing written comments was June 23,
2010. Commission Staffwas the only party to file comments.
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Staff Comments
Staff believes that the grandfathering criteria developed and applied by Idaln Power
in this case are fair and reasonable. Based on the facts presented in this case, Stalf believes that
but for the actions of Idaho Power, the Agreement would have been fully executed pnor to
March 16,2010. Consequently, Staff recommends approval of all of the Agreement's terms and
conditions including grandfathered purchase rates (Order No. 30744).
COMI\flSSION FINDINGS
The Commission has reviewed and considered the frlings of record in Case No. IPC-
E-10-16 including the Firm Energy Sales Agreement between Idatro Power Company and New
Energy One, LLC (Rock Creek) dated May 24,2OlO and comments and recommendations of
Commission Staff. The Agreement is for a l5-year term. The nameplate rating of the Rock
Creek Facility is 4 MW.
The Agreement contains the non-leveliz.edpublished avoided cost rates established by
the Commission in Order No. 30744. On the May 24,2010 date of contract signing the higher
contact rates had been replaced by the lower rates of OrderNo. 30125 (Case No. GNR-E-10-01)
approved by the Commission on March 16, 2010. We find that the Company has fairly
represented our past grandfathering criteria requireme,lrts. We further find the Company's
approach in this case regarding contract rates to be in concert with the spirit of those prior
grandfathering cases. See A.W. Brown v. Idaho Power,l2l Idatro 812, 828 P.2d 841 (1992);
Order No. 29872, Case No. IPC'E-05'22.
In this case, Idaho Power and Staff believe that New Energy is entitled to
grandfathering and the rates of Order No. 30744. Idaho Power represents that all outstanding
contact issues had been resolved prior to March 16, 2010, and that but for the internal review
process of the Company a contract would have been signed prior to March 16. Based on the
record established in this case, we find that New Energy is entitled to the grandfathered rates of
Order No. 30744. As represented and pursuant to contract terms, under normal and/or average
conditions the generation from the Rock Creek Facility will not exceed 10 aMW on a montily
basis. The Commission finds the Agreement submitted in this case contains acceptable contract
terms. We fi5ther find it reasonable to allow payments made under the Agreement as prudenfly
incurred exp€nses for ratemaking purposes.
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CONCLUSIONS OF LAW
The Idaho Public Utilities Commission has jurisdiction over Idatro Power, an electric
utility, and the issues raised in this matter pursuant to the authority and power granted it under
Title 61 of the Idaho Code and the Public Utility Regulatory Policies Act of 1978 (PUPJA).
The Commission has authority under PURPA and the implementing regulations of
the Federal Energy Regulatory Commission (FERC) to set avoided costs, to order electric
utilities to enter into fixed-term obligations for the purchase of energy from qualified facitities
(QFs) and to implement FERC rules.
ORDER
In consideration of the foregoing and as more particularly described above, IT IS
HEREBY ORDERED and the Commission does hereby approve the May 24,20l},Finn Energy
Sales Agreement between Idalro Power and New Energy One, LLC for the Rock Creek Dairy
Anaerobic Digester Power Project.
TI{IS 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 ldaho Code $ 6l-626.
ORDERNO. 32025 5
DONE by Order of the Idaho Public Utilities Commission at Boise, Idatro this / sf
day of July 2010.
n"i/*I
MARSHA H. SMITH, COMMISSIONER
\
S<J.4.
MACK A.COMMISSIONER
ATTEST:
J D.J
bls/IPC-E-10-16 sw2
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