20210104Exhibit 17.pdf

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Exhibit 17
RECEI\'I
sEm"
AN IDACORPCOMEry
Plt h:
DOilO\,AI{ E. WALKER
Scnlor Gounrol
drYal ken8ldahooorer.com
Oc{ober 20,2A1O
VIA HAT{D DELIVERY
Jean D. Jewell, Secretary
Idaho Public l Jtilities Commission
472 West Washington Street
P.O. Box 83720
Boise, ldaho 83720fi74
Re: Case No. IPGE-10-26
IN THE MATTER OF THE APPLICA'TION OF IDNIO POWER COTTPANY
FOR APPROVAL OF A FIRM ENERGY SAI.ES AGREEMENT WTH
AGPOWER JEROME, LLC, FOR THE SALE AND PURCHASE OF
ELECTRIC EA'ERGYFROM THE DOUBLE A DIGESTER PROJECT
Dear Ms. Jewell:
Enclosed for filing please find an original and seven (7) copies of ldaho Power
CompanfsApplication in the above matter.
very )@uE,f"W
Donovan E. Walker
DEW:csb
Enclosures
1221 W. ldaho St, G3702)
P.O. Box 70
Boisg lD 8107
DONOVAN E. WALKER (lSB No. 5921)
LISA D. NORDSTROM (lSB No. 5733)
ldaho Power Company
P.O. Box 70
Boise, ldaho 83707
Telephone: (208) 38&5317
Facsimile: (208) 3886936
dwa I [e-mail]
I nordstrom@idahooower. oom
Attomeya for ldaho Power Company
Stleet Address for Ercress Mail:
1221 West ldaho Street
Boise, Idaho 83702
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION
OF IDAHO POWER COMPANY FOR
APPROVAL OF A FIRM ENERGY SALES
AGREEMENT WITH AGPOWER
JEROME, LLC, FOR THE SALE AND
PURCHASE OF ELECTRIC ENERGY
FROM THE DOUBLE A DIGESTER
PROJECT.
oASE NO. IPC-E-10-26
APPLICATION
ldaho Power Company ("ldaho Powef or "Companf), in accordance wtth ldaho
Code S 61-503 and RP 52 and the applicable provisions of the Public t tility Regulatory
Policies Act of 1978 ('PURPA'), hereby respectfully applies to the ldaho Public Utillties
Commission ("lPUg or'Commission") for an Order appoving the Firm Energy Sales
Agreement ("FESA") between ldaho Power and AgPower Jerome, LLC ("AgPowef)
under wlrich AgPower would sell and ldaho Power uould purchase electric energy
generated by the Double A Digester Project ("Facilit/) located in Linoln County, ldaho.
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APPLICATION - 1
ln support of this Application ldaho Power represents as folbws:
I. BACKGROUI{D
'1. Secfions 201 and 210 of PURPA, and pertinent regulatbns of the Federal
Energy Regulatory Commission ('FERC'), require that regulated electric utilities
purchase power produed by cogenemtors or small power producers that obtain
qualifying facility ('QF") status. The purchase price a QF receives for the sale of its
power is generally refened to as the avoided cost nate and is computed to be equal to
the incremental cost to an electric utility of electric energy or capacity or both, which, but
for the purchase from the QF, such utility would generate itself or purchase ftom
another sour@. The Commission has authority under PURPA Sections 201 and 21O
and the implementing regulatbns of the FERC, 18 C.F.R. S 292, to set avoided costs, b
order electric utilities to enter into fixed-term obligations for the purchase of energy from
QFs, and to implement FERC's PURPA rules.
II. THE FIRIII ENERGY SALES AGREEUENT
2. On October 13, 2010, ldaho Power and AgPower entercd into a Firm
Energy Sales Agreement ('Agreemenf) for the Facility pursuant to the terms and
oonditions of the various Commission Orders applicable to this PURPA agreement.
See, Order Nos. 304'15, 30488, 30738, and 30744. A oopy of the Agreement is
enclosed with this Application as Attachment No. 1. The Agreement is br a term of 2A
years and mntains the non-levelized published arcided cost rates established by the
Commission in Order No. 3A744 for energy deliveries of less than 10 average
megawatts ('MW").
APPLICATION.2
3. The nameplate nating of this Facility will be 1.6 t\rlVV. As defined in
paragraph 1.21 of the Agreement and as described in paragnaph 4.1.3 of the
Agrcement, AgPower will be requircd to provide data on the Facility that ldaho Power
will use to confirm that under normal ard/or average conditions the Facility will not
exceed 10 average MW on a monthly basis.
4. AgPower has elected a Scfreduled Openation Date of January 1,2O12,tor
the Facility. lf the Facility has not achievd its Operation Date by that date, Delay
Liquidated Damages and associated Delay Security provisions within this Agreement
are applicable.
5. Section 21.1 of the Agrcement pmvides that the Agreement will not
become effiective until the Commission has approved all of the Agrcemenfs terms and
conditions and declared that all payments ldaho Power makes to AgPower for
purchases of energy will be allowed as prudently incuned expensos for natemaking
purposes.
6. AgPower is cunent in the requirements of its interconnectbn process. All
applicable interconnection study charges under Schedule 72 have been assessed and
ollected from AgPower. The ftnal interconnestion Feasibility Study is complete and the
Facility Study for the Facility has been ofiered with payment due on November 17,
2010.
lll.@
7 . On March 1, 2010, in Order No. 30125 issud in Case No. GNR-E-10-01,
the Commission adopted new published avoided cost rates for the purchase by ldaho
Power of capacity energy from PURPA QFs. The rates adopted in Order No. 31025 arc
APPLICATION.3
apploximately 10 percent lower than the nates previously adopted in Case No. GNR-E-
09-01, Order No. 30744. By its terms, Order No. 31025 applies to new PURPA
contracts executed on and after March 16, 2010. Because the Agreement is dated
Oc{ober 13,2O1O, Order No. 31025 uould require that the nates to be paid AgPower
under the Agreement rvould be the rates set out in Order No. 31025 rather than the
higher rates approved by the Commission in Order No. 9074y',. However, this
Commission has recognized in prior Orders that there are situations when QF rates are
changed that it is appropriate to include a prior vintage of rates in a cunent PURPA
contrac{.I ln several cases litigated in the early to mid-1990s, the Commission
determined, and the ldaho Supreme Court affirmed, oertain criteria that a QF developer
must satisfy in order to establish an entitlement to sell energy at a particular published
avoided cost rate.2 One of the criteria that woutd qualiff a particular generating facility
to receive the superseded rate requircs that the developer have executed a power sales
agreement with the utility at the rate in question before a sucoessor rate becomes
effective. lf the QF cannot meet the first criteria, the second criteria requires that prior
to the new nates effective date, the QF developer must have filed a meritorious
complaint alleging that the prcject was sufiiciently mature and far enough along in the
contracting prooess that but br the conduct of the utility company, the developer would
have been able to sign a contrac't with the utility containing the superseded rates.
8. ln this case, AgPower had not signed a contmct with ldaho Power to
purchase the Facility gener:ation on or beforc March 16, 2010. on April 9, 2010,
r The ldaho Supreme Corrt has confirmed that it is wtthin the Commissinn's juilsdiction to
determine which vintage of QF rates strould apply to a PURPA conbac't. 8* Emp*e htmbr v.
Washington Water fuvter, 114 ldaho 191, 755 P.zd 1229 (19S8) arfr A.W. Brcwn @., htc., v. ldaho
tuvl,elr @rnpny, 121 ldaho 812, 828 P -2d U1 (1 992).
' A.W. Btriwn, Rosebu4 131 ldaho.
APPLICATION.4
AgPower filed a Complaint'at the Commission alleging that it was entitled to a @ntract
containing the higher Order No. 30744 rates. On May 5, 2010, ldaho Power filed an
Answer to AgPowe/s Complaint. Upon further reMew of the facts, and by signing this
Agreement ard roluntarily submitting it to the Commission, ldaho Power submits that
AgPower should be entitled to the nates established by Order No. 3074,4 in Case No.
GNR-E{9-01. The Company has rcceived a number of requests for "grandfathering" of
QF contnacts. ln making a determinatbn to file and support an application urging that a
particular QF project b entitled to the Order No. 30744 rates, the Gompany oncluded
that a poiect must have met the bllowing criteria:
a. lnterconnection and Tnansmission
plication; and
ii; Received and acoepted an interconnec'tion feasibility study
rcport for the proiect and paid any requested study deposits (or established credit) for
the next phase of frre interconnection process in accordane with Schedule 72; and
iia. Received mnfirmation frrom ldaho Power that transmission
capacity is available for the project and/or received and acepted tnansmission capacity
study results and cost estimates.
b. Purchase PowerAoreement
i. An agroement was materially complete prior to March 16,
2010, and except for routine ldaho Power final processing, an agreement rrvould have
been executed by both parties prior to March 16, 2010.
9. lt is ldaho Power's opinion that the AgPower Facility meets the above-
referenoed criteria, and that application of the grandfathered nate to its proiect is
APPLICATION. S
consistent with the previously approved FESAs filed by ldaho Power containing this
same gnandfathered rate. With respect to the pourrer purchase agreement criteria, in
ldaho Powe/s Answer to AgPovrrer's Complaint, (Case No. IPGE-10-11), ldaho Power
stated that it did not agree at that time with AgPower's claim that it was entitled to a
FESA containing the grandfathercd rate because AgPower had refused to agree to the
previously approved damages and security provisions that are part of the "standard"
terms ard conditions of a PURPA FESA. All other material outstanding contract issues
had been rcsolved prior to March 16, 2010. ln ldaho Powe/s opinion, the Agrcement
trould have been signed by both parties prior to March 16, 2010, except for the
disagreement as to the inclusion of the damages and security provisions of the contract.
By agreeing to the insertion and validity of those terms and signing a FESA containing
the same, AgPower's project is now similarly situated to those FESAs that have been
approrred containing gnandfathercd rates. See, @rgill, Case No. IPC-E-10-15, Oder
No. 32024; Rock Creek DaW, Case No. IPGE-10-16, Order No. 32025; Swagger
Farms Dairy, Case No. IPC-E-1G17, Order No. 32026; Double B Dairy, Case No. IPG
E-10-18, Order No. 32027; and Grand View Solar, Case No. IPGE-10-19, Order No.
32068. As a result, the Facili$ should qualifu for a oontnact including the Order No.
fi744 nates.
10. The Agrcement contains the most recent terms and conditions, including
the liquidated damages and securtg 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 Agrcement mets
the criteria established by the Commission in its prior Orders and the Commission
should approve the Agreement as presentd.
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12. ldaho Power believes that a hearing is not necessary to consider the
issues presented herein and respectfully requests that this Application be proessed
under Modified Proedure, i.e., by written submissions nather than by hearirg. RP 201,
ef seg. lf, however, the Commissbn determines that a technical hearing is requircd, the
Company strands ready to present its testimony and support the Application in sucft
hearing.
V. COHiIUNICATIONS AND SERVICE OF PLEADINGS
13. Communications and seMce of pleadings, exhibits, oFderB, and other
documents relating to this proceeding stpuld be sent to the following:
Donovan E. Walker, Senior Counse!
Lisa Nordstrom, Lead Counse!
ldaho Power Company
1221 West ldaho Strcet
P.O. Box 70
Boise, ldaho 837OT
dwal kel{@ idahooower.com
lno rdstrom@ida hopower. co m
Randy C. Allphin
Energy Co ntrac't Adminisfrator
ldaho Power Gompany
1221 West ldaho Street
P.O. Box 70
Boise, ldaho 83701
rallohin@idahooower. com
VI. REQUEST FOR RELIEF
14. ldaho Power Company rcspectfully requests that the Commission issue
an Order: (1) authorizing that this matter may be prccessed by Modifted Prooedurc; (2)
approving the Firm Energy Sales Agreement between ldaho Power Company and
AgPower Jerome, LLC, without charge or condition; and (3) declaring that all payments
for purchases of eneruy under the Firm Energy Sales Agreement between ldaho Pourcr
APPLICATION. T
Company and AgPower Jelome, LLC, be albrrcd as prudently incuned expenses for
ratemaking purposes.
Respa'lfirlly submitbd this 20s day of Gober 2O1O.
E. WALKER
Attomy for ldaho Power
APPLICATION -8
CERNFEATE OF TAILING
I HEREBY CERTIFY that on the 20h day of October 2Afi I served a true and
conect copy of the foregoing APPLICATION upon the following named parties by the
method indicated below, and addressed to the following:
AgPower Jerome, LLC Hand Delh,Brod
Jim Wiest, Manager X U.S. t\,lail
AgPower Jerome, LLC Ovemight Mail
10475 East Park Meadows Drive, Suite 600 FA)(
Lone Tree, Colorado 80124 Ernail
Peter J. Richardson
Gregory M. Adams
RICHARDSON & O'LEARY
515 Norttr 27h Strget
P.O. Box 72'18
Boise, ldaho 83702
Hand DeliveredX U.S. Mail
Ovemight Mail
FA)(X Email [e-mail]
greo @richadsonandolearv.co m
E. Walker
APPLICATION -9
BEFORE THE
IDAHO PUBLIG UTILITIES COMMISSION
cAsE NO. IPC-E-10-26
IDAHO POWER COMPANY
ATTACHMENT NO. 1
FIRM ENERGY SALES AGREEMENT
BETWEEN
IDAHO POWERCOMPAT\TY
Al.lD
AGPOWERJEROME, LLC
TABLE OF CONTENTS
Article
I
2
3
4
5
6
7
8
9
10
l1
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t4
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t7
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29
TTTLE
Definitions
No Reliance on Idaho Power
Warranties
Conditions to Acceptancc of Energr
Term and Operation Date
Purchase and Sale ofNa Energy
Purchase Prie and Method of Palment
Environmental Attributes
Facility and Interconnection
Metering and Tele,metry
Records
Operatious
Indemnifi cation and Insurance
Force Majeure
Liability; Dedication
Several Obligations
Waiver
Choice of Laws andVaue
Disputes and Default
Govemmental Authorization
Commission Orrder
Successors andAssigns
Modification
Taxes
Notices
Additional Temns and Conditions
Severability
Counterparts
Entire Agreement Signatures
Appendix A
AppendixB
AppendixC
AppendixD
l0-7-20t0
FIRM ENERGY SALES AGREEMENT
(10 aI\dW or Less)
Pmject Name: Elouble A Digester ProjCIct
Pnoject Numben 3 I 6161 l0
THIS AGREEMENT, entered into on this _ day of October 2010 betwesn AgPowa Jerome,LLC,
a Delaware limitd liability company (Seller), and IDAIIO POWER COMPAI.IY, an Idaho corporation (Idaho
Power), hereinaftsr sometimc re rrd to collectively as '?arties" or individually as "Party."
WTINESSETH:
WHEREAS, Seller will desip, coostruct, ovrn, maintain and operate an elcctic gene,ration facility; and
WHEREAS, Seller wishes to sell, and Idaho Power is willing to purchase, firm elwtric energ5r produced
by the Seller's Facility.
THEREFORE, In consideration of the mutual covenants and agreements hreinafter set fb:rth, the
Parties agree as follows:
ARTICLE I: DEF.INITIONS
As used in this Agreeinent mdthe appendices attached hereto, the following terms
shall have the following meanings:
1.1 "EASgjUgSfl - Monthly Net Energy less than 1 10% of the monthly Net Energy Amount as specified
in paragraph 6.2 ofthis Agree,rnent.
1.2 *Commisgign" - The Idaho Public Utilities Commission.
1.3 "ConfractJ@C' - The period commencing each calendar year on the same calendar date as the
Operation Date and ending 364 days thseafter.
1.4 "Delay Liquidated Damages'- Damages payable to ldaho Power as calculated in paragraph 5.3,5.4,
5.5, 5.6 and 5.8.
1
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1.5 "DelaLPeriod" - All days past the Scheduld Operation Date until the Seller's Facility achiwes the
OperationDate.
"Dslay Prigg" - The culr€ot month's Mid{olumbia Market Energy Cost minus the cunent month's All
Hours Energy Price specified in paragraph 7.3 of this Agreement. If this calculation results in a value
lsss than 0, the result ofthis calculation will be 0.
"Designated Dispatch Facilitv" - Idaho Power's Systems Operations Group, orany subsequent group
designated by ldaho Power.
"Fegill$fl - That elecric generation facility described in Appendix B ofthis Age€m€nt.
"First Energy Dateu - The day eommencing at 00:01 hours, Mouotain Time, following the day tha!
Seller has satisfied the requirements of Article tV and the Seller begins delivering energr to Idaho
Power's system at the Point of Delivery.
"HggUf.-IAAAHeulg" - The daily hours beginning at 7:00 am, ending at I I :00 pm Mountain Time, (t 6
hours) excluding all hours on all Sundays, New Years Day, Me,morial Day, Independence Day, Labor
Day, Thanlsgrving and Christmas.
"Inadverten't-Energy" - Elechic energy Seller does not intend to genefiate. Inadvertent eoergy is more
particularly described in paragraph 7.5 of this Agreement.
"Intercornection Facilities" - All equipment specified in Schedule 72.
"Initial Capacitv Determinatiod'- The process by which Idaho Power confirms that under normal or
average design conditions the Facility will generate at no more than 10 average MW per month and is
therefore eligible to be paid the published rates in accordance with Commission ffier No.29632.
"Ligbl.oed llqrs" - The daily hours beginning at 1l:00 prn, ending at 7:00 am Mormtain Time (8
hours), plus all otherhours on all Sundays, New Years Day, Memorial Day, Independence Day, Labor
Day, Thanksgling and Christmas.
6'Irsses" - The loss of electrical energy e:rpressed in kilowatt hours (kWh) occuning as a result of the
hnsformation and transmission of energy betwea the point wherc the Facility's en€rg)/ is meterred and
the point the Facility's energy is delivered to the Idaho Power electrical system. The loss calculation
formula will be as specified in Appendix B of this Agreemeint.
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1.6
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1.8
1.9
1.10
1.11
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1.15
1.16 "MarLet Enerw Referene Price" - Eighty-five perceirt (85olo) of the Mid{oltrmbia Market Energy
Cost.
l.l7 *MaterialBlEgEh"-ADefault(paragraph 19.2.1) subjecttoparagraph 19.2.2.
1.18 "Ma:rimum Capacity Amounf'- The maximum capacity (MlY) of the Facility will be as s@fied in
B of this Agreement.
1.19 "Iv[gte, ing_EggjpEg@{ - All equipment specified in Schedule T2,this Agreement and any additioaal
equipmeut specified in Appendix B requiredto measutre, record andtelemeterbi directional power
flows betwen the Selleds electric ge,neration plant and Idaho Poweds system.
L.20 "Mid- ColumbiaMarkgt Enerry Cost" -The monthlyweighted ave,rage of the daily on-peak and off-
peak Dow Jones Mid-Columbia Index @ow Jones Mid-C Index) prices for non-firm cnergy. If the Dow
Jones Mid{olumbia lndex price is discontinued by the reporting agency, both Parties will mutually
agree upon a replacement index, which is similar to the Dow Jones Mid{olumbia Index. The selected
replacement index will be consistent with other similar agreements and a commonly used index by the
electrical industy.
1.21 "I\kqe!&-ea@!!t'' -The full-load electrical quantities assigned by the designer to a generator and its
prime mover or other piece of eloctrical equipment, zuch as hansfomrers and circuit breakers, under
staodardized conditions, orpressed in amperes, kilovolt-ampercrs, kilowatts, volts or other appropriate
units. Usually indicated on a nameplate attached to the individual machine or device.
1.22 "trIe!-Euergy" - All of the electric eoergy produced by the Facility, less Station Use, less Losses,
expressed in kilowatt hours ftWh). Subject to the terms ofthis Agreement, Seller commits to deliver all
Net Enerryto Idaho Power at the Point of Delivery for the full term of the Agreement. Net Energy does
not include Inadvertent Energy.
1.23 *@ration Date' - The day commencing at 00:01 hours, Mountain Time, following the day that dl
requireme,nts of paragr4h 5.2 havebon complded.
1.24 "Iqintof,Dsliyely" - The location specified in Appendix B, where Idaho Power's and the Seller's
elechical facilities are int€rconnected and the eoerry from this Facility is delive,red to the Idaho Power
electricals,stem'
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1.25 "Prudent Elecffical Practices'- Those practices, methods and equipment tbat are commonly and
ordinarily used in electrical engineering and operations to operate elec'tric equipment lawfully, safely,
dependably, efficiently and economically.
L.26 "Schduled Operation Date" - The date specified in Appendix B when Seller anticipates achieving the
Operation Date. It is expected that the Scheduled Operation Date provided by the Scller shall be a
reasonable estimate of the date that the Seller anticipate that the Seller's Facility shall achieve the
Operation Date.
1.27 "Schedule 72" - Idaho Power's TariffNo 101, Schedule 72 or its suocessor schedules as approved by
the Commissim. The Seller shall be responsible to pay all costs of intercornection and integration of
this Facility into the Idaho Power electrical system as specified within Schodule 72.
1.28 "Season" - The three periods identified in paragraph 6.2.1 of this Agreement.
l.2g "SEial Facilities". - Additions or alterations of transmission and/or distribution lines and hansformers
as described in Sche&rle 72.
1.30 "Ststion Use" - Electric energy that is used to op€rate equipment that is auxiliary or otherwise related to
the production of electricity by the Facility.
1.31 'Sudus.laergt''- Is (l) Net Energy produced by the Seller's Facility and delivered to the Idaho Power
electrical syst€m during the montl which exceeds I 10olo of the monthly Net Eneqgy Amount for the
corresponding month specified in paragraph 6.2. or (2) If the Net Eneqg5r produced by the Seller's
Facility and delivered to the Idaho Power electrical system during the monttr is less than 90% of the
monthly Net Energy Amount for the corresponding month specified in paragraph 6.2, then all Net
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
syst€m priorto the Operation Date.
1.32 '@'- The total cost of structures, equipment aod ap,purtenances.
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2.1
ARTICLE tr: NO RELIANCE ON IDAIIO POWER
Seller Indcpendeirt Investigation - Seller warrants and reptesents to Idaho Power that in entering into
this Ageemeirt and the und€rtaking by Seller of the obligations set forth herele Seller has investigated
and daermined that it is capable of performing hereundcr aad has not relied upon the advice,
experience or expertise of Idaho Power in connection with the transactions conternplated by this
Agreement.
Seller Independmt Experts - All professionals or experts including but not limitd to, e,ngineers,
attorneys or accouutants, that Seller may have consulted or relied on in und€fiakiry the transactions
contemplated by this Agreement have been solelythose of Seller.
ARTICLE Itr: WARRA}.ITIES
No Waranty by Idaho Power - Any review, ac@ptanco or failure to review Seller's design,
specifications, equipmeirt or facilities shall not be an endorsernent or a confirmation by Idaho Power and
Idaho Power makes no warranties, expressed or implie{ regarding any aspest of Seller's design,
specifications, equipme,nt or facilities, including, but not limitedto, safety, durability, reliability,
strength, capacrty, adequacy or economic feasibility.
Oualiffing Facility Status - Seller warrants that the Facility is a *Qualiffing Facility," as that term is
used and defined in 18 CFR 292.2U et seq. After initial qualification, Sellerwill take such st€ps as may
be rquired to maintain the Facility's Qudi$nng Facility status during the term of this Agreement and
Seller's failure to maintain Quali&ing Facility status will be a Material Breach of this Agree'ment.
Idaho Power r€serves the right to review the Facility's Quali&ing Facility status and associated support
and compliance documents at anytime during the term of this Agreement.
ARTICLE IV: CONDITIONS TO ACCEPTANCE OF ENERGY
Prior to the First Energy Date and as a condition of Idaho Power's acceptance of deliveries of energy
from the Seller under this Agreement, Seller shall:
2.2
3.1
3.2
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4.1.1
4.t.2
4.1.3
Submit proof to Idaho Power that all lioenses, permits or approvals necessary for Seller's
op€rations have been obtained from applicable federal, state or local authorities, including, but
not limited to, evidence of compliance with Subpart B, 18 CFR 292.201et seq. as a certified
Qualiffing Facility.
Opinion of Counsel - Submit to ldaho Power an Opinion [rtter signed by an attorney admitted
to pmactice and in good standing in the State of Idaho providing an opinion that Sell€r's licenses,
permits atd approvals as sct forth in paragraph 4.1.1 above are legally and validly issued, 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 compliance with said permits as of the date of the Opinion
Lett€r. The Opinion lrtterwifl be in a form acceptableto Idaho Power and will acknowledge
that the attonrey rcndering the opinion understancls that Idsho Power is relying on said opinion
Idaho Power's acceptance ofthc form will not be uilEasonably withheld. The Opinion frtl'at
will be governed by and shall be interpreted in accordance with the legal opinion accord ofthe
American Bar Association Section of Business taw (1991).
Initial Capacity Determination - Submit to Idaho Power such data as Idaho Power may
reasonably require to perform the Initial Capacity Determination. Such data will include but not
be limited to, Nameplate Capacity, equipment specifications, prime mover data, r€source
characteristics, notmal and/or average operating design conditions and Station Use data. Upon
receipt of this infomation, Idaho Power will review the provided data and if necessary, r€quest
additional data to complete the Initial Capacity Determination within a reasonable time.
4.1.3.1 If the Maximum Capacity specified in Appeirdix B of this Age€m€nt and the
cumulative manufacture Nameplate Capacity rating of the individual gene,lation units at
this Facility is less than l0 MW. The Seller shall submit detaild, manufacturer,
verifiable data ofthe Nameplate Capacity ratings ofthe actual fudividual generation
units to be installd at this Facility. Upon verification by Idaho Power that the data
provided establishes the combinod Nameplate Capacity rating of the generation units to
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be installed at this Facility is less than l0 MW, it will be deemed tbat the Sellerhas
satisfied the Initial Capacity Determination for this Facility.
4.1,4 Nameplate Capacity - Submit to ldaho Power manufacturer's and eirgineering documentation
that establishes the Nameplate Capacrty of each individual gene,ration unit that is included
within this entire Facility. Upon receipt ofthis data, Idaho Power shall review the prcvided daa
and detennine if the Nameplate Capacity specified is reasonable based upon the manufacturer's
specified generation ratings for the specific generatiou units.
4.1.5 Eogineer's Certifications - Submit an executed Engineeds Certification of Desigtr&
Constnrction Adequacy and an Fngineeds Certification of Operations and Mainteoance (O&M)
Policy as described in Commission Order No. 21690.. These certificatcs will be in the form
specified in Appendix C but may be modified to the extent nscessary to recognize the different
eogineering disciplines pnoviding the certificates.
4.1.6 Insurance - Submit writteoproof to Idaho Power of all insurance requird in Article XItr.
4.1.7 Interconnection - Provide written confirmation from ldaho Power's delivery business unit that
Seller has satisfied all intercornection requirements.
4.1.8 Network Resource Designation * The Seller's Facility has becn designated as a networt
nesourse capable of delivering firm c,nergy up to the amount of the Maximum Capacity.
4.1.9 Written Acce,ptance - Request and obtain written confimration &om Idaho Power that all
conditions to acc€ptance of energy have been fulfiltd. Such written confirmation shalt be
provided within a commercially rcasonable time following the Seller's request and will not be
unreasonably withheld by Idaho Power.
4.2 The Seller may terminate this agreement with no damages or penalties by providing writte,n notice to
Idaho Power within 30 days of the later of l) the final Facility Study and/or 2) notification from Idaho
Power of any required transmission network upgrade costs. This right to terminate shall expire if it not
acted upon by the Seller within the 30 days specified above.
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ARTICLE V: TERM AND OPERATION DATE
5.1 Term - Subjec,t to the provisions of paragraph 5.2 below, this Agreement shall become effective on the
date first writte,n and shall continue in fuU force and effect for a period of 20 Contract Yean ftom the
OperationDate,
5.2 Operation Date - The Operation Date may occur only after the Facility has achiored all of the following:
a) Achiwed the First Energy Date.
b) Commission approval of this Agreement in a form acceptable to Idaho Power has beelt
roceived-
c) Seller has demonstrated to Idaho Power's satisfaction that the Facility is complete and able
to provide €nergly in a consistent, reliable and safe manner.
d) Seller has requested an Operation Date from ldaho Power in a written format.
e) Seller has received written confirmation from Idaho Power of the Operation Date. This
confirmation will not be ureasonabtvwithheldby Idaho Power.
5.3 Operafion Date Delay - Seller shall cause the Facility to achiwe the Operation Date on or before the
Scheduled Operation Date. Delap in the intcrconnection and transmission network upgrade study, design
and constnrction process that rre not Force Majeure events accepted by both Parties, thrll not prevent
Delay Liquidated Damages from being due and owing as calculated in accordance with this Agreemeirt.
5.3.1 If the Operation Date occurs after the Scheduled Operation Date but on or prior to 90 days
following the Scheduled Operation Date, Seller shall pay Idaho Power Delay Liquidated
Damages calculated at the end of each calendar month after the Scheduled Operatiott Date as
follows:
Delay Liquidated Damages arc equal to (Current month's tdtial Year Net Energy
Amount as specified in paragraph 62.1 divided by the number of days in the current
month) multiplied by the number of days in the Delay P€riod in the curr€nt month)
multiplied by the cument month's Delay Price.
5-3.2 If the Operation Date does not occurwithin ninety (90) days following the Scheduled Operation
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5.4
Date the Seller shcll pay ldalro Power Delay Liquidatd Damages, iu addition to those p,rovidd
in paragraph 5.3.1, calculated as follows:
Forty five dollars ($45) multiplied by the Ma:rimum Capacity with the Maximum
Capacity being measured in kW.
If Seller fails to achieve the Operatioar Date within ninery (90) days following the Scheduled Operation
Date, such failure will b€ a Material Breach aod ldaho Power may terminate this Agreement at any time
until the Seller cures the Material Breach. Additional Detay 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 excoeding 90 days past the Scheduled Operation Date
until such time as the Seller cures this Material Breach or Idaho Power terminates this Agre€m€nt.
Seller shall pay ldaho Power any calculated Delay Damages or Delay Liquidated Damages within 7
days of when Idaho Power calculates and prresents any Delay Damages or Delay Liquidated Damages
billings to the Seller. Seller's failure to pay these damages within the specified time will be a Material
Breach of this Agreement and ldaho Power shall draw funds from the Delay Security provided by the
Seller in an amount equal to the calculated Delay Damages or Delay Liquidatd Damages.
The Parties agree that the damages Idaho Power would incur due to delay in the Facility achieving the
Operation Date on or before the Scheduled Operation Date would be difficult or impossible to predict
with certainty, and that the Delay Liquidated Damages are an appropriate approximation of such
damages.
Prior to the Seller executing this Agreement, the Seller shall have agrecd to and executed a lrtter of
Undsrstanding with Idaho Power that contains at minimum the following requirements:
a) Seller has filed for interconnection and is in compliance with all palments and
requirements of the interconnection process
b) Seller has received and accepted an interconnection feasibility study for this
Facility.
c) Seller has provided all infonnation required to enable Idaho Power to file an initial
transmission capacity request.
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5.5
5.6
5.7
5.8
d) Results of the initial transmission capaclty rcquet are known and acceptable to the
Seller.
e) Seller acknowledges responsibility for all interconnectioc costs and any costs
associated with acqtriring adequate firm transmission capacity to e'nable the prcjed
to be classifid as an Idaho Power firm netwo* resouroo.
0 If the Facility is located outside of the Idaho Power service temitory, in addition to
the above requirem€nts, the Seller must provide evidence that the Seller has
acquired firm transmission capacity from all requirod entities to delivcr
the Facility's energpr to an acceptable point of delivery on the Idaho Power
electrical systern.
Within thirty (30) days of the date of a final non-appealable order as specified in futicle )Ofl approving
this fureemeot the Seller shall post liquid security ('Delay Securiff) in a form as described in
Appeodix D eqrral to or excding the amount calculated in paragraph 5.8.1.
5.8.1 Delay Securitv The greater of forty five ($afl multiplied by the Maximum Capacity with the
Maximum Capacity being measured in kW or thc sum of three month's estimated raeoue.
Where the estimated three months of reve,nue is the estimated neverue associated with the first
three full months following the estimated Scheduld Operation Date, the estimated kWh of
€n€rgy production as qpecified in paragraph 6.2.1 for those throe months 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 ldaho Power with certification that (l) a generation
interconnoction agreement specirying a schedule that will enable this Facility to achieve
the Ope,ration Date no later than the Scheduled Operation Date has beelr cornpleted and
the Seller has paid all rquired interconnection costs or (2) a generation inte,rconnection
agreement is substantially corrplete and all material costs of interconnec,tion have been
identified and agreed upon and the Seller is in compliance with all terms and
conditions of the geireration interconnegtion agreement, the Dclay Securi$ calculatd
in accorrdance with paragraph 5.8.1 will be rducd by teo pcrcent (10,o/o).
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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 r€qust, the ge,lreration
interconnection agreement specified in paragraph 5.8.1.1 is revised and as a result the
Facility will not achieve its Operation Date by the Scheduled Operation Date or (2) if
the Seller does not maintain compliance with the generation interconnoction agrcemeot,
the full amount of the Delay Security as calculated in paragraph 5.8.1 will be subject to
reinstat€m€nt and will be due aud owing within 5 business dap from the date ldaho
Power requests reinstaternent. Failure to timely reinstate the Delay Security will be a
Material Breach of this Agreement.
5.8.2 Idaho Power shall release any remaining sccurity posted hereund€r after all calculatd Delay Dartages
and/or Delay Liquidatcd pamages are paid in full to Idaho Power and the earlier of (1) 30 days after the
Operation Date has bwn achieved or (2) 60 days after the Agree,meirt has been terminated.
6.1
6.2
ARTICLE VI: P{JRCIIASE AND SALE OF NET ENERGY
DeliveryandAcoeptanceofNetEnergy -Except when either Party's perfonnance is excud as
provided herein, Idaho Power witl purchase and Seller will sell all of the Net Energy to Idaho Power at
the Point of Delivery. All Inadvertent Eneqgy 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 Energy and/or
Inadvertent Energy produced by the Facility and delivered by the Seller to the Point of Delivery exceed
the Maximum Capacity Amount.
NetEnergyAmounts - Seller intends to produce and deliver Net Enerry in the following monthly
amouuts:
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6.2.1 Initial Year Monthlv Net Eaergy Amounts:
Month
Season I
March
April
May
Season 2
July
August
November
December
June
September
Octob€r
January
February
kwh
2,484,4N
2,4g4,Aoo
2484,W0
2,484,0W
2,484,A00
2.484,000
2,494,000
2,4g4,ooo
2,484,W0
2,494,000
2,484,M
2,484,0W
6.2.2
6.2.3
Season 3
Ongoing Monlhly Net En€rey Amoupts - Seller shall initially provide Idaho Power with one
year of monthly generation estirnates (Initial Year Monthly Net Energy Amounts) and
begiming at the end of month nine aad every three months tkreafter provide l&ho Power vrith
an additional three months of forward gpo€ration estimates beyond those generation estimates
previously provided. This information will be provided to Idaho Power by written notice in
accordance with paragraph 25.1, no later than 5:ffi PM of the 56 day following the end of the
previous month. If the Seller does not provide the Ongoing Monthly Net Energy Amouats in a
timely mann€il', Idaho Power will use the most recent 3 months of the Initial Year Monthly Net
Eneryy Amounts specified in paragraph 6.2.1 for the next 3 months of monthly Net Energy
amounts.
Seller's Adjustueirt of Net Enerty Amount
6.2.3.1 No later than the Operation Date, by written notice given to ldaho Power in accordance
with paragraph 25.1, the Seller may revise all of the prwiously provided Initial Year
Monthly Net Energy Amounts.
6.2.3.2 Beginning with the end of the 9th month after the Openation Date aud at the end of
every third month thereaftec (l) the Seller may not revise the immediate next thrce
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6.2.4
months of previously provided Net Enerry Amounts, (2) but by written notice giveir to
Idaho Power in accordance with paragraph 25.1, no later tban 5:00 PM of the 56 day
following the end of the previous month, the Seller may revise all other previously
providd Net Energy Anounts. Failure to provide timely writteir notice of changed
amounts will be deemedtobe an election ofno change.
Idaho Power Adjustmelrt of N.et Energy Amount - If Idaho Power is excused fiom acceptiag the
Seller's Net Energy as specified in paragraph 12.2.L or if the Seller declares a Suspension of
Energy Deliveries as specified in paragraph 12.3.1 and the Seller's d€clax€d Suspension of
Energy Deliveries is accepted by ldaho Power, the Net Ene,qgy Amount as specified in
paragraph 6.2 for the specific month in which the rcduction or suspe,nsion under paragraph
12.2.1 or 12.3.1 occurs will be reduced in accordance with the following:
Where:
NEA Curreot 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 paragraph 12.2.1 this value will be
equal to the perce,ntage of curtailment as specified by
Idaho Power multiplied by the TGU as defined below.
b.) If the Seller declares a Suspension of Energy Deliveries as
specified in paragraph 12.3.1 this value will be the sum of
the individual generation units size ratings as sp*ified in
Appendix B that are impacted bythe circumstances
causing the Seller to declare a Suspe,nsion of Energy
Deliveries.
TGU Sum of all of the individual gene,rator ratings of the gelreration
units at this Facility as specified in Appendix B of this
agreemeot.
RSH = Achral 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 curreirt montb
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TH
Resultins formula beins:
Adiusted
Nei Bnergy : NEA
Amount TGU
6.3
This Adjusted Net Energy Amount will be used in applicable Strplus Energy calculations for only the
specific month in which Idaho Power was exeused from aoce,pting the Seller's Net Energy or the Seller
declard a Suspension ofEnergy.
Unless excused by an event of Forrce Majeure, Seller's failure to deliver Net Eneqgy in any Conhact
Year in an amoutrt equal to at least ten percent (l0o/o) of the sum of the Initial Year Nct Energy
Amounts as spocifiod in paragraph 6.2 shall constihfie an event of default.
ARTICLE Vtr: PI.JRCIIASE PRICE A}.ID METTIOD OF PAYMENT
7.1 Base EnereyHeaw Load huchase Price - For all Base Energy received dudng Heavy Ioad Hotrs,
Idaho Power will pay the non-levelized encrgy price in accordance with Commission Order 30744,
30738 and adjuted in accordaace with Commission Order 30415 for Heavy load Hour Eneqgy
deliveries with seasonalization factors appliod:
((x NEA ) x( rr{ ) )
Yeer
2010
201 l
2012
2013
20r4
2015
2016
2017
2018
2019
2020
202t
2022
2023
2424
202s
2026
202t
Season I -Q3SOYA
Milts/kWh
57.98
59.54
6t.22
62.62
64.0s
65.52
67.10
68.63
70.29
71.91
73.56
75.26
76.99
78.78
80.60
82.47
84.7s
87.10
Season 2-(120.A0%\
Mills/kWh
94.67
97.21
99.95
102.23
104.57
106.97
109.55
I12.05
t14.77
t17.40
120.10
122.87
125.70
128.61
131.59
134.65
138.37
142.21
Searcn3-(100.0070)
MiltslBwh
78.89
81.01
83.29
85.19
87.14
89.14
91.29
93.38
95.64
97.83
100.08
rcz39
rc4.75
107.18
109.66
tt2-21
l1s.3l
I18.51
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2028
2029
2030
2031
89.53
92.03
94.60
96.69
146.17
150.25
t54.45
157.85
121.81
tzs.2t
128.71
131.55
7.2 Base Energ.v Light Ipad Purchase Price - For all Base Energy received during Light l,oad Hotus, Idaho
Power will pay the non-levehzdenagyprice in accordance with Commission mer 3W44,30738 aod
adjusted in accordance with Commission frer 30415 for Light Load Hour Enerry deliveries with
seasonalization factors applied :
Year
20to
2011
20t2
2013
2014
2015
24rc
2017
2018
20r9
2020
2021
2022
2423
2024
2025
2026
2027
2028
2029
2030
2031
Season l -(73.5AVo)
Millykwh
52.63
54.19
s5.87
57.27
58.70
60.17
6t.?5
63.28
64.94
66.56
68.21
69.90
71.64
73.42
75.25
77.t2
79.40
81.75
84.18
86.68
89.2s
91.33
Seasou2 - (120.00 7o)
Mttls/kWh
85.93
88.47
9r.21
93.49
95.83
98.23
100.81
1o3.32
106.03
108.66
111.36
114.13
,t6.97
I19.88
122.86
t2s.9t
129.64
133.48
137.43
t4l.5l
145.71
149.12
Season3-(100.00o/o)
Mitts/kWh
71.61
73.73
76.01
77.9t
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
ttt.23
114.53
117.93
r21.43
124.27
7.3 All Hours Enerqy Price - The price to be used in the calculation of the Surplus Energy Price and Delay
Damage Price shall be the non-levelized en€rgy price in accordance with Commission Onder 3074d- alrd
30738 with seasonalization factors applied:
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Yeer
2010
20tt
2012
2At3
20t4
2015
20t6
2017
2018
2019
2020
202t
2022
2023
20u
2025
2026
2027
2028
2029
2430
2031
Season I - (73.50YA
Mlllg/k$/h
s5.60
57 "t6
58.84
60.24
61.67
63.14
64.72
66.25
67.91
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
Season 2 -(120.00Yo)
MillsftWh
90.78
93.32
96.06
98.34
100.68
103.08
105.66
108.17
I10.88
I13.51
tt6.2t
118,98
t21.82
124.72
127.71
130.76
134.49
138.32
t42.28
146.36
150.56
153.97
Season3-(l00.@70)
Mille/kWh
75.65
77.77
80.05
81.95
83.90
85.90
88.05
90.14
92.N
94.59
96.84
99.1s
101.51
103.94
|ffi.42
108.97
n2.07
115.27
1r 8.57
12r.97
12s.47
128.31
7.4
7.5
Surplus Enersv Price - For all Surplus Energy, Idaho Power shall pay to the Seller the current month's
Ma*et Energy Reference Price or the All Hours Energy Price specifiod in paragraph 7.3, whicbener is
lower.
lnadverteirt Enerey-
7.5.1 Inadvertent Eneqgy is electric 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 io the specific month in which the e,nergy was delivered- @or exaople
January contains 744 hours. 744 hours times 10,000 kW = 7,440no0 kWh. Energy
delivered in January in excess of 7 ,440,000 kwh in this example would be Inadvertcnt
Energy.)
7.5.2 Although Seller intends to design and operate the Facility to ge,lrerate no more than
l0 average MW and therefore does not intend to generate lnadvertent Ene4g5r, Idaho Power
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7.6
7.7
8.1
9.1
will accept Inadvertent Energy that does not exceed the Maximum Capacity Amount but
will not purchase or pay for Inadverte,lrt Energy.
Payne,nt Due Date - Undisputed Enecry pqmrcnts, less any pa)4nents due to Idaho Power will be
disbursed to the Seller within 30 days of the date which Idaho Power receives aod accepts the
documentation of the monthly Net Energy actually delivered to Idaho Power as spedfiod in
AppendixA.
Continuing Jurisdiction ofthe Commission -This Agreement is a special coatac-t an4 as such, the rates,
terms and conditions contained in this Agreerrent will be construed in accordaace with Idaho Power
Company v. Idaho Public Utilities Commission and Afton Energy. tnc., 107 Idaho 781, 693 P'.zd 427
(1984), Idaho Power Company v. Idaho Public Utilities Commission. 107 Idaho 1122,695 P.2d | 261
(1985), Afton Energy. Inc. v. Idaho Power Co,mpany, 1l I Idaho 925,729 P.2d 400 (1986), Section 210
of the Public Utilities Regulatory Policies Act of 1978 and l8 CFR $292.303-308
ARTICLE VItr: ENVIRONMEMAL ATTRIBUTES
Seller raains ownership under this Agreement of Green Tags, Renewable Energy Certificate (RECs),
carbon credits, or the equivalent e,nvironmental attributes, directly associated with the production of
energy from the Selleds Facility sold to ldaho Power.
ARTICLE D(: FACILITY AND INTERCONNECTION
Design of Facilitv - Sellerwill desig!, construct, install, own, operate and maintain the Facility md any
Seller-owned Interconnection Facilities so as to allow safe and reliable generation and delivery of Net
Energy and Inadvertent Energy to the Idaho Power Point of Delivery for the full term of the Agreement.
ARTICLE X: METERING AND TELEMETRY
Metering - Idaho Power shall, forthe account of Seller, provide install, and maintain Metering
Equipment to be located at a mutually agreed upon location to record and measure power flows to ldaho
Power in accordance with this Agreement and Schedule 72. \\e Metering Equipment will be at the
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10.1
location and the tpe required to measure, record and report the Facility's Net Energy, Station Use,
Inadvertent Encqgy and maximum eoergf deliveries (kW) at the Point of Delivery in a manner to
provide Idaho Power adeqrate eoergy measurement data to administer this Agreemeirt and to integrate
this Facility's energy production into the Idaho Power electrical system.
10.2 Telemetrv- Idaho Power will install, ope,rate and maintain at Selleds expense communications and
tele,metry equipment which will be capable of pnoviding Idaho Power with continuous instantaneous
telemetry of Selleds Na Energy aud Inadvertent Eneqgyproduced and deliveredto the Idaho Power
Point of Delivery to Idaho Powe,r's Designated Dispatch Facility.
ARTICLE XI - RECORDS
11.1 Maintemance of Records - Seller shall maintain at the Facility or such other location mutually acceptable
to the Parties adequate total generation, Net Energy, Station Use, Inadvertent Energy and maximum
generation ftW) records in a form and conte,lrt acceptable to ldaho Power.
ll.2 Insoection - 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, Inadvertent Energ5r
and maximum generation (kW) records pertaining to the Seller's Facility.
t2.t
12.2
ARTICLE Xtr: OPERATIONS
Commuoications - Idaho Power and the Seller shall maintain appropriate operating communications
through Idaho Power's Designated Dispatch Facility in accordance with Appendix A of this Agreement.
Enerty Accqptance -
12.2.1 ldaho Power shall be excused from accepting and paying for Net Energy or accepting
Inadvertent Energy which would have otherwise been produced by the Facility and delivered 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. If, for
rcasons other than an went of Force Majeure, a temporary disconnection under Schedule 72
exceeds twenty (20) days, beginning with the rwenty-first day of such internrption, curtailment
- 18-
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or reduction, Selter will be deemed to be delivering Net Energy at a rate oquivalent to tle pro
rata daily average of the amounts specifred for the applicable month in paragreph 6.2. Idaho
Power will notiff Seller when the intemrytion, curtailm€nt or re&rction is terminated.
12.2,2 If, in the reasonable opinion of Idaho Power, Selleds operation of the Facility or Interconnection
Facilities is unsafe or may otherwise adversely affect Idaho Poweds equipme,lrt, personnel or
service to its customers, Idaho Power may temporarily disconnect the Facfity from Idaho
Pow€,r's transmission/distribution s)6tcm as specified within Schedule 72 or take zuch o&er
reasonable steps as Idaho Power deems ap'propriate.
12.2.3 Ufier no circumstances will the Seller deliver Net Euergy and/or Inadvertent Energy from the
Facility to the Point of Delivery in an amount that exceeds the Ma:rimum Capacity Amount.
Seller's failure to limit deliveries to the Maximum Capacrty Amount will be a Material Breach
ofthis Agree,ment.
12.2.4 If Idaho Power is unable to accept the energy fum this Facility and is not excused fiom
accepting the Facility's energy, Idaho Poweros 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 reve,nue or consegtrential damages the Facility may
incru.
12.3 Seller Dgclared Susoension of Eneruv Deliveries
12.3.1 If the Seller's Facility experiences a forced outage due to oquipment failure which is not caused
by an eveirt of Force Majeure or by neglect, disre,pair or lack of adequate preventative
mainteoanc€ of the Seller's Facility, Seller may, after giving notice as provided in paragraph
12.3.2 below, temporarily suspend all deliveries of Net Energy to Idalro Power from the Facility
or from individual generation uni(s) within the Facility impacted by the foroed outage for a
p€riod of not less than 48 hours to corect the forced outage condition ('Declared Suqpension 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 in paragraph
12.3.2 ard, will continue for the time as specifred (not less than 48 houn) in the written
- 19- rct,norc
notification provided by the Seller. In the month(s) in which the Declared Suspension of Energy
occurreq the Net Energy Amount will be adjusted as spe,cified in paragraph 62.4.
12.3,2 If the Seller desires to initiafe a Declared Suspension of Energy Deliveries as p,rovided in
paragraph 12.3.1, the Seller will notifr the Designated Dispatch Facility by telephone. The
beginning hour of the DeclaxCId Suqpension of Energr Deliveries will be at the earliest the next
full hour after making telephone coilact with Idaho Pou,er. The Seller will, within 24 hours
after the telephone contact, provide Idaho Power a written notice in accordance with )OCV that
will contain the beginning hour and duration of the Declared Suspension of Energy Deliveries
and a descripion of the conditions that caus€d the Seller to initiate a Declarpd Suspension of
Energy Deliveries. Idaho Power will review the docum.entation provided by the Seller to
determine Idaho Power's accqrtance of the described forced outage as qualifying for a Doclared
Suspension of Enerry Deliveries as specified in paragraph 12.3.1. Idaho Power's acceptance of
the Seller's forced outage as an acceptable ford 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, disr€pair or lack of adequate preventative maintenance of the Seller's
Facility.
12.4 Scheduled Maintenance - On or before January 3l of each calendar year, Seller shall submit a writteir
proposed maintenance schedule of significant Facility maintenance for that cal€odar year and Idaho
Power and Seller shall mutually agree as to the acceptability of the proposed schedule. The Parties
determination as to the acce,ptability of the Seller's timetable for schedulod maint€nanca will take into
consideration Prudent Electrical Practices, Idaho Power system requirements and the Seller's preferred
schedule. Neither Party shall umeasonably witbhold acceptance ofthe proposed maintenance schedule.
12.5 Maintenance Coordination - The Seller and Idaho Power shall, to the extent practical, coordinate their
respective line and Facility maintenance schodules such that they occur simultaneously.
L2.6 Contact Prior to Curtailment - Idaho Power will make a reasonable attempt to contact the Seller prior to
exercising its rights to intemrpt interconnction or curtail deliveries from the Seller's Facility. Seller
understands that in the case of emergency circumsances, real time operations of the electrical system,
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and/or uoplanned e\rcnts Idaho Power may not be able to provide notice to the Seller prior to
intemrption, curtailment, orreduc,tion of elechical en€rgy deliveries to ldaho Power.
ARTICLE X{tr: INDEMNIFICATION AND INSI,JRA}.ICE
13.1 Indemnificatiom - Each Party shall agr€e to hold harrrless and to indcmnii, the other Party, its ofEcers,
agerrts, affiliates, subsidiaries, parcnt company and e,nrployees against all loss, damage, expense and
liability to third persons for injury to or death of person or injury to prcperty, proximately caused by the
inde,mniffing Party's (a) constnrctiom" ownership, operdion or maintenance of, or by failure of, any of
such Party's works or facilities used in connection with this Agreement or (b) negligent or inte,ntional
acts, enom or omissions. The inde,mni&ing Party shall, on the other Party's requesq defend any zuit
aswrting a claim covered by this inde,mnity. The indemniinng Party shall pay all doctmentd costs,
including reasonable attomey fees that may be incurred by the other Parly in enforcing this indemnity.
13.2 Insumnce - During the term of this Agreemeirt, Seller shall secure and continuously carry the following
insurance coverage:
13.2.1 Comprehensive General Liability Insuraoce for both bodily injury and property damage with
limits equal to $1,000,000, each occutrence, combined single limiL The deductible for such
insurance shall be consistent with current Instrance Industry Utility practices for similar
propsrty.
L3.2.2 The above insurance covcrage shall be placod with an imurance company with an A.M. Best
Company rating of A- or better and shall include:
(a) An endorsernent naming Idaho Power as an additional insured and loss payee as
applicable; and
O) A provision stating that such policy shall not be canceled or the limits of liability
reduced without sixty (60) days' prior written notice to Idaho Power.
13.3 Seller to Provide Certificate of Ingurance - As required in paragraph 4.1.5 herein and annually
thereafter, Seller shall fundsh Idaho Power a certificate of insurance, together with the e,ndorsements
required therein" evidencing the coverage as set forth above.
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13.4
l4.l
Seller to Noti& Idaho Power of Ioss of Coverage - If the insurance coverage required by paragraph
13.2 shall lapse for ary reason, Seller wilt immediately notify Idaho Power in writing. The notice will
advise Idaho Power of the specific nea$)n for the lapse and the steps Seller is talcing to reinstate the
coverage. Failure to provide this notice and to expeditiouly reinstate or replace the coverage will
constitute a Material Breach of this Agreemeirt.
ARTICTE XIV: FORCE MA,IEURE
As used in this Agreement "Forpe Majeure" or "an we,nt of Force Majcure" means aoy caulrc beyond
the contrrol of the Seller or of ldaho Power which, despite the exercise of due diligence, such Party is
unable to prev€ot or overoome. Forpe Majzure includes, but is not limitd to, acts of GoG file, flood,
storms, wars, hostilities, civil shife, skikes and other labor dishrbances, earthquakes, fires, lightning,
epidemics, sabotage, or changes in law or regulation occurring after the effective date, which, by the
exercise ofreasonable foresight such party could not reasonably have been expected to avoid and by the
exercise of due diligence, it shall be unable to ovenoome. If either Party is rende.red wholly or in part
unable to perform its obligations under &is Agreement because of an event of Forcc Majeure, both
Parties shall be excused from whatever performance is affected by the went of Force Majeure, provided
that:
(l) The non-performing Party shall, as so<)n as is reasonably possible after the occur€noe
of the Force Majeure, give the other Party written notice describing the particulars of
the occurrence.
(2) The zusponsion of performance shall be of no great€r scope and of no longer durati<rn
than is required by the event of Force Majeure.
(3) No obligations of either Party which arcse before the occurreirce causing the suspension
of performance and which could and should have been fully performed before such
occurrence shall be excused as a result of such occturence.
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ARTICLE XV: LIABILITY: DEDICATION
l5.l Limitation of Liability. Nothing in this Agreement shall be consEued to create aay duty to, any
standard of care with reference to, or any liability to aoy penlon not a Party to this Agreement. Neither
party shall be liable to the other for any indirect, special, consequential, nor punitive damag€s, excopt as
expressly authorired by this Agree,ment. Consequeutial damages will include, but not be limited to, the
value of re,lrewable ene,qgy certilicate an4 if the Facility is fueled by gas produced by an anae,robic
digester s)Btem, any diminution or loss of anaerobic activity due to the inability of Idaho Power to
accept eircrgy from the Faciltty.
15,2 Dedication No undertakiug by one Party to the other tmder any provision of this Agreemetf shall
constitute the dedication of that Party's syste,m or any portion thereof to the Party or the public or affegt
the status of Idaho Power as an independent public utility corporation or Seller as an independent
individual oreirtity.
16.1
ARTICLE XVT SEVERAL OBLIGATIONS
Except where specifically stated inthis Agreement to be otherwise, the duties, obligations and liabilities
of the Parties are intended to be several and not joint or collec'tive. Nothing contained in this nswment
shall everbe construed to create an association, trust, partnership orjoint veNrturc or irpose a trust or
partnership duty, obligation or liability on or with regard to either Party. Each Party shall be
individually and severally liable for its own obligations under this Ageement.
ARTICLE XVII: WAIYER
l7 .l Any waiver at any time by either Party of its rights with respect to a default under this Agreeme,lrt or
with respect to any other matters arising in connection with this Agreement shall not be deemd a
waiver with respect to any subsequent default or other matter.
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ARTICLE XVIft CHOICE OF LAWS AND VENT.JE
l8.l This Agreement shall be constnred and int€rpr€ted in accordance with the laws ofthe Stat€ of Idaho
without reference to its choice of law provisions.
18.2 Vqrue for any litigation arising out of or rplated to this Agreement will lie in the District Court of the
Fourth Judicial District of Idaho in and for the County of Ada.
ARTICLE XD(: D.ISPUTES AND DEFAIJLT
l9.l Disputes - All disputes related to or arising under this Agrccm€ot, including, but not limited to, the
interpretation of the terms and conditions of this Agreemeut, will be submitted to the Commission for
resolution.
19.2 Notice ofDefault
19.2.1 Defaults. If either Patty faits to perform any of the terms or conditions of this Agreement
(an *event of default'), the mndefaulting Party shall cause notice in writing to be giveo to
the defaulting Party, specifying the manner in which zuch default occurred. If the defaulting
Party shatl fail to cure such default within the sixty (60) days after senrice of such notice, or
if the defaulting 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 to diligently pu$ue such cure, then, the nondefaulting Party may, at its opion,
terminate this Agreement and/orpursue its legal or equitable remedies.
192.2 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 occurrence of the breach.
19.3 Sesuritv for Pgrformance - 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. lf Seller fails to
comply, such failure will be a Material Breach and may only be cured by Seller supplying
evidence that the requird insurance cov€rage has be€n replaced or reinstatd
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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&M) from a
Registered Professional Engne€r licensed in the State of ldaho, which Certification of
Ongoing O & M shall be in the form specified in Appendix C. Seller's failure to sup'ply the
required certilicate will be an event of default. Such a default may only be cured by Seller
providing the roquired certificate; and
19.3.3 Licenses and Permits - During the full term of this Agrwment, Seller shall maintain
compliance with all permits and liceoses described in paragraph 4.1.1 of this Agreemeirt. In
addition, Seller will supply Idaho Power with copies of any new or additional permits or
licenses. At least enery fifth Conhact Year, Seller will update the documentation described
in Paragraph 4.1.1. If at any time Seller fails to maintain compliance with the permits and
licenses d€scribed in paragraph 4.1.1 or to provide the documentation required by this
paragapb such failure will bG an ev€nt of default and may onlv be cured by Seller
submitting to Idatro Power evidence of compliance from the permitting agency.
ARTICLE XX: GO. VERNMENTAL AUTIIORZATION
20.1 This Agreement is subject to the jurisdiction of those governmental agencies having control over either
Party of this Agreement.
2t.t
ARTICI,E XXI: COMMISSION ORDER
This Agreememt shall become finally effective upon the Commission's approval of all terms and
provisions hereof without change or condition and declaration that all palmsrts to be made to Seller
hereunder shall be allowed as prudortly incurred elrp€Nrs€s for raternaking purposes.
ARTICLE XXtr: SUCCESSORS A}ID ASSIGNS
22.1 This Agreemelrt and all of the terms and provisions hereof shall be binding upon and inure to the benefit
of the respective successors and assigns of the Parties hereto, except tbat no assignme,lrt hereof by either
Party shall become effective without the writteir consent of both Parties being first obtained. Such
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cons€rrt shall not bc unreasouably withheld" Notwithstanding the foregoing any party which Idaho
Power may consolidatg or into which it may merge, orto which it may convey or transfer zubstantially
dl of its electric utillty assets, shall automatically, without furths act, and without noed of conseril or
approval by the Seller, succeed to all of Idaho Power's rights, obligations and interests under this
Agroement. This article shall not prerrcnt a financing entity with recorded or wured rights from
exercising all rights and remedies arailable to it under law or contract. Idaho Power shall have the rig[t
to be notified by the financing entity that it is exercising zuch rights or rmedies.
ARTICLE )O(tr: MODIFICATION
23,1 No modification to this AgreemeNil shall be valid unless it is in writing and signed by both Parties and
subsequently approved by the Commission.
ARTICLE )OflV: TAXES
24.1 Each Party shall pay before delinquency all taxes and other gonernme,lrtal charges which" if failed to be
paid when due, could result in a lien upon the Facility or the Interconnection Facilities.
ARTICLE )O(V: NOfiCES
25.1 All written notices under this Agreernent shall be directd as follows and shall be considered
deliverd when faxed, e'mailod and confumed with deposit in the U.S. Mail, first-class,
postage prepaid, as follows:
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To Seller:
Original dooument to:
AgPowerJerome, LI,C
ATTN: Jim Wiest, Maoagcr
10475 E. ParkMeadows Drive
Suit€ 600
lone Tree, Colorado 80124
Telephone: [phone]FAX: 72A-279-2350
E-mail: [e-mail]
Copy of document to:
Cenergy USA Inc.
11500 N. Rodney Parham Road
Suite 9
Little Rock, A*aosas 72212
Telephone: 501-225:3353FAX: [phone]
E-mail : [e-mail]
E-mail ehl [e-mail]
To Idaho Powen
Original document to:
Vice President Power Supply
Idaho PowerCompany
PO Box 70
Boise, Idaho 83707
FmaiL [e-mail]
Coov of document to:
Cogeneration and Small Power Production
Idaho PowerCompany
PO Box 70
Boise, Idaho 83707
E-mail: rallphin@idahopos'€r.com
Either Party may change the contact person and/or address information listed above, by providing written notice
from an authorized person r€pr€senting the Party
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ARTICLE )O(VI: ADDITIONAL TERMS A}.ID CONDIfiONS
26.1 This Agreement includes the following appcndices, which are attached hereto and included by
refereirce:
AppendixA
Appendix B
App€ndix C
AppendixD
Generation Schoduling and Reporting
Facility and Point of Delivery
Fn ginerr's Certifi cations
Forms of Liquid Secruity
ARTICLE XXVII SEVERABILITY
27.1 The invalidity or unenforceability of any term or provision of this egee, ent shall 161 affect the
validity or enforceability of any other terms or provisioas and this Agrement sball be constnred in all
other respects as if the invalid or uucnforceable term or provision wene omitted.
ARTICLE }OfiIItr: COTINTERPARTS
28.1 This Agreement may be executed in two or mor€ count€rparts, each of which shalt be deemed an
original but all of which togeth€r shall constitute one and the same instnrment.
ARTICLE XXD(: ENTIRE AGREEMENT
29.1 fhis agreement constitutm the entire Agreemeirt of the Parties concerning the subjwt matter hereof and
supersedes all prior or contempomneous oral or written agreements beween the Partiee concenring the
subject matterhereof.
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IN WTINESS WHEREOF, The Parties hereto have caused this Agreement to be errccut€d in
their respective rames on the dates set forth below:
Idaho PowerCompany AgPowerJermrc, LLC
By By
Lisa A Grow
Sr. Vice President, Porver Supply
JimWicst
Manager
Dated Dated
'Idaho Powef "Seller"
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APPEI{DD( A
A -I MONTIILY POWER PRODUCION AI{D SWTTCHING REPORT
At the eird of cach montl the following requirod documeotation will be zubmitted to:
Idaho Power Company
Attn: Cogeneration and Small Power Pnoduction
P0 Box 70
Boise,Idaho 83707
The meter readingp required on this report will be tk readings on thc Idaho Power Meter Equipment measuring
the Facility's total elrerry production and Station Usage deliverod to Idaho Power and the maximum generated
cnergy GSD as reconded on the Metering Equipmeot and/or any other required energy meastrc, eirts to
adequately administer this Agree,ment. This document shall be the document to eirable Idaho Power to begin the
energy palmqrt calculation and paynent prccess. The meter readings on this r€port shall not be usd to
calculate the actual palmmt, but instead will be a chock of the automated meter rcading information that will be
gathered as described in item A-2 below:
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ProJcct Name
Address
City
Idrho Power Company
Cogenerefion rnd Smell Power Prcduction
MONTHI,Y FOWER PRODUCTION ADID SWTTCHING REPIORT
Month Year
Profcct Number:
Phone Number:
State ?ip
Factltty
Outout
Shdon
Ustqc
Stadon
Usace
Metered
MrdmumGeoendon
kw
Net Generetion
MeterNumber:
End of Month kWh Meter Reeding:
negmmg of Month kWh Meter:
Dlfference:
Timer Meter Constent:
kWh for the Month:
Metered Demand:
BrerkerQrcnlng Record
Date
* Breeker Ooenlng Reeson Codes
I Leck of Adequate Prime Mover2 l'orrced Outage of f,'ecility
3 Dlcturbrnce of IPCo Syrtem
4 Schcduled Malntenence
5 TesdngofProtecdonSystems6 Cauee Unknown
7 Other (Erplein)
*Reeson
Breeker Cloclng Record
Date TIme Meter
I hereby cefttry thet the rbove meter readings are
true and correct ar of Midnight on the last day of the
ebove month and that the rwttchlng reeord is eccurate
and complete as requlred by the Flrm Enerry Saler
Agreement to whlch I em e Pert5r.
Tlme Metcr
Signature
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A.2 AUTOMATED METER. READING COLLECTION PROCESS
Monthly, Idaho Power will usc the providod Metering and Telemetry equipmeirt and proccsses to colloct the
meterreading informatioa from the Idaho Powerprovided Metering Equipmeirt tlat measures the Net Energy
and energy delivered to supply Station Use for the Facility recordd al 12:00 AIU (Midnigh$ of the last day of
themonth..
The meter information collected will include but not be limit€d to energy production, Statiol Use, the maximum
generated power (k\lr) and any other required €Nrergy m€asurem€Nfs to adequately administerthis Ag[eem€ot.
A.3 ROUTINEREPORTING
Once the Facility has achieved its Operation Dar aadhas oe€rated in a reliable and consistent rnamer
for a reasonable period of time, the Parties may mutualll, agree to modiff this Routine Reporting
requireme,nt.
Idaho Powcr Contact Information
Daily Energy Production Reporting
Call daily by l0 a.m., l-800-3564328 or 1{00{35-1093 and leave the following information:
o Project ldentification - Project Name and Project Number
o CurrentMeterReading
o Estimated Generation forthe curr€nt dayo Estimatod Generation for the next day
Planned and Unplanned Prrojec! outages
Call l-800-345-1319 and leave the following information:
o Project ldeirtification - Project Name and Project Numberr Appnrximate time outage occurred
o Estimated day and time of project coming back online
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Seller's Contac.t Informatim
24-Hour Pnoject Operational Contact
Name:
Tclcphone Number:
Cell Phone:
BradWeg
208-3204636
208-3204636
Projoct On-site Conact information
Name:Same as above
TelephoneNumber:
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APPEI{DX B
FACILMY A}.ID POINT OF DELWERY
Project Name: Double A Digester Project
Projest Numben
B-I DESCRIPTION OF TACILMY
(Mtut trclude the Namephte CaWcW ruing and yAR crybiw (both leadhg and lagging) of all genemtion
units to be bchded in he Facility.)
Three (3) Caterpillar Model 868 Generator with Name,plate Capacig of 1.6 MW each but operating
At 1.5 MW each due to opemating capacity of the prime mover at site elevation.
Yar Capability (Both leading and laging) I"eading is _N/A_ Iaggmg is .B pF
B-2 LOCATION OF FACILTTY
Near: Jeromg Idaho
Sections: 32 Township: 6 South Range: 17 East County: Lincoln,ID.
Description of Interconnection Location: East side of digester mechanical building
Nearest Idaho Power Substation: Notch Butte
B-3 SCHEDLTLED FIRST ENERGY AI.ID OPERATION DATE
Seller has selected June l. 201 I as the Scheduled First EnergSr Date.
Seller has selected January l. 2012 as the Scheduled Operation Date. In malc'ng these selections, Seller
recognizes that adequate testing of the Facillty and completion of all roquirements in paragraph 5.2 of
this fureernelrt must be complded prior to the project being granted aa Operation Date.
84 MA)(IMT.JM CAPACTTY AMOUNT:
This value will be 4.5 MW which is consistent with the value provided by the Seller to Idaho Power in
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accordance with Schedule 72. This value is the maximum eaergy (MW) that potentially could be
delivered by the Seller's Facility to the ldaho Power electrical system at any momEnt in time.
B-5 POINT OF DELTVERY
'?oint of Deliver:f means, unless otherwise agleed by both Parties, the point of wherE the Sellers
Facility's elrcrgy is delivered to the Idatro Power elctical system. Schedule Tzv,iildAcrmine the
specific Point of Delivery for this Facility. The Point of Delivery identified by Schedule T2wtll beoome
an integral part of this Agreement.
86 LOSSES
If the Idaho Power Metering equipment is capable of measuring the exact eflergy deliveries by the Seller
to the ldaho Power electrical systern at the Point of Delivery, no L"osses will be calculated for this
Facility. If the Idaho Power Metering is unable to measure the exact eneryy deliveries by the Seller to
the Idaho Power elecfical system at the Point of flelivery, a Losses calculation will be established to
measure the energy losses ftWh) betrveeir the Seller's Facility and the Idaho Power Point of Delivery.
This loss calculation will be initially ggt atTo/o of the kWh en€rgy production recorded on the Facility
generation metering At such time as Seller prcvides Idaho Power with the electrical
equipment specifications (transformer loss specifications, conductor sizes, etc) of all of the electrical
betwcn the Facility and the Idaho Power electrical system, Idaho Power will configure a
revised loss calculation formula to be agreed to by both parties and used to calculate the kWh [osses for
the remaining tenn of the Agreem€Nrt. If at any time during the term of this Agrmenf Idaho Power
determines that the loss calculation does not concctly reflect the actual kWh losses atEibuted to thc
electrical equipment betrrem the Facility and the Idaho Power electrical syste'u, Idaho Power may
adjust the calculation and retroactively adjust the previous months kWh loss calculations.
B-7 METERING AND TELEMETRY
Schedule 72 will determine the specific metering and teleinetry requirements for this Facility. At the
minimum the Metering Equipment and Telemetry equipment must be able to provide and record hourly
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en€rgy deliveries to the Point of Delivery and aoy other cnergy measurements required to administer
this Agreeme,lrt. These specifications will include but not be limitd to equip,ment specifications,
equipment location, Idaho Power provided equipment, Seller provided equipm€,ot and all costs
associated with the equipment, desig and insAllation of the ldaho Power provided equipment. Seller
will arrange for and make available at Selle/s cost communication circuit(s) compatible with Idaho
Power's communications and dedicated to Idaho Poweds use terminating at the Idaho Power
facilities capable of providing ldaho Power with continuous instantaoeous information on the Facilities
ene(gy production. Idaho Power provided equipment will be owned and maintained by Idaho Power,
with total cost of purchase, installation, operation, and maintenance, including adminishative cost to be
reimbursed to Idaho Power by the Seller. Payrre,nt of these costs will be in accordance with Schedule
72 and tbe total metering cost will be included in the calculation of the Monthly Operation aod
Maintenance Clrarges specified in Schedule 72.
B.8 NETWORK RESO{JRCE DESIGNATION
Idaho Power cannot accept or pay for ge'neration frrom this Facility until a Netwotk Resource
Designation ('NRD') application bas be€n acrepted by Idaho Power's delivery business unit. fed€Tal
Energy Regulatory Comrnission ('FERC') Rules require Idaho Power to prcpare and submit the NRD.
Because much of the information Idaho Power needs to pr€pare the NRD is specific to the Seller's
Facility, Idaho Power's ability to file the NRD in a timely mann6 is continge,nt upon timely receipt of
the required information from the Seller. Prior to ldaho Power beginniag the process to eirable Idaho
Power to submit a request for NRD status for this Facility, the Seller shall have completed all
requiremnents as specified in Paragraph 5.7 of this Agreement. Seller's failure to provide complete
and accurate information in a tlmely mrnner cen cignificantty lmpact Idrho Power's ability end
cost to ettain the ltRD designation for the Seller'g Faciltty and the Seller thall bor the costt of
any ofthese delays that ere e recult ofany action or lnrc{ion by the Seller.
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APPENDD(C
ENGINEER'S CERTIFICATION
OF
OPERATIONS & MAINTENA}.ICE POLICY
The undersigned . on be,half of himself and
hereinafter collectirrcly referred to as "Engineer," heneby states and certifies to the Seller as follows:
1. Ttrat Engineer is a Licensed Professional Engineer in good standing in the Stat€ of Idaho.
2. That Engineer has reviewed the Energ5r Sales Agreement, hereinafter "Agroem€nt," between Idaho
Power as Buyer, and as Seller, dated _.
3. Tha thc cogeneration or small pow€r production p,roject which is the subject of the Ageemelrt and tbis
Statement is identified as IPCo Facility No. and is hcrEinafter refened to as the '!Project."
4. That the Project, which is commonly known as the is located in
section
-
Township
-
Rmge
-,
Boise Meridiaq _ county, Idaho.
5. That Engineer recognizes that the Agreeureirt provides for the Project to fumish elwtrical energ5r to
Idaho Power for a _ year peri.od.
6. That Engineer has substantial experience in the design, constnrction and operation of electric power
plants of the same tpe as this Project.
7. That Engineer has no economic relationship to the Design Fngineer of this Prroject.
8. That Engineer has reviewd and/or zupenrised the review of the Policy for Operation and Maintenance
("O&M') for this Project and it is his professional opinion that, providod said Project has been designed and
built to appropriate standards, adherence to said O&M Policy will result in the Pmject's poduci4g at or near the
design eletrical output, efficiency and plant factor for a lifteen (15) year period.
9. That Engineer recomizes that Idaho Power, in accordance with paragraph 5.2 of the fureemenl is
relyrng on Engineer's representations and opinions contaiuod in this Statcmsnt.
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10. That Enginccr certilies that the abow state,meirts are complete, tnre and accurate to the best of his
knowledge and thereforc sets his hand and seal below.
By
(P-8. Stamp)
Date
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APPEI{DD(C
ENGINEER' S CERTIFICATION
OF
ONGOING OPERATIONS A}ID MAINTENANCE
The undersigned on behalf of himself and
hereinafter collectively referred to as "Engine€r," hereby states and certifies to
the Seller as follows:
1. That Engineer is a Licensed Professional Engineer in good staading in thc State of Idaho.
2. That Engineer has reviewed the Energy Sales Ageement, hereinafter "Agree,men!' between ldaho
Power as Buyer, aod _ as Seller, dated
3. That the cogeneration or mall power prduction project which is the subject of the Agreemeirt and this
Statement is ideirtified as IPCo Facility No.and hereina$er referred to as the *Project"
4. Thaf the Pooject" which is commonly known as the Project, is located in
Section _ Township _ Range . Boise Meridiao" County, Idaho.
5. That Engineer recoEnizes that the Agreement provides for the Project to furrish clectrical energy to
Idaho Power for a fifteen (15) year period.
6. That Engineer has substantial experience in the design, consfiuction and operation of electric power
plants of the same tlpe as this Prcject
7 . That Engineer has no ecmomic relationship to the Design Engineer of this hoject.
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8. That Eaginoer has made a phpical inspectioa of said Project, its operations and maintenance records
since the last previous c€rtified inspection. It is Engineer's professional opinion, basd on the hoject's
appcaraoce, that its ongoing O&M has been substantially in accordance with said O&M Policy; that it is in
good operating condition; and that if adhereirce to said O&M Policy contiaueso the Prroject will
continue goducing at or near its design electical output, efficiency and plant factor for the re,maining
years of the Agee,m€nt.
9. That Fnginoer recognizes that Idaho Power, in acccdance with paragraph 5.2 of thc Agreement, is
relytng on Engineer's representations and opinions contained in this Statemexrt.
10. That Engineer certifies that the above statom€Nfs are complete, tnre and acoruate to the best of his
knowledge and therefore sets his hand and seal below.
By
(P.E. Stamp)
Date
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APPENDX C
ENGINEER'S CERTIFICATION
OF
DESTGN & CONSTRUCTTON ADEQUACY
The undersigned on behalf of himself and
hercinaftEr collectively reforred to as "Engineed', hereby states and certifies to
Idaho Power as follows:
l. That Engineer is a Licemsed Professional Engineer in good standing in the State ofldaho.
2. That Enginoer has reviewed the Firm Energy Sales Agreement, hereinafter "Agle€meot",
betneen ldaho Power as Buyer, and Scller, dated
3. That the cogeneration or small pow€r production project, which is the subject of the Agreemeirt
and this Statement, is identified as IPCo Facility No _ and is hereinafter referrod to as the
"Projctn.
4. That the Project, which is commonly knowu as the is located in
Section _ Township _ Raoge Boise Meridian,County,Idaho.
5. That Engineer recognizes that the Agreement prcvides for the koject to furnish electrical
ercrgy to Idaho Power for a fifteen (15) year period.
6. That Engineer has substantial experience in the design, constnrction and operation of eloctric
power plants of the same tlpe as this Prcject.
7. That Engineer has no economic relationship to the Desip Engineer of this Project and has
made the analysis of the plans and specifications independently.
8. That Engineer has reviewed the engineering design and construction of the Project, including
the civil worls, electrical work, generating equipment, prime mover conveyarce system, Seller fumished
Intcrconnection Facilities and other Ploject facilities and equipment.
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9. That the Prroject has be€n constnrcted in acoordance with said plans and specificdions, all
applicable codes and consistent with Prudent Electrical Practices as thd term is dacribed inthe Agrccment.
10. That the desig and construction of the hject is such that with reasonable and pnrdent
operation and maintenance practices by Seller, the hoject is capable ofperforming in accordance with the terms
of the Agreement and with Prudent Elechical haotices for a _ year period.
t l. That Enginaer recognizes that Idaho Power, in accordance with paragraph 5.2 of the Agloement,
in intenconnecting the Project with its syst€m, is relying sa F.ngineeds r€prcseifations and opinionrs contained in
this Statemeirt.
L2. That Engineer certifies that the above statements are complete, tue 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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a
APPENDD( D
FORMS Or LTQUID SECLJRTTY
The Seller shall provide Idaho Power withcommercialtyreasonable security instnrmeirts such as Cash
Escrow Security, Guarantee or Irtter of Credit as thoso terms are defined below or other forms of ligid
financial security that would provide readily available cash to Idaho Powerto satisff the Delay Security
require,ment within this egwoent.
For the purpose of this Appendix D, the term *Crcdit Requircments" shall mean acceptable financial
creditworthiness of the entity prcviding the security instrument in relation to the term of the obligation
in the reasonable judgment of ldaho Power, provided that any guarante aod/or lett€r of sredit issted by
any other elrtity with a shortterm or long-term investment gnde cr€dit rating by Standard & Poor's
Corporation or Moody's Investor Services, Inc. shall be deemed to have acceptable financial
creditworthiness.
l. Cash Escrow Security - Seller shall deposit firrds in an escrow account estabtished by the Seller in
a banking institution acceptable to both Parties equal to the Delay Security.
2. Guarantee or Letter of Credit Security - Seller shall post and maintain in an amount equal
to the Delay Security: (a) a guaranty from a party that satisfies the Credit Requireme,lrts, in
a fonn acceptable to Idaho Power at its discretion, or (b) a Letter of Credit in a fomr
acceptable to Idaho Power, in favor of Idaho Power. The trtter of Credit will be issued by
a financial institution acceptable to both parties.
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Office of the Secretary
Service Date
Desember 16,2010
BEFORE THE IDAHO PTJBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION
OT'IDAHO POWER COMPAI\TY FOR
APPROVAL OF A FIRM ENERGY SALES
AGREEMENT WITH AGPOWER
JEROME, LLC, FOR THE SALE AND
PURCHASE OF ELECTRIC ENERGY.
CASE NO.IPC-E-I0.26
oRDER NO. 32138
On October 20, 2010, Idaho Power Company filed an Application with the
Commission requesting approval of a}D-year Firm Energy Sales Agreement (the "Agreement')
between Idaho Power and AgPower Jerome, LLC, (AgPower) dated October 13, 20L0. The
Application states that AgPower would sell and Idaho Power would purchase electic energy
generated by the Double A Digester Project (the "Facility') located in Lincoln Corurty, Idaho.
The Company requested that its Application be processed by Modified Procedure.
. On November 16,2OlO, the Commission issued a Notice of ApplicationA.iotice of
Modified Procedure setting a December 8, 2010, comment deadline. Staffwas the only party to
file comments. By this Order, the Cornmission approves the Agree,ment betweeir Idaho Power
and AgPower without change or condition and declares that all payments made by Idaho Power
to AgPower for purchases of energy shall be allowed as pnrdently incurred expeirses for
ratemaking puposes.
THE AGREEMENT
The Agreement is for a tenn of 20 years and contains the non-levelizd, published
avoided cost rates established by the Commission in Order No. 30744 for e,nergy deliveries of
less than l0 average megawatts C'aMW). The maximum capacity of the Facility is expected to
be 4.5 MW. Idaho Power warrants that the Agreement comports with the terms and conditions
of the various Commission Orders applicable to PURPA agreements (Order Nos. 30415, 3M88,
30738, and 307 M). Applicati on at 2.
Although the Agreement is dated October 13, 2010, Idatro Power submits that
AgPower should be entitled to the avoided cost rates set out in Order No. 30744 (rates
superseded on March 16, 2010, by Order No. 31025). Idaho Power asserts that, but for a
disagreement as to the damage and security provisions, the Agreement would have been signed
by both parties prior to March 16,2010. The Agreement, as submitted, contains the most rece,nt
oRDER NO. 32138
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terms and conditions, including liquidated damages and security provisions. As such, Idaho
Power maintains that this Agreement is similarly situated to other power purchase agreements
approved by this Commission that eontain grandfathered avoided cost rates.
ldaho Power asserts that AgPower is current in all of its interconnection study
payments. AgPower selected a Scheduled Operation Date of January 1,2012, for its Facility.
By its own terms, the Agreement will not become effective until the Commission has approved
all of the Agreement's terms and conditions and declares that all payments made by ldaho Power
to AgPower for purchases of energy will be allowed as prudently incuned expenses for
ratemaking purposes. Agreement fl 21.1.
TIIE COMMENTS
Staffidentified AgPower's entitlement to grandfathered rates as the only issue of real
significance in this case, Staff noted that on April 9, 2010, AgPower filed a complaint against
Idaho Power with the Commission alleging that AgPower was entitled to a contract containing
the higher avoided cost rates of Order No. 30744. Idaho Power filed an answer on May 5, 2010,
alleging that AgPower was not entitled to Order No. 30744 avoided cost rates because AgPower
was disputing damage and security provisions that are part of Idaho Power's "standard" terms
and conditions for PURPA agreements. Application at 6.
Subsequent to AgPower's complaint, the parties entered into negotiations to attempt
to resolve their dispute over damage and security provisions. As evidenced by the submitted
Agreement, the parties have resolved their dispute. The Agreement contains the most recent
terms and conditions, including liquidated damages and security provisions. In effect, the
Agreement contains all of the terms, conditions and rates that Idaho Power maintained were
appropriate in the beginning, before the dispute a.rose.
Idaho Power maintains that this Agreement is similarly situated to other power
purchase agreements approved by this Commission that contain grandfathered avoided cost rates.
Staffagrees. Consequently, Staffrecommended the Commission approve all of the Agreement's
terms and conditions and declare that all payments made by Idaho Power to AgPower for
purchases of energy will be allowed as prudently incurred expenses for ratemaking purposes.
FINDINGS AND CONCLUSIONS
The Idaho Public Utilities Commission has jurisdiction over Idaho Powet, an electric
utility, and the issues raised in this matter pursuant to the authority and power granted it under
ORDERNO. 32138 2
Title 6l of the [datro Code and the Public Utility Regulatory Policies Act of 1978 (PURPA). 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 facilities (QFs) and to
implement FERC rules.
The Commission has reviewed the record in this case, including the Application, the
October 13, 2010 Agreement, and the comments and recommendations of Commission Staff.
The Agreement contains the nonlevelized published avoided cost rates established by the
Commission in Order No. 30744. Because the Agreement is dated Ostober 13, 2010, Order No.
31025 (effective March 16,2010) would require that the rates paid to AgPower under its
Agreement be the rates set out in Order No. 31025 rather than the previously higher rates
approved by the Commission in Order No. 30744. However, Idaho Power asserts that, but for
the disagreement as to liquidated damages and security provisions, the Agreement would have
been signed by both parties prior to March 16,2010.
We find that Idatro Power has fairly represented our past grandfathering criteria
requirements and their application to the particular facts of previously decided cases. We firrther
find Idaho Power's approach in this case regarding published rates to be in concert with the spirit
of those prior grandfathering cases. See A.W. Brownv, Idaho Power,l2l Idaho 812, 828 P.zd
S4l (1992); Order No. 29872. Consequently, based on the record established in this case, we
find that AgPower is entitled to the grandfathered rates of Order No 307214. We further find it
reasonable to allow payments made under the Agreement as prudently incurred expenses for
ratemaking purposes.
ORDER
In consideration of the foregoing and as more particularly described above, IT IS
HEREBY ORDERED that the October 13, 2010, Firm Energy Sales Agreement between Idaho
Power and AgPower is approved without change or condition.
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within tw€nty-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. 32138 3
DONE by Order of ths Idaho Public Utilities Commission at Boise,Idatro this /lf
day of December 2010.
,
KEMPTON
Sl*4^ l&^e
MARSHA H. SMITH, COMMISSIONER
\-s51,
MACK A. REDFORD, COMMTSSIONER
ATTEST:
D.J
Secretary
O:IPC-&lG26Js2
4ORDERNO. 32138