19890130Application.pdf

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WORLD TRAE CENTR BUILDING
SUITE 3704
P.O. 572-4-1 IlTSU-CHO
MINAro-Ku
TOKYO 105 JAPAN
(0(3 432-8998
LINDSAY, HART, NEIL & WEIGLERLAWYERS HECEI D rv~SUITE 1800
222 S. W. COLUMBIA STREET
PORTLAD,OREGON 97201-8818
(50(3 228-1191
ROY L. EIGUREN
SUITE 400
JEFFERSON PLACE
350 N.9TH
BOISE. IDAHO ;~... 7(l130.v" v1111
TELEPHONE [phone]B44
TELECOPIER (20B) 338-Baqq
January ti0.(; If1~'lp" n H C. ".. i iCS íJvfilf.1lS
¡LED o
Plì ~ 18 2011 EYE STREET, N. W.
WASHINGTON, D.C. 20036
[phone]
N
VIA HAND DELIVERY
Myrna J. Walters,
Commission Secretary
Idaho Public utilities Commission
472 West Washington Street
Boise, Idaho 83702
Re: Application for Approval of Power Sales
Agreement - Hazelton "A"
Dear Ms. Walters:
Enclosed you will find an original and seven copies of Bypass
Limited, a California Limited Partnership's Application for
Approval of a Firm Energy Sales Agreement with Idaho Power
Company. Also enclosed, for your reference is a copy of the
Certificate of Registration on file with the Idaho Secretary of
State's Office indicating the legal status of Bypass Limited, a
California Limited partnership.
Also filed herewith is a Notice of Withdrawal filed by both
Idaho Power Company and sithe Energies, USA. The Notice of
wi thdrawal is made contingent upon the granting by the Commission
of the Application for Approval of the Firm Energy Sales
Agreement.
Would you please be so kind as to file the above referencedpleadings?
~. eiry~s.,l.L.1~
ROY L. iguren
Irs
Enclosures
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CERTIFICATE OF REGISTRATION, OF
BYPASS LIMITED. A CALIFORNIA LIfUTED PARTNERSHIP
I, PETE T. CENARRUSA, Secretary of State of the State of Idaho, hereby certify that
duplicate originals of an Application of BYPASS LIMITED. A CALIFORNIA LIMITED
PARTNERSHIP for Registration in this State, duly signed and verified
pursuant to the provisions of the Idaho Limited Partnership Act, have been received in this
offce and are found to conform to law.
ACCORDINGL Y and by virtue of the authority vested in me by law, I issue this Certificate
of Registration to BYPASS LIrUTED, A CALIFORHIA LUUTED PARTriERSHIP
to transact business in this State under the name BYPASS LIMITED, A CALIFORNIA
LIMITED PARTNERSHIP and attach hereto a duplicate original of the Application
for Registration.
Dated January 27, 1986
CBr-
SECRETARY OF STATE
by:
Limited Partnership
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CRLP 182
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APPLICATION FQR REGISTRATION OF
FOREIGN LIMITED PARTNERSHIP
,.. ..' :._'1', l ~ 7'. _'To the Secretary of State of the State of Idaho:, . ~,~ "1-' : ,. ': ',:t: E. "I. .. -. - '. -J ;.' _ ~ .Pursuant to the provisions of Chapter 2, Title 53, Idaho Code, tlt'oñäérsigned Limited,fartnership
hereby. applies for registration to transact business in your Sta.~~, jJl~ for i that puryo;J ~9nlits thefollowing stat~ment: 0\) iin 4-
Bypass Limited, a Californiai. The name of the limited partnership is
limited partnership
2. The name which it shall use in Idaho is
limi ted partnership
(Must include. without abbreviation. the words "Limited Partnership.")
Bypass Limited, a California
3. It is organized under the laws of'California
4. The date of its formation is November 22 l 1985
5. The address of its re,gistered or principal Qffce in the state j)r çountr)¡ .\uder ~e lawÀ of w'tch it iSCA
organized is l80l Avenue or tne Stars, ::uite H.L~, os nge es,90'067
David H. Leroy6. The name and street address of its proposed registered agent in Idaho are
205 N. lOth Street, Boise, Idaho 8370l
7. The gene~~1 c~~~a:~er _of th~ b~s~ness it prop~~es ,t,o ,~ransact in Id~?o i~: _
Develop, construct and operate a hydroelectric generation
facility.
8. The name and business address of each general partner and of each limited partner whose contribu-
tion is equal to or greater than five percent (5%) of the total contribution of all partners:
Name General or Limited Address
l80l Avenue of the Stars,Bypass Power Company General
Suite 815
Los Angeles, California 90067
(continued on reverse)
ARLP785 File 2 Copies Fee: $60.00
8. (Continued)fI
Name General or Limited Address
"
9. This Application is accompanied by a certificate certifying to the lawful existence of the limited
partnership, executed by the proper offcer of the state or country under the laws of which it is
organized.
Dated January l4,86,19_.
Bypass
William residentBy
STATE OF CALIFORNIA
COUNTY OF LOS ANGELES
)
) ss:
)
I,Cecilia D. Kelly , a notary public, do hereby certify that on this
l4th day of January
William Kriegel
, 19 86 ,personally appeared
before me , who being by me first duly sworn,
declared that (s)he is ~~)(~l!~ President of Bypass Power Company,
general partner of Bvpass Limited, a Californialimited partnership.
that (s)he signed the foregoing document as a general partner of the limited partnership and that the state-
ments therein contained are true.
ø OFFICIAL SEAL
. CECILIA D. KELLY
. . . tlo'''' "U8I,IC CApUlltllA. ".INCI""i o,nci ttl
.' LOS ANGELES COUNTY
MyCommission ExpireFeb. 2. 198
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SACRAMENTO
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CERTIFICATE OF STATUS
CALIFORNIA LIMITED PARTNERSHIP
I, MARCH FONG EU, Secretary of State of the State of California, hereby certify:
That on the 22nd day of Novembr ,19..,
BYPASS LIMITE, A CAIFORNIA LIMITED PARTNHIP
became recognized under the laws of the State of California by filing its Certificate of
Limited Partnership in this office; and
That no record exists in this office of a certificate of cancellation of said limited part-
nership nor of a court order declaring cancellation thereof; and
That according to the records of this office, the said limited partnership is authorized to
exercise all its powers, rights and privieges and is in good legal standing in the State of
California; and
That no information is available in this office on the financial condition, business ac-
tivity or practices of this limited partnership.
IN WITNESS WHEREOF, I execute
this certificate and affx the Great
Seal of the State of California this
26th day of Deemr, 1985
~~.~.
Secretary of State
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Roy L. Eiguren
Peter J. Richardson
LINDSAY, HART, NEIL & WEIGLER
350 North Ninth Street
Jefferson Place, suite 400
Boise, Idaho 83702
208/336-8844
¡~ECEI rn
LED 0
JAN 30 pr~ ~ 50
Attorneys for Sithe Energies U.S.A.
and Bypass Limited Partnership
PUBLIC
LInES COMMISSIONx:.~
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )
OF BYPASS LIMITED PARTNERSHIP )
FOR AN ORDER APPROVING A FIRM )
ENERGY SALES AGREEMENT WITH IDAHO )POWER COMPAN )
)
CAE NO. IPC-E-89-2
APPLICATION FOR APPROVAL
COMES NOW Bypass Limited, a California Limited
Partnership that is qualified to do business in the State of Idaho
(Applicant) and requests the Idaho Public utilities Commission
(Commission) for an Order approving a Firm Energy Sales Agreement
(Agreement) with Idaho Power Company (Idaho Power) for the
proposed Hazelton "All Hydroelectric Facility (Facility). A copy
of the Agreement is attached hereto. This Application is based on
the following:
I.
Idaho Power is a regulated public utility subject to the
jurisdiction of the Commission.
APPLICATION FOR APPROVAL - i
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II.
The Facility will be a qualifying small power production
facility under the Public utility Regulatory Policy Act of 1978
("PURPA") .
III.
On January l8, 1989, the Applicant and Idaho Power
entered into a Firm Energy Sales Agreement, a copy of which is
attached hereto and by this reference made a part hereof, Exhibit
A.
iv.
The Agreement has a term of twenty (20) years. The
Facility is located in the NE Quarter of section 2, Township 10
South, Range 20 East, Boise Meridian, Jerome County, Idaho and
will have a total capacity of approximately 9,900 kw.
v.
Applicant represents to the Commission that it is a
qualifying small power production facility, that the avoided cost
rates contained in the Agreement are in compliance with Commission
Orders, and that the acquisition of energy by Idaho Power from
Applicant, pursuant to the Agreement, will be in the public
interest.
vi.
In order to provide Idaho Power with assurance that the
costs it has contracted to pay under the Agreement will be allowed
as prudently incurred expenses for ratemaking purposes, Applicant
APPLICATION FOR APPROVAL - 2
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respectfully requests the Commission to include in its Order
approving this Agreement, language essentially as follows:
All payments to be made under the Agreement between
Applicant and Idaho Power shall be allowed as prudently
incurred expenses for ratemaking purposes by Idaho Power
Company.
VI.
Recognizing the Agreement is one of the first fully
negotiated firm energy sales agreements entered into by Idaho
Power Company since the Commission issued its 'security' orders
(Order Nos. 21690 and 21800) the Applicant specifically notes for
Commission review, the following clause from the Agreement:
(c) In lieu security:
Because the Facility is located on the canal
system of the Northside Canal Company and therefore
receives the benefits of the Northside Canal Company's
senior water rights and upstream storage, Idaho Power is
willing to permit Seller to establish a Debt Service
Reserve Account until conforming low water insurance
becomes available. Said Debt Service Reserve Account
will be separate from the maintenance escrow account and
shall be structured as follows:
( l) The escrow instructions between the
Seller and the Escrow Manager will provide that the
funds in the Debt Service Reserve Account will be
prudently invested and that all costs of setting up
and operating the Debt Service Reserve Account,
shall be paid by the Seller. At the end of the
term of this Agreement, or at the end of Seller's
obligation to maintain an escrow account in lien
(sic) of purchasing low water insurance, any
balance remaining in the Debt Service Reserve
Account shall be released to Seller.
(2) wi thin 60 days after commencement of
a Contract Year in which Seller is entitled to
provide security in-lieu of conforming low water
insurance coverage, Seller will deposit cash in the
Debt Service Reserve Account in an amount equal to
2l% of the Facility's estimated gross income for
APPLICATION FOR APPROVAL - 3
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that Contract Year. Said requirement to deposit2 l % of estimated gross income for each Contract
Year shall cease when the Debt Service Reserve
Account is funded in an amount equal to three
months' debt service on the project, or $250,000,
whichever is higher. All interest earned on the
funds on deposit shall be retained in the DebtService Reserve Account. The requirement that
interest earned on funds on deposit in the Debt
Service Reserve Account be retained in that account
shall cease once the Debt Service Reserve Account
is fully funded as provided above.
(3) The Escrow Manager will be
instructed to only release funds from the Debt
Service Reserve Account to the holder of the debt
on the Facility. Funds from said account shall be
released only when, and only to the extent that
Seller certifies to the Escrow Manager that the
Facility's revenues are insufficient to satisfy
Seller's costs of operating the Facility and as a
result, remaining funds are not sufficient to make
debt service payments on the Facility. for
purposes of the Debt Service Reserve Account, costs
for operating the Facility shall be limited to
those costs necessary for the operation of the
Facility .such as taxes, insurance expenses, and
other ordinary and necessary operating expenses.
Costs for operating the Facility shall not include
any disbursements which would constitute a profit
or return on investment.
(4) When conforming low water insurance
has been purchased, Seller will no longer be
required to fund or maintain said Debt Service
Reserve Account.
(d) Failure to provide conforming low water
insurance or to maintain the Debt Service Reserve
Account described above, will be a default which can be
cured by reinstatement of the insurance or the Debt
Service Reserve Account, or by posting liquid securityin accordance with Paragraph 2 1 . 4 in an amount equal to
100% of the accumulated overpayment amount specified for
that year in Appendix D.
It is understood and agreed by the parties that the
above clause of the Agreement will be in effect only as
long a conforming low water insurance is not available.
Low water insurance is defined as not being availablewhen its costs exceed 2.5% of the Facil i ty' s proj ectedannual average income. See Paragraph 2 l. 3 . 2 . l.
APPLICATION FOR APPROVAL - 4
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VII.
As per the Settlement Agreement and Stipulation filed
with this Commission in Case No. U-1S00-170 and in Case
Nos. U-1006-300, -301, -302, the Firm Energy Sales Agreement is
explicitly made contingent not only upon its approval by the
Commission but also upon the withdrawal of the Petition for
Rehearing filed by sithe Energies, USA, and the Cross-Petition for
Rehearing filed by Idaho Power Company in Case No. U-1S00-l70.
si the's Petition for Rehearing and Idaho Power's Cross-Petition
for rehearing were granted by the Commission on January 27, 1988,
in Order No. 21734. As a result of entering into the Settlement
Agreement and Stipulation the parties waived their right to have
their respective petitions for reconsideration heard within the
statutory deadline of thirteen (l3) weeks pursuant to Idaho Code
Section 61-626 (2). A copy of that Settlement Agreement and
Stipulation is attached hereto and by this reference made a part
hereof (Exhibit B). A copy of the Joint Notice of withdrawal is
attached hereto and by this reference made a part hereof (Exhibit
C) .
WHEREFORE, Applicant requests that the Commission issue
its Order:
1. Approving the Agreement;
2. Finding that Applicant is a qualifying small power
production facility; that the avoided cost rates contained in the
APPLICATION FOR APPROVAL - S
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Agreement are just and reasonable; and that the acquisition of the
power and energy by Idaho from Applicant is in the public
interest; and
3. Ordering that those costs for purchase of power under
this Agreement shall be allowed to Idaho as prudently incurred
expenses for ratemaking purposes.
Respectfully submitted this 30th day of January, 1989.
LINDSAY, HAT, NEIL & WEIGLER
By c.ù L. C~ie ~
Roy L. EigU 'en
APPLICATION FOR APPROVAL - 6
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EXHIBIT A
FIRM ENERGY SALES AGREEMENT
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FIRM ENERGY SALES AGREEMENT
BETWEEN
IDAHO POWER COMPANY
AND
BYPASS LIMITED
TABLE OF CONTENTS
Article TITLE Page
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Defi nitions
No Re 1 i ance on Idaho Power
Warranties
Condi t ions to Interconnection
Term and Operation Date
Sale of Net Firm Energy
Purchase Pri ce and Method of Payment
Faci 1 i ty and Interconnection
Disconnection Equipment
Metering
Records
Protection
Operations
Indemnification and Insurance
Land Rights
Force Majeure
Liability; Dedication
Severa 1 Ob 1 i gat ions
Waiver
Choi ce of Laws
Disputes, Default, Notice and Liquidated
Damages
Governmenta 1 Authori zat ion
Commission Order
Successors and Assi gns
Modi fi cation
Taxes
Notices
Additional Terms and Conditions
Ent ire Agreement - Signatures
Appendix A
Appendix B
Appendix C
Appendix D
Appendix E
Appendix F
.~ Faci 1 ity No: 317l5l28
Project: Hazelton A
APPROVED PER COMMISSION
ORDER NO. 22326.
FIRM ENERGY SALES AGREEMENT ~-- ~ .,~~.~. Walte
Commssion Secretary
entered into on this I ~ of ~v~ , 1988,THIS AGREEMENT,
is between BYPASS LIMITED, a California limited partnership (Seller), and IDAHO
POWER COMPANY, a Maine corporation (Idaho Power) hereinafter sometimes referred
to collectively as IIpartieslI or individually as IIparty.1I
WIT N E SSE T H:
WHEREAS, Seller plans to construct, own and operate an electric
generation facility; and
WHEREAS, Sell er wi shes to sell, and Idaho Power has been ordered by
the Commission to agree to purchase electric energy from that facility.
THEREFORE, I n cons i de rat i on of the mutual covenants and agreements
hereinafter set forth, the Parties agree as follows:
ARTICLE I: DEFINITIONS
As used in thi s Agreement and the appendi ces attached hereto, the
following terms shall have the following meanings:
1. 1 IIAnnual Net Firm Energyll - The amount of Net Firm Energy Seller
estimates it will deliver to Idaho Power at the Point of Delivery during each
Contract Year.
1.2 IICommissionll - The Idaho Public Utilities Commission.
1. 3 IIContract Yearll - The period commencing each calendar year on
the same calendar date as the Operation Date and ending 364 days thereafter.
1.4 IIDesignated Dispatch Facilityll Idaho Power's Boise Bench
System Di spatch Center.
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1.5 IlDisconnection Eguipmentll - Any device or combination of devices
located on the interconnection between the Faci 1 i ty and Idaho Power's system by
which Idaho Power can manually and/or automatically interrupt the flow of power
from the Facility to Idaho Power's system. Disconnection Equipment includes
such enclosures or other facilities as may be required to ensure that only
Idaho Power will have access to the devices.
1.6 "First Energy Date" - The date when Seller has been inter-
connected wi th Idaho Power i s system and begi ns deli veri ng e 1 ectri c energy to
Idaho Power for purposes of demonstrati ng to Idaho Power the Faci 1 ity' s degree
of comp 1 et ion and re 1 i abi 1 ity.
1. 7 "Facility" - That electric generation facility described in
Appendi x B of thi s Agreement.
.1.8 "Interconnection Facilities" - All facilities required to be
installed solely to interconnect and deliver energy from the Facility to Idaho
Power's system including, but not limited to, connection, switching, metering,
relaying, communications and safety equipment.
1. 9 "Losses" - The 1 oss of energy occuri ng as a resu1 t of the
transformation and transmission of energy between the Facility and the Point of
Delivery.
1. iO "Net Firm Energyll The electric energy produced by the
Facility, less Station Use and less Losses, expressed in kilowatt hours
ei'KWH"), which Seller commits to deliver to Idaho Power at the Point of
Del ivery on a long-term average basis for the full term of the Agreement.
1. ii 1I0perat ion Datell - The day commenci ng at OOOl hours, fo 11 owi ng
the day on which the Facility demonstrates that it has been completed and
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reached a degree of re 1 i abi 1 i ty such that it is capable of deli veri ng Net
Energy continuously into Idaho Power's system.
1.l2 "Point of Delivery" - The location specified in Appendix B,
where Idaho Power's and Seller's electrical facilities are interconnected.
1.l3 "Prudent Electrical Practices" - Those practices, methods and
equipment that are commonly and ordinarily used in electrical engineering and
operations to operate electric equipment lawfully and with safety, depend-
ability, efficiency and economy.
1. l4 "Scheduled Operation Date" - The date specified in' Appendix B
when Sell er anticipates achievi ng the Operation Date.
1.l5 "Season" - The three periods identified in Article VI.
1. l6 II Seasona 1 Net Fi rm Energy" - The amounts of Net Fi rm Energy
Seller estimates it wi 11 del iver to Idaho Power at the Point of Del ivery during
each Season.
1.l7 "Special Facilities" - Those additions and alterations to Idaho
Power's system which are reasonably requi-red by Prudent Electrical Practices
and the national Electric Safety Code to interconnect the Facility safely to
Idaho Power's system.
1.l8 "Station Use" - Electric energy which is used solely to operate
the Facility's equipment which is auxiliary or directly related to the produc-
tion of electricity and which, but for the generation of electricity, would not
be consumed by Seller.
1. 19 II Surp 1 us Energy" El ectri c energy whi ch is deli vered and
accepted prior to the Operation Date or which Seller does not commit to provide
on along-term average bas is for the full term of the Agreement.
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ARTICLE II: NO RELIANCE ON IDAHO POWER
2. 1 Seller Independent Investigation - Except for the Disconnection
Equipment and any other facilities exclusively within the control of Idaho
Power, Sell er warrants and represents to Idaho Power that in enteri ng into thi s
Agreement and the undertaki ng by Seller of the ob 1 i gat i on set forth herei n,
Se 11 er has investigated and determi ned that it is capable of performi ng here-
under and has not re 1 i ed upon the advi ce, experi ence or expertise of Idaho
Power in connection with the transactions contemplated by this Agreement.
2.2 Seller Independent Experts Except for the Disconnection
Equipment and any other facilities within the exclusive control of Idaho Power,
all professionals or experts including, but not limited to, engineers,
attorneys or accountants, that Se 11 er may have consul ted or re 1 i ed on in
undertaking the transactions contemplated by this Agreement, have been solely
those of Seller.
ARTICLE III: WARRANTIES
3. 1 No Warranty by I daho Power - Any rev i ew , acceptance or fail ure
to review Seller1s design, specifications, equipment or facilities shall not be
an endorsement or a confirmation by Idaho Power, and Idaho Power makes no
warranties, expressed or implied, regarding any aspect of Seller1s design,
specifications, equipment or facilities, including but not limited to safety,
durability, reliability, strength, capacity, adequacy or economic feasibility.
3.2 Qualifying Facility Status - Seller warrants that the Facility
is a IIqua 1 ifyi ng facil i ty, II as that term is used and defi ned in l8 CFR, Part
292. Seller will take such steps as may be required to maintain the Facility.s
IIqualifying facilityll status during the term of this Agreement.
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ARTICLE IV: CONDITIONS TO INTERCONNECTION
4. 1 Prior to the First Energy Date and as a condition of inter-
connection with Idaho Power, Seller shall:
4.1. 1 Submit proof to Idaho Power that all 1 icenses, permits or
approvals necessary for Seller's operations have been obtained from
applicable federal, state or local authorities, including but not limited
to, those licenses, permits or approvals specified in Appendix C.
4.1.2 Submit to Idaho Power an opinion of counsel signed by an
attorney admitted to practice and in good standing in the State of Idaho
cert i fyi ng as follows:
(l) That Seller has obtained the necessary licenses, permits
and approvals reaui red by paragraph 4. l. l;
(2) That the attorney has reviewed the approved Application for
Permi t to Appropri ate Water referred to in Appendi xC;
(3) That downstream of the Facility, there are existing,
non-condemnable senior water rights sufficient to ensure the availability
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of the wat~r ri ghts app 1 i ed for in the App 1 i cat i on for Permi t to
appropri ate water referred to in Appendi xC;
(4) That the non-condemnable water rights described in (3)
above are senior to the Facility.s requested water rights and are not
dependent on inflows below Seller's Point of Diversion specified in the
App 1 i cat i on for Permit to Appropri ate Water referred to in Appendi xC.
(5) That the attorney has read Commission Order No 21690 and it
is hi s 1 ega 1 opi ni on that Sell er possesses water ri ghts that do not
require the application by Idaho Power of the "K" factor described in said
Order.
4.1. 2. 1 The opi ni on of counsel requi red in 4.1.2 above
wi 11 be ina form acceptable to Idaho Power and wi 11 acknow1 edge that
the attorney renderi ng the opi ni on understands that Idaho Power is
relying on said opinion. Idaho Power's acceptance of the form will
not be unreasonably wi thhe1 d.
4.1.3 Make payment to Idaho Power for all costs of Di scon-
nection Equipment, metering and telemetry equipment and Special Facilities
as provi ded for in Appendi x B of thi s Agreement;
4.l.4 Obtain written acceptance from Idaho Power as provided in
paragraph 8.3;
4.1.5 Submit written proof to Idaho Power of all insurance
required in Article XIV;
4.1.6 Demonstrate to Idaho Power's satisfaction that Seller's
Facility has been completed, and is capable of operating safely to
commence deli veri es of e 1 ectri c energy into Idaho Power i s system;
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4.l.7 Demonstrate to Idaho Power's satisfaction that the Seller
has estab 1 i shed a maintenance reserve account ina form and wi th a fund
holder which complies with_Commission Order Nos 21690 and 2l800. Said
mai ntenance reserve account shall be structured and funded as follows:
4.1.7.l The escrow instructions establishing the mainte-
nance escrow account wi 11 provi de that the funds in the mai ntenance
escrow account wi 11 be prudently invested and that all costs of
imp 1 ement i ng and ope rat i ng the maintenance escrow account shall be
paid by the Seller. All interest earned on the funds on deposit will
be retained in the maintenance reserve account. At the end of the
term of thi s Agreement, any balance remai ni ng in the mai ntenance
reserve account shall be the property of the Sell er.
4.l.7.2 Within 60 days after the completion of each
Contract Year, the Sell er wi 11 depos i t cash in the mai ntenance escrow
account in an amount equal to 2% of the Facility's estimated gross
income for the ensui ng Contract Year, 1 ess an amount equal to the
Faci 1 i ty iS actual maintenance, repair and replacement expense
(ma i ntenance expenses) incurred duri ng the pri or Contract Year.
4.l.7.3 At the time Seller makes the deposit described in
paragraph 4.1. 7.2, Sell er wi 11 provi de both the Escrow Manager and
Idaho Power with a report prepared by Sellerl s outside accountants
showing the prior Contract Years actual maintenance expenses,
i dent ifi ed by appropri ate FERC maintenance account number, and the
estimate of the Facility's gross income for the ensuing Contract Year
used to compute the deposit amount, together with documentati on
supporting that estimate of gross income.
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4.1. 7.4 If at any time it appears that the mai ntenance
expense for that Contract Year wi 11 exceed 2% of the Faci 1 ity. s
estimated gross income for that Contract Year, the Seller may request
that the Escrow Manager re 1 ease funds from the maintenance escrow
account in an amount sufficient to pay the anticipated additional
maintenance expenses. The request must include documentation
supporting the Seller's projection of excess maintenance expense,
i dentifi ed by appropri ate FERC mai ntenance account number, and such
documentation shall be submitted to both the Escrow Manager and Idaho
Power. Following receipt of the request and documentation, the
Escrow Manager, shall, within five working days, release the required
funds to Seller.
4.1. 7.5 At the end of each Contract Year; Sell er wi 11
provi de Idaho Power wi th evi dence of compl i ance wi th the mai ntenance
escrow account requi rements set out in thi s Agreement and Commi ss i on
Order Nos 21690 and 2l800. Thi s evi dence of comp 1 i ance wi 11 be
provided in a manner and form acceptable to Idaho Power. The mainte-
nance reserve fund will be subject to the lien rights described in
4. 1. 8 be low.
4.1.8 Provide Idaho Power with acceptable lien rights. It is
recognized and agreed that for Idaho Power i s 1 ien rights to be acceptable,
Idaho Power will have, subject to the lien rights of Sell~r's construction
and permanent fi nanci ng 1 ender, such ri ghts as may be necessary to allow
Idaho Power to expeditiously assume ownership and operation of the
Facility, including any Seller-owned Interconnection Equipment or other
appurtenances if Seller fails to cure any default in accordance with
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paragraph 2l.2 of the Agreement. Acceptable 1 i en ri ghts wi 11 conform to
COßli ss i on Order Nos 21690 and 21800 and may inc 1 ude, but wi 11 not be
limited to, title insurance, mortgage(s), deed(s) of trust, lease assign-
mentes), assignment(s) of contract rights, and lease(s), the FERC license,
or exempti on from li censi ng, water ri ghts, other governmental permi ts ,
rights-of-way, subordination agreements, funds held in escrow in which
Seller has an interest and that relate to the operation of the Facility,
and other reasonable security arrangements cons i stent wi th the Seller IS
construction and final permanent financing. All lien rights will be in a
form acceptable to Idaho Power. Acceptance of 1 i en ri ghts wi 11 not be
unreasonab ly wi thhe 1 d.
4.1. 8. 1 Idaho Power iS 1 i en ri ghts wi 11 be superi or and
senior to all liens other than those mortgages and/or other security
agreements securing the construction and permanent loan financing for
the Facility.
4.1.8.2 Other than the liens described herein, Seller will
not allow any 1 i ens or encumbrances of any nature whatsoever to be
placed on the Facility. If any such unpermitted lien or encumbrance
is placed on the F aci 1 i ty, Sell er wi 11 provi de Idaho Power a bond or
insurance suffi ci ent to secure its di scharge.
4.l.8.3 As soon as practicable, Seller will provide
Idaho Power, for Idaho Power iS revi ew and approval, drafts of all
mortgages and/or other security agreements that Seller intends to use
to secure the permanent loan financing for the Facility. Idaho Power
must notify Seller of its acceptance or rejection of the draft
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financing submittal in writing no later than thirty days from Idaho
Power i s receipt thereof. If Idaho Power does not object within such
thirty-day period, it will be deemed to have approved the draft
financing submittal. Seller will not materially alter any provision
of the final financing documents directly affecting Idaho Power's
1 i en ri ghts from that approved in draft form. As soon as pract icab 1 e
thereafter, but not later than six (6) months after the Operation
Date, Seller shall provide Idaho Power with copies of the permanent
financing documents in their final executed form. Idaho Power shall
have 14 days after such final documents are delivered to review them
for the purpose of determining whether any provision directly
affect i ng its second 1 i en ri ghts have been materi ally changed from
the draft documents previ ous ly provi ded. If Idaho Power does not
obj ect wi thi n such l4 day peri od, it wi 11 be deemed to have approved
the documents. When the permanent fi nanci ng documents have been
de 1 i vered to Idaho Power in the i r fi na 1, executed form, the same
sha 11 not be amended, modi fi ed, or extended, and no refi nanci ng of
any nature beyond that allowed pursuant to Paragraph 4.1. 8. 5 shall be
undertaken. I n no event wi 11 the amount of the fi rst mortgage 1 i en
or any rep 1 acement fi rst mortgage 1 i en exceed $l8, 000,000.
4.1.8.4 During the time period between the First Energy
Date and Idaho Powerl s approval of the permanent loan financing
documents pursuant to the previ ous subparagraph, Idaho Power shall
pay Se 11 er for all energy deli vered at the Surplus Energy Purchase
Price as provided for in Paragraph 7.2 herein. Once the final
fi nanci ng documents are approved by Idaho Power pursuant to the
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previous subparagraph, Idaho Power will retroactively pay Seller for
a 11 energy deli vered by Sell er from the Fi rst Energy Date at the rate
specifi ed in Paragraphs 7. land 7.1. 2 herei n, 1 ess the amounts
actually paid Seller at the rate specified in Paragraph 7.2.
4.1. 8. 5 Seller may incur replacement fi rst mortgage 1 i ens
against the Facility in accordance with this subparagraph. Replace-
ment fi rst mortgage 1 i ens shall not be in an amount exceedi ng the
unpaid balance of the replaced mortgage. The Seller shall not, incur
replacement liens except to obtain lower rates of interest, to
provide for the long-term refinancing of the construction loans for
the Facility, to finance the replacement or repair of equipment
associated with the Facility, or to cure default by the Seller.
Replacement mortgages will be subject to Idaho Power's prior consent,
which consent will not be unreasonably withheld.
4.1.9 Obtain written confirmation from Idaho Power that all
conditions to interconnection have been fulfilled. It is understood that
such written confirmation shall not be unreasonably withheld by Idaho
Power.
ARTICLE V: TERM AND OPERATION DATE
5. i Term - Except as provided in Article XXIII, this Agreement shall
become effective on the date first above written, and shall continue in full
force and effect for a period of twenty (20) Contract Years.
5.2 Operation Date - The Ope rat i on Date may occur on ly after Seller
has achieved the First Energy Date, and the necessary degree of completion .and
reliability has been demonstrated to Idaho Power's satisfaction, and Idaho
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Power has conf;-rmed that satisfaction in writin~. Seller shall have the duty
to obtain that confirmation and it will not be unreasonably withheld by Idaho
Power. Prior to the Operation Date, Seller must provide the following:
(l) As-built drawings of the Seller-furnished Interconnection
Equipment, and
(2) Executed Certification of Design Engineer, Engineer1s
Certification of Design & Construction Adequacy, and Engineer's Certification
of Operations and Maintenance Policy as described in Commission Order No 2l690.
These certificates will be in the form specified in Appendix F, but may be
modi fi ed to the extent necessary to recogni ze the di fferent engi neeri ng
di scip1ines providi ng the certi ficates.
ARTICLE VI: SALE OF NET FIRM ENERGY
6. 1 Del ivery and Acceptance of Net Firm Energy - Except when either
party's performance is prevented by events of force majeure (Article XVI) or
otherwi se excused as provi ded herei n, Idaho Power shall purchase all of the Net
Firm Energy and Surplus Energy produced by the Facility and delivered by Seller
to the Poi nt of De 1 i very.
6.2 Seasonal Net Fi rm Energy Amounts - Based on long-term historical
water flow records and average long-term average energy production estimates
based thereon, Seller estimates that it can deliver Net Firm Energy in the
following monthly amounts:
Season i
March
April
May
55,894 KWH
l,844,320 KWH
4,470,l36 KWH
4,848,324 KWH
5,54l,807 KWH
5,236,000 KWH
3, 910 ,854 KWH
Season 2
June
July
August
September
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Season 3
October
November
December
January
February
1 t 853 t 226 KWH
653t870 KWH
o KWH
o KWH
o KWH
6.3 Annual Net Firm Energy Amount - The Annual Net Firm Energy shall
be 28,4l4t43l KWH and shall be the sum of the three Seasonal Net Firm Energy
amounts Seller specified above.
6.4 Normal Water Conditions - The Net Firm Energy amounts Seller has
estimated it can supply are based upon the anticipated long-term average water
flows at the Facility. The parties have reviewed these anticipated water
flows, Seller1s water right filings and the water records supporting those
projected water flows and have agreed thatt for purposes of this Agreement, the
projected water flows used to calculate the Annual Net Firm Energy amount in
paragraph 6.3 are reasonable and shall constitute the water flows available to
the Facility under IInormalll water conditions. No later than l20 days after the
Operation Datet Seller will install such water flow measuring equipment as is
reasonab ly requi red to permi t the parties to monitor the water flows at the
Facility site. Seller will operate and maintain this water flow measuring
equipment and will perform such other water flow analyses as may be required to
carry out the provisions of Article XXI.
6. 5 Net Fi rm Energy Changes -
6.5.l Increased Generation Capability - If, at any time during the
term of thi s Agreement, as a resul t of some action by Sell er, ie, procurement
of additional long-term water suppl ies or improvements to the efficiency of the
installed generating equipment, Seller intends to permanently increase the
amount of Annual Net Firm Energy from the Facil ity above the amount specified
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in paragraph 6.3 above, Seller will promptly notify Idaho Power of that intent.
If Idaho Power concurs that Seller is capable of actually providing such
increased Net Fi rm Energy, Idaho Power wi 11 have the opti on to purchase thi s
increased amount of Net Fi rm Energy in accordance wi th ei ther of the fo 11 owi ng
alternatives: (l) the purchase will be under the same terms and conditions of
thi s Agreement except that the rate for the incremental increase of Net Fi rm
Energy shall not be the rate in paragraph 7. 1 of thi s Agreement, but instead
wi 11 be pri ced at the appropri ate fi rm energy rate in effect at the time of
such increase; or (2) the purchase wi 11 be made under a separately negoti ated
agreement. The choice of purchase alternative will be Idaho Power1s.
6.5.2 Subsequent Determination that Facil ity Capacity Exceeds Ten
Megawatts - Cogeneration and small power production facilities with a capacity
larger than LO MW are not entitled to the rates contained in this Agreement.
The rates, terms and conditions of this Agreement are premised on Seller's
representation that the capacity of the Facility is not larger than LO MW. If,
at any time, the Facility's capacity actually exceeds LO MW, Idaho Power will
notify Seller and the Commission and provide them with the information which
supports that determi nati on.
If the Commission determines that the Facility1s capacity actually
exceeds LO MW, then thi s Agreement wi 11 be modifi ed by the Commi ss ion.
ARTICLE VII: PURCHASE PRICE AND METHOD OF PAYMENT;
ADJUSTMENT OF PURCHASE PRICE
7. 1 Net Firm Energy Purchase Pri ce - The pri ce to be paid to Se 11 er
for Net Firm Energy will be the sum of the following payments:
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7. l. 1 Base Payment -
Season 1 28.55 Mi 11 s/KWH
Season 2 45.67 Mi 11 s/KWH
Season 3 38.06 Mi 11 s/KWH
7.1.2 Adjustable Payment - In addition to the Base Payment specified
in paragraph 7.l.l, Idaho Power shall pay to Seller an Adjustable Payment of
3.26 mi 11 s per ki lowatt hour for Net Fi rm Energy deli vered and accepted in
Season land 5.21 mills per KWH for Net Firm Energy delivered and accepted in
Season 2 and 4.34 mills per KWH for Net Firm Energy delivered and accepted in
Season 3. The Adjustable Payment shall be subject to change pursuant to
Commission Order at such time as Idaho Power1s retail rates are revised by
Commi ss i on Order.
7.2 Surplus Energy Purchase Pri ce - Surplus Energy wi 11 be purchased
at the non-firm avoided energy rate in effect at the time of delivery. This
rate is calculated monthly and is filed with the Commission.
7.3 Continuing Jurisdiction of the Commission - This agreement is a
special contract and as such, the rates, terms and conditions contained in this
Agreement wi 11 be construed in accordance with Idaho Power Company v. Idaho
Pulic utilities Comm'n and Afton Energy, inc, l07 Idaho 78l, 693 P2d 427
(l984), Idaho Power Company v. Idaho Pulic utilities Comm'n, l07 Idaho ll22,
695 P2d l261 (Idaho 1985), Afton Energ, Inc, v. Idaho Power Company, III Idaho
925, 729 P2d 400 (l986), Section 210 of the Public Utilities Regulatory
Policies Act of 1978 and 18 CFR §292.303-308.
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ARTICLE VIII: FACILITY AND INTERCONNECTION
8.l Design of Facility - Seller shall design, construct, install,
own, operate and maintain the Facility. The Facility shall be designed and
constructed so as to allow safe, re 1 i ab 1 e deli very of e 1 ectri c energy to Idaho
Power's system.
8.2 Interconnection Facilities - Except for the Special Facilities,
metering and telemetry equipment and Disconnection Equipment specified in
Appendix Bt Seller shall constructt install t ownt and maintain all Inter-
connection Facilities. Seller will pay all costs of interconnecting the
Facility with Idaho Power.
8.3 Idaho Power Review - To assure the Facility and Seller-furnished
Interconnection Facilities are of suitable size and are compatible with Idaho
Power's system, Seller shall submit the designs, planst specifications and
performance data for the Facility and Seller-furnished Interconnection
Facilities to Idaho Power for review. Idaho Power shallt in writing and in
conformance wi th paragraph 4. l. 4, notify Sell er of its acceptance and confi r-
mation of system compatibility or converselYt notify Seller, in writing, of any
changes whi ch, cons i stent wi th Prudent El ectri ca 1 Practices, Idaho Power
determines are necessary to assure the safe delivery of electric energy from
the Faci 1 ity to Idaho Powerl s system.
ARTICLE IX: DISCONNECTION EQUIPMENT
9.l Disconnect Equipment - Idaho Power willt at Seller's expense,
providet own, operatet and maintain all Disconnection Equipment. At Seller's
request, Idaho Power wi 11 provi de Seller wi th the general speci fi cat ions and an
itemization by category of the costs of such Disconnection Equipment. Idaho
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Power will establish the settings of Disconnection Equipment to disconnect
automatically from the Facility for the protection of Idaho Power's system and
personnel consistent with Prudent Electrical Practices. Upon Seller's request,
Idaho Power will notify Seller as to the original setting and any adjustments
thereof. Except as otherwise required by Prudent Electrical Practices, Dis-
connection Equipment will be designed so that the closure of any breaker or
other disconnecting device which connects the Facility to Idaho Power's system
shall be controlled by equipment which will perform the following:
(1) Automatically monitor the status of the electrical system
on Idaho Power's side of the disconnecting device; as to voltage and frequency;
and
(2) Prohibit closure or reconnection until voltage and
frequency have been wi thi n approved 1 i mi ts for a continuous peri od of not 1 ess
than fi ve mi nutes; and
(3) Operate so that if Idaho Power's system is de-energized
within 60 seconds after closure of the disconnecting device, the disconnecting
device will immediately open and not close again until it has been manually
reset and/or Idaho Power can safely reclose the Disconnecting Equipment.
9.2 Security of Disconnect Eguipment - The Disconnection Equipment
wi 11 be located in an enclosure secured by a lock or otherwi se secured ina
manner designed to ensure that only Idaho Power's authorized personnel will
have access to the disconnecting devices.
9.3 Remote Disconnection - Other Disconnection Equipment, including
equipment which will provide Idaho Power1s operating personnel with the ability
to remotely control and moni tor the status of the breaker or other di scon-
nect i ng devi ce by radi 0 or hard-wi re ci rcuit between the Fad 1 i ty and the
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Designated Dispatch Facility may be specified by Idaho Powér when, in Idaho
Power i s reasonable judgment, such equipment is required by Prudent Electrical
Practices. Seller recognizes that such remote control equipment may not
initially be required by Idaho Power, but at such time as operating conditions
on Idaho Power's system dictate, Idaho Power will install this remote control
equipment at Seller's expense. If Seller disputes Idaho Power1s determination
that the installation of such remote Disconnection Equipment is required, such
dispute shall be submitted to the Commission for resolution.
9.4 Interference with Disconnection Eguipment - If Seller attempts
to modify, adjust or otherwise interfere with the Disconnection Equipment or
its enclosure, such action shall constitute an event of default pursuant to
Article XXI.
ARTICLE X: METERING
LO.L Metering and Telemetry - Idaho Power shall, for the account of
Seller, provide, install, and maintain required metering equipment to be
located at a mutually agreed upon location to record and measure power flows to
Idaho Power in accordance with the standards set forth in Appendix A. If
required by Idaho Power, metering will also include measurement of kilovar-
hours ina manner agreed to by both parti es. A 11 meter equipment and
installation costs shall be borne by Seller, including costs incurred by Idaho
Power for inspecting and testing such equipment at reasonable i nterva 1 s at
Idaho Power1s actual cost of providing this equipment and services. The point
of metering shall be at the location described in Appendix B. All meters used
to determine the billing hereunder shall be sealed and the seals shall be
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broken only upon occasions when the meters are to be inspected, tested or
adjusted.
LO.2 Meter Inspection - Idaho Power shall inspect and test all meters
upon their installation and at least once every four years thereafter. If
requested by Seller, Idaho Power shall make a special inspection or test of a
meter and Seller shall pay the reasonable costs of such special inspection.
Both parties shall be notified of the time when any inspection or test shall
take place, and each party may have representatives present at the test or
inspection. If a meter is found to be inaccurate or defective, it shall be
adjusted, repaired, or replaced, at Idaho Power's expense, in order to provide
accurate metering. If a meter fails to register, or if the measurement made by
a meter duri ng a test varies by more than two percent from the measurement made
by the standard meter used in the test, adjustment (either upward or downward)
to the payments Seller has received shall be made to correct those payments
affected by the inaccurate meter for the actual peri od duri ng whi ch inaccurate
measurements were made. If the actual period cannot be determined, corrections
to the payments wi 11 be based on the shorter of (l) a peri od equal to one-half
the time from the date of the 1 ast previ ous test of the meter to the date of
the test which established the inaccuracy of the meter; or (2) six (6) months.
LO.3 Telemetry - Idaho Power will install, operate and maintain at
Seller's expense metering, communications and telemetry equipment which will be
capable of providing Idaho Power with continuous instantaneous telemetry of
Seller's net generation to Idaho Power's Designated Dispatch Facility.
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ARTICLE XI: RECORDS
ll.l Maintenance of Records - Seller shall maintain at the Facility
or such other location mutually acceptable to the parties, adequate metering
and related power production records, ina form and content recommended by
Idaho Power.
ll.2 Inspection - Either party, after reasonable notice to the other
party, shall have the right, during normal business hours, to inspect and audit
any or all such metering and related power production records pertaining to
Seller's account.
ARTICLE XII: PROTECTION
l2.l Seller shall construct, operate and maintain the Facility and
Seller-furnished Interconnection Facilities in accordance with Appendix A,
Prudent El ectri ca 1 Practices, the Nat i ona 1 El ectri c Safety Code and any other
applicable local, state, and federal codes. If, in the reasonable opinion of
Idaho Power, Seller's operation of the Facility or Interconnection Facilities
is unsafe or may otherwise adversely affect Idaho Power's equipment, personnel,
or service to its customers, Idaho Power may physically interrupt the flow of
energy from the Facility or take such other reasonable steps as Idaho Power
deems appropri ate. Except in the case of an emergency, Idaho Power wi 11
attempt to notify Seller of such interruption pri or to its occurrence as
provided in paragraph 13.8. Seller shall provide and maintain adequate pro-
tective equipment sufficient to prevent damage to the Facility and Seller-
furnished Interconnection Facilities. In some cases, some of Seller's
protective relays will provide back-up protection for Idaho Power's facilities.
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In that event, Idaho Power will test such relays annually and Seller will pay
the actual cost of such annual testing.
ARTICLE XIII: OPERATIONS
l3. 1 Emergency Condi t ions - Se 11 er agrees that in the event of and
during a period of a shortage of power on Idaho Power i s system as declared by
Idaho Power in its reasonable discretion, Seller shall, at Idaho Power1s
request and within the limits of reasonable safety requirements as determined
by Seller, use its best efforts to provide the requested energy, and shall, if
necessary, delay any scheduled shutdown of the Facility.
l3.2 Communications - Idaho Power and Seller shall maintain
appropriate operating communications through Idaho Power1s Designated Dispatch
Facility, and Seller shall report to Idaho Power at the times and in the manner
set forth in Appendix A.
13.3 Energy Acceptance - Idaho Power shall be excused from accepti ng
and paying for Net Firm Energy delivered by Seller to the Point of Delivery
under the following circumstances:
l3. 3. 1 If it is prevented from doi ng so by an event of force
majeure.
l3. 3. 2 If Idaho Power determines that curtai lment, interruption
or reduction of Net Firm Energy deliveries is necessary because of line
constructi on or mai ntenance requi rements, emergenci es, operati ng condi-
t ions on its system, or as otherwi se requi red by Prudent El ectri ca 1
Practi ces. If, for reasons other than an event of force majeure, Idaho
Power requi res such a curtail ment, interruption or reduction of Net Fi rm
Energy del iveries for a period that exceeds twenty days beginning with the
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twenty-first day of such interruption, curtailment or reduction, Seller
. wi 11 be deemed to be deli veri ng Net Fi rm Energy at a rate determi ned by
dividing the Annual Firm Net Energy amount by 8760 hours. Idaho Power
wi 11 notify Seller when the interruption, curtai 1 ment or reduction is
termi nated.
l3.4 Voltage Levels - Seller shall use its best efforts to minimize
voltage swings and to maintain voltage levels acceptable to Idaho Power. Idaho
Power may, upon one hundred eighty (l80) days' notice to Seller, change its
nominal operating voltage level by more than ten percent (LO%) at the Point of
Delivery, in which case Seller shall modify, at Idaho Power's expense, Seller's
equipment as necessary to accommodate the modified nominal operating voltage
1 evel.
l3.5 Generator Ramping - Idaho Power shall have the right to specify
the rate that generation is changed at startup, during normal operation or
following reconnection to Idaho Power's system. Generation ramping may be
required to permit Idaho Power's voltage regulation equipment time to respond
to changes in power flow.
13.6 Schedul ed Mai ntenance - On or before January 1 of each year,
Seller shall submit a proposed maintenance schedule for that year and Idaho
Power and Seller shall mutually agree as to the acceptabil i ty or unaccept-
ability of the proposed date(s). The parties' determination as to the
acceptability of Seller's timetable for scheduled maintenance will take into
consideration Prudent Electrical Practices and neither party shall unreasonably
withhold its acceptance of the proposed date for scheduled maintenance.
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l3.7 Maintenance Coordination - The parties shall, to the extent
practical, coòrdinate their respective line and Facility maintenance schedules
such that they occur simultaneously.
l3.8 Contact Prior to Curtailment Idaho Power will make a
reasonab 1 e attempt to contact Sell er pri or to exerci sing its ri ghts to curtai 1 ,
interrupt or reduce deli veri es from Seller. Se 11 er understands that in the
case of emergency circumstances, no notice will be given to Seller prior to
interruption, curtailment, or reduction.
ARTICLE XIV: INDEMNIFICATION AND INSURANCE
l4.l Indemnification - Each party shall agree to hold harmless and
to indemnify the other party, its officers, agents, and employees against all
los s, damage, expense and 1 i abi 1 i ty to th i rd persons for i nj ury to or death of
person or injury to property, proximately caused by the indemnifying party's
construction, ownership, operation or maintenance of, or by failure of, any of
such party.s works or facilities used in connection with this Agreement. The
i ndemni fyi ng party shall, on the other party. s request, defend any sui t
asserting a claim covered by this indemnity. The indemnifying party shall pay
all costs that may be incurred by the other party in enforcing this indemnity.
l4.2 Insurance - During the term of this agreement, Seller shall
secure and continuously carry the following insurance coverages:
l4.2.l Comprehensive General Liability Insurance for both
bodily injury and property damage with 1 imits equal to l5% of the total
cost of the Facility, or $1,000,000, whichever is greater, each
occurrence, Combined single limit. The deductible for such insurance
shall not exceed 0.5% of the total cost of the Facility.
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l4.2.2 Property Insurance for catastrophic perils with minimum
limits not less than 60% of the total cost of the Facility. The Property
Insurance coverage will include:
(a) Standard fi re pol icy.
(b) Extended coverage endorsement.
(c) Vandalism and malicious mischief endorsement.
(d) Earthquake and flood insurance.
(e) This insurance must be written on a IIReplacement Costll
basi s.
(f) The deductible for the above Property Insurance coverage
shall not exceed L.O% of the total cost of the Facility.
l4.2.3 Boiler and Machinery Insurance with minimum limits not
less than 90% of the total cost of the equipment covered in (a) below:
(a) All Boiler and Machinery coverage must be written on a
II comprehens i ve formll bas is to provi de coverage against the sudden and
accidental breakdown of all boilers, machinery and electrical equipment,
turbi nes, generators, and switchgear.
(b) Coverage under this insurance must be written on a
II Rep 1 acement Cos t II bas is.
(c) The deductible for this insurance shall not exceed 2.0% of
the total cost of the equipment covered in (a) above.
l4. 2. 4 Busi ness Interruption (Loss of Income) Insurance with
minimum daily limits not less than 75% of the Facility's estimated gross
daily revenue and total policy limits not less than 20% of the Facility's
estimated gross annual revenue:
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(a) Coverage will include Seller1s loss of earnings when
business operations are curtailed or suspended because of a loss due to an
insured periL. Coverage may be written on an actual loss sustained basis.
(b) Thi s insurance coverage must be endorsed to the Property
Insurance Policy and the Boiler and Machinery Insurance Policy.
(c) The deductible for this insurance coverage shall not exceed
LO days.
(d) Estimated gross daily revenue and estimated gross annual
revenue shall be computed on the basis of the kilowatt-hour production
estimates contai ned in paragraph 6.2.
l4. 2. 5 Low Water Insurance:
(a) Low water insurance means insurance whi ch provi des coverage
for reduced project revenues resul ti ng from reduced generati on due to
water flows at the project being less than the long-term average water
flows established by the parties under Paragraph 6.4.
(b) The annual pol icy 1 imits shall be not less than 25% of the
estimated gross annual revenue for the Facility.
(c) The deduct i b 1 e for thi s insurance coverage shall not exceed
LO% of the Faci 1 ity. s estimated gross annual revenue.
(d) The estimated gross annual revenue shall be computed on the
basis of the kilowatt-hour production estimates contained in
paragraph 6.2.
l4. 2. 6 A 11 of the above insurance coverages shall i ncl ude:
(a) An endorsement nami ng Idaho Power as an addi tiona 1 insured
and loss payee as app 1 i cab 1 e;
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(b) A provision stating that such policies shall not be
cancelled or their limits of liability reduced without sixty (60) days.
prior written notice to Idaho Power.
(c) In the case of the insurance coverages described in sub-
paragraphs l4.2.l, l4.2.2 and l4.2.3 above, the total cost of the Facility
will include any Seller-furnished Disconnection Equipment and/or Inter-
connection Facilities. The total cost of the Facility and total cost of
equipment wi 11 be adjusted either upward or downward to refl ect the
current replacement cost of the Facility or equipment. This adjustment
will be based on the Handy-Whitman Index llCost Trends of Electric Utility
Construction -- Plateau Regionll -- llHydro Production Plantll as published
by Whitman, Requardt & Associates, 2315 Saint Paul St, Baltimore, MD
2l2l8. Such adjustment shall be made every fi fth Contract Year duri ng the
term of thi s Agreement. Sell er wi 11 make these computations and wi 11
expeditiously submit them to Idaho Power for Idaho Power. s review and
approval.
l4.3 Seller to Provide Certificates of Insurance - As required in
paragraph 4.1.5 herein and annually thereafter, Seller shall furnish Idaho
Power cert ifi cates of insurance, together with the endorsements requi red
therei n, evi denci ng the coverages as set forth above.
l4.4 Seller to Provide Copies of Policies of Insurance - Within l20
days after the Operation Date, and within 90 days of the effective date of any
modifications to the policy, Seller will furnish to Idaho Power a certified
copy of the original of each insurance pol icy and all endorsements for each of
the insurance coverages described above. In the case of policy renewals,
Seller may provide a certificate from the insurance carrier that there have
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been no changes to the pol icy in 1 i eu of provi di ng the requi red cert ifi ed copy
of the policy.
l4.5 Seller to Notify Idaho Power of Lapse of Coverage - If any of
the insurance coverages requi red by paragraph l4.2 shall 1 apse for any reason,
Seller will immediately notify Idaho Power in writing. The notice will advise
Idaho Power of the speci fi c reason for the 1 apse and the steps Sell er is taki ng
to reinstate the coverage.
ARTICLE XV: LAND RIGHTS
l5. 1 Seller to Provide Access - Seller hereby grants to Idaho Power
for the term of thi s Agreement all necessary ri ghts of way and easements to
install, operate, maintain, replace, and remove Idaho Power's metering equip-
ment, Disconnection Equipment and other Special Facilities necessary or useful
to thi s agreement, inc 1 udi ng adequate and conti nui ng access ri ghts on property
of Seller. Se 11 er warrants that it has procured suffi ci ent easements and
rights of way from third parties so as to provide Idaho Power with the access
descri bed above. A 11 documents granting such easements or ri ghts of way shall
be subject to Idaho Power's approval and in recordable form.
l5.2 Use of Public Rights-of-Way - The parties agree that it is
necessary to avoid the adverse environmental and operating impacts that would
occur as a result of duplicate electric lines being constructed in close
proximity. Therefore, subject to Idaho Power's compliance with paragraph l5.4,
Seller agrees that should Seller seek and receive from any local, state or
federal governmental body the right to erect, construct and maintain Seller-
furnished Interconnection Facilities upon, along and over any and all public
roads, streets and hi ghways, then the use by Seller of such publ i c right-of-way
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shall be subordinate to any future use by Idaho Power of such public right-
of-way for construction and/or maintenance of electric distribution and
transmission facilities and Idaho Power may claim use of such public right-
of-way for such purposes at any time. Except as required by paragraph l5.4,
Idaho Power shall not be required to compensate Seller for exercising its
rights under thi s paragraph l5.2.
l5.3 Joint Use of Facilities - Subject to Idaho Power1s compliance
with paragraph 15.4, Idaho Power may use and attach its distribution and/or
transmission facilities to Seller1s Interconnection Facilities~ may
reconstruct Seller1s Interconnection Facilities to accommodate Idaho Power1s
usage or Idaho Power may construct its own distribution or transmission
facilities along, over and above any public right-of-way acquired from Seller
pursuant to paragraph l5.2, attaching Seller's Interconnection Facilities to
such newly constructed facilities. Except as required by paragraph l5.4, Idaho
Power shall not be required to compensate Seller for exercising its rights
under thi s paragraph l5.3.
l5.4 Conditions of Use - It is the intention of the parties that the
Seller be left in substantially the same condition, both financially and
electrically, as Seller existed prior to Idaho Power's exercising its rights
under this Article XV. . Therefore, the parties agree that the exercise by Idaho
Power of any of the ri ghts enumerated in paragraphs l5.2 and l5.3 shall: (l)
comp ly with all app 1 i cab 1 e 1 aws, codes and Prudent El ectri ca 1 Practices, (2)
equitably share the costs of installing, owning and operating jointly used
facilities and rights-of-way. If the parties are unable to agree on the method
of apportioning these costs, the dispute will be submitted to the Commission
for resolution and the decision of the Commission will be binding on the
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parties, and (3) shall provide Seller with an interconnection to Idaho Power's
system of equal capacity and durability as existed prior to Idaho Power
exercising its rights under this Article xv.
ARTICLE XVI: FORCE MAJEURE
As used in this Agreement, "force majeure" or "an event of force
majeure" means any cause beyond the control of the Seller or of Idaho Power
which, despite the exercise of due diligence, such party is unable to prevent
or overcome, including but not limited to an act of God, fire, flood, explo-
sion, strike, sabotage, an act of the public enemy, civil or military
authority, court orders, laws or regulations, insurrection or riot, an act of
the elements or lack of precipitation resulting in reduced water flows for
power production purposes. If either party is rendered wholly or in part
unable to perform its obligations under this Agreement because of an event of
force majeure, both parties shall be excused from whatever performance is
affected by the event of force majeure, provi ded that:
(l) The non-performing party shall, as soon as is reasonably
possible after the occurrence of the event of force majeure, give the other
party written notice describing the particulars of the occurrence.
(2) The suspension of performance shall be of no greater scope
and of no longer duration than is required by the event of force majeure.
(3) No obl igations of either party which arose before the
occurrence causing the suspension of performance and which could and should
have been fully performed before such occurrence shall be excused as a resul t
of such occurrence.
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ARTICLE XVII: LIABILITY; DEDICATION
Nothi ng in thi s Agreement shall be construed to create.. any duty to,
any standard of care with reference to, or any 1 i abi 1 ity to any person not a
party to thi s Agreement. No undertaki ng by one party to the other under any
provision of this Agreement shall constitute the dedication of that party. s
system or any portion thereof to the other party or to the pub 1 i c ,nor affect
the status of Idaho Power as an independent public utility corporation, or
Seller as an independent individual or entity.
ARTICLE XVIII: SEVERAL OBLIGATIONS
Except where sped fi ca 11y stated in this Agreement to be otherwi se,
the duties, obligations and liabilities of the parties are intended to be
several and not joint or collective. Nothing contained in this Agreement shall
ever be construed to create an association, trust, partnership, or joint
venture or impose a trust or partnership duty, obligation or liability on or
with regard to either party. Each party shall be individually and severally
1 i ab1 e for its own ob 1 i gat ions under thi s Agreement.
ARTICLE XIX: WAIVER
19. 1 Any waiver at any time by either party of its rights with
respect to a default under this Agreement, or with respect to any other matters
arising in connection with this Agreement, shall not be deemed a waiver with
respect to any subsequent defau1 t or other matter.
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ARTICLE XX: CHOICE OF LAWS
This Agreement shall be construed and interpreted in accordance with
the 1 aws of the State of Idaho.
ARTICLE XXI: DISPUTES. DEFAULT. NOTICE AND LIQUIDATED DAMAGES
2l.l Disputes - All disputes related to or arising under this Agree-
ment, including, but not limited to, the interpretation of the terms and
conditions of this Agreement. will be submitted to the Commission for
resolution.
2l.2 Notice - In the event either party defaults in the performance
of any of the terms or conditions of this Agreement. the nondefaulting party
shall cause notice in writing to be given to the defaulting party, specifying
the manner in which such default occurred. If the defaulting party shall fail
to cure such default within the 60 days after service of such notice, then, and
only then, may the nondefaulting party pursue an action to terminate this
Agreement, to enforce the terms of this Agreement, or to recover damages for
breach thereof. This article shall not be construed as restricting in any way
Idaho Power' 5 rights under Articl e XII. or paragraph A-4. 1 of Appendix A to
immediately interrupt flows of energy from the facility to Idaho Power's
system.
21. 3 Li qui dated Damages - The parties agree that the amount of the
payment which Idaho Power is to make to Seller is based on the agreed value to
Idaho Power of Seller's performance of its obligation to provide Net Firm
Energy as set out in Article VI for the full term of the Agreement. The Net
Firm Energy amount in Article VI and the resulting Appendix D lump sum
repayment amount may be adjusted from time to time based on the actual
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performance of the Facility. The parties further agree that if Idaho Power
does not receive such full performance (l) Idaho Power shall be deemed damaged
by reason thereof, (2) it would be impractical or extremely difficult to fix
the actual damages to Idaho Power resul ti ng therefrom, (3) the payments as
provided below are in the nature of adjustments in Net Firm Energy prices and
1 i qui dated damages and not a penalty, and are a reasonable attempt by the
parties to estimate a fair compensation to Idaho Power for the reasonable
losses that would result from such total or partial default.
21.3.l Failure to Deliver for Term of Agreement - If, at any
time prior to the end of the term of the Agreement, Seller permanently
curtails in whole or in part its long-term average deliveries of the Net
Fi rm Energy amount speci fi ed in paragraph 6.3, Sell er shall pay to Idaho
Power, as damages arising out of this permanent curtailment of Net Firm
Energy deli veri es, the appropri ate lump sum repayment amount sped fi ed in
Appendix D, multiplied by the difference in megawatt-hours between the
annua 1 Net Fi rm Energy amount specifi ed in paragraph 6.3 and the reduced
annual Net Firm Energy amount after the permanent curtailment. This
payment amount will bear interest from sixty (60) days after Idaho Power
gives or receives notice of Seller's permanent reduction of the annual Net
Firm Energy amount, until paid; at a rate equal to interest rates
specified in Idaho Code §28-22-104 (or its successor Idaho Code provision)
in effect duri ng each month of that peri od. For purposes of thi s
paragraph, reduced deliveries of Net Firm Energy due to short-term below-
normal water conditions (paragraph 6.4) shall not be considered a
permanent curtai lment.
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2l. 3. 2 Securi ty for Repayment Obl i gati on - Ouri ng the full term
of this Agreement, Seller will provide Idaho Power with adequate assurance
that Se 11 er wi 11 be ab 1 e to repay the amounts owi ng Idaho Power under
Article XXI if Seller were to default pursuant to paragraph 2l.3.1. In
accordance with Commission Order Nos 21690 and 2l800, and subject to the
provi s ions of paragraph 21. 2 above, thi s assurance wi 11 be provi ded as
foll ows:
2l.3.2.l Seller shall comply with the provisions of
paragraph 14.2. If Seller fails to comply, such failure will be an
event of default under Article XXI.
(a) In the case of the liability insurance coverage,
(paragraph l4.2.l), a default may only be cured by Seller supplying
evidence that the liability insurance coverage has been replaced or
rei nstated.
(b) In the case of Low Water insurance coverage, (para-
graph l4.2.5) if Seller, after the exercise of due diligence, is
unab 1 e to secure low water insurance coverage whi ch comp 1 i es wi th
Paragraph l4. 2. 5, or if the cost of insurance coverage which complies
with Paragraph l4.2.5 exceeds 2.5% of the Faci1ity's projected annual
average revenue, then the failure to provide low water insurance
shall not be deemed an event of default if Seller provides the
fo 11 owi ng securi ty in lieu of low water insurance until conformi ng
low water insurance is available at a price that does not exceed the
percentage amount speci fi ed above.
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(c) In lieu security:--
Because the Faci 1 ity is located on the canal system of the
Northside Canal Company and therefore receives the benefits of the
Northside Canal Company. s senior water rights and upstream storage.
Idaho Power is wi 11 i ng to permi t Sell er to estab 1 ish a Debt Servi ce
Reserve Account unti 1 conformi ng low water insurance becomes avai 1-
able. Said Debt Service Reserve Account will be separate from the
maintenance escrow account and shall be structured as follows:
(l) The escrow instructions between the Sell er and
the Escrow Manager wi 11 prov i de that the funds in the Debt
Service Reserve Account will be prudently invested and that all
costs of setting up and operating the Debt Servi ce Reserve
Account. shall be paid by the Seller. At the end of the term of
this Agreement. or at the end of Seller1s obligation to maintain
an escrow account in 1 i en of purchas i ng low water insurance. any
ba 1 ance rema i ni ng in the Debt Servi ce Reserve Account shall be
released to Seller.
(2) Withi n 60 days after commencement of a Contract
Year in which Seller is entitled to provide security in-lieu of
conformi ng low water insurance coverage. Seller wi 11 depos i t
cash in the Debt Service Res~rve Account in an amount equal to
2 l/2% of the Facility.s estimated gross income for that
Contract Year. Said requirement to deposit 2 l/2% of estimated
gross income for each Contract Year shall cease when the Debt
Servi ce Reserve Account is funded in an amount equal to three
months. debt service on the project. or $250.000. whichever is
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higher. All interest earned on the funds on deposit shall be
retai ned in the Debt Servi ce Reserve Account. The requi rement
that interest earned on funds on depos i tin the Debt Servi ce
Reserve Account be retai ned in that account shall cease once the
Debt Servi ce Reserve Account is fully funded as provi ded above.
(3) The Escrow Manager wi 11 be instructed to only
re 1 ease funds from the Debt Servi ce Reserve Account to the
holder of the debt on the Facility. Funds from said account
shall be released only when, and only to the extent that Seller
cert i fi es to the Escrow Manager that the Faci 1 i ty i S revenues are
insufficient to satisfy Seller's costs of operating the Facility
and as a resul t, remai ni ng funds are not suffi ci ent to make debt
service payments on the Facility. For purposes of the Debt
Servi ce Reserve Account, costs for operati ng the Faci 1 ity shall
be 1 imited to those costs necessary for the operation of the
Facility such as taxes, insurance expenses, and other ordinary
and necessary operati ng expenses. Costs for operati ng the
Facility shall not include any disbursements which would con-
stitute a profit or return on investment.
(4) When conforming low water insurance has been
purchased, Sell er wi 11 no longer be requi red to fund or ma i nta in
sa i d Debt Servi ce Reserve Account.
ed) Failure to provide conforming low water insurance or
to maintain the Debt Service Reserve Account described above, will be
a default which can be cured by reinstatement of the insurance or the
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Power iS 1 i en ri ghts descri bed in paragraph 4. l. 8 of the Agreement and
Commission Order No 2l690. If at any time, Seller fails to comply
with those requirements, in addition to any other remedies available
under thi s Agreement, Commi ss i on Order No 2l690, and the 1 i en ri ghts,
Se 11 er wi 11 be requi red by Idaho Power to post 1 i qui d securi ty in
accordance wi th paragraph 21. 4 in an amount .equa 1 to 35% of the
accumulated overpayment liability specified for that year in
Appendix D. Seller recognizes that in accordance with Commission
Order No 2l690, a default under either or both of paragraphs 2l.3.2.2
or 21.3.2.3 constitutes a default under paragraph 21.3.2.4 and in
that event the ob 1 i gat i on to post 1 i qui d securi ty under para-
graphs 2l.3.2.2 through 2l.3.2.4 is cumulative.
21.3.2.5 During the full term of this Agreement, Seller
shall maintain compliance with all permits and licenses described in
paragraph 4.1.l of the Agreement. In addition, Seller will supply
Idaho Power with copies of any new or additional permits or 1 icenses
Se 11 er is requi red to obtai n duri ng the term of thi s Agreement
including, but not limited to, the Permit to Appropriate Water within
a reasonable time after their issuance. At least every fifth
Contract 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 1 icenses described in paragraph 4.1. 1 or to
maintain its water rights, or to provide the documentation required
by this paragraph, such failure will be a default under Article XXI.
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(a) In the case of non-compl iance with the required
governmental permits, the default may onlX be cured by Seller sub"
mitting to Idaho Power evidence of compliance from the permitting
agency.
(b) In the case of non-compliance with Seller1s obligation
to secure and maintain adequate water rights, default may be cured by
Seller reacquiring the required water rights or by posting liquid
security in accordance wi th paragraph 21. 4 in an amount equal to
26.39% of the accumulated overpayment liability specified for that
year in Appendix D.
21.4 Liquid Securitx - If, pursuant to this Agreement or Commission
Order No 21690, Sell er becomes ob 1 i gated to post 1 i qui d securi ty, such ob 1 i ga-
tion may be satisfied by Seller1s depositing cash or a cash equivalent
acceptab 1 e to Idaho Power, in an escrow to be held and managed by a bank or
savings & loan association located and in good standing in the State of Idaho.
The escrow holder and the escrow instructions will be acceptable to both Idaho
Power and Seller. Payment of all taxes on the amounts deposited in the escrow
wi 11 be the ob 1 i gat i on of the Sell er. The 1 i qui d securi ty escrow account wi 11
be maintained separately from the maintenance reserve account described in
paragraph 4.1.7. Failure to maintain and provide the liquid security required
by this Agreement and Commission Order Nos 21690 and 21800 shall be a default
under Art i cl e XXI.
ARTICLE XXII: GOVERNMENTAL AUTHORIZATION
Th is Agreement is subj ect to the juri sdi ct i on of those governmenta 1
agencies having control over either party or this Agreement.
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ARTICLE XXIII: COMMISSION ORDER
This Agreement shall not become effective until the Commission
approves all terms and provi s ions hereof wi thout change or condition and
declares that all payments to be made hereunder shall be allowed as prudently
incurred expenses for ratemaki ng purposes.
ARTICLE XXIV: SUCCESSORS AND ASSIGNS
This Agreement 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 that no ass i gnment hereof by Sell er shall become
effective without the written consent of Idaho Power being first obtained. Such
consent shall not be unreasonably withheld. This article shall not prevent a
financing entity with recorded or secured rights from exercising all rights and
remedies available to it under law or contract. Idaho Power shall have the
right to be notified by the financing entity that it is exercising such rights
or remedies.
ARTICLE XXV: MODIFICATION
No modification to this Agreement shall be valid unless it is in
writing and signed by both parties.
ARTICLE XXVI: TAXES
26. 1 Each party agrees to pay its own federal and state taxes on its
share of income attributable to the parties. performance of this Agreement, and
any other tax, including any tax in the nature of an excise tax.
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26.2 Each party shall pay before delinquency all ad valorem taxes and
other governmental charges which if failed to be paid when due could result in
a lien upon the Facility or the Interconnection Facilities.
26.3 The Tax Reform Act of 1986 (Act) specified that Contributions in
Aid of Construction (CIAC) received from customers are taxable income to the
ut i 1 ity. The Act di d not, however, specify the defi ni t i on of a customer.
Accordingly, it is uncertain whether the amounts to be paid by Seller under
Appendix B would bè considered CIAC and therefore taxable to Idaho Power.
Idaho Power will treat the Appendix B amounts received from Seller as a non-
taxable contribution received from a supplier, not a customer, and will defend
this position with the Internal Revenue Service (IRS) should this item be
contested. However, should any amount received from Seller ultimately be
deemed by the IRS to be taxable income to Idaho Power, Seller shall pay Idaho
Power the amount which will fully satisfy Idaho Power's income tax liability
for those amounts cal cu 1 ated us i ng the II net present value methodll specifi ed in
IPUC Order No 2l933, plus any interest, pènalties and/or additional taxes
resul ti ng from such determi nation by the IRS.
ARTICLE XXVII: NOTICES
All written notices under this Agreement shall be directed as
fo 11 ows , and shall be cons i dered deli vered when depos i ted in the U S Mail,
first-class postage prepaid, as follows:
To Seller:Bypass Limited
c/o S i the Energi es, USA
885 Thi rd Avenue, Suite 3040
New York, NY L0002
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To Idaho Power Sr Vice President, Power Supply
Idaho Power Company
POBox 70
l220 Idaho Street
Boi se, Idaho 83707-0070
ARTICLE XXVIII: ADDITIONAL TERMS AND CONDITIONS
This Agreement includes the following appendices, which are attached
hereto and i ncl uded by reference:
Appendix A Standards for Interconnecti on and
Metering
Special Facilities, Point of Delivery
and Meteri ng, and Operati on Date
Schedule of Required Licenses and Permits
Lump Sum Refund Payment
Operati ng Instructions
Statements of Professional Engineer
Appendix B
Appendix C
Appendix D
Appendix E
Appendix F
ARTICLE XXIX - ENTIRE AGREEMENT
This Agreement constitutes the entire Agreement of the parties con-
cerni ng the subject matter hereof and supersedes all pri or or contemporaneous
oral or written agreements between the parties concerning the subject matter
hereof.
IN WITNESS WHEREOF, The parties hereto have caused thi s Agreement to
be executed i names on the dates set forth below:
IDAHO POWER COMPANY
Æ.' AdBy t., -¡ (/.,~
C E Bissell, Sr Vice President
Power Supply
Dated:Dated Ij/f/i1-
"Seer"II Idaho Powerll
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( PAGE 42 is A BLA PAGE J
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STATE OF IDAHO )
) ssCounty of Ada )
On this ~ day of , 1988, before me, the
undersigned, a Notary Public, E BISSELL, personally
known, who being duly sworn, did ay tha he is the Sr Vice President - Power
Supply of the corporation that executed the within instrument, and acknowledged
to me that such corporation executed the same as the free act and deed of said
corporat ion.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal, the day and year in this certificate first above written.
(NOtARIAL SEAL)IaL~~&õtry Pub 1 i c foe dah~
Residing at Boise, Idaho
STATE OF )
) ss
)County of
On thi s day of , 1988, before me, the
undersigned, a Notary Public, personally appeared William Kriegel, personally
known, who being duly sworn, did say that he is the General Partner of the
limited partnership that executed the within instrument, and acknowledged to me
that he executed the same as the free act and deed.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal, the day and year in this certificate first above written.
(NOTARIAL SEAL)
MARIANNE FELDT
Notary Public, State of NlI Vt/tf
No. 60-4ß34130
I Ouamied in O:ang(1 COt(:'ty,
Certificate f''Jd in NGW Y:ik countyq,
CominisSoloi1 Expires Nov"mber 30, 111'ilO
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APPENDIX A
STANDARDS FOR INTERCONNECTION AND METERING
A- 1 GENERAL PROVISIONS
A-l.l It is the policy of Idaho Power to permit Seller to operate its Facility
in para 11 e 1 wi th Idaho Power iS e 1 ectri c system, whenever thi s can be done
without adverse effect to Idaho Power i s equipment, personnel or other
customers.
A- 1.2 These gui de lines contai n the mi nimum meteri ng, interconnection, protec-
tion, operation, and communications requirements for the safe and effective
parallel operation of Seller1s Facility with Idaho Power1s system. Although
these guidelines are established to provide a uniform approach for evaluating
Se 11 erl s gene rat i on projects, each interconnection must be exami ned by Idaho
Power individually. Idaho Power and the Seller will be guided by this
document, which is a part of the Firm Energy Sales Agreement, in planning an
interconnection between Idaho Power1s system and the Seller.
A-1.3 Idaho Power may provide limited technical assistance for Seller, but
will not perform any engineering, construction or repair work on power pro-
ducti on equipment.
A-2 GENERAL DESIGN CONSIDERATIONS
A-2.1 All Seller generators larger than 20 KVA shall be three-phase generators
connected to three-phase ci rcuits unless otherwi se approved by Idaho Power.
Generators 20 KVA and smaller may be either three-phase or single-phase,
depending on system considerations.
Due to physical limitations within Idaho Power1s transmission and
distribution systems, induction machine sizes will be limited to confine
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voltage flicker within acceptable limits. Each generation site is unique and
Idaho Power wi 11 determi ne the appropri ateness of any proposed machi ne type for
the site and i nterconnecti on.
A-2.2 Except in certai n instances to be determi ned by Idaho Power, Se 11 er IS
generator(s) shall be isolated from Idaho Power1s system by a transformer.
Transformer type and connection will be specified by Idaho Power. The Seller
may be required to 1 imit the fault current contribution to Idaho Power i s system
by generator impedence, neutral grounding or other means.
A-2.3 Idaho Power will not assume any responsibility for protection of the
Seller1s generator or of any other portion of the Seller1s electrical
equipment. The Seller is fully responsible for protecting his equipment from
faults or disturbances on Idaho Power1s system.
A-2.4 Seller is hereby notified that certain conditions on Idaho Power1s
system may cause negative sequence currents to flow in the Sellerl s generator.
It is the sole responsibility of the Seller to protect his equipment from
excessive negative sequence currents, reverse power flow, and single phasing.
A- 3 METERING AND TELEMETRY REQUIREMENTS
A-3.1 Unless otherwise agreed by the Parties, metering will be provided for
recordi ng net output of the Faci 1 ity and wi 11 be separate from any meteri ng of
Sellerl s load. Metering required will be determined by Idaho Power on a
case-by-case bas is, but wi 11 generally follow the gui del i nes below:
A-3.1.i Capacity Under 750 KW - Two kilowatt-hour/demand meters; one measuring
power flow into customer1s facilities and one measuring power flow into Idaho
Powerl s system.
A-3.1.2 Capacity of 750 KW to 4999 KW - A bi-directional, electronic meter
installation with load profiling and communication port capability will be
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Un 1 ess otherwi se approved by Idaho Power, synchronous generators shall
be equipped with an excitation system and voltage regulator that are capable of
automatically controlling generator voltage over the full range of generator
power and reactive capability. In some cases, depending upon system require-
ments, one or more of the fo 11 owi ng control methods may be requi red, as
specified in Appendix B:
1) a power factor regulator may be required as well as a voltage
regulator.
2) a programmable controller capable of varying the reactive output
based upon a preset time schedule.
3) a remote signal provided by Idaho Power to adjust the voltage or
power factor regulator settings. Idaho Power will provide this
remote signal from within Idaho Power i s system and transmit the
signal to the Facility at the Seller1s expense, as specified in B-ll
of Appendix B.
The generator excitation system shall have over and under excitation
limiter equipment which will permit voltage regulator action to control the
react i ve output wi th in the range of the generator i s capab i 1 i ty.
The reactive capability of the Facility shall be operated as specified
by Idaho Power, within the generator reactive capability, to regulate either
the interconnection voltage or Facility output power factor or both. Idaho
Power will provide the desired voltage, power factors, and schedules required
by the Sell er to set voltage regul ators, power factor regul ators and programmed
or remote signal controllers. Idaho Power may change these desired values from
time to time as system requirements change.
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If the Facility is not operated to control reactive output in the manner
specified and after notification, the Seller does not make necessary correc-
tions within a reasonable time, a default will be declared pursuant to Article
XXI.
A-S.4 Due to the ability of large synchronous generators to influence Idaho
Power1s system, protective and control relaying in addition to the usual
voltage frequency, and fault relaying will be specified by Idaho Power. This
wi 11 cons i st of generator re 1 ayi ng for phase to phase and three phase faul t
detection. Idaho Power will specify the relay type and determine settings.
This relay will be tested annually by Idaho Power and the actual cost of this
testing will be paid by the Seller.
A-6 INDUCTION GENERATORS
A-6. i Overvo 1 tage can become a seri ous prob 1 em when an induction generator is
isolated to a portion of a transmission or distribution system. Overvolta.ge
re 1 ayi ng shall be provi ded that wi 11 open the generator breaker in the event
that the voltage reaches predetermined limits consistent with the overvoltage
capabi 1 i ty of the generator and the system. Undervo 1 tage protection may al so
be required. On larger units, underfrequency and overfrequency relaying may be
requi red.
A-6.2 Induction generators require supplemental reactive support. The total
reactive required is that amount required to correct the Facility to unity
power factor. The reactive may come from either Idaho Powerl s system or from
capacitive correction at the Facility or both. Idaho Power will charge the
Seller (as specified in Appendix B) for reactive that is provided from the
system.
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At some Facilities, because of system considerations, it may not be
practical to provide all of the reactive compensation at the Facility. In
these instances, Idaho Power shall speci fy the power factor and compensation
necessary at the Faci 1 i ty.
The Seller will have the option to furnish the reactive compensation
that is required at the Facility. If the Seller furnishes the reactive compen-
sation, the Facility must be operated at a power factor that is within 5
percent of the specified power factor. The Seller must also design the
Facility to avoid possible over-voltage that can occur under certain conditions
when capacitors are applied to the generator terminals.
A-7 DC TO AC CONVERTERS
A-7. 1 Oi rect current generators may be operated in para 11 e 1 wi th Idaho Power l s
system through a synchronous . inverter. The inverter i nsta 11 at i on wi 11 be
designed such that an Idaho Power system interruption will result in the
immediate removal of the inverter power flow to Idaho Power. Harmonics and/or
spurious frequencies generated by the Se11erl s generator-inverter combinations
must be limited to avoid causing any reduction in quality of electric service
to Idaho Powerl s other customers.
A-8 SWITCHING REQUIREMENTS
A-8. i Idaho Power reserves the ri ght to open and secure by lock any di scon-
nect i ng devi ce wi thout pri or not ice to Seller for any of the fo 11 owi ng reasons:
A-8. l. 1 System emergency.
A-8.L.2 Inspection of the Seller's Facility protective equipment reveals a
condition which might adversely impact Idaho Power or Idaho Power's other
customers.
-49-
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A-8.l.3 Seller's generating equipment interferes with other customers, or with
Idaho Power's system.
A-8.2 Seller shall maintain a written record of all operating (opening and
closing) by Seller of the Seller's interconnection with Idaho Power. Each
operati on wi 11 be recorded by the date, hour and mi nute and wi 11 i ncl ude the
generator kilowatt hour reading at the time of the operation. This record will
be maintained on a monthly basis and the original will be mailed to Idaho Power
on the first business day of the following month. Idaho Power will provide the
forms necessary for fi 1 i ng thi s monthly swi tchi ng report.
A-9 GENERATION SCHEDULING AND REPORTING
A-9.l For installations under 750 KVAt the Seller shall read his generator
kilowatt hour/demand meter within the 24-hour period following l2:00 noon on
the last day of each month. That kilowatt hour meter reading is to be recorded
on the Monthly Power Production Switching Report.
A-9.2 For installations 750 KVA and abovet see Appendix E.
A-9.3 The written record of the end-of-month meter reading on the Monthly
Power Production Switching Reportt subject to subsequent review and correction
by Idaho Power t wi 11 be the bas is of payment for energy purchased by Idaho
Power from the Seller. An adjustment in the kilowatt hours delivered will be
made to compensate for the losses in B-6.
A-9.4 At the end of each montht the Monthly Power Production Switching Report
will be mail ed to:
Operations and Joint Facilities Accounting
Idaho Power Company
POBox 70
Boi se, Idaho 83707-0070
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APPENDIX B
SPECIAL FACILITIES, POINT OF DELIVERY AND METERING,
AND OPERATION DATE
PROJECT NO 3l715l28
HAZELTON A
B-l DESCRIPTION OF FACILITY
The Seller1s Facility is described as three generators with nameplate
rat i ngs of 3300 KW each at 4160 Vo 1 ts, three phase, 60 hertz, dri ven by
Kaplan S-Type Turbines.
B-2 LOCATION OF FACILITY
The Facility is located in the NE Quarter of Section 2, Township LO South,
Range 20 East, Boise Meridian, Jerome County, Idaho.
B-3 SCHEDULED OPERATION DATE
Seller has selected June l, 1990, as the Scheduled Operation Date and
May l, 1990, as the First Energy Date. In making these selections, Seller
recognizes that to allow for adequate testing of the Faci 1 ity. s degree of
completion and reliability, it must achieve its First Energy Date at least
thirty (30) days prior to the Operation Date. Idaho Power, based on the
information supplied by Seller, will schedule its construction so that all
Special Facilities, Disconnection Equipment and metering equipment will be
completed in time so as not to delay Seller's achieving the First Energy
Date. However, if Seller fails to pay the costs specified in B-ll below
at the time specified therein, or materially changes the specifications or
design of the Facility or Seller-furnished Interconnection Facilities from
what was previ ous ly provi ded to Idaho Power, Idaho Power may be requi red
-51-
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to reschedule its construction of these facilities which could adversely
impact Se11er1s ability to achieve its scheduled First Energy Date.
8-4 FAILURE TO ACHIEVE OPERATION DATE
If Seller has not achieved the Operation Date within eleven eii) months of
the Scheduled Operation Date, such failure shall be deemed to be an event
of default pursuant to Article XXI.
B-5 POINT OF DELIVERY
The Poi nt of Deli very of Energy from the Sell er to Idaho Power wi 11 be the
L38,OOO volt bushings of the transformer bank. The ll,OOO KVA transformer
bank will be a three phase bank, 4160 volts to L38,OOO volts, and will be
owned and maintained by the Seller. The transformer connection will be
specified by Idaho Power at a later date.
8-6 LOSSES
Losses shall be 2.00% of the metered energy.
B-7 METERING AND TELEMETRY
The metering equipment will be on the 4160 volt side of the transformer
bank, and will consist of potential and current transformers, an
electronic bi-directiona1 demand meter, and an electro-mechanical backup
meter. The meter i nsta 11 at i on wi 11 have load profi 1 i ng and communi cat ion
port capability and will be connected to the project voice communications
circuit. The telemetry equipment will include all necessary telemetry and
communication equipment and a dedicated voice quality unconditioned data
line which will be installed to provide continuous instantaneous te1e-
metering of net generation to Idaho Power's Designated Dispatch Facility.
Metering and telemetry equipment will be owned and maintained by Idaho
Power, with total cost of purchase, installation, operation and
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maintenance, including communications line lease cost to be reimbursed to
Idaho Power by the Seller.
B-8 SPECIAL FACILITIES
The construction of ll,800 feet of l38,000 volt H-frame transmission line
us i ng a 750 foot ru1 i ng span, inc 1 udi ng two deadend structures and
following a straight line, and the installation of two l38,000 volt
sectiona1izing switches will be provided by Idaho Power as Special
Facilities. The total cost for these Special Facilities will be
reimbursed to Idaho Power by the Seller. The Seller will provide all
needed ri ght of way.
B-9 REACTIVE POWER
The Seller shall operate the synchronous generators wi thi n plus or mi nus
5% of unity power factor unless Idaho Power specifies other operating
gui de 1 i nes.
B-lO DISCONNECTION EQUIPMENT
Disconnection Equipment is required to insure that the Seller's Facility
wi 11 be di sconnected from Idaho Power's system in the event of a di sturb-
ance on either Idaho Power's system or the Seller's Facility. This
equipment is for the protection of Idaho Power's equipment only and wi 11
be located at the Poi nt of Del ivery. Idaho Power wi 11 supply a three
phase gang operated 138,000 volt disconnect switch for mounting on the
deadend structure, a l38,000 volt potential transformer, a 138,000 volt
circuit switcher, a current transformer to be installed in the transformer
neutral, a relay cabinet containing relays and associated wiring and
logic, and a battery cabinet. Seller will install all Idaho Power
supp1 ied equipment, and all wiring and conduit necessary for the operation
-53-
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of the interconnection equipment. Idaho Power will supply details for the
interconnection panel and will connect and test the equipment prior to
operation of the facility. Seller will provide drawings of the inter-
connection wiring for engineering approval before installation. The total
cost of the interconnection equipment, connection and testing will be
reimbursed to Idaho Power by the Seller.
B-ll COSTS
The total cost of transmission Special Facilities is $224,l82. The total
cost of the Metering Equipment is $7,050. The total cost of the telemetry
equipment is $5,555. In addition, there will be a monthly charge for the
communication circuit lease cost associated with the telemetry equipment.
The communications circuit lease is $l40 per month as of the date of this
Agreement. Seller recognizes that the monthly communications circuit
charge may be adjusted by Idaho Power as the cost to Idaho Power is
adjusted by the owner of the communications circuit. The total cost of
the Disconnecting Equipment is $8l,644. The total cost to be paid by the
Seller is $3l8,431. This represents the amount that will be charged by
Idaho Power if the Seller makes the payment on or before January 27, 1989.
Idaho Power will not schedule construction or order Special Facilities
which are not ordinarily maintained in Idaho Power1s inventory until
payment has been made. In addition to the installation and construction
charges above, duri ng the term of the Agreement, Seller will pay Idaho
Power an operation and maintenance charge of 0.36% per month on the
transmission Special Facilities, and 0.7% per month for the remainder of
the Facilities specified above. The monthly operations and maintenance
charges may be adjusted duri ng the term of the Agreement to refl ect
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changes in the costs upon whi ch the charges is based. Idaho Power wi 11
maintain on file with the Commission a schedule showing the cost
components and calculation of the monthly operation and maintenance
charges.
B-l2 SALVAGE
No later than sixty (60) days after the termination or expiration of this
Agreement, Idaho Power will prepare and forward to Seller an estimate of
the remaining value of those Idaho Power furnished Interconnection
Facilities described in this Appendix, less the cost of removal and
transfer to Idaho Power i s nearest warehouse, if the Interconnection
Facilities will be removed. Idaho Power may then be invoiced by Seller
for the net salvage value estimated by Idaho Power for the interconnection
facilities and shall pay such amount to Seller within thirty (30) days
after receipt of said invoice. Seller shall have the right to offset the
i nvoi ce amount agai nst any present or future payments due Idaho Power.
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APPENDIX C
SCHEDULE OF REQUIRED LICENSES AND PERMITS
l. Evidence of compl iance with Part 1 of the Federal Power Act. Acceptable
evi dence of comp 1 i ance wi" be an Order from FERC: (l) i ssui ng a val i d
License for the Facility, or (2) validly exempting the Facility from
Licensing.
2. Approved App 1 i cat i on for Permi t to appropri ate water for power production
purposes issued by the Idaho Power Department of Water Resources.
3. Evidence of compliance with Subpart B of CFR §292.207.
-56-
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APPENDIX D
LUMP SUM REFUND PAYMENT FOR PERMANENT CURTAILMENT
OF PORTION OR ALL OF ANNUAL NET ENERGY AMOUNT
UNDER 20-YEAR CONTRACT
Contract Year
of Curtail ment
Commencement
1
2
3
4
5
6
7
8
9
LOII
l2
l3
l4
l5
l6
l7
l8
19
20
Do 11 ars Per Annual
Megawatt Hour
1990 Operati on Date
22
47
73
LOLl3l
l64
199
200
199
197
192
l85
175
l62
l46
l26
l02
74
40
o
-57-
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APPENDIX E
OPERATING INSTRUCTIONS FOR PLANTS OVER 750 KW
1. Prior to initial start~up at least ~ day .i advance the Project shall:
A. Provide Idaho Power's system dispatching facility with an estimate of
the hourly generation that is expected to be produced during the
first scheduled test day. The phone number for System Scheduling to
report the estimate is 1 i sted below.
B. Notify the Division Substation Supervisor of project start up plans.
The phone number is 1 i sted below.
C. The kWh meter should be read and entered on the Monthly Power Pro~
duction and Switching Report (Form No: Cogen CAD~A~l).
2. Before lO:OO Am on each normal work daYt after the initial start~uPt the
Project will report to the System Scheduling Office the previous day1s
actual generation based upon midnight to midnight meter readings and the
esti mate of generation planned for the fo 11 owi ng day or days. The phone
number to report the actual generation and schedul i ng estimate is 1i sted
below. Note that the System Scheduling number is answered only between
the hours of 8 AM to 5 PM Mountain Timet on weekdays and that generation
estimates must be provided for weekend days and hol idays.
3. Each time the generator breaker is closed or opened (including testing andnormal operationL Idaho Power's System Dispatchers must be notified by
phone as soon as possible. Prompt reporting is very important. The
System Di spatch Center is manned 24 hours a day, 7 days a week, and the
phone number is 1 i sted below.
4. In addition to promptly notifying the System Dispatchers, the record of
each breaker opening and closing must be entered on the Monthly Power
Production and Switching Report mentioned in L~C above.
5. For questions or problem concerning:
Power Schedul i ng:
System Dispatching:
(208) 383~2863
(208) 383~2826
Meteri ng:Meter Engi neer ~ Boi se
(208) 383~275l
or
~58-
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Division Metering Supervisor
Payette
Boise
Twin Falls
Pocatello
(208) 642-337l, ext 284
(208) 322- 2029
[phone], ext 284
[phone], ext 777l
Substations: Division Substation Supervisor
Payette
Boise
Twi n Fall s
Pocatello
(208) 642-337l, ext 262
(208) 322- 2064
[phone], ext 237
[phone], ext 7774
Bi 11 i ng:Power Accounti ng - Boi se
[phone]
Contracts:Customer Generation - Boi se
[phone]
6. Toll free numbers for Operating Reporting:
In-State: System Scheduling
System Di spatchi ng
Out-of-State: System Schedul ing
System Di spatchi ng
1 -800-635-l093
1 -800-635-7348
1 -800- 356-4328
1 -800- 348-4328
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"\
APPENDIX F
CERTIFICATION OF DESIGN ENGINEER
The undersigned , on behalf of
himself and hereinafter collectively
referred to as II Des i gn Engi neerll, hereby states and cert i fi es to Idaho Power as
follows:
l. That Design Engineer is a Licensed Professional Engineer in good
standing in the State of Idaho.
2. That Design Engineer has reviewed the Firm Energy Sales Agree-
ment, hereinafter "Agreementll, between Idaho Power as Buyer, and
as Seller, dated
3. That the cogeneration or small power production project which is
the subject of the Agreement and this Statement is identified as IPCo Facility
No and is further designated as Federal Energy Regulatory
Commi ss i on Hydro Project No and is herei nafter referred to as the
IIprojectl.
4.That the Project, which is commonly known as the
Project, is located in Section
, Range , Boi se Meri di an, County,Township
Idaho.
5. That Design Engineer recognizes that the Agreement provides for
the Project to furnish electrical energy to Idaho Power for a
( ) year period.
-60-
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6. That Design Engineer has substantial experience in the design,
construction and operation of electric power plants of the same type as this
project.
7. That Des i gn Engi neer has rev i ewed the engi neeri ng des i gn and
i
construction of the Project, including the civil work, electrical work, gen-
erating equipment, water conveying equipment, Seller furnished interconnection
equipment and other project facilities and equipment.
8. That the Project has been constructed in accordance with said
plans and specifications, all applicable codes and consistent with Prudent
Electrical Practices as that term is described in the Agreement.
9. That the design and construction of the Project is such that
with reasonab 1 e and prudent ope rat i on and maintenance practices by Seller, the
Project is capable of performing in accordance with the terms of the Agreement
and with Prudent Electrical Practices during the full term of the Agreement.
LO. That Design Engineer has suppl ied the Seller with at least one
copy of said Plans and Specifications bearing his Stamp and the words
lICERTIFIED FOR IDAHO P. U. C. SECURITY ACCEPTANCElI on each sheet thereof.
l1. That Design Engineer recognizes that Idaho Power, in accordance
with paragraph 5.2(2) of the Agreement, in interconnecting the Project with its
system, is relying on Engineer's representations and opinions contained in this
Statement.
-61-
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l2. That Design Engineer certifies that the above statements are
comp 1 ete, true and accurate to the best of hi s knowl edge and therefore sets hi s
hand and seal below.
By
(P. E. Stamp)
Date
STATE OF IDAHO )
) ssCounty of )
On this _ day of
undersigned, a Notary Public, personally appeared
personally known, who being duly sworn, did say that he is the individual who
, 19_, before me, the
executed the within instrument, and acknowledged to me that he executed the
same as a free act and deed.
IN WITNESS WHEREOF, I have hereunto set my hand and affi xed my
official seal, the day and year in this certificate first above written.
(NOTARIAL SEAL)Notary Pub 1 i c for Idaho
Residi ng at:
-62-
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APPENDIX F
ENGINEER1 S CERTIFICATION OF DESIGN &
CONSTRUCTION ADEQUACY
The unders i gned , on behalf of
himself and , hereinafter collectively
referred to as IIEngineerll,. hereby states and certifies to Idaho Power as
follows:
l. That Engi neer is aLi censed Profess i ona 1 Engi neer in good
standing in the State of Idaho.
2. That Engineer has reviewed the Firm Energy Sales Agreement,
herei nafter IIAgreementll, between Idaho Power as Buyer, and
as Se 11 er, dated
3. That the cogeneration or small power production project which is
the subject of the Agreement and this Statement is identified as IPCo Facility
No and is further designated as Federal Energy Regulatory
Commission Hydro Project No and is herei nafter referred to as the
IIProjectlI .
4. That the Project, which is commonly known as the
Project, is located inSect ion
Township , Range , Boi se Meri di an,County,
Idaho.
5. That Engi neer recogni zes that the Agreement provi des for the
Project to furnish electrical energy to Idaho Power for a ()
year peri od.
-63-
..
6. That Engineer has substantial experience in the design, con"
struction and operation of electric power plants of the same type as this
project.
7. That Engineer has no economic relationship to the Design
Engineer of this Project and has made the analysis of the Plans and Specifi-
cat ions independently.
8. That Engineer has reviewed the engineering design and con-
struction of the Project, including the civil work, electrical work, generating
equipment, water conveying equipment, Seller furnished interconnection equip-
ment and other project faci 1i ti es and equipment.
9. That the Project has been constructed in accordance with said
plans and sped fi cat ions, all app 1 i cab 1 e codes and cons i stent wi th Prudent
E1 ectri ca 1 Practices as that term is descri bed in the Agreement.
10. That the design and construction of the Project is such that
wi th reasonab 1 e and prudent ope rat i on and maintenance practices by Se 11 er, the
Project is capable of performing in accordance with the terms of the Agreement
and with Prudent Electrical Practices during the full term of the Agreement.
lL. That Engi neer recogni zes that Idaho Power, in accordance with
paragraph 5.2(2) of the Agreement, in interconnecting the Project with its
system, is relying on Engineer1s representations and opinions contained in this
Statement.
-64-
..
12. That Engineer certifies that the above statements are complete,
true and accurate to the best of hi s knowl edge and therefore sets hi s hand and
seal below.
By
(P. E. Stamp)
Date
STATE OF IDAHO )
) ssCounty of )
On thi s __ day of
undersigned, a Notary Public, personally appeared
personally known, who being duly sworn, did say that he is the individual who
, 19_, before me, the
executed the within instrument, and acknowledged to me that he executed the
same as a free act and deed.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal, the day and year in this certificate first above written.
(NOTARIAL SEAL)Notary Publ ic for Idaho
Res i di ng at:
-65-
..
APPENDIX F
ENGINEER'S CERTIFICATION OF
OPERATIONS & MAINTENANCE POLICY
The unders i gned
himself and
, on behal f of
, hereinafter collectively
referred to as II Engi neerll, hereby states and cert ifi es to Idaho Power as
follows:
l. That Engi neer is ali censed Profess i ona 1 Engi neer in good
standing in the State of Idaho.
2. That Engineer has reviewed the Firm Energy Sales Agreement,
herei nafter II Agreementll, between Idaho Power as Buyer, and
as Seller, dated
3. That the cogeneration or small power production project which is
the subject of the Agreement and this Statement is identified as IPCo Facility
No and is further designated as Federal Energy Regulatory
Commission Hydro Project No and is hereinafter referred to as the"
IIProjectlI .
4. That the Project, which is commonly known as the
Project, is located in Section
Township , Range , Boi se Meri di an,County,
Idaho.
5. That Engi neer recogni zes that the Agreement provi des for the
Project to furnish electrical energy to Idaho Power for a
year peri od.
()
-66-
..
6. That Engi neer has substantial experi ence in the des i gn, con-
struction and operation of electric power plants of the same type as this
project.
7. That Engineer has no economic relationship to the Design
Engi neer of thi s Project.
8. That Engineer has reviewed and/or supervised the review of the
Policy for Operation and Maintenance (O&M Policy) for this plant and it is his
professional opinion that, provided said plant has been designed and built to
appropriate standards, adherence to said O&M Policy will result in the plant1s
producing at or near the design electrical output, efficiency, and plant factor
for the (__) year peri od of the Agreement.
9. That Engi neer recogni zes that Idaho Power, in accordance wi th
paragraph 5.2(2) of the Agreement, is relying on Engineer's representations and
opi ni ons contai ned in thi s Statement.
LO. That Engi neer cert ifi es that the above statements are comp 1 ete,
true and accurate to the best of hi s knowl edge and therefore sets hi s hand and
sea 1 below.
By
(P. E. Stamp)
Date
-67-
..
STATE OF IDAHO )
) ssCounty of )
On thi s __ day of
undersigned, a Notary Publ ic, personally appeared
personally known, who being duly sworn, did say that he is the individual who
, 19_, before me, the
executed the within instrument, and acknowledged to me that he executed the
same as a free act and deed.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal, the day and year in this certificate first above written.
(NOTARIAL SEAL)Notary Pub 1 i c for Idaho
Residing at:
-68-
.-.
APPENDIX F
ENGINEER i S CERTIFICATION OF ONGOING
OPERATIONS AND MAINTENANCE
The unders i gned
himself and
, on behalf of
, hereinafter collectively
referred to as II Engi neerll, hereby states and cert i fi es to Idaho Power as
follows:
1. That Engi neer is aLi censed Profess i ona 1 Engi neer in good
standi ng in the State of Idaho.
2. That Engineer has reviewed the Firm Energy Sales Agreement,
hereinafter IIAgreementll, between Idaho Power as Buyer, and
as Seller, dated
3. That the cogeneration or small power production project which is
the subject of the Agreement and this Statement is identified as IPCo Facility
No and is further des i gnated as Federal Energy Regulatory
Commi ssion Hydro Project No and is herei nafter referred to as the
IIProjectlI .
4. That the Project, which is commonly known as the
Project, is located inSect ion
Township , Range , Boi se Meridi an,County,
Idaho.
5. That Engi neer recogni zes that the Agreement provi des for the
Project to furnish electrical energy to Idaho Power for a ()
year period.
-69-
..
6. That Engineer has substantial experience in the design, con"
struction and operation of electric power plants of the same type as this
project.
7. That Engineer has no economic relationship to the Design
Engi neer of thi s Project.
8. That Engineer has made a physical inspection of said plant, its
operations and maintenance records since the last previous certified inspec-
tion, and the plants O&M Policy bearing the words IICERTIFIED FOR IDAHO P.U.C.
SECURITY APPROVALII and the Stamp of the Cert i fyi ng Engi neer. It is Engi neer IS
professional opinion, based on the plantl s appearance, that its ongoing O&M has
been substantially in accordance wi th sai d O&M Pol icy; that it is in reasonably
good operating condition; and that if adherence to said O&M Policy continues,
the plant will continue producing at or near its design electrical output,
effi ci ency, and plant factor for the rema i ni ng years of the Agreement.
9. That Engi neer recogni zes that Idaho Power, in accordance wi th
paragraph 2l. 2. 2. 2 of the Agreement, is relying on Engi neer' s representations
and opinions contained in this Statement.
10. That Engineer certifies that the above statements are complete,
true and accurate to the best of his knowledge and therefore sets hi s hand and
sea 1 below.
By
(P. E. Stamp)
Date
-70-
~..
STATE OF IDAHO )
) ssCounty of )
On thi s day of , 19_, before me, the
unders i gned, a Notary Pub 1 ie, personally appeared
personally known, who being duly sworn, did say that he is the individual who
executed the within instrument, and acknowledged to me that he executed the
same as a free act and deed.
IN WITNESS WHEREOF, I have hereunto set my hand and affi xed my
official seal, the day and year in this certificate first above written.
(NOTARIAL SEAL)Notary Public for Idaho
Residing at:
~
-7l-
..
EXHIBIT B
SETTLEMENT AGREEMENT AND STIPULATION
..
SFr.p AGB AN STIPQTION
THIS AGREEMNT and stipulation is by and between Bypass
Limited, Sithe Energies USA, and the Nortside Canal Company
(hereinafter collectively referred to as .Complainants") and
Idaho Power Company (" Idaho Power").
W I '. II E S S B '. B:
WHRE, Complainants presently have pending before the
Idaho Pulic utilities Commission (the .Commission") three
complaints against Idaho Power. Those complaints are
identified as Case Nos. U-1006-300 (Hazelton A), U-1006-310
(Hazelton B) and U-1006-302 (Wilson Lake) J and
WHERE, the Commission has granted both Complainants'
Petition for Reconsideration and Idaho Power's Cross-Petition
for Reconsideration as to Order Nos. 21249, 21332, and 21630
issued in Case No. U-1500-170; and
WHEREAS, the parties desire to settle and resolve both
the Complaints and the Petitions for Reconsideration;
NOW, THEREFORE, in consideration of the foregoing, the
parties hereby stipulate and agree as follows:
1. All parties agree to waive their statutory rights
to have the Petitions for Reconsideration heard by the
Commission within thirteen (13) weeks after the date for
filing Petitions for Reconsideration (I.C. I 61-626(2)). The
parties further agree and stipulate that the Commission may
1
..
vacate the briefing .chedule and the hearin9 on reconsidera-
tion pre.ently .et for March 22, 1988, pending final
resolution of the settlement efforts between the parties.
2. Complainants hereby stipulate and agree to the
dismissal of Commission Case Nos. U-1006-300 (Hazelton A), u-
1006-301 (Hazelton B) and tJ-1006-302 (Wilson Lake) without
prejudice. Except as otherwise provided in paragraph 5,
complainants agree thàt in a subsequent complaint proceeding
(if any) relating to any of these three projects, neither
they, nor any of their representatives, successors or
assigns, will allege that any of the three Projects have any
right or entitlement to the cogeneration/small power
production purchase rates set by the Commission in Case
No. U-I006-248.
3. The parties agree to expeditiously negotiate and
submit to the Commission for approval, contracts for the
Hazelton A and B small hydro projects. These contracts will
include the interim purchase rates set by the Commission in
Order No. 21630 in Case No. U-1500-170.
4. 'l'he parties will also negotiate a contract for the
wilson Lake project but it will not be executed, nor will it
contain any purchase rates. When Complainants have provided
Idaho Power with all of the permits and other information
necessary for the execution of the Wilson Lake contract
including, but not limited to, a license or exemption from
licensing from the Federal Energy Regulatory Commission for
the wilson Lake Project, the contract will be finalized and
2
..
subitted to the Co_ission for approval. Unles8 another
rate i8 ordered by the Co_i8sion, the purchase rates to be
included in the Wilson Lake Contract will be the Commission
approved small power production purchase rates in effect at
the time the Wilson Lake Contract is executed.
5. Concurrent with the application to the Commission
for approval of the Hazelton A and Hazelton B contracts, both
parties will file motions withdrawing their respective
Petitions for Reconsideration in Case No. U-1500-170. The
Commission · s approval of the Hazel ton A and Hazel ton B
contracts as submitted and its granting of the Motions
withdrawing the Petitions for Reconsideration will be a
condition precedent to the effectiveness of the Hazelton A
and B contracts and will consti tute a full accord and
satisfaction of all outstanding issues between the parties
relating to the Hazelton A and Hazelton B Projects. If the
Commission does not approve the inclusion of the interim
rates set in Order No. 21630 in the Hazelton A and B
contracts then, (1) the Hazelton A and B contracts will be
null and voidi (2) either party will be. free to move th'!
Commission for an Order setting dates for filing briefs and a
hearing on the Petitions for Reconsideration i and (3) Com-
plainants may refile their complaints before the Commission
for the Hazel ton A and Hazel ton B proj ects and request that
they be paid at the rates set in Case No. U-1006-248.
3
..
IN WITNSS WHOF, the partie. bave executed this
Settlement Agreement and stipulation effective the 3nl -
day of March, 1988.~'k~~
A¡ Is~ B. Ormiston
Counsel for Bypass Limited
~nd Sithe Energies USA~l~_
loí lsI John A. RosholtCounsel for Northside Canal
Company
,.W!f
Counsel for Idaho Power
Company
4
..
EXHIBIT C
JOINT NOTICE OF INTENT TO WITHDRAW
PETITION FOR RECONSIDERATION AND
CROSS-PETITION FOR RECONSIDERATION
..
Barton L. Kline
EVANS, KE, KOONTZ, BOYD, SIMKO & RIPLEY
101 South Capitol Boulevard, Suite 1700
Post Office Box 959
Boise, Idaho 8370l
(208) 384-l800
Attorneys for Idaho Power Company
Roy L. Eiguren
Peter J. Richardson
LINDSAY, HAT, NEIL & WEIGLER
350 North Ninth Street
Jefferson Place, Suite 400
Boise, Idaho 83702
[phone]
Attorneys for sithe Energies, U.S.A.
and for Bypass Limited
BEFORE TH IDAHO PUBLIC UTILITIES COMMSSION
IN THE MATTER OF THE REVIEW OF TH )
IDAHO PUBLIC UTILITIES COMMISSION' S )
POLICIES ESTABLISHING AVOIDED COSTS )
UNDER THE PUBLIC UTILITY REGULATORY )
POLICIES ACT OF 1978 AND IMPLENTING )SECTION 210 OF THT ACT REQUIRING )
THE PURCHASE OF ELECTRICITY FROM )
COGENERATORS AND SMALL POWER )PRODUCERS )
CAE NO. U-1500-170
JOINT NOTICE OF INTENT TO
WITHDRAW PETITION FOR
RECONSIDERTION AND
CROSS-PETITION FOR
RECONSIDERTION
COME NOW, sithe Energies USA (Sithe) and Idaho Power
Company (Idaho Power), and hereby notify the Idaho Public
utilities Commission (Commission) pursuant to Rule 7.7 of the
Commission's Rules of Practice and Procedure (IDAPA 31.A, 7.7), of
their joint intent to withdraw Sithe' s Petition for Reconsidera-
tion and Idaho Power's Cross-Petition for Reconsideration of Order
Nos. 21249 (Issued May 26, 1987), 21332 (Issued July 13, 1987) and
21630 (issued December 1, 1987).
JOINT NOTICE OF INTENT TO WITHDRAW - 1
..
Pursuant to the Settlement Agreement and Stipulation
filed with the Commission and dated March 3, 1988, the parties
have successfully negotiated and executed a Firm Energy Sales
Agreement for the Hazelton "A" project and have agreed upon the
form of a contract for Hazelton liB." The parties therefore
consider the terms and conditions of the Settlement Agreement and
Stipulation (but for the Commission's granting the Application for
Approval of the Power Sales Agreement for Hazelton "A") to be
fulfilled. That Settlement Agreement and Stipulation states, in
part:
Concurrent with the application to the Commission for
approval of the Hazel ton A and Hazel ton B contracts,
both parties will file motions withdrawing their respec-
tive Petitions for Reconsideration in Case
No. U-1SOO-170. The Commission's approval of the
Hazelton A and Hazelton B contracts as submitted and its
granting of the Motions withdrawing the Petitions for
Reconsideration will he a condition precedent to the
effectiveness of the Hazelton A and B contracts and will
constitute a full accord and satisfaction of all
outstanding issues between the parties relating to theHazel ton A and Hazel ton B Proj ects .
A true and complete copy of the Settlement Agreement and
Stipulation is attached hereto and by this reference made a part
hereof. Exhibit A.
Upon the Commission's approval of the Power Sales
Agreement for the Hazelton "A" project sithe will withdraw its
Petition for Reconsideration and Idaho Power will withdraw its
Cross-Petition for Reconsideration. Upon Commission approval of
the Firm Energy Sales Agreement for Hazelton "A," sithe and
Idaho Power will consider the terms and conditions of the
JOINT NOTICE OF INTENT TO WITHDRAW - 2
....
Settlement Agreement and Stipulation to have been satisfied in
full.
This Notice of Withdrawal is hereby made expressly
contingent upon the Commission's granting the Application for
Approval of the Power Sales Agreement for the Hazelton "A" project
in Case No. IPC-E-89-2.
Dated in Boise, Idaho, this 30th day of January, 1989.
LINDSAY, HAT, NEIL & WEIGLER
Roy LPeter
- Of the Firm -
Attorney's for Petitioner,
sithe Energies, U.S.A.
~
Dated in Boise, Idaho, this 30th day of January, 1989.
EVANS, KEANE, KOONTZ, BOYD,
SIMKO & RIPLEY
BarM§l~
- Of the Firm -
Attorneys for Respondent,
Idaho Power Company
JOINT NOTICE OF INTENT TO WITHDRAW - 3
,..
PROOF OF SERVICE
I HEREBY CERTIFY that I have this 30th day of January
1989, served the foregoing NOTICE OF INTENT TO WITHDRAW PETITION
FOR RECONSIDERATION AND CROSS-PETITION FOR RECONSIDERATION upon
all parties of record in this proceeding, by mailing a copy
thereof, properly addressed with postage prepaid, to the
addressees as noted on the attached list.
JOINT NOTICE OF INTENT TO WITHDRAW - 4