19930910Final Order No 25128.pdf

hoe of the SecretarySeMceDate~
SEP 10 1993
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )
OF IDAHO POWER COMPANY FOR AN )CASE NO.IPC-E-93-21
ORDER APPROVING A FIRM ENERGY )SALES AGREEMENT BETWEEN IDAHO )ORDER NO.25128
POWER COMPANY AND SHOROCK HYDRO,)
INC.)
On August 17,1993,Idaho Power Company (Idaho Power;Company)
filed an Application with the Idaho Public Utilities Commission (Commission)
requesting approval of a Firm Energy Sales Agreement (Agreement)between
Idaho Power and Shorock Hydro,Inc.
Shorock Hydro,Inc.(Shorock)is the developer of the Shoshone II
Hydro Project,a proposed 800 KW facility located in the Northwest quarter of
Section 33,Township 5 South,Range 17 East,Boise Meridian,Lincoln County,
Idaho.The project is located adjacent to the Little Wood River.This reach of the
Little Wood River is jointly utilized as part of the canal systems of Water
Districts 37,37M,and the American Falls Reservoir District No.2.Shorock
already owns and operates a diversion structure on the Little Wood River and a
canal conveyingwater to the original Shoshone Hydro Project.The Shoshone II
Power Project will utilize the existing diversion structure and canal for power
generation purposes.As represented,the project currently has a valid FERC
license or exemption and will be a "qualifying facility"(QF)prior to
interconnection.The estimated annual energy production is 3,177,935kWh.The
scheduled operation date is May 1,1994.
The Agreement dated July 28,1993 provides for a 35-year contract
term and contains avoided cost rates computed for 35 years based on the
levelized avoided costs approved by the Commission in Case No.IPC-E-93-4.
Reference Agreement ¶7.1.
The Commission has reviewed the Agreement and finds the terms to
be relatively standard with no significantly unique features.The terms and
provisions of the contract are reasonable and we approve them.We also approve
payments made under this Agreement as prudently incurred expenses for
ratemaking purposes.
ORDER NO.25128 -1 -
The Commission notes that the insurance deductibles included in the
Agreement differ from the underlying requirements of security Order No.21690,
Case No.U-1006-292.The deductibles in the Agreement,as informally
represented by the Company,reflect the current "industry standard."
Differences are:
Agreement ON 21690 (p.23)
¶14.2.2 All Risk Property ...5%total 1%
cost of facility or $25,000
¶14.2.3 Boiler &Machinery ...5%total 2%
cost of equipment or $25,000
¶14.2.4 Business Interruption (loss 10 days
of services)...30 days grossdailyrevenue
We accept the Company'srepresentation as true without further requirement of
proof and approve the insurance deductible amounts as set forth in the
Agreement.
The Commission reminds the parties that jurisdiction may not be
conferred on the Commission by contractual stipulation.The authority and
jurisdiction of the Commission is restricted to that expressly and by necessary
implication conferred upon it by enabling statutes.The nature and extent of the
Commission's jurisdiction to resolve actual disputes will be determined by the
Commission on an individual case-by-case basis not withstanding ¶21.1 of the
Agreement.
CONCLUSIONS OF LAW
I
The Idaho Public Utilities Commission has jurisdiction over Idaho
Power Company,an electric utility,pursuant to the authority and power granted
it under Title 61 of the Idaho Code and the Public Utility Regulatory Policies Act
of 1978 (PURPA).
II
The Idaho Public Utilities Commission has authority under the Public
Utility Regulatory Policies Act of 1978 and the implementing regulations of the
Federal Energy Regulatory Commission (FERC)to set avoided costs,to order
electric utilities to enter into fixed term obligations for the purchase of energy
from small power producers,and to implement FERC rules.
ORDER NO.25128 -2 -
ORDER
In consideration of the foregoing and as so qualified,IT IS HEREBY
ORDERED that the Firm Energy Sales Agreement between Idaho Power
Company and Shorock Hydro,Inc.submitted in this proceedingbe and the same
is hereby approved.
THIS IS A FINAL ORDER.Any person interested in this Order
may petition for reconsideration within twenty-one (21)days of the service date
of this Order with regard to any matter decided in this Order.Within seven (7)
days after any person has petitioned for reconsideration,any other person may
cross-petition for reconsideration.See Idaho Code §61-626.
DONE by Order of the Idaho Public Utilities Commission at Boise,
Idaho,this -day of September 1993.
RSHA H.SMITH,PRESIDENT
.MILLER,COMMISSIONER
RALPHNELSON,ÍOMMISSIONER
ATTEST:
MYÉNA J.WALTERSCOMMISSIONSECRETARY
SW:JR/O-2233
ORDER NO.25128 -3 -