20200723Notice of Affiliate Transaction Foote Creek-Redacted.pdf

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Timothy K. Clark
Senior Afrorney
1407 W. North Temple, Suite 320
Salt Lake CiO, UT 84116
801-220-4565 Offtce
T im. C I ar k@1t a c iJi c o rp. c o m
July 23,2020
Idaho Public Utilities Commission
I1331 W. Chinden Blvd
Building 8 Suite 20lA
Boise,ID 83714
Attention Diane Hanian
Commission Secretary
PacifiCorp Notice of Affiliate Transaction
Case No. PAC-E-05-8
Dear Ms. Hanian:
Pursuant to Commitmentl 17(2'1, incorporated in the Idaho Public Utilities Commission
OrderNo. 29973, issued February 13,2006,as supplemented by OrderNo. 29998 March 14,2006,
in the above-referenced proceeding, approving the acquisition of PacifiCorp by MidAmerican
Energy Holdings Company (now Berkshire Hathaway Energy Company or BHE), PacifiCorp
hereby provides notice of an affiliated interest transaction with BHE Wind, LLC ("BHE Wind")
to puicirase I worth of wind turbine equipment for PacifiCorp's Foote Creek wind
facility (the .WinilTdect"). A copy of the Purchase and Sale Agreement (the "Agreement") is
included with this Notice as Confidential Attachment A. The Agreement contains sensitive pricing
and cost information which, ifdisclosed to the public, could erode the Company's ability to bargain
with vendors in the future.
PacifiCorp is a wholly-owned subsidiary of Berkshire Hathaway Energy Company
("BHE"). BHE Renewables, LLC ("BHER") is a limited liability company, which is also a wholly-
owned subsidiary ofBHE. BHE Wind,LLC is a limited liability company which is a wholly owned
subsidiary of BHER. Therefore, BHE's ownership interest in PacifiCorp and BHER creates an
affiliate interest relationship between PacifiCorp and BHE Wind in some PacifiCorp jurisdictions.
Based in Phoenix, Arizona, BHE Wind owns solar, wind, geothermal, and hydroelectric
projects that produce energy for both the wholesale market and for customers under long-term
power agreements. BHE Wind is transferring certain wind turbine equipment to PacifiCorp for use
in its wind repowering project.
Re
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Idaho Public Utilities Commission
July 23,2020
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Vestas Vl l0 60 hertz2.0 MW equipment will be transferred to PacifiCorp via a purchase and sale
agreementpricedatBHEWind;siostoff.Thecostsofthetransferredequipment
were paid and incurred by BHE Wind in 2016 and are projected to constitute five percent or more
of the eventual total cost of the Wind Project. This "frve-percent safe harbor" equipment
establishes a 2016 beginning of construction date that qualifies the Wind Project for 100 percent
Production Tax Credits ("PTCs") so long as the Wind Project is placed in service before January l,
202l.If this same equipment was transferred to PacifiCorp by an unrelated party (a non-affiliated
party), the costs would be treated as paid and incurred by PacifiCorp in 2020 rather than in 2016,
and the project would not be eligible for 100 percent PTCs.r This transaction supports the cost
effectiveness and deliverability for the repowering of the Foote Creek facility for the benefit of
customers.
Please do not hesitate to contact me if you have any questions
Sincerely
/.--h- l: (/^. (-/l/
Timothy K. Clark
Senior Attorney
PacifiCorp
Enclosures
I With respect to transfers of solely tangible personal property between related parties, amounts paid or incurred by
the transferor with respect to such property can be taken in to account by the transferee for the purposes ofthe five-
percent safe-harbor method for establishing the beginning of construction date. Conversely, when a transfer consists
solely oftangible personal property to a transferee not related to the transferor, costs paid or incurred by the
transferor may not be taken into account by the transferee for the purposes ofthe five-percent safe harbor.
2
CONFIDENTIAL
ATTACHMENT A
PacifiCorp Notice of Affiliate Transaction
to
J
THIS ATTACHMENT IS CONFIDENTIAL IN ITS
ENTIRETYAND IS PROVIDED UNDER SEPARATE
COVER