20101006final_order_no_32084.pdf

Office of the Secretary
Service Date
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
October 6 2010
WINDLAND, INC.
COMPLAINANT,
ACIFICORP DBA ROCKY MOUNTAIN
POWER
DEFENDANT.
IN THE MATTER OF THE APPLICATION
OF PACIFICORP DBA ROCKY MOUNTAIN
POWER FOR APPROVAL OF POWER
PURCHASE AGREEMENTS BETWEEN
ACIFICORP AND POWER COUNTY WIND
NORTH LLC AND POWER COUNTY WIND
SOUTH LLC
) CASE NO. PAC-IO-
) ORDER NO. 32084
Complaint
On April 6, 2010, Windland, Inc. (Windland) filed a complaint with the Idaho Public
Utilities Commission (Commission) against PacifiCorp dba Rocky Mountain Power. Windland
claimed entitlement to and requested that PacifiCorp be required to execute two standard
PURP A Power Purchase Agreements for Windland's Power County Wind Park North and Power
County Wind Park South small power generation projects at the published PURP A avoided cost
rates in effect prior to March 12, 2009, i., the higher grandfathered rates of Order No. 30744.
On April 28, 2010, a Summons was issued by the Commission directing PacifiCorp
to file an answer within 21 days. On April 29, 2010, PacifiCorp filed an answer with the
Commission requesting a Commission determination that Windland's Power County wind
projects are not entitled to grandfathered rates.
POWER PURCHASE AGREEMENTS
(and Contingent Motion to Dismiss Complaint, Application ~ 3)
On August 20 2010, PacifiCorp filed an Application with the Commission requesting
approval of two Power Purchase Agreements (PP As; Agreements) entered into between
PacifiCorp dba Rocky Mountain Power and Power County Wind Park North LLC and Power
ORDER NO. 32084
County Wind Park South LLC dated August 18, 20 I 0 (the LLCs). The locations of the two wind
facilities are described as follows:
North: T8S, R3IE, Section 13 and T8S, R32E, Sections 6, 7, 8 , 17, 18 , Power
County, Idaho
South: T8S, R32E, Sections 19, 20, 29 and 30, Power County, Idaho
Agreements, Exh. A.
The total nameplate capacity for each of the two small power wind generation
facilities (QFs) is 21.780 MW. Agreements, Recital A. Average monthly output for each
facility will be below 10 MW. Agreements, Exh. D. The estimated average annual net output of
each facility is 67 311 441 kWh (North) and 60 523 733 kWh (South). Agreements, Recital D.
The QFs have elected December 31 , 2011 as the scheduled commercial operation date for their
facilities.
Windland and the LLCs have waived their claims to grandfathered rights to the
avoided cost rates contained in Order No. 30744. Application, ~ 7. The Power Purchase
Agreements contain the current non-Ievelized published avoided cost rates established in Order
No. 31025. The $6.50IMWh wind integration charge approved by the Commission (Order No.
31 021) and all other applicable interconnection charges and monthly O&M charges under the
generation interconnection agreement with PacifiCorp transmission will be assessed to the LLCs.
Agreements, Section 5.
Section 11.1 of the PP As provides for Delay Security of $25 multiplied by the
Maximum Facilities' Delivery Rate measured in kilowatts. This results in delay security of
$544 500 under each PP A. Pursuant to Section 11.1.4 one-quarter of the Delay Security amount
is to be refunded to the QFs as each of four milestones are achieved. The approach to delay
security has been agreed to by the parties in compromise of Windland's pending complaint in
Case No. PAC-IO-05 and is not intended to establish any precedent.
As reflected in Section 2.1 of the Agreements, the Agreements will not become
effective until the Commission has approved all the Agreements' terms and conditions and
declares that all payments that PacifiCorp makes to the wind projects for purchases of energy
will be allowed as prudently incurred expenses for ratemaking purposes.
ORDER NO. 32084
On September 2, 2010, the Commission issued Notices of Complaint (and Contingent
Motion to Dismiss), Application, and Modified Procedure in Case No. PAC-1O-05. The
deadline for filing written comments was September 30, 2010. Commission Staff was the only
party to file comments.
Staff Comments
Staff recommends that the Commission approve all of the Agreements' terms and
conditions. Staff notes that Windland and the LLCs pursuant to negotiation have waived their
claims to grandfathered rights to the higher avoided cost rates contained in Order No. 30744
(Application ~ 7). The filed Power Purchase Agreements contain the current, lower non-
levelized published avoided cost rates established in Order No. 31025. As noted by Staff, and
represented by the Company, the approach to Delay Security set forth in the Agreements is part
of a negotiated settlement and compromise of Windland's pending complaint in Case No. PAC-
I0-05 and is not intended to establish any precedent. Application ~ 8.
COMMISSION FINDINGS
The Commission has reviewed the filings of record in Case No. PAC-I0-
including the complaint, the two Power Purchase Agreements and the Contingent Motion to
Dismiss. We have also reviewed the comments and recommendations of Commission Staff. We
continue to find it reasonable to process the Company s Application under Modified Procedure
IDAPA 31.01.01.204.
PacifiCorp has presented two Firm Energy Sales Agreements for wind facilities in
Power County, Idaho. As represented and pursuant to agreement, under normal and/or average
conditions the individual projects will not exceed 10 aMW on a monthly basis. We thus find the
projects are qualified to receive the published avoided cost rates approved by the Commission.
The Commission finds that the Agreements submitted in this case contain acceptable
contract provisions and include the current non-Ievelized published rates approved by the
Commission in Order No. 31025. We find it reasonable that the submitted Agreements be
approved without further notice or procedure. We further find it reasonable to allow payments
made under the Agreements as prudently incurred expenses for ratemaking purposes.
Inasmuch as we have found it reasonable in this case to approve the two Power
Purchase Agreements, we further find it reasonable to grant the request of the parties to dismiss
the underlying complaint of Windland with prejudice.
ORDER NO. 32084
CONCLUSIONS OF LAW
The Idaho Public Utilities Commission has jurisdiction over PacifiCorp dba Rocky
Mountain Power, 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).
The Commission has authority under PURP A and the implementing regulations of
the Federal Energy Regulatory Commission (FERC) to set avoided costs, to order electric
utilities to enter into fixed-term obligations for the purchase of energy from qualified facilities
(QFs) and to implement FERC rules.
ORDER
In consideration of the foregoing and as more particularly described above, IT IS
HEREBY ORDERED and the Commission does hereby approve the August 18, 2010, Power
Purchase Agreements entered into between PacifiCorp dba Rocky Mountain Power and Power
County Wind Park North LLC and Power County Wind Park South LLC.
IT IS FURTHER ORDERED and pursuant to agreement of the parties (Application ~
3) that the underlying complaint of Windland Inc. against PacifiCorp dba Rocky Mountain
Power is dismissed with prejudice.
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. Within seven (7)
days after any person has petitioned for reconsideration, any other person may cross-petition for
reconsideration. See Idaho Code ~ 61-626.
ORDER NO. 32084
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this
/p
day of October 2010.
,;/
MPTON, PRESIDENT
MARSHA H. SMITH, COMMISSIONER
~~\61J
MACK A. REDFORD, COMMISSIONER
ATTEST:
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ORDER NO. 32084