20150619Motion to Strike Wenner Testimony.pdf

DONALD L. HOWELL, II
DAPHNE HUANG
DEPUTY ATTORNEYS GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
472 WEST WASHINGTON STREET
PO BOX 83720
BOISE, tD 83720-0074
Idaho Bar Nos. 3366 and 8370
Tele: [phone]
(208) 334-03 l 8
Fax: [phone]
E-mail : don.howell@puc. idaho. gov
daphne.huan g@puc. idaho. eov
Attorneys for Commission Staff
IN THE MATTER OF IDAHO POWER
COMPANY'S PETITION TO MODIFY
TERMS AND CONDITIONS OF PURPA
PURCHASE AGRE,EMENTS
IN THE MATTER OF AVISTA
CORPORATION'S PETITION TO MODIFY
TERMS AND CONDITIONS OF PURPA
PURCHASE AGREEMENTS
IN THE MATTER OF ROCKY MOUNTAIN
POWER COMPANY'S PETITION TO
MODIFY TERMS AND CONDITIONS OF
PURPA PURCHASE AGREEMENTS
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
CASE NO. IPC.E.15.O1
CASE NO. AVU-E.15.01
CASE NO. PAC.E.15-03
STAFF'S MOTION TO STRIKE
ADAM WENNER'S DIRECT
TESTIMONY
COMES NOW the Staff of the Idaho Public Utilities Commission and files this
Motion to Strike the Direct Testimony of Idaho Conservation League and Sierra Club witness
Adam Wenner, filed April 22,2015. For the reasons below, the Commission should strike
Wenner's testimony as improper and inadmissible.
BACKGROUND
On January 30, 2015, Idaho Power Company filed a Petition asking that the
Commission issue an Order reducing the length of new IRP-based PURPA contracts from 20
STAFF'S MOTION TO STRIKE
years to two years. In Order Nos. 33222 and33250, the Commission granted temporary relief to
Idaho Power, Avista and Rocky Mountain Power, while the Commission investigates the issue of
contract length. In Order No. 33253, the Commission set deadlines for Staff s and Intervenors'
prefiled direct and rebuttal testimony and the utilities' prefiled rebuttal testimony, and set a
technical hearing to begin on June 29,2015. Order No. 33253 at 5.
Several parties timely filed direcl and rebuttal testimony. Among them were the
Idaho Conservation League (ICL) and the Sierra Club, which filed direct and rebuttal testimony
by witnesses Thomas Beach and Adam Wenner. Commission Staff now moves to strike all of
Wenner's direct testimony following page 1, line 14.
ARGUMENT
Commission Staff moves to strike Wenner's testimony, which ICL and the Sierra
Club improperly offered into the record before the Commission, for two reasons. First, it is well-
established that issues of law, on which Wenner opines, are not proper subjects for expert
testimony. Second, Idaho law and rules prohibiting the unauthorized practice of law prohibit
consideration of Wenner's testimony as memoranda of legal arguments.
1. Wenner's Testimony should be Stricken as Inadmissible Legal Conclusions
Although it is not bound by the rules of evidence, the Commission generally follows
"[r]ules as to the admissibility of evidence used by the district court of Idaho in non-jury civil
cases." Rule of Procedure 261, IDAPA 31.01 .01.261; see OrderNo.30955 at 7 (Commission
applied its discretion pursuant to Rule 261 and denied a Motion to Strike). Both the state and
federal evidentiary Rule 702 provide,
If scientific, technical, or other specialized knowledge will assist the trier of
fact to understand the evidence or to determine a fact in issue, a witness
qualified as an expert by knowledge, skill, experience, training, or education,
may testify thereto in the form of an opinion or otherwise.
Idaho R. Evid. 702;Fed. R. Evid. 702. Case law addressing the rule is well settled.
Discussing Rule 702, the Ninth Circuit Court of Appeals recently wrote, "an expert
cannot testify to a matter of law amounting to a legal conclusion." United States v. Tamman,782
F.3d 543, 552-53 (9th Cir. 2015); citing Aguilar v. Int'l Longshoremen's Union,966 F.2d 443,
447 (9th Cir. 1992). In Tamman, the challenged expert testimony "provided only a recitation of
facts and the legal conclusion that [the defendant] acted in conformity with unidentified SEC
rules and regulations and otherwise did not break the law." Id. at 553. This, the Court
STAFF'S MOTION TO STRIKE
concluded, "is not a proper expert opinion," thus the lower court did not err in excluding the
expert's testimony. /d.
In an earlier case, also holding that "[e]xpert testimony is not proper for issues of
law," the Ninth Circuit Court of Appeals explained, "Experts interpret and analyze factual
evidence. They do not testifu about the law." Crow Tribe of Indians v. Racicot,8T F.3d 1039,
1045 (9th Cir. 1996) (internal quotation and citation omitted).
The Idaho Supreme Court also addressed the issue in Carnell v. Barker Management,
Inc,, 137 Idaho 322,48 P.3d 651 (Idaho 2002). In Carnell, the Court considered a district
court's ruling striking an affidavit that provided "nothing more than conclusions as to questions
of law." Id. at328,48P.3dat657. The Court concluded,'oWitnesses are not allowed to give
opinions on questions of law," and affirmed the district court ruling asproper. Id.
Applied here, Wenner's testimony, offering his opinions about the law, is improper.
In stating his qualifications as an expert witness, Wenner summarizes his experience as an
attorney. Wenner Direct (attached) at l. When asked about his opinion of Idaho Power's
proposal, Wenner responds, "In my view [Idaho Power's] approach does not satisfu the FERC's
regulations and is inconsistent with PURPA." Id. at2. Wenner specifies that "[a]n Idaho PUC
policy that limits legally enforceable obligations to purchase from QFs to a two year period
would be inconsistent with and in violation of the FERC's regulation." Id. at2-3.
Quoting from FERC Order No. 69, Wenner offers his legal analysis that the quoted
language "must be read to require that sufficiently long contract terms or legally enforceable
obligations are available . . ., a requirement that is not consistent with a two-year term." Id. at 3-
4. Wenner affirms his belief that the Idaho Supreme Court has "interpreted [8 CFR] section
292.304(d) as granting a QF the right, under PURPA, to a long-term fixed contract." Id. at 5-6.
Wenner further opines, "If a state commission adopts rules under which a utility is permitted to
limit the purchase obligation to a term that is too short to enable it to affect the utility's planning,
then the state commission will have failed to implement the FERC's regulations permitting
capacity payments." Id. at7.
Again addressing contract length, Wenner asserts that, contrary to IPUC Order No.
33253,Idaho Supreme Court decisions cited therein do not give the Idaho PUC discretion to
establish a maximum contract length for QFs that would impede the QF from receiving a long-
term avoided cost contract. Id. at 9-10, citing Afton Energt v. Idaho Power, 107 Idaho 781
STAFF'S MOTION TO STRIKE
(198a); Idaho Power v. Idaho PUC,155 Idaho 780 (2013). Wenner sums up his legal analysis,
reiterating that an Order approving Idaho Power's proposal - to establish "a maximum required
term of two years for Idaho QF PURPA contracts" - "would not be consistent with PURPA or
the FERC's regulations thereunder." Id. at l0-1 l.
Wenner's testimony is plainly legal opinion, argument or analysis. Even Sierra Club
and ICL's other witness, Thomas Beach, characterizes Wenner's testimony as "detailed legal
analysis." Beach Direct at 3. As such, Wenner's testimony is improper. Wenner's legal
conclusions will not assist the trier of fact to understand the evidence or determine afact at issue,
but are inadmissible opinions on the ultimate issue of law before the Commission. Accordingly,
except for the introductory and background statements on page I (lines l-13), Wenner's direct
testimony must be stricken.
2. If Offered as Legal Argument, Wenner's Testimony should be Rejected as the
Unauthorized Practice of Law
To the extent Wenner asserts his testimony should be considered as legal memoranda,
rather than expert opinion, such a submission would violate Idaho statutes governing the practice
of law. The Idaho Legislature gave the Board of Commissioners of the Idaho Bar the power to
promulgate requirements, qualifications, and procedures regarding bar admission, subject to
approval by the Idaho Supreme Court. Idaho Code $ 3-408; see also ldaho Code $ 3-420
(making it unlawful to practice law without a license).
Under Idaho Bar Commission Rules, an attorney practicing in Idaho must be licensed
to practice in Idaho, or be admitted pro hac vice. Bar Comm. R. 101,227. Idaho Bar
Commission Rule 227 conceming pro hac vice admission is incorporated by reference in this
Commission's Rules of Procedure 19 and 43.03. IDAPA 31.01.01.019, .043.03. Mr. Wenner is
neither licensed to practice in Idaho, nor admitted pro hac vice in these proceedings.
Accordingly, his direct testimony is not properly before this Commission as legal memoranda.
STAFF'S MOTION TO STRIKE
CONCLUSION
For the foregoing reasons, Commission Staff asks the Commission to strike and not
consider Wenner's direct testimony following page 1, line 13, in these proceedings. If the
Commission grants Staff s Motion as requested, Staff suggests that the Commission direct all
parties to identify the pages and lines of their witnesses' testimony referencing Wenner's
stricken testimony, so that those parts of the record can be stricken as well.
Respectfully submitted this 19th day of June 2015.
N : IPC-E- I 5-0 I AVU-E- I 5-0 I _PAC-E- I 5-03_djh_Motion to Strike
STAFF'S MOTION TO STzuKE
Benjamin I. Otto (lD Bar # 8292)
710 N 6'h Street
Boise,lD 83701
Ph: [phone]x12
Fax [phone]
[e-mail]
Matt Vespa (CA Bar #227265)
Siena Club
85 Second St.,2nd Floor
San Francisco, CA 94105
Ph: (als) 977-5753
Fax [phone]
matt.vespa@sierraclub. com
Attorneys for the ldaho Conservation League and Sierra Club
IN THE MATTER OF IDAHO POWER
COMPANY'S PETITION TO MODIFY TERMS
AND CONDITIONS OF PURPA PURCHASE
AGRSEMENTS
IN THE MATTER OF AVISTA
CORPORATION'S PETITION TO MODIFY
TERMS AND CONDITIONS OF PURPA
PURCHASE AGREEMENTS
IN THE MATTER OF ROCKY MOUNTAIN
POWER COMPATIY'S PETITION TO
MODIFY TERMS AND CONDITIONS OF
PURPA PURCHASE AGREEMENTS
Idaho Conservation League and the Sierra Club
ri22
BEFOR.E THE IDAHO PUBLIC UTILITIES COMMISSION
CASE NO.IPC.E.Is.OI
CASE NO. AVU-E.I5.OI
CASE NO. PAC.E-15-03
Direct Testimony of Adam Wenner
April23,2015
I Q. What is your name and background?
2 A. My name is Adam Wenner. I am a partner at Orrick, Herrington and Sutcliffe, LLP, and
3 work in the Washington DC office. Prior to working at Orrick, I served as an attorney in the
4 Federal Energy Regulatory Commission ("FERC") Office of the General Counsel, from 1976-
5 1981. During my term at the FERC, I worked with a staffteam that was responsible for drafting
6 and implementing regulations under the Public Utility Regulatory Policies Act of 1978
7 ("PURPA"). In that capacity I am listed as one of the four staff contacts for the FERC's order
8 adopting regulations implementing section 210 of PURPA, which requires electric utilities to
9 purchase electric power from and sell electric power to qualifuing cogeneration and small power
l0 production facilities ("QFs"), and to pay rates based on the utility's avoided costs. These
I I regulations require state regulatory commissions to implement the FERC regulations.
12 Since leaving FERC in 1981, I have worked as an attorney in the electric power industry
l3 and have handled many matters relating to PURPA.
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15 a. As a staffmember, you did not vote on the rules that FERC issued, correct?
16 A. That is correct. I and the other members of the group working on PURPA
17 implementation drafted proposed rules, participated in conferences around the country,
l8 reviewed and analyzed comments filed in the rulemaking proceeding, and drafted a
19 recommended final rule that FERC voted to adopt.
20
2l a. What is the purpose ofyour testimony?
22 A. I have been asked to provide my opinion regarding a proposal before the Idaho Public
23 Utility Commission ("ldaho PUC") in the above-styled docket regarding the PURPA and FERC
24 requirements for long-term power purchases from QFs. In this docket the Idaho PUC is
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I considering a proposal ("Petition") by ldaho Power Company ("ldaho Power") to direct that the
2 maximum required term for prospective Idaho Power PURPA energy sales agreements be
3 reduced from 20 years to two years.
4
5 Q. Do you have an opinion as to whether this approach is consistent with PURPA and the
6 FERC's PURPA regulations and decisions?
7 A. Yes. In my view this approach does not satisfr the FERC's regulations and is inconsistent
8 with PURPA.
I
l0 a. Please explain the basis for your opinion.
I I A. There are two grounds for my opinion: (l) the PURPA legislation and the FERC
12 regulations require that QFs be paid capacity payments when their commitment to provide
l3 energy to a utility enables the utility to replace new capacity with QF purchases. Capacity can
14 only be replaced when QF power is guaranteed to be available for a term that is sufficiently long,
l5 in terms of the utility planning horizon - which typically involves twenty-year or longer service
16 lives for the "avoided" generating unit that is displaced by Qf energy and capacity; and (2) the
17 FERC regulations provide QFs, at their option, the legal right to provide energy and capacity to a
l8 utility pursuant to a "legally enforceable obligation", over a term specified by the QF, in which
19 the QF is paid based on projections of avoided costs, determined at the time that the obligation is
20 incurred. FERC has interpreted this regulation to mean that by making a binding offer to sell its
2l power over a specified term, the QF obligates the state commission to impose a legally
22 enforceable obligation to purchase the QF's power over the specified term, at rates based on
23 projected avoided costs. An Idaho PUC policy that limits legally enforceable obligations to
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I purchase from QFs to a two year period would be inconsistent with and in violation of the
2 FERC's regulation.
3
4 a. Please elaborate on the first reason that you identify above for concluding that ldaho's
5 proposal to limit QF contracts to two years is not appropriate.
6 A. As FERC noted in Order No. 69 in a discussion about whether avoided costs should
7 include capacity payments as well as energy payments, the Conference Report issued by Congress,
8 in conjunction with section 210 of PURPA, stated:
9 The conferees expect that the Commission in judging whether the electric
l0 power supplied by the cogenerator or small power producer will replace future
I I power which the utility would otherwise have to generate itself either through12 existing capacity or additions to capacity or purchase from other sources will take
13 into account the reliability of the power supplied by the cogenerator or small
14 power producer by reason of any legally enforceable obligation of suchl5 cogenerator or small power producer to supply firm power to the utility.
l617 Small Power Production and Cogeneration Facilities; Regulations Implementing Section 210 of the
l8 Public Utility Regulatory Policies Act of 1978, Order No. 69, FERC Stats. & Regs. J 30,128 (1980),
l9 45 Fed. Reg. 12,214, 12,225 (Feb. 25, 1980) ("Order No. 69") (quoting Conference Report on
20 H.R. 4018, Public Utiliry Regulatory Policies Act of 1978, H. Rep. No. 1750,99,95th Cong., 2d.
2l Sess. (1978)).
22 Based on this Congressional intent of PURPA, FERC observed, in Order No. 69, that:
23 In order to defer or cancel the construction of new generating units, a24 utility must obtain a commitment from a qualifting facility that provides25 contractual or other legally enforceable assurances that capacity from alternative26 sources willbe available sufficiently ahead of the date on which the utility would27 otherwise have to commit itself to the construction or purchase of new capacity.28 If a qualiffing facility provides such assurances, it is entitled to receive rates based29 on the capacity costs that the utility can avoid as a result of its obtaining capacity30 from the qualifring facility.
3l32 45 Fed. Reg. at 12,225.
JJ
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I Q. How does this instruction by FERC apply to an Idaho QF's right to a purchase contract
2 of more than two years?
3 A. The FERC's language is straightforward. If a QF enters into a contract or provides "legally
4 enforceable assurance" that it will be available on the date that the utility would otherwise make a
5 commitment to construct new generating capacity, then the QF is entitled to payments based on
6 the avoided cost of constructing the new generating unit. A new conventional coal or gas-fired
7 plant has a service life in excess of 20 years, and therefore can only be replaced by power from
8 QFs if the QFs are obligated to provide power for a term at least that long. Conversely, if a QF
9 contracts or legally enforceable obligations are limited to two years, that power cannot be
l0 counted on to be available after two years, and so a utility could not cancel planned generation
I I based on such a short commitment. The FERC's statement in Order No. 69 accordingly must be
12 read to require that sufficiently long contract terms or legally enforceable obligations are available
l3 to enable planned generation to be canceled, a requirement that is not consistent with a two-year
14 term.
l5
16 a. Are there other provisions of the FERC's regulations under PURPA that shed light on
17 this issue?
l8 A. Yes. Section292.304(d)(2) of the FERC's rules states that a QF has the option to provide
l9 energy or capacity on an "as-available" basis, or pursuant to a "legally enforceable obligation for
20 the delivery of energy or capacity over a specified term."
2l
22 a. Does the QF have options with respect to the determination of its avoided cost rate, if it
23 chooses the second option, namely to provide energy pursuant to a "legally enforceable
24 obligation for the delivery of energy or capacity over a specified term"?
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I A. Yes. Section292.304(d)(2) states that the QF has the option to receive avoided cost rates
2 calculated at the time of delivery or at the time the obligation is incurred.
J
4 a. Do the FERC rules specifr a specific number of years or other time period for the term
5 over which the QF which accepts a legally enforceable obligation is entitled to receive avoided
6 cost rates calculated at the time the obligation is incurred?
7 A. No. However, there are many provisions of the rules and of FERC's decisions applying its
8 rules that provide guidance on this topic.
9
l0 a. Please describe these provisions.
1l A. First, FERC has explained that section 292.304(d)(2) gives a QF the right to establish a
12 fixed contract price for its energy and capacity at the outset of its obligation. Order No. 69,
l3 FERC Stats. & Regs. J 30,128 at 30,880).
t4
l5 a. Did FERC explain that the section 292.304(d)(2) right to a fixed price contract means
l6 that a QF has a right to a contract or legally enforceable obligation based on projected avoided
17 costs?
l8 A. Yes. Section 292.304(d)(2) provides that a QF has the option to sell on an "as-available"
l9 basis, or pursuant to a legally enforceable obligation, over a specified term. In the latter case, the
20 QF has the option to select rates that are calculated at the time that the obligation is incurred.
2l
22 a. Are there instances in which FERC characterized the right of a QF to a fixed-rate
23 contract or legally enforceable obligation under section 292,304(d)(2) as grving a QF the right,
24 at its option, to a long-term contract?
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A. Yes. In its discussion in Order No. 69 of "levelized avoided cost payments," FERC noted
that that " [a] facility which enters into a long term contract to provide energy or capacity to a
utility may wish to receive a greater percentage of the total purchase price during the beginning
of the obligation." 45 Fed. Reg12,224 (emphasis added).
a. Has Idaho interpreted section 292.304(d) as granting a QF the right, under PURPA, to a
long-term fixed contract?
A. Yes. In its 1984 decision affirming an order by the Idaho PUC requiring Idaho Power
Company to enter into a thirty-five year contract to purchase power from a QF, the Idaho
Supreme Court stated that "FERC's intent that IQFs], at their option, could enter into fixed-term
contracts is manifested by" the above-quoted language from Order No. 69 regarding long-term
contracts. AftonEnergy,lnc.v.IdahoPowerCo.,l07ldaho78l,786,693P.2d427,432(1984)
("Afton Energy'').
a. Did the Afton Energy decision indicate the basis for the thirty-five year contract term
proposed by the QF and imposed by the Idaho PUC?
A. Yes. The decision states "[t]he thirty-five year period corresponds to the life of Idaho
Power's own thermal unit that can be "avoided" by purchasing power from the [QF]." Afton
Energy, 107 Idaho at 783, 693 P.zd at 429.
a. Is that reasoning consistent with the concept of avoided costs, as defined by FERC in
Order No.69?
A. Yes. The provisions that are referenced above, relating to the circumstances in which a
QF can receive capacity payments by enabling the purchasing utility to alter its capacity
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I expansion plans based on the obligation to provide power in the future, inherently contemplate
2 that the QF's legally enforceable obligation will be sufficiently long to accomplish this result. This
3 is consistent with the Idaho PUC's order as affirmed by the Idaho Supreme Court in Afton
4 Energy.
5 If a state commission adopts rules under which a utility is permitted to limit the purchase
6 obligation to a term that is too short to enable it to affect the utility's planning, then the state
7 commission will have failed to implement the FERC's regulations permitting capacity payments.
8
9 a. What other provisions are relevant to this issue?
l0 A. Section 292.302(b)(2) requires utilities to make available the utility's plans for the
I 1 addition of capacity, purchases of firm energy and capacity, and capacity retirements for each
12 year during the succeeding ten years. The ten-year horizon is consistent with the long-term
l3 planning associated with utility capacity additions, and is indicative of the time frame that FERC
14 concluded was necessary in order for QFs to compute the avoided costs on which their contracts
l5 or other legally enforceable obligations would be calculated.
l6
17 a. Are there other provisions of the FERC's rules that shed light on this topic?
l8 A. Yes. Section 292.304(e) identifies factors which are to be taken into account in
l9 determining the avoided cost rate to which a QF is entitled. One of the factors listed is: "(iii) the
20 terms of any contract or other legally enforceable obligation, including the duration of the
2l obligation, termination notice requirement and sanctions for non-compliance."
22
23 a. Did the FERC discuss this provision in its order adopting the PURPA regulations?
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I A. Yes. FERC stated that clause (iii) (quoted above) "refers to the length of time during
2 which the qualifying facility has contractually or otherwise guaranteed that it will supply energy
3 or capacity to the electric utility." Order No. 69,45 Fed. Reg. at 12,226.
4 A utility-owned generating unit normally will supply power for the life of the5 plant, or until it is replaced by more efficient capacity. In contrast, a cogeneration
6 or small power production unit might cease to produce power as a result of
7 changes in the industry or in the industrial processes utilized. Accordingly, the
8 value of the service from the qualifring facility to the electric utility may be
9 affected by the degree to which the qualifying facility ensures by contract or other
l0 legally enforceable obligation that it will continue to provide power. Included in
I I this determination, among other factors, are the term of the commitment, the12 requirement for notice prior to termination of the commitment, and any penalty
13 provisions for breach of the obligation.
1415 rd.
l6
17 a. How is this provision relevant to the issue of the term that a state commission must
l8 establish for QF sales?
l9 A. The rule states that the value of the QF's power, and therefore its avoided cost payment, is
20 linked to the term over which it agrees, by contract or by accepting a legally enforceable
2l obligation, to provide power. Implicit in the rule is that the length of the term over which the QF
22 commits to provide power is a decision for the QF. Also, in discussing QFs' right to capacity
23 payments, FERC stated, in the preamble to its PURPA regulations, that "capacity payments can
24 only be required when the availability of capacity from a qualifying facility or facilities actually
25 permits the purchasing utility to reduce its need to provide capacity by deferring the construction
26 of new plant or commitments to firm power purchase contracts." Order No. 69, 45 Fed. Reg. at
27 t2,225-26. FERC confirmed its position that "if a qualifring facility offers energy of sufficient
28 reliability and with sufficient legally enforceable guarantees of deliverability to permit the
29 purchasing electric utility to avoid the need to construct a generating plant, to enable it to build a
30 smaller, less expensive plant, or to purchase less firm power from another utility than it would
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I otherwise have purchased, then the rates for purchases from the qualifring facility must include
2 the avoided capacity and energy costs." Id. at 12,??6. A state commission PURPA
3 implementation that denies QFs the ability to enter into a contract or legally enforceable
4 obligation to provide long-term value to the utility, and thus to receive avoided cost payments
5 reflecting that value, is inconsistent with section 292.30a(e)(iii).
6 a. Are you aware of orders by the Idaho PUC that discuss its view of the requirements of
7 PURPA and FERC's regulations regarding contract length?
8 A. Yes. I have reviewed Idaho PUC Order No. 33253, issued March 18, 2015. Citing Afton
9 Energy, 107 Idaho at 785-86, 693 P.2d at 431-32 and ldaho Power v. Idaho PUC, 155 Idaho 780,
l0 782,316P.3d 1278,1280 (2013) ("Idaho Power"),that order states that "PURPA, and regulations
I I implementing the Act, are silent as to contract lengh; consequently, the issue is in the Ildaho
12 PUC's] discretion." Idaho PUC Order No. 33253 at 2.
l3
14 a. Do the references to Afton Energlt and ldaho Powerstate that the issue of contract length
l5 is in the Idaho PUC's discretion?
16 A. They do not. In Afton Energy, the Idaho Supreme Court stated that the Idaho PUC'did
17 not abuse its discretion in implementing the mandates of PURPA by requiring Idaho Power to
I 8 contract with Afton for the purchase of its power over a thirty-five year period." Afton Energy,
l9 l07ldaho at786,693P.ldat432. InldahoPower,theldahoSupremeCourtsimplynotedthat
20 "a state regulatory authority has discretion in determining the manner in which the rules will be
2l implemented, and may comply by issuing regulations, by resolving disputes on a case-by-case
22 basis, or by other action reasonably designed to give effect to FERC's rules." Idaho Power,l55
23 Idaho at782,316 P.3d at 1280 (citing FERC v. Mississippi,456 U.S. 742,751(1982)), and that the
24 Idaho PUC has "broad discretion . . . in implementing FERC's rules and in determining the
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I requirements for a legally enforceable obligation." ld., 155 Idaho at 787 ,316 P.3d at 1285.
2 Neither decision gives the Idaho PUC discretion to establish maximum QF contract terms that
3 are inconsistent with PURPA or the FERC's regulations thereunder.
4 Neither decision holds that the Idaho PUC has discretion to implement PURPA or the
5 FERC's regulations thereunder by establishing a maximum contract length for QF that, by any
6 industry standard, does not enable the QF to receive "long-term avoided cost contract or other
7 legally enforceable obligation," as mandated by Order No. 69 and confirmed by lD Wind.
8
9 a. Does Idaho Power express a position on this issue in its Petition?
l0 A. Yes. Idaho Power's Petition states, at page 10, that "Id]etermination of the proper terms
I I and conditions of a required PURPA energF sales agreement, including the authority to
12 determine the proper price, the proper term, and the authority to approve or disapprove the
I 3 contract itself is soundly, and completely, within the authority and discretion of the Ildaho
14 PUC." (emphasis added). It also states, at page 35, that the require term for such a purchase "is
l5 within the authority and discretion of the fldaho PUC] to determine and set."
l6
17 a. In your opinion would an Idaho PUC order establishing a maximum required term of
l8 two years for Idaho QF PURPA contracts be consistent with PURPA and the FERC's regulations
19 under PURPA?
20 A. Such an order would not be consistent with PURPA or the FERC's regulations
2l thereunder. As explained above, PURPA and the FERC regulations grant QFs the right to a
22 contract or legally enforceable obligation to sell energy and capacity at long-term avoided costs.
23 In the electric utility industry, and as discussed in my testimony, a two-year term fails to permit a
24 QF to estimate, with reasonable certainty, the expected return on its potential investment in a
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r0
1 QF, and would frustrate the requirement of section 210 of PURPA that FERC's rules, as
2 implemented by state commissions, encourage cogeneration and small power production.
3
4 a. Does this conclude your testimony?
5 A. Yes.
6
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ll
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS lgth DAY OF JUNE 2015,
SERVED THE FOREGOING STAFF'S MOTION TO STRIKE ADAM WENNER'S
DIRECT TESTIMOI\"Y, IN CASE NOS. IPC-E-15-OI/PAC-E-15-03/AVU-E-I5-01, BY E-
MAILING A COPY THEREOF, TO THE FOLLOWING:
DONOVAN E WALKER
REGULATORY DOCKETS
IDAHO POWER COMPANY
PO BOX 70
BOISE rD 83707-0070
E-mail: [e-mail]
[e-mail]
DR DON READING
6070 HILL ROAD
BOISE ID 83703
E-mail: dreading@mindsprinLcom
DEAN J MILLER
McDEVITT & MILLER LLP
420 W BANNOCK ST
BOISE ID 83702
E-mail: ioe@.mcdevitt-miller.com
KELSEY JAE NUNEZ
SNAKE RIVER ALLIANCE
PO BOX r73l
BOISE ID 8370I
E-mail: [e-mail]
TED WESTON
ID REG AFFAIRS MANAGER
ROCKY MOUNTAIN POWER
2OI S MAIN ST STE 23OO
SALT LAKE CITY UT 84111
E-mail: [e-mail]
PETER J RICHARDSON
GREGORY M ADAMS
RICHARDSON ADAMS PLLC
PO BOX 7218
BOISE ID 83702
E-mail: [e-mail]
gre [e-mail]
BENJAMIN J OTTO
ID CONSERVATION LEAGUE
710 N 6TH STREET
BOISE ID 83702
E-mail: [e-mail]
LEIF ELGETHUN
INTERMOLINTAIN ENERGY PARTNERS
LLC
PO BOX 7354
BOISE ID 83707
E-mail : [e-mail]
KEN MILLER
SNAKE RIVER ALLIANCE
E.MAIL ONLY:
kmiller@ snakeriveralliance. org
DANIEL E SOLANDER
YVONNE R HOGLE
ROCKY MOUNTAIN POWER
2OI S MAIN ST STE 24OO
SALT LAKE CITY UT 8411I
E-mail: [e-mail]
yvonne. ho gl e@paci fi corp. corn
CERTIFICATE OF SERVICE
DATA REQUEST RESPONSE CENTER
E.MAIL ONLY:
datarequest@pacifi corp. com
ERIN CECIL
ARKOOSH LAW OFFICES
E.MAIL ONLY
erin. cecil @arkoosh.com
ANTHONY YANKEL
29814 LAKE ROAD
BAY VILLAGE OH 44104
E-mail: [e-mail]
IRION SANGER
SANGER LAW PC
I I 17 SW 53RD AVE
PORTLAND OR 97215
E-mail: [e-mail]
CLINT KALICH
AVISTA CORPORATION
I411 E MISSION AVE
MSC-23
SPOKANE W A 99202
E-mail : [e-mail]
RICHARD MALMGREN
SR ASSIST GEN COLINSEL
MICRON TECHNOLOGY INC
8OO S FEDERAL WAY
BOISE ID 837I6
E-mail: [e-mail]
C TOM ARKOOSH
ARKOOSH LAW OFFICES
PO BOX 2900
BOISE ID 8370I
E-mail: [e-mail]
ERIC L OLSEN
RACINE OLSON NYE BUDGE
& BAILEY
PO BOX l39l
POCATELLO ID 83204-139 I
E-mail: [e-mail]
RONALD L WILLIAMS
WILLIAMS BRADBURY PC
1OI5 W HAYS ST
BOISE TD 83702
E-mail: [e-mail]
MICHAEL G ANDREA
AVISTA CORPORATION
1411 E MISSION AVE
MSC-23
SPOKANE W A 99202
E-mail : [e-mail]
MATT VESPA
SIERRA CLUB
85 SECOND ST 2ND FLOOR
SAN FRANCISCO CA 94105
E-mail: [e-mail]
FREDERICK J SCHMIDT
PAMELA S HOWLAND
HOLLAND & HART LLP
377 S NEVADA ST
CARSON CITY NV 89703
E-mail : fschmidt@hollandhart. com
CERTIFICATE OF SERVICE
SCOTT DALE BLICKENSTAFF
AMALGAMATED SUGAR CO
1951 S SATURN WAY
STE IOO
BOISE ID 83702
E-mail: [e-mail]
CAROL HAUGEN
CLEARWATER PAPER CORPORATION
E-MAIL ONLY
Carol.haueen@clearwaterpaper. com
JOHN GORMAN
ECOPLEXUS, INC.
650 TOWNSEND STREET, SUITE 3IO
SAN FRANCISCO, CA 94103
E-mail: [e-mail]
ANDREW JACKURA
SR VP NORTH AMERICA DEVL
CAMCO CLEAN ENERGY
9360 STATION ST STE 375
LONE TREE CO 80124
E-mail: [e-mail]
JOHN R. HAMMOND, JR.
FISHER PUSCH LLP
101 S. CAPITOL BLVD., SUITE 701
BOISE, TD 83702
E-mail: [e-mail]
SECRETARY
CERTIFICATE OF SERVICE