20151027final_order_no_33405.pdf

Office of the Secretary
Service Date
October 27,2015
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF PACIFICORP DBA )
ROCKY MOUNTAIN POWER’S )CASE NO.PAC-E-15-1l
APPLICATION TO APPROVE ITS POWER )
PURCHASE AGREEMENT WITH )ORDER NO.33405
CONSOLIDATED IRRIGATION COMPANY )
On September 18,2015,PacifiCorp dba Rocky Mountain Power (the Company)filed
an Application asking the Commission to approve its Power Purchase Agreement with
Consolidated Irrigation Company (CIC).Under the Agreement,CIC would sell,and the
Company would purchase,electric energy generated from CIC’s facility —a qualifying facility
under the Public Utility Regulatory Policies Act —in Preston,Idaho.
The Commission issued a Notice of Application and Notice of Modified Procedure,
setting a 21 -day comment period.Commission Staff was the only party to file written
comments.The Company advised Staff it did not intend to file a reply.The Commission now
approves the Application.
BACKGROUND
On September 11,2015,Rocky Mountain entered into its Agreement with CIC
pursuant to the terms and conditions of various Commission Orders,and under PURPA.
Application at 2-3,citing,Order Nos.33305,30480,Errata to 30480.Under PURPA,electric
utilities must purchase electric power from “qualifying facilities”(QFs)at rates approved by this
Commission.16 U.S.C.§824a-3;Idaho Power v.Idaho PUC,155 Idaho 780,789,316 P.3d
1278,1287 (2013).The purchase or “avoided cost”rate shall not exceed the “incremental cost”
to the utility,defined as the cost of energy which,“but for the purchase from [the QFj,such
utility would generate or purchase from another source.”16 U.S.C.§824a-3(d);18 C.F.R.§
292.101(6)(defining “avoided cost”).Rocky Mountain states CIC’s facility is a hydroelectric
QF under PURPA with a capacity rating of 481 kilowatts (kW).Application at 2.
THE AGREEMENT
“Under the terms of the Agreement,[CIC]elected to contract with the Company for a
term of approximately 20 years.”Id.Rocky Mountain agreed to pay non-levelized,Conforming
Energy or Non-Conforming Energy Purchase Prices for the power provided by CIC.Id.The
Agreement will not become effective until the Commission has approved it and determined “that
ORDER NO.33405 1
the prices to be paid for energy and capacity are just and reasonable and in the public interest,
and that all of the costs incurred by [Rocky Mountaini for purchasing capacity and energy from
CIC are legitimate expenses.’Id.at 3.Rocky Mountain anticipates CIC will achieve its
commercial operation date before its effective date.Id.
STAFF COMMENTS
Staff reviewed the Application and attachments.Staff confirmed that the proposed
rates are correct and that all other terms and conditions in the proposed Agreement are consistent
with prior Commission Orders.Staff therefore recommended the Commission approve all of the
Agreements terms and conditions and declare that all payments made by the Company to CIC to
purchase power will be allowed as prudently incurred expenses for ratemaking purposes.
DISCUSSION AND FINDINGS
The Idaho Public Utilities Commission has jurisdiction over PacifiCorp.an electric
utility,and the issues raised in this matter under the authority and power granted it under Title 61
of the Idaho Code and PURPA.The Commission has authority under PURPA and Federal
Energy Regulatory Commission (FERC)regulations to set avoided costs,to order electric
utilities to enter into fixed-term obligations for the purchase of energy from QFs,and to
implement FERC rules.
The Commission has reviewed the record in this case,including the Application,the
Agreement,and the comments of Commission Staff.We find that CIC is qualified to receive the
non-levelized published avoided cost rates contained in the Agreement.We further find that the
proposed Agreement contains acceptable contract provisions consistent with PURPA,FERC
regulations,and this Commission’s prior Orders.We find it reasonable to allow payments made
under the Agreement as prudently incurred expenses for ratemaking purposes.
ORDER
IT IS HEREBY ORDERED that PacifiCorp’s Application to approve its Power
Purchase Agreement with CIC is approved without change or condition.We further declare that
all payments made by PacifiCorp to CIC for purchases of energy will be allowed as prudently
incurred expenses for ratemaking purposes.
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)
ORDER NO.33405 2
days after any person has petitioned for reconsideration,any other person may cross-petition for
reconsideration.See Idaho Code §6 1-626.
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this
day of October2015.
PA KJELLfN PRESIDENT
MARSHA H.SMITH,COMMISSIONER
J QA
KRIStINE RAPER,COMMISSIONER
ATTEST:
D.JewelIJ
bmmission cecretary
O:PAC-E-1 5-1 1dh2
ORDER NO.33405 3