20160901final_order_no_33581.pdf

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF PACIFICORP DBA
ROCKY MOUNTAIN POWER'S
APPLICATION TO APPROVE ADDENDUM
TO POWER PURCHASE AGREEMENT
WITH LOWER VALLEY ENERGY, INC.
)
) CASE NO. PAC-E-16-11
)
)
) ORDER NO. 33581
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Office of the Secretary
Service Date
September I, 2016
On July 7, 2016, PacifiCorp dba Rocky Mountain Power (the Company) filed an
Application asking the Commission to approve an Addendum to its Power Purchase Agreement
(PPA) with Lower Valley Energy, Inc. The Addendum extends the PPA, set to expire on
September 30, 2016, for another year. The Commission issued a Notice of Application and
Notice of Modified Procedure setting a 21-day comment period. Commission Staff timely filed
the only written comments. The Company did not file a reply. The Commission now approves
the Application.
BACKGROUND
Under the existing PPA, approved by the Commission in 2014, Lower Valley sells,
and the Company purchases, electric power generated from Lower Valley's three facilities -the
Upper Facility, the Lower Facility, and the Culinary Facility -which are run-of-river
hydroelectric generating facilities in or near Afton, Lincoln County, Wyoming. PPA
(Attachment 2 to Application); Order No. 33107. The facilities -each a separate qualifying
facility under the Public Utility Regulatory Policies Act -are deemed a single generating facility
for purposes of the PP A. Id.
Under the Addendum, the parties agree to extend the term of the PPA for one
additional year, using applicable Idaho rates. 1 Addendum (Attachment 1 to Application). The
applicable rates are the non-levelized2 avoided cost rates for non-seasonal hydro projects less
than 10 average megawatts (aMW), approved by the Commission in December 2015 in Order
No. 33435 (Case No. PAC-E-15-12). For energy deliveries in 2016, the rate is $34.06 per
megawatt-hour (MWh). Application at 3. For energy deliveries in 2017, until the PPA expires
on September 30, the rate is $34.42 per MWh. Id.
1 The Company indicates it will correct an erroneous reference to "Idaho Schedule 37" in its Addendum.
2 The Company filed an errata clarifying that the parties agree to non-levelized, not levelized, avoided cost rates.
ORDER NO. 33581 1
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
Agreement's terms and conditions and declare that all payments made by the Company to Lower
Valley Energy to purchase power be allowed as prudently incurred expenses for ratemaking
purposes.
DISCUSSION AND FINDINGS
The Idaho Public Utilities Commission has jurisdiction over PacifiCorp dba Rocky
Mountain Power, 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 PURP A. The Commission has authority
under PURP A 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
Addendum, and the comments of Commission Staff. We find that Lower Valley Energy is
qualified to receive the non-levelized published avoided cost rates contained in the Addendum.
We further find that the Addendum contains acceptable 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 dba Rocky Mountain Power's
Application to approve the Addendum to its Agreement with Lower Valley Energy is approved
without change or condition. We further declare that all payments made by PacifiCorp to Lower
Valley Energy 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)
days after any person has petitioned for reconsideration, any other person may cross-petition for
reconsideration. See Idaho Code § 61-626.
ORDER NO. 33581 2
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DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this ~ I
day of August 2016.
ERIC ANDERSON, COMMISSIONER
ATTEST:
O:JPC-E-16-l l_djh2
ORDER NO. 33581 3