20170829final_order_no_33860.pdf

Office of the Secretary
Service Date
August 29,2017
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )
FOR APPROVAL OF A POWER PURCHASE )CASE NO.PAC-E-17-08
AGREEMENT BETWEEN PACIFICORP )
AND BRIGHAM YOUNG UNIVERSITY
-)ORDER NO.33860
IDAHO )
On July 12,2017,PacifiCorp dba Rocky Mountain Power (the Company)filed an
Application asking the Commission to approve its renewed Power Purchase Agreement (PPA)
with Brigham Young University —Idaho (BYUI).Under the PPA,BYUI would sell,and the
Company would purchase,electric energy generated from BYUI’s gas/oil fueled generating
facility in Rexburg,Idaho.Staff filed the only written comments and the Company did not file a
reply.The Commission now approves the Application.
BACKGROUND
Under the Public Utility Regulatory Policies Act (PURPA),electric utilities must
purchase electric power from “qualifying facilities”(QFs)at rates approved by the applicable
state regulatory agency —in Idaho,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 QF],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”).
PACIFICORP’S PPA WITH BYUI
The Company and BYUI entered into a renewed PPA under the terms of various
Commission Orders and the federal Public Utility Regulatory Policies Act (PURPA).
Application at 2,citing,Order Nos.32697,32737,32802.The Commission approved the initial
PPA between the Company and BYUI in June 2015,by Order No.33317.Application at 2.The
initial PPA is scheduled to terminate September 27,2017.Id.The Company stated that the
BYUI facility is a QF under PURPA and has a nameplate rating of 5,600 kilowatts (kW),or 5.6
megawatts (MW).Application at 1-2.
BYUI “elected to renew its QF PPA with the Company for a twenty-year term.”Id.
at 4.The Company will pay BYUI “non-levelized,Conforming Energy or Non-conforming
Energy Purchase Prices for Net Output adjusted for the month and On-Peak Hours or Off-Peak
ORDER NO.33860 1
Hours.”Id.The Company and BYUI agreed that should the Facility exceed 5.6 [average
megawatts (aMW)]on a monthly basis.[the Company]xviii accept the energy (Inadvertent
Energy”)that does not exceed the Maximum [Generator Interconnection Agreement]Delivery
Rate,but will not purchase or pay for the Inadvertent Energy.”Id.
The PPA provides that it will not become effective until the Commission has
approved it and determined that the prices to be paid for energy and capacity are just and
reasonable,in the public interest,and that the costs incurred by [the Company]for purchasing
capacity and energy from [BYUI]are legitimate expenses.”Id.Also,the PPA includes
provisions regarding the curtailment or disconnection of BYUJ’s facility from the Company’s
system.The Company asserted that BYUJ knows of these provisions and has accepted them.Id.
at 5.
STAFF COMMENTS
Staff reviewed the Application and attachments and confirmed the proposed rates are
correct and that all other terms in the proposed PPA are consistent with prior Commission
Orders.Staff therefore recommended that the Commission approve all of the PPA’s terms and
declare that all payments made by the Company to BYUI 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
PPA,and the comments of Commission Staff We find that BYUI is qualified to receive the
non-levelized published avoided cost rates contained in the PPA.We further find that the PPA
contains acceptable provisions consistent with PURPA,FERC regulations,and this
Commission’s prior Orders.We find it reasonable to allow payments made under the PPA as
prudently incurred expenses for ratemaking purposes.
ORDER NO.33860 2
ORDER
IT IS HEREBY ORDERED that PacifiCorp’s Application is approved without
change or condition.We further declare that all payments made by PacifiCorp to BYUI 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 §6 1-626.
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this ‘-
day of August 2017.
O:PAC-E-1 7-O8djh2
PAUL KJELI.ANDLR,PRESIDENT
K TINE RAPER,C SIONER
ERIC ANDERSON,COMMISSIONER
Diane M.Hanian
Commission Secretary
ORDER NO.33860 3