170829 IPC battery storage reconsideration.pdf

Case No. IPC-E-17-01, Order No. 33785
Contact: Matt Evans, [phone] or [phone]
www.puc.idaho.gov
State regulators deny petition to
reconsider ruling on battery storage
projects
BOISE (Aug. 29, 2017) – State regulators have denied a request to reverse their decision
regarding the contract terms for several proposed PURPA battery storage projects in
southern Idaho.
The Idaho Public Utilities Commission said Franklin Energy’s petition for reconsideration
failed to show that its final order was “unreasonable, unlawful, erroneous or not in
conformity with the law.”
The Public Utility Regulatory Policies Act, or PURPA, requires electric utilities to purchase
energy from qualifying independent power producers but gives state regulators authority
to determine the contract terms for PURPA-eligible facilities.
In Idaho, PURPA facilities larger than 100 kilowatts, or 0.1 megawatts, that are powered by
intermittent sources such as solar and wind are eligible for two-year contracts at a rate
negotiated between the utility and the developer (IRP methodology).
Franklin’s plans call for the construction of four battery storage facilities to be located in
Twin Falls County. The batteries would be charged with energy from nearby solar projects
capable of generating 2.5 average megawatts, and the electricity dispatched to Idaho Power
under the provisions of PURPA.
Franklin contended that its projects should qualify for 20-year contracts at the published
rate set by the Commission.
Idaho Power said the projects, and energy storage projects in general, were eligible for
two-year, negotiated PURPA contracts, and asked the Commission to intervene.
In determining the projects were eligible for two-year contracts, the Commission relied on
a 1990 order by the Federal Energy Regulatory Commission, which implements PURPA.
In Luz Development and Finance Corporation, FERC said energy storage facilities are not per
se small power producers as contemplated by PURPA, and that a facility’s primary energy
source must be considered.
Since Franklin’s facilities would utilize solar as their primary energy source, the
Commission determined that they would be eligible for two year, negotiated contracts.
In its petition for reconsideration, Franklin claimed the Commission’s decision was “fatally
flawed.”
Franklin contended the Commission made a determination about the battery storage
projects’ status as a qualifying facility (QF) under PURPA. Such a determination exceeds the
Commission’s authority and is therefore unlawful, Franklin said.
In rejecting the company’s reconsideration petition, the Commission noted that its ruling
explicitly states that Franklin’s projects’ QF status is “a matter within FERC’s jurisdiction”
and that the projects’ QF status was never in question.
The Commission also emphasized that state commissions have broad discretion and
authority in establishing the terms and conditions of PURPA contracts.
“Franklin’s mischaracterization of our Final Order is a frivolous effort to contrive a legal
basis for reconsideration,” the Commission said.
A petition for reconsideration allows any party to contest a Commission order. Once an
order on reconsideration is issued, the Commission’s decision can be appealed directly to
the Idaho Supreme Court.
The Commission’s order and other documents related to the case can be found at
www.puc.idaho.gov. Under the “Electric” heading, click on “Open Cases,” and scroll down to
Case No. IPC-E-17-01.