IDAHO PUBLIC UTILITIES COMMISSION

Case Nos. IPC-E-05-30, -31, -32, -33

January 11, 2006

Contact: Gene Fadness (208) 334-0339

Website: www.puc.idaho.gov

 

IPUC approves Idaho Power sales agreements with four wind projects

 

State regulators have approved Idaho Power Co. sales agreements with the developer of four wind parks scheduled to be built in south-central and eastern Idaho.

 

The developer of all four projects is James Carkulis of the Montana-based Exergy Development Group. All four projects, if approved, would start producing energy in November 2006, and be in full operation by May 2007.

 

The four projects, all of which will be paid for delivery of 10 average-megawatts a month to Idaho Power, include:

 

Milner Dam Wind Park (IPC-E-05-30) – Located about a mile west of Milner Dam (west of Burley) in Cassia County, this project includes 12, 1.5-megawatt turbines.

 

Lava Beds Wind Park (IPC-E-05-31) – Located between Blackfoot and Arco, this project is also 12, 1.5-MW turbines.

 

Notch Butte Wind Park (IPC-E-05-32) – Located between Twin Falls and Shoshone, this project is also 12, 1.5-MW turbines.

 

Salmon Falls Wind Park (IPC-E-05-33) – Located near Hagerman and south of Bell Rapids, this project includes 14, 1.5-MW turbines.

 

The Idaho Public Utilities Commission agreed with Idaho Power’s contention that the projects were sufficiently far enough along in development that they should be grandfathered from a commission order in August that temporarily reduced – from 10 average megawatts to 100 kilowatts – the size of projects that could qualify for a rate published by the commission for renewable projects under provisions of federal PURPA legislation.

 

Congress passed PURPA, the Public Utility Regulatory Policies Act, during the energy crisis of the late 1970s. Its purpose is to encourage development of renewable energy technologies as alternatives to burning fossil fuels or constructing new power plants. The federal act requires that electric utilities offer to buy power produced by small power producers or co-generators who obtain Qualifying Facility (QF) status. The published rate to be paid project developers is set by state commissions and is to be equal to the cost the electric utility avoids if it would have had to generate the power itself or purchase it from another source.

 

Windland Inc., developers of the Cotterel Mountain Wind Farm east of Burley, filed comments in the case asking that approval be delayed until the commission gets financial assurance, such as a performance bond, that the projects will be completed on their scheduled completion dates. Windland claims Exergy has been late in meeting target dates for other projects. Such delays, Windland contends, could cost ratepayers because Idaho Power would then have to procure alternate wind sources at a higher cost due to the expiration of a federal production tax credit for wind at the end of 2007.

 

The commission said that while there may be a risk that the projects are not completed in a timely fashion, the risk is small. Idaho Power’s planning process is flexible enough to accommodate the risk associated with PURPA projects, the commission said. “We have no developed record of upfront project failure to justify the imposition of a performance bond requirement,” the commission said.

 

 A full text of the commission’s order, along with other documents related to this case, are available on the commission’s Web site at www.puc.idaho.gov. Click on “File Room” and then on “Electric Cases” and scroll down to Case Nos. IPC-E-05-30, -31, -32 and -33.