Idaho Public Utilities Commission

February 18, 2011

Case No. IPC-E-10-45, Order No. 32181

Contact: Gene Fadness (208) 334-0339, 890-2712

Idaho Power renews agreement with Jerome area hydro project

The Idaho Public Utilities Commission has approved an Idaho Power Company agreement to buy power from the 8.1-megawatt Hazelton A Hydroelectric Project near Jerome. The project is already constructed and generating power. Its developer, SE Hazelton of Andover, Mass., has had an agreement with Idaho Power since 1989. That agreement expired on Dec. 31, 2010.

Even though the facility will continue to use its existing interconnection and transmission facilities and capacity, Idaho Power will require completion of a Generator Interconnection Agreement and Transmission Service Requests in order to bring the facility up to date with Idaho Power’s current tariffs and processes.

The project is a Qualified Facility under the provisions of the federal Public Utility Regulatory Policies Act (PURPA) passed by Congress during the energy crisis of the late 1970s. PURPA requires electric utilities to offer to energy produced by small-power producers who obtain Qualifying Facility (QF) status. The rate to be paid project developers, called an “avoided cost rate,” is determined and published by state commissions. The avoided cost rate 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. The commission must ensure the avoided-cost rate is reasonable for utility customers because 100 percent of the price utilities pay to qualifying producers is included in customer rates.

The agreement is for 15 years beginning Jan. 1, 2011. In 2011, the agreement’s rate for normal load hours during normal seasons of the year is $60.06 per megawatt-hour, escalating to $103.76 per MWh in 2025. The rate varies to account for heavy and light load hours of the day and heavy and light load seasons of the year.

A full text of the commission’s order, along with other documents related to this case, is 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 No. IPC-E-10-45.