Idaho Public Utilities Commission
Case No. IPC-E-11-26, Order No. 32462
February 24, 2012
Contact: Gene Fadness (208) 334-0339, 890-2712
Commission approves Idaho Power agreement with wind project
The Idaho Public Utilities Commission has approved a 20-year sales agreement with High Mesa Energy LLC, a 40-megawatt wind project near Bliss. High Energy, based in West Des Moines, Iowa, states the project will be operating by Dec. 28 of this year.
The developer will be paid a 20-year levelized price of $56.43 per megawatt-hour, though the pricing stream varies based on the time of year and the time of day that energy is delivered to Idaho Power. The agreement also states that the value of the Renewable Energy Certificates generated over the 20-year contract will be shared equally by the developer and Idaho Power.
The project is a qualifying facility under the provisions of the Public Utility Regulatory Policies Act. PURPA requires that electric utilities offer to buy power produced from qualifying small power producers or cogenerators. The rate was negotiated between Idaho Power and the developer using the company’s long-range growth plan as a basis. The rate to be paid small-power producers is to be equal to the cost the 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 cost is included in customer rates.
Commission staff calculated a lower avoided-cost – about $3 per MWh lower or 5 percent – than that agreed upon by Idaho Power and High Mesa, and, thus, recommended denial of the project. However, the commission said the agreement contains “acceptable contract provisions,” and should be approved.
Both commission staff and the commission acknowledged that the negotiated IRP methodology is relatively new and that many of the issues related to computing an accurate avoided cost for PURPA projects are being considered in another case now before the commission (GNR-E-11-03). “We expect to see the IRP methodology issues addressed by staff argued more fully and to conclusion in the generic PURPCA docket currently before the commission,” the commission said.
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-11-26.
Interested parties may petition the commission for reconsideration by no later than March 9. Petitions for reconsideration must set forth specifically why the petitioner contends that the order is unreasonable, unlawful or erroneous. Petitions should include a statement of the nature and quantity of evidence the petitioner will offer if reconsideration is granted. Petitions can be delivered to the commission at 472 W. Washington St. in Boise, mailed to P.O. Box 83720, Boise, ID, 83720-0074, or faxed to 208-334-3762.