Developers of two Idaho wind farms seek approval from state regulators to sell power to Oregon customers at Oregon rates, but Idaho Power says developers trying to 'manipulate and avoid' Idaho's rates, rules

Rachel Carter

BOISE, Idaho , August 23, 2011 (press release) – Idaho Power Company is asking state regulators to assert jurisdiction over two Idaho-based wind projects that want to sell their output in Oregon to qualify for that state’s published rates.

The two projects, Tumbleweed Energy II in Elmore County and Western Desert Energy I in Owyhee County, seek Idaho Power’s approval of a PURPA* contract to sell to Idaho Power’s Oregon customers at Oregon rates. The Idaho Public Utilities Commission recently reduced the size of projects that can qualify for published rates from 10 megawatts to 100 kilowatts. Oregon’s published rate eligibility cap is 10 MW. The Tumbleweed project is 10 MW and the Western Desert project is 5 MW.

Idaho Power claims the Boise-based developer of both projects is attempting to “cherry pick” a different jurisdiction’s rates for its Idaho projects. “This is a blatant attempt to manipulate and avoid the Idaho commission’s rates, rules and regulations that are designed to implement PURPA and protect Idaho Power’s customers,” the company states in its petition to the commission.

Western Desert was one of the published avoided-cost rate contracts that were recently rejected by the commission because it was not approved before the Dec. 14, 2010 date that the lower eligibility cap of 100 kW was implemented.

The developers argue that the commission is prohibited by federal law from regulating qualifying PURPA projects and does not have authority to restrict the projects’ access to markets. Doing so, the developers argue, would violate the Commerce Clause of the U.S. Constitution by restricting the projects’ access to markets outside Idaho.

The commission is taking comments on Idaho Power’s application through Sept. 8. Comments are accepted via e-mail by accessing the commission’s homepage at www.puc.idaho.gov and clicking on "Comments & Questions About a Case." Fill in the case number (IPC-E-11-14) and enter your comments. Comments can also be mailed to P.O. Box 83720, Boise, ID 83720-0074 or faxed to (208) 334-3762.

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 the above case number.

* Passed by Congress during the energy crisis of the late 1970s, PURPA (the Public Utilities Regulatory Policy Act) encourages 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 cogenerators who obtain Qualifying Facility (QF) status. The rate to be paid to project developers is to be equal to the cost the electric utility avoids if it would have had to generate the power itself or buy it from another source.

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