FOR IMMEDIATE RELEASE

Idaho Public Utilities Commission

January 13, 2011

Case Nos. IPC-E-10-47, -48, -49, -50, Order No. 32154

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

Sales agreements with four wind projects proposed

Idaho Power Company is asking the Idaho Public Utilities Commission to accept or reject proposed sales agreements with the developer of four wind farms in the Rogerson area. The commission is accepting written comment on the sales agreements through Jan. 31. The developer for all the projects is James Carkulis of Boise-based Exergy Development.

All four projects are proposed for acceptance under the provisions of the federal Public Utilities Regulatory Policies Act, or PURPA. Idaho Power said it is complying with its PURPA mandate to accept power generated from qualifying renewable facilities but, at the same time, states that the “continuing and unchecked requirement” for the company to acquire additional intermittent generation regardless of the utility’s need for additional energy “increases the price its customers must pay for their energy needs.” Idaho Power also stated that the PURPA requirement is circumventing its planning process and creating system reliability and operational issues.

PURPA was passed by Congress in 1978 to encourage development of renewable energy technologies as alternatives to burning fossil fuels or building new power plants. The act requires that electric utilities offer to buy power produced from qualifying small-power producers at rates determined by the states. The rate to be paid small-power developers, called an avoided-cost rate, 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.

Last November, Idaho Power, along with two other regulated electric utilities operating in Idaho, asked the commission to immediately reduce the size of projects eligible for posted PURPA rates from the current 10 megawatts or 100 kilowatts. All four of the proposed Rogerson wind projects would deliver up to 10 average megawatts per month under the proposed agreements. However, the agreements also state that Idaho Power can curtail generation from the projects without compensation to the developer under certain conditions. Those conditions include times when generation on Idaho Power’s total system approaches minimum levels needed to serve customers and further acceptance of the wind would have a detrimental effect on the utility’s ability to simultaneously manage the generation also coming from thermal, hydro and other resources. Idaho Power maintains it now has 208 MW of wind generation and another 264 MW of approved wind contracts were scheduled to be online by the end of 2010. The utility claims it could have 1,100 MW of wind generation on its system in the near term, which exceeds the amount of power used in its total system on the lightest energy-use days.

The rate proposed for the four projects is a non-levelized rate that increases through the 20-year life of the contract. The scheduled operation date for the projects is June 30, 2012. In 2012, the agreement’s proposed rate for normal load hours during normal seasons of the year is $58.68 per megawatt-hour, escalating to $117.77 per MWh in 2031. The rate varies to account for heavy and light load hours of the day and heavy and light load seasons of the year. 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.

Comments are accepted through Jan. 31 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-10-47, -48, -49 and -50) and enter your comments. Comments can also be mailed to P.O. Box 83720, Boise, ID 83720-0074 or faxed to (208) 334-3762. The company can file reply comments by no later than Feb. 2.

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.