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Utilities commission says wind developer must pay deposits
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A wind developer must pay deposits to Idaho Power Co. if it wants its five Magic Valley area wind projects to remain in line to interconnect with Idaho Power’s transmission grid, the Idaho Public Utilities Commission has ruled.
Exergy Development Group and Idaho Power entered into sales agreements that will permit Exergy to sell all output from five wind projects to Idaho Power. In a complaint filed last July, Exergy claimed Idaho Power was improperly seeking another $255,000 in deposits from the projects as a precondition to providing estimates on how much it will cost Exergy to interconnect with Idaho Power’s transmission grid.
Exergy said a requirement for the deposits is not specified in the company’s tariff, called Schedule 72, which spells out requirements for interconnecting wind and other small-power projects to Idaho Power’s transmission grid, according to a release from the commission.
Idaho Power claimed it needs the deposits before it can proceed with three phases of interconnection cost studies. The utility said it has routinely collected deposits from the more than 200 requests for interconnection it has received since 2000. The deposits are needed, Idaho Power said, to offset engineering and design expense and to protect customers in case a developer decides to abandon its generation project midstream.
Exergy has paid about $45,000 in deposits thus far for the five projects, which include Golden Valley, Milner Dam, Notch Butte, Lava Beds and Salmon Falls, the commission said.
Exergy said Idaho Power’s insistence on the deposits is based on Federal Energy Regulatory Commission rules that govern wholesale wheeling of power across state lines and not on the company’s own Schedule 72 tariff. Idaho Power said it incorporated the interconnection rules along with Schedule 72 requirements to ensure fair and consistent treatment to all generators and that doing so does not violate state rules.
The commission ruled Idaho Power’s use of the federal rules as an internal template for small-power interconnection requests is not inconsistent with Schedule 72. The commission said the Federal Energy Regulatory Commission process encourages renewable development because small-power generators are able to make deposits incrementally as the interconnection studies proceed rather than having to pay the full amount upfront.
But the state utility commission also said Idaho Power should propose additional language to Schedule 72 that describes in detail the three-step study process to ensure “greater transparency in its interconnection processes,” the commission’s release said.
By Brad Carlson
6 February 2008
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