Idaho Power is seeking a sales agreement with the developer of a 20-megawatt photovoltaic solar project located on 180 acres 16 miles west of Mountain Home.
Idaho Power is asking that the state regulatory commission approve a 20-year sales agreement between the two companies. The manager of the Grand View Solar PV One project is Robert Paul of Desert Hot Springs, Calif., who is looking to sell the power from the development.
Idaho Power has a number of net metering agreements with producers that own small primarily residential solar projects, but this project is the first sales agreement with a larger provider, the commission said in a release.
A hearing with the Idaho Public Utilities Commission is required and the PUC is taking comments through Aug. 19 on Idaho Power Co.’s first-ever proposed agreement with a solar power project under the federal Public Utility Regulatory Policies Act (PURPA) of 1978.
The project, with a scheduled on-line date of Jan. 1, 2011, is a qualifying facility under the provisions of PURPA, which requires electric utilities to offer to buy power produced by qualifying small power producers or co-generators. The rate to be paid PURPA 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.
Declining natural gas prices and a new price forecast by the Northwest Power and Conservation Council led to the commission to lower the avoided cost rate paid power developers on March 16. However, Idaho Power claims the sales agreement with this project was “materially complete” before March 16 and, except for routine final processing, would have been signed by both parties by that date, the commission said. For that reason, Idaho Power claims the project meets the grandfathering criteria established by the commission that allows projects to be priced at a former rate.
The proposed 20-year agreement is a non-levelized agreement, meaning the price for the electricity generated gradually increases through the life of the contract. The rate, under the proposed contract is $77.77 per megawatt-hour in 2011 escalating to $128.31 per megawatt hour in 2031. That rate is adjusted for heavy- and light-load seasons as well as heavy- and light-load hours. The planned monthly output for the project varies from 1,326 megawatt-hours in January to 4,816 megawatt-hours in July.
Even though project capacity is 20 megawatts, the project is not expected to exceed 10 average megawatts on a monthly basis, the commission said. Should the project exceed 10 average megawatts, Idaho Power will accept the energy but will not be required to pay for it. Idaho caps the size of projects that can qualify for the published avoided-cost rate at 10 megawatts.
The developer is also required to allow the Idaho Power to complete a study on how the project will interconnect with the utility’s transmission grid.
Comments should be directed to the commission at P.O. Box 83720, Boise, Idaho 83720. Comments also can be faxed to (208) 334-3762, or entered on the commission’s Web site. The Case is No. IPC-E-10-19.