Idaho Power, Simplot’s Pocatello plant renew contract

The Idaho Public Utilities Commission approved an application on Wednesday by the Idaho Power Company to extend the utility’s energy sales agreement with J.R. Simplot Company’s Pocatello plant for three years.

Idaho Power currently buys output from a cogeneration (combined heat and power) facility at the Pocatello plant, however, the contract was set to expire on Mar. 1. The cogeneration process creates power by drawing from excess heat or steam.

The Pocatello plant is a qualifying facility under the regulations of the Public Utility Regulatory Policies Act (PURPA) of 1978. The federal legislation requires regulated utilities to buy energy from qualifying renewable generation projects at rates published by state commissions. The cost the utility avoids by not having to generate energy itself or buy it from another source is called an “avoided cost rate.” The commission is mandated to ensure the avoided cost rate is reasonable for utility customers because the price utilities pay to qualifying small-power producers is included in customer rates.

The rates under the three-year contract would be $54.39 per megawatt hour in 2016, $55.05 in 2017 and $56.62 in 2018. These rates are adjusted seasonally and for heavy and light load hours.