Idaho Power asked the Idaho Public Utilities Commission on Jan. 24 for an order approving a confidential settlement agreement between it and Grand View Solar One PV LLC, worked out after Grand View Solar One failed to meet a deadline to get a 10-MW power project in operation.
In June 2010, Idaho Power and Grand View Solar One entered into a Firm Energy Sales Agreement (FESA) under the Public Utility Regulatory Policies Act of 1978 (PURPA), which provided that Grand View Solar One would construct, maintain, and operate a photovoltaic solar electric facility and that Idaho Power will buy electric energy produced by the facility. In September 2010, the Idaho commission approved the FESA.
In April 2012, Idaho Power and Grand View Solar One executed a letter of understanding and agreement that addressed a potential default of the FESA, established a required operation date of Jan. 12, 2013, required posting of $810,000 security by Grand View Solar One, and provided that Idaho Power would terminate the FESA and collect damages of $810,000 if Grand View One did not achieve the Jan. 12, 2013, deadline. The commission approved this agreement, as well.
“On January 9, 2013, Grand View One contacted Idaho Power and advised that the Grand View One project would not be on-line by the required Operation Date of January 12, 2013, and requested to voluntarily terminate the FESA prior to the January 12, 2013, date,” Idaho Power told the commission. “A voluntary termination of an existing FESA, prior to a default or material breach of the FESA, is not specifically contemplated in the FESA. Various provisions within the FESA are triggered once a project misses its Operation Date or is otherwise in material breach of the agreement. However, the FESA terms and conditions do not specifically address a voluntary termination initiated by the project prior to the Operation Date.”
On Jan. 11, Idaho Power and Grand View Solar One executed a confidential settlement agreement that provides for the immediate termination of the FESA, the collection of damages, and the disposition of the project’s delay security held by Idaho Power.