Smith Creek Hydro readies for power sales out of to-be-purchased facility in Idaho

Smith Creek Hydro LLC, which plans to buy a hydroelectric plant in Idaho, on Feb. 5 filed with the Federal Energy Regulatory Commission an application for an order accepting its proposed market-based rate tariff and granting blanket authorization for it to make sales of electric energy, capacity, and ancillary services at market-based rates.

The company was formed to acquire, own and operate the 37.8-MW (net) Smith Creek Hydroelectric Facility and associated interconnection equipment located in Boundary County, Idaho. Subject to the receipt of all necessary regulatory approvals, Smith Creek Hydro will acquire the facility from the Eugene Water & Electric Board (EWEB) under an Asset Sales Agreement dated Dec. 1, 2015, with an expected closing date of April 1, 2016.

Smith Creek Hydro will sell the entire electrical output of the facility to EWEB for an initial period of three years under a power purchase agreement that was entered into in conjunction with the closing of the transaction. In the future, Smith Creek Hydro intends to sell the entire electrical output to an unaffiliated, third-party, long-term off-taker under a power purchase agreement at a price agreed to after arm’s length negotiations.

This facility is interconnected to the transmission system and balancing authority area of the Bonneville Power Administration (BPA). The planned transaction includes the sale by EWEB and purchase by applicant of the 30.5-mile, 115-kV transmission line used to interconnect the facility to the BPA system (called the “Smith Creek Project Line”).

In addition to connecting this hydro facility to the BPA transmission grid, EWEB currently allows Northern Lights Inc., an Idaho cooperative association, to use the Smith Creek Project Line under a Power Transfer Agreement dated January 2000. The Power Transfer Agreement permits Northern Lights to utilize the Smith Creek Project Line to transfer power from the BPA Bonners Ferry substation back up to a tie-in point along the Smith Creek Project Line (short of the hydro project itself). Northern Lights takes its power off the Smith Creek Project Line at this tie-in and distributes the power to a small group of retail customers using distribution lines and other equipment owned by Northern Lights.

As part of this transaction, Smith Creek Hydro is assuming EWEB’s rights and responsibilities under the Power Transfer Agreement for its remaining term, through Jan. 1, 2020. 

Smith Creek Hydro is a joint venture owned 25% by Smith Creek Management LLC and 75% by Smith Creek Holdings Inc.

  • Smith Creek Holdings is a wholly owned subsidiary of JAVA Hydro Electric Inc., which is in turn a wholly owned subsidiary of JAVA Holdings Ltd., a company formed under the laws of Alberta, Canada. JAVA Holdings is wholly-owned by 1428802 Alberta Ltd., a company formed under the laws of Alberta. 1428802 Alberta Ltd. is wholly-owned by the Budzinski Family Trust of which Victor Budzinski is the sole trustee.
  • Smith Creek Management is majority-owned and controlled by Thom Fischer, owning 90%, with the minority owner, Steve Marmon, owning the remaining 10%.

Thom Fischer is the sole owner of Tollhouse Energy Co., which is a private, Washington-based corporation engaged in the development, ownership, and operation of green, environmentally friendly, renewable energy projects. Currently, Tollhouse is developing projects within the states of Washington and Montana. Examples of the hydroelectric projects developed, redeveloped, or otherwise operated by Tollhouse and its affiliates are:

  • Black Canyon Hydro LLC holds a FERC-issued preliminary permit for the Black Canyon Hydroelectric Project. Black Canyon is owned 33% by Tollhouse, 33% by Thom Fischer as an individual and 33% by Steve Marmon as an individual. The Black Canyon Project has a nameplate capacity of 25 MW and is located in the Puget Sound Energy (PSE) BAA.
  • Gibson Dam Hydroelectric Co. LLC holds a FERC original license for the Gibson Dam Hydroelectric Project. Gibson is owned 50% by Tollhouse and 50% by Greenfield Irrigation District. The Gibson Dam Project has a nameplate capacity of 15 MW and is located in the Western Area Power Administration BAA. Gibson is in the process of obtaining approvals from various government agencies for the construction of the Gibson Dam Project and related transmission infrastructure. Gibson has not begun construction on the Gibson Dam Project and at this point there is no definitive timeline to begin or complete construction.
  • Electron Hydro LLC owns and operates the Electron Hydroelectric Project. Electron Hydro is owned 25% by Electron Management LLC and 75% by Electron Holdings Inc. Electron Holdings is a wholly owned subsidiary of JAVA, which, as noted above, is in turn a wholly owned subsidiary of JAVA Holdings. Electron Management is 90% owned by Thom Fischer and the remaining 10% is owned by Steve Marmon. The Electron Hydro Project has a nameplate capacity of 25.8 MW and is located in Pierce County, Washington. The commission has acknowledged that the Electron Hydro Project is exempt from the commission’s hydropower licensing jurisdiction.
  • Black Creek Hydro Inc. owns and operates the 3.8-MW Black Creek Hydroelectric Project. Black Creek is wholly owned by Valtec Power LLC. Valtec Power LLC is 45% owned by Tollhouse and 55% owned by JAVA Holdings. The Black Creek Project is a small power production QF in King County, Washington, in the PSE BAA.
About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.