Public Document –Trade Secret Data Has Been Excised
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PUBLIC DOCUMENT –TRADE SECRET DATA HAS BEEN EXCISED 414 Nicollet Mall Minneapolis, MN 55401 November 27, 2013 —Via Electronic Filing— Burl W. Haar Executive Secretary Minnesota Public Utilities Commission 121 7th Place East, Suite 350 St. Paul, MN 55101 RE: PETITION C-BED PURCHASED POWER AGREEMENT WITH ROCK AETNA POWER PARTNERS, LLC DOCKET NO. E002/M-13-____ Dear Dr. Haar: Northern States Power Company, doing business as Xcel Energy, submits to the Minnesota Public Utilities Commission a Petition requesting approval of a Purchased Power Agreement between the Company and Rock Aetna Power Partners, LLC (Rock Aetna). Enclosed is the Non-Public version of our Petition. We are submitting a Public version under separate cover. As a Community-Based Energy Development project, the PPA is subject to a streamlined process under Minn. Stat. § 216B.1612, subd. 7(e), whereby it is deemed approved by the Commission if no party objects within 30 days of its submittal. The Petition and Attachment A contain information marked as trade secret and considered sensitive by Xcel Energy and Rock Aetna. These provisions relate to the pricing and financial components, as well as certain other aspects of the project. Disclosure of these provisions would have a detrimental effect by providing potential suppliers with valuable information not otherwise readily ascertainable and from which these persons would obtain economic value. We have electronically filed this document with the Minnesota Public Utilities Commission, and copies have been served on the parties on the attached service list. If you have any questions regarding this filing, please contact me at [email protected] or (612) 330-6732. Sincerely, /s/ JAMES R. ALDERS STRATEGY CONSULTANT REGULATORY AFFAIRS Enclosures c: Service List PUBLIC DOCUMENT – TRADE SECRET DATA EXCISED STATE OF MINNESOTA BEFORE THE MINNESOTA PUBLIC UTILITIES COMMISSION Beverly Jones Heydinger Chair David Boyd Commissioner Nancy Lange Commissioner J. Dennis O’Brien Commissioner Betsy Wergin Commissioner IN THE MATTER OF THE PETITION OF DOCKET NO. E002/M-13-____ NORTHERN STATES POWER COMPANY FOR APPROVAL OF A C-BED POWER PETITION PURCHASE AGREEMENT WITH ROCK AETNA POWER PARTNERS, LLC INTRODUCTION Northern States Power Company, doing business as Xcel Energy, submits this Petition to the Minnesota Public Utilities Commission seeking approval of a Power Purchase Agreement with Rock Aetna Power Partners, LLC for 20 MW of wind generation under the Company’s C-BED tariff. Rock Aetna Power Partners, LLC will be seeking a determination of C-BED eligibility pursuant to Minn. Stat. §216B.1612, subd. 10.1 A copy of the Rock Aetna PPA is included as Attachment A to this petition. Rock Aetna is a 20 MW wind generation facility to be developed, owned and operated by Rock Aetna Power Partners, LLC. The project will be constructed on a site located in Pipestone County in southwestern Minnesota, with a potential commercial operation date of December 31, 2015. Our analysis of the Rock Aetna C-BED proposal is that it meets the terms of our approved C-BED tariff, is cost-effective, and will save our customers approximately $10 million on a present value basis over the 20 year term of the Agreement. The Company respectfully requests the Commission approve the PPA with Rock Aetna. Pursuant to Minn. Stat. 216B.1612, subd. 7(e), unless a party objects to this PPA within 30 days of this filing, the contract is deemed approved. If approved, the Company will apply the wind energy purchased from Rock Aetna to meet our renewable energy requirement under Minn. Stat. §216B.1691. As a renewable resource used to meet this renewable energy standard, the Company requests approval 1 As discussed more fully below, during the 2010 Legislative Session, amendments were made to Minn. Stat. § 216B.1612. In particular, subd. 10, which allows a developer of a C-BED project to seek pre-determination of C-BED eligibility and requires a determination of C-BED eligibility before construction may begin. PUBLIC DOCUMENT – TRADE SECRET DATA EXCISED to recover the PPA costs through the Company’s Fuel Clause Rider pursuant to Minn. Stat. §216B.1645. The PPA negotiated with Rock Aetna is consistent with Minnesota public policy objectives, in that it will extend the Company’s Renewable Energy Standard compliance, and will help promote locally-owned and operated renewable energy projects – at a reasonable price. Therefore, the project meets the requirements of Minn. Stat. §216B.1612. I. SUMMARY OF FILING A one-paragraph summary is attached to this filing pursuant to Minn. R. 7829.1300, subp. 1. II. SERVICE ON OTHER PARTIES Pursuant to Minn. R. 7829.1300, subp. 2, the Company has served a copy of this filing on the Office of the Attorney General – Antitrust and Utilities Division. A summary of the filing has been served on all parties on the enclosed service list. III. GENERAL FILING INFORMATION Pursuant to Minn. R. 7829.1300, subp. 3, the Company provides the following information. A. Name, Address, and Telephone Number of Utility Northern States Power Company 414 Nicollet Mall Minneapolis, MN 55401 (612) 330-5500 B. Name, Address, and Telephone Number of Utility Attorney Kari L. Valley Assistant General Counsel Xcel Energy 414 Nicollet Mall, 5th Floor Minneapolis, MN 55401 (612) 215-4526 2 PUBLIC DOCUMENT – TRADE SECRET DATA EXCISED C. Date of Filing Xcel Energy submits this Petition on November 27, 2013. The Company requests approval of the PPA as of December 31, 2013, if no objections are received by this date, or upon the date of the Commission Order in the event an objection to this C- BED PPA is received and a standard Commission procedural process must be followed. No change in rates will occur until construction of the project and acceptable delivery of energy under the project begins, which is potentially by December 31, 2015. D. Statute Controlling Schedule for Processing the Filing The Agreement is the result of negotiations under our C-BED tariff established as a result of Minn. Stat. §216B.1612 and approved by the Commission in Docket No. E002/M-07-1527. Specifically, Minn. Stat §216B.1612 subd. 7(e) provides that a utility’s ratepayers have an opportunity to address PPA reasonableness, and if no objection is made within 30 days, the contract is deemed approved. E. Utility Employee Responsible for Filing James R. Alders Strategy Consultant Xcel Energy 414 Nicollet Mall, 7th Floor Minneapolis, MN 55401 (612) 330-6732 IV. MISCELLANEOUS INFORMATION Pursuant to Minn. R. 7829.0700, the Company requests that the following persons be placed on the Commission’s official service list for this proceeding: Kari Valley SaGonna Thompson Assistant General Counsel Records Analyst Xcel Energy Xcel Energy 414 Nicollet Mall, 5th floor 414 Nicollet Mall, 7th Floor Minneapolis, MN 55401 Minneapolis, MN 55401 [email protected] [email protected] Any information requests in this proceeding should be submitted to Ms. Thompson at the Regulatory Records email address above. 3 PUBLIC DOCUMENT – TRADE SECRET DATA EXCISED V. DESCRIPTION AND PURPOSE OF FILING Xcel Energy seeks approval of a Power Purchase Agreement with Rock Aetna Power Partners LLC, which we provide as Attachment A to this Petition. We note that certain provisions of the PPA are non-public, so have been redacted in the Public version of this Petition. The Agreement addresses the power purchase aspect of the transaction with Rock Aetna. However, as a C-BED project, Commission approval is based on a process whereby if no party objects within 30 days of the date of filing, the Agreement is approved pursuant to Minn. Stat. §216B.1612, subd. 7(e). If the PPA is approved, we propose to recover the costs of this project pursuant to Minn. Stat. §216B.1645 through the Fuel Cost Charge of the Fuel Clause Rider, consistent with the recovery method for wind generation projects such as the Rock Aetna project that satisfy the legislative requirements of Minn. Stat. §216B.1691 subd. 2.2 The remainder of this section of our petition provides: • Background information regarding regulatory and statutory treatment of C- BED projects; • Overview of the Rock Aetna wind energy proposal; • Summary of relevant terms of the PPA; • Proposed use of Fuel Clause Riders to recover the cost of purchases; and • Demonstration that the PPA is in the public interest, reasonable and protects customers’ interests. A. Background During the 2005 session, the Minnesota legislature created a new law intended to further facilitate wind development in the state by adopting a set of ownership criteria and pricing guidelines supporting much greater local, regional and state involvement than had been realized in the past. In addition to specifically defining qualifying ownership – examples of which include Minnesota residents, non-profit organizations, school district and tribal councils – Minn. Stat. §216B.1612 specified that the pricing structure may be front end-loaded for the first half of the contract term. A cap on the purchase price of up to 2.7 cents per kilowatt hour on a net present value basis over a 20-year contract life was also included in the statute. In 2007, the Minnesota legislature modified the C-BED statute in a number of ways, including ownership criteria, and removal of the 2.7 cents per kWh price cap. On December 3, 2007, the Company filed for approval of revisions to the Company’s C- 2 Except for those proposed in the Windsource program (Docket No. E-002/M-01-1479). 4 PUBLIC DOCUMENT – TRADE SECRET DATA EXCISED BED tariff in Docket No. E002/M-07-1527 to conform to the 2007 C-BED statutory changes, which the Commission approved in its September 5, 2008 Order. In 2010, the Minnesota legislature further modified the C-BED statute by: (1) allowing a legal entity to qualify as a C-BED beneficiary under certain circumstances when formed for a purpose other than to participate in C-BED projects; (2) clarifying the definition of qualifying revenue in determining whether a project is eligible for C- BED status; and (3) clarifying the process and the requirements a C-BED project shall follow in seeking a pre-determination of C-BED eligibility from the Minnesota Commissioner of Commerce.