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The Idaho Public Utilities Commission has ruled that a wind developer is required to pay deposits to Idaho Power Co. if it wants its five Magic Valley area wind projects to remain in line to interconnect with Idaho Power's transmission grid.

Exergy Development Group and Idaho Power had entered into sales agreements that would permit Exergy to sell all the output from five wind projects to Idaho Power. In a complaint filed last July, Exergy claimed Idaho Power was improperly seeking another $255,000 in deposits from the projects as a precondition to providing estimates on how much it will cost Exergy to interconnect with Idaho Power's transmission grid.

Exergy said a requirement for the deposits is not specified in the company's tariff, called Schedule 72, which spells out requirements for interconnecting wind and other small-power projects to Idaho Power's transmission grid.

Idaho Power claimed it needs the deposits before it can proceed with three phases of interconnection cost studies. The utility said it has routinely collected deposits from the more than 200 requests for interconnection it has received since 2000. The deposits are needed, Idaho Power said, to offset engineering and design expense and to protect customers in case a developer decides to abandon its generation project midstream.

Exergy has paid about $45,000 in deposits thus far for the five projects, which include Golden Valley, Milner Dam, Notch Butte, Lava Beds and Salmon Falls.

Exergy said Idaho Power's insistence on the deposits is based on Federal Energy Regulatory Commission (FERC) rules that govern wholesale wheeling of power across state lines and not on the company's own Schedule 72 tariff. Idaho Power says it incorporated the FERC interconnection rules along with Schedule 72 requirements to ensure fair and consistent treatment to all generators and that doing so does not violate state rules.

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