Articles Posted in Energy, Oil & Gas Law

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In 2010, Idaho Power entered into two Firm Energy Sales Agreements, one with New Energy Two, LLC, and the other with New Energy Three, LLC, under which Idaho Power agreed to purchase electricity from them that was to be generated by the use of biogas. The agreement with New Energy Two stated that the project would be operational on October 1, 2012, and the agreement with New Energy Three stated that the project would be operational on December 1, 2012. Both contracts were submitted for approval to the Idaho Public Utilities Commission, and were both approved on July 1, 2010. Each of the agreements contained a force majeure clause. By written notice, New Energy Two and New Energy Three informed Idaho Power that they were claiming the occurrence of a force majeure event, which was ongoing proceedings before the Public Utilities Commission. New Energy asserted that until those proceedings were finally resolved "the entire circumstance of continued viability of all renewable energy projects in Idaho is undecided"and that as a consequence "renewable energy project lenders are unwilling to lend in Idaho pending the outcome of these proceedings."Idaho Power filed petitions with the Commission against New Energy Two and New Energy Three seeking declaratory judgments that no force majeure event, as that term was defined in the agreements, had occurred and that Idaho Power could terminate both agreements for the failure of the projects to be operational by the specified dates. New Energy filed a motion to dismiss both petitions on the ground that the Commission lacked subject matter jurisdiction to interpret or enforce contracts. After briefing from both parties, the Commission denied New Energy's motion to dismiss. The Commission's order was an interlocutory order that is not appealable as a matter of right. New Energy filed a motion with the Supreme Court requesting a permissive appeal pursuant to Idaho Appellate Rule 12, and the Court granted the motion. New Energy then appealed. Finding no reversible error, the Supreme Court affirmed the Commission's order. View "Idaho Power v. New Energy Two" on Justia Law

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The issue this case presented for the Supreme Court's review was an order of the Idaho Public Utilities Commission holding that it had jurisdiction to decide whether the force majeure clauses in the Appellants' contracts with Idaho Power Company excused them from their contractual obligations to have their power generation facilities constructed and in operation by specified dates in order to sell electricity to Idaho Power. Finding no reversible error, the Supreme Court affirmed the Commission. View "Idaho Power v. New Energy Two & IPUC" on Justia Law

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Ida-Therm, LLC appealed the grant of summary judgment in favor of Bedrock Geothermal, LLC, which held that a reservation of "all the oil, gas, and minerals, in, on, or under the surface of [deeded] lands," in a 1946 warranty deed included the geothermal resources underlying the property. The district court determined that the Deed's mineral reservation severed the mineral estate from the surface estate, and that geothermal resources were included in the scope of the mineral estate. Because the Supreme Court found that the term "mineral" was ambiguous with respect to the deed in question, and because ambiguous grants in deeds are construed against the grantor, the Court construed the grant in favor of Ida-Therm and reversed the district court. View "Ida-Therm v. Bedrock Geothermal" on Justia Law

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This appeal arose from a negligence action brought by Plaintiff-Appellant Isabel Enriquez against Defendant-Respondent Idaho Power Company (Idaho Power). Plaintiff received severe electrical burns when he encountered an aluminum sprinkler pipe that had become energized by a high-voltage power line. He claimed that after the power line broke and electrified the pipe, Idaho Power's safety equipment did not shut off the current to the downed line, allowing him to be shocked when he approached the pipe to move it. The case went to trial, and Plaintiff argued that Idaho Power was negligent under the doctrine of res ipsa loquitur. At the close of Plaintiff's case in chief, Idaho Power moved for a directed verdict. The district court determined that res ipsa loquitur did not apply to the facts of this case and granted the motion. On appeal, Plaintiff argued that the district court erred in holding that res ipsa loquitur did not apply and the directed verdict was therefore improper. Upon review of the trial court record, the Supreme Court concluded the trial court did not abuse its discretion when it granted a directed verdict in favor of the power company. Accordingly, the Court affirmed the trial court's decision. View "Enriquez v. Idaho Power Co." on Justia Law

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Defendants-Appellants Stanley and Catherine Jensen, as trustees of the Stanley and Catherine Jensen Family Living Trust, appealed the district court's decision that granted Plaintiff-Respondent Rocky Mountain Power's motion for summary judgment. Defendants are record owners of a cattle ranch that lies within a corridor established by the Utility for a 345 kilovolt transmission line. The Utility sought a perpetual easement and a right of way for the Utility and its successors and assigns to locate, construct, reconstruct, operate, and maintain a 150 foot wide high-voltage overhead power line utility corridor through the eastern part of Defendants' property. In 2008, Defendants entered into an Occupancy Agreement with the Utility, waiving all defenses to the Utility's acquisition of the easement, except the claim of just compensation. Upon execution of the Agreement, Defendants were paid $215,630 which would be deducted from any final determination of just compensation for the easement. Under the terms of the Occupancy Agreement, if just compensation was determined to be less than $215,630, Defendants were not required to return the difference. The parties were unable to reach an agreement for just compensation within a specified time, so the Utility filed its Complaint in early 2009, seeking a decree of condemnation, an award of easement, and specific performance of the Occupancy Agreement. The Utility filed a motion for summary judgment, contending that Defendants did not identify any expert witnesses or laid a proper foundation for any probative evidence of just compensation. Upon review, the Supreme Court found that Defendants failed to establish a genuine issue of material fact to establish the fair market value of their property. Accordingly, the Court affirmed the district court's judgment. View "Rocky Mountain Power v. Jensen" on Justia Law

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The Idaho Department of Water Resources (Department) appealed an order of the district court that required it to strike a term from a hydropower water right license issued to the Idaho Power Company. In 1984, an agreement was entered into between Idaho Power, the State, the governor, and the attorney general, in an effort to resolve a controversy associated with the company's water rights at the Swan Falls Dam. As part of the Swan Falls agreement, the parties agreed to support legislation for the commencement of an adjudication of water rights in the Snake River Basin. One key piece of the legislation that was passed pursuant to the Swan Falls Agreement gave the Department specific authority to subordinate hydropower rights in a permit or license to the rights of subsequent upstream depletionary users. The Department was also authorized to limit a permit or license involving hydropower to a term of years. The Department issued a final order that articulated the legal basis for including the "term of years" condition in the license to Idaho Power. The Company sought judicial review of the Department's final order, arguing that the Department did not have statutory authority to include a term condition in its license. The court indeed concluded that the Department did not have the authority to limit the license. The Department appealed to the Supreme Court. Upon review, the Supreme Court found that the Department had the statutory authority to include a term condition in Idaho Power's license. The Court reversed the district court's decision. View "Idaho Power Company v. Idaho Dept of Water Resources" on Justia Law

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In October 2008, the Idaho Power Company filed an application with the Idaho Public Utilities Commission (IPUC) to modify its tariff. Some of the proposed amendments applied to the relocation of utilities facilities within public rights-of-way. The City of Nampa and the Association of Canyon County Highway Districts intervened in the proceedings, and each objected to the Company’s proposed amendments to the tariff. The IPUC approved the amendments, and Ada County Highway District (ACHD) filed a petition or reconsideration and clarification. Specifically, ACHD argued that the IPUC exceeded its authority in approving the amendments and that portions of the amended tariff were “an unlawful attempt to amend or abrogate the common law rule requiring a utility to relocate its facilities placed in a public right-of-way at its expense.” Upon review, the Supreme Court found that the IPUC exceeded its authority in determining utilities relocation within public rights-of-way. The Court set aside the amended tariff. View "Ada County Highway Dist. v. Idaho Public Utilities Comm’n " on Justia Law

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In October 2008, the Idaho Power Company (Company) filed an application with the Idaho Public Utilities Commission (IPUC) seeking to modify its “line extension” tariff that applied to requests for electrical service that required the installation, alteration, relocation, removal or attachment of company-owned distribution facilities. As homes are constructed in a subdivision, the homeowner requests to be connected to power, and the Company installs wiring from a transformer to the house at no cost to the homeowner. The cost of constructing new distribution facilities had been paid partially from up-front capital contributions from developers, and partially from electric rates charged to all customers. Under the old tariff, the Company gave developers a “line installation allowance” to offset a portion of the developers’ costs in having the Company construct distribution facilities. The allowance was equal to the Company’s cost of providing and installing transformers within the subdivision. Per-lot refunds were refunded to the developer when a permanent residence connected to electrical service and occupied a lot within five years. The per-lot refunds could be as much as $800 each. In this proceeding, the Company sought to change line installation allowances to fixed sums. It also wanted to eliminate the per-lot refunds. The Building Contractors Association of Southwestern Idaho filed a petition to intervene in the proceeding. The Contractors sought to increase per-lot refunds. The IPUC granted the Company’s request to change the line extension allowance to a fixed sum. The Contractors asked the IPUC to reconsider tariff change, but the IPUC denied the request. On appeal to the Supreme Court, the Contractors challenged the sufficiency of the evidence presented by the Power Company to support the tariff change. Finding the evidence sufficient to support the IPUC’s decision, the Supreme Court affirmed the IPUC’s decision to change the power company’s tariff. View "Building Contractors Association of Southwestern Idaho v. Idaho Public Utilities Comm’n " on Justia Law