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HomeMy WebLinkAbout20250207Application.pdf _ ROCKY MOUNTAIN 1407 W.North Temple,Suite 330 POWER. Salt Lake City,UT 84116 A DIVISION OF PACIFICORP RECEIVED 2025 February 7 February 7, 2025 IDAHO PUBLIC UTILITIES COMMISSION VIA ELECTRONIC DELIVERY Commission Secretary Idaho Public Utilities Commission 11331 W. Chinden Blvd Building 8 Suite 201A Boise, ID 83714 RE: CASE NO.PAC-E-25-02 IN THE MATTER OF THE APPLICATION OF ROCKY MOUNTAIN POWER FOR AUTHORITY TO IMPLEMENT CHANGES TO NON-LEGACY CUSTOMER GENERATORS Attention: Commission Secretary Rocky Mountain Power hereby submits for filing with the Idaho Public Utilities Commission its Application, direct testimony, and exhibits in the above-referenced matter. Four paper copies of the Application, direct testimony, and exhibits will be provided separately. Files containing all of the documents, testimony and exhibits in their original formats for the court reporter as well as confidential and non-confidential workpapers will be uploaded to BOX. Informal inquiries may be directed to Mark Alder, Idaho Regulatory Manager, at(801) 220-2313. Very truly yours, G-,-D Joe Steward 9L Senior Vice President, Regulation Enclosures CC: Chris McEwan Joe Dallas (ISB# 10330) PacifiCorp, Senior Attorney 825 NE Multnomah Street, Suite 2000 Portland, OR 97232 Email:joseph.dallaskpacificorp.com Attorney for Rocky Mountain Power BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION IN THE MATTER OF THE APPLICATION ) CASE NO. PAC-E-25-02 OF ROCKY MOUNTAIN POWER FOR ) AUTHORITY TO IMPLEMENT CHANGES ) APPLICATION OF TO NON-LEGACY CUSTOMER ) ROCKY MOUNTAIN POWER GENERATORS ) Rocky Mountain Power, a division of PacifiCorp ("Company" or "Rocky Mountain Power"), in accordance with Idaho Code §61-502 and §61-503, and Rule of Procedure 52, respectfully submits this application ("Application") to the Idaho Public Utilities Commission ("Commission") requesting the Commission approve the Company's proposed changes to its on- site self-generation Electric Service Schedule 136 ("Schedule 136") tariff in accordance with Order No. 36286 and approve the Company's proposed export credit rate methodology. Specifically, the Company requests the Commission approve: (1) an export credit rate for customers on Schedule 136 beginning October 1, 2025, (2) an increased cap for non-residential customers to 2,000 kW, (3) annual updates to the export credit rate, and(4) the updated Schedule 136 tariff incorporating the changes reflected in this application. In support of its Application, the Company states as follows: I. BACKGROUND I. Rocky Mountain Power is a division of PacifiCorp, an Oregon corporation, which provides electric service to retail customers in the states of Idaho, Wyoming, and Utah. Rocky Mountain Power is a public utility in the state of Idaho and is subject to the Commission's Application of Rocky Mountain Power Page I jurisdiction with respect to its prices and terms of electric service to retail customers in Idaho pursuant to Idaho Code §61-129. Rocky Mountain Power provides retail electric service to approximately 91,000 customers in the state. A. Net Metering Regulatory History 2. Pursuant to the Commission's order on June 20, 2003, the net metering program was made available to the Company's Idaho customers through Electric Service Schedule 135 ("Schedule 135") with participation capped at 714 kilowatts, or one-tenth of one percent of the Company's 2002 retail peak demand.' 3. Customer generators use the Company grid while offsetting part or all of their energy requirement with their own production and are provided a credit at the retail rate for the energy they produce and export to the grid.During periods when the customer's generating facility is not operating or not producing sufficient energy to meet the customer's usage, energy is delivered to the customer from Company resources. 4. During each billing period, a Net Metering customer's generation exported to the grid is netted against the kilowatt-hour usage taken from the Company. If the energy generated by the customer and delivered to the Company exceeds the energy supplied by the Company to the customer during the billing period, the customer is billed for the appropriate power and other non- energy charges and compensated for any net exported energy through a financial credit, based on the applicable standard service tariff. 5. In February 2016,the Company applied to the Commission for authority to modify Schedule 135 by raising the net metering cap from 714 kW to 2,000 kW.The Commission declined to increase the overall cap on the net metering program indicating that, when it approved the 714 'In the Matter of the Petition of NW Energy Coalition and Renewable Northwest Project to Establish Net Metering Schedules for PacifiCorp,Case No.PAC-E-03-04,Order No.29260(June 20,2003). Application of Rocky Mountain Power Page 2 kW cap in 2003,it found the cap should be reviewed after it was reached and that the review should include a report regarding the required level of subsidization by non-participants.' The Commission also stated that the Company had not expressed any immediate reliability concerns and that the subsidization level at the time was small albeit still growing. Based in part on this reasoning, the Commission found it was unnecessary to cap overall participation "at this time"3 and removed the overall and individual participation caps effective May 1, 2016. The Company was ordered to file annual status reports with specific information about the Company's net metering program and to file earlier reports "if the Company at any time expects its net metering service will materially and negatively impact its system and/or its customers."4 6. On June 14, 2019 in Case No. PAC-E-19-08, the Company filed for authority to: (i) close Schedule 135 to new customer participation and cap it at the levels in place, effective at midnight local time, December 31, 2019, (ii) allow existing net metering customers and those that apply for or complete interconnection before January 1, 2020, to continue to stay on the program at the site until June 1, 2029; (iii) offer, as an alternative, its proposed Net Billing program to new customer generators through Schedule 136 for those who apply for interconnection starting February 1, 2020; (iv) implement an $85 application fee for customers that apply to interconnect a customer generation system under the Net Billing program that will reflect the one-time cost to the Company associated with processing and reviewing customer generation interconnection requests; (v) require projects that apply for interconnection before January 1, 2020 to complete interconnection within a one year period of application to be eligible to stay in the net metering program and (vi) recover the exported energy credits from the Net Billing program through the 2 In the Matter of PacifiCorp d/b/a Rocky Mountain Power's Application to Modify Electric Service Schedule 135— Net Metering Service,Case No.PAC-E-16-07,Order No.33511 at 7(April 29,2016). 3 Id. 4 Id., at 8. Application of Rocky Mountain Power Page 3 Company's annual ECAM. The application did not seek to modify the retail rates that customers pay for the service the utility provides,but only to implement a new customer generation program that uses an export credit rate. The application provided customers notice of the Company's proposal to close Schedule 135 to new customer participation and implement a new program, Electric Service Schedule No. 136—Net Billing. 7. On October 19, 2018, Idaho Power Company filed a petition relating to net billing styled as a "Petition to Study the Costs, Benefits, and Compensation of Net Excess Energy Supplied by Customer On-Site Generation." This petition was filed in response to an order from the Commission requiring it"to comprehensively study the costs and benefits of on-site generation in Idaho Power's system, as well as proper rates and rate design, transitional rates, and related issues of compensation for net excess energy provided as a resource to the Company."On October 11, 2019, Idaho Power and Commission Staff jointly submitted a"Motion to Approve Settlement Agreement." The settlement requested the Commission approve changes to Idaho Power's net metering program. The Commission rejected the settlement in part due to the absence of a comprehensive study that demonstrated system impacts and a compensation structure for excess generation. The Commission also rejected it on the grounds that Idaho Power did not notify customers that the outcome of the case could result in changes to its net metering program and because there was insufficient record to support that the settlement was reasonable, in the public interest, or otherwise in accordance with law or regulatory policy.6 The Commission directed Idaho Power to prepare and file a "credible and fair study" of the costs and benefits of distributed on-site generation and provided guidance about what would constitute an acceptable study. 5 Idaho Power Application,Idaho Power Company's Petition to Initiate Docket,Case No.IPC-E-18-15,October 19, 2018,at¶ 1,citing Idaho Power's Application for Authority to Establish New Schedules for Residential and Small General Service Customers with On-Site Generation,Case No. IPC-E-17-13,Commission Order 34046,at 31 (May 9,2018). 6 Idaho Power Application,Order No.34509("Idaho Power Order"),Case No.IPC-E-18-15,December 20,2019. Application of Rocky Mountain Power Page 4 Specifically, the Commission directed that the study should use current data, make the data publicly available, design the study in coordination with the parties and the public, resulting in a study that is both understandable by the public and can withstand public scrutiny. The Commission established a "study design"phase and a "study review"phase. During the "study design"phase, both Commission Staff and Idaho Power must "host public workshops to share information and perspectives on net-metering program design with the public and to listen to customer concerns and input."' 8. Based on the outcome of the Idaho Power settlement, on April 23, 2020, the Company filed a supplemental application to its June 14,2019 application in Case No. PAC-E-19- 08, requesting to: (i) close Schedule 135 to new customer participation and cap it at the levels in place, effective at midnight local time, July 31, 2020 per Idaho Code §61-622 paragraph (4); (ii) allow existing net metering customers and those that apply for or complete interconnection before July 31, 2020 to continue to stay on the program at the site until July 31, 2030; (iii) offer a Net Billing program to new customer generators through Schedule 136 for those who apply for interconnection starting September 1, 2020; (iv) implement an $85 application fee for customers that apply to interconnect a customer generation system under the Net Billing program that will reflect the one-time cost to the Company associated with processing and reviewing customer generation interconnection requests; (v) require projects that apply for interconnection before August 1, 2020 to complete interconnection within a one year period of application to be eligible to stay in the net metering program; and (vi) recover the exported energy credits from the net metering and net billing program through the Company's annual ECAM. In response to the supplemental application, Staff issued comments recommending the Commission issue an order 7 Idaho Power Order, at 9. Application of Rocky Mountain Power Page 5 requiring the Company to study components of on-site generation beyond what was in the Company's proposal. 9. On August 26,2020 the Commission issued Order No. 34752 and Order No. 34753. Order No. 34752, which was later adopted by Order No. 34798, granted grandfathered status to existing customers with on-site generation systems according to the following terms: • The grandfathered status runs with the meter site, not the customer. • If a system is offline for over six months, or is moved to another site, the grandfathered status of the system is forfeited. • The customer may increase the capacity of the grandfathered system by no more than 10% of the originally installed nameplate capacity, or 1 kW, whichever is greater. • The term of the grandfathering period is 25 years. 10. In Order No. 34752, an existing customer was defined as a customer who had successfully interconnected an on-site generation system as of the service date of Order No. 34798 or a customer who has applied to the Company for interconnection of an on-site generation system as of the service date of the adopting order and who successfully interconnects their system within one year of the date of their application. Order No. 34753 ordered the Company to conduct a study of on-site generation and included a scope of the study as an attachment to the order. 11. On June 29, 2023, the Company submitted an on-site generation study. Following feedback from Commission staff, the Company submitted a supplemental study on February 28, 2024, which replaced the initial submission (hereafter referred to as "the Study"). On August 8, 2024, the Commission issued Order No. 36286, acknowledging the Study and ordering the 8 The service date of Order No.34798 was October 2,2020. Application of Rocky Mountain Power Page 6 Company to file a new case, requesting changes to the structure and design of its proposed export credit rate within six months.9 The Company's application in this proceeding is made in compliance with Order No. 36286. II. PROPOSED CHANGES TO SCHEDULE 136 12. Under the Company's proposed Schedule 136 tariff, the customer pays cost-based rates for energy taken from the Company and receives compensation for energy the customer generates and exports to the system that fairly and accurately reflects the value of the exported generation. Accompanying this Application are testimonies from Company witness, Mr. Robert M. Meredith and Company witness, Mr. Daniel J. MacNeil. 13. Beginning October 1, 2025, the Company proposes to change the program to compensate customers on Schedule 136 for all exported energy at specified prices, as described by Mr. Meredith. The Company proposes setting a fixed cap on the size of individual non- residential customer generation systems and proposes export credits be treated as a Purchased Power Expense for ratemaking purposes, as described in Mr. Meredith's testimony. 14. The Company believes these changes would correct the cross-subsidy that customers with customer-generation impose upon customers who do not have customer generation. The Company will make a filing on or around July 1, 2026, and each year thereafter, to update the export credit rate for Schedule 136 customers with prices taking effect October 1 of each year. A. Export Credit Rate 15. As demonstrated in the Study, there are several variables to consider when assessing the value of the on-site generation exports. Company witness Mr. MacNeil describes 9 See In the Matter of the Application of Rocky Mountain Power to Complete the Study Review Phase of the Study and the Costs and Benefits of On-Site Customer Generation. Case No.PAC-E-23-17.Order No. 36286. Application of Rocky Mountain Power Page 7 these variables, presents the Company's calculation of the export credit rate, and supports the methodology it recommends using in updates to the export credit rate in future filings. Table 110 summarizes the Company's proposed export credit rate that, if approved, would be in effect from October 1, 2025, until October 1, 2026. Table 1: Export Credit Summary Summer Summer Winter Winter On- Export Profile Annual Peak Off-Peak On-Peak Off-Peak Volume (kWh per kW) 949 119 329 35 466 Capacity Contribution (%) 10.97% 8.69% 1.97% 0.03% 0.28% Value by Element(cents/kWh) Energy 2.415 4.007 3.063 2.934 1.513 - Integration (0.385) (0.638) (0.488) (0.467) (0.241) +Avoided Line Losses 0.184 0.304 0.233 0.223 0.115 Generation Capacity 1.488 9.408 0.770 0.121 0.078 Transmission Capacity Deferral 0.069 0.437 0.036 0.006 0.004 Transmission System Cost 0.297 1.707 0.023 1.878 0.011 Distribution Capacity Deferral 0.162 1.023 0.084 0.013 0.008 Total 4.230 16.248 3.721 4.708 1.489 (i)Annual values for information only and reflect seasonal weighting from the historical period. B. Export Credit Season and Time of Day 16. As explained further in Mr. MacNeil's testimony, the Company proposes that export credit rates vary by season and by time of day using the definitions in Schedule 36(Optional Time of Day - Residential Service), effective starting June 1, 2025. Export credit values vary significantly by season and time of day, as shown in Table 1, based on the system conditions specific to the different periods. This differentiation helps ensure that compensation to individual participants is aligned with the timing of their exports. This differentiation also encourages 10 Table 1 is also included as Table 1 to Mr.MacNeil's testimony. Application of Rocky Mountain Power Page 8 customers to consume their own generation, rather than exporting, during periods when export credit value is lower than retail rates. C. Non-Residential Customer Cap 17. As explained further in Mr. Meredith's testimony, the Company proposes to increase the cap for non-residential customers from 100 kW to 2,000 W. The increased cap will be simpler to administer for non-residential customers than a customer-specific cap,while aligning with the Company's tariffs in Utah and Oregon. Since the Company's Utah service territory directly borders its Idaho service area,maintaining the same customer generation cap in both states would streamline operations and reduce complexity for installers and Company employees. The Company plans no changes to the cap for residential customers.The Company prepared an analysis using AMI data showing that 99.95 percent of non-residential customers have a non-coincident peak of less than 2,000 kW. D. Proposed Export Credit Update Schedule 18. In Case No. PAC-E-23-17, in which the Commission acknowledged the Study, Commission Staff made several recommendations regarding updates to the export credit rate. Mr. MacNeil presents the details of Staff s recommendations and the Company's responses. To summarize, the Company proposes an annual update to the export credit rate, incorporating the most recent historical results and approved values from other rate schedules each year, with more comprehensive updates in the annual update following the filing of the Company's Integrated Resource Plan. III. CUSTOMER AND STAKEHOLDER COMMUNICATIONS 19. Rocky Mountain Power is notifying its customers of this Application by means of a press release sent to local media organizations and bill onserts included in customer bills over the course of a billing cycle. The Company will also send direct-mail letters to all existing and Application of Rocky Mountain Power Page 9 pending on-site generation customers notifying them that the Company has filed its proposal for changes informed by the Study. The letters that customers with legacy systems receive will also remind them of their legacy status, the criteria for legacy systems, and the reasons legacy status may be forfeited. The letter that customers with non-legacy systems receive will advise them on how their bills may be impacted by the outcome of the case. In addition, copies of this Application will be made available for review on the Company's website at RockyMountainPower.net/ExportCredit or at local offices in its Idaho service territory. The press release, bill onsert, and letters to customers with on-site generation are included as Attachment No. 1 to this application. IV. CORRESPONDENCE OR COMMUNICATIONS 20. Correspondence and communications regarding this Application should be addressed to: Mark Alder Idaho Regulatory Affairs Manager Rocky Mountain Power 1407 West North Temple, Suite 330 Salt Lake City, Utah 84116 Telephone: (801) 220-2313 Email: mark.alder&pacificorp.com Joe Dallas (ISB# 10330) PacifiCorp, Senior Attorney 825 NE Multnomah Street, Suite 2000 Portland, OR 97232 Email:joseph.dallas&pacificorp.com In addition, Rocky Mountain Power requests that all data requests regarding this Application be sent in Microsoft Word to the following: By email (preferred): datarequestgpacificorp.com Application of Rocky Mountain Power Page 10 By regular mail: Data Request Response Center PacifiCorp 825 NE Multnomah, Suite 2000 Portland, Oregon 97232 Informal questions may be directed to Mark Alder, Idaho Regulatory Affairs Manager at (801) 220-2313. V. MODIFIED PROCEDURE 21. The Company believes that consideration of the proposals contained in this Application do not require an evidentiary proceeding, and accordingly requests that this Application be processed under modified procedure pursuant to Rules 201-204, which allows for consideration of these issues by written submissions rather than by an evidentiary hearing. Rocky Mountain Power respectfully requests that the Commission issue an Order authorizing that this proceeding be processed under modified procedure. VI. CONFIDENTIAL INFORMATION 22. This filing, specifically the workpapers of Mr. Meredith and Mr. MacNeil includes confidential information exempt from public review under Idaho Code §§ 74-104-109 and Idaho Public Utilities Commission's Rule of Procedure 67. VII. REQUEST FOR RELIEF 23. WHEREFORE,Rocky Mountain Power respectfully requests that the Commission approve the Company's proposed changes to its on-site self-generation Schedule 136 tariff in accordance with Order No. 36286 and approve the Company's proposed: (1) export credit rate for customers on Schedule 136 beginning October 1, 2025, (2) an increased cap for non-residential customers to 2,000 kW, (3) annual updates to the export credit rate, and(4)updated Schedule 136 tariff incorporating the changes reflected in this application. Application of Rocky Mountain Power Page 11 DATED this 7th day of February, 2025. Respectfully submitted, ROCKY MOUNTAIN POWER Joe Dallas (ISB# 10330) PacifiCorp, Senior Attorney 825 NE Multnomah Street, Suite 2000 Portland, OR 97232 Email: joseph.dallas(&,pacificorp.com Attorney for Rocky Mountain Power Application of Rocky Mountain Power Page 12 ATTACHMENT NO. 1 Press Release _ROCKY MOUNTAIN POWER® POWERING YOUR GREATNESS February 7, 2025 News media hotline: 801-220-5018 Rocky Mountain Power implements new net billing rates The new rates adjust the bill credit for customers who own their own generation systems BOISE — Rocky Mountain Power continues to support the desire of customers who want to own their own power generation systems. Part of this objective is to establish a sustainable and fair program for customers who want to generate some of their own power, while keeping their connection to Rocky Mountain Power's system. Most of these customer-owned systems are solar photovoltaic arrays. The work to design a more sustainable customer generation program began in 2019 with hearings before the Idaho Public Utilities Commission (IPUC), together with technical studies submitted by the utility to the IPUC for review. In October 2020,the IPUC ruled that existing customers on Schedule 135, Net Metering Service, will remain on the existing schedule for 25 years, before transferring to the new program, Schedule 136, Net Billing Service. Under Schedule 136, new self-generating customers,who installed systems after October 2020, would continue to offset some or all of their energy usage while receiving a billing credit at retail rates for the excess energy they export to the utility's system, but were notified that the credit they receive for exported energy was subject to change in the future.Additional study and analysis followed to determine a sustainable export credit rate that would be fair for all Idaho customers of Rocky Mountain Power. Rocky Mountain Power proposes that the export credit be updated annually so that the credits awarded for energy exported to the utility grid would accurately reflect their economic value over time. "This change to the program will ensure that Idaho customers who generate some of their own power will receive fair value for the excess power they export to the utility grid," said Robert Meredith, director, pricing and tariff policy. "The new export credit rate also ensures that other customers are held economically indifferent between whether they receive energy from their neighbor's rooftop solar system or from any other source." For residential customers on the non-legacy Schedule 136, Rocky Mountain Power is asking to implement the proposed changes effective October 1, 2025.Specifically, Rocky Mountain Power is requesting that the value of the credit for exported energy would change from the retail rate, valued around 9 to 10 cents per kWh for residential customers,to a time differentiated financial bill credit that would be approximately 4 cents per kWh but that would be updated annually. For residential customers on the new Schedule 136, Rocky Mountain Power evaluated 2023/2024 data to assess how customer bills may be affected by the proposed change in the export credit rate.The 2023/2024 average monthly bill for residential customers under the current net monthly compensation 1 structure is$52. Under the proposed Schedule 136, Net Billing Service,the average bill would increase to $89, resulting in an average increase of approximately$37 per month or 72%. Rocky Mountain Power's proposed export credit proposal is subject to approval by the IPUC. Customers may review the proposed on-site generation compensation structure, including the methodologies behind the net billing and excess energy export credit rate changes. Copies of the application are available to the public: • At the IPUC offices, 11331 W. Chinden Blvd. Building 8, Suite 201-A, Boise, ID 83714, or puc.idaho.gov. • Rocky Mountain Power offices: Preston—509 S. 2nd East; Shelley—852 E. 1400 North; Montpelier—24852 U.S. Hwy 89. • On the web at RockyMountainPower.net/ExportCredit. Customers can also learn more about customer generation at RockyMountainPower.net/CustomerGen. Customers also may subscribe to the IPUC's RSS feed to receive periodic updates via email about the case. Written comments regarding Rocky Mountain Power's proposal (Case No. PAC-E-25-02) may be filed with the IPUC(puc.idaho.gov/Form/CaseComment). About Rocky Mountain Power Rocky Mountain Power provides safe and reliable electric service to more than 1.2 million customers in Utah, Wyoming and Idaho.The company supplies customers with electricity from a diverse portfolio of generating plants including hydroelectric,thermal, wind, geothermal and solar resources. Rocky Mountain Power is part of PacifiCorp, one of the lowest-cost electricity providers in the United States, with two million customers in six western states. For more information, visit RockyMountain Power.net. 2 Bill Onsert Rocky Mountain Power Files Export Credit Rate Plan Para m6s in formaci6n en c6mo este cambio impactar6 su factura, flame al 1-888-225-2611. Rocky Mountain Power continues to support the desire of those customers who want to own their own power generation systems. Part of this objective is to establish a sustainable and fair program for customers who want to generate some of their own power (such as through rooftop solar arrays)while remaining connected to Rocky Mountain Power's system,the company is filing program changes for the non-legacy Schedule 136 Net Billing Service program with the Idaho Public Utilities Commission (IPUC)for review and approval. In October 2020,the IPUC ruled that existing customers on Schedule 135, Net Metering Service,will remain on the existing schedule for 25 years, before transferring to a new program,Schedule 136, Net Billing Service. Under Schedule 136, new self-generating customers (those who installed their systems after October 2020)would continue to offset some or all of their energy usage while receiving a billing credit for the excess energy they provide back to Rocky Mountain Power's system.The credit is designed to ensure that customers who don't choose to own their own power generation systems will not subsidize those who do. This proposed export credit would be subject to an annual update by the IPUC to accurately reflect the value of the energy exported by customers to Rocky Mountain Power's grid. For residential customers on the new Schedule 136, Rocky Mountain Power is asking to implement the proposed changes effective October 1,2025: •A change in the value of credit for exported energy from the retail rate,valued between$0.07 to$0.18 per kilowatt-hour for residential customers,to a time differentiated financial bill credit that would be approximately $0.04 per kilowatt-hour but that would be updated annually. •A modification in the eligibility size cap for commercial, industrial,and irrigation customers. If approved, Rocky Mountain Power expects that the average bill for residential customers on Schedule 136 will increase from$52 to $89, resulting in an average increase of$37 per month or 72%. Copies of Rocky Mountain Power's application to the IPUC are available to the public in the following ways: • Physical copies can be obtained at the following locations: Idaho Public Utilities Commission Rocky Mountain Power offices www.puc.idaho.gov Rexburg— 170 W. 2nd North 11331 W. Chinden Blvd. Building 8, Preston—509 S. 2nd East Suite 201-A Shelley—852 E. 1400 North Boise, ID 83714 Montpelier—24852 U.S. Hwy 89 • On the web at RockyMountainPower.net/ExportCredit.Customers can also learn more about customer generation at RockyMountainPower.net/CustomerGen. Customers can also subscribe to the IPUC's RSS feed to receive periodic updates via email about the case. Written comments regarding Rocky Mountain Power's proposal (Case No. PAC-E-25-02) may be filed with the IPUC (puc.idaho.gov/Form/CaseComment). _ROCKY MOUNTAIN ©2025 Rocky Mountain Power POWER, Letter to Legacy Customers _ ROCKY MOUNTAIN 1407 W.North Temple,Suite 330 POWER. Salt Lake City,UT 84116 A DIVISION OF PACIFICORP February 7, 2025 VIA ELECTRONIC DELIVERY NAME MAILING ADDRESS CITY, STATE ZIP Hello, As a customer with on-site generation, you are receiving this letter because we want you to be aware of proposed changes to the compensation structure for on-site generation. This letter is specific to your on-site generation system at [SITE ADDRESS], meter number [XXXXXXXX]. Please note - as of the date of this letter, the system referenced above is a legacy (i.e., grandfathered) system, which means your on-site generation compensation structure (I to I kilowatt-hour [kWh] usage offset) does not terminate until October 2, 2045. If you have multiple on-site generation systems, you will receive a letter specific to each system. Below are details about the proposed changes being considered by the Idaho Public Utilities Commission(IPUC) - as well as information on how you can participate. What change is being proposed? Rocky Mountain Power is requesting changes to its on-site generation offering that are a step towards ensuring fair prices for all customers. Rocky Mountain Power is seeking approval of a compensation structure that accurately measures an on-site generator's use of the electrical grid and an export energy credit rate that will result in a fair and accurate valuation of customers' exported energy. For all customers with non-legacy systems, Rocky Mountain Power is asking to implement changes starting October 1, 2025, including: • A change in the value of credit for exported energy from the retail rate, valued between 7 to 18 cents per kWh for residential customers,to a time differentiated financial bill credit that would be approximately 4 cents per kWh but that would be updated annually. • A modification in the eligibility size cap for commercial, industrial, and irrigation customers. Why is Rocky Mountain Power requesting changes? The proposed changes follow Rocky Mountain Power's On-Site Generation study in Case No. PAC-E-23-17, which analyzed the benefits and costs of on-site generation on Rocky Mountain Power's electrical grid. The study provides a basis for implementing changes to ensure that customers are paid fair rates for their exports and customers without solar or other on-site generation systems are not subsidizing the rates for self-generating customers. Solar power and other renewable energy sources are an important part of Rocky Mountain Power's energy mix, and the company supports customers who choose to participate in their own on-site Idaho Public Utilities Commission February 7, 2025 Page 2 generation. The company's goal with this request is to modernize the compensation structure for on-site generation to ensure prices for excess energy are fair and equitable for all customers. How do I maintain my Legacy Status? As part of previous cases, the IPUC granted legacy status — sometimes referred to as "grandfathered"—to eligible on-site generation systems as of October 2, 2020. The Commission also acknowledged the following criteria for legacy systems: (1) The grandfathered status runs with the meter site, not the customer. A customer who moves into a property with a legacy system gets to "inherit"the legacy status of the system. Likewise, when a customer moves from a property with a legacy system, that customer does not get to take the legacy status of the system with them to their next property. (2) If a system is offline for more than six months, or is moved to another site, the legacy status of the system is forfeited. (3) The customer may increase the capacity of the legacy system by no more than 10% of the originally installed nameplate capacity or I kW, whichever is greater. (4) The term of the grandfathering period is 25 years terminating on October 2, 2045. How can I participate? For more details about the proposed changes to the on-site generation compensation structure, including the methodologies behind the net billing and excess energy export credit rate changes customers can review Rocky Mountain Power's proposal, which is subject to approval by the IPUC. Copies of the application are available to the public at the IPUC offices(11331 W. Chinden Blvd. Building 8, Suite 201-A, Boise, ID 83714), Rocky Mountain Power offices, or at RockyMountainPower.net/ExportCredit or puc.idaho.gov. Customers also may subscribe to the IPUC's RSS feed to receive periodic updates via email about the case. Written comments regarding Rocky Mountain Power's proposal (Case No. PAC-E-25-02)may be filed with the IPUC (puc.idaho.gov/Form/CaseComment). You can find more information about Customer Generation, including FAQs, at RockyMountainPower.net/CustomerGen. If you have additional questions, you can call our Customer Care team at 888-221-7070. Sincerely, Your Rocky Mountain Power Customer Generation Team Letter to Non-Legacy Customers _ ROCKY MOUNTAIN 1407 W.North Temple,Suite 330 POWER. Salt Lake City,UT 84116 A DIVISION OF PACIFICORP February 7, 2025 VIA ELECTRONIC DELIVERY NAME MAILING ADDRESS CITY, STATE ZIP Hello, As a customer with on-site generation, you are receiving this letter because we want you to be aware of proposed changes to the compensation structure for on-site generation. This letter is specific to your non-legacy on-site generation system at [SITE ADDRESS], meter number [XXXXXXXX]. If you have multiple on-site generation systems,you will receive a letter specific to each system. Below are details about the proposed changes being considered by the Idaho Public Utilities Commission(IPUC) with information on how you can participate. What is this change being proposed? Rocky Mountain Power is requesting changes to its on-site generation offering as a step towards ensuring fair prices for all customers. Rocky Mountain Power is seeking approval of a compensation structure that accurately measures an on-site generator's use of the electrical grid and an excess export energy credit rate that will result in a fair and accurate valuation of customers' exported energy. For all customers with non-legacy systems, Rocky Mountain Power is asking to implement the proposed changes effective October 1, 2025: • A change in the value of credit for exported energy from the retail rate, valued between 7 to 18 cents per kWh for residential customers,to a time differentiated financial bill credit that would be approximately 4 cents per kWh but that would be updated annually. • A modification in the eligibility size cap for commercial, industrial, and irrigation customers. Why is Rocky Mountain Power requesting changes? The proposed changes follow Rocky Mountain Power's On-Site Generation study in Case No. PAC-E-23-17, which analyzed the benefits and costs of on-site generation on Rocky Mountain Power's electrical grid. The study provides a basis for implementing changes to ensure that customers are paid fair rates for their exports and customers without solar or other on-site generation systems are not subsidizing the rates for self-generating customers. Solar power and other renewable energy sources are an important part of Rocky Mountain Power's energy mix, and the company supports customers who choose to participate in their own on-site Idaho Public Utilities Commission February 7, 2025 Page 2 generation. The company's goal with this request is to modernize the compensation structure for on-site generation to ensure prices for excess energy are fair and equitable for all customers. How might my bill be affected? For residential customers with non-legacy systems,Rocky Mountain Power evaluated 2023/2024 data to assess how customer bills may be affected by the proposed change in compensation structure. The average monthly bill for residential customers under the current net billing compensation structure is about$52.Under the proposed export credit price,the average bill would increase to $89, resulting in an average increase of approximately $37 per month or about 72%. A typical Rocky Mountain Power residential customer in Idaho has a bill of$105.48 per month. The chart below shows the change in average monthly bills moving from the existing retail rate credit to an export credit valued at about 4 cents per kWh. The chart is organized by customers' average net monthly energy consumption. Residential Schedule 136 Average Monthly Bill Impact - $326.88 $298.86 $219.45 $186.19 $167.71 $133.68 $110.66 $59.48 $72.52 $21.60. A 0-500 kWh B:501-1,000 kWh C:1,001-1,500 kWh D:1,501-2,000 kWh E.2,001 kWh+ (610 customers) (197 customers) (75 customers) (25 customers) (20 customers) Average MonthlyNet Delivered kWh ■Current lvbnthlyAverage Bill ■Proposed NbnthlyAverage Bill How would non-legacy customer generators be credited for their excess energy under the proposed changes? Under the proposed rate structure, customers are charged for all kWh consumed from the grid at the retail rate,and are credited for all kWh exported to the grid at a time differentiated export credit rate. What is a "non-legacy" system? As part of previous cases, the IPUC granted legacy status — sometimes referred to as "grandfathered" — in October of 2020 to existing customers for a 25-year period and established Schedule 136 for new customers going forward. In these previous cases, the IPUC acknowledged Idaho Public Utilities Commission February 7, 2025 Page 3 certain criteria for these systems to maintain legacy status, which allows those systems to retain the net metering compensation structure for 25 years. All other systems, including the system referenced in this letter, are "non-legacy" and are subject to changes in the on-site generation compensation structure, including the changes currently being considered by the IPUC. How can I participate? For more details about the proposed changes to the on-site generation compensation structure, including the methodologies behind the net billing and excess energy export credit rate changes customers can review Rocky Mountain Power's proposal, which is subject to approval by the IPUC. Copies of the application are available to the public at the IPUC offices(11331 W. Chinden Blvd. Building 8, Suite 201-A, Boise, ID 83714), Rocky Mountain Power offices, or at RockyMountainPower.net/ExportCredit or puc.idaho.gov. Customers also may subscribe to the IPUC's RSS feed to receive periodic updates via email about the case. Written comments regarding Rocky Mountain Power's proposal (Case No. PAC-E-25-02) may be filed with the IPUC (puc.idaho.gov/Form/CaseComment). You can find more information about Customer Generation, including FAQs, at RockyMountainPower.net/CustomerGen. If you have additional questions, you can call our Customer Care team at 888-221-7070. Sincerely, Your Rocky Mountain Power Customer Generation Team