20250228AVU to Staff 5 Attachment A - 2025 WA 1st Qtr - Combined.pdf

Service Date: February 7,2025
BEFORE THE WASHINGTON
UTILITIES AND TRANSPORTATION COMMISSION
In the Matter of DOCKET UE-210826
Avista Corporation d/b/a Avista Utilities, ORDER 02
2020-2029 Ten-Year Achievable Electric
Conservation Potential and 2022-2023 REGARDING AVISTA CORPORATION
Biennial Conservation Target Under RCW D/B/A AVISTA UTILITIES' 2022-2023
19.285.040 and WAC 480-109-010 BIENNIAL ELECTRIC TARGET
REPORT, WAIVING PENALTY
BACKGROUND
1 The Energy Independence Act(EIA)'requires Washington's electric utilities to "pursue
all available conservation"that is cost-effective, reliable, and feasible. Electric utilities
are required to acquire this conservation by setting (and achieving) biennial conservation
targets.2
2 To address extenuating circumstances such as those arising from the COVID-19
pandemic and the effects of inflation, the Legislature adopted, effective in July 2021,
subsection 1(e) of RCW 19.285.0403 to allow an electric utility to be considered in
compliance even when failing to meet its biennial acquisition target for cost-effective
conservation in certain circumstances. This subsection states that even if a utility has not
achieved its target, it can be"considered in compliance"with its biennial acquisition
target if there were "events beyond the reasonable control of the utility that could not
have been reasonably anticipated or ameliorated prevented it from meeting the
conservation target."4
' RCW 19.285.040.
z WAC 480-109-100(3).
' RCW 19.285.040(1)(e).
4 RCW 19.285.040(1)(e) goes on to state: "Events that a qualifying utility may demonstrate were
beyond its reasonable control,that could not have reasonably been anticipated or ameliorated,
and that prevented it from meeting the conservation target include (i)Natural disasters resulting
in the issuance of extended emergency declarations; (ii)the cancellation of significant

DOCKET UG-210826 PAGE 2
ORDER 02
3 On May 31, 2024, Avista Corporation d/b/a Avista Utilities (Avista or Company) filed its
2022-2023 Biennial Conservation Report with the Washington Utilities and
Transportation Commission(Commission) in Docket UE-210830, as rule requires.' A
revision to its Biennial Conservation Report was filed on June 21, 2024, to address errors
found in Staff s draft report review.
4 In comments on electric biennial conservation reports, filed July 24, 2024, Commission
staff(Staff) notes 2022-2023 were difficult years for conservation achievement.6 The
pandemic left lingering effects of an overflow of challenges, such as customer financial
challenges; changes in customer demand; and labor and supply chain shortages. These
elements added to the already significant challenges utilities face in achieving the
remaining conservation in the region.
5 Table 1 summarizes Avista's electric conservation target achievements as outlined in the
Company's biennial and annual conservation reports.
Table 1: Avista's Electric Targets and Achievements (MWh)
A Total Conservation Goal 106,644
B Decoupling Penalty Threshold' 5,078
C Total Conservation Achievement 84,827
D % of Total Conservation Goal Achieved (C/A X 100%) 80%
E EIA Target 101,566
conservation projects; and(iii) actions of a governmental authority that adversely affects the
acquisition of cost-effective conservation by the qualifying utility."
5 In the Matter of Avista Corp. d/b/a Avista Utils.' 2020-2029 Ten-Year Achievable Electric
Conservation Potential and 2022-2023 Biennial Conservation Target Under RCW 19.285.040
and WAC 480-109-010, Docket UE-210826, Order 01 at 7,¶27 (Jan. 18, 2022).
6 In the Matter of Avista Corp. d1b/a Avista Utils.. 2020-2029 Ten-Year Achievable Electric
Conservation Potential and 2022-2023 Biennial Conservation Target Under RCW 19.284.040
and WAC 480-109-010,Dockets UE-210830, Commission Staff Comments Regarding Electric
Utility Conservation Achievements Under the Energy Independence Act(Staff Comments)(July
24, 2024).
'Id.
8 Included in Total Conservation Goal (Row A).

DOCKET UG-210826 PAGE 3
ORDER 02
F EIA Penalty Threshold 91,054
G EIA Penalty Threshold plus Decoupling 96,132
H Excess Savings Applied 4,841
I EIA Penalty-Liable Achievement 79,213
J % of EIA Penalty Threshold Achieved(H/F X 100%) 87%
Table 2: Avista's Revised Electric Targets and Achievements (MWh)
A Total Conservation Goal 106,644
B Decoupling Penalty Threshold 5,078
C Total Conservation Achievement 73,503
D % of Total Conservation Goal Achieved(C/A X 100%) 69%
E EIA Target 101,566
F EIA Penalty Threshold 91,054
G Excess Savings Applied 4,841
H EIA Penalty-Liable Achievement 67,889
I % of EIA Penalty Threshold Achieved(H/F X 100%) 75%
*Revised fields are marked gray.
6 The Company used several adaptive management strategies including, a Midstream
program addition in 2023 as well as a Contractor Incentive Program. The Company
provided minimum information in its original filing concerning the extenuating
circumstances that may have prevented it from accomplishing its goals.
7 In its review, Staff averred that Avista did not achieve its EIA or decoupling targets.
Staff notes the Company did not provide sufficient evidence to qualify for compliance
under RCW 19.285.040(1)(e). io
8 Staff reviewed the conservation reports for compliance with relevant rules and orders. If
a Company did not meet its conservation target(s), Staff looked for evidence of the
following two items: (1) circumstances that would allow a Company to be"considered in
9 Included in Total Conservation Goal (Row A).
10 Avista's BCR at 5-6.

DOCKET UG-210826 PAGE 4
ORDER 02
compliance"under RCW 19.285.040(1)(e);11 and (2) demonstration of adaptive
management as discussed in WAC 480-109-100(1)(a)(iv) (namely, continuous review
and updates to adapt to changing conditions and technologies). Additionally, Staff
acknowledges the attempts from Avista to ameliorate1 in response to the continued
challenges faced during this biennium. The following discussion underscores some of the
key dynamics underlying the Company's achievement, highlighting adaptive
management techniques employed by the utility as they reacted to this biennium's
challenges. These highlights are explored further in Staff comments.13
9 Staff recognized Avista did face challenges connected to the pandemic. While Staff
acknowledges that these issues have affected Avista program delivery, Staff believes that
these events could have been reasonably anticipated or ameliorated prior to and during
the biennium, as the pandemic started two years prior. Notwithstanding Staff s
recommendation, the Company states that COVID-19 did amount to a condition outside
the reasonable control of the utility,which could not have been reasonably anticipated,
and which could not have been reasonably ameliorated.14
10 Accordingly, Staff recommends penalties for(1) failure to comply with energy
conservation goals or renewable energy targets as authorized in RCW 19.285.060(1) and
(2) for failing to meet decoupling targets pursuant to Order 5 in consolidated Dockets
UE-140188 and UG-140189, which goes into further detail regarding decoupling
triggers, rate adjustment caps, and decoupling conditions." Order 01 and Staff s memo
" RCW 19.285.040(1)(e)provides circumstances where a qualifying electric utility can be
"considered in compliance"with the biennial acquisition targets.
12 Merriam-Webster. "Ameliorate."Merriam-Webster.com Dictionary. Accessed August 7,
2024. https://www.merriam-webster.com/dictionary/ameliorate.Ameliorated: to make better or
more tolerable. RCW 19.285.040(1)(e), "A qualifying utility is considered in compliance with its
biennial acquisition target for cost-effective conservation in (b) of this subsection if events
beyond the reasonable control of the utility that could not have been reasonably anticipated or
ameliorated prevented it from meeting the conservation target."
"In the Matter of Avista Corporation d/b/a Avista Utilities 2022-2023 Biennial Conservation
Report, Docket UE-210826, Staff Comments,p. 15-19(July 24, 2024).
14 In the Matter of Avista Corporation d/b/a Avista Utilities 2022-2023 Biennial Conservation
Report, Docket UE-210826,Avista's Comments on Staff Recommendation(August 21,2024).
15 See Wash. Utils. & Transp. Comm'n v. Avista Corporation d/b/a Avista Utilities, Dockets
UE-140188 and UG-140189, Order 05 at¶¶22-28 (filed November 25, 2014).

DOCKET UG-210826 PAGE 5
ORDER 02
in Docket UE-15207616 mention Staff s position that the decoupling commitment should
be subject to penalties at the same level as the EIA penalty. The Commission later
adopted this methodology in PacifiCorp's17 and PSE's18 rate case proceedings.
11 On conservation goals, due to Avista only achieving 67,889 MWh out of the 91,054
MWh EIA penalty threshold, Staff recommends penalties under RCW 19.285.060(1).
Staff calculated the final penalty for Avista by multiplying $72.7219 by the MWh deficit
of 23,165, to arrive at $1,684,558.80.20
12 Regarding decoupling, Staff recommends penalties according to Commission Order 01
in Docket UE-210826; Avista's Two-Year Decoupling Penalty Threshold for 2022-2023
is 5,078 MWh.21 Due to Avista meeting 0 out of the 5,078 NM decoupling
requirement, Staff recommends penalties under RCW 19.285.060(1), as described above
16 In re Avista Corporation d/b/a Avista Utilities'2016-2017 Electric Biennial Conservation
Plan,Docket UE-152076, Order 01 at 2, n.5 (Jan. 28, 2016).
17 Wash. Utils. & Transp. Comm'n v. Pacific Power&Light Company d/b/a PacifiCorp,Docket
UE-152253, Order 12 at 49,¶139 (Sept. 1,2016).
18 Wash. Utils. & Transp. Comm'n v. Puget Sound Energy, Dockets UE-170033 and UG-170034,
Order 08 at 84-91,¶¶249-262 (Dec. 5, 2017), with reference to JAP-lT at 144-145.
19 Staff used data from the Bureau of Economic Analysis of the United States (BEA)published on
the Federal Reserve Economic Data's (FRED)website for the gross domestic product(GDP)
implicit price deflator(GDPDEF).
Staff adjusted the statutory penalty rate of$50(RCW 19.285.060(1))with the GDPDEF by year.
For the current year, the penalty rate is$72.72 per MWh. The administrative penalty rate formula,
which results in$72.72 up from$50, is as follows:
Adminstrative Penalty Raten
= Administrative Penalty Raten_, x (1 + GDPDEFI
\ 100 1
20 Penalty Calculation for EIA($72.72 * 23,165=$1,684,558.80)
21 In the Matter of Avista Corporation d/b/a Avista Utilities 2022-2023 Biennial Conservation
Report, Docket UE-210826, Order 01 Accepting 2020-2029 Ten-Year Achievable Conservation
Potential and 2022-2023 Biennial Conservation Target, Subject to Conditions, at 6(January 18,
2022).

DOCKET UG-210826 PAGE 6
ORDER 02
for the EIA penalties. Using the same calculation, Staff recommends Avista's penalty for
failing to achieve the decoupling target should be $369,272.16.22
13 Additionally, since Order 05 in consolidated Dockets UE-140188 and UG-140189 only
refers to the RCW regarding potential penalties and not exceptions to penalties, Staff
does not believe that the RCW language regarding exceptions to penalties applies to
decoupling goals. Therefore, Staff is recommending that Avista be penalized for failing
to achieve its EIA and decoupling goals. The combined fine for failing to achieve each of
these goals is $2,027,142.72.23
14 Following filing of Staff s recommendations on August 19, 2024, Avista filed comments
on August 21, 2024. In its comments, Avista strongly contests Staffs penalty
recommendations on several grounds including that the lasting impacts of COVID-19
were not reasonably anticipated at the time targets were set, the lasting impacts of
COVID-19, including those on interest rates, supply chains, and customer behavior,
could not reasonably be prevented.24
15 This matter came before the Commission at its August 22, 2024, Recessed Open
Meeting.25 The Commission heard comments from Staff and Avista. The Company
argued conservation is important and recommended the Commission find the Company
in compliance because of extenuating circumstances.
DISCUSSION
16 We agree with Avista's recommendation. As a preliminary matter, we find that Avista
has complied with the reporting requirements of WAC 480-109-120 and 120 and RCW
19.285.070 by timely filing a biennial conservation report to allow the Commission to
determine how Avista is performing compared to its conservation targets.
22 Penalty Calculation for Decoupling(5,078 * $72.72=$342,583.92).
23 $1,684,558.80+$342,583.92=$2,027,142.72.
24 In the Matter of Avista Corporation d/b/a Avista Utilities 2022-2023 Biennial Conservation
Report, Docket UE-210826,Avista's Comments on Staff Recommendation at 4-8 (August 21,
2024).
25 The Commissioners present at the August 22,2024,Recessed Open Meeting included Chair
Dave Danner, who has since retired as the issuance of this decision,but voted to approve this
Order 02, at the August 22, 2024,Recessed Open Meeting.

DOCKET UG-210826 PAGE 7
ORDER 02
17 We acknowledge that, as stated in Staff s comments on electric biennial conservation
reports, 2022-2023 were difficult years for conservation achievement. However, with the
benefit comments provided during the Open Meeting, we find that lingering issues
related to the COVID-19 pandemic caused challenges outside of the Company's
reasonable control, such as customer financial challenges; changes in customer demand;
and labor and supply chain shortages. These elements added to the already significant
challenges utilities face in achieving the remaining conservation in the region.
18 Under RCW 19.285.040(1)(e), "a qualifying utility is considered to be in compliance
with its biennial acquisition target for cost-effective conservation if events beyond the
reasonable control of the utility that could not have been reasonably anticipated or
ameliorated prevented it from meeting the conservation target." The subsection goes on
to explain how a utility"may demonstrate" such events, by providing an illustrative list
of examples which "include"natural disasters, major cancelations, and exercises of
governmental authority. While the illustrative list does include the word"and," our plain
reading of the statute is that the word"include" indicates the example conditions are
meant to be illustrative, and not exclusive.26 That is to say that an exercise of government
authority that interfered with a qualifying utility's ability to meet its targets, does not
require an accompanying natural disaster for the event to be considered out of the
company's control. Instead, we interpret RCW 19.285.040(1)(e) as setting a broad
reasonableness standard which (i) first asks if an event beyond the utility's reasonable
control occurred, before exploring(ii) whether the event could have been reasonably
anticipated, and whether(iii) the company took reasonable efforts to ameliorate or
mitigate the consequences of the unexpected event, once it became aware of it.
19 Although Avista failed to meet its conservation targets, we find that there existed
sufficient circumstances to allow Avista to be "considered in compliance" for the
purposes of RCW 19.285.040(1)(e). Further, the Company has shown that it has
exercised adaptive management techniques in an effort to adapt to the challenges the
26 State V. Keller, 143 Wn.2d 267,276(2001) ("Courts should assume the Legislature means
exactly what it says. Plain words do not require construction. The courts do not engage in
statutory interpretation of a statute that is not ambiguous. If a statute is plain and unambiguous,
its meaning must be derived from the wording of the statute itself. A statute is ambiguous if it
can reasonably be interpreted in two or more ways,but it is not ambiguous simply because
different interpretations are conceivable.")

DOCKET UG-210826 PAGE 8
ORDER 02
pandemic introduced. Thus, we find that Avista has sufficiently complied with its
biennial acquisition target for cost-effective conservation to be considered in compliance,
and therefore conclude that no penalty is warranted at this time.
20 The Commission has discretion to impose or not impose penalties. The legislative intent
in the EIA and our intent in approving decoupling goals is to encourage conservation. We
therefore find it appropriate to exercise such discretion for Avista's decoupling targets in
a manner that is consistent with the standard provided for in RCW 19.285.040(1)(e).
21 As a result, notwithstanding the Company's failure to comply with Order 05 in
consolidated Dockets UE-140188 and UG-140189, the Commission finds it appropriate
to forgo issuing a penalty here due to the totality of the circumstances.
22 On this point, and for future clarity, we find it appropriate to amend Order 05 in
consolidated Dockets UE-140188 and UG-140189 and Order 01 in this matter to clarify it
is our intent that not only might the penalty provisions associated with the EIA apply to
decoupling targets, but so too do the exemptions under RCW 19.285.040(1)(e).Notice
shall be issued to interested parties so as to allow an opportunity to comment on these
proposed amendments.
FINDINGS AND CONCLUSIONS
23 (1) The Commission is an agency of the State of Washington vested by statute with
the authority to regulate the rates, rules,regulations, practices, accounts,
securities, transfers of property and affiliated interests of public service
companies, including electric companies.
24 (2) Avista is an electric company and a public service company subject to
Commission jurisdiction. Avista is a qualifying electrical company under RCW
80.04.010.
25 (3) On May 31, 2024, Avista filed its Biennial Conservation Report, which showed
that Avista had failed to meet its conservation targets under the EIA and its
decoupling targets.
26 (4) Pursuant to RCW 285.040(1)(e), the Commission may determine that a utility is

DOCKET UG-210826 PAGE 9
ORDER 02
considered in compliance with its biennial acquisition target for cost-effective
conservation if events beyond the reasonable control of the utility that could not
have been reasonably anticipated or ameliorated prevented it from meeting the
conservation target.
27 (5) The COVID-19 pandemic created circumstances beyond the control of Avista
that interfered with the Company's ability to meet its conservation and decoupling
targets.
28 (6) Avista took adequate adaptive measures to attempt to ameliorate the effect of
the pandemic on its conservation efforts.
29 (7) This matter came before the Commission at a recessed open meeting on August
22, 2024.
30 (8) After reviewing Avista's report, Staff s comments, Avista's comments,
and giving due consideration to relevant matters, the Commission finds that
Avista has complied with the reporting requirements of WAC 480-109-120 and
RCW 19.285.070 and is considered in compliance with its biennial acquisition
target for cost-effective conservation and decoupling.
ORDER
THE COMMISSION ORDERS:
31 (1) The Commission accepts Avista Corporation d/b/a Avista Utilities filed its 2022-
2023 Biennial Conservation Report with the Washington's recommendation not
to impose a penalty and determines that the 2022-2023 Biennial Report of
Conservation Accomplishments complies with the conditions of Order 01 in
Docket UE-210826, and the reporting requirements of RCW 19.285.070 WAC
480-109-120 and RCW 19.285.070 WAC 480-109-120.
32 (2) The Commission rejects Commission staffs recommendation to impose penalties
upon Avista Corporation d/b/a Avista Utilities, pursuant to, for: (i) failure to
comply with energy conservation goals approved of in Order 01 of this matter and
(ii) for failing to meet decoupling targets pursuant to Order 05 in consolidated
Dockets UE-140188 and UG-140189.

DOCKET UG-210826 PAGE 10
ORDER 02
33 (3) Notice shall be issued to interested parties to amend Order 05 in consolidated
Dockets UE-140188 and UG-140189, and Order 01 in this matter to clarify it is
our intent that not only might the penalty provisions associated with the EIA
apply to decoupling targets, but so too do the exemptions under RCW
19.285.040(1)(e).
34 (4) This Order shall not affect the Commission's authority over rates, services,
accounts, valuations, estimates, or determination of costs, on any matters that may
come before it.
DATED at Lacey, Washington, and effective February 7, 2025.
WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION
v
ANN E. RENDAHL, Commissioner
MILTON H. DOUMIT, Commissioner

Service Date: January 31,2025
BEFORE THE WASHINGTON
UTILITIES AND TRANSPORTATION COMMISSION
In the Matter of DOCKET UG-210827
AVISTA CORPORATION d/b/a ORDER 02
AVISTA UTILITIES'
ACCEPTING AVISTA'S 2022-2023
2022-2023 Biennial Acquisition Target BIENNIAL CONSERVATION
Under RCW 80.28.280 REPORT; ADDRESSING
COMPLIANCE WITH DECOUPLING
COMMITMENT
BACKGROUND
1 Until recently, conservation targets for gas companies were set by Commission order in a
general rate case. Effective 2022, Revised Code of Washington (RCW) 80.28.380
codified requirements for conservation targets for gas companies. These new statutory
requirements for gas company conservation targets, unlike those for electric company
conservation targets, do not contain an exception for extenuating circumstances if a
company fails to reach its target.' On May 31, 2024, Avista Corporation d/b/a Avista
Utilities (Avista or Company) filed in Dockets UE-210826 and UG-210827, its 2022-
2023 Biennial Conservation Report(Biennial Conservation Report or BCR) for both its
electric and gas services.2 The gas conservation targets must meet the requirements of
Order 05 in consolidated Dockets UE-140188 and UG-140189, as well as Order 09 in
consolidated Dockets UE-190334, UG-190335, and UE-190222. The Company's gas
conservation target achievements as outlined in the Company's Biennial Conservation
Report are summarized in the table below:
1 The exception for electric companies is contained in RCW 19.285.040(1)(e).
2 In the Matter of Avista Corp. d/bla Avista Utils. 2022-2023 Biennial Acquisition Target Under
RCW 80.28.380,Docket UG-210827,2022-2023 Biennial Conservation Report at 5 (May 31,
2024) (Avista's BCR).

DOCKET UG-210827 PAGE 2
ORDER 02
Table 1: Avista's Natural Gas Targets and Savings (Therms)
A Total Conservation Goal (B+C) 2,302,056
B Conservation Target 2,192,434
C Decoupling Penalty Threshold 109,622
D Total Reported Savings 1,263,481
E % of Conservation Target Achieved(D/B X 100%) 58%
F % of Total Conservation Goal Achieved (D /A X 100%) 55%
2 In sum, the Company achieved 1,263,481 therms of its 2022-2023 biennial conservation
target of 2,302,056 therms, achieving a deficit of 64,485 therms. Avista applied 0 therms
to its 2022-2023 decoupling commitment of 109,622 as its Two-Year Conservation Goal
which falls short of the Company's decoupling penalty threshold.
3 Regarding decoupling, Staff recommends penalties according to Order 09 in consolidated
Dockets UE-190334, UG-190335, and UE-190222.3 Staffs recommendation is due to
Avista's deficit of 109,622 therms being less than 3.75% of its incremental commitment.
In its BCR, the Company acknowledged that it failed to achieve its 2022-2023
decoupling commitment, agreeing to pay the penalty of$75'000.4 Staff did not believe a
penalty exemption was present in either Order 05 or Order 09.
4 Following filing of Staff s comments on July 24, 2024, Avista filed comments on August
21, 2024. In its comments, Avista strongly contests Staffs penalty recommendations
3 Wash. Utils. & Transp. Comm'n v. Avista Corp. d/b/a Avista Utils., Dockets UE-1903341 UG-
190335, and UE-190222, Order 09 at 34,198 (March 25,2020).
4 Avista's BCR at 6.

DOCKET UG-210827 PAGE 3
ORDER 02
stemming from RCW 19.285.040 but has agreed to pay the prescribed$75,000 penalty,
which will be funded by Avista's shareholders.
S Staff recommended that Avista cannot not be "considered in compliance"with its gas
biennial acquisition target for cost-effective conservation pursuant to RCW
19.285.040(1)(e), and recommended a penalty,pursuant to RCW 80.04.380.
6 This matter came before the Commission at its August 22, 2024, Recessed Open
Meeting. The Commission heard comments from Staff and Avista.5 The Company
argued against Staff s recommendation and expressed that conservation is important and
that the Company took every adaptive management option reasonably available.
DISCUSSION AND DECISION
7 We appreciate Staff s careful review of the requirements in prior Commission orders for
compliance with biennial gas conservation targets and the provisions for decoupling
targets. However, we decline to adopt Staff s recommendations to assess Avista with
penalties for noncompliance with Commission Order 05 in consolidated Dockets UE-
140188 and UG-140189, pursuant to the penalty provisions of Order 09 in consolidated
Dockets UE-190334, UG-190335, and UE-190222. As a preliminary matter, we find that
Avista has complied with the biennial reporting requirements in Order 01,6 Docket UG-
210827,by timely filing a biennial conservation report with sufficient detail to allow the
Commission to determine how Avista is performing compared to its conservation targets.
8 We acknowledge that, as stated in Staffs comments on gas biennial conservation reports,
2022-2023 were difficult years for conservation achievement.We find that the lingering
economic effects of the COVID-19 pandemic have persisted to cause challenges, outside
of the Company's reasonable control, such as customer financial challenges; changes in
customer demand; and labor and supply chain shortages. These elements added to the
5 The Commissioners present at the August 22,2024,Recessed Open Meeting included Chair
Dave Danner,who has since retired as the issuance of this decision,but voted to approve this
Order 02, at the August 22,2024,Recessed Open Meeting.
6 In the Matter of Avista Corp. d/b/a Avista Utils. 2022-2023 Biennial Acquisition Target Under
RCW 80.28.380, Docket UG-210827, Order 01 at 6, ¶23 (Jan 18. 2022).
Dockets UE-190905,UE-190912 &UE-190908, Commission Staff Comments Regarding
Electric Utility Conservation Achievements Under the Energy Independence Act(Staff
Comments) (July 1,2022).

DOCKET UG-210827 PAGE 4
ORDER 02
already significant challenges utilities faced in achieving the remaining conservation in
the region.
9 The Commission has discretion to impose or not impose penalties.8 Our intent in
approving decoupling goals is to encourage conservation. Although Avista failed to meet
its decoupling target, we find that there exist sufficient circumstances to allow Avista to
be "considered in compliance."We therefore find it appropriate to exercise such
discretion for Avista's decoupling targets in a manner that is consistent with the standard
provided in RCW 19.285.040(1)(e).
10 As a result, notwithstanding the Company's failure to comply with Order 05 in
consolidated Dockets UE-140188 and UG-140189, the Commission finds it appropriate
to forgo issuing a penalty here due to the totality of the circumstances.
11 On this point, and for future clarity, we find it appropriate to amend Order 09 in
consolidated Dockets UE-190334, UG-190335 and UE-190222, and Order 01 in this
matter, to clarify that it is our intent that not only might the penalty provisions associated
with the EIA apply to decoupling targets, but so too do the exemptions under RCW
19.285.040(1)(e).9 Notice shall be issued to interested parties so as to allow an
opportunity to comment on these proposed amendments.
FINDINGS AND CONCLUSIONS
12 (1) The Commission is an agency of the state of Washington vested by statute with
the authority to regulate the rates, rules, regulations,practices, accounts,
securities, transfers of property and affiliated interests of public service
companies, including electric companies.
13 (2) Avista is a gas company and a public service company subject to Commission
jurisdiction. Avista is subject to the conservation reporting requirements of RCW
80.28.380; Order 01 in Docket UG-210827; and to Order 09 in consolidated
Dockets UE-190334, UG-190335, and UE-190222.
8 MCI Metro Access Transmission Servs., Inc. v. U.S. West Commc'n, Inc., Docket UT-971063,
Commission Decision and Final Order Denying Petition to Reopen,Modifying Initial Order, in
Part, and Affirming,in Part(1999).
9 The Commission proposes amending paragraph 98 in Dockets UE-190334,UG-190335,&UE-
190222, and paragraph 22 of Order 01 in this Docket.

DOCKET UG-210827 PAGE 5
ORDER 02
14 (3) On May 31, 2024, Avista filed its Biennial Conservation Report, which showed
that Avista complied with the biennial reporting requirements in Order 01 of
Docket UG-210823.
15 (4) Avista achieved 1,263,481 therms of its 2022-2023 biennial conservation target of
2,302,056 therms, a deficit of 1,263,481 therms. As a result, Avista is not in
compliance with the biennial conservation targets accepted in Order 01 of this
docket, in accordance with RCW 80.28.380
16 (5) For the 2022-23 biennial, after applying 0 therms to its 2022-2023 decoupling
commitment of 109,622 therms, Avista has a deficit of 109,622 therms.
Therefore, Avista has not complied with its natural gas conservation decoupling
mechanism, pursuant to Order 09 in consolidated Dockets UE-190334, UG-
190335, and UG-190222.
17 (6) The Commission is not required to penalize a Company for violation of an order;
the Commission finds it appropriate to exercise this discretion for gas companies
using a standard equivalent to the one used for electric companies in RCW
19.285.040(1)(e).
18 (7) Pursuant to the standard set in RCW 19.285.040(1)(e), the Commission may
determine that a utility is considered in compliance with its biennial acquisition
target for cost-effective conservation if events beyond the reasonable control of
the utility that could not have been reasonably anticipated or ameliorated
prevented it from meeting the conservation target.
19 (8) The COVID-19 pandemic, and the changes to the economic landscape that
followed, created circumstances beyond the control of Avista that interfered with
the Company's ability to meet its conservation targets.
20 (9) After reviewing Avista 's report and Staff s comments, and giving due
consideration to relevant matters, the Commission finds that Avista took adequate
adaptive measures to attempt to ameliorate the effect of the pandemic on its gas
conservation efforts. Because the Commission would find these efforts sufficient
given the circumstances if this matter was for an electric utility governed by RCW
19.285.040(1)(e), the Commission finds that no penalty is warranted at this time
for Avista's failure to meet its decoupling commitment in the 2022-23 biennial
period.

DOCKET UG-210827 PAGE 6
ORDER 02
21 (10) This matter came before the Commission at a recessed open meeting on August
22, 2024.
22 (11) In order to clarify the Commission's discretion, it is appropriate to modify
inconsistent mandatory language contained in Order 09 in consolidated Dockets
UE-190334, UG-190335, and UE-190222, and Order 01 in this matter. Notice
shall be given to interested parties prior to such amendments go into effect.
ORDER
THE COMMISSION ORDERS:
23 (1) The Commission accepts Avista Corporation d/b/a Avista Utilities' 2022-2023
Biennial Report of Conservation Accomplishments and determines that it
complies with the conditions of Order 01.
24 (2) The Commission shall reject Staff s recommendation to assess Avista
Corporation d/b/a Avista Utilities with penalties for its failure to comply with
Commission Order 01 of this docket and shall not assess Avista Corporation d/b/a
Avista Utilities any penalties for noncompliance.
25 (3) The Commission shall issue notice to amend Order 09 in consolidated Dockets
UE-190334, UG-190335 and UE-190222, and Order 01 in this matter, to clarify
that it is our intent that similar provisions to RCW 19.285.040(1)(e) apply to the
gas conservation targets and natural gas decoupling commitment.
26 (4) This Order shall not affect the Commission's authority over rates, services,
accounts, valuations, estimates, or determination of costs, on any matters that may
come before it.
DATED at Lacey, Washington, and effective January 31, 2025.
WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION
zs�
ANN E. RENDAHL, Commissioner

DOCKET UG-210827 PAGE 7
ORDER 02
MILTON H. DOUMIT, Commissioner