20250701Final_Order_No_36661.pdf

Office of the Secretary
Service Date
July 1,2025
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF IDAHO POWER ) CASE NO. IPC-E-25-07
COMPANY'S 2024 VARIABLE ENERGY )
RESOURCE STUDY AND PROPOSED )
UPDATE TO SCHEDULE 87 ) ORDER NO. 36661
On February 27, 2024, Idaho Power Company ("Company") petitioned the Idaho Public
Utilities Commission ("Commission") requesting authority to modify a compliance requirement
from Order No. 36048, issued in Case No. IPC-E-23-14, regarding updating the Company's
Schedule 87, Intermittent Generation Integration Charges ("Schedule 87"). Case No. IPC-E-24-
08.
The Company requested that the Commission modify the Company's compliance
requirement to: (1) authorize the Company to update Schedule 87 integration costs based on the
forthcoming 2024 Variable Energy Resource ("VER") study, instead of the 2020 VER study; and
(2) authorize the Company to file both the forthcoming 2024 VER study and updated Schedule 87
no later than December 31, 2024. Case No. IPC-E-24-08.
On June 10, 2024, the Commission issued Order No. 36219, granting the Company's
request to modify the compliance requirement in Order No. 36048, and directed the Company to
file both the 2024 VER study and updated Schedule 87 proposed rates no later than December 31,
2024. Order No. 36219 at 2. On December 31, 2024, the Company submitted a compliance filing
with its 2024 VER study and updated Schedule 87 proposed rates.
On February 18, 2025, the Commission issued Order No. 36466 in Case No. IPC-E-24-08
ordering a new docket be opened to consider the Company's proposed update to Schedule 87 rates.
On March 14, 2025, the Commission issued a Notice of Filing and Notice of Intervention
Deadline. Order No. 36510. No petitions to intervene were filed.
On April 22, 2025, the Commission issued a Notice of Modified Procedure, establishing a
May 14,2025,deadline for public and Commission Staff("Staff')comments,and a May 21,2025,
deadline for the Company to file reply comments. Order No. 36544. No public comments were
received.
ORDER NO. 36661 1

Based on our review of the record,the Commission now issues this Final Order approving
Schedule 87 with Staff s proposed modifications and directing the Company to work with Staff on
several issues when conducting future VER studies.
STAFF COMMENTS
Staffs review of the Company's proposed Schedule 87 focused on the overall
methodology, capital and fixed operation and maintenance ("O&M") cost of incremental
resources, the portfolio choice, the lack of an inter-hour analysis, the regulation reserve
requirements, the analysis of on-site generation, the penetration levels, the portfolio results, the
integration charges, the filing time, and the effective date. Staff Comments at 2.
Staff stated that after the Company ran the AURORA model, the Company calculated
average integration costs in 2024 dollars. Id. at 8. Staff believed there was a mismatch between
the cost data and energy data. Id. Staff stated that the cost data was based on a 20-year model run
that started in 2024,whereas the incremental energy was based on a 19-year calculation that started
in 2025. Id. Because 2024 has passed, Staff believed the cost and energy data should be aligned
based on 19 years. Id. Staff recommended that the Commission approve the non-levelized
integration charges for Schedule 87 in Attachment No. 1 to Staff comments.Id. at 9.
Staff noted that the Company only proposed levelized integration charges for contracts
with a term of 20 years. Id. at 9. Staff developed and proposed integration charges for contracts
ranging from one year to 20 years in Attachment No. 1 to its comments, using a discount rate of
7.247%,which Staff stated was approved for the Company's Surrogate Avoided Resource Model.
Id. at 10. Staff recommended the levelized integration charges in Attachment No. 1 to Staff
comments for Schedule 87. Id.
Based on its review of the 2024 VER study, Staff recommended that the Commission order
the Company to work with Staff and resolve the following issues prior to the next VER study:
1) How to determine capital and fixed O&M cost of incremental resources;
2) Whether it is reasonable to include an analysis of inter-hour integration costs in the
next study and whether inter-hour integration costs should be incorporated into the integration
charges;
3) Whether Regulation Reserve Requirements should be updated;
4) How to reconcile differences in wind and solar integration cost for Export Credit
Rates ("ECR");
ORDER NO. 36661 2

5) How to address the under-allocation issue for the ECR; and
6) Whether on-site generation can be incorporated in the analysis through developing
a proxy to overcome the issue of data granularity.
Id. at 2-3.
For future VER studies, Staff recommended that the Commission order the Company to
file a new VER study within six months after the filing of each Integrated Resource Plan
using the information from the IRP as a starting point but updating it with the latest information
where possible. Id. at 3. Staff also recommended that, if the Company believes a new VER study
is not necessary,the Commission order the Company to formally seek a waiver for the study,with
evidence supporting the Company's position, within two months after the filing of the IRP. Id.
COMPANY REPLY
The Company believed Staff s proposed integration charges for Schedule 87 were
reasonable. Company Reply at 3.The Company represented that if the Commission adopted Staff s
proposal, the Company would file a compliance filing to revise Schedule 87 to incorporate the
updated integration charges shown in Attachment No. 1 to Staff s comments, with an effective
date of June 1, 2025. Id. The Company also agreed to work with Staff before its next VER study
on the items laid out in Staff s comments. Id. Finally, the Company agreed with Staff s
recommendation for updating its VER study and the process for requesting a waiver if it is
determined an updated VER study is not required.Id.
COMMISSION FINDINGS AND DISCUSSION
The Commission has jurisdiction over the Company's Filing and the issues in this case
under Title 61 of the Idaho Code including, Idaho Code §§ 61-501, -502, and -503. The
Commission is empowered to investigate rates, charges,rules,regulations,practices, and contracts
of all public utilities and to determine whether they are just, reasonable, preferential,
discriminatory, or in violation of any provisions of law, and to fix the same by order. Idaho Code
§§ 61-501, -502, and-503.
The Commission has reviewed the Company's Filing including all submitted materials,
Staff comments, and the Company's Reply Comments. Based on our review of the record,we find
it fair,just, and reasonable to approve Schedule 87 with Staffs proposed changes in Attachment
No. 1 of Staffs Comments. The Company shall submit the updated Schedule 87 as a compliance
filing in this case.
ORDER NO. 36661 3

We also find it reasonable to order the Company to work with Staff prior to the next VER
study and attempt to resolve Staff s listed outstanding issues.Accordingly,we direct the Company
to file a new VER study within six months after the filing of each IRP. Should the Company believe
a new VER study is not necessary, the Company shall formally seek a waiver with evidence
supporting the Company's position within two months after the filing of the IRP.
ORDER
IT IS HEREBY ORDERED that Schedule 87 is approved with Staff s proposed
modifications in Attachment No. 1 to Staff s Comments.
IT IS HEREBY ORDERED that the Company shall submit the updated Schedule 87 as a
compliance filing in this case.
IT IS HEREBY ORDERED that the Company shall work with Staff prior to the next VER
study and attempt to resolve issues cited in Staffs comments.
IT IS HEREBY ORDERED that the Company shall file a new VER study within six
months after the filing of each IRP. Alternatively, should the Company believe that a new VER
study is unnecessary, the Company shall file for a waiver of the VER study with evidence
supporting the Company's position within two months after the filing of the IRP.
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within twenty-one(21) days of the service date of this Order regarding any matter
decided in this Order. Within seven (7) days after any person has petitioned for reconsideration,
any other person may cross-petition for reconsideration. See Idaho Code § 61-626.
ORDER NO. 36661 4

DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 1st day of
July 2025.
C
EDWARD LODGE, P ESI NT
tAYNH
HAM
JR., COMMISSIONER
COMMISSIONER
ATTEST:
I JJQOV�
M mca Ba s- hez
Commission Secretary
I:\LegahELECTRICUPC-E-25-07_Sch MordersUPCE2507_final_em.docx
ORDER NO. 36661 5