20260728Final_Order_No_37109.pdf

Office of the Secretary
Service Date
July 28,2026
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF COMMISSION ) CASE NO. IPC-E-26-13
STAFF'S APPLICATION TO UPDATE )
INPUTS TO THE SURROGATE )
AVOIDED RESOURCE ("SAR") MODEL ) ORDER NO. 37109
AND SAR-BASED AVOIDED COST )
RATES )
On May 5, 2026, Commission Staff ("Staff') applied to the Idaho Public Utilities
Commission ("Commission") requesting the Commission issue an order updating inputs to the
Surrogate Avoided Resource ("SAR") Model of Idaho Power Company ("Company"), approving
the resulting SAR-based avoided cost rates, and establishing a new processing timeline for the
annual update ("Application").
On June 12,2026,the Commission issued a Notice of Application and a Notice of Modified
Procedure setting written comment deadlines. Order No. 37068. The Company filed comments.
The Commission received no other public comments or Staff reply comments.
Having reviewed the record in this case,we now issue this Final Order updating the inputs
to the SAR Model and SAR-Based avoided cost rates for the Company and establishing a new
timeline for future updates.
BACKGROUND
The Commission calculates and publishes SAR rates for qualifying facilities that are under
the applicable resource type project eligibility cap.' In Order No. 32697, the Commission found
that the final release of U.S. Energy Information Administration's("EIA")Annual Energy Outlook
automatically triggers a re-calculation of published avoided cost rates. In Order No. 32802, the
Commission clarified that an update should occur on June 1 or within 30 days of the final release
of the Annual Energy Outlook,whichever is later.Following the issuance of Order Nos. 32697 and
32802, Staff annually updated natural gas price inputs into the SAR Model and a Staff attorney
sent a letter to the Company requesting the Company verify that Staff had correctly updated and
calculated the published avoided cost rates. The letter was filed with the Commission and served
to open the docket for the annual updates. Historically,Notices of Application were not issued for
'For projects that exceed the eligibility cap for SAR rates the Commission uses Integrated Resource Plan rates.
ORDER NO. 37109 1

these cases because "this annual update is a simple arithmetic re-calculation to an established
methodology that is accomplished administratively as a matter of course." Order No. 34350 at 1
citing Order Nos. 33305, 33538, and 33773.
In 2020, the Commission approved a more formal process to update inputs to the SAR
Model. Order No. 34628. The Commission stated, "[s]ubsequent annual SAR updates will be
initiated with an Application to the Commission. Despite the change in procedure to allow for
better tracking and transparency, this update is still intended to be a simple arithmetic calculation
to an established methodology."Id. at 1.
THE APPLICATION
Staff requested that the Commission approve the proposed annual update to SAR-based
avoided cost rates for qualifying facilities under the Public Utility Regulatory Policies Act of 1978
("PURPA") based on inputs to the SAR Model using the natural gas price forecast from the
Mountain Region Reference Case in the EIA's Annual Energy Outlook.Application at 1.
The EIA published its Annual Energy Outlook on April 8, 2026.Id. at 2. Staff stated that it
used the published natural gas price forecast through 2050 to update the SAR Model. Id. Because
the SAR Model is designed to calculate 30 years of avoided cost rates while the Annual Energy
Outlook currently forecasts only 25 years, Staff's proposed SAR Model extrapolates the EIA's data
to create values for the unforecasted years. Id. Staff attached its proposed SAR Model and the
resulting avoided cost rates to the Application. Id. at 2-3.
Staff also requested that the Commission establish a new processing timeline for the annual
update to the SAR Model,as progressively delayed EIA publishing dates make it difficult to adhere
to the Commission's previously established timeline for the update. Id. at 3. Staff recommended
that the new timeline,which would apply to updates for all Commission-regulated electric utilities,
require Staff to initiate the annual update case within one month of the EIA's Annual Energy
Outlook publishing date, with an effective date of three months following the publishing date.Id.
COMPANY COMMENTS
The Company filed comments expressing support for Staff's proposed published avoided
cost rates and new processing timeline for annual SAR update cases.
COMMISSION FINDINGS AND DISCUSSION
The Commission has jurisdiction over this matter under Idaho Code §§ 61-501, 61-502,
and 61-503. The Commission has the power to "supervise and regulate every public utility in the
ORDER NO. 37109 2

state and to do all things necessary to carry out the spirit and intent of the [Public Utilities Law]."
Idaho Code § 61-501. The Commission also has authority under PURPA and the implementing of
regulations of the Federal Energy Regulatory Commission("FERC")to set avoided costs,to order
electric utilities to enter fixed-term obligations for the purchase of energy from qualifying
facilities, and to implement FERC rules.
Having reviewed the record,we find that Staff correctly calculated the annual updates using
the Commission-approved method, and we find that the updated published avoided cost rates are
fair, just, and reasonable. Future update cases shall be initiated within one month of the EIA's
Annual Energy Outlook publishing date, with an effective date of three months following the
publishing date.
ORDER
IT IS HEREBY ORDERED that the updated SAR Model and SAR-Based avoided cost
rates contained in the Application for the Company are approved, effective June 1, 2026. Future
update cases shall be initiated within one month of the EIA's Annual Energy Outlook publishing
date, with an effective date of three months following the publishing date.
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within twenty-one (21) days of the service date upon 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. 37109 3

DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 28th day of
July 2026.
G o
EDWARD LODGE, PR IDENT
J R. HAMMOND JR., COMMISSIONER
DAYN HA IE, COMMISSIONER
ATTEST:
Monica bare Sanchez
Commission Secretary
I:\Legal\ELECTRIC\IPC-E-26-13_SAR\orders\IPCE2613_final_cb.docx
ORDER NO. 37109 4