20141121final_order_no_33181.pdf

Office of the Secretary
Service Date
November 21,2014
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF AVISTA )
CORPORATION’S ANNUAL UPDATE TO )CASE NO.AVU-E-14-11
LOAD AND GAS FORECASTS AND LONG-)
TERM CONTRACTS FOR ITS )
INCREMENTAL COST INTEGRATED )ORDER NO.33181
RESOURCE PLAN AVOIDED COST )
METHODOLOGY.)
Pursuant to the Public Utility Regulatory Policies Act of 1978 (PURPA)and the
implementing regulations of the Federal Energy Regulatory Commission (FERC),the Idaho
Public Utilities Commission (Commission)has approved an incremental cost Integrated
Resource Plan (IRP)methodology for the calculation of avoided cost rates paid to certain
PURPA qualifying facilities (QFs).Avoided cost rates are the purchase price paid to QFs for
purchases of QF energy and capacity.
In Order Nos.32697 and 32802,the Commission determined that the load forecast
and natural gas forecast inputs to the IRP avoided cost methodology should be updated annually
on October 1 5 of each year.The Commission stated
We find that,in order to maintain the most accurate and up-to-date reflection
of a utility’s true avoided cost,utilities must update fuel price forecasts and
load forecasts annually —between IRP filings....In addition,it is
appropriate to consider long-term contract commitments because of the
potential effect that such commitments have on a utility’s load and resource
balance....We further find it appropriate to consider PURPA contracts that
have terminated or expired in each utility’s load and resource balance.
Order No.32697 at 22.
On October 22,2014,pursuant to the Commission’s directive,Avista Corporation
(Avista)submitted its annual updates for fuel prices and load forecasts.The Company also
submitted information regarding new and expiring contracts.
COMPLIANCE FILING
Avista reports that its most recent load forecast was developed in July 2014 for
energy and September 2014 for peak.The recent energy load forecast shows,on average,a 0.6%
annual average growth rate,down from 0.7%.The peak forecast growth rate is unchanged at
0.7%.
ORDERNO.33181 1
Avista’s most recent Forward Price Curve was developed using the blend of two
national price forecasting consultants’most recent forecasts and forward market prices as of
October 7,2014.
The Company reports that it has signed one new long-term power purchase
agreement,representing a 4%slice of Chelan County PUD’s Rocky Reach and Rock Island
production for the 2015 calendar year.The slice product is expected to add 64.5 megawatts
(MW)of peak capacity for both summer and winter peaks and add 35.4 average megawatts
(aMW)of energy.As of its filing date,Avista has no additions or subtractions of PURPA
resource contracts.
STAFF REVIEW
Staff reviewed the Company’s forecast and contract updates.Staff reported that the
load and gas price forecasts submitted by Avista reflect the Company’s most current estimates
and were prepared consistent with the methods used in the Company’s IRP.Staff maintained
that the load and gas price forecasts and the long-term contract changes submitted by the
Company comply with the requirements of Order Nos.32697 and 32802.Staff recommended
that the Commission accept the forecasts and contract changes without further process.
DISCUSSION AND CONCLUSIONS
The Commission has jurisdiction over Avista pursuant to the authority and power
granted it under Title 61 of the Idaho Code and Public Utility Regulatory Policies Act of 1978
(PURPA).The Commission has authority under PURPA and the implementing regulations of
the Federal Energy Regulatory Commission (FERC)to set avoided costs,to order electric
utilities to enter into fixed-term obligations for the purchase of energy from qualified facilities
and to implement FERC rules.The Commission is also empowered to resolve complaints
between QFs and utilities and approve QF contracts.
Pursuant to its authority,the Commission has reviewed and considered the filings of
record.We find that Avista’s filing complies with the directives issued by this Commission in
Order Nos.32697 and 32802.Based upon our review of the totality of the updates,we accept
the updated inputs to Avista’s IRP avoided cost calculation for filing.
ORDERNO.33181 2
ORDER
IT IS HEREBY ORDERED that Avista’s annual update to its load and gas price
forecast and long-term contract status for purposes of its incremental cost IRP methodology are
accepted,effective October 15,2014.
THIS IS A FINAL ORDER.Any person interested in this Order may petition for
reconsideration within twenty-one (2 1)days of the service date of this Order.Within seven (7)
days after any person has petitioned for reconsideration,any other person may cross-petition for
reconsideration.See Idaho Code §6 1-626.
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this /
day of November 2014.
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MACK A REDF,ORD,COtMMISSIONER
MARSHA H.SMITH,COMMISSIONER
ATTEST:
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Jèàn D.Jewefl(I
Commission Secretary
O:AVU-E-14-1 1_ks
PAUL SIDENT
ORDERNO.33181 .3