20161110final_order_no_33645.pdf

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF AVISTA CORPORATION'S )
Office of the Secretary
Service Date
November IO, 2016
ANNUAL UPDATE TO LOAD AND GAS ) CASE NO. AVU-E-16-07
FORECASTS AND LONG-TERM CONTRACTS )
FOR ITS INCREMENTAL COST INTEGRATED )
RESOURCE PLAN A VOIDED COST ) ORDER NO. 33645
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 to calculate avoided cost rates paid to certain PURP A
qualifying facilities (QFs). The avoided cost rate is 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 15 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 PURP A contracts that have terminated
or expired in each utility's load and resource balance.
Order No. 32697 at 22.
On October 14, 2016, per the Commission's directive, Avista Corporation submitted
its annual updates for fuel prices and load forecasts. The Company also provided an update
about new and expiring contracts.
COMPLIANCE FILING
Avista's most recent load forecast was developed in July 2016 for energy, and
September 2016 for peak. The recent energy load forecast remains, on average, a 0.5 percent
annual average growth rate. The peak forecast growth rate decreased from 0.6 percent to 0.4
percent.
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Avista's most recent Forward Price Curve was developed using a blend of two
national price forecasting consultants' most recent forecasts and forward market prices as of
September 14, 2016. A vista did not sign any new long-term power purchase agreements since
its 2015 annual update filing, but did extend one Washington State PURPA hydro facility
contract.
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 FINDINGS
The Commission has jurisdiction over A vista and the issues raised in this matter
under Title 61 of the Idaho Code and PURP A. The Commission has authority under PURP A
and FERC regulations to set avoided costs, to order electric utilities to enter into fixed-term
obligations for the purchase of energy from QFs, and to implement FERC rules. Also, the
Commission is empowered to resolve complaints between QFs and utilities and to approve QF
contracts.
Pursuant to this authority, we have reviewed and considered the record in this case,
including A vista's filing and Staffs recommendation. We find that Avista's filing complies with
the directives issued by this Commission in Order Nos. 32697 and 32802. Based on our review
of the totality of the updates, we accept the updated inputs to A vista's IRP avoided cost
calculation for filing.
ORDER
IT IS HEREBY ORDERED that Avista Corporation's annual update to its load and
gas pnce forecast and long-term contract status for purposes of its incremental cost IRP
methodology are accepted, effective October 15, 2016.
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. Within seven (7)
ORDER NO. 33645 2
days after any person has petitioned for reconsideration, any other person may cross-petition for
reconsideration. See Idaho Code § 61-626.
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this /0~
day ofNovember 2016.
R, CO MissioNER
ERIC ANDERSON, COMMISSIONER
ATTEST:
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ORDER NO. 33645 3