20210429Avista Updated 2021 Electric IRP.pdf

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Avista Corp.
141 I East Mission P.O.Box3727
Spokane. Washingto n 99220 -050[.t'
Telephone [phone]
Toll Free 800-727-9170
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April29,202l iJ:1
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Jan Noriyuki, Secretary
Idaho Public Utilities Commission
1 1331 W. Chinden Blvd. Bldg. 8, Ste. 201-A
Boise,Idaho 83714
RE: Case No. AVU-E-21-04
DearMs. Noriyuki:
On March 31,2021, Avista Corporationdlbla/ Avista Utilities (Avista or the Company), filed its
2021 Electic Integrated Resource Plan (IRP). Within the IRP the Company noted thatis issued a
request for proposals (RFP) to acquire up to 120 aMW of clean enerry in the summer of 2020 utd
the outcome of the RFP may necessitate an update of the IRP. On March 24,2021, just priorto
filing the 2021 Electic IRP, Avista signed a 1O-year contract with Chelan PUD for a 5 perce,nt
(slice) of its Rocky Reach and Rock Island hydro facilities. Enerry deliveries will begin Januaryl, 2024 at a fixed price over the contract term. The new Chelan PUD hydro slice adds
approximately 5l aMW under average water conditions and 88 MW of nameplate capacig2.
Avista estimates the contract will decrease its system peak planning requirements by 53 MW,
serving b oth Id aho and Washington jurisdictions.
As a result of the new resource acquisition there were impacts on resource selecfion, cost, and
emissions relative to the 2021 IRP's Preferred Resource Statery and Clean Enerry Action Plan.
Because of these impacts the Company herSy submits for filing with the Commission an updabd
Preferred Resource Stratery and Clean Enerry Action Plan to its 2021Electric IRP. Supporting
documents can be found on our website at https://myavista.com/about-us/intesrated-resource-
plannine.
If you have any que$ions regarding this filing please contact James Gall at 509-495-2189 or John
Lyons at509-495-8515.
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Estimated Avoided Costs
Encrgy Only Value Assumlng Flat Deliyery All Hours ln a Year - Example Rates For Large QF Resources, ltot Applieable to Small (
Houdy Values (f/MWh)
to.65
69.24
66.35
12.60
1.6.72
55.99
43.02
59.87
Capacity Only Value Assuming Flat Delivery All Hours in a Year - Example Rates For Large OF Resources, Not Applicable to Small QF
Hourly Values (lrMtVh)
HLH 2t2l 20i22 2023 2024 20i2s ?o25 7t27 2024 2029 2030 2031 2t l2 20:13 zffi,2o:t!i 2035 mr7 203E 20!t9
Jan 24.43 25.73 22.6L 2L.92 23.76 2734 31.85 32.82 35.03 35.93 36.79 37.33 38.90 40.33 42.17 43.74 45.51 47.52 49.40
Feb 20.20 20.90 18.70 77.t2 20.23 22.29 25.99 26.54 28.3S 24.52 29.10 30.06 32.68 33.34 34.53 35.22 38.tt4 97.46 38.15
Mat 77-29 18.O9 76.87 17.88 t7-25 t7-71 21,-75 21.95 25.3s 75.62 33.38 37.OS 38./t4 t7-72 48.31 54.s9 47.3s 42.79 39.77
Aor 77.27 11.54 12.50 ls.27 17.03 18.98 17.25 13.17 L3.44 14.76 16.03 20.il 18.S7 L7.23 27.42 16.94 13.66 12.47 6.94
Mav 4.19 4.27 s.38 3.73 1.90 1.88 (3.041 ls.79l {4.921 |.6.97 (8.35 {6.48 {8.lt8}(8.98)17.66 (8.96 (9.831 19.12)(10.93)l (
.lun L2.90 13.08 71-26 15.20 11.82 11.44 10.17 4.05 3.S0 {1.19 (5.18 |,4.17 {4.591 14.141 14.61 //6.21 t7.00 t7.06l (7.1411
lul t7-61 18.71 19-S4 20-11 ,t.tl )2.61 77-O7 2S.m 26.30 27.67 24-41 27.72 4 .11 20.3a 16-A7 1S.73 ts-72 16_06 13.t6
Aua 23.01 24.46 24.94 25.02 78.U 28.72 33.69 31.21 32.73 34.26 34.16 34.97 v.u 35.77 36.12 47.79 39.30 39.63 37.60
SeD 2,.49 22.L8 24.4A 22.95 2S.95 27.71 31.76 29.25 30.17 30.38 30.56 32.42 33.92 33.38 33.39 3S.20 35.83 38.12 43.03
Oct 19.43 20.01 21.74 20-17 23.53 23.91 27.48 74-91 27.O7 24.57 27_OA 29_20 11,.42 12.22 33.31 14_74 17.47 38.73 48.08
Nov 18.66 lq.g!l 1,'.\4 79.75 2.L.?7 25,/O 27.33 27.27 30.10 29.68 37.47 31.25 14.24 37.6 41.58 39.99 4.81 48.13 49.28
Dec 24.42 25.90 24.50 26.20 27.78 35.07 x6.o7 35.69 38.04 34.24 40.61 4L.41 it4.23 47.L4 50.75 50,05 52.85 58.36 54.13
tLH 20i21 2022 2023 2024 202t 2026 2027 2028 2029 20t0 203r 2032 2033 20:t4 2035 2035 203t 2038 2039
lan 20.71 22.12 19.32 19.54 20.17 24_06 30.78 31.48 34_35 39.39 14.92 36.37 37.O2 39.20 42-45 43.S5 M.74 45.5S 47.59
Feb 17-12 18.01 1q.91 1S-42 18-77 2t.ol 26.28 26.39 28.74 28.15 29.42 29.70 34.09 33.72 34.94 35.81 41.06 42.65 42.86
Mar 12.67 72.97 12.55 13.82 14.80 t6.7r 22.94 22.88 27.96 32.58 43.05 51.43 49.90 62.49 66.45 74.05 73.54 71.61 70.r7
Aor 9.85 10.07 tt.il 15.53 20.54 22.57 25.tS 23.33 26.47 29.06 28.74 36.57 29.27 28.86 35.05 32.80 27.OO 33.24 21.58
Mav (5.621 (3.591 (1.s41 (8.S61 ls.44l (\.7Ll 18.231 111_s8l l12.171 (1s.6sl (19.621 (13_s5l (19_161 171.771 /,70.421 (22.t81 124.601 117.581 123.3311 {
Jun 5.82 7.69 7.54 3.33 8.O?4.94 0.85 (5.18)(7.39)(11.2s)(16.13)(14.s41 (L4.671 (16.46)(18.29)(19.831 (18.s9)(17.50)(16.3e)l (
Jul 14.09 14.22 13.93 13.50 15.78 19.31 19.61 t9.28 20.22 20.06 20.91 22.@ 23.4S 21.23 20.64 t7.99 17.42 18.88 18.60
Auc 14.77 15.40 15.23 ls.77 14.76 19.88 25.27 23.49 2S.04 29.39 31.29 33.61 11_71 36.75 34.58 39.95 M.99 46.68 46.44
Seo 71.46 13.34 16.22 1t.s6 19.)6 27.O)19.52 25.43 28.78 27.79 3t.75 31.20 35.18 34.35 38.87 40.77 46.15 45.09 53.14
Oct 72.67 12.69 t4.42 t4.t4 15.60 17.29 2t.17 20.76 22.52 23.99 26.54 2't.u 31.46 33.27 36.09 37.82 47.42 40.58 48.61
Nov 13.67 74.97 13.15 13.95 15.95 22.33 23.72 21.39 26.O7 25.08 29.10 30.37 32.29 34.38 37.45 35.01 38.20 41.50 41.83
Dec 19.21 20.74 18.35 20.77 22.71,28.81 29.97 31..29 33.81 14.24 37.24 39.58 40.73 43.03 M.7l 43.74 49.43 53.45 57.42
202L 2022 20i21 2m4 20:15 20it6 2U27 20[.A 2029 2030 ztxt1 2032 20813 20,,2035 m36 ,fB'2038 20t9
13.10 13.17 13.64 13.91 14.18 ,4.47 ,4.77 15.05 15.36 15.66 75.97 16.29 16.52 16.95
1. HtH (heavy load-hours) are defined as 6:00 am until 10:00 pm all days. LLH (light load-hours) are defined as all other hours.
2. Rate does not include adjustments for variable energy resource integration charges.
3. Capacity value is applied to all delivered enerBy during a calendar year.
Estimated Avoided Costs
Combined En€rgy and Capaclty Valuo As3uming Flat Dollvery All Hours in a Year - Example Rates For Large QF Rerources, Not Applicable t
Hourly Values ($rMVt h)
2(
2C
HIJ{202L 20i,3 2lJ,24 2ol5 2026 2027 2028 2@ 2tB0 2031 2Grt 2033 2(Btl 2035 2035 2,)!7 203t 2039 2o{o2022
61 AA 63.42 66 0'.lan 24.43 25.71 22.61 21.92 23.26 2734 M.95 45.18 44.67 49.E4 50.9E 51.E0 53.57 55.3E 57.53 59-.10 67.43
Feb 20.20 20-90 14.70 t7_L2 20.23 22.29 39.10 39.91 41.99 17-43 43.28 44.53 47.45 48.39 49.89 50.89 54.42 53.75 54.78 56.47
Mer 77 29 16.47 t7-a8 17.25 77-73 :t4.85 35.31 38.9'39_53 47.57 st-s2 53.21 62.L7 61.67 70..26 63.32 59.08 56.40 51.8218.05
Aor 77.27 12.9 15.27 17-O1 18.98 30.35 26.53 27.d8 aa_67 30-21 35.11 33.33 3)..44 36.75 32.60 29.63 29.16 23.56 18.3311.54
1.90 1_88 10.05 7.58 a.77 6.9L 5.84 7.99 6_29 6.07 7-70 6_71 6.14 7.17 5.69 s.27Mav4.L9 4.27 5.38 3.7'
11 4l )1_L7 17.42 t7.t!12.77 90,to 15 10 1A to71 10.79 9.43 8.98 !t.23 9-r!8 9.16Jun12.90 13.O8 13.26 15.20 LL.82
32 35Jult7-6!1A-77 19.54 20.21 zt.3t 22.63 40.12 38.36 39.93 41.53 38.59 41.69 ?9.O7 35.39 12.23 31.39 31.19 29.98 28.95
Au[23.O1 74.t6 24-94 25.O2 28.64 28.72 46.80 44.57 46.27 48.17 48.35 49.44 49.61 50.82 51.48 57.46 ss.z7 55.92 54.23 57.@
Sao 21 A9 2L.ae 22-95 2S.95 27.71 44.46 12.6L 43.81 44.29 44-74 45.89 48.69 48.43 44.75 50.87 s1.81 54.41 59.6S 60.1322.La
23_S3 23-91 40.98 3;8.77 io-71 t2-til il1-19 tl-67 46.19 a7-a7 i4E-67 50_rt4 s3.45 55_O2 64.70 61.92Oct19.43 20.01 21,.13 20.37
40,4i 40-63 \2 71 56-ltt ss.6s 60.80 il.47 65_90 5t.11Nov18.66 19,83 18.54 L9.75 21.?7 25.40 43.74 43.59 45.66 45.72 49.00
74-65 80.75Dec24.42 25.90 24.50 26.20 27.78 35.O7 49.18 49.06 51.68 52.15 y.79 55.88 58.99 62.19 66.11 65.73 68.83 86.20
2025 2026 2027 2024 2029 20lo 2031 2,)t2 2033 2034 203s 2036 2037 2038 2039 2o4oul{zutt 2022 202t 2024
lan 20.71 27.12 19.32 19.54 20.37 24.06 43.88 44.85 47.99 49.30 49.L|50.84 51.79 54.25 57.81 59.21 60.77 62.85 64.27 66.62
Feb 77 73 18 01 1S.E1 75-42 18.11 2t.ot 39.38 39.76 42.37 42.06 43.61 M.t7 48.86 4A.77 50.30 51.48 57.03 58.94 59.48 61.54
Mar 13.82 14_80 16.71 36.05 35.25 41.59 46.50 57.24 55.90 64-66 77.54 81.80 49.72 89.51 87.90 86.79 83.3012.67 12.9r 12.55
20.sL 22.57 38.25 36_69 40_51 47.97 L2.97 51.04 44_03 43.91 51.41 4A.47 42.97 49.S3 38.20 29.55Apr9.85 10.07 17.64 15.53
ts 741 4.A7 1.79 7.[7 11 7Ll (4 401 16.22\l5.06l 16.771 18.631 t1.281 16.711 (6.381Mav6.62 (3.591 (1.541 (8.95)(s.44)(s.43)0.92
11.211 023Jun6.82 7-69 7.54 3.33 8.07 4.94 13.95 8.18 6.25 2.67 (1.95)(0.07)0.10 (1.41)(2.931 A.L7I (2.52)1.16
Jul 14.09 la.22 13.93 13.50 15.78 19.31 32.72 32.6s 33.86 33.97 35.10 37.O7 38.22 36.28 36.00 33.55 33.39 35.t7 35.22 33.07
Aut 74 77 1S.23 75.77 18.76 19.88 38.38 37.25 38.58 43.26 45.48 48.08 48.47 51.80 49.94 55.62 60.96 62.97 63.45 66.8215.40
1S.55 19.26 t9-s2 38.53 35.38 42-42 41.10 45.94 45-67 49.95 49.40 s4.22 56.43 52.13 61.38 69.76 67.50Sep13.45 13.34 t6.32
77.79 1 .27 14.12 36_16 37-90 LO.71 L2.37 L6_77 L4.17 51.45 53.48 57.39 56.87 65.23 72.94Oct12.67 12.69 14.82 L4.14 15.50
t6 83 s2 ao 50 67 54.77 s7.79 58.45 59.97Nov13.67 14.97 13.15 13.95 15.95 22.33 36.76 39.71 39.99 43.29 44.44 47.O5 49.43
69.75 64.44Dec19.21 20.74 18.35 20.77 22.71 28.81 43.08 44,6s 47.M 48.15 51.46 54.15 55.50 58.08 60.o7 59.44 55.40 76.82
l. HtH (heavy load-hours) are defined as 6:00 am until 10:00 pm all days. LLH (light load-hours) are defined as all other hours.
2. After 15 years rates are escalated using growth rate between year 14 and year 15.
3. Rate does not include adjustments for wriable energy resource integration charges.
Schedule 62 QF Avoided Costs
Specified-Term Standard Power & Short-Term Time of Delivery Capacity Rates
Hourly Values ($/MWh)
RCW 80.80.40 Compliant Resources - Contracts Ending after 15 Years
First
Delivery
Year
Hourly Capacity Value <3 Year History 3+ Year
History
S/kW-mo
On-System
Wind
Montana
Wind Solar
Solar +
4Hr Batt Hvdro
Wood
Biomass
Geothermal
(off svsl Other
2022 1.43 5.52 o.75 5.87 14.65 11.55 9.77 8.93 5.s2
202?1.60 6.27 0.84 6.61 16.47 12.99 70.92 10.04 7.33
2024 1.79 5.93 0.94 7.37 18.38 74.49 72.18 77.20 8.18
2025 2.LO 8.13 1.10 8.54 2L.56 17.00 L4.29 L3.14 9.59
RCW 80.80.40 Resources -Contrasts
First
Delivery
Year
Hourly CapaciW Value <3 Year History 3+ Year
History
$/kW-mo
On-System
Wind
Montana
wind Solar
Solar +
4Hr Baft Hydro
Wood
Biomass
Geothermal
(off sysl Other
2022 1.02 3.95 0.54 4.20 10.49 8.27 6.95 6.39 4.67
2021 7.25 4.85 0.56 5.16 72.87 10.15 8.53 7.84 5.73
2024 1.50 5.79 o.78 5.16 15.35 t2.tL 10.77 9.36 6.83
2025 7.92 7.43 1.01 7.90 19.70 15.54 13.05 12.07 8.77
RCW 80.80.40 Non-Compliant Resources - Renewa! Contracts Ending after 5 Years
First
Delivery
Year
Hourly Capacity Value <3 Year History 3+ Year
History
S/kw-mo
On-System
Wind
Montana
Wind Solar
Solar +
4Hr Batt Hydro
Wood
Biomass
Geothermal
(off svsl Other
2022 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
2023 0.40 1.54 o.27 1,.64 4.09 3.23 2.77 2.49 7.82
2024 0.8r 3.15 0.43 3.35 8.36 6.60 5.54 5.10 3.72
2025 1.54 5.97 0.81 6.35 15.84 12.49 10.50 9.66 7.05
1. Capacity payments are based on an annual capacity value multiplied by the standardized
on-peak capacity contribution divided by a standardized capacityfactor, Once QF output
exceeds that of the assumed capacity factor level, capacity payments will cease until the
next contract year,
2. Existing resources with 3 years of operating history will receive a S/tvtWtr payment derived
using the S/kW-mo rate. To convert the S/kW-mo rate to a per-MWh rate, multiply the
S/kW-mo rate by 12 months and multiply it again by the capacity contribution factor
defined in tariff and then divide that figure by the average capacity factor over the same
number of years used to define the capacity contribution factor.
3. On-Peak Capacity Contribution Assumptions <3 Years Operating History:
On-System Wind: 5% Montana Wind: 30% Solar: 2% Solar + 4Hr Battery: 15%
Hydro: 61% Other: 100%
4. Standardized Capacity Factor Assumptions <3 Years Operating History:
On-System Wind: 31% Montana Wind: 49% Solac 24% Solar + 4Hr Battery: 23%
Hydro: 37% Wood Biomass: 77% Geothermal (off-sys): 92%
5. Fixed rate is for contracts ending in 2035. Shorter terms will receive capacity payment
based on value provided over the term of the contract.
6. Capacity contribution payment with batteries is based on the size of the resource itself,
not the summation of the battery and resource. Battery size is assumed to be equal to a
multiple of the underlying resource capacity (e.9., 2 MW solar + 4 hr battery = 8 MWh
battery).
Schedule 62 QF Avoided Gosts
Specified TonrFstandard Powor Energy Rrbs
Hourly Value3 (3rMWh)
z02l mix,m23 m24 NE mfr 2027 8ZA zJ,29 zllto zo31 mtz zoi,/[zI35 m35 m?7 2038 2039 ztao
Irh 7l.LA )\11 ,2.64 aLg7 23.26 27 3A 31.45 32-42 35.O3 34.90 40.33 42.L7 43-74 4S.51 47.52 49.40 so.47
Fcb 20.20 20-90 LA.70 t7.L2 20.23 7) )9 ,s ss )6$28.3s 24.52 29.10 30.06 32.68 33,34 34.53 35.22 39.44 37.46 38.15 39.52
M.r L7.29 18.05 L6.A7 77.44 a7-25 17.73 21.75 21-9S 25-3S )s-62 33-34 37-OS aaA,l 47-a7 rt8-31 sa-s9 47.39 42.79 19.7'{.e7
Aor 17.27 11-54 12-50 L5.27 L7,O3 18,98 17.25 L3.17 13.M 14.76 16.03 20.il 18.57 77.23 27.42 15.94 13.56 72.47 5.94 1.38
M8v 4_19 4.27 5.38 171 1-90 1-88 l3-O4l 15-7!ll lL.g2l 16E lt ?t t6 /t8l lE at la 9!17.*18.96 19_831 lE_121 110.99 tlt 6,
lun 72.9O 1l-oa a3.26 15.20 1L.g2 11--AA 10.37 4.OS 3.SO {1-191 ls.18l 14-321 (4.591 14-3,l 14.611 (6.231 t7.ml (7.061 lt.t4l l7-791
Jul 77.63 Lg-71 19.54 20.21 ,1.97 2) 6a )7 0)25m 26 30 )7 6))a L1 )7 )')L.17 70 "a 76.47 1S.73 15.72 16.06 13.t6 12 ([
Aua 2?.O7 2L.n6 24.9 25.O2 24.il 24.?2 33.69 3r.2L 12.73 31.26 !t4_16 34-97 34.9 35.Tt 96.72 4t.79 39.30 39.63 37.60 40.65
SeD 27.49 22-tg 24.48 22.95 25 qS a7 77 z1_76 )q )s 10 17 qo ql ?o s6 1) L)tq o2 31.?B 3!1.3q 35.20 a5-83 34.12 43.03 a1 1t
od 79_La ,o ol )7.15 20.37 23.S3 23-91 27.A2 24.91 77-O7 2A.52 27"@ 29-20 3L.12 32.22 33.31 ?4.79 37.47 38.73 48.08 44.96
Nov 18.66 19.83 18.54 L9,75 )1 17 )q Li )7 ?1 )7 27 eo ro ,6tr a1 L7 et rq 47L t7 06 41.s0 19.qq aa.e7 48.1E aq.2a qlil
Dcc 24.42 25.90 24,5O 26.20 27.7A 35.07 36.07 35.59 38.04 38.24 40.61 4tal 44.23 47.14 50.76 50.06 52.85 58.36 il.13 69.24
t-]It 2021 2022 m23 2024 202s 2026 2027 2024 m29 2030 2031 20a2 2033 2034 2035 2035 20:17 2038 2039 2040
lan 20.71 27.12 79.32 19.54 20.37 24.06 30.78 31.48 34.35 35.39 34.92 36.37 37.02 39.20 42.45 43.55 44.74 46.55 47.59 49.67
Fcb 77.L3 14.01 15.91 t5.42 18.11 21 07 )a )9 ,6 4q )e7L ,t 1q 29.42 29.70 ?am 1a 7)us4 3S 81 41.06 a2.as a2 E5 &sq
Mar 72 67 1) 9a 72.55 t3.82 14.80 16.7t 22.94 22.48 27.96 32.58 43.O5 51.43 49.90 62.49 66.45 74.O5 73.54 77.67 70.17 66.35
ADr 9.8S 10.07 77.64 15.53 20.54 )) \7 ,q 15 ?t 11 26.47 29.06 28.74 36.57 29.27 28.86 36.05 32.80 ,7 60 41 24 )1 \e 12.60
{s.62)(3.69)(1.54)18-s6l ls.44l 15.741 {8.231 111-581 172.771 l15.65l l1S-521 l13.ssl 119_151 12r.27)120.42\122.3A1 124.601 117.581 123.33)123-331
Jun 6-82 7.69 7.54 3.33 8.O7 4.94 0.85 (5.18)(7.391 (11.251 (16.131 (14.54)114.671 116.461 118.291 (19.831 (18.s9)(17.S01 (15.391 (15.791
hl 14.09 74.22 13.93 13 SO 15-74 19-31 19-61 1S-24 20.22 20.66 )o s7 )2 60 2l,_tE 21.73 20.64 17-99 77.42 18.88 14.60 16.72
A!e 74.77 15.40 15.23 75.77 74.76 19.88 25.27 23.89 25.U 29.35 31.29 33.61 33.7 L 36.75 34.58 39.95 44.99 46.58 45.44 49.57
Srp 13.45 13.34 16.32 15.56 75.26 19.52 7\.41 )2_O2 2g 7e )7 1e 11 7q 11 20 35 1A 3a 3S 34.47 ao.77 46.15 45-09 53.14 50.s4
od 12.67 a2.69 44.42 14.74 16.60 ,7.29 27.L7 20.76 22.52 23.99 26.54 27.44 3L.46 33.27 36.09 37.42 47.42 40.58 48.61 55.99
Nov 73.67 L4.97 13.15 13.95 1S Eq 22.13 21.72 23 qq 26 07 25 0A )9 70 30 ?7 1) 7A 34.3a 17.45 q5.o1 38.20 41.50 41.43 41.O2
Dcc 79.27 20_74 18.3S 20.77 22.7L 29.aL 29.97 17.29 33.81 34.24 31.25 39.68 40.73 43.03 44.77 43.74 49.43 53.46 51.82 59.87
1, New resources must sign contncts through the end of 2035. Existing resources must execute lo-year contracts. Resources not
RCW 80.80.40 compliant must execute s-year contracts. All new resource contrccts must begin delivery withln 3 years of execution;
renewal qF contract terms must betin st time of existing contract expiration.
2. HLH (heavy load-hours) are defined as 5:00 am until 10:00 pm rll d.ys. Ll.I (llght load-hours) are defined as all other hours.
3. qF may ceas. deliveries durinB periods whcre prices are negativc.
2021 Electric
lntegrated Resource PIan
Preferred Resource Strategy Update
l),,'Jigtsta
4t30120) 1
Safe Harbor Statement
This document contains forward-looking statements. Such statements are subject to a
variety of risks, uncertainties and other factors, most of which are beyond the Company's
control, and many of which could have a significant impact on the Company's operations,
results of operations and financial condition, and could cause actual results to differ
materially from those anticipated.
For a further discussion of these factors and other important factors, please refer to the
Company's reports filed with the Securities and Exchange Commission. The forward-
looking statements contained in this document speak only as of the date hereof. The
Company undertakes no obligation to update any forward-looking statement or
statements to reflect events or circumstances that occur after the date on which such
statement is made or to reflect the occunence of unanticipated events. New risks,
uncertainties and other factors emerge from time to time, and it is not possible for
management to predict all of such factors, nor can it assess the impact of each such factor
on the Company's business or the extent to which any such factor, or combination of
factors, may cause actual results to differ materially from those contained in any forward-
looking statement.
Preferred Resource Strategy
lntroduction
Avista issued a request for proposals (RFP) to acquire up to 120 aMW of clean energy in
the summer of 2020. The RFP was in response to the 2020lRP results indicating a clean
energy need. The need was driven by Washington's Clean Energy Transformation Act
(CETA), but also by the potential for some resources to be cost effective with federaltax
credits when compared to market alternatives. During the development of the 2021 lRP,
Avista used market intelligence gained from this RFP to inform new resource
assumptions; however, due to the time it took to negotiate the acquisition of the top
resour@ identified in the RFP and filing the IRP byApri! 1st, the2021lRP did not include
the RFP resource additions.
On March 24,2021, just prior to filing the 2021 Eleclric lRP, Avista signed a 10-year
contract with Chelan PUD for a 5 percent (slice) of its Rocky Reach and Rock lsland hydro
facilities. Energy deliveries will begin January 1, 2024 at a fixed price over the contract
term1. The new Chelan PUD hydro slice adds approximately 51 aMW under average
water conditions and 88 MW of nameplate capacity2. Avista estimates the contract wil!
decrease its system peak planning requirements by 53 MW serving both ldaho and
Washington jurisdictions. ldaho's share of the renewable attributes may meet
Washington's CETA law by transferring the renewable attributes to Washington in
exchange for a financial credit to ldaho customers.
The next several sections outline resource plan changes due to the acquisition of the
aforementioned Chelan slice. This document describes the impacts on resource
selection, cost and emissions relative to the 2021 IRP's Preferred Resource Strategy
(PRS). The RFP acquisition does not meet all of Avista's requirements for clean energy
and reliability resources over the next decade. At this time, both parties have an interest
in Avista acquiring an additional slice of capacity based on alternative proposals by
Chelan submitted in response to the RFP and Avista anticipates releasing another all-
source RFP in late 2021 to address any remaining resource shortfalls in order to comply
with the Purchase of Resources requirement in Washington State.
Summary of Analysis Changes
This IRP update explores the changes to the PRS from the acquisition of Chelan's 5
percent slice. Due to its impacts on system capacity and clean energy needs, an update
to the resource plan is necessary. Most of the assumptions, methodologies and results
remain the same as reported in the 2021 lRP. Avista used its PRISM modelto re-optimize
new resource selection after making changes to some assumptions. These changes are
described in Table 1. ln some cases, changes were required due to the timing of this
analysis, such as moving the timing of the first wind facility from 2023 to 2024. Other
1 Pricing and terms of the contract are confidential.
2 Avista currently has a 5 percent slice of the same Chelan PUD hydro facilities through 2031
1Avista Corp 2021 Electric IRP Update
Preferred Resource Strategy
changes, such as narrowing the window of the Kettle Falls modernization project, reflects
an update to Avista's actual decision window. Avista chose to maintain the 2021 IRP's
cost-effective energy efficiency savings forecast. The Company conducted a study re-
optimizing the efficiency forecast, but it only resulted in modest reductions so for simplicity
sake, it was left consistent with the original plan.
Table 1: Modeling Changes
The Preferred Resource Strategy
Avista's 10-year agreement to receive a 5 percent slice of Chelan PUD's Rocky Reach
and Rock Island projects changes the 2021 PRS by adding both clean energy and
capacity to the system. Ultimately, this RFP acquisition delays the need for new capacity
compared lo the 2021 !RP. The following section describes the resource plan and
identifies changes from the original 2021 IRP strategy. Since the energy efficiency
selection remains the same as the origina! plan, this update only includes changes to the
supply-side and demand response resources. The revised load and resource balance are
shown at the end of this document.
2022-2031 Su pply-Side Resou rce Selections
Avista must acquire new energy and capacity resources to meet clean energy goals and
fill capacity deficits. Table 2 shows the revised list of new generation selections and
exiting resources for the 2022 to 2031 period by jurisdiction. The system !abe! identifies
where the resource is split using the existing allocation factor of approximately 65 percent
Washington and 35 percent ldaho. Where a resource has a specific state listed, 100
percent of the resource benefits and costs are allocated to the identified customers. The
3 All other ldaho hydro shares are "transferrable" after 2030 as with the original PRS such as Palouse Wind,
Rattlesnake Flat, and Kettle Falls.
2
lnclude new energy, capacity and cost of the
new Chelan contract.
Required to reflect system changes.
Allow only new Chelan hydro slice to be
transferred from ldaho to Washington prior to
20303.
Aligns purpose of acquisition to use resource
for compliance with CETA requirements.
The energy efficiency estimates from the original
2021 IRP are not re-ootimized.
Re-optimizing energy efficiency will not
materiallv affect the olan.
Timing of first acquirable new wind generation
moved trom 11112023to 11112024.
Since a new wind resource was not selected
in the RFP, a new facility could not be
constructed in time to meet a potential
resource selected in 2023.
Narrow window of the Kettle Falls Generating
Station (KFGS) modernization between 20241o
2030.
This change reflects the timing necessary for
updating or replacing aging equipment.
Add up to a 5 MW market purchase allowance
prior to 2025.
lf Colstrip exits the portfolio prior to 2025,
Avista could have a de minimis resource
deficit in2023.
Assumption Changes Reasons for Changes
Avista Corp 2021 Electric IRP Update
Preferred Resource Strategy
first planned resource change is an economically driven exit of Colstrip from the portfolio
which reflects no change from the 2021 IRP's preferred resource plan. Refer to the 2021
IRP for more information on Colstrip. Avista's first new resource addition includes 100
MWof wind from Montana in2025, followed by another 100 MWof Montanawind in 2028
both for Washington customers. These resources contribute to meeting Washington's
clean energy goals along with providing some capacity benefit in meeting the system
winter peak. Ultimately, a future RFP willdetermine if these Montana wind resources are
the most economic alternatives for Avista's customers. Like the previous RFP, another
resource may better suit customer needs when a competitive list of proposed projects is
considered.
ln the 2020|RP, Avista found it cost effective to modernize the Post Falls hydro facility,
including increasing its capacity by 8 MW and energy output by 4 aMW. Avista included
this upgrade as an assumption in the plan, meaning its contribution to future load is an
input to the PR|SM model. Avista is currently developing plans for this facility and the final
energy and capacity specifications may change slightly.
Avista narrowed the decision window for modernizing Kettle Falls to between 2025 and
2030 to serve system loads. This IRP investigated the possibility of increasing plant
output by up to 12 MW during the modernization. This update identified the capacity
increase should occur by 2027.
\Mth the economically assumed exit of Colstrip and expiration of the Lancaster PPA in
October 2026, the resource plan update adds 168 MW of natura! gas-fired CTs compared
to 211 MW in lhe 2021 lRP. The resources are allocated to both ldaho and Washington
customers equally. As described before, actual acquisition is subject to the resources
available during an RFP or another competitive acquisition process.
Two new capacity resources are selected in 2031. The first is a 55 MW natural gas
reciprocating internal combustion engine (lCE) for ldaho customers. This resource
addition replaces lost capacity from Mid-Columbia hydro contracts and serves load
groMh. The other resource addition is a proposed renewal of some lost capacity from the
Mid-Columbia contracts. ln this case, the model found it most economic to allocate the
hydro acquisition to Washington and the reciprocating ICE to Idaho.
Over the next 10 years, this updated plan adds 518 MW of new generating capability,
although considering the losses of Colstrip and Lancaster, it only reflects a net increase
of 39 MW. From a winter peak perspective, Avista will have 136 MW less of winter peak
capability than it does today and 76 aMW less generation. Because the Company's
current resource mix has excess capacity, Avista is planning for less generating capability
than today.
3Avista Corp 2021 Electric IRP Update
Colstrip 3 & 44 System TBD -222 -222 -206
Montana wind WA 2025 100 33 45
Post Falls modernization Svstem 2026 I 4 4
Lancaster PPA Svstem 2026 -257 -283 -209
Kettle Falls modernization Svstem 2027 12 12 10
76Naturaloas CT WA 2027 u 93
Naturaloas CT ID 2027 u 96 76
Montana wind WA 2028 100 33 45
Natural qas reciprocatinq ICE ID 2031 55 il 50
Mid-Columbia Hvdro Extension WA 2031 75 44 33
Total New Resources 518 369 339
Net of Removed Resources 39 -136 -76
ISO
Conditions
(MW)
Equivalent
Winter
Peak
Capacity
Energy
Capability
(aMW)
Resource
M
Jurisdiction Year
Preferred Resource Strategy
Table 2:2021 Preferred Resource Strategy Update 12022-203U
2032-2041 Su pply-Side Resou rce Selections
The second decade of the PRS continues to replace existing resource capacity, meet
future load growth, maintain resource adequacy and add renewable energyto meet CETA
requirements. A complete list of resource additions for this decade is in Table 3. The first
resour@ addition for this decade is 100 MW of Montana wind for Washington. This is
followed by a 5 MWRathdrum CT upgrade in20% to serve capacity needs in both states.
Avista's Northeast GT is expected to retire by the end of 2035, if not earlier. Constructed
in 1978, Avista forecasts its retirement in 2035 due to its age and the difficulty of acquiring
parts to maintain the equipment. A new natural gas-fired CT will serve the lost capacity
and meet load growth for both Washington and ldaho customers. This addition is an 84
MW simple cycle CT using the existing allocation factors.
Avista's first planned solar acquisition occurs in 2038. Along with 50 MW of on-site lithium-
ion batteries with four hours of storage, the 100 MW solar project will serve both states'
needs. This addition corresponds with the expiration of our Adams-Neilson solar PPA. ln
2040, the 25 MW Boulder Park natural gas-fired reciprocating ICE facility and Raftlesnake
Flat PPA exit the portfolio. These resource losses are met with new Montana wind and
natural gas-fired reciprocating ICE machines. The Montana wind is allocated to
Washington customers and the naturalgas resource is allocated to ldaho customers.
a The 2021 IRP determined Colstrip is cost effective for Avista customers to exit in 2022, although due to
contractual complexities detailed in the 2021 lRP, Avista cannot at this time commit to a firm exit date.
4Avista Corp 2021E\*tric IRP Update
Preferred Resource Strategy
Over the second decade of the plan, the system has a net increase in 224 MW ot
generating capability with 475 MW of additional resources. Net winter peak and energy
capabilities increase by 121MW and 153 aMW respectively.
Table 3:2021 Preferred Resource Strategy Update 12032-20411
2042-2045 Supply Side Resource Selections
The IRP typically does not forecast resource additions beyond 20 years; however, given
CETA requirements to be 100 percent clean by 2045, Avista modeled 24 years into the
future for certain scenario analyses (see Chapter 12 of the 2021 IRP). The finalfouryears
of the plan, while relatively uncertain, includes replacement of renewable PPAs with both
solar energy and storage technologies, including lithium-ion and liquid air energy storage
(LAES). Table 4 outlines these additions. No major capacity resources are expected to
leave Avista's portfolio during this time period absent expiring PPAs.
5 Northeast CT has a 100-hour operating limit per year due to its air permit. Avista currently utilizes this
resource for operating reserves and contingency planning.
5
Montana wind WA 203/.100 28 45
Rathdrum uporade System 203/,5 5 4
Northeast CT5 Svstem 2035 -62 -43 0
Svstem 2036Naturalqas CT 84 93 76
Adams-Neilson Solar PPA WA 2037 -19.2 0 -5
Svstem 2038 100 2 26Solarw/ storaqe
4-hour storaqe flithium-ion)System 2038 50 7 -2
Rattlesnake Flat PPA Svstem 2040 -145 -7 -55
Svstem -14Boulder Park 2041 -25 -25
Montana wind WA 2041 100 26 45
ID 2041 36 35 33Natural qas reciprocating ICE
Total New Resources 475 196 227
224 121 153Net of Removed Resources
tso
Conditions
(MW)
Equivalent
Winter
Peak
Capacity
(MW)
Energy
Capability
(aMW)
Resource Jurisdiction Year
Avista Corp 2021 Electric I RP Update
Preferred Resource Strategy
Table 4:2021 Preferred Resource Strategy Update 12042-2045l.
Demand Response Selections
Demand Response (DR) resources are integral to Avista's strategy to meet customer
peak load requirements with non-emitting resources. Avista does not currently offer any
load management programs, although it has piloted DR programs6. To understand the
potential for new DR programs, Avista contracted with Applied Energy Group (AEG) to
estimate the amount of DR available in our ldaho and Washington service territories.
Chapter 6 - Demand Response of lhe 2021 IRP provides an overview of DR programs,
their expected costs and capacity potential. ln total, the maximum DR potential study
includes 16 programs to reduce as much as 169 MW of winter peak load and 245 MW of
summer peak load when ignoring costs. Some DR programs offer reductions in both
winter and summer, while others only in one season. Avista's primary needs are forwinter
peak reduction, and several programs were found cost effective. The 2021 PRS update
incorporates the first DR program in2025. Table 5 shows each DR program selected for
the PRS. Figure 1 illustrates when DR enters the system and how the penetration of DR
programs increase through 2045.
Meeting reliability targets with DR depends on the length of time each program can reduce
loads. Avista's ARAM model assumes 60 percent on-peak capacity credit for DR using
an 8-hour daily duration relative to a natural gas-fired CT. Actual experience and program
design will ultimately determine the actual amount of reliable capacity contribution from
these resources.
e Avista does not have any current plans to institute DR programs specifically for low-income energy
assistance and has not performed an assessment of low-income DR programs. lf the Company elects to
perform such an assessment, it would be coordinated through the Energy Assistance Advisory Group or
the Equity Advisory Group.
6
Palouse Wind PPA System 20/.2 -105 -5 -36
Solar w/ storaoe WA 20/.2 117 2 31
4-hour storaoe fl ithium-ion)WA 20/,2 58 I -2
Solar w/ storage WA 2043 122 2 31
4-hour storaoe (lithiumjon)WA 2043 61 I -2
Liouid Air Enerov Storaoe WA 12044137
Solarw/ storaqe WA 20/,5 149 3 40
4-hour storaoe flithium{on)WA 2045 75 11 -2
4-hour storase (lithium-ion)ID 2045 16 2 1
Total New Resources 611 45 94
Net of Removed Resources 506 40 58
tso
Conditions
(MW)
Equivalent
Winter
Peak
Capacity
Energy
Capability
(aMW)
Resource Jurisdiction Year
MW
Avista Corp 2021Elwtric IRP Update
Preferred Resource Strategy
Table 5: Preferred Resource Strategy Update- Demand Response Programs |.2022-20451
The same DR programs were selected as in the 2021 lRP, but the timing of the programs
changed. For example, the Time-of-Use rates program shifted in Washington from 2024
to 2031 and in ldaho lrom 20241o 2028 after the addition of the Chelan slice contract.
Table 6 outlines these changes to DR programs. \Mrile the programs selected do not
change, expected capacity savings change slightly due to the changes in program timing.
Overall DR capacity savings over the 24-year period are approximately 1 MW higher in
this update. Within Figure 1, the DR levels decrease in the later years of the forecast due
to customer fatigue. As indicated in AEG's potential study, the DR participation rates are
expected to decline after the programs reach full saturation.
Table 6: Timing Changes of Demand Response Programs (2022-20451
7
6.9 2025 5.6Variable Peak Pricins 2027
Larqe C&l Prooram 25 2027 0 nla
Time of Use Rates 2.4 2031 1.9 2028
DLC Smart Thermostats 7 2032 0 nla
Third Partv Contracts 14.3 2033 7.6 2038
0.9Behavioral 2039 0 nla
Tota!56.5 15.t
Program Washington
MW Year
ldaho
MW Year
Variable Peak Pricins 2024 2025 2024 2027
2027 2027 nla nlaLarqe C&l Proqram
Time'of-Use Rates 2024 2031 2024 2028
2031 2032 nla nlaDLC SmartThermostats
Third Partv Contracts 2032 2033 2024 2038
2041 2039 nla nlaBehaviora!
Washington
2021 IRP Update
ldaho
2021 IRP UpdateProgram
Avista Corp 2021Eledric IRP Update
Figure 1: Annual PRS Demand Response Capability (MW)
Preferred Resource Strategy
72 73 73 Z3 Z2 72
69
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PRS Comparison Analysis
The new Chelan slice contract creates a series of changes to the PRS. Table 7 illustrates
the supply-side changes in chronologica! order. Energy efficiency remains the same as
the2021lRP and DR programs are shown above. The table includes resource selections
by year, jurisdiction and megawatt capability. The 2021 IRP column shows the2021lRP's
PRS. The "Update" column includes the revised resource selection resulting from this
update. !n the case where a resource selection changed years, for example Kettle Falls,
it shows the originalyear ot2026 from the 2021 lRP and the revised year of 2027 resulting
from the update along with the changes in capacity in the "Change" column. !n total,
Washington additions are the same throughoutthe 24-year horizon although there are
changes to resource timing. ldaho capacity selections increase by 16 MW from changes
in the storage technologies pursued and from additional natural gas acquisition.
Washington does not see any changes in total natural gas generation acquisition, but
rather a change in the timing of those resources.
8Avista Corp 2021 Electric IRP Update
Preferred Resource Strategy
Table 7: Preferred Resource Strategy Changes (Capability in MW)
Revenue Requirement Changes
The total revenue requirement, including the addition of the Chelan hydro slice contract
and other portfolio changes, increases by 0.08 percentfrom the 2021lRP on a net present
value of revenue requirement (PVRR) basis. From a jurisdictional perspective, ldaho
costs decrease slightly (-0.02 percent) and Washington costs slightly increase (0.12
percent). The annual revenue requirement changes are shown in Figure 2. Change in
costs reflect the ac'tual cost of the 5 percent Chelan slice contract along with the other
changes described in this document. For example, not adding a 2023 wind resource
assumes the loss of the federal production tax credit (PTC) for later wind resources and
it does have a cost consequence to trade off the early savings of the Chelan contract to
offset higher non-PTC wind costs in2034.
I
Montana wind 2023 WA 100 0 -100
Montana wind 2024 WA 100 0 -100
2025 WA 0 100 100Montana wind
2026 -12Kettle Falls modernization System 12 0
Post Falls modernization 2026 Svstem I 8 0
Keftle Falls modernization 2027 Svstem 0 '|.2 12
NaturalGas Peaker 2027 ID 85 84 -1
2027 Svstem 126 0 -126NaturalGas Peaker
2027 WA 0 84 uNaturalGas Peaker
2028 WA 100 100 0Montana wind
NW Hvdro Slice 2031 WA 75 75 0
Natural oas reciorocatinq ICE 2031 ID 0 55 55
Montana wind 203/i WA 0 100 100
203/i Svstem 0 5 5Rathdrum CT Upsrade
2035 Svstem 5 0 -5Rathdrum CT Upsrade
-3NaturalGas Peaker 2036 Svstem 87 84
SolarW storaqe (4 hours)2038 Svstem 100 100 0
4-hr Storaoe for Solar 2038 Svstem 50 50 0
NaturalGas Peaker 2041 ID 36 36 0
2041 WA 100 100 0Montana wind
2042-2043 WA 239 239 0Solar M storase (4 hours)
4-hr Storaoe for Solar 2042-2043 WA 119 't 19 0
Liouid Air Storaoe 2044 WA 12 13 1
Liouid Air Storaoe 2045 ID 10 0 -10
4-hr Lithium-ion 2045 ID 0 16 16
2045 WA 149 149 0Solar w/ storase (4 hours)
2045 WA 75 75 04-hr Storaqe for Solar
Washinqton Tota!1,324 1,324 0
ldaho Total 264 280 16
Resource Year Jurisdiction 2021 IRP Update Chan
Avista Corp 2021 Electric IRP Update
Preferred Resource Strategy
Figure 2: Revenue Requirement Changes by State
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r rr r r,rJill.l.l.l.l,l,l l.l.l.l III IIII I
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Clean Energy Gomparative Analyses
Overall greenhouse gas emissions from the updated portfolio are 0.2 percent lower than
the 2021 IRP's PRS. This measurement includes only those emissions directly attributed
to Avista's resources, and assumes Colstrip leaves the portfolio. Figure 3 shows the
system-wide annual emissions forecast. Small emissions savings begin in the 2027
through 2030 period, but after 2030 these savings reverse due to the delayed addition of
natural gas peaking resources.
As mentioned before, the total amount of clean energy resources does not change
between the two plans, but rather the timing of those resources coming online. Avista
continues to plan for ramping into meeting 80 percent of its Washington retail sales with
clean energy beginning in 2022 to position the utility to comply with the 2030 CETA
requirement. This update relies on a larger procurement of ldaho's clean energy
resources. Figure 4 shows the amount of clean energy acquired from ldaho for
Washington and the new resource acquisitions each year between2022 and 2035. Avista
expects Washington customers to compensate ldaho customers for use of the clean
energy attributes of these resources to offset ldaho's opportunity cost of selling the clean
attributes to other parties.
The orange bars in Figure 4 show ldaho's clean energy transfers to Washington, where
the left side of the stacked bar chart is the updated resource strategy and the right side
shows the 2021 lRP. This chart shows REC transfers in 2023 through 2024, where the
2021 IRP did not include transfers. Between 2025 and 2033 the REC transfers are also
higher than the 2021 IRP reflecting the energy transferred from the Chelan hydro slice
Avista Corp 2021 Electric IRP Update 10
Preferred Resource Strategy
acquisition. The blue bars in the chart represent the new clean energy additions and
shows no new clean energy additions for the update until 2025. The chart ends in 2035
since the acquisition and transfers for both the updated and 2021 IRP's PRS are the
same.
Figure 3: System Greenhouse Gas Emissions
Figure 4: Washington Clean Energy Acquisltion
0
2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
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112021 Electic IRP UpdateAvista Corp
Preferred Resource Strategy
Load and Resource Balance
The new Chelan contract improves the system load and resource balance deficit
positions. Figure 5 includes the Chelan purchase in the blue bar, which increases Avista's
long position through October 2026 with current resources. This addition also narrows
resour@ deficits between 2027 and 2033.
Figure 5: Winter One-Hour Peak Capacity Load and Resource Balance
3,000
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Regarding summer peaks (Figure 6) and the annual average energy position (Figure 7),
the inclusion of the Chelan purchase also improves these metrics over the term of the
contract. The first short position on November 1, 2026 does not change but lessens the
need for new resource acquisition.
2,500
2,000
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1,000
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Avista Corp 2021 Electric IRP Update 12
Preferred Resource Strategy
Figure 6: Summer One-Hour Peak Capacity Load and Resource Balance
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Figure 7: AnnualAverage Energy Load and Resource Balance
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rResources rChelan Purchase
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Avista Corp 2021Electic IRP Update 13
Preferred Resource Strategy
New Resource Avoided Cost
Avista estimates the avoided costs of new resources for each lRP. This is a transparent
methodology to price new resources using resource cost and selection from the lRP. This
methodology is discussed in Chapter 11 of the 2021 lRP. Due to changes in the updated
portfolio's resource selection timing, the avoided costs change for both the clean energy
premium and the capacity value. The new prices are shown in Table 8. The most
significant change is the clean energy premium start date moves lrom 2023 to 2025 to
align with next new renewable resource addition. The capacity cost slightly increases in
2027 and beyond. These costs are derived from estimating the difference in cost of
portfolios with and without certain resources. For example, the clean energy premium
estimates the added cost of complying with Washington's CETA requirements. The
capacity value is estimated by comparing the cost of a portfolio with new capacity
resources versus a portfolio relying solely on the energy market.
Table 8: New Resource Avoided Costs
2022 $20.37 $21.66 $18.65 $0.00 $0.0
2023 $18.71 $19.34 $17.89 $0.00 $0.0
2024 $18.73 $19.04 $18.32 $0.00 $0.0
2025 $19.99 $20.05 $19.92 $16.90 $0.0
2026 $0.0$23.74 $23.68 $23.82 $17.24
2027 $24.63 $24.27 $25.12 $17.58 $118.3
2028 $25.67 $24.99 $26.58 $17.93 $120.6
2029 $26.65 $25.77 $27.83 $18.29 $123.0
2030 $26.46 $25.48 $27.78 $18.66 $125.5
2031 s27.63 $26.48 $29.15 $19.03 $128.0
2032 $28.02 $26.86 $29.57 $19.41 $130.6
2033 $29.30 $27.96 $31.08 $19.80 $133.2
203/.$29.42 $27.98 $31.33 $20.20 $135.8
2035 $30.47 $28.81 $32.68 $20.60 $138.6
2036 $32.10 $30.38 $34.41 $21.01 $141.3
2037 $31.95 $30.08 s34.45 s21.43 $1U.1
2038 $34.46 $32.26 $37.39 $21.86 $147,0
2039 $u.77 s32.31 s38.M $22.30 $150.0
2M0 $35.67 $33.15 $39.01 $22.74 $153.0
2041 $38.23 $35.77 $41.52 $23.20 $156.0
2042 $38.71 $36.40 $41.79 $23.66 $159.2
2043 $39.27 $36.92 $,42.40 $24.14 $162.3
204r'.$46.82 s44.18 s50.34 $24.62 $165.6
2045 $46.45 $44.31 $49.28 $25.11 $168.9
20 vr. Levelized $25.85 $25.20 s26.72 $14.61 $82.5
24vr. Levelized s27.18 $26.39 $r5.38$28.22 $88.9
Energy
Flat
(MWh)
Energy
On-Peak
(MWh)
Energy
Off-Peak
(MWh)
Clean
Premium
(MWh)
Capacity
($/kW-Yr)
Year
Avista Corp 2021 Electric IRP Update 14
2021 Electric
lntegrated Resource Plan
Washington Clean Energy Action PIan Update
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Safe Harbor Statement
This document contains forward-looking statements. Such statements are subject to a
variety of risks, uncertainties and other factors, most of which are beyond the Company's
contro!, and many of which could have a significant impact on the Company's operations,
results of operations and financial condition, and could cause actual results to differ
materially from those anticipated.
For a further discussion of these factors and other important factors, please refer to the
Company's reports filed with the Securities and Exchange Commission. The forward-
looking statements contained in this document speak only as of the date hereof. The
Company undertakes no obligation to update any forward-looking statement or
statements to reflect events or circumstances that occur after the date on which such
statement is made or to reflect the occurrence of unanticipated events. New risks,
uncertainties and other factors emerge from time to time, and it is not possible for
management to predict all of such factors, nor can it assess the impact of each such factor
on the Company's business or the extent to which any such factor, or combination of
factors, may cause actual results to differ materially from those contained in any forward-
looking statement.
Clean Energy Action Plan
Washington Glean Energy Action Plan
On May 7,2019, the Clean Energy Transformation Act (CETA) was signed into law committing
Washington to an electricity supply free of greenhouse gas emissions by 2045. Consequently,
each utility must incorporate the social cost of greenhouse gas emissions as a cost adder for
all relevant inputs when developing lRPs and Clean Energy Action Plans (CEAP). RCW
19.280.030 states that for an lnvestor-Owned Utility, the CEAP must (a) identify and be
informed by the utility's ten-year cost-effective conservation potential assessment; (b) if
applicable, establish a resource adequacy requirement; (c) identifo the potentia! cost-effective
demand response and load management programs that may be acquired; (d) identify
renewable resources, non-emitting electric generation and distributed energy resources that
may be acquired and evaluate how each identified resource may be expected to contribute to
meeting the utility's resource adequacy requirement; (e) identify any need to develop new, or
expand or upgrade existing bulk transmission and distribution facilities; and (f) identify the
nature and possible extent to which the utility may need to rely on alternative compliance
options, if appropriate.
Avista's updated 1O-year CEAP is a lowest reasonable cost plan of resource acquisition given
societal costs, clean energy and reliability requirements after incorporating the successful
completion of its 2020 renewable RFP. Avista developed this CEAP in conjunction with its
Technical Advisory Committee to meet the capacity, energy and clean energy needs of both
ldaho and Washington. The resources described in this CEAP are specific to the Washington
portion of Avista's system needs for compliance with CETA. The discussion of the plan below
describes the key considerations required by the WUTC. Details regarding the methodology
and assumptions for this plan are included in the 2021 IRP and the 2021 IRP Update. This
CEAP is the basis for the upcoming 2021 Clean Energy lmplementation Plan (CEIP).
Table 1 illustrates annual capacity additions of all planned resources, including demand
response and energy efficiency, for 2022 through 2031.
Energy Efficiency Savings
Avista plans to acquire 508 GWh of cumulative energy efficiency over the next 10 years based
on this IRP analysis. This represents 61.3 aMW when accounting for transmission and
distribution line loses over the 10-year period. These programs reduce winter peak loads by
64.3 MW and summer peak loads by 69.5 MW. lnformation on energy efficiency targets, and
detailed results, are available in IRP chapters 5 and 11, Energy Efficiency and the Preferred
Resource Strategy respectively. Figure 1 illustrates the energy efficiency selected for the 2021
PRS as well as the 1O-year pro rata share of both annual and cumulative efficiencyl. For more
information on the biennial conservation target and the EIA penalty threshold see Table 5.2 in
Chapter 5.
1 For 2022 and 2023, Avista's Biennial Conservation target is higher reflecting Distribution and Street Light
programs, decoupling adjustments and modifications for NEEA.
1Avista Corp 2021 IRP Update
Suoolv Resources (MWl
\Mnd 100.0 100.0
Kettle Falls GS uoorade 7.9
NaturalGas CT 84.0
NW Hydro Slice 75.0
Total Resources 100.0 7.9 84.0 100.0 75.0
Demand Resoonse (illlUl
Variable Peak Pricino 1.0 2.1 4.2 1.3 0.7 -0.1 -0.1
Time of Use Rates 0.3
Laroe C&l 25.0
Total Demand Resoonse 1.0 2-1 29.2 t.3 o.7 {.t o.2
EnersY Efficlencv
Enerov Savinos (GWh)z 33.5 39.6 43.9 52.1 58.3 62.9 65.5 64.0 61.2 56.1
\Mnter Peak Reduction 3.6 4.4 5.1 6.1 7.0 7.8 8.1 8.0 7.5 6.6
Summer Peak Reduction 4.5 5.3 5.9 7.O 7.5 8.3 8.1 8.18.1 6.8
Total MlllP 3.6 4.4 5.1 107.1 17.0 121.0 109.4 8.7 7A 8{.8
202sI 2026 2027 2028 2029 2030 20312022 2023 2024
Table 1: Washington Annual Capacity by Resource Type
Figure 1: Washington 10-year Energy Efficiency Target
Clean Energy Action Plan
508
457
600
500
r $sbctsd ff
-p1s
Rata 10 yr
z Includes estimated line losses.
3 Uses winter peak savings for energy efficiency.
406
355
305
I +oo
o
H 3ooi
TE
E')6 2oo
100
254
203
'152
102
2022 2023 2024 2025 2026 2027 2028 2029 2030 2031
51
2Avista Gorp 2021 IRP Update
Clean Energy Action Plan
Resource Adequacy
Avista must ensure its resources are adequate to serve its customers. Because of the benefits
of regional coordination, Avista is participating in the development of a regional resource
adequacy program. The Company's participation in regiona! resource adequacy efforts is
important because the choices of other utilities can affect the amount of resources that must be
constructed. Avista currently targets a 16 percent planning margin to meet winter peaks and a
7 percent planning margin for summer peaks. This is in addition to meeting operating reserves
and regulation requirements. Avista estimates participation in a regional resource adequacy
program may reduce its need for new capacity by up to 70 MW in 2031 based on the current
draft program design. These savings could allow the utility to require fewer new resources while
maintaining the same Ievel of reliability if the program is successfully implemented.
Avista's 2021 IRP calls for 84 MW of natural gas-fired capacity for Washington customers by
November 1, 2026 to replace the Lancaster PPA and meet reliability targets for Washington
customers during peak load hours. However, a total of 168 MW is needed for all Avista's
customers. \A/hib a future RFP may identiff a lower cost clean resource to meet this reliability
shortfal!, the current IRP modeling results selected a natural gas-fired resource in 2026 to
ensure reliable load service.
Demand Response and Load Management Programs
Avista does not have any demand response or Ioad management programs today, but this
CEAP identifies new programs with the potential to reduce peak load by 34.4 MW by 2031.
Load management programs are projected to begin in 2025 with variable peak pricing opt-in
programs. Savings are estimated to be 9.1 MW by 2031. A 25 MW large commercial customer
program option is selected before the Lancaster PPA ends in2026. Time-of-use rates become
cost effective in 2031, but only contribute 0.3 MW in its first year of program ramping. Future
all-source RFPs may find additional opportunities from demand response aggregators or other
sources.
Table 2: Demand Response and Load Management Programs
3
Variable Peak Pricino 9.1 2025
Laroe C&! Prooram 25.0 2027
Time of Use Rates 0.3 2031
Total 34.4
2031 SaviProram s (MW) Year
Avista Corp 2021 lRP Update
Clean Energy Action Plan
Planned Clean Energy Acquisitions
Avista developed CEAP targets to ensure 100 percent of Washington retail sales by 2030 are
served with clean energy options including up to 20 percent from offsets such as renewable
energy credits (RECs). Table 3 outlines the requirements and projected new resouroes to meet
the 2030 goal along with clean energy acquisition targets beginning in 2022. The 2021 IRP
identified a need for 132 aMW of clean energy by 20314 along with 59 aMW of clean energy
purchases from Avista's ldaho customers and 17 aMW of RECs from ldaho customers under
median hydro conditions in 2031. Depending on the WUTC's decision regarding compliance
with the 100 percent goal, Avista may need additional clean energy and/or RECs if renewable
and non-emitting energy must be delivered to customers simultaneously. Chapter 12 - Portfolio
Scenarios of the 2021 IRP outlines the cost and energy acquisition impacts of this scenario.
The new resources identified to meet CETA include 200 MW (96 aMW) of Montana wind, 5
aMW from Washington's share ol a 12 MW upgrade to the Kettle Falls Generating Station in
2026 and 31 aMW from renewing a 75 MW long-term hydro purchase power agreement in
2031. Avista's Washington customers may need to rely on the purchase of additional ldaho-
shares of hydro in years with low hydro or wind output.
Avista does not include transformational energy projects in this CEAP due to the uncertainty
regarding application to the clean energy requirements, although, Avista is actively pursuing
transportation electrification. The inclusion of these projects in the CEAP will be included in
future resource plans. Figure 2 summarizes the annual clean energy serving Washington
customers each year and by resource type in gigawatt-hours. The 10-year cumulative summary
of clean energy in gigawatt-hours is split by resource type in Figure 3.
Washington customers benefit from Avista's clean energy portfolio by optimizing or selling
RECs and specified energy sales to other markets. These sales benefit Washington customers
by $S to $8 million each year. Avista is considering creating a separate goal for the CEIP to
lower the targeted amount of "retired" or "not sold" clean energy to align with customer
affordability and to lessen customer rate impacts between 2022 and 2029. Avista plans to
discuss this target through its CEIP public participation outreach prior to finalizing specific goals
for the CEIP. This proposal does not change any planned clean energy acquisitions, but rather
the amount retired for compliance and/or purchased from ldaho customers in a given year
through 2029.
a The owned hydro energy forecast includes Washington customers' share of additional energy from an upgrade
to the Post Falls hydro facili$.
4Avista Corp 2021 IRP Update
Clean Energy Action Plan
Table 3:2022-2031 Washington Clean Energy Targets (aMW)
RetailSales 647 650 651 655 657 658 658 661 662 663
22 22 22 22 22 22 22 22 22PURPA 22
Solar Select 6 6 6 6 6 6 0 0 0 0
Net Reouirement 619 623 624 628 629 631 636 640 641 642
Taroet Clean Acouisition %80 80 85 85 90 90 95 95 100 100
496 49E 530 534 567 568 604 608Clean Energy Goal 641 642
292 288 288 285 292 289 292 289 291Owned Hydro 291
Contract Hvdros 96 95 oo 100 99 97 97 92 93 57
24 23 23 21 23 21 22 20 21Kettle Falls 19
24 24Palouse \Mnd 24 24 24 24 24 24 24 24
Rattlesnake Flat \Mnd 36 36 36 36 36 36 36 36 36 36
0 0 0Adams Neilson Solar 0 0 0 6 6 6 6
Available Resources 473 466 470 465 473 468 475 487 470 433
Resource Forecast
Montana \Mnd 0 0 0 48 48 48 96 96 96 96
0 0Kettle Falls Upqrade 0 0 0 6 6 6 5 5
Reoional Hvdro 0 0 0 0 0 0 0 0 0 31
23 33 60 21 47 39!D AVA Clean Purchase 45 28 60 59
lD AVA Hvdro Purchase 0 0 0 0 0 0 0 0 o 17
Total Enerov/RECs 23 33 60 69 93 100 129 141 170 208
Net Position 0 0 0 0 0 0 0 0 0 0
2022 2023 2024 2025 2026 2027 2028 2029 2030 2031
Need 23 33 60 69 93 100 129 141 170Total Clean Ene 208I
s lncludes the new Chelan contract.
5Avista Corp 2021 IRP Update
Clean Energy Action Plan
Transmission & Distribution lmprovements
Avista's resource acquisition plan does not include significant resource related transmission or
distribution improvements as acquired resources are likely to be off system or utilize existing
transmission assets with minimal new transmission investment. Avista plans future
transmission and distribution investments following its 10-year plan described in Appendix G.
This IRP resulted in two interconnection requests for Avista's Transmission department to
evaluate future resource opportunities. The first request is for up to 200 MW in the Rathdrum,
ldaho area and the second is to integrate the additionalcapacity at Kettle Falls. The Kettle Falls
interconnection request does not require any significant improvements at this time. Rathdrum
area resufts will not be available until late 2021 after the publication of this IRP in April.
Avista continues to upgrade its distribution system as customer load grows. Avista conducted
a review of potential resource acquisitions that could defer distribution investments, but none
were selected in this IRP based on economic analysis of the available alternatives. Avista plans
to develop a public process for distribution planning in 2021.
Energy Equity
Avista is currently developing a plan to ensure an equitable distribution of benefits and reduced
burdens on highly impacted communities and vulnerable populations through the IRP process.
Washington recently provided areas identified as Highly lmpacted Communities which willbe a
discussion topic of Avista's Equity Advisory Group (EAG). The EAG will guide the determination
of these communities as well as assist in designing the outreach and engagement that will be
used to distinguish and prioritize customer benefit indicators and solutions as wellas measuring
results. Avista recently committed to an energy efficiency program pilot focused on vulnerable
populations starting in 2021. Options on how to design and implement a program to meet this
commitment while identiffing barriers or missing data to ensure that these groups are receiving
their fair share of energy and non-energy benefits under CETA continue to be assessed.
This IRP includes analytica! enhancements to its energy efficiency cost effectiveness tests to
include non-energy impacts. These enhancements should benefit vulnerable communities.
Avista also includes provisions in its energy acquisition process to prioritize projects that may
improve resiliency and increase energy security in these communities. The priority evaluation
also includes preference to renewable projects located in vulnerable population areas to
develop these economies. This plan does not include new generation facilities in Washington6
except for an upgrade to the Kettle Falls wood-fired facilityT.
6 A future request for proposals of renewable energy may yield Washington based resources more beneficial
than those identified in this plan.
7 Due to its location near tribal lands, the Kettle Falls plant is in a state identified Highly lmpacted Community,
regardless of not meeting proposed criteria to be identified as a vulnerable populated area.
7Avista Corp 2021 IRP Update
Clean Energy Action Plan
Cost Analysis
The2021 IRP includes an analysis comparing the cost of the PRS to a baseline portfolio without
CETA's clean energy requirements. This analysis (Table 4 and Table 5) does not include the
recent acquisition of the Chelan PUD 5 percent hydro slice in the baseline. This modeling
exercise determines whether alternative compliance mechanisms such as the 2 percent cost
cap will be required. For the first two of the four-year compliance periods under CETA, Avista
expects to be under the cap by $Ag and $62 million, respectively, absent any future equity-
related program costs. The final two years of the 1O-year plan are not shown as they are part
of a four-year period extending beyond this CEAP timeline which are also expected to remain
under the cost cap. Avista will utilize the methodology used in this CEAP to develop a more
detailed cost cap analysis for the CEIP.
Table 4:2022-2025 Washington Cost Cap Analysis (millions $)
Table 5:2026-2029 Washington Cost Cap Analysis (millions $)
8
Revenue Requirement M SCC 651 651 659 68s 704
Baseline 650 657 672 678
Annual Delta 1 2 13 26 42
Percent Change 0.18o/o 0.29o/o 1.93o/o 3.83%1.60/o
FourYear Max Soendinq 33 33 33 33 132
Comparison vs Annualized Cost Cap (32)(31)(20)0l (89)
2021 2022 2023 2024 2025 Total
Revenue Requirement w/ SCC 704 712 718 744 755
Baseline 688 709 721 731
AnnualDelta 24 I 23 24 81
Percent Chanoe 3.51o/o 1.14o/o 3.22o/o 3.27o/o 2.8o/o
FourYear Max SpendinE 36 36 36 36 143
Comparison vs Annualized Cost Cap (1 1)(26)fi21 (2\Gzl
2025 2026 2027 2028 2029 Total
Avista Corp 2021 IRP Update