20211018Application.pdf

,iittsra
Avista Corp.
l4l I East Mission P.O.Box3727
Spokane, Washington 99220-0500
Telephone [phone]
Toll Free 800-727-9170
October 18,2021
Jan Noriyuki, Secretary
Idaho Public Utilities Commission
11331 W. Chinden Blvd. Bldg. 8, Ste. 201-A
Boise,Idaho 83714
RE: AVU-E-21-u.fAvista Utilities "My Clean Energy Program" Schedule 95 Proposed Changes
Dear Ms. Noriyuki,
Attached for filing with the Commission is an electronic copy of Avista Corporation's dba
Avista Utilities (Avista or the Company) proposed modifications to its Tariff Schedule 95, *My
Clean Energy Program." The proposed additions are included in the following tariffsheets, WN
U-28:
Fifth Revision Sheet 95
Third Revision Sheet 95A
Canceling
Canceling
Fourth Revision Sheet 95
Second Revision Sheet 95A
Please note that Appendix A and B include CONFIDENTIAL information and should be treated
as CONFIDENTIAL.
I: INTRODUCTION
The purpose of this filing is to modiff the My Clean Energy Program (Program) price
structure based on changing market conditions and to meet the legislative requirement of all costs
and benefits being confined to the program, while optimizing value for program participants.
Since implementing national and regional program options, approved by the Commission
on March 2,2020,r as well as a 100% renewable option approved by the Commission on March
I Order No. 34566 irCase No. AVU-E-19-12.
16,2021,2 the Company has made meaningful progress towards improving performance across all
program Key Performance Indicators (KPIs):
o Customer Satisfaction and Loyalty: Net Promoter Score (l.PS) has improved
from a +3 year one baseline (2019) to a +31 year three results (2021).
My Cleon Energy NPS Scores
50
&
30
n
l0
0
20l9 2021
Customer Awareness: Measured based on web page views. All customer
commtmications and messaging direct customers to the Program page of Avista's
website. External web taffic continues to grow as shown in the chart below.
nn
INPS IGod
a
1.712
Web Poge Views
850 913 rcl 191JJililI I I
5,0m
4,0m
3.m
2.000
l,0m
0
336 373
Il .I
796il I
Jon Feb Mor Apr Moy Jun Jul Aug Sep Oct Nov Dec
.nn .n2l
Customer Acquisition: The program has reversed the trend on customer loss and
is seeing growth for the first time in three years and currently includes 4,067
customers across Washington and Idaho.
o
2 Order No. 34963 in Case No. AVLI-E-20-14.
Page2
Porticipont Count (ovg)
6.m
5,0m
4,0m
3,0m
20m
l,m
0
50001.190 3,716 3.6s6
?ot7 2018
Icustomer counl
4,067
3,25
20t 6
3,176
I
nn YID2019
-gool
II: PROPOSED PROGRAM CHAI\IGES
While there is positive momexrtum with the Program as indicated above, there has been a
recent dramatic increase in the price of renewable energy credits (RECs) that are purchased on
behalf of the program. During 2019 Avista evaluated the Company's Program by conducting
customer research, amlyztng program costs and customer participation levels, and reviewing
comparable programs of other investor owned utilities.
Since that time, REC prices in the market have increased substantially, well beyond
anything Avista could have anticipated based on historic and recent conditions. Over the course of
the 2021 calendar year, Avista has seen the market price for RECs rise significantly. Industry
reports, included as Confidential Appendix A and B, show a nearly 10x price increase for the price
of TX Green-e Wind which has risen since 2019. Similarly, regional RECs for the Western
Interconnection (WECC) have risen more than 5x and Washington compliant Green-e RECs have
more than doubled. It is uncertain whether these prices will remain inflated or decline closer to
historical prices, but it is clear that the pricing that is currently in place for the Program is creating
significant revenue loss and is not sustainable.
Entering into 2021, the program had a surplus of $97,000. This is partially due to the timing
and reconciliation of REC purchases and account balances. Avista energy marketers have been
assessing the market all year to purchase RECs within the approved margin of the Program, but
have not been able to support the needs of the Program. Currently, the Program forecasts a
$267,000 surplus at year end before purchasing an estimated 70,000 RECs needed to fuIfiII2021
Page 3
customer purchases. Avista recently authorized the purchase of 30,000 RECs at $4.95 to partially
meet this need which will cost a total of $175,000 and bring the surplus down to $92,000 with
another 40,000 RECs yet to be purchased.
The current tariff includes three purchase options: 1) a national block option where
customers can purchase 300 kwh for $l a month with RECs sourced from anywhere through the
United States; 2) a regional option where customers can purchase 100 kwh for $1 a month for
RECs procured within the WECC, with preference given to the Northwest region including WA,
ID, O& CA, MT and BC;3 and 3) al00%o clean option that is charged per kWh rather than block
purchases and is priced at $0.01/ per kWh. In this option, the amount of kWhs purchased will vary
each month to match the customers actual kWh usage.
ln order to prevent further loss of revenue within the Program, the Company is proposing
the following revisions to the pricing structure.
National Blocks - Participants can purchase 100 kWh "blocks" for $1.00. RECs procured
under this option will be sourced from renewable generation anywhere in the United States.
This provides customers a low-cost option to continue supporting renewable energy.
Reeional Blocks - Participants can purchase 100 kWh "blocks" for $1.30. RECs procured
under this option will be sourced from generation located in the WECC, with preference
given to the Northwest region including WA, [D, OR, CA, MT and BC. This option
provides customers an opportunity to support regional renewable energy at a price point
that is more reflective of the current REC market.
100% Renewable Option - One (l) kWh of renewable power from a Regional source
located in the WECC, with preference given to the nor0rwest region including WA, ID,
OR" CA, MT, and BC will offset every kWh used at the customer selected meter. Each
kWh is priced at $0.013 / per kWh and the amount of kWhs purchased will vary each
month to match the customers actual kWh usage.
This pricing was informed using an analysis of the current and forecasted program budgets
and with the expectation that the202l market price for RECs will likely continue into the next
calendar year or more. The goals in determining the appropriate pricing for the Program is to
ensure that all costs are covered by expected reve,nues, setting pricing at a point that still attacts
3OrderNo.34566inCase No.AVU-E-I9-l2,allowedtotake effectbyoperationoflawonMarch2,2020.
Page 4
participants while tolerating REC market price volatility, and that may lead to a budget surplus
that may be used to fund non-profit community solar installations. The forecasted budget analysis
based on the pricing described above can be found in Appendix C.
III: CUSTOMERS COMMUNICATION
Avista will provide notice of the proposed tariffchanges to Program participants through
email and direct mail communications. The notice will include a statement of the proposed
changes, the proposed implementation timeline, why the pricing is being modified and how
customers can contact the Commission in regard to this filing. Customers will also be reminded of
how they can change or cancel their subscriptions.
IV: CONCLUSION
While the cost for national and regional RECs are relatively similar today, the Company
sees continued value in a slightly lower price point for national RECs, where there is a broader
market to purchase such RECs, and there is more inherent value in the regional RECs. Avista will
continue to offer solar grants if and when the budget surplus allows, and if it does earn a slightly
higher margin on the regional options, the solar grants will fund local projects.
The Company requests the tariff changes be allowed to take effect on January 1,2022.
Please direct any questions regarding this filing to Amanda Ghering at [phone] or
amanda.shering(@avistacorp.com or me at [phone] or shawn.bonfield(davistacorp.com.
Sincerely,
lolslarrr* gd&u
Shawn Bonfield
Sr. Manager, Regulatory Policy & Strategy
Page 5
|.P.U.C. No.28
Fifth Revision Sheet 95
Canceling
Fourth Revision Sheet 95
AVISTA CORPORATION
d/b/a Avista Utilities
SCHEDULE 95
MY CLEAN ENERGY PROGRAM - IDAHO
AVAILABLE
To Customers in the State of ldaho where the Company has electric service. Customers may
participate in one or more available Renewable Energy Credit (REC) program options.
APPLICABLE
To all customers receiving electric service who agree to purchase blocks of renewable power
under this schedule.
PROGRAM OPTIONS AND CHARGES:
Clean Energy program options available to customers will utilize the types of qualifying
resources including wind, solar and biomass, but may also come from other renewable
resources. Program option available to ldaho customers will include, but are not limited to the
following:
National Block Option - One (1) block is equal to 100 kWh of renewable power from a
National sour@ located anywhere in the United States. Each block is priced at $1.00 per
block, per month.
Reoional Block Ootion - One (1) block is equal to 100 kWh of renewable power from a
Regional souroe located in the Western lnterconnection (WECC), with preference given
to the northwest region including WA, lD, OR, CA, MT, and BC. Each block is priced at
$1.30 per block, per month.
100% Renewable Ootion - One (1) kWh of renewable power from a Regional source
located in the Western lnterconnection (WECC), with preference given to the northwest
region including WA, lD, OR, CA, MT, and BC will ofbet every kWh used at customer
selected meter. Each kWh is priced at $0.013/ per kWh and the amount of kWhs
purchased willvary each month to match the customers actual kWh usage.
All program charges shall be in addition to all other charges contained in the custome/s
applicable tariff schedule.
MONTHLY BILLING
National and Regional block options - The monthly billing shall be the number of Blocks the
customer has agreed to purchase multiplied by the Charge per Block. The Monthly Billing is in
addition to all other charges contained in customer's applicable tariff schedule. This schedule's
Monthly Billing shall be applied to the custome/s billing regardless of actual energy
consumption.
lssued October 18,2021 Effective January01,2022
lssued by Avista CorporationBy Patrick Ehrbar, Director of Regulatory Affairs
l.P.U.C. No.28
Third Revision Sheet 95A
Canceling
Second Revision Sheet 95A
lssued by Avista CorporationBy Patrick Ehrbar, Director of Regulatory Affairs
AVISTA CORPORATION
d/b/a Avista Utilities
SCHEDULE 95 - Continued
100o/o Renewable Option - The monthly billing shall be based on the customer's actual electric
usage at the meter selected by the customer. For every kWh of electricity used, the customer
will be charged $0.013/kwh premium for renewable power. The Monthly Billing is in addition to
all other charges contained in the customer's applicable tariff schedule.
RENEWABLE POWER
For the purpose of this schedule, the renewable power sourced through renewable energy
certificates (RECs) shall be recognized via the Western Renewable Energy Generation
lnformation System (WREGIS) tracking system or another REC tracking system of record with
preference toward Green-e certified and primarily from these sources: Wind and solar power, but
may also come from other renewable resources.
PROGRAM ADMINISTRATION:
To ensure that all costs and benefits of this program are only applied to program participants, all
funds collected and spent under this Schedule will be separately identified and tracked. Funds
received from Customers under this Schedule will be used to cover program costs (e.9.: program
management, accounting, communications, etc.) as well as to match block subscriptions to REC
purchases.
RENEWABLE EN ERGY PROJECTS/GRANTS:
ln an effort to promote and build awareness of renewable energy generation options, if available,
funds collected, but not otherwise required to meet program obligations may be distributed for
one or more of the following renewable projects:
1. Funding for locally-owned, non-residential solar projects. Applicable customers, witha preference for community-based projects that provide for educational and
environmental benefit to local communities, or otherwise receive service under this
Schedule, may apply for a grant to cover all or a portion of the cost of installation.2. Funding for research and development projects that encourage Renewable Energy
market transformation in order to accelerate marketability of Renewable Energy
technologies.3. Funding for above-market costs associated with the new construction of Renewable
Energy facilities or the purchase by contract of Renewable Energy that reduces the
costs of Renewable Energy to be competitive with cost-effective resour@s.
Eligible renewable energy projects would not be considered for purposes of any Renewable
Portfolio Standard requirements. Renewable energy that is generated in response to any federal
or state statutory requirement to construct or contact for the renewable energy is not eligible for
the funding under this Schedule.
To the extent an eligible project in Section 1,2, and 3 above is able to generate RECs, the grant
recipient agrees that the Company, on behalf of the Schedule g5 program, has the first right to
claim a share of the project's REC output. The amount of these RECs is expressed as a
percentage of output when comparing the Schedule 95 financial contribution to the overall cost
of the project. The proportional amount of these RECs will be retired on behalf of the program.
lssued October 18,2021 Effective January01,2022
l.P.U.C. No.28
lssued by
By
Sheet 958
AVISTA CORPORATION
d/b/a Avista Utilities
SCHEDULE 95 - Continued
SPECIAL TERMS AND CONDITIONS
1. Service under this schedule is subject to the Rules and Regulations contained in this
tariff.2. Customers may apply for or terminate from this schedule anytime during the year. The
Company may limit availability of this program subject to available renewable power at
the cost incuned under the terms described above.
3. The above Monthly Billing is subject to increases as set forth in Tax Adjustment
Schedule 58.
Effective March 16,2021lssued March 17,2021
Avista Corporation
Patrick Ehrbar, Director of Regulatory Affairs
LP.U.C. No.28
eeun*Effin Revision Sheet 95
Canceling
+hir+Egllth_Revision Sheet 95
by
By
AVISTA CORPORATION
d/b/a Avista Utilities
SCHEDULE 95
MY CLEAN ENERGY PROGRAM - IDAHO
AVAILABLE
To Customers in the State of ldaho where the Company has electric service. Customers may
participate in one or more available Renewable Energy Credit (REC) program options.
APPLICABLE
To all customers receiving electric service who agree to purchase blocks of renewable power
under this schedule.
PROGRAM OPTIONS AND CHARGES:
Clean Energy program options available to customers will utilize the types of qualifying
resourc€s including wind, solar and biomass, but may also come from other renewable
resourc€s. Program option available to ldaho customers will include, but are not limited to the
following:
National Block Ootion - One (1) block is equal to f300 kWh of renewable power from a
National sour@ located anywhere in the United States. Each block is priced at $1.00 per
block, per month.
Reoional Block Ootion - One (1) block is equal to 100 kwh of renewable power from a
Regional souroe located in the Western Interconnection (WECC), with preference given
to the northwest region including WA, lD, OR, CA, MT, and BC. Each block is priced at
$1.390 per block, per month.
100% Renewable Ootion - One (1) kWh of renewable power from a Regional source
Iocated in the Western lnterconnection (WECC), with preference given to the northwest
region including WA, lD, OR, CA, MT, and BC will offset every kWh used at customer
selected meter. Each kWh is priced at $9.013/ per kWh and the amount of kWhs
purchased willvary each month to match the customers actual kWh usage.
All program charges shall be in addition to all other charges contained in the custome/s
applicable tariff schedule.
MONTHLY BILLING
National and Regional block options - The monthly billing shall be the number of Blocks the
customer has agreed to purchase multiplied by the Charge per Block. The Monthly Billing is in
addition to all other charges contained in customer's applicable tariff schedule. This schedule's
Monthly Billing shall be applied to the custome/s billing regardless of actual energy
consumption.
lssued OctoberMarehlgl,2O2l Effective JanuarvMareh 816, 2022+
Avista
Patrick Ehrbar, Director of Regulatory Affairs
LP.U.C. No.28
Seeend-Third Revision Sheet 95A
Canceling
Sheet 95A
by
By
AVISTA CORPORATION
d/b/a Avista Utilities
SCHEDULE 95 - Continued
100% Renewable Option - The monthly billing shall be based on the custome/s actual electric
usage at the meter selected by the customer. For every kWh of electricity used, the customer
will be charged $9.013/kwh premium for renewable power. The Monthly Billing is in addition to
all other charges contained in the custome/s applicable tariff schedule.
RENEWABLE POWER
For the purpose of this schedule, the renewable power sourced through renewable energy
certificates (RECs) shall be recognized via the Western Renewable Energy Generation
lnformation System (WREGIS) tracking system or another REC tracking system of record with
preference toward Green-e certified and primarily from these sources: Wind and solar power, but
may also come from other renewable resources.
PROGRAM ADMINISTRATION:
To ensure that all costs and benefits of this program are only applied to program participants, all
funds collected and spent under this Schedule will be separately identified and tracked. Funds
received from Customers under this Schedule will be used to cover program costs (e.9.: program
management, accounting, communications, etc.) aswell as to match block subscriptions to REC
purchases.
RENEWABLE ENERGY PROJECTS/GRANTS:
!n an effort to promote and build awareness of renewable energy generation options, lf availabb,
funds collected, but not otherwise required to meet program obligations may be distributed for
one or more of the following renewable projects:
1. Funding for locally-owned, non-residential solar projects. Applicable customers, witha preference for community-based projects that provide for educational and
environmental benefit to local communities, or otherwise receive service under this
Schedule, may apply for a grant to cover all or a portion of the cost of installation.2. Funding for research and development projects that encourage Renewable Energy
market transformation in order to accelerate marketability of Renewable Energy
technologies.3. Funding for above-market costs associated with the new construction of Renewable
Energy facilities or the purchase by contract of Renewable Energy that reduces the
costs of Renewable Energy to be competitive with cost-effective resour@s.
Eligible renewable energy projects would not be considered for purposes of any Renewable
Portfolio Standard requirements. Renewable energy that is generated in response to any federal
or state statutory requirement to construct or contact for the renewable energy is not eligible for
the funding under this Schedule.
To the extent an eligible project in Section '1,2, and 3 above is able to generate RECs, the grant
recipient agrees that the Company, on behalf of the Schedule 95 program, has the first right to
claim a share of the project's REC output. The amount of these RECs is expressed as a
percentage of output when comparing the Schedule 95 financial contribution to the overall cost
of the project. The proportional amount of these RECs will be retired on behalf of the program.
lssued OctoberMareh17g,2021 Effective *qar€h-Je!8ry.fq16, 2024
Patrick Ehrbar, Director of Regulatory Affairs
|.P.U.C. No.28
lssued by
By
Sheet 958
AVISTA CORPORATION
d/b/a Avista Utilities
SCHEDULE 95 - Continued
SPECIAL TERMS AND CONDITIONS
1. Service under this schedule is subject to the Rules and Regulations contained in this
tariff.2. Customers may apply for or terminate from this schedule anytime during the year. The
Company may limit availability of this program subject to available renewable power at
the cost incurred under the terms described above.
3. The above Monthly Billing is subject to increases as set forth in Tax Adjustment
Schedule 58.
lssued March 17,2021 Effective March 16,2021
Avista Corporation
Patrick Ehrbar, Director of Regulatory Affairs
AVISTA UTILITIES
Tariff Schedule 95
My Clean Energy
Appendix A - 2019 Karbone Report
REDACTEI)
October 18,2021
AVISTA UTILITIES
Tariff Schedule 95
My Clean Energy
Appendix B - 2021 Karbone Report
REDACTED
October 18,2021