20071228final_order_no_30480.pdf

Office of the Secretary
Service Date
December 28, 2007
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF IDAHO POWER
COMPANY'S PETITION TO MODIFY THE
METHODOLOGY FOR DETERMINING
FUEL COSTS USED TO ESTABLISH
PUBLISHED RATES FOR PURP
QUALIFYING FACILITIES
ORDER NO. 30480
CASE NO. IPC-07-
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 a methodology for calculation of the
avoided cost rates paid to PURP A qualifying cogeneration and small power production facilities
(QFs) by Idaho Power Company, Avista Corporation and PacifiCorp. Avoided cost rates are the
purchase price paid to QFs for purchases of QF capacity and energy.
On September 10, 2007, Idaho Power Company (Idaho Power; Company) filed a
Petition with the Idaho Public Utilities Commission (Commission) to modify the methodology
for determining fuel costs used to establish published rates for PURP A QFs. Idaho Power
contends that use of the current method to set the fuel cost component in the surrogate avoided
resource (SAR) methodology will result in published avoided cost rates that are not
representative of the costs Idaho Power is likely to avoid by purchasing energy from QFs.
BACKGROUND
In Order No. 29124 issued September 26, 2002 in Case No. GNR-02-, the
Commission established the methodology currently used to compute the fuel cost component of
the surrogate avoided resource (SAR) methodology. See Attachment Order No. 29124 pp. 9-11.
For QF projects generating less than 10 aMW, the avoided cost rates determined by the SAR
methodology are commonly referred to as the published rates. The current SAR is a natural gas-
fired combined cycle combustion turbine.
The method the Commission adopted in Order No. 29124 to calculate the fuel cost
component starts with an arithmetic average of the nominal prices for natural gas for the first 3
years of the Northwest Power Planning and Conservation Council's (NWPCC) median 20-year
forecast of natural gas prices. These three years consist of the current year s forecasted price
ORDER NO. 30480
plus the previous two years ' forecasted prices , escalated a uniform percent per year over 20 years
(escalation rate also calculated from NWPCC forecast).
In 2004, the NWPCC revised the 20-year natural gas price forecast. In Order No.
29646, the Commission revised the fuel cost component for the SAR methodology utilizing the
average of the NWPCC's natural gas price forecast for the 3-year period 2004 through 2006.
This change in the three-year average price revised the fuel cost component in the SAR
methodology to $5.10. The fuel escalation rate was changed to 2.3%. As a result of these two
changes, in 2004, the levelized published rate for a QF project estimated to come on-line in 2007
(20-year term) went from 53.67 mills/kWh in 2002 to 62.40 mills/kWh in 2004.
IDAHO POWER PROPOSAL
On July 31 , 2007, the NWPCC released a draft of its next forecast of natural gas
prIces. Petition, Attachment 1.1 Idaho Power contends that there exists an extreme divergence
between NWPCC's forecast of natural gas prices and the assumed cost of fuel for the SAR. The
principal reason for the divergence between the assumed cost of fuel for the SAR under the
current methodology and the NWPCC's 20-year forecast in natural gas prices is the use of the 3-
year average starting point and the linear escalation from that starting point. By starting the fuel
cost assumption at the high end of the range of prices shown in the NWPCC forecast and
escalating prices from that point in a linear profile, the current methodology fails to recognize the
expected downward trend in fuel prices apparent in NWPCC's 20-year forecast. Failing to
recognize the non-linear shape of the NWPCC's 2007 forecast, the Company contends, will
cause the published rates to be much higher than they otherwise would be.
Idaho Power proposes that the Commission utilize the average of all 20 years of the
NWPCC's final 2007 median 20-year natural price forecast as the fuel cost component in the
SAR methodology. Because Idaho Power proposes to use the 20-year average price, no
escalation forecast is needed. (Utilizing assumptions in the NWPCC 2007 draft forecast, the
calculated escalation rate is 1.10%.
Petition Attachment 4 depicts three sets of published avoided cost rates for Idaho
Power: (1) the current published avoided cost rates; (2) the published avoided cost rates that will
go into effect if the NWPCC accepts its 2007 draft natural gas price forecast as its final forecast
1 The draft fuel price forecast was approved by the NWPCC on September 11 , 2007.
http://www.nwcouncil.orgilibrary/2007/2007-I4.htm.
See
ORDER NO. 30480
and the 3-year average natural gas price method remains unchanged; and (3) the Idaho Power
proposal - the fuel cost component is computed using the average of the 20 years of natural gas
prices from the NWPCC's draft 2007 median gas price forecast:
Using NWPCC Gas Forecast
Update Fuel Only Update Fuel Only
Published Rate Calculation Model Current Pricing Using Established Using a 20 yr Avg
Method
NWPCC 2004 Fuel NWPCC 2007 Fuel NWPCC 2007 Fuel
3 yr avg 3 yr avg 20 yr avg
2002-2004 2005-2007 2008-20027
20-yr levelized rate, on-line date:
2007 62.40 72.67.
2008 63.73.68.15
2009 65.31 74.68.
Idaho Power believes that its Petition presents a limited policy question to the
Commission. The Company does not believe that its proposal presents a factual dispute
requiring a technical proceeding to effectuate a resolution. The Company proposes to retain the
fundamental SAR methodology. The assumptions for all components of the SAR methodology
remain the same except for the fuel cost assumption. All of the data required to analyze Idaho
Power s proposal to change the fuel cost assumption are contained in the NWPCC's 2007 natural
gas price forecast in the current SAR methodology model. The Company is not requesting a stay
of the implementation of the new published rates while this case is pending.
Idaho Power requests that the Commission issue an Order changing the method for
determining the fuel cost component of the SAR methodology to utilize the average of all 20
years set out in the NWPCC's 2007 final median forecast of natural gas prices rather than the
escalated average of the first 3 years of the same forecast.
Initial Comments
On September 27, 2007, the Commission issued a Notice of Petition and Modified
Procedure in Case No. IPC-07-15 establishing a comment deadline of October 23 , 2007.
Comments were filed. by Idaho Windfarms LLC, Intermountain Wind LLC, Exergy
Development Group, Commission Staff, A vista Corporation, PacifiCorp dba Rocky Mountain
Power, INL Engineers, and other interested parties. All parties other than the utilities and Staff
oppose a change in the methodology.
ORDER NO. 30480
Staff (Avista and PacifiCorp)
Idaho Power proposes that the Commission utilize the average of all 20 years of the
Council's median 20-year forecast. The Commission Staff contends that a better, more straight-
forward and mathematically sound approach would be to use each year of the Council's entire
forecast "as is" rather than the escalated average of the first three years.See Schedule -
Deliberation Memo p. 7. A vista contends that the Company proposal does not account for the
time value of money." By using an average price across all of the year, Avista states, the
Company is proposing to pay a higher cost now and a lower cost later on, in real dollar terms.
Avista and PacifiCorp support Staffs proposed method.
Exergy
Exergy urges the Commission to deny the Company s Petition and to implement new
rates based on the existing SAR methodology. Exergy contends that the 17 inputs that comprise
the methodology are interdependent. The requested change in the variable fuel cost component
methodology, it states, reduces the published avoided cost from what it otherwise would be.
Exergy contends that some fixed components to the methodology have changed and should also
be adjusted (citing, e., construction costs and interest rates). In support of its opposition to a
change in only one component, Exergy contends that the Council's forecast has proven to be
extremely conservative.
Idaho Windfarms
Idaho Windfarms contends that there is an imbalance that occurs when the
uncertainty of wind is adjusted for integration costs and the fuel price uncertainty in utility
resources is ignored. Both, it states, have an equivalent impact on ratepayers. Clearly, it states
if we are to revisit one issue in calculating average costs, it is fair and reasonable to revisit them
all.
A vista
A vista opposes a revisiting of the non-fuel SAR assumptions. Natural gas, it notes
represents approximately 80% of the overall cost of the SAR resource. (Idaho Power in
supplemental reply comments estimates 70%.) Other cost drivers included in the SAR, on the
whole, it contends, remain reasonable, and were they to change would not greatly affect overall
published rates.
ORDER NO. 30480
Wind QFs
Idaho Windfarms, Intermountain Wind and Exergy all characterize the Company
proposal to change the fuel cost component methodology as a violation of the policy disfavoring
a single-issue rate case. Adjustment of only one item that makes up an overall rate, without
examining all components of the overall rate, Intermountain Wind contends, makes it impossible
for the Commission to make the statutorily required public interest finding that the overall rate is
fair, just and reasonable.Idaho Code 9 61-502. Intermountain Wind contends that avoided
cost rates under PURP A are subject to the same "fair, just and reasonable" standard as are retail
rates. Intermountain Wind and Idaho Windfarms contend further that the Company s proposal is
also an impermissible collateral attack on a final Order. Idaho Code 9 61-625.
Idaho Power Reply
Idaho Power in reply comments provides a brief summary of the legal underpinnings
and requirements of PURP A and distinguishes the standards the Commission is required by
federal law to follow in establishing avoided cost rates and the standards that Idaho law
establishes for setting retail rates. Federal law, it states, does not require the Commission to
consider whether the avoided cost rates it sets are sufficient to make QF projects economically
viable. If the Commission sets avoided cost rates that are equal to "the incremental cost to the
utility of alternative energy" the published rates, it concludes, are per se, just, reasonable and
non-discriminatory.18 C.R. 9 292.101(b)(6) definition "avoided costs ; 18 C.R. 9
292.304(a) Rates for Purchases.
Despite Exergy s urging, Idaho Power contends that federal law does not permit the
State of Idaho to artificially stimulate the development of QF resources by requiring the
Commission to set QF purchase prices above avoided costs. Connecticut Light Power Co.
FERC ~ 61 012 (1995).
Idaho Power states that the alternative methodology proposed by Staff, A vista and
Rocky Mountain is reasonable and is superior to the current methodology. The Company
believes, however, that the Staff and utilities ' proposal will cause greater swings in the cash
flows of QF developers and may thus impact project financing.
Addressing the suggestion that perhaps all SAR methodology cost components need
to be updated, Idaho Power states that it is agreeable to hosting a meeting no later than March 1
2008, to identify and quantify necessary updates to the remaining avoided cost methodology
ORDER NO. 30480
components. The Company is hopeful that an agreement can be reached and subsequently filed
with the Commission as a consensus document.
Supplemental Comments
Following its initial reVIew of filings, comments and recommendations, the
Commission established a further schedule and deadline for filing of additional written
comments or protests with respect to Idaho Power s Petition, the alternative proposal of Staff
A vista and PacifiCorp, and the use of Modified Procedure. The deadline for filing additional
comments was November 26, 2007 and December 5 for Company reply.
Additional comments were filed by the Renewable Northwest Project, Intermountain
Wind LLC, Exergy Development Group, Idaho Windfarms LLC, Rocky Mountain Power and
Commission Staff. Additional comments can be summarized as follows:
Exergy Development Group
In recommending that the Commission deny Idaho Power s Petition, Exergy
contends that the "proposed methodology has never been tested, litigated or examined in open
hearing.If both the existing methodology and the proposed methodology are reasonable
Exergy argues that the Commission is obligated to select the methodology that produces the
higher rate, a rate that will encourage QF development and put renewable projects at the top of
the list of new generation in Idaho.
Alternatively, Exergy recommends that the Commission adopt Staff's revised
methodology using the natural gas price forecast that Idaho Power uses in its general rate case
currently pending before the Commission (IPC-07-08). Exergy Additional Comments
Attachment C. As reflected in the schedule provided by Exergy, a comparison of Staffs
proposal (levelized - non-fueled projects) and Exergy s proposal results in the following:
Exergy Proposal
Staff Proposal Using All IPCo Gas Forecast
20 Years of NWPCC Forecast (IPC- E-07 -08)On-line Year IPCo A vista PacifiCorp IPCo
2007 66.67.67.74.
2008 67.14 67.67.74.
2009 67.68.67.75.
ORDER NO. 30480
Idaho Windfarms LLC (IWF)
IWF contends that this proceeding boils down to two key questions:
1. If the cost of uncertainty is to be deducted from prices for PURP A wind
projects, should it also be added to avoided costs?
As to this point, IWF cites A vista s IRP discussion of the impact of uncertainty on its
customers:
Historically, northwest utilities plan for variability inherent in theirhydroelectric plants and load forecast. Now, northwest utilities must
consider natural gas price volatility, thermal plant forced outages, wind
speed, extra-regional load and resource balances, and the ever changing face
of emissions legislation.
In most states, IWF contends the costs of uncertainty are simply ignored. While this approach is
not particularly scientific, it states, it is at least internally consistent.
2. Is it fair and reasonable to modify the current SAR methodology for only
one factor, i., fuel costs?
All avoided cost methodologies, IWF states, are a compromIse. How can one
element be adjusted, it queries, without a full and fair review of all elements?
Renewable Northwest Project (RNP)
Noting recent IRP filings by Avista and PacifiCorp and a Securities and Exchange
Commission (SEC) filing by Idaho Power RNP believes that the Commission s core
methodology for creating the published avoided cost rates using a combined cycle combustion
turbine (CCCT) as the surrogate avoided resource (SAR), continues to be fully appropriate. In
making any adjustment to the gas forecast methodology, however, RNP contends that the
Commission must determine whether the resultant published rate remains a reasonable estimate
of the cost of building and operating a CCCT facility. RNP contends that the rate fails that test
citing Idaho Power s IRP as a test of reasonableness.
On an interim basis, RNP recommends that the Commission continue using the
existing methodology. RNP suggests also that the Commission examine the published rate to
determine (a) whether the published rate methodology should use a fuel forecast that is updated
more regularly than the Council's forecast, (b) whether an averaging method such as that
proposed by (the Company J is appropriate, (c) whether capital costs or other factors in the
ORDER NO. 30480
published rate should also be updated, and (d) whether the published rate should include a value
for the absence of fuel price risk from renewable energy.
PacifiCorp
PacifiCorp in its additional comments contends that the advocacy of the methodology
proposed by Staff, A vista and PacifiCorp is evidenced by the fact that four of the states in which
PacifiCorp files avoided cost tariffs (Oregon, Washington, Utah, and Wyoming) utilize a year-
by-year gas forecast.
Intermountain Wind LLC
Intermountain Wind recommends that the Commission keep in mind the policy
objective - an objective it suggests is to restart PURP A implementation in Idaho , development
that it states has been stalled since September 2005 when the Commission reduced the published
rate eligibility threshold for non-firm QFs. (IPC-05-, Order No. 29872.It agrees with
Idaho Windfarms that continuous regulatory delays are killing the wind industry in Idaho.
Intermountain Wind contends that the proposed single element adjustment
unproven and untested and that the Commission, in considering the proposed single element
adjustment, must take into account the overall reasonableness of the resultant rate, a rate that it
believes is unreasonably low.
Intermountain Wind recommends that the Commission deny Idaho Power s Petition
and leave in place the current methodology until such time as all components of avoided cost
rates can be examined.
Commission Staff
Staffs interpretation of Order No. 29124 has always been that release of a new fuel
price forecast by the Council automatically triggers a re-computation of the published avoided
cost rates. Staff believes that the question as to whether the fuel price forecast computation
methodology should be changed is really one of "analytical accuracy," i., Staffs proposal
rather than continued use of what is a mathematical approximation of the Council's forecast.
The existing method, Staff contends, no longer works as originally intended and now fails badly
to replicate the new Council forecast.
Staff disputes Idaho Power s contention that "in the final analysis, a QF that
performs for the full 20-year term of its contract would receive the same compensation under
either Idaho Power s proposal or the proposal of Staff, Avista and Rocky Mountain." A 20-year
ORDER NO. 30480
levelized contract with a 2007 on-line date, Staff contends, would be paid $66.88/MWh under
Staffs proposed methodology and $67.77/MWh under the Company s proposed methodology.
Addressing the contentions of others that all variables need to be revisited, Staff
believes that generic variables should be changed only when they are likely to significantly
change the published avoided cost rates. Staff does not believe that to be the case now.
All of the variables, Staff notes, fall into three categories: (1) SAR generic variables;
(2) gas price variables; or (3) utility-specific cost of capital variables. The gas price variables are
being addressed in this case. Cost of capital related variables flow from and are the product of
utility-specific general rate cases. Many of the variables, Staff notes, are not interdependent, but
instead are simply calculated derivatives of other variables.
Stafflists the generic SAR variables along with their source as specified in Order No.
29124. Staff lists the current value of each variable and an assessment of the effect of increases
in capital costs on avoided cost rates. Staff Comments, Attachments A, Band F. Some values
have increased, some have decreased. Staff concludes that the resultant changes will not result
in higher avoided cost rates and do not merit a formal revisiting of the SAR methodology cost
components.
Additional Reply Comments (Idaho Power)
In its additional reply comments, Idaho Power points out that none of the wind
developers have asserted that the current 3-year average methodology accurately reflects the full
20-year profile of natural gas prices contained in the NWPCC's forecast. The wind developers
do not argue that continued use of the three-year average methodology is analytically accurate or
that it is consistent with the benchmark NWPCC gas price forecast. Nor are the wind
developers, the Company contends, urging retention of the three-year average methodology
because it is consistent with the NWPCC forecast of gas prices. Instead, the Company contends
wind developers want to retain the current three-year average methodology because it produces
higher purchase prices. Citing Intermountain Wind Additional Comments pp. 3-, Exergy
Additional Comments p. 6, and Idaho Windfarms Additional Comments p. 4.
Idaho Power argues that setting avoided costs using an analytically accurate
methodology protects both customers and QFs in the long run. Setting avoided costs in the
manner that places undue reliance on what it takes to make wind projects profitable and
ORDER NO. 30480
stimulate the PURP A wind industry, the Company argues, is inconsistent with both the letter and
spirit of PURP A.
Regarding Staff s argument that it is not necessary to convene a new proceeding to
look at the non-fuel-related avoided cost components, the Company states that while Staff may
be correct in its analysis, Idaho Power believes that the record relating to the costs of new
CCCTs should be more fully developed. To this end the Company recommits to facilitate
workshops to see if it might be possible to develop a consensus on updates to the non-fuel cost
related avoided cost components.
Commission Findings
The Commission has reviewed the filings of record in Case No. IPC-07-15 including
the Petition of Idaho Power, the alternate proposed change in calculation methodology of
Commission Staff and all related comments. We have also reviewed the NWPCC' s most recent
forecast of natural gas prices and our Order No. 29124 (Case No. GNR-02-1) that established
the methodology currently used to compute the fuel cost component of published avoided cost
rates. Based on our review of the filings of record the Commission continues to find it
reasonable to process this case pursuant to Modified Procedure, i., by written submission rather
than hearing. IDAP A 31.01.01.204. The Commission also finds that the release of a new fuel
price forecast by the Council automatically triggers a recalculation of the published avoided cost
rates under the methodology we approved in Order No. 29124 and carried out in Order No.
29646 when the Council released its 2004 fuel price forecast.
In Order No. 29124, Case No. GNR-02-, the Commission adopted the Council'
median natural gas price forecast as the source for the fuel prices used in the computation of the
published rates. The median forecast the Commission was considering at that time showed
natural gas prices steadily increasing over a 20-year forecast horizon. In our Order, we adopted a
three-year average calculation methodology (current year forecasted price, plus the previous two
years' prices , escalated a uniform percent over 20 years) which generally tracked the upward
profile of the Council's then-current median gas price forecast.
In contrast, the Council's most recent natural gas forecast shows a decidedly different
profile from the one we considered when we adopted the three-year average calculation and
escalated the result over a 20-year period. As a result, Idaho Power, Commission Staff
PacifiCorp, and Avista argue that the continued use of the three-year average calculation is no
ORDER NO. 30480
longer reasonable and a different calculation methodology for setting the fuel cost component of
avoided cost rates should be adopted by the Commission. We agree.
Continued use of the Commission s current three-year calculation methodology,
combined with out-year variations in the Council's most recent natural gas forecast, produces
values in the Commission s calculation that unreasonably vary from the Council's year-by-year
forecast. The Commission finds that the alternate methodology proposed by Staff (A vista and
PacifiCorp) for changing the fuel cost component accurately replicates the 20-year profile of
natural gas prices contained in the Council's forecast, i., use of each year of the Council'
entire forecast "as is" tracks exactly the magnitude and direction of the forecast's changes over
time. No party disputes this contention. We find it reasonable based on the written record
developed in this case to adopt Staffs proposed change for calculating the fuel cost component
in published avoided cost rates. We further find that the proposed change in the methodology to
calculate the fuel cost component in published avoided cost rates can be made independently
(and in advance) of a review of the entire list of non- fuel methodology variables.
The Commission agrees that a periodic review of the other methodology variables is
advisable, and accepts and encourages Idaho Power s offer to conduct a 2008 workshop to revisit
the other non-fuel methodology variables. We also deem it advisable that PacifiCorp and Avista
participate. We direct the Company to report its workshop findings to the Commission.
CONCLUSIONS OF LAW
The Idaho Public Utilities Commission has jurisdiction over A vista Corporation dba
Avista Utilities, Idaho Power Company, and PacifiCorp dba Rocky Mountain Power, electric
utilities, pursuant to the authority and power granted it under Title 61 of the Idaho Code, and the
Public Utility Regulatory Policies Act of 1978 (PURP A).
The Commission has authority under PURP A and 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.
ORDER
In consideration of the foregoing and as more particularly described above, IT IS
HEREBY ORDERED and the Commission does hereby approve Staffs proposed change in
methodology for calculating the fuel cost component of published avoided cost rates from the
ORDER NO. 30480
thr~e-year escalated average that we established in Order No. 29124 (Case No. GNR-02-1) to
. the use of each year of the NWPCC median 20-year natural gas price forecast. A schedule of
new rates accompanies this Order for an authorized effective date of January I , 2008.
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)
days after any person has petitioned for reconsideration, any other person may cross-petition for
reconsideration. See Idaho Code 961-626.
DONE by Order ofthe Idaho Public Utilities Commission at Boise, Idaho this
;).
c;t1-
day of December 2007.
MARSHA H. SMITH, COMMISSIONER
ATTEST:
6hu I'
.. D. Jewell
CMnmission Secretary
bls/O:IPC-07-15 sw
ORDER NO. 30480
AVISTA
AVOIDED COST RATES FOR FUELED PROJECTS
SMALLER THAN TEN MEGAWATTS
January 2008
$/MWh
ON-LINE YEAR
CONTRACT NON-LEVELIZED
2008 2009 2010 2011 2012 2013 YEAR RATES
15.15.16.16.41 16.17.2008 15.
15.15.16.16.16.17.2009 15.
15.16.16.16.17.17.2010 16.
15.16.16.16.17.17.2011 16.41
15.16.16.17.17.17.2012 16.
16.16.16.17.17.18.2013 17.
16.16.17.17.45 17.18.2014 17.
16.45 16.17.17.18.18.43 2015 17.
16.16.17.17.77 18.18.2016 18.
16.17.17.17.18.18.2017 18.
16.17.17.\8.18.49 18.2018 19.25
17.17.41 17.18.18.19.2019 19.
17.17.17.18.18.19.2020 20.
17.17.18.18.18.19.2021 20.
17.41 17.18.18.19.19.2022 21.
17.17.18.18.19.19.2023 21.
17.18.18.48 18.19.19.2024 22.
17.18.18.19.19.47 19.2025 22.
17.18.18.19.19.20.2026 23.
17.18.41 18.19.19.20.2027 23.
2028 24.
2029 24.
2030 25.
2031 25.
2032 26.
2033 27.
EFFECTIVE DATE ADJUSTABLE COMPONENT
1/1/2008 52.
The total avoided cost rate in each year is the sum of the adjustable component and the fixed component from either of the tables
above.
Example 1. A 20-year levelized contract with a 2008 on-line date would receive the following rates:
Years Rate
17.99 + 52.
17.99 + Adjustable component in each year
Example 2. A 4-year non-Ievelized contract with a 2008 on-line date would receive the following rales:
Years Rate
15.33 + 52.
15.68 + Adjustable component in year 2009
16.04 + Adjustable component in year 2010
16.41 + Adjustable component in year 2011
Note: The rates shown in this table have been computed using the Northwest Power and Conservation Council's September 11 , 2007
Fuel Price Forecast. (See Order No. 30480).
APPENDIX A (Avista)
CASE NO. IPC-E-07-
O~~ER NO. 30480
VISTA
AVOIDED COST RATES FOR NON-FUELED PROJECTS
SMALLER THAN TEN MEGAWATTS
January 1, 2008
$/MWh
ON-LINE YEAR
CONTRACT NON-LEVELIZED
2008 2009 2010 2011 2012 2013 YEAR RATES
67.65.62.59.59.59.2008 67.
66.45 63.61.59.59.43 59.2009 65.
65.62.60.59.59.60.49 2010 62.
64.61.60.46 59.60.61.2011 59.
63.61.60.60.60.62.2012 59.
62.61.60.60.61.45 62.2013 59.
62.61.42 60.61.62.63.2014 60.
62.45 61.61.41 61.62.64.2015 61.
62.61.61.62.63.65.2016 64.
62.62.42 62.63.64.45 66.2017 66.
63.62.63.63.65.66.2018 68.
63.49 63.63.64.49 65.67.2019 70.
63.63.64.65.66.68.2020 72.80
64.64.64.65.67.69.2021 74.
64.64.65.66.67.69.2022 77.
65.65.65.66.68.70.2023 79.40
65.65.66.67.69.71.2024 81.
66.66.67.68.69.71.2025 84.
66.49 66.67.68.70.72.32 2026 86.
66.67.68.69.70.72.2027 89.
2028 92.
2029 95.
2030 98.
2031 101.40
2032 104.
2033 107.
Note: The rates shown in this table have been computed using the Northwest Power and Conservation Council's September 11 , 2007
Fuel Price Forecast (See Order No. 30480).
APPENDIX A (Avista)
CASE NO. IPC-E-07-
ORDER NO. 30480
IDAHO POWER COMPANY
AVOIDED COST RATES FOR FUELED PROJECTS
SMALLER THAN TEN MEGAWATTS
January 1, 2008
$/MWh
LEVELIZED
ON-LINE YEAR
CONTRACT NON-LEVELIZED
2008 2009 2010 2011 2012 2013 YEAR RATES
14.14.14.15.15.15.2008 14.
14.40 14.15.15.43 15.16.2009 14.
14.14.15.15.15.16.2010 14.
14.15.15.40 15.16.16.2011 15.
14.15.21 15.15.16.16.2012 15.
15.15.15.16.16.46 16.2013 15.
15.15.15.16.25 16.17.2014 16.
15.15.16.16.40 16.17.2015 16.
15.46 15.16.16.16.17.2016 17.
15.15.16.16.17.17.2017 17.
15.16.16.48 16.17.17.2018 17.
15.16.16.17.17.40 17.2019 18.
16.16.16.17.17.17.2020 18.
16.16.16.17.17.18.2021 19.
16.28 16.17.17.44 17.18.2022 19.
16.40 16.17.17.17.18.40 2023 20.
16.16.17.17.18.18.2024 20.
16.17.17.43 17.18.18.2025 21.
16.17.17.17.18.18.2026 21.
16.17.17.18.18.18.2027 22.
2028 22.
2029 23.
2030 23.
2031 24.
2032 24.
2033 25.
EFFECTIVE DATE ADJUSTABLE COMPONENT
1/1/2008 52.
The total avoided cost rate in each year is the sum of the adjustable component and the fixed component from either of the tables
above.
Example 1. A 20-year levelized contract with a 2008 on-line date would receive the following rates:
Years Rate
16.89 + 52.
16.89 + Adjustable component in each year
Example 2. A 4-year non-Ievelized contract with a 2008 on-line date would receive the following rates:
Years Rate
14.24 + 52.
14.57 + Adjustable component in year 2009
14.91 + Adjustable component in year 2010
15.26 + Adjustable component in year 2011
Note: The rates shown in this table have been computed using the Northwest Power and Conservation Council's September 11 , 2007
Fuel Price Forecast. (See Order No. 30480).
APPENDIX 8 (Idaho Power)
CASE NO. IPC-E-07 -
ORDER NO. 30480
IDAHO POWER COMPANY
AVOIDED COST RATES FOR NON-FUELED PROJECTS
SMALLER THAN TEN MEGAWATTS
January 1, 2008
$/MWh
LEVELIZED
ON-LINE YEAR
CONTRACT NON-LEVELIZED
2008 2009 2010 2011 2012 2013 YEAR RATES
66.64.61.46 58.57.58.2008 66.
65.62.60.58.58.58.2009 64.
64.61.59.47 58.43 58.41 59.2010 61.46
62.60.59.28 58.58.60.2011 58.
62.60.59.58.59.60.2012 57.
61.60.59.59.60.61.2013 58.
61.60.59.60.61.62.2014 58.
61.60.45 60.24 60.61.63.41 2015 60.
61.60.60.61.62.64.23 2016 62.
61.61.61.62.63.65.2017 64.
61.61.62.62.64.65.2018 67.
62.62.62.63.45 64.66.2019 69.26
62.62.63.64.65.67.2020 71.41
63.63.63.64.66.68.2021 73.
63.63.64.45 65.47 66.68.2022 75.
64.64.41 65.66.67.69.2023 77.
64.64.65.66.68.70.2024 80.
65.65.66.67.45 69.71.2025 82.
65.66.66.68.69.71.2026 85.
66.66.67.47 68.70.42 72.40 2027 88.
2028 90.
2029 93.
2030 96.
2031 99.
2032 102.
2033 105.
Nole: The rates shown in this table have been computed using the Northwest Power and Conservation Council's September 11 , 2007
Fuel Price Forecast. (See Order No. 30480).
APPENDIX B (Idaho Power)
CASE NO. IPC-07-
ORDER NO. 30480
PACIFICORP
AVOIDED COST RATES FOR FUELED PROJECTS
SMALLER THAN TEN MEGAWATTS
January 2008
$/MWh
ON-LINE YEAR
CONTRACT NON-LEVELIZED
2008 2009 2010 2011 2012 2013 YEAR RATES
14.15.15.15.16.16.49 2008 14.
14.15.15.15.16.16.2009 15.
15.15.15.16.16.47 16.2010 15.
15.15.15.16.16.17.2011 15.
15.15.16.16.43 16.17.2012 16.
15.15.16.16.16.17.2013 16.49
15.16.16.16.17.17.2014 16.
15.16.16.16.17.17.2015 17.
15.16.16.17.17.48 17.2016 17.
16.16.47 16.17.17.18.2017 18.
16.16.16.17.17.18.2018 18.48
16.16.17.17.17.18.2019 18.
16.16.17.17.18.18.2020 19.
16.17.17.42 17.18.18.2021 19.
16.17.17.17.18.18.2022 20.
16.17.17.18.18.18.2023 20.
17.17.42 17.18.18.19.2024 21.
17.17.17.18.18.19.2025 21.
17.17.18.18.49 18.19.2026 22.
17.17.18.18.19.19.49 2027 22.
2028 23.
2029 23.
2030 24.
2031 24.
2032 25.49
2033 26.
EFFECTIVE DATE ADJUSTABLE COMPONENT
1/1/2008 52.
The total avoided cost rate in each year is the sum of the adjustable component and the fixed component from either of the tables
above.
Example 1. A 20-year levelized contract with a 2008 on-line date would receive the following rates:
Years Rate
17.38 + 52.
17.38 + Adjustable component in each year
Example 2. A 4-year non-Ievelized contract with a 2008 on-line date would receive the following rates:
Years Rate
14.71 + 52.
15.05 + Adjustable component in year 2009
15.39 + Adjustable component in year 2010
15.75 + Adjustable component in year 2011
Notes: (1) The rates shown in this table have been computed using the Northwest Power and Conservation Council's September 11
2007 Fuel Price Forecast. (See Order No. 30480). (2) The rates shown in Ihis table have been computed using the weighted average
cost of capital from PacifiCorp s most recent general rate case. (See Order No. 30482).
APPENDIX C (PacifiCorp)
CASE NO. IPC-E-07 -
ORDER NO. 30480
PACIFICORP
AVOIDED COST RATES FOR NON-FUELED PROJECTS
SMALLER THAN TEN MEGAWATTS
January 1, 2008
$/MWh
ON-LINE YEAR
CONTRACT NON-LEVELIZED
2008 2009 2010 2011 2012 2013 YEAR RATES
66.64.61.59.58.42 59.2008 66.
65.63.60.58.58.59.2009 64.
64.62.59.58.58.59.2010 61.
63.44 61.59.59.59.41 60.2011 59.
62.60.59.59.60.61.2012 58.42
62.60.59.59.60.62.2013 59.
61.60.60.60.61.63.2014 59.
61.60.60.61.62.63.2015 61.
61.61.61.61.63.64.2016 63.
62.61.61.62.63.65.2017 65.
62.44 62.62.48 63.64.66.2018 67.
62.62.63.63.65.67.2019 69.
63.63.63.64.66.67.2020 72.
63.63.64.65.66.68.2021 74.
64.64.64.65.67.42 69.2022 76.
64.64.65.49 66.68.69.2023 78.
65.65.66.67.68.70.2024 80.
65.65.66.67.69.46 71.2025 83.
66.66.47 67.68.46 70.72.2026 85.
66.67.67.69.70.72.2027 88.
2028 91.
2029 94.
2030 97.
2031 100.
2032 103.
2033 106.
Notes: (1) The rates shown in this table have been computed using the Northwest Power and Conservation Council's September 11
2007 Fuel Price Forecast. (See Order No. 30480). (2) The rates shown in this table have been computed using the weighted average
cost of capital from PacifiCorp s most recent general rate case. (See Order No. 30482).
APPENDIX C (PacifiCorp)
CASE NO. IPC-07-
ORDER NO. 30480