20100419Comment.pdf

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Jean Jewell
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Sent:
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annieb. boise(§gmail. com
Monday, April 19, 20106:15 AM
Jean Jewell; Beverly Barker; Gene Fadness
PUC Comment Form
A Comment from Annie Black follows:
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Case Number: IPC-E-08-24
Name: Annie Black
Address: 1110 Marshall St
City: Boise
State: ID
Zip: 83706
Daytime Telephone: [phone]
Contact E-Mail: annieb.boise~gmail.com
Name of Utility Company: Idaho Power
Add to Mailing List: yes
Please describe your comment briefly:
April 19, 2010
Dear Honorable Commissioners:
The Commission has been asked whether it wishes to accept the Idaho Power REC Management Plan
("Plan") submitted by Idaho Power Company ("Company") on December
30,2009 as part of Case No. IPC-E-08-24. I am writing to request that the Commission deny
the Plan as submitted, evaluate a handful of issues brought up by the Plan and request a
revised plan be submitted.
I would like to disclose some of my background and my association with interested parties in
this issue. In the early 1990s, I worked in the utility regulatory industry as a consultant
for a firm active in the California market. Years later, I was hired by the Company to run
programs using the Company's BPA Conservation and Renewable Discount dollars. I was a
Company employee from 2002 to 2007, at which time I left to be a full-time mother. That
remains my occupation. My primary role with the Company was in energy efficiency, but I also
worked on a variety of projects including the Company's Green Power Program.
Finally, I am a member of the Idaho Conservation League (ICL), an intervener in Case No.
IPC-E-08-24. It is important to note that the views expressed in this letter are solely my
own, not those of the Company nor ICL.
Some might argue that any comments relative to this Plan should have been brought prior to
the Commission's earlier rulings in Case No. IPC - E -08- 24. I would like to explain why this
is the first point at which I am engaging with the Commission on this issue.
I became aware of Case No. IPC-E-08-24 some time after the Commission issued its initial
ruling in Order No. 30720 in which the Commission approved the Company's request to retire
Green STags. I was pleased to hear this and, given my current pursuits at nome, did not take
the time to check back about any reconsideration filings. I heard after the fact about the
reconsideration proceedings and subsequent orders. At that time, the best course of action
seemed to be to ask about RECs as a policy issue in the 2009 Integrated Resource Planning
(IRP) process. At a 2009 IRP public hearing, I learned the Company had filed its REC Plan
and was awaiting acceptance by the Commission. That brings us to today.
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In evaluating the submitted Plan, the Commission is ruling on the nature of renewable energy
on Idaho Power's system for the foreseeable future. The Plan outlines four
components: (1) Existing Long-Term PPAs, (2) Existing PURPA and REC Generating Contracts,
(3) New Long-Term PPAs and (4 ) Qualified Renewable Proj ects. While the Company's plans
reflect the Commission's Order No. 30818 in Case No. IPC-E-08-24, I urge the Commission to
reevaluate some of the key issues associated with RECs prior to accepting the Plan.
From my perspective, there are four critical issues:
Is energy produced from a wind resource in any significant way different from energy
produced from coal or natural gas if its associated RECs are not retired?
What role should the State's Energy Plan and other State policies play in determining
the appropriate energy mix for Idaho Power?
Does the Commission believe that non-hydroelectric renewable energy on Idaho
Power's system is currently merely a hedge against a future federal or state Renewable
Portfolio Standard (RPS)or a resource with inherent benefits to the Company and its
customers?
Does selling RECs undermine the Company's Green Power Purchase Program and
leave it as the only option for purchasing non-hydroelectric renewable energy?
Certainly there are a number of subsequent issues such as the shelf life of tags, the
monetary value of tags to customers, the clarity of communication to customers regarding the
status of owned or sold RECs and more. Some of the critical issues I've mentioned above did
surface during deliberations of Case No. IPC-E-08-24 but were not answered to my
satisfaction. Furthermore, I am concerned that these critical issues are not understood by
many who are interested in Idaho's energy policy and resource mix but are not central players
in this case.
With regards to the critical issues, I offer up a few comments and welcome the opportunity to
discuss them further.
Wind vs. Coal or Natural Gas
Most people would argue three significant differences between wind and coal or natural gas as
an energy source - dispatchability and associated integration costs, fuel costs and
environmental impacts. RECs are not relevant to the first two but are at the crux of the
third. If the Commission finds no merit in the environmental impacts and thereby requires
the Company to sell its RECs, it implies that the environmental (or carbon) risks and costs
associated with coal or natural gas are not relevant.
Role of State's Energy Plan and Other State Policies The State issued an Energy Plan in 2007
and has subsequently set up the Idaho Office of Energy Resources. Both the Plan and the
Office have references to the role of renewable energy in Idaho's energy equation. I assume
that the Commission intends to regulate utili ties in a way that supports the State's energy
policies. In fact, the Commission did address this in Order No. 30720 where in its findings
it writes,
We further find that approving the present Application comports with several policies of the
Idaho Energy Plan. In particular, retiring Green Tags at this time promotes the development
of renewable resources, di versi fies Idaho Power's generation portfolio, and yet preserves the
Company's ability to meet changes in energy policy. State Energy Plan, Policies 1-2,5,10-11.
It is unclear how the State's policies were treated in the Petition for Reconsideration as
most of that petition was focused on the subsequent issues outlined above.
Renewable Energy: Hedge or Inherently Valuable Much of the deliberation in Case No. IPC-E-
08-24 was focused on whether the Company needed to retain rights to RECs in order to meet a
future federal or State RPS. While such speculation is important in business planning, it
ignores the question of whether the environmental and other benefits bundled in a REC have
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inherent value to the Company's customers or for that matter, the State as a whole. I
believe that acquiring RECs is important in light of uncertainty surrounding a federal RPS.
Furthermore, I would also argue that non-hydroelectric renewable energy does have inherent
value because of its environmental characteristics.
I find it troubling to hear parties in this case say that RECs are not necessary to claim
wind power on one's system as a renewable resource. While RECs are complex, may be seen as
"irrational" as stated in Staff Comments and are sometimes painted as a marketing gimmick,
they are readily accepted in the industry. In the past, arguments have been made that Idaho
does not have a REC market so they are somehow irrelevant here.
However, while some components of RECs are to be regulated by the states, Idaho is a player
in the national energy market and must abide by standards in that market. RECs are part of
the national standard regarding the treatment of non-hydroelectric renewable resources today.
With regards to customers, the Commission wrote in Order No. 30120 that "...by retiring the
Green Tags, Idaho Power retains the right to publicize and promote its renewable energy
resources in a way that informs customers and satisfies their expectations of the utility."
Nothing in the Reconsideration deliberations counteracts this point, which leads me to
believe that the Commission stands by this point.
Effects on the Green Power Program
By ordering the Company to sell its RECs, the Commission opens up questions about the premise
behind the Company's Green Power Program. In Case No. IPC-E-00-18, the Commission accepted
the Company's application, one based on buying and selling RECs as an appropriate mechanism
for delivering green energy (particularly wind and solar
energy) to customers. If RECs are not critical to the representation of what wind is as a
resource, then the basis on which the Green Power Program is built is flawed.
Furthermore, if the Commission adopts the Plan as stated, they will be endorsing the notion
that the Company's only mechanism for delivery non-hydroelectric renewable energy to its
customer is through the Green Power Program. As a customer and program participant, I find
this unsatisfactory. I am willing to pay more for additional renewable resources but not
willing to pay more if the company is not also required to offer some of these resources in
its overall generation mix. I am asking that the Company retire its RECs so that the
renewable energy that it has planned for in numerous IRPs will be delivered to me as a
customer prior to my putting my own money into the Green Power Program.
Past comments in the Company's IRP filings imply that Staff and the Commission accept and
perhaps endorse the Company's inclusion of wind energy in its portfolio mix.
In conclusion, I would encourage the Commission to further investigate these substantial
issues prior to accepting the Company's Plan as stated. I would welcome the opportunity to
offer up further documentation and information related to the above concerns. At a minimum,
I hope that the Commission can delay their decision until they are able to get complete
information on the sale of the 2007 and 2008 RECs. Whether the Company's RECs are
certifiable by Green-e and what value these RECs produced for customers seem to be important
pieces of data prior to deciding what the long-term disposition of the Company's RECs should
be.
Thank you for the opportunity to comment on this matter. Please let me know if you have any
questions.
Sincerely,
Annie Black
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