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Idaho Public Utilities Commission
Case No. IPC-E-08-24, Order No. 30743, Order No. 30018
May 21, 2009
Contact: Gene Fadness (208) 334-0339, 890-2712
Commission orders utility to sell Green Tags
The Idaho Public Utilities Commission, reversing an earlier decision, has ordered Idaho Power Co. to sell its 2007 and 2008 Green Tags and use the proceeds – estimated to be between $1.6 million and $1.9 million – to benefit ratepayers.
A Green Tag, or Renewable Energy Credit, is issued to each utility for every megawatt-hour of electricity generated by an eligible renewable energy resource. An active market exists for the purchase and sale of Green Tags. Idaho Power’s Elkhorn Wind project in Oregon and its Raft River geothermal project in south-central Idaho generated more than 320,000 MWh of Green Tags for Idaho Power in 2007 and 2008.
In January, the commission granted Idaho Power’s request to retire its Green Tags. Idaho Power wanted to retire the tags in anticipation of federal or state legislation that may require utilities to generate a specific amount of energy from renewable sources. By retiring the tags, Idaho Power said it could represent to renewable energy certification programs and to its customers that it is meeting customer expectations for increased use of renewable energy.
The Industrial Customers of Idaho Power petitioned the commission for reconsideration, arguing the value associated with the Green Tags belongs to the ratepayers and should be sold to benefit customers. Further, the industrial customers argued, allowing the utility to retire the tags causes them to lose value in the wholesale market.
The Idaho Conservation League and the Renewable Northwest Project argued that the commission affirm its original decision to let the utility retire the tags.
During reconsideration, Idaho Power modified its request, asking for authority to retire or “bank” the tags. Banking the tags would allow the company to stockpile tags now, when they are presumably less expensive to acquire, in anticipation of future mandatory renewable energy requirements.
In its order, the commission said it found no compelling evidence that banking the tags will “lessen the company’s burden in meeting a federal future standard.” Idaho Power’s request to bank or shelve the tags rests only on speculation that they may be used in the future, the commission said. “Unless and until the federal government establishes renewable energy standards and corresponding guidelines, we find the most prudent disposition of these Green Tags, at this time, is their sale.” However, the commission said, this order does not foreclose an alternative treatment for Green Tag sales in the future.