20080225ICL Comments.pdf

,02/25/2008 MON 14:23 FAX [phone]
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Conservtion Legue
PO!3 844, f30ise, If) 8.1701
208.345.6933
IDAHO PUBLIC urnxlIES COMMISSION
POBox 83720
Boise, lD 83720-0074
Street Address:
472 W Washington 83702
HE: Case No. .IPC-F:-07-18, Order No. 30495 - Customer input soii~ht 011
how to trent emission snle revenues
Dear Commissioners:
Thank you for thc opportunity to comment on thc proposed use of revenue generated by
the sale of Idaho Power Company's sulfur dioxide emissions allowances. For thirty-nHI!'
yeals, the Idaho Conservation League has been Idaho's voíce for ckai1 water, clean air,
and wîlderness..-...values that are the fbundation to Idaho's extl'(\ordinnry qunlity o!dl¡fe.
Idaho Conservation League works to protect these valucs through citizen action, publìc
education, and professional advocacy. As Idaho's largest statc-bascd conservation
organization we represent over 9.500 members. many of whom have a deep personal
intercst in pl'tccting our clean aÎr, clean water, and quality of lie.
According to the 2007 Boise State University Energy Policy Survey. 50% of Idahoans
believe that the development of "greeil' or renewable electricity sources is of the highest
priority when addrcssing Idaho's electricity needs. Idahoan's have made their decision to
support renewable energy and Idaho Power, as a public utility, has an obligation to listen
to the will o!ïts customers. In Idaho and surrounding states. new wind and geothermal
projects are being developed annually. Renewable energy project development brings
needed investmcnt into Idaho's rural communities and offers "clcan" energy solutions to
the region.
Of the four options presented by Idnho Public Utilities Commission and Idaho Power
Company, Idaho Conservation League supports the third option:
"... 10 allow Idaho Power to enler negotiations or solidts bid,; to buy a wind praject 's
development rights. In essence, ¡he company "voulei be purchasing a wind prajecl with
capital..-. proceedo;.f;'om the SO,i sales ..... contributed hy eus/omers. ,.
Idaho Conscrvation League supports this option fix a number of reasons. This option
COnf()lllS to existing policy to increasc the reduction of hazardous emissions, supports
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renewabk e;nergy reSOl.irces, and allows Idaho Powcr Company to invest in generution
facilties while benefiting from the "green tags" thcsc facilities provide, In addition. this
option most closely follows the 20.year plan set forth in Idaho POWCI' Company's
Inier;l'aied Resource l'an (lRP) (2006). Idaho Power plans to add 250 MW ofwincl
energy by 2025. Investment iiiO wind energy can be f\.irihcr f'acilìtatcd with the sui Cur
dioxide credit proceedfi.
It is no secrct that thc cost of energy generation is incrcasing, According to the U.S
Energy Infì:)1nation Administration, natural gas used to power electrical plal1ts has more
than tripled in priee since i 999 and coal priccfi arc up 45 percent ovel' the same períod.
'rhe worldwide demand for steel, concrete;, Hnd other ìndustrial materials has led to
upward price pres$tu'es ror the development of energy tìicilities. It is appropriate, in light
of thesc economic factors, to turn to SOtlCCS of energy wìth stable eost projections and
long-term economic benefits f()r customers. Thc lack of fuel costs allows rencwable
sources, ¡ike wind facîlities~ to oflei' a relatively stable price over the lire olthe I¡icîiity.
Estimates from thc Encrgy Information AssocÎniiol1 phice the cost of wind encl'gy
between 3 and 5.5 cents per kilowatt-hour. 'rhe average retail price of clectricíty tì:)r
Idaho consumers is (;,21 cents per kilowatt-hour. ßy increasing investment into wind
energy Idaho Power could rcducc ovcrall electricity costs to retail consumers, No other
energy resource guarantees economically viable development costs and long~tcnn price
stability. Additionally, iii light of' expected federal carbon regulations. and possible
federal or rcgiomil porlJblio standards, Idaho Power cun reduce the initial costs associated
with compliance to programs. Idaho Power Company should usc the allowances to invcst
in wind cnergy facilities. reducing Idaho's carbon risk whilc mecting projected energy
demands.
By ìnvesling in wìnd facilities, Iclaho Power Company would also own the rcncwable
energy credits or ¡¡grcen tags'~ that are associated with these facilities. Currcntly, Idaho
Power is rcquired to purchase the output of qualified Public Utility Reguh.ltory Policies
Aet of 1978 (PllRPA) projects, but does \101 own the green tags associated with the
PURPA generalion, Investing in wind facilities allows Idaho Power to provide for
inCl'e,lsing energy demands while bendïting from the environmental attributes of green
tags associated with the wind facilities.
F¡nally~ option three fiis mosl appropriately with Idaho Power Company's 2006 my,
Idaho Power Company has planned to accommodate 11,000... 12,000 new retail
customers though 2025, This gl'wth is expected to inci'case demand by an additional
1300 MW over a 20-year planning pei'iod. Thc IRP calls rot' 250 MW of wii1d generation
by 2025. Providing fbI' additional wind generatíon would further support the two primary
goals or the 2006 IRP: 1) Identify suff.ícíent resources to reliably serve the growing
demand tì:)r energy within idaho Power's servicc arca throughout thc 20"ycal planning
period: and 2) Ensllc the portfolio of selected resourccs balances costsi risks, and
el1vimnincntal coneei'ns.
Using the sulfur dioxide allowances to invest in further renewable energy generation in
the near term wil aid in protecting consumers from thc dramatic cost increases associated
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with the dcvelopment of gencration facilities. I r the allowances today arc iised to preparc
for the regulations of tomorrow, Idaho Power can dilute the overall cost to consumers.
Thank you For the opportunity to commcnt on lhe usc of thesc funds. Please feci fi'ce to
contact me with for further c1ariJïcation 01' questions at (208) 345"6933 ex. 23.
Sincerely.
ötJ
Sara Cohn
Community Conservation Associate
Idaho Conscrvation League
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