20211013Initial Comments.pdf

Kelsey Jae (ISB No. 7899)
Law for Conscious Leadership
920 N. Clover Dr.
Boise,ID 83703
Phone: [phone]
[e-mail]
Attorney for C le an Ener gt Opportunitie s for ldaho
APPLICATION TO INITIATE A MULTI.PHASE
PROCESS FOR TIIE STUDY OF COSTS
BENEFITS AI\ID COMPENSATION OF NET
EXCESS ENERGY ASSOCIATED WITH
CUSTOMER ON-SITE GENERATION
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BEFORE THE IDAHO PUBLIC UTILITIES COM1VIISSION
CASE NO. IPC.EAHN
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INITIAL COMMENTS OF
CLEAI\ ENERGY
OPPORTUNITIES for IDAHO
REGARDING THE SCOPE OF
THE STTIDY
Please find below Clean Energy Opportunities for ldaho (CEO) comments regarding the scope of any study
developed pursuant to ldaho Powe/s Application. CEO's comments are organized as follows:
1. INTRODUCTION
2. VALUING EXPORTED ENERGY IS INHERENTLY DIFFERENT FROM SIUDYING FIXED COST RECOVERY
a. Conflation of separate studies
b. Public Notice
c. Discriminatoryimpact
d. CEO Proposed scope
3. TIME, LOCATION AND FORWARD.TOOKING IMPACTS ON COSTS MATTER WHEN VALUING THE
COSTS & BENEFITS, AS A RESOURCE TO THE COMPANY, OF AN EXPORTED KWh
a. ECR fair value is independent of customer class
b. Time & Location matter
c. Future resources to the system, such as exports, should be valued on a forurard-looking basis
4. PREDICTING REVENUE COLTECTION BASED ON HISTORIC FIXED COST ATTOCATIONS ACROSS AND
WITHIN CUSTOMER CTASSES (i.e. claimed "subsidies" associated with reduced consumption by
self-generatorsl SHOUTD BE OUTSIDE THE SCOPE OF THIS STUDY.
a. Expanding the scope of review beyond valuing energy exports to impacts "behind the mete/'
witl make the study incomprehensible by the general public and thus unfit for purpose
b. Favoring one method of reducing consumption over another is confusing and discriminatory
c. Defining a "partial requirement" sub-class of customers is problematic
d. Targeting customer generators is unjustified by the Company's own analysis of subsidies
5. DISTRIBUTED ENERGY RESOURCES (DERs| REPRESENT AN OPPORTUNITY - USE THEM, DON'T FIGHT
THEM
a. Expanding the use of DER's can serve state, commercial, industrial, and municipal interests
b. Removing barriers that impede access to solar self-generation is ritical to southern ldaho's
Ag sector
6. SUMMARY
1. !NTRODUCTION
It is policy in ldaho to encourage customer-owned generation. The most recent ldaho Energy Plan clearly
states "lt is ldaho policy to encourage investment in customer-owned generationl".
CEO requests the Commission to determine that in consideration of the policy direction noted above, as well
as the comments below, the scope of the referenced study should be designed to assist ldaho Power
customers in answering fundamental questions. CEO contends that to provide such guidance to ldaho Power
customers, the study now being scoped should be tightly focused and have multiple characteristics,
including:
L. Be fair, credible and understandable by the general public
2. Serve customer needs when answering custome/s questions such aso How much solar can I install for the purpose of self-generationo How would I be credited for any exported energy
3. Provide solutions that will be useful both:o Over a period of years via an update process
o ln allowing installers to meet their statutory requirements for informing potential
customers
CEO asks that the study process proceed in an expeditious and focused manner to both establish fair
compensation of net excess energy and remove the unnecessarily low cap on Cl&l projects, by requiring a
study scope that does not include the inherently different issues associated with rates and rate design for
consumption.
2. VALUING EXPORTED ENERGY IS INHERENTLY DIFFERENT FROM STUDYING FIXED COST RECOVERY
Fair compensation of exports should be informed by the costs & benefits ossocioted with exports, not
inflated or diminished based on fixed cost recovery issues associated with customers or customer classes.
Our concerns include:
Conflation of separate studies. The Commission has been clear and deliberate in separating issues
related to utility fixed cost recovery from issues that affect the value and method of compensation for
net excess energy., ln 2018, the Company, PUC Staff, and intervenors recognized this delineation when
r ldoho Energy P/on, adopted by the ldaho Legislature 316/2Ot2, pLl9
E-11. lt is ldaho policy to encourage investment in customer-owned generation; therefore the ldaho PUC, utilities,
municipalities, and cooperatives are encouraged to ensure non-discriminatory policies for interconnection and net
metering.
z Order 34045 (from IPC-E-17-13, at p31) instructed that the study address "proper rates and rate design, transitional
rates, and related issues of compensation for net excess energv provided as a resource to the Company." [emphasis
addedl. The Commissioners tied rate design and compensation issues to net excess energy, not to utility cost recovery
from particular customer classes. ln that same order which defined the study addressed by this docket, the Commission
also headlined their finding: "Vl. ANALYSIS OF FIXED COSTS lN SEPARATE DOCKEf (Order 34045 at p23).
As ordered, IPC-E-18-15 was the docket to contemplate changes to cost ofservice, revenue requirements, and rate
designs across customers. Stakeholders engaged time and resources into that docket, and progress was made. The
importance of linking cost allocations and rate design to future costs was emphasized, changes to cost of service
methodologies were recommended, and specific opportunities to mitigate future fixed costs were identified.
deliberating issues of compensation for net excess generation in IPC-E-18-15 and issues of fixed cost
recovery and rate design for consumption in IPC-E-18-15. Now parties are raising questions for this study
to analyze issues addressed in IPC-E-18-16, such as rate designs for consumption. This docket is
conflating into one study issues which were previously deemed important to separate.
b. Public Notice. This docket was titled and noticed to the public as related to the costs, benefits and
compensation of net excess energy. To contemplate rate design changes based on cost of service
methodologies in this docket would have implications for all customers. ldaho Power customers have
not been noticed that this study could impact their future rates for consumption. The study
contemplated in this docket is not an appropriate vehicle for review of revenue requirements or class
rate design via use of cost of service methodologies. We ask that, rather than revenue requirements and
cost allocations ossocroted with customers, the value stack of costs and benefits ossociated with exports
should be studied in order to inform fair and objective compensation for net excess energy.
c. Discriminatory lmpact. During IPC-E-L7-t3, many concerns were raised that if Customer generators were
placed in separate classes, those classes would be singled out for rate changes. The Commission
registered those concerns and stated, Order 34046, p25: "We can also assure the Company's customers
that discriminatory rates will not follow from the outcome of this case." The Commission also noted in
that Order, p15: "Further, cost of service issues will be fully vetted if and when the Company applies to
change the rates of customers that take and provide service under Schedules 6 and 8." [emphasis
addedl.
d. CEO Proposes: CEO asks that the spirit of the Commission's Order continue - that fair compensation for
net excess energy be established via this study process, that issues offixed cost recovery be
contemplated separately and holistically, and that cost of service issues be fully vetted only if and when
changes to all customer rates are considered.
CEO believes the scope of review in this study should be limited to:o how to measure the cost/benefits of customer energy exports to ldaho Power's system,o how much self-generation capacity a customer can install,. appropriate netting methods for quantifying the amount and timing of exports,. methods for valuation of those exports, and. processes for crediting customers for those values when exports are provided.
3. TIME, LOCATION AND FORWARD.TOOKING IMPACTS ON COSTS MATTER WHEN VATUING THE
COSTS & BENEFITS, AS A RESOURCE TO THE COMPANY, OF AN EXPORTED KWh
a. ECR fair value is independent of customer class. A fair value of net excess generation (the ECR), based
on the costs and benefits of such exports to the ldaho Power system, could vary with the time and
location of the export event, but would not be changed by the customer class of the exporter.
b. Time & location matter. Getting to a method for determining a fair value for exported power both now
and in the foreseeable future is a primary and essential component of this study. From CEO's
perspective, the value of exported energy will inherently vary depending upon the time and the location
of the export event. Thus, the study needs to consider various periods over which consumption and
production are "netted" to identify the existence of an export event and quantify the amount of energy
exported. Similarly, the study should provide for a method (even if such a method is not available today)
for calculating location values. We request a placeholder be added for Locational System Relief Value
(LSRV), that the study review approaches for including a LSRV in the value stack for the ECR in the future
and make recommendations for how such an LSRV can be added in future ECR updates.
c. Future resources to the system, such as expolts, should be valued on a forrvard-looking basis. When a
customer installs on-site generation that will provide exports as a resource, that generation will provide
benefits over a future period. ln analyzing the value of benefits provided by future year exports from
customer onsite generation resources, we propose using projections of future year and time period
energy marginal values (perhaps like the 5 annual price periods that represent season, day of the
week/holiday and time of day produced in each IRP). These values can easily be periodically updated to
reflect the latest IRP findings.
4. PREDICTING REVENUE COTTECTION BASED ON HISTORIC FIXED COST ATTOCATIONS ACROSS AND
WITHIN CUSTOMER CTASSES (i.e. claimed "subsidies" associated with reduced consumption by
self-generatorsl SHOULD BE OUTSIDE THE SCOPE OF THIS STUDY.
CEO whole-heartedly supports fair compensation for net excess generation. lf exports are fairly valued then,
by definition, any claimed "subsidies" associated with net excess generation are eliminated. CEO disagrees
with the assertion that reduced consumption by customer-generators justifies targeting customer-generators
for a study of issues impacting rates for consumption. CEO believes that any additional attempt to calculate
intra or inter class subsidies caused by some customers reducing their purchases from the Company via self-
generation should not be reviewed outside of a comprehensive rate case. Our reasons include:
a. Expanding the scope of review beyond valuing energy exports to impacts "behind the mete/'will make
the study incomprehensible by the general public and thus unfit for purpose. lnclusion of revenue
requirements is not required to calculate fair compensation for net excess energy. Expanding the scope
of this study to include matters related to historically based cost allocation and class based revenue
requirements is not readily understandable to the public. lf the study scope is expanded to include
"behind the mete/' cost allocation and recovery issues in a fair and comprehensive manner - which
would involve spreadsheets with dozens of columns and hundreds of rows - the study would become so
inherently complicated that CEO believes the goal of making this study understandable by the general
public would necessarily be violated.
b. Favoring one method of reducing consumption over another is confusing and discriminatory. IPC has a
long and well regarded history of encouraging customer efficiency. lnherently, customer efficiency
reduces energy purchases by such customers. Such reduction in energy purchases reduce that
custome/s contribution to the collection of fixed costs, potentially to the detriment of other customers.
While the Company actively encourages customers to reduce their purchases via efficiency upgrades,
when customers reduce their purchases via self-generation the Company raises concerns that self-
generators are harming other customers. We find this logic confusing and at odds with ldaho policy of
encouraging investment in customer owned generation.
c. Defining a "partial requirement''sub-class of customers is problematic. The Company attempts to
characterize customers with self-generation capabilities as being different: "partial requirements
customers". Where does the boundary between partial and full requirements customers lie? One might
assume that customers who replace their incandescent lamps with LEDs no longer have the "full"
requirements they needed before the LEDs were installed. Are most lrrigators considered partial
requirement customers due to the seasonality of irrigation? lf a customer installs an evaporative cooler
to replace an air conditioners and reduces their consumption in the process, are they no longer "full
requirements" customers? lf a customer switches from using a gas fired water heater by installing an
electric powered unit do they switch from being "partial "requirements to a full requirements customer?
There are many more examples where customers with different consumption patterns could be grouped
together (vacation vs full-time residences, rural single family detached units vs urban multiple units, for
example) without one being called out as only a partial customer. This amorphous designation is out of
scope and irrelevant to the costs and benefits of a kWh export.
d. Targeting customer generatom is unjustified by the Company's own analysis of subsidies. CEO
understands that tradeoffs are inherent in any rate design. lt has been said that rate making is an art
informed by science. With regard to the science, below are the results of the Company's own evaluation
of subsidies across classes3 showing substantial "subsidies" accruing to large customers. ln light of the
magnitude of the "subsidies" to these large customers identified in the Company's own study, CEO
questions how the isolated targeting of customer-generators for the order of magnitude lower revenue
reductions their reduced consumption could produce can be justified. lf "subsidies" need to be
addressed it should be done via a general rate case.
ldaho Ptror 2017 Class CGt d Sentlce
Figurc 5 provides a comparison by rate schedule of the amount of additional (or rcduced)
revenue collection neccssary to eliminate the exising revenuc surpluJdcficiency by class
according to the company's 2017 CCOS.
Residential
Large General
Small General
Small General On-Site
Residential On-Site
Large General (P/I)
lndustrial
lrrigation
(s1e.3Ml
(S14.5M)
(s1.0M)
So.oztvt
So.su
S1.7M
S8.6M
521.1M
Flgun 6
2(X7 company's CCOS mvenue cfiarqe roqufod by rate schedule (tM)
5. DISTRIBUTED ENERGY RESOURCES (DERs) REPRESENT AN OPPORTUNIW - USE THEM, DON'T FIGHT
THEM
a. Expanding the use of DER's can serve state, commercial, industrial, and municipal interests. Earlier this
summer ldaho Power informed interested parties that several dozen commercial, industrial and
municipal customers have expressed interest in increasing their purchases of "green" power. lf viewed
from an appropriate perspective, customers implementing ldaho policy by investing in self-generation
could help to meet these requests.o These exports by customer generators can further ldaho's policy
goals to develop abundant, diverse, in-state, clean energy resources.
b. Removing barrierc that impede access to solar self-generation is critical to southern ldaho's Ag sector.
Testimony in related earlier dockets (such as IPC-E-19-15 and tPC-E-20-26) documents concerns by ldaho
! IPC-E-18-16 Fixed Cost RepoG screen shot from page 14.
. By using customer exports, as verified by ldaho Power billing data, rather than the costly and administratively
burdensome method of obtaining formal REC certification for the green attributes delivered to those commercial,
industrial and municipal customers.
irrigation customers that regulatory barriers to new technology, such as solar self-generation, can put
them into a competitive dis-advantage relative to their competitors in mid-western states. PUC Staff has
noted that any reduction in demand by lrrigators could benefit all ratepayerss.
For Cl&l customers, nearly all projects are impacted by the 100kW cap5. That cap limits their access to an
affordable energy source and appears to directly contravene ldaho policy of encouraging investment in
customer owned generation. To complete this study process in a fair, focused, and timely manner, we
propose that a path for studying the pros and cons of updating the Ct&l cap according to customer
demand be completed under a separate docket launched as soon as possible after an order issues on this
study design proposal. The separate Cl&l cap docket should review a cap no less than a custome/s peak
electric load.
6. SUMMARY
CEO believes customers have inherent rights (subject to safety and power quality related concerns) to
generate some or all of their electric energy. To exercise these rights, customers need information, reviewed
and approved by the IPUC.
The Company has proposed that revenue requirements be analyzed, cost of service methodology be utilized,
and potential new rate designs for consumption by customer generators be evaluated. CEO believes those
are outside the scope of this docket and should be removed.
CEO asks that the scope of the study stay within the "cost, benefits, and compensation of net excess energy''
and that a primary design focus of the study should be to provide timely and understandable information to
ldaho Power customers to allow them to make informed decisions as technology advances provide them
with new ways to meet their electric power needs.
CEO further proposes that a path for studying the pros and cons of updating the Cl&l cap to align with peak
customer demand be completed via a separate docket launched as soon as possible after an order issues on
this study design proposal.
' "Staff notes that secondary level irrigation customers account for approximately 23% of summer peak demand, so any
reduction in lrrigator's demand could help defer the need for future generation and transmission plant." (PUC Staff
comments, tl2L/2020, IPC-E-18-16)
5 "Within the last two years, nearly all of the active or pending irrigation net metering customers in 2018 and 2019 have
installed or requested to install, on average, 99 kW systems to comply with the 100-kW limit at an individual meter
point." (lPC-E-19-15 application, p5)
CERTIFICATE OF SERVICE
I hereby certify that on this 13th day of October, 202t,I delivered true and correct copies
of ttre foregoing SCOPING COMMENTS to the following persons via ttre method of service
noted:
Elecronic Mail Delivery (See Order No. 34602)
Idaho Public Utilities Commission
Jan Noriyuki
Commission Secretary
[e-mail]. sov
Idaho PUC Staff
Erick Shaner
Deputy Anomey General
Idaho Public Utilities Commission
erick. [e-mail]. gov
ABC Power Company, LLC
Ryan Bushland
184 W. Chrisfield Dr.
Meridian,ID 83tr6
rvan. bushland@abcoow er. com
City of Boise
Deputy City Attorney
Boise City Attorney's Office
150 N. Capitol Blvd.
PO Box 500
Boise, ID 83701-0500
e iewell@citvofboise. ors
[e-mail]
CometEneryy,LLC
Georye Stanton
13601W. McMillan Rd, Suite 102
PMB 166
Boise,ID 83713
G eorge.stanton@cometenerg,v. biz
Idahome SolanLLC
Tller Grange
2484 N. Stokesberry PI. #100
Meridian, tD 83646
tvler@ idahomesolar.com
Idaho Irrigation P umpers Association, Inc.
Eric L. Olsen
Echo Hawk & Olsen PLLC
505 Pershing Ave., Suite 100
PO Box 611"9
Pocatello, ID 83205
[e-mail]
Idaho Power Company
Lisa D. Nordstrom
Connie Aschenbrenner
Idaho Power Company
1221 West Idaho Sree\ 83702
P.O. Box 70 Boise, Idaho 83707
lnordstrom@ idahopow er. com
dockets@ idahopower. com
caschenbrenner@idahopow er. com
IdaHydro
C. Tom Arkoosh
Arkoosh Law Offices
913 W. River Sneet, Suite 450
P.O. Box 2900
Boise,ID 83701
tom. [e-mail]
[e-mail]
Idaho Clean Energy ,4ssociation
Kevin King
P.O. Box 2264 Boise, ID, 83702
208{504880
staff@ idahocleanenergy. org
Idaho C onservation L eague
Benjamin J. Otto
710 N. 6th St. Boise,Idaho 83702
botto @ idaho conservation. org
Idoho Solar Owners Network
Joshua Hill
1625 S. Latah
Boise,ID 83705
joshuashill@ gmail. com
[e-mail]
Industial Customers of ldaho Power
Peter J. Richardson
Richardson Adams, PLLC
515 N. 27ttr St, P.O. Box 72L8
Boise,Idaho 83702
[e-mail]
Dr. Don Reading
6070 Hill Road Boise, Idaho 83703
dreadin g @ mindsorin g. co m
Richad E. Klucldtohn, pro se
Wesley A. Klucldtohn, prc se
2564 W. Parkstone Dr.
Meridian,ID 83646
[e-mail]
[e-mail]
Micrcn Technology,Inc.
Jim Swier
8000 South Federal Way
Boise,ID 83707
[e-mail]
Austin Rueschhoff
Thorvald A. Nelson
Austin W. Jensen
Holland & Hart, LLP
555 17th Sueet Suite 3200
Denve6 CO 80202
darueschhoff @hollandhart.com
rrelson@hollandhart. com
awjensen@hollandhart. com
aclee@hollandhart. com
sls a.rs anoamari@ hollandhart. co m
Kiki Leslie A. Ttdwell, pto se
704 N. River SL #1
Hailey,ID 83333
[e-mail]
rs\e
Kelsey Jae
Aaorney for CEO