Tariff Advice 00-02.pdf

DECISION MEMORANDUM 1
DECISION MEMORANDUM

TO: COMMISSIONER HANSEN
COMMISSIONER SMITH
COMMISSIONER KJELLANDER
MYRNA WALTERS
RON LAW
TONYA CLARK
DON HOWELL
STEPHANIE MILLER
DAVE SCHUNKE
RICK STERLING
WORKING FILE

FROM: SCOTT WOODBURY

DATE: March 17, 2000

RE: PACIFICORP TARIFF ADVICE NO. 00-02
PROPOSED SCHEDULE 70
NEW WIND, GEOTHERMAL AND SOLAR POWER RIDER—Optional

On March 10, 2000, PacifiCorp dba Utah Power & Light Company (PacifiCorp;
Company) filed a Tariff Advice with the Idaho Public Utilities Commission for approval of a
new renewable energy tariff, Schedule 70 New Wind, Geothermal and Solar Power Rider—
Optional. The Company makes this filing pursuant to Commission Order and Company
commitment in the recent merger case between PacifiCorp and ScottishPower, Case
No. PAC-E-99-01.
The proposed Schedule 70 tariff, the Company states, will allow customers who so
choose to purchase blocks of energy from new renewable generation resources. The customer
will choose the number of blocks to purchase, which is not dependent on the amount of energy
used. Customers who participate will pay an additional $4.75 per month per 100 kWh block of
renewable energy. This premium is in addition to the normal billed rate. The premium will be
used to cover the costs of the program. These costs include marketing costs, program
administration and the incremental cost of the new renewable energy.
For accounting purposes, the Company states that the costs associated with the
program will be booked in accordance with normal FERC accounting procedures. For the
purpose of earnings demonstrations (i.e., Results of Operations reports, general rate cases, etc.), a

DECISION MEMORANDUM 2
normalizing adjustment will be made to remove the revenues, program costs and above-market
costs of the energy associated with the program from the revenue requirement calculation. This,
the Company states, will assure that no costs are borne by non-participants.
This program, the Company states, is considered by it to be a generation program.
As such, all revenues and costs will be allocated system-wide using the generation allocation
factors.
The Company states that it will provide annual reports commencing October 31,
2000. The reports will include the revenues received, blocks purchased, blocks generated or
contracted for, and other program costs. The annual reports will include both the 12 months
ended September 30 period and the period from the program inception. The reports are intended
to provide the Company, Commission and interested parties with the information necessary to
assure that the program revenues are just sufficient to cover the program costs over the life of the
program. After an initial two-year period, the Company states that it will review the revenues
and costs associated with the program. The Company may at that time request before the
Commission that the program be modified to adjust the price and/or the size of the blocks
purchased to match the costs and revenues on an ongoing basis. Attached to the Company’s
Application is a program description Q&A with further details. Included in the Q&A is a
financial analysis of the program and an example of the program accounting.
In accordance with IDAPA 31.01.01.134, PacifiCorp requests that Schedule 70
become effective April 12, 2000.
Commission Decision
Staff recommends that the Company’s Application be processed as a formal case
rather than a Tariff Advice and that comment be solicited pursuant to Modified Procedure. What
is the Commission’s preference regarding procedure?

Scott Woodbury

vld/M:Schedule70_sw