20090918Decision Memo.pdf

DECISION MEMORANDUM 1
DECISION MEMORANDUM

TO: COMMISSIONER KEMPTON
COMMISSIONER SMITH
COMMISSIONER REDFORD
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL

FROM: SCOTT WOODBURY
DEPUTY ATTORNEY GENERAL

DATE: SEPTEMBER 18, 2009

SUBJECT: CASE NO. PAC-E-09-07 (PacifiCorp)
PETITION TO INCREASE PUBLISHED AVOIDED COST
INTEGRATION ADJUSTMENT

On September 11, 2009, PacifiCorp dba Rocky Mountain Power filed a Petition with
the Idaho Public Utilities Commission (Commission) for an Order increasing the published
avoided cost wind integration rate from $5.10 to $9.90 per MWh. Avoided cost rates are the
purchase price paid to qualifying small power production facilities (QFs) for purchases of QF
capacity and energy.1 The proposed change will be applicable to purchases by Rocky Mountain
Power of electric power from wind-powered QFs except in those circumstances where the QF
developer agrees in the power purchase agreement to deliver QF output to Rocky Mountain
Power on a firm hourly schedule.
BACKGROUND
The Commission in Order No. 29839, Case No. IPC-E-05-22, found that the supply
characteristics of wind generation and related integration costs could provide a basis for
adjustment of the published avoided cost rates, an adjustment that may be different for each
utility. In subsequent Order No. 30497 in Case No. PAC-E-07-07, the Commission approved a
Settlement Stipulation which by its terms required Rocky Mountain Power to file notice with the
Commission of any changes to its wind integration costs as reflected in subsequent changes to its
Integrated Resource Plan (IRP). Settlement Stipulation, Section III(a)(c)(d).

1 Reference Sections 201 and 210 of the Public Utility Regulatory Policies Act of 1978 (PURPA) and the
implementing regulations of the Federal Energy Regulatory Commission (FERC).
DECISION MEMORANDUM 2
PETITION
Rocky Mountain Power submits as Exhibit A to its Petition, an excerpt from
PacifiCorp’s 2009 IRP Appendix F – “wind integration costs and capacity planning
contributions” in which PacifiCorp provides a description of the methodology used and the
results derived from PacifiCorp’s analysis of the wind integration cost issue. The Company’s
2009 IRP wind integration cost analysis identifies its wind integration cost to be $9.96 per MWh.
The Company filed its 2009 IRP with the Commission on May 29, 2009 in Case No. PAC-E-09-
06. A Notice of the Company’s IRP filing was issued on June 24, 2009; the deadline for filing
written comments was July 31, 2009. Commission Staff was the only party to file comments.
On September 15, 2009, the Commission issued an acceptance and acknowledgement of the
Company’s 2009 IRP filing.
COMMISSION DECISION
Rocky Mountain Power and Commission Staff recommend that the Company’s
Petition be processed pursuant to Modified Procedure, i.e., by written submission rather than by
hearing. Reference Commission Rules of Procedure, IDAPA 31.01.01.201-204. Does the
Commission concur with the recommended procedure?

Scott Woodbury
Deputy Attorney General

bls/M:PAC-E-09-07_sw