20160413Reply Comments.pdf

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April 13,2016
OVERNIGHT DELIWRY
Jean D. Jewell
Commission Secretary
Idaho Public Utilities Commission
472W. Washington
Boise,lD 83702
RECEIVED
?fi|$ fl.PR I 3 AH ll: 02 1407 W. North Temple, Suite 310
Salt Lake City, Utah 84116
RE: CASE NO. PAC-E-16-07IN THE MATTER OF THE APPLICATION OF ROCKY MOI'NTAIN POWER
REQUESTING AUTHORITY TO MODIFY ELECTRIC SERVICE SCHEDULE 135 .
NET METERING SERVICE
Attention: Jean D. Jewell
Commission Secretary
Please find enclosed for filing an original and seven copies of Rocky Mountain Power's Reply
Comments in the above-referenced matter.
Informal inquiries may be directed to Ted Weston, Idaho Regulatory Manager at (801) 220-
2963.
Very truly yours,
,)tt**tf,, hr-ta.n/a*
Jeffrey K. Larsen
Vice President, Regulation
Enclosures
Yvonne R. Hogle (ISB# 8930)
Rocky Mountain Power
1407 West North Temple, Suite 320
Salt Lake City, Utah 84116
Telephone: [phone]
Email : wonne.ho gel@Facifi corp.com
Attorneyfor Rocly Mountain Power
APPLICATION OF
ROCKY MOUNTAIN POWER
REC E IVE D
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BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
rN THE MATTER OF THE APPLICATION ) CASE NO. PAC-E-16-07
oF ROCKY MOUNTAIN POWER )
REQUESTING AUTHORTTY TO MODIr"r ) REPLY COMMENTS OF
ELECTRTC SERVTCE SCHEDULE 135 - ) ROCKY MOUNTAIN POWER
NET METERING SERVICE )
COMES NOW, Rocky Mountain Power, a division of PacifiCorp ("the Company"),
pursuant to the procedural schedule established by Commission Order No. 33484 hereby
respectfully submits the following Reply Comments.
In support of these Reply Comments, Rocky Mountain Power states as follows:
BACKGROUND
l. On April 6,2016, Staff of the Idaho Public Utilities Commission ("Staff'),
and the Idatro Conservation League ("ICL") filed comments on the Company's Application
in this matter to modiff Schedule 135 - Net Metering Service, to increase the participation
cap from 714 kilowatts to 2,000 kilowatts. Both Staff and ICL recommend that the cap be
removed altogether rather than increased and that the Commission reject the Company's
proposed reduction to the maximum cumulative generating capacity per customer from 20
percent ofconnected load to 5 percent.
Page 1
Staff cited the Commission's decision to remove Idaho Power's cap and the
concern that "a cap may disrupt and have a chilling effect on the investment in and
installation of distributed generation."l Therefore, Staff recommends that the Commission
remove the cap consistent with Order No. 32846 for Idaho Power. Instead of a cap, Staff
proposes that the Company file an annual net metering report to serve as a useful checkpoint
on the status of net metering in order to provide the Commission and Staff with better
information when evaluating possible costs and benefits of net metering.
3. Staff also recommends that the maximum amount of generation that any
single customer can interconnect should remain at 20 percent of the cumulative generation
nameplate capacity connected to the Company's system in Idaho, rather than the Company's
proposed reduction to 5 percent.
4. Similar to Staff, ICL recommends that the Commission treat the Company
consistently with Idaho Power and decline to set an overall capacity cap, which, they argue,
imposes an arbitrary limit on the net metering program and isn't necessary because reliability
issues have not been identified.
5. ICL also recommends that instead of "layered arbitrary limits" the
Commission should adjust the amount of generation a customer may connect to 120 percent
of the customer's average monthly load. ICL explained that 120 percent would ooaccount for
uncertainty in system performance and growth in household consumption."2
RESPONSE
'StaffComments atp. 3 (April 6,2016),citing OrderNo.32846 (CaseNo. IPC-E-12-27).
'ICL Comments at p. 3 (April 6,2016).
APPLICATION OF
ROCKY MOUNTAIN POWER
Page 2
by
While the Company does not oppose the annual net metering report proposed
the Company continues to recommend that the Commission retain an overall
program cap, which the Company proposes to be 2,000 kW. First, when net metering was
initially implemented the Commission found a cap "reasonable" and that rationale continues
to exist. The existing cap hasn't had a chilling effect on participation, in fact, participation in
the net metering program has been accelerating and the Company has continued to accept
every application that meets the requirements of Schedule 135. What the cap does, however,
is provide a publicly known checkpoint for when net metering could be evaluated, rather than
relying on the timing associated with filing general rate cases. While the current magnitude
of cost shifting is small, net metering customers continue to be subsidized by the Company
and other customers.
7. When the Commission approved this program it was concerned: "that the full
cost of the program we approve today may not be borne only by participants... We also
expect fuither information from the Company regarding cost shifting and the Company's
ability to recover customer costs from program participants." s
8. Staff raised similar concerns:
"Staff believes the proposal to credit customer generators at full
retail rates will pay customers more than the actual value of the
generation... For the Commission to accept a net metering tariff
where customer generation is credited at full retail rates, it must be
willing to accept the fact that PacifiCorp may not recover its full
costs of providing service from net metering customers. Those
costs that are uncollected must either come from PacifiCorp
through its shareholders or from other customers collectively."a
3 Case No. PAC-E-03-04, Order No. 29260.
a Case No. PAC-E-03-04, Order No. 29260.
APPLICATION OF
ROCKY MOUNTAIN POWER
Page 3
9. The Company's Application confirmed, as suspected by Commission and
Staff, compensating net metering customers at full retail rates for their generation pays them
more than the value of the electricity they generate. This subsidy causes cost shifting to other
customers to the extent net meter customers are included in the rate design of a general rate
case, and the Company for any new customer participation in between rate cases.
10. The last general rate case where the Company's cost of service and rate design
was addressed utilized 2009 customer information and loads. ln 2009 there were 59 net
metering customers with I 15 kilowatts of nameplate capacity. The Company maintains that
the proposed cap, in conjunction with annual reporting, will provide a reasonable checkpoint
to monitor net metering. As discussed below, the Company proposes filing an annual report
on progrirm participation and would use the timeline at which the cap is reached, or a general
rate case, whichever comes first, to more comprehensively provide an evaluation of the costs
and benefits of net metering.
ll. In regards to StafPs proposal to retain the 20 percent maximum cumulative
generating capacity per customer, the intent of the Company's proposal to reduce it to 5
percent was to retain the maximum in proportion to the cap. If the Commission removes the
cap altogether, the Company would recommend that this maximum cumulative generating
capacity per customer be eliminated. Without an overall cap, this provision would be more
administratively difficult to implement as the denominator in the equation to calculate the 20
percent would be a moving target. Additionally, Schedule 135 already provides a cap per
installation, which provides a reasonable protection against oversizing. The definition section
in Electric Service Schedule No. 135 - Net Metering Services states: "An Eligible Generating
Plant may not have a generating capacity of more than twenty-five (25) kilowatts for
APPLICATION OF
ROCKY MOUNTAIN POWER
Page 4
customers taking service on Schedules 1, 36,23 or23A or one hundred (100) kilowatts for
all other customers."
12. ICL's recommendation to allow installations up to 120 percent of customers'
average monthly load should be rejected because it is inconsistent with the principle behind
net metering of allowing a customer to offset his or her usage. Allowing a customer to over-
size his or her facility moves the customer into the realm of a power producer rather than a
self-generator and would increase the cross-subsidies that are already occurring.
13. Lastly, as previously noted the Company is agreeable to providing annual
reports to the Commission on net metering participation. Specifically, the Company
proposes to file an annual report on or around April I each year that provides the number of
customers on net metering, generator types, and total name-plate capacity for the prior
calendar year. This will allow the Commission and Staff the ability to monitor the growth in
net metering. At the time that the proposed cap is reached, or as part of the Company's next
general rate case or other filing in which the Company proposes changes to net metering,
whichever is sooner, the Company proposes to provide a more comprehensive report on net
metering that includes estimates of total generation and contribution to system and class
peaks as part ofa cost ofservice analysis.
CONCLUSION
WHEREFORE, Rocky Mountain Power respectfully requests that the Commission
issue an order increasing the cap from 714 kilowatts to 2,000 kilowaffs for Electric Service
Schedule No. 135 - Net Metering Service, subject to the reporting identified above, effective
May 1,2016.
APPLICATION OF
ROCKY MOUNTAIN POWER
Page 5
DATED this 13e day of April,2}l6
APPLICATION OF
ROCKY MOUNTAIN POWER
Respectfu lly submitted,
Page 6
CERTIFICATE OF SERVICE
I hereby certiS that on this l3s of April, 2016,I caused to be served, via e-mail a true
and correct copy of the foregoing document in PAC-E-I6-07 to the following:
Benjamin J. Otto Ted Weston
Idatro Conservation League Rocky Mountain Power
710 N 66 Street 201 S. Main Street, Suite 2300
Boise,ID 83701 Salt Lake City, Utah 8411I
[e-mail] [e-mail]
Yvonne Hogle Data Request Response Center
Rocky Mountain Power PacifiCorp
201 S. Main Street, Suite 2400 825 NE Mulfiromah Street, Suite 2000
Salt Lake City, Utah 841l l Portland, Oregon 97232
[e-mail] [e-mail]
Kaley McNay
Coordinator, Regulatory Operations