20200206Final_Order_No_34545.pdf

omce of the Secretary
Service Date
February 6,2020
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF ROCKY MOUNTAIN )CASE NO.PAC-E-19-17
POWER'S PETITION TO INCREASE THE )BLUE SKY BLOCK VALUE FROM 100 TO )ORDER NO.34545
200 KILOWATT HOURS )
On October 25,2019,Rocky Mountain Power ("Company"),a division of PacifiCorp,
applied for approval to increase the size of each Blue Sky Block ("Blue Sky Block"or "Block")
offered under Schedule 70-Renewable Energy Rider-and Schedule 73-Renewable Energy
Rider Bulk Purchases (collectively"Blue Sky program"or "Program")-from100 kilowatt hours
("kwh")to 200 kwh.The Company requested that its Application be processed by Modified
Procedure and have an effective date of January 1,2020.
On December 3,2019,the Commission issued a Notice of Application and Notice of
Modified Procedure establishing public comment and Company reply deadlines.Staff filed the
only comments and supported the Company's Application.The Company did not reply.
The Commission now approves the Application as set forth below.
THE APPLICATION
Since 2003,the Company has offered a Blue Sky program that enables customers to
support renewable energy development by purchasing 100 kWh renewable energy Blocks.The
Company's Application was submitted in response to changes in the Renewable Energy Credit
("REC")market between the inception of the Blue Sky program in 2003 and today.The average
cost of RECs purchased for the Program have continued to decrease even as demand for the
Program has grown.To meet growing customer demand for the Program and better align the
Program with market conditions,the Company proposes to increase the size of a Block from 100
kWh to 200 kWh but keep the price of each Block the same.'At the Company's proposed price
per Block,customers who sign up for the Program,or continue to be enrolled,will cover the
incremental cost of acquiring the RECs plus the costs associated with offering the Program.
I Under Schedule 70 Blocks cost $1.95 each per month.Under Schedule 73 bulk purchases of Blue Sky Blocks can
be made for $0.70 per Block per month plus a $1,500 per year fixed charge if customers are purchasing a minimumof1,212 Blue Sky Blocks.For purchases of over 750,000 Blue Sky Blocks,the Company offers individually
negotiated contracts.
ORDER NO.34545 1
STAFF COMMENTS
Staff recommended the Commission approve the Company's request to increase its
renewable energy Blocks to 200 kWh.
The Company requested that the proposed changes to the Program in Idaho be contingent
upon the Company receiving approval from all other regulators in states where its blue sky
programs are offered.Staff disagreed with this approach and recommended the Company's
proposed changes to the Idaho Program become effective as of January 1,2020,regardless of
whether similar changes are approvedin other states.
Staff also recommended the Company buy RECs where the Company obtains the most
competitive pricing,with preference given to RECs sourced from non-PacifiCorp projects in
Idaho.
Staff noted it and the Company must "periodically revisit and evaluate the program"but
nothing requires the Company to provide Staff with data.See Order No.29329.Staff mentioned
that yearlyaudits have occurred,but onlybecause the Company's third-partyauditor-Green-E-
initiated the audits as part of its annual verification process.Staff recommends the Company
submit a Blue Sky Report by March 31 annually,and that the Company coordinate a yearly audit
with Staff ahead of the compliance determination request from Green-E or another Program
auditor.
In past reviews,Staff has expressed concern with a lack of qualifyinginitiatives undertaken
in Idaho.Although the price of RECs has dropped,creating surplus funds for qualifying
initiativeS2,no one had applied for a Blue Sky project in Idaho for over five years.In reviewing
the Company's Application,however,Staff learned that the Company is actively working with
interested parties on several Idaho qualifying initiatives.Additionally,Staff learned the Company
had eliminated barriers to entry for the qualifying initiative program by streamlining the
application process,removing project investment requirements,and opening award application
year-round.
2 Funds available after REC purchases,program marketing,and administration expenses are made available to help
fund new community-based renewable energy installations through a competitive grant application process i.e.for
qualifying initiatives.
ORDER NO.34545 2
COMMISSION FINDINGS AND DECISION
The Company is an electric corporation under Idaho Code §61-119,and a public utility
under Idaho Code §61-129.The Commission has jurisdiction over the issues in this case under
Title 61 of Idaho Code,including Idaho Code §§61-301,502,and 503.The Commission has
reviewed the record,including the Application and Staff's comments.Based on that review,the
Commission now approves the Company's Application to increase its Blue Sky program Block
size from 100kWh to 200kWh.
The Commission finds it reasonable that the changes to the Blue Sky program are effective
as of January 1,2020 regardless of approval in other states.Additionally,we direct the Company
to focus on procuring least-cost RECs to match Program demand,with preference given to non-
PacifiCorp projects in Idaho,when feasible.
Even as demand for the Program has grown,the price of RECs acquired to match demand
has fallen.In Order No.29329,we "direct[ed]Staff and the Company to periodically revisit and
evaluate the program to assure that program participants are not paying a premium for the same
renewable energy benefits enjoyed by all PacifiCorp customers."Based on the record and the
changing REC market,we believe it is appropriate to update the Program in Idaho.
When Order No.29329 was issued,the costs of RECs accounted for about 38%of the price
of a Block.Today,even with the increase in Block size,the cost of RECs will represent about 15%
of the Block price.We are encouraged by the decrease in REC costs since Order No.29329 was
issued.With the decrease in REC costs,the Company has had the opportunityto use revenues to
cover Program costs and set aside the remainder for qualifying initiatives under the Program
schedules.We are discouraged to learn that no Idaho qualifyinginitiatives had been applied for in
over five years but are glad the Company is working with interested Idaho parties on qualifying
initiatives.We direct the Company to continue to encourage applications for the qualifying
initiatives in Idahoand to operate the application process with reduced barriers.
We further direct the Company to file an annual "Blue Sky Program Report"by March 31.
This Report should help keep the Program Block size and cost aligned with the REC market prices.
It will also give the Commission a better opportunityto review the Company's efforts and success
in approving grants for qualifyinginitiative projects.
ORDER NO.34545 3
ORDER
IT IS HEREBY ORDERED that the Company's Application to increase renewable energy
Blocks for the Blue Sky program from 100kWh to 200kWh is approved,effective January 1,2020.
IT IS FURTHER ORDERED that the Company shall file a Blue Sky Program Report with
the Commission each year by March 31.
THIS IS A FINAL ORDER.Any person interested in this Order may petition for
reconsideration within twenty-one (21)days of the service date of this Order with regard to any
matter decided in this Order.Within seven (7)days after any person has petitioned for
reconsideration,any other person may cross-petition for reconsideration.See Idaho Code §61-
626.
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this
day of February 2020.
PAUÏ KJELiASDSPRESIDENT
KR)ŠÌINE PEli,MI IONER
ERIC ANDERSON,COMMISSIONER
Diane M.Hanian
Commission Secretary
1:\Legal\ELECTRIC\PAC-E-19-17\Orders\PACE1917 final dh.docx
ORDER NO.34545 4