20220330Meredith Direct.pdf

BEFORE TEE IDAEO PIIBLIC UTILITIES COMMISSION
rN Tm TUATTER OF TIIE APPLICATTON ) CASE NO. PAC-E-22-05
or RocKY MoIINTATN POWER )
REQTIESTING APPROVAL OF $2t.4 ) DTRECT TESTTMONY OF
MTLLON NET POWER COST DEFERRAL ) ROBERT Iltr MEREDTTH
ROCKY MOI'NTAIN POWER
CASE NO. PAC.EA2.Os
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Please state your name, business address and present position with PacifiCorp,
dba Rocky Mountain Power ("the Company").
My name is Robert M. Meredith.My business address is 825 NE Multnomah Street,
Suite 2000, Portland, Oregon 97232.My presentposition is Director, Pricing and Tariff
Policy.
Qualifications
Briefly describe your educational and professional background.
I graduated from Oregon State University with a Bachelor of Science degree in
Business Administration and a minor in Economics. [n addition to my formal
education, I have attended various industry-related seminars. I have worked for the
Company for 17 years in various roles of increasing responsibility in the Customer
Service, Regulation, and Integrated Resource Planning departments. I have over
I I years ofexperience preparing cost ofservice and pricing related analyses for all of
the six states that PacifiCorp serves. [n March 2016,I became Manager, Pricing and
Cost of Service. In February 2022,1assumed my current position.
Have you testified in previous regulatory proceedings?
Yes. I have previously filed testimony on behalf of the Company in regulatory
proceedings in Idaho, Utah, Wyoming, Oregon, Washington, and Califomia.
What is the purpose of your testimony in this proceeding?
My testimony presents and supports the Company's proposed rates to recover
the 2021Energy Cost Adjustment Mechanism ("ECAM") deferral balances through
Electric Service Schedule No. 94, Energy Cost Adjustment ("Schedule 94").
Meredith, Di-l
PacifiCorp
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Background
What level of revenue is Schedule 94 currently designed to collect?
Schedule 94 is currently designed to collect approximately $12.0 million-$4.8 million
for the Electric Service Schedule No. 400 ("Schedule 400") customer and$,7.2 million
for standard tariffcustomers-based on Idaho loads from Case No. PAC-E-I5-09.
Proposed Rate Change for Schedule 94
Please describe the Company's proposed rate change in this case.
The 2021 ECAM application proposes to increase Schedule 94 rates to recover
approximately $25.3 million from June 1,2022 to May 31,2023. The $25.3 million
includes $28.4 million for the 2021ECANI Deferral, plus approximately $1.5 million
remaining from the 2020 ECAM balance, for a total balance of $29.9 million as of
December 31,2021. This is offset by $4.7 million Schedule 94 forecasted revenue
collection from January 1,2022 through May 31,2022, as shown in Table 2 of Mr.
Jack Painter's testimony. Mr. Painter explains in his testimony the components of the
202 1 EC AM defened balance.
What is the impact of the proposed ECAM rates?
As summarized in my Exhibit No. 2, these rate change proposals result in an increase
of 6.0 percent for Schedule 400. Standard tariff customers will see an average increase
of 3.9 percent.
Meredith, Di-2
PacifiCorp
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I Renewable Energy Credit (REC) Revenue Treatment for Schedule 400
2 Q. Like previous ECAM filings, did the Company set prices for Schedule 400 to be
3 the same as other transmission voltage standard tariffcustomers?
4 A. No. It was necessary to create a different ECAM rate for Schedule 400 to exclude the
5 REC revenues in the ECAM from Schedule 400's rates.
6 Q. Why are REC revenues excluded from Schedule 400's rates?
7 A. On March 29,2021, PacifiCorp filed an application requesting Commission approval
8 of an agreement entered into with the sole Schedule 400 customer under which the
9 Company will retire, rather than sell, this customer's allocated share of RECs
l0 generated post-2020 from system resources.l The Company discontinued sale of
I I ldaho-allocated system RECs associated with the Schedule 400 load in202l, so that
12 the Schedule 400 customer's allocated share of system RECs could be retired on its
13 behalf. The REC revenue that Schedule 400 would otherwise have been allocated
14 from the sale of post-2020 system RECs will be removed from Schedule 400's rates.
15 Schedule 400 will continue to receive REC revenue from the sale of any RECs
16 generated prior to 2021.
17 On August ll, 2021 , Commission Order No. 35 I 3 I approved this agreement.
l8 Based on the terms of the agreement, the Company withheld the Schedule 400
19 customer's share of 2021 RECs from any auctions or sales. Beginning on January l,
20 202l,the Schedule 400 customer will no longer receive a REC revenue credit for
2l RECs generated after December 31,2020. If the Company was able to sell RECs
I In the Muter of the Joint Application Between RoclE Mountain Power and P4 Production, L.L.C. Requesting Approval of an Agreement to
Retire RECS, Case No. PAC-E-21-08, OrderNo. 35131.
Meredith, Di-3
PacifiCorp
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generated prior to 2021, Schedule 400 will receive credit for its share of those REC
revenues.
How did you calculate the Schedule 400 ECAM rate?
Prior to this change there were three rates developed to collect the ECAM deferred
balance: one rate for all customers taking service at secondary voltage levels; another
rate for those taking service from primary voltage; and a third rate for customers
taking service at transmission voltages. To calculate the Schedule 400 rate, REC
revenue credits allocated to Schedule 400 were removed from the transmission
voltage rate.
Are you able to remove all of the REC revenue credits in Schedule 400 rates
through the ECAM?
No. The ECAM only tracks the incremental difference between actual REC revenues
received during the deferral period and the REC revenue credit in base rates. The base
rates were established in Case No. PAC-E-16-12 with a REC revenue credit of 9 cents
per megawaff hour. That credit was calculated by taking Idaho's allocated REC revenue
credit divided by ldaho's load at meter for that test period.
Did Schedule 400 continue to receive a REC revenue credit through its retail rate
during calendar year 2021?
Yes. As described above, the Schedule 400 retail rate was reduced by 9 cents per
megawatt hour due to the REC revenue credit in the test period. Since this REC revenue
credit is in base rates and not in the ECAM a separate payment from the Schedule 400
customer will be necessary to reimburse the Company for REC revenues in Schedule
400 rates.
Meredith, Di-4
PacifiCorp
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How did the Company calculate the REC revenue credit Schedule 400 received
during 2021, through base rates, for the sale of post-2020 RECs?
The Company calculated the REC revenue credit Schedule 400 received through retail
rates by multiplying Schedule 400's2021retail energy used at meter by the REC credit
in base rates. During202l, Schedule 400's retail rates were reduced by $112,804 for
REC revenues. This balance needs to be adjusted for any pre-2021 vintage REC sales
revenues.
Does the Company know the Schedule 400 share of pre-2021 vintage RECs sold
during calendar year 2021?
Not at this time. While the total pre-2021 vintage REC revenues are known, the
Company hasn't finalized the jurisdictional allocation factors necessary to allocate
those to Idaho and then to Schedule 400. Once the allocation factors are finalized the
Company can calculate Schedule 400's share of pre-2021vintage REC revenues that
would reduce the $112,804 REC payment the Schedule 400 customer owes the
Company.
Is the calculation to determine the Schedule 400 customer's reimbursement for
2021vintage RECs sold during calendar year 202lnecessarT before finalizing the
ECAM?
No. The Company has calculated a separate ECAM rate for Schedule 400 that removed
the REC revenues that were deferred in the ECAM. The second adjusfirent doesn't
impact the ECAM and can be addressed separately. Once the Company has finalized
the allocation factors it can finalize the calculation of the net REC credit that the
Schedule 400 customer should reimburse to the Company. The Company intends to
Meredith, Di-5
PacifiCorp
I include the reimbursement as a one-time charge in one of the Schedule 400 customer's
2 bills during 2022.
3 Calculation of Proposed Rates for Schedule 94
4 Q. How were the proposed Schedule 94 rates developed for all customers?
5 A. The proposed rates for all customers were developed in five steps. First, kilowatt-hour
6 ("kwh") consumption at the generation level was developed by multiplying their retail
7 loads at the delivery service voltage level with the corresponding line loss factors.
8 Second, an overall average rate at the generation level was developed by dividing the
9 total collection target identified above with their kWh consumption at the generation
l0 level. Third, rates by delivery voltage level were developed by multiplying the above
I I overall average rate at the generation level with the corresponding line loss factors.
12 Fourth, the rate for Schedule 400 was increased by 0.003 cents per kWh to account for
13 the $0.1 million adjustment to REC revenue included in the 2021 ECAM, which
14 Contract Tariff 400 had elected to forego per the terms of the REC agreement. This
15 results in a proposed $9.6 million ECAM recovery from the Schedule 400 customer.
l6 Finally, the overall proposed collection of $25.3 million was reduced by the $9.6 million
17 share for Schedule 400, and rates for standard tariff customers were developed to collect
l8 the remaining $15.7 million using similar logic to that described in the third step. As a
l9 result, the Company proposes Schedule 94 rates for standard tariff customers of 0.733,
20 0.720 and 0.696 cents per kWh for secondary, primary and transmission delivery service
2l voltages, respectively. The rate for Schedule 400 is 0.700 cents per kWh.
22 a. Please describe Exhibit No.2.
23 A. Exhibit No. 2 shows the 2020 loads used to develop rates, the line loss adjusted loads,
Meredith, Di-6
PacifiCorp
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the allocation of,the ECAM price change, and the percentage chango by rate schedule.
Pleaso describe Exhibit No. 3.
Exhibit No. 3 contains clean and legislative copies of the proposed Elecfiic Service
Schedule No. 94, Energy Cost Adjustnent. The Company requests that the proposed
Schedule 94 rates become effective on June 1,2022.
Does this conclude your direct testimony?
Yes.
Meredith, Di-7
PacifiCorp
Case No. PAC-E-22-05
Exhibit No. 2
Witness: Robert M. Meredith
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
ROCKY MOI.JNTATN POWER
Exhibit Accompanying Direct Testimony of Robert M. Meredith
March2022
Rocky Mountain Power
Exhibit No. 2 Page 1 of 1
Case No. PAC-E-22-05
Wtness: Robert M. Meredithn:
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Case No. PAC-E-22-05
Exhibit No. 3
Witness: Robert M. Meredith
BEFORE THE IDAHO PI.'BLIC UTILITIES COMMISSION
ROCKY MOUNTAIN POWER
Exhibit Accompanying Direct Testimony of Robert M. Meredith
March2022
LP.U.C. No. 1
ROCKY MOUNTAIN
POWER
A OtVtStON OF PACTFTCORP
Roclry Mountain Po$rer
Exhibit No.3 Page 1 of 2
Case No. PAC-E-22-05
Wtness: Robert M. Meredith
ThirteenthTurelfth Revision of Sheet No. 94.1
Canceling TwelfthElerrcnth Revision of Sheet No. 94.1
ROCKY MOUNTAIN POWER
ELECTRIC SERVICE SCHEDULE NO.94
STATE OF IDAHO
Energy Cost Adjustment
AVAILABILITY: At any point on the Company's interconnected system.
APPLICATION: This Schedule shall be applicable to all retail tariffCustomers taking service under the
Company's electric service schedules.
ENERGY COST ADJUSTMENT: The Energy Cost Adjusnnent is calculated to collect the
accumulated difference between total Company Base Net Power Cost and total Company Actual Net Power Cost
calculated on a cents per kWh basis.
MONTHLY BILL: In addition to the Monthly Charges contained in the Customer's applicable
schedule, all monthly bills shall have applied the following cents per kilowatt-hour rate by delivery voltage.
Delivery Voltase
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
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400
Secondary0.W( perkWhg.g@( per kWh
0.W)31perkWh
0.3547331per kWh
0.354?331per kWh
Primary
O.ru( per kWhO.ru( per kwh
0.34#,7200 per kWh
0.W120( perkWh
0.34?2,9.i per kWh
0.W120( perkWh0.rui per kWh
Transmission
0.3+?696( per kWh
0.+?Wi perkWh
0.W133i perkWh
03s4133t per kWh
0.3s4733( per kWh0.*ru9 per kWhg.gSW( perkWh
0.35W( perkWh
0.354133! per kWhyW( per kWhg.Wt perkWh
Submitted Under Case No. PAC-E-22L05+
ISSUED: Ne+emge{aarch 430. 2022+EFFECTM: luneJanuary l, 2022
I.P.U.C. No. I
ROCKY MOUNTAIN
POWER
A DIVISION OF PACIFICORP
Rodry Mountain Po\ rer
Exhibit No. 3 Page 2 ol 2
Case No. PAC-E-22-05
l^/ihess: Robert M. Meredith
Thirteenth Revision of Sheet No. 94.1
Canceling Twelfth Revision of Sheet No.94.1
ROCKY MOUNTAIN POWER
ELECTRIC SERVICE SCHEDULE NO.94
STATE OT'IDAIIO
Energy Cost Adjustment
AVAILABILITY: At any point on the Company's interconnected system.
APPLICATION: This Schedule shall be applicable to all retail tariffCustomers taking service under the
Company's electric service schedules.
ENERGY COST ADJUSTMENT: The Energy Cost Adjustnent is calculated to collect the
accumulated difference between total Company Base Net Power Cost and total Company Actual Net Power Cost
calculated on a cents per kWh basis.
MONTHLY BILL: In addition to the Monthly Charges contained in the Customer's applicable
schedule, all monthly bills shall have applied the following cents per kilowatt-hour rate by delivery voltage.
Delivery Voltage
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
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36
400
Secondary
0.733( per kWh
0.7330 per kWh
0.733( per kWh
0.733(, per kWh
0.7331, per kWh
0.7339 per kWh
0.733( per kWh
0.733( per kWh
0.7330 per kWh
0.733i per kWh
0.733i per kWh
0.733( per kWh
0.733(, per kWh
0.733i per kWh
Primary
0.720( per kWh
0.720( per kWh
0.720( per kWh
0.720( per kWh
0.720( per kWh
0.720( per kWh
0.720i per kWh
Transmission
0.6961 per kWh
0.7001 per kWh
Submitted Under Case No. PAC-E-22-05
ISSUED: March 30,2022 EF'X'ECTM: June l,2022