20230919Comments of the Commission Staff.pdf

ADAM TRIPLETT
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
IDAHO BAR NO. 10221
Street Address for Express Mail:
11331 W CHINDEN BLVD, BLDG 8, SUITE 201-A
BOISE, ID 83714
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF ROCKY MOUNTAIN
POWER'S PETITION FOR APPROVAL OF
AN EXTENSION OF THE 2020 INTER­
JURISDICITONAL ALLOCAITON
PROTOCOL
)
) CASE NO. PAC-E-23-13
)
)
) COMMENTS OF THE
) COMMISSION STAFF __________________ )
COMMISSION STAFF ("STAFF") OF the Idaho Public Utilities Commission, by and
through its Attorney of record, Adam Triplett, Deputy Attorney General, submits the following
comments.
BACKGROUND
On April 12, 2023, PacifiCorp, dba Rocky Mountain Power ("Company"), petitioned
the Commission for an order modifying Order No. 34640, adopting a temporary cost allocation
methodology that is set to expire on December 31, 2023, ("Interim Period") and approving the
First Amendment to the 2020 Protocol ("Petition"). The First Amendment proposes an extension
of the Interim Period through December 31 , 2025, clarification of the Oregon exit dates, and
STAFF COMMENTS 1 September 19, 2023
RECEIVED
2023 September 19 11:54AM
IDAHO PUBLIC
UTILITIES COMMISSION
changes to Appendix C of the 2020 Protocol. Most Idaho jurisdictional stakeholders executed
the First Amendment. 1
On May 5, 2023, the Commission issued a Notice of Petition and Notice of
Intervention Deadline, setting an intervention deadline of May 26, 2023. Order No. 35770. No
intervenors applied.
STAFF ANALYSIS
Staff recommends the Commission approve the Application to extend the 2020 Protocol
to December 31, 2025.
History
The 2020 Protocol was approved by the Commission in Order No. 34640, Case No.
PAC-E-19-20, on April 22, 2020. The 2020 Protocol was to expire on December 31, 2023. Since
approval of the protocol, the Framework Issues Workgroup ("FIW") has met over 22 times to
resolve the framework issues established in the 2020 Protocol. Progress on the framework issues
is discussed in greater detail below.
Framework Issues Progress
New Resource Assignments
Initially the plan for new resource assignments was to establish a fixed allocation at the
implementation of the new resources. A fixed allocation could expose Idaho ratepayers to
additional risks as the electric landscape changes. Additionally, this could lead to overbuilding
the system which could reduce the benefits of a combined east and west system that ratepayers
currently enjoy. The FIW has begun developing a partially dynamic, partially fixed allocation
methodology for both new and existing resources. While still in its early stages, it is showing
promise for mitigating the risks of a changing environment as well and maintaining the benefits
of a combined system.
1 Staff, Idaho Conservation League, Idaho Irrigation Pumpers Association, and P4 Production L.L.C. signed. The
Company reached out to Pacificorp Idaho Industrial Customers but had not heard back from the organization at time
of filing.
STAFF COMMENTS 2 September 19, 2023
Net Power Cost Allocation
The Nodal Pricing Model ("NPM") is currently being used for dispatch of the Company's
resource fleet. It is not yet being used for allocation of Net Power Costs. The FIW is reviewing
the output from the NPM to evaluate the impacts on allocation. Several inputs in the NPM affect
the allocation amounts, requiring significant analysis. The Company has stated its intent to join
the Extended Day Ahead Market ("EDAM") with CAISO. EDAM is in practice nearly identical
to the NPM only that it will also include all other participants in EDAM versus only including
the Company's system.
Special Contracts
There has been little progress on the allocation of special contracts. A two-year
extension to the Interim Period will allow additional time to focus on the allocation of special
contracts.
Interim Capital Additions
Although interim capital additions have been discussed in the Multi-State Process
meetings, there is not a consensus at this time. The two-year extension to the Interim Period will
allow additional time for FIW to reach a consensus.
Content of the Extension
The primary effect of the Application is to extend the 2020 Protocol for an additional two
years. However, the Application also clarifies the exit dates established by the Oregon
Commission for coal plants. If a coal plant is converted to natural gas, the exit date will no
longer apply. There is also a minor change in Appendix C of the 2020 Protocol. The Division
Generation Utah Factor will be determined by the four most recent years. Overall, this will give
the FIW two more years to create a more durable allocation methodology.
Benefits of Approving the Extension
Should the 2020 Protocol lapse, there will no longer be a common allocation
methodology between all the states, leaving each state to determine its own allocation. Varying
jurisdictional allocation methodologies could create a scenario where the Company recovers
STAFF COMMENTS 3 September 19, 2023
more or less than all its prudently incurred costs to serve customers. It could also incentivize the
Company to favor one state or another based on their allocation methodologies and not the health
of the system.
Staff believes that a more durable allocation methodology is necessary, and the extension
of the Interim Period provides additional time for FIW to reach consensus on a new protocol.
STAFF RECOMMENDATION
Staff recommends the Commission approve the Application to extend the 2020 Protocol
until December 31, 2025.
Respectfully submitted this 19th day of September 2023.
Adam Triplett
Deputy Attorney General
Technical Staff: Joseph Terry
i:umisc/comments/ PAC-E-23-13 Comments
STAFF COMMENTS 4 September 19, 2023
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 19TH DAY OF SEPTEMBER
2023, SERVED THE FOREGOING COMMENTS OF THE COMMISSION STAFF
TO ROCKY MOUNTAIN POWER, IN CASE NO. PAC-E-23-13, BY E-MAILING
A COPY THEREOF, TO THE FOLLOWING:
MARK ALDER
ROCKY MOUNTAIN POWER
1407 WEST NORTH TEMPLE STE 330
SALT LAKE CITY UT 84116
E-MAIL: [e-mail]
DAT A REQUEST RESPONSE CENTER
E-MAIL ONLY:
[e-mail]
ADAM LOWNEY
McDOWELL RACKNER GIBSON
419 SW 11TH AVE STE 400
PORTLAND OR 97205
E-MAIL: [e-mail]
SECRETARY
CERTIFICATE OF SERVICE