20231227Final_Order_No_36038.pdf

ORDER NO. 36038 1

Office of the Secretary
Service Date
December 27, 2023

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

On October 16, 2023, Rocky Mountain Power, a division of PacifiCorp (“Company”),
applied for approval of its updated load forecast, natural gas price forecast, and contracts used as
inputs in the Company’s Integrated Resource Plan (“IRP”) avoided cost calculations, as required
by Order Nos. 32697 and 32802. IRP avoided cost rates are available to qualifying facilities
(“QFs”) that exceed the resource-specific project eligibility cap for published avoided cost rates
under Idaho’s implementation of the Public Utility Regulatory Policies Act of 1978 (“PURPA”).
The Company requested its Application be processed by Modified Procedure with an effective
date of October 15, 2023. On October 24, 2023, the Company filed an Errata to correct the effective
date requested in the Application to January 1, 2024.
On November 2, 2023, the Commission issued a Notice of Application and Notice of
Modified Procedure establishing public comment and Company reply deadlines. Order No. 35980.
Staff filed the only comments.
Having reviewed the record, the Commission issues this Order approving the
Company’s Application as follows.
BACKGROUND
Pursuant to the PURPA and the Federal Energy Regulatory Commission’s (“FERC”)
implementing regulations, this Commission has approved the IRP Method to calculate avoided
cost rates for qualifying facilities (“QFs”) that are above the resource-specific project eligibility
cap. QFs that are below the applicable project eligibility cap are eligible to receive published
avoided cost rates calculated using the surrogate avoided resource (“SAR Method”). See Order
No. 32697 at 7-8. The avoided cost rate is the purchase price paid to QFs for the energy, or the
energy and capacity, that the QF provides to the utility. 18 C.F.R. § 292.101(b)(6)(defining
“avoided cost”). To ensure that avoided costs most accurately reflect the utility’s marginal cost of
energy or capacity, the Commission has directed utilities to “update fuel price forecasts and load
IN THE MATTER OF ROCKY MOUNTAIN
POWER’S APPLICATION TO UPDATE
LOAD AND GAS FORECASTS USED IN THE
INTEGRATED RESOURCE PLAN AVOIDED
COST MODEL
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CASE NO. PAC-E-23-20

ORDER NO. 36038
ORDER NO. 36038 2

forecasts annually – between IRP filings,” and to update the Commission about its “long-term
contract commitments because of [their] potential effect . . . on a utility’s load and resource
balance.” Order No. 32697 at 22.
THE APPLICATION
The Company stated that the overall increase in its 2023 proposed load forecast relative
to the May 2022 forecast (as shown in table one of the Company’s Application) results primarily
from growing expectations of commercial and industrial customers in Utah.
The Company also stated that its most current Official Forward Price Curve (“OFPC”)
was completed on September 29, 2023. The Company indicated that, except for Sumas, gas prices
are relatively unchanged or slightly down compared to last year.
Additionally, the Company stated that it entered 29 long-term contracts—including 23
with QFs—for a total nameplate capacity of 1,717.6 megawatts (“MW”). Only five long-term
contracts expired without renewal for a total nameplate capacity of 63.4 MW. The Company also
has 46 non-PURPA, long-term power purchase agreements with a nameplate capacity of 4,806
MW and 163 PURPA QF contracts with a total nameplate capacity of 2,206 MW.
STAFF COMMENTS
After reviewing the Application, Commission Staff (“Staff”) recommended approval
of the proposed load forecast and the natural gas forecast for use in the IRP model to determine
avoided cost rates, with an effective date of January 1, 2024. Staff also believed the contract
changes listed in the Application are reasonable. As IRP-based PURPA contracts have two-year
contract terms, only the first few years of load and natural gas forecasts are relevant to these
annually submitted updates.
1. Load Forecast
After comparing the Company’s energy forecast in this case, last year’s load case (Case
No. PAC-E-22-16), and analyzing the Company’s proposed system load, Staff believed the
Company’s proposed load forecast is reasonable. Staff noted that the proposed load forecast for
2023 through 2027 is lower than last year’s. However, Staff believed that the Company reasonably
explained this decrease by pointing to delayed projects for commercial and industrial customers in
Utah and Oregon.
Despite believing the load forecast to be reasonable, Staff noted two irregularities that
fall outside the timeframe relevant to this case. First, Staff observed that the forecasted load for
ORDER NO. 36038 3

FERC customers falls to zero after July 1, 2027.1 Second, Staff noted a significant reduction in
Idaho’s load that the Company indicated resulted primarily from lower expectations for a single
customer, increased energy efficiency, and growing private generation. When Staff requested
information about the FERC customers and a large Idaho customer, the Company objected and
withheld the information—citing confidentiality concerns. Ultimately, Staff believed the
information is not critical to this case considering the load reduction during the relevant timeframe.
However, Staff indicated that it expects the Company will provide this information when it is
relevant.
2. Natural Gas Forecast
After comparing the proposed Henry Hub forecast, the Company’s natural gas forecast
from last year, and Idaho Power’s Henry Hub forecast, Staff believed the Company’s proposed
natural gas forecast is reasonable. Although this year’s Henry Hub forecast is lower than last
year’s, the Staff believed this is reasonable due to the reduced impact of the Russia/Ukraine War
on European markets. Staff further noted that the similarity between the Company’s proposed
Henry Hub forecast and Idaho Power’s over the next few years reinforces its reasonableness
conclusion.
3. Contract Updates
Although the IRP model incorporates contract updates continuously, the annual load
and gas update is an opportunity for Commission review and supervision of contract updates. Staff
noted that the Company has signed 29 long-term contracts since last year’s case, and five long-
term contracts have expired. Staff believed these contract updates are reasonable.
COMMISSION DISCUSSION AND FINDINGS
The Commission has jurisdiction over this matter under Idaho Code §§ 61-501, -502
and -503. The Commission is empowered to investigate rates, charges, rules, regulations, practices,
and contracts of public utilities and to determine whether they are just, reasonable, preferential,
discriminatory, or in violation of any provision of the law, and to fix the same by order. Idaho
Code §§ 61-502 and -503. Additionally, the Commission has authority under PURPA and FERC
regulations to set avoided costs, to order electric utilities to enter fixed-term obligations for

1 Staff described FERC customers as those buying energy wholesale and then re-selling it to different retail
end users.
ORDER NO. 36038 4

purchase of energy from QFs, and to implement FERC rules. The Commission may enter any final
order consistent with its authority under Title 61, Idaho Code, and PURPA.
Under this authority, we have reviewed the record, including the Application and
Staff’s comments. We find that the Application complies with our directives in Order Nos. 32697
and 32802. The load growth and natural gas price forecasts are reasonable as filed given the
information available at this time. The Commission further finds that all contract changes as filed
are reasonable.
O R D E R
IT IS HEREBY ORDERED that the Company’s annual updates to its energy load and
natural gas price forecasts are reasonable and approved, effective as of January 1, 2024.
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 about 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 27th day
of December 2023.

ERIC ANDERSON, PRESIDENT

JOHN R. HAMMOND JR., COMMISSIONER

EDWARD LODGE, COMMISSIONER

ATTEST:

Monica Berrios-Sanchez
Interim Commission Secretary
I:\Legal\ELECTRIC\PAC-E-23-20_Forecast\orders\PACE2320_final_at.docx