20200520Comments.pdf

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JOHN R. HAMMOND, JR.
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
(208) 334-03s7
IDAHO BAR NO. 5470
Steet Address for Express Mail:
I 1331 W CHINDEN BVLD, BLDG 8, SUITE 2OI-A
BOISE, D 83714
Attorney for the Commission Staff
BEFORE THE IDAIIO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF AVISTA
CORPORATION'S PETITION FOR ANt
EXTENSION TO FILE ITS NATT]RAL GAS
INTEGRATED RESOT]RCE PLAN
CASE NO. AW-G.2O.OI
COMMENTS OF THE
COMMISSION STAFF
The Staffof the Idaho Public Utilities Commission submits the following comments
regarding the above referenced case.
BACKGROT]ND
On January 15,2020, Avista Corporation ("Company") filed a Petition seeking a filing
extension from August3l,2020 to April 1,2021for the Company's Natural Gas Integrated
Resource Plan ("IRP").
Washington and Oregon recently passed legislative bills that could have impacts on the
Company's natural gas planning. As a result, the Company represents it will take several months
to create and implement final rules and expectations for natural gas distribution utilities, which
will affect the ability to fully realize the impacts on the IRP process. Id.
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ISTAFF COMMENTS MAY 20,2020
STAFF ANALYSIS
Staffreviewed the Company's petition and researched the issues regarding the Company's
proposal. Staffreviewed the value of the proposed IRP extension against the possible negative
effects of a delay and concludes:
1. An extension from August 31,2020, to April 1,2021, for the 2020 Natural Gas
IRP is appropriate in order to allow the Company to include the effects of
Washington and Oregon legislation on its long-term resource plan which will
affect Idaho customers.
2. Because the Company's 2018 Natural Gas IRP did not show any resource deficits
in its expected case, Staffbelieves the proposed extension will not negatively
impact planning for future deficits.
3. The2019-2020 IRP Action Plan, as described in the 2018 IRP, is not affected by
the proposed extension and should continue to be pursued by the Company as it
develops its 2020IRP.
Each of the conclusions will be discussed in more detail below along with Staff s
recommendations.
Appropriateness of the Extension
Staffbelieves the Company's request for an extension is appropriate because
without it, the Company's Natural Gas IRP would not include the significant effects of recently
passed Washington and Oregon legislation. Granting an extension provides the Company time
to assess and incorporate these impacts.
There are multiple legislative bills in Washington and Oregon that could impact the
Company's natural gas planning. Of primary concern are Washington Senate Clean Energy
Transformation Act ("CETA") or Senate Bill 5l l6 (which requires l00o/o carbon free electricity
by 2045 and includes Renewable Natural Gas), Washington House Bills 1257 and 1444 (which
include new energy efficiency standards for buildings and appliances starting n2022), and
Oregon Senate Bill 98 (which along with Washington House Bill1257, creates a path for
Renewable Natural Gas acquisition). Final rules for natural gas companies, including Avista, are
yet to be determined so the precise impact of these bills on the IRP process is not yet known. In
light of these uncertainties, Staffbelieves extending the schedule is a reasonable option for the
Company to determine and incorporate the effects of recently passed legislation in its IRP.
2STAFF COMMENTS MAY 20,2020
Natural Gas Resource Deficits
The Company's 2018 Natural Gas IRP did not identiff any resource deficits in the
expected case scenario. However, in the High Growth and Low Prices scenario, existing
resonrces would not meet peak demand starting in year 2032. The Company did not recommend
options to address the2032 deficiency in its 2018 IRP because the deficit is well past the five-
year planning horizon required for natural gas IRPs. Staffbelieves that a filing extension does
not increase resource risk because there is sufficient time to analyze resource altematives before
the2032 deficit.
Additionally, the Company increased the number of defined demand areas in its 2018
IRP. This change allowed the Company to separate demand areas by state. Separating the states
benefits Idaho by providing greater detail and allows the model to accept inputs that affect each
state differently, including legislative policy differences.
2019-2020 Natural Gas IRP Action Plan
The Company's 2018 Natural Gas IRP included a2019-2020 Action Plan ("Action
Plan"), which outlines activities for study, development, and preparation that should be
undertaken for the 2020 IRP. 2018 IRP at 183-184. A summary of the key points of the 2019-
2020 Action Plan are as follows.r
Avista's 2020 IRP will contain an individual measure level for dynamic DSM
program structure in its analytics. [n prior IRP's, it was a deterministic method
based on Expected case assumptions. [n the 2020IRP, each portfolio will have
the ability to select conservation to meet unserved customer demand. Avista will
explore methods to enable a dynamic analytical process for the evaluation of
conservation potential within individual portfolios.
2. Work with Staffto get clarification on types of natural gas distribution system
analyses for possible inclusion in the 2020 IRP.
3. Work with Staff to clariff types of distribution system costs for possible inclusion
in our avoided cost calculation.
4. Revisit coldest on record planning standard and discuss with TAC for prudency.
5. Provide additional information on resource optimization benefits and analyze risk
exposure.
I Staff notes that only items l-5 relate to Idaho.
STAFF COMMENTS 3 MAY 20,2020
6. DSM- Integration of ETO and AEG/CPA data. Discuss the integration of ETO
and AEG/CPA data as well as past program(s) experience, knowledge of current
and developing markets, and future codes and standards.
7. Carbon Costs - consult Washington State Commission's Acknowledgement
Letter Attachment in its 2017 Electric IRP (Docket UE-161036), where emissions
price modeling is discussed, including the cost of risk of future greenhouse gas
regulation, in addition to known regulations.
8. Avista will ensure Energy Trust ("ETO") has sufficient funding to acquire therm
savings of the amount identified and approved by the Energy Trust Board.
See generally OrderNo.34227 at 4.
Staffbelieves the 2019-2020IRP Action Plan is not impacted by an extension and should
continue to be pursued by the Company as it develops its 2020 IRP frling.
STAFF RECOMMENDATION
Staff believes an extension from August 31,2020, to April 1,2021, for the 2020 Natural
Gas IRP is appropriate in order to allow the Company to include the effects of recently passed
Washington and Oregon legislation in its long-tenn resource plan.
Staff recommends the Commission:
l. Grant the Company an extension to file its2020 Natural Gas IRP on April l,
2021, rather than August 31, 2020.
2. Direct the Company to pursue its 2019-2020 IRP Action Plan.
Respectfully submitted ttns 2Ch day of May 2020
Hammond
Attorney General
Technical Staff: Kevin Key
Mike Morrison
i:umisc :commentVavug20. I dhkkmm comments
4STAFF COMMENTS MAY 20,2020
CERTIF'ICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 20ft DAY OF MAY 2020,
SERVED TttE FOREGOING COMMENTS OF THE COMI\ISSION STAFF, IN
CASE NO. AW-G-2o-OI, BY E-MAILING A COPY THEREOF, TO TIIE
FOLLOWING:
LINDA GERVAIS
MGR REGULATORY POLICY
AVISTA CORPORATION
PO BOX3727
SPOKANE WA99220-3727
E-MAIL: [e-mail]
avistadockets@ avistacorp. com
DAVID J MEYER
VP & CHIEF COUNSEL
AVISTA CORPORATION
POBO)(3727
SP0KANE WA99220-3727
E-mail: david.meyer(Eavistacorp.com
SECRETARY
CERTIFICATE OF SERVICE