20220301Application.pdf

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Avista Corp.
141I East Mission P.O.Box3727
Spokane, Washington 99220-0500
Telephone [phone]
Toll Free 800-727-9170
March 1,2022 ';rr (-)
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Jan Noriyuki, Secretary
Idaho Public Utilities Commission
11331 W. Chinden Blvd. Bldg. 8, Ste.20l-A
Boise,Idaho 83714
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RE: AVU-C,-22-01 Avista Utilities Proposed Tariff Schedule 195 *Optional Renewable
Natural Gas"
Dear Ms. Noriyuki,
Attached for filing with the Commission is Avista Corporation's dba Avista Utilities
(Avista or the Company) proposed new TariffSchedule 195 "Optional Renewable Natural Gas."
The proposed schedule is included in the following tariffsheets, LP.U.C No. 28:
Original Sheet No. 195
Original Sheet No. 195A
I. INTRODUCTION
Through the attached Avista hereby proposes to implement a voluntary Renewable Natural
Gas (RNG) program (Program) that will provide natural gas customers within Avista's Idaho
natural gas service territory a voluntary opportunity to purchase RNG as part of their monthly
billing. Avista requests that the proposed Schedule 195 be approved to become effective on May
1,2022, and requests that the matter be processed under the Commission's Modified Procedure
rules through the use of written comments. Avista stands ready for immediate consideration on
its Application.
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II. BACKGROUND
ln May 2019, the Washington legislature enacted RCW 80.28.390 into law, whereby
utilities "must offer by tariff a voluntary renewable natural gas service available to all customers
to replace any portion of the natural gas that would otherwise be provided by the gas company".
ln response to the passage of RCW 80.28.390, the Company was prompted to develop a voluntary
Program to be made available to all of its Washington natural gas customers, which the Company
has enrolled 69 customers to date.
Also, in 2019 the Company conducted customer research across a subset of small, medium,
and large commercial customers located across its service territories in order to assess customer
interest and desire for a variety ofpotential products and services. This outreach included a set of
questions about RNG. The responses to these questions, along with a subsequent survey to
residential customers, were used by the Company to gain a beffer understanding of customer
sentiment towards RNG offerings and to better inform RNG program design.r Within the
commercial customer research, customers were presented with educational information pertaining
to RNG options and asked if they are likely to participate in an RNG program, which 24o/o of
commercial customers stated they were likely to participate before being presented with pricing
information. When pricing information was included, respondents interest declined as price point
increased, indicating that a premium-priced option would present a barrier to adoption for many.
A similar decline in interest was found with increased price points for residential customers. The
Company kept these survey results top of mind while deciding on project design and product
procurement. That said, Avista continues to believe that it is important to have a voluntary RNG
I The Company conducted a commercial customer research project in 2019 using the Shelton Group, a leading research
firm focused exclusively on energy and the environment. Avista also conducted internal research geared at residential
customers specifically regarding renewable natural gas programs in2020.
Page 2
program offering for its customers, and therefore designed a new tariffoffering as described below.
With ample RNG supply available to support a voluntary program across all of Avista's
natural gas service territory - including in Idaho, positive customer sentiment towards an RNG
program, and a swift uptick in customer enrollments amongst its Washington natural gas
customers, the Company believes the availability of a voluntary RNG program for its Idaho
customers to be a valuable option for its customers to have access to.
IIL PROGRAM DESIGN
Avista proposes to offer customers the ability to purchase blocks of RNG where each block
includes the environmental attributes represented by the equivalent to 1.5 therms of RNG at a price
of $5.00 per block.2 All charges related to the program are in addition to the customer's regular
natural gas charges.
ln terms of the RNG acquired for the Program, the Company signed an agreement with
Puget Sound Energy (PSE) to acquire the necessary volumes to support the Program. PSE has a
signed contract for RNG with Klickitat Public Utility District to acquire an estimated 550,000
dekatherms per year for the first three years with significantly more RNG in the years following.
The Company has structured the price to confine Program costs and benefits strictly to
Program participants, including the supply of RNG attributes and Program administration costs.
The breakdown of program costs is included as Attachment A to this frling.
Program enrollment will remain simple for customers and may be initiated online or over
the phone with a Customer Service Representative (CSR). Customers will have the opportunity to
2 Charges will appear on the customers' regular monthly bill as a separate line item and include appropriate taxes.
Page 3
participate with no contract required and will have the option to enroll and/or cancel participation
at any time in a given month. The ease of enrollment and no contractual obligations have been
validated as a customer satisfier in recent surveys and customer feedback sessions.
Natural gas customers will receive notification of the Program availability on the effective
date and once the Company has received approval of this filing, along with periodic information
and solicitation to participate in the Program. Avista will conduct additional customer outreach
and awareness as the program budget allows. These communications are intended to increase
program participation and deepen current program participants' engagement and satisfaction by
providing increased visibility into the benefits of the program.
The Company has identified key performance indications and will establish baseline
metrics that will continue to track Program performance in an effort to meet its primary objectives
of customer satisfaction, customer awareness, and customer participation. Customer satisfaction
will be measured by an annual Net Promoter Score (NPS) survey on an annual basis, measures
customer experience and customers' overall satisfaction with a company's products or services.
The Company will monitor customer awareness through extemal web traffrc to the Program page.
Finally, customer participation will be measured by the number of customers enrolling in the
Program and staying enrolled. All three of these mekics will be important as the Program strives
for higher levels of customer satisfaction and improved sentiment, ultimately driving broader
awareness and interest in support of renewable energy.
Lastly, the Company will utilize the Midwest Renewable Energy Tracking System (M-
RETS) forpurposes ofthe Program and retiring environmental attributes onbehalf ofparticipating
customers.
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TV. CONCLUSION
In conclusion, Avista is pleased to have designed a Program that gives an additional option
for natural gas customers seeking to reduce their carbon footprint through the purchase of RNG.
Avista requests that the proposed Schedule 195 be approved to become effective on May 1.,2022,
and requests that the matter be processed under the Commission's Modified Procedure rules
through the use of written comments.
Please note that certain sections of Attachment A contains CONFIDENTIAL information
and should be treated as CONFIDENTIAL. As such, the Company has provided both a
confidential and redacted version. Please direct any questions regarding this filing to Amanda
Ghering at [e-mail] or 509-495-7950 or to me at
[e-mail] or at 509 -495-27 82.
Sincerely,
St4arra goreldd
Sr. Manager of Regulatory Policy & Strategy
Regulatory Affairs
Page 5
|.P.U.C No.28 Sheet 195 195
AVISTA CORPORATION
d/b/a Avista Utilities
SCHEDULE 195
OPTIONAL RENEWABLE NATURAL GAS - IDAHO
AVAILABLE:
To Customers in the State of ldaho where the Company has naturalgas service. Customers
may participate in one or more available Renewable Natural Gas program options.
APPLICABLE:
To all customers receiving natural gas service who agree to participate in a program option
under this schedule.
PROGRAM OPTIONS AND CHARGES:
Low carbon energy program options available to customers will utilize the types of
Renewable natural gas and renewable hydrogen. The initial program option available will
be as follows:
Renewable Natural Gas - One (1) block includes the environmental equivalent
attributes associated with 1.5 therms of renewable natural gas. Each block is priced
at 55.00 per block, per month.
All program charges are included in the price of the block and shall be in addition to all
other charges contained in the custome/s applicable tariff schedule.
MONTHLY BILLING:
Renewable Natural Gas - The monthly billing shall be reflective of the number of Renewable
Natural Gas block(s) the customer has agreed to purchase multiplied by the Charge per
Block. The Monthly Billing is in addition to all other charges contained in custome/s
applicable tariff schedule.
This schedule's Monthly Billing shall be applied to the customer's billing regardless of actual
energy consumption.
lssued: March 1,2022
lssued by Avista Corporation
Effective: May 1,2022
By Patrick Ehrbar, Director of Regulatory Affairs
|.P.U.C No.28 inalSheet 195-A 195-A
AVISTA CORPORATION
d/b/a Avista Utilities
SCHEDULE 195 - Continued
RENEWABLE NATURAL GAS:
For the purpose of this schedule, the blocks will include the environmental attributes
unbundled from the actual fuel associated with Renewable Natural Gas consisting largely of
methane and other hydrocarbons derived from the decomposition of organic material in
la ndfills, wastewater treatment facilities, a nd anaerobic digesters.
The renewable natural gas sourced shall be recognized via the M-RETs tracking system or
another tracking system as required by the ldaho State legislature.
PROGRAM ADM INISTRATION :
To ensure that all costs and benefits of this program are only applied to program
participants, all funds collected and spent under this schedule wil! be separately identified
and tracked. Funds may include program costs (e.g.: program management, accounting,
communications, etc.) as well as to match block subscriptions to Renewable Natural Gas
environmental attribute purchases.
SPEC]AL TERMS AND CONDITIONS:
1. Service under this schedule is subject to the Rules and Regulations contained in this
tariff.
2. Customers may apply for, or terminate participation from, this schedule anytime
during the year.
3. Program may be temporarily closed or 'sold-out' to new program subscribers if
there is insufficient renewable natural gas inventory available.
4. The above Monthly Billing is subject to increases as set forth in Tax Adjustment
Schedule 158.
lssued: March 1,2022
lssued by Avista Corporation
Effective: May 1,2022
By Patrick Ehrbar, Director of Regulatory Affairs