IDAHO PUBLIC UTILITIES COMMISSION

Case No. IPC-E-05-26

Notice of Comment Deadline and Briefing Schedule

March 7, 2006

Contact: Gene Fadness (208) 334-0339

Website: www.puc.idaho.gov

 

IPUC taking comments on Idaho Power emission allowance sales

 

Groups participating in settlement discussions on how nearly $77 million in proceeds from Idaho Power’s sale of emissions allowances should be distributed were not able to agree after two workshops. Unless additional discussions are held, the Idaho Public Utilities Commission will settle the issue.

 

The commission is now seeking comment on the matter from the company, interested parties and the general public.

 

The commission recently granted Idaho Power Co. blanket authority to sell its surplus sulfur dioxide allowances and approved the accounting treatment proposed by the company. However, commission staff and others who participated in discussions were not able to agree on how much of those sale proceeds should be shared with Idaho Power customers. In its most recent report, Idaho Power says its sold 73,500 sulfur dioxide allowances, receiving pre-tax proceeds of $76,932,625.

 

An amendment to the 1990 Clean Air Act establishes a national program for the reduction of acid rain. Scientists have determined that sulfur dioxide (SO2) and nitrogen oxide (NOx) are the primary causes of acid rain. In the United States, about two-thirds of all SO2 and one-fourth of all NOx comes from thermal (coal and natural gas) electric generating plants.

 

Under the federal program, thermal power plant owners are issued limited allowances for their plants’ sulfur dioxide emissions based on a specific plant’s past emissions and a nationwide cap placed on the total amount of SO2 that can be emitted.

 

Each allowance authorizes the utility to emit one ton of SO2. At the end of each year, a utility generating unit must hold allowances equal to its allotted annual SO2 emissions. A utility that holds over its annual requirement is considered to have surplus allowances that can be sold on the open market or through auctions sponsored by the Environmental Protection Agency.

 

Idaho Power has an ownership interest in three coal-fired plants: Jim Bridger in Wyoming, North Valmy in Nevada and Boardman in Oregon. Last August, the commission agreed to give Idaho Power blanket authority to sell its emissions allowances as long as each sale is reviewed. Allowing Idaho Power blanket authority to sell its allowances, the commission said, allows Idaho Power to be able to react quickly to changes in the price of SO2 allowances and obtain the highest prices available.

 

Until it is determined how those proceeds should be distributed, Idaho Power will record the proceeds from such sales in a special account and periodically report to the commission about proceeds from those sales.

 

Public comments are accepted through March 31. The company will file its brief by April 14. Commission staff and the intervenor in the case, the Industrial Customers of Idaho Power, will file briefs on April 28 and the company will file its reply brief May 12.

 

Comments are accepted via e-mail by accessing the commission’s homepage at www.puc.idaho.gov and clicking on "Comments & Questions." Fill in the case number (IPC-E-05-26) and enter your comments. Comments can also be mailed to P.O. Box 83720, Boise, ID 83720-0074 or faxed to (208) 334-3762.

 

Documents related to this case, are available on the commission’s Web site. Click on “File Room” and then on “Electric Cases” and scroll down to the above case number.