Idaho Public Utilities Commission

Case No. PAC-E-09-07, Order No. 31021

March 23, 2010

Contact: Gene Fadness (208) 334-0339, 890-2712

Website: www.puc.idaho.gov

 

PacifiCorp can assess slightly higher rate to wind producers

 

The Idaho Public Utilities Commission is allowing PacifiCorp, which does business as Rocky Mountain Power in eastern Idaho, to charge a higher wind integration rate to developers of small wind projects, but not as large as requested.

 

Currently, PacifiCorp charges developers an integration rate of $5.10 per megawatt-hour. Citing increased costs to integrate wind into its overall generation portfolio, PacifiCorp requested a rate of $9.96 per MWh. The commission granted $6.50 per MWh, which is the same as the maximum amount allowed other utilities buying from small wind projects in Idaho, including Avista Utilities and Idaho Power Company.

 

The wind integration rate is intended to capture from developers of small-wind projects the cost the utility incurs to integrate wind into its transmission grid. Included in those costs are adjustments utilities make in their choice of generation options in order to accommodate wind. Also, because wind generation is unpredictable, utilities must have back-up generation in place for those times when wind is not producing the output anticipated.

 

The wind integration rate is discounted from the overall rate utilities must pay wind developers who qualify under the provisions of the federal Public Utility Regulatory Policies Act of 1978 (PURPA). Under PURPA, qualifying generators of small-power projects that generate up to 10 megawatts are paid a rate published by the commission. Wind integration costs are subtracted from the published rate.

 

PacifiCorp claims an updated study shows that it costs the utility in the range of $9.96 to $11.85 per MWh to integrate wind into its system. However, the Portland-based Renewable Northwest Project, which promotes the development of renewable energy, recommended the increase be denied because of flaws in the PacifiCorp study.

 

The commission noted there is no consensus on the methodology used to calculate wind integration costs. This case is not the appropriate forum to select a methodology, the commission said.

 

In setting the rate at $6.50, the commission acknowledged that PacifiCorp has added wind resources since the original $5.10 rate was set and that “integration costs have likely increased.”

 

“We encourage PacifiCorp to continue to refine its wind integration cost analysis,” the commission said. “We expect it to consider in its analysis and studies, the results of regional efforts and studies.” PacifiCorp recently initiated a new integration study it expects to complete in late summer.

 

A full text of the commission’s order, along with other documents related to this case, is available on the commission’s Web site at www.puc.idaho.gov. Click on “File Room” and then on “Electric Cases” and scroll down to Case Number No. PAC-E-09-07.

 

Interested parties may petition the commission for reconsideration by no later than April 2. Petitions for reconsideration must set forth specifically why the petitioner contends that the order is unreasonable, unlawful or erroneous. Petitions should include a statement of the nature and quantity of evidence the petitioner will offer if reconsideration is granted.

 

Petitions can be delivered to the commission at 472 W. Washington St. in Boise, mailed to P.O. Box 83720, Boise, ID, 83720-0074, or faxed to 208-334-3762.