PacifiCorp Informational Update

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PacifiCorp Informational Update
Presented to the Utah Geothermal Power
Generation Workshop by Ernie Wessman PacifiCorp
VP, Resource Development Construction August
2005
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IRP Implementation Update Utah SB-26 Overview
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Utah Senate Bill 26

• Background
• High growth, transmission constraints
• Need for significant new resources
• Multiple potential suppliers
• PacifiCorp procurement decisions
• Currant Creek and Lake Side best cost/risk
  balance
• Perception of self-build/own bias
• Debt imputation not well understood
• Concerns raised with legislators

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Utah SB 26 Legislative History

• Grew out of concerted effort during legislative
  interim
• Enacted 2/25/05 after unanimous House and Senate
  approval
• Immediate effective date
• Passed after bills stalled in 2003 and 2004
• Broad range of collaborators

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Utah SB 26 Content

• Defines significant energy resource
• 10 year/100 MW minimums
• Any resource transaction with an affiliate
• Requires significant energy resources to be
  procured through PSC-approved solicitation
  process
• Exemptions limited to
• Emergencies
• Valuable time-limited commercial or technical
  opportunity
• Other public-interest reasons

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Utah SB 26 Content

• PSC to establish rules to frame solicitations
• Criteria for screening potential bidders
• Methodology for evaluating competing bids
• Level of information to be disclosed to bidders
• Participation and role of independent evaluator
• Multi-state issues

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Utah SB 26 Content

• 10-phase Process
• Utility completes IRP/Action plan
• Utility submits proposed RFP solicitation process
• a. Utility may seek exemption
• PSC approves/modifies RFP solicitation process
• Utility conducts solicitation
• PSC hires independent evaluator
• Utility submits resource selection and cost to
  PSC for review
• PSC reviews resource selection and
  approves/rejects
• Utility proceeds with procurement
• a. Utility may seek mid-course review of
  decision by PSC
• Resource becomes part of utility portfolio
• PSC orders recovery of actual costs up to
  pre-approved level
• a. Costs above authorization w/o mid-course
  review are subject to PSC review
• b. Costs above authorization w/mid course review
  are fully recoverable

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Utah SB 26 Expected Outcomes

• Up front agreement on conduct of solicitations
• Transparent bidding process
• Independent review of process compliance
• Transparent basis for evaluation/selection of
  resources
• More stakeholder confidence in utility decisions
• Greater certainty of cost recovery
• Potential to improve rating agency confidence

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• Thank You