Oregon PUC to take Public Comments on Power Rate Increases

Let your voice be heard. A public hearing regarding Pacific Power’s proposed 22% irrigation power rate increases is scheduled for April 30.

 

In an unprecedented move, PacifiCorp (aka Pacific Power) has proposed to increase irrigation pumping power rates for its Oregon ratepayers by an overall net amount of 21.5 percent on January 1, 2025.

The Oregon Public Utility Commission (OPUC) wants to hear from you. For PacifiCorp’s proposed rate increases, a Public Comment Hearing is scheduled from 6:00 p.m. – 7:00 p.m., Tuesday, April 30, 2024. The hearing will take place via Zoom and will be overseen by Judge Alison Lackey.

Zoom link [https://puc-oregon-gov.zoomgov.com/j/1601118631?pwd=UEljb2lkc0VwL2VEdVlyTzRFRTFIUT09]

PacifiCorp currently has three ongoing electric rate cases in the State of Oregon. These rate cases are being adjudicated before the OPUC, ultimately determining the final amount of the rate increases or decreases in each case.

“Klamath Water Users Association (KWUA) has intervened in all three of these rate cases in order to represent and protect the interests of water users in the Upper Klamath Basin,” said KWUA Executive Director Paul Simmons. “As an intervenor, KWUA can submit testimony, issue and review data requests, and participate in settlement negotiations between PacifiCorp, OPUC Staff, and the other parties to the cases.”

“In two cases, PacifiCorp has requested that the rate increases/decreases be effective January 1, 2025. The third case has been ongoing since 2021, and it is currently unknown when the rate increase associated with that proceeding will be effective,” stated Lloyd Reed, KWUA’s Power Consultant.

Reed added, “Whatever the final rate increases/decreases in the three cases become, it is essential to note that the rate impacts will be additive in nature.”

PacifiCorp’s proposed combined 2025 General Rate Case plus the 2025 Transitional Adjustment Mechanism rate increases for other customer classes are as follows:

• Residential: +20.7%
• Small Commercial: +21.6%
• Medium Commercial: +9.9%
• Large Commercial / Industrial: +12.4%

Complete details regarding each of the three cases can be found at: https://www.oregon.gov/puc/edockets/Pages/default.aspx

2025 General Rate Case, OPUC Docket Number UE-433

PacifiCorp filed its 2025 General Rate Case (GRC) with the OPUC on February 14, 2024, with the proposed new rates that would become effective January 1, 2025.

In this filing, PacifiCorp requests to increase its rates in Oregon by approximately $322.3 million annually. This overall increase translates to an average rate increase across all customer classes of +17.9 percent.

“For the agricultural class, PacifiCorp proposes increasing the Schedule 41 irrigation/drainage rate by +22.4 percent,” explained Reed. “Meanwhile, PacifiCorp’s last GRC in 2023 resulted in an average rate increase to Schedule 41 customers of approximately 5.2 percent.”

The primary drivers of the very large rate increase being sought by PacifiCorp are:

1. Increased wildfire mitigation and vegetation management costs,
2. Increased costs for wildfire insurance, and
3. Two new transmission projects and two wind plants are being placed into service for the first time.

“Approximately 51 percent of the overall requested rate increase is associated with increased wildfire-related costs. In addition, PacifiCorp is proposing to raise its Return on Equity [a measure of the Company’s profit margin] from the currently-in-effect figure of 9.5 percent to 10.3 percent,” stated Reed.

2025 Transitional Adjustment Mechanism Case, OPUC Docket Number UE-434

PacifiCorp filed its 2025 Transition Adjustment Mechanism (TAM) with the OPUC on February 14, 2024, with the proposed new adjustment to base rates to be effective January 1, 2025.

In this filing, PacifiCorp requests to decrease its rates in Oregon by approximately $18.3 million for the calendar year 2025. This figure translates to an average rate decrease across all customer classes of -1.0 percent. PacifiCorp proposes to decrease the Schedule 41 irrigation/drainage rate by -0.9 percent for the agricultural class.

PacifiCorp files its TAM cases annually to adjust its rates for changes in its variable power costs, also referred to as Net Power Costs. Examples of the key drivers that impact PAC’s Net Power Costs are:

1. Increases or decreases to forecasted fuel prices for PacifiCorp’s fleet of natural gas-fired and coal-fired power plants,
2. Increases or decreases in regional wholesale power prices, and
3. Increases or decreases in the forecasted value of certain tax credits that PAC receives on its fleet of wind plants.

Coal Plant / Coal Mine Decommissioning Cost Case, OPUC Docket Number UM-2183

PacifiCorp is in the process of retiring many of its coal-fired power plants and replacing them with non-GHG-emitting wind and solar facilities. In addition, PacifiCorp is in the process of closing several coal mines that it owns, which are utilized to fuel its coal plants.

PacifiCorp originally proposed to recover many of these decommissioning costs in its 2021 GRC. However, the OPUC did not allow the company to begin recovering in rates of approximately $25.4 million per year across the period 2022 – 2029 until it provided additional details regarding how it and a third-party consultant developed the cost estimates.

PacifiCorp initiated the UM-2183 proceeding in July 2021, intending to have the additional de-commissioning costs incorporated into rates beginning January 1, 2022.

However, OPUC Staff and the other parties to the case (including KWUA) proposed that PacifiCorp hire a third-party “independent evaluator” to review the previous decommissioning studies and provide an expert opinion on the reasonableness of the figures.

“The independent evaluator has completed its review,” stated Reed. “However, the case progresses very slowly, and there is no established date when the additional decommissioning costs will be incorporated into rates.”

If the OPUC ultimately approves the total amount of PacifiCorp’s original request and if the decommissioning costs are incorporated into rates beginning January 1, 2025 – the estimated increase to agricultural customers Schedule 41 irrigation/drainage rate would be approximately +1.9 percent across the period 2025 – 2029 (relative to the currently in-effect rate).

 

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Subject: Docket Number UE 433–Notice of Filing–Oregon PUC
Description: Notice of Public Comment Hearing (Zoom) served to UE 433 and UE 434 on 4/17/24.

PUBLIC COMMENT HEARING scheduled 4/30/2024 6:00 PM begin, 4/30/2024 7:00 PM end.
Room: ZOOM
Law Judge: LACKEY, ALISON

Docket Name:  PACIFICORP REQUEST FOR A GENERAL RATE REVISION
Utility Company:  PACIFIC POWER — ELEC, IV_E
Type of Activity:  PUBLIC COMMENT HEARING, filed on 4/17/2024.
To view this document, please click on the below link:

http://edocs.puc.state.or.us/efdocs/HCG/ue433hcg327940116.pdf

All parties on the Commission’s service list will receive email notices of all documents filed in this docket.  The Commission will also provide electronic service of all related rulings, notices, and orders via email.  If you are unable to view documents electronically and therefore need to receive hard copies, please send a statement of need to:

Public Utility Commission
Administrative Hearing Division
PO Box 1088
Salem, OR 97308-1088

For more information about eFiling, please visit the Filing Center page on the PUC’s website at https://www.oregon.gov/puc/filing-center/Pages/default.aspx.

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Download PDF: NOTICE_OF_PUBLIC_COMMENT_HEARING

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Cover photo caption: Pacific Power proposes a significant electrical rate increase of 22% for irrigation pumping use, effective January 1 of next year. This follows significant increases in each of the last two years. (KWUA File Photo)