Public Hearing Begins Into "Unusual" Investigation Of Pacificorp's Energy Roadmap

Jul 14, 2020

Expected coal retirements based on Pacificorp's 2019 IRP preferred portfolio
Credit Pacificorp

The Wyoming Public Service Commission (PSC) has begun a week-long hearing regarding its investigation into a western utility's 20-year Integrated Resource Plan (IRP) released in October, 2019.

The preferred portfolio would retire several coal plant units in Wyoming along with New Mexico and Montana. It would then develop significant solar, wind, and battery storage resources throughout the region.

IRPs are generally accepted for filing without any further action. Chris Petrie, PSC chief counsel, said last year this is the first IRP to be investigated by the commission to his knowledge. The investigation itself was announced in November, 2019 .

"Given the potential impact of [Rocky Mountain Power's] Preferred Portfolio on Wyoming customers, it is necessary and desirable that the Commission commence a contested case proceeding, pursuant to the Wyoming Administrative Procedure Act, to allow the Commission and other interested parties to adequately explore all aspects of the 2019 IRP," the order reads.

Pacificorp has six states in its service territory. The five others have reviewed and acknowledged the plan. In previous state legislative hearings, lawmakers have called on the PSC to simply reject the plan; the PSC does not currently have the authority to do that

There are nine intervening parties in the matter including advocacy, industry, and government organizations along with two businesses. Prior to opening statements, Rocky Mountain Power had the opportunity to present context to the proceedings. Counsel Jake McDermott recognized the profound impacts of the transition away from coal in Wyoming.

"Impacts such as these invariably affect the political and economic environment in which… however, these factors do not change Rocky Mountain Power's core duties. They also do not change this commission's mission as the economic regulator to ensure the company carries out those duties," he said.

At the end of the day, McDermott said the PSC needs to recognize the utility has checked the required boxes.

"There can be no doubt that the company has met its legal requirement in Wyoming," he said.

Opponents to the plan including industrial energy customers, an energy company looking to develop carbon capture, local governments affected by the plan, and a state citizens group.

The Coalition of Local Governments represents Sweetwater and Lincoln counties where Rocky Mountain Power plans to retire several coal units early. Kent Connolly, coalition chairman and Lincoln County commissioner, argued that an investigation like this was necessary. He said the utility's decision is already having major impacts to his county, with the closure of one of the Naughton Power Plant's three units.

"Naughton number 1 go down, number 2 go down... I lose 50 percent of the taxes, it's just that simple," he said. "If they keep them in the system, even don't tear them down or demolish them, I still get the property taxes."

Connolly is referring to the potential impact of a state law that would mandate utilities to search for a buyer of a retired coal plant when closing it.

He goes on to say 40 to 50 residents have already left the southwest Wyoming region and that he's seen a $3.7 million tax impact from the closure of Unit 3 of the Naughton Power Plant. Connolly said we need to take care of Wyoming, the lifestyle, and its future.

"That's why I think what we're doing is appropriate and very much on target on how we've got to look at these things in the future," he said.

Dale Cottam, counsel for Glenrock Energy and Big Muddy Inc, argued for the outright rejection of the IRP, arguing the company's analysis left out questions regarding carbon capture. Proponents for the plan pushed back that a rejection isn't within the commission's authority.

Wyoming Industrial Energy Consumers (WIEC) argued that this investigation should be devoted to improving the review process of Integrated Resource Plans in the future, given it felt RMP's plan was a foregone conclusion.

"Changes that we're seeing in how resources are being developed, our electricity is being generated, these are going to be huge changes for the state of Wyoming, "said Thor Nelson, Holland & Hart counsel for WIEC. "Wyoming is going to look really different in 10 years from now. And WIEC believes it is important that the commission be as proactive as possible to make sure that you're getting the information you need to get informed decisions."

Addition of renewable resources and retirements under Pacificorp's 2020 IRP preferred portfolio
Credit Pacificorp

  The group argued for substantial new analysis based off what it felt should have been included in Rocky Mountain Power's IRP including a business-as-usual analysis, additional sensitivity analyses, a review of impacts from extreme weather events, and reliability analyses.

Several intervening parties are participating in the hearing to support Rocky Mountain Power's plan including a non-profit renewable energy trade group and environmental organizations.

"We contend the only question before you is whether the IRP meets the requirements of Wyoming law and this commission's normal practice of review of such an IRP," said Shannon Anderson, staff attorney for the Powder River Basin Resource Council, a landowners' group. "The question or deny of the IRP on other grounds as many parties argue, simply has no basis in Wyoming law."

Anderson went on that a rule-making process, as requested by WIEC in it's recommendations, may also be beyond the authority of the PSC.

Intervening parties will have the ability to call witnesses, and cross-examine others' witnesses, throughout the week.

Back in November, PSC's Petrie said there is no predetermined outcome of the investigation other than furthering understanding of the IRP and that the commission is not likely to deter anything.

"While the intention has been to conclude this proceeding this week during the day's scheduled for hearing, this is not a rate-filing or other filing which is required to be concluded within 10-months of a requested effective date," said Petrie. "So, there may be other opportunities to address that and if anyone has suggestions along the way or at any time during this proceeding, I encourage them to bring those forth."

Several took time in their testimony to note the nature of the hearing, including Petrie.

"This is an unusual IRP and an unusual investigation," he said.

For now, the hearing is scheduled to end this Friday and can be viewed online.

EDITORS NOTE: The story was amended to note Pacificorp has six states in its service territory and not the PSC or Public Service Commission.