Oregon Commission Adopts Guidelines and Requirements for Energy Storage Procurement

In the final days of 2016, the Oregon Public Utility Commission (Commission) issued an order implementing House Bill 2192 (HB 2193) and setting the stage for energy storage in Oregon. The Commission’s order adopts: 1) guidelines for utilities to submit proposals for authorization to develop storage projects; 2) requirements for evaluating a utility’s system-wide storage potential; and 3) minimum competitive bidding requirements for energy storage procurement.  

In 2015 the Oregon Legislature passed HB 2193 requiring Oregon’s electric utilities to begin acquiring energy storage, and the Commission to adopt energy storage standards. Oregon is following California’s lead, which enacted the nation’s first storage mandate back in 2013. Oregon’s bill requires PacifiCorp and Portland General Electric to each procure a minimum of 5 MWh of energy storage before 2020, and limits the amount of storage each utility can procure to 1% of its 2014 peak load, unless the utilities work together, share costs, and obtain a waiver from the Commission.

HB 2193 requires the utilities to submit a proposal to the Commission before 2018 for developing an energy storage project. The Commission has encouraged the utilities to propose multiple energy storage projects with an aggregate capacity close to the statutory cap. If the Commission authorizes any projects, and the utilities procure them before 2020, HB 2193 authorizes full recovery in rates of all costs prudently incurred, including any above-market costs.

The Commission had a busy year implementing HB 2193, and that work is far from over. Aside from the current guidelines, the Commission has also been directed by HB 2193 to: 1) develop a methodology to value energy storage that includes a lengthy, non-exhaustive, list of statutory factors; 2) consider how storage might complement other technology solutions; and 3) c0nsider ways in which the Commission might encourage electric companies to invest in different types of systems. Finally, the Commission has indicated that additional competitive bidding guidelines for storage may become necessary in the future.




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