On August 13, 2018, the Oregon Public Utility Commission (Oregon Commission) adopted a stipulation outlining an agreed approach to the development of five energy storage projects by Portland General Electric Company (PGE). The Oregon Commission concluded that PGE’s proposed structure for PGE’s Coffee Creek Request for Proposal (RFP) is reasonable; however, the Commission stated that it would require PGE to review ownership issues as part of future filings on the Coffee Creek project.
In 2015, the Oregon Legislature passed HB 2193 requiring Oregon’s electric utilities and the Commission to begin procuring and adopting standards for energy storage. On July 14, 2017, PGE filed its initial application for a Draft Storage Potential Evaluation, which outlined how PGE proposed to use the evaluation to create energy storage project proposals. A stipulation resolving most issues was agreed to by PGE, Commission Staff, the Oregon Citizens’ Utilities Board, the Alliance of Western Energy Consumers, Renewable Northwest, and the Northwest and Intermountain Power Producers Coalition. The stipulation sought approval of five energy storage project proposals as well as support for a storage potential evaluation methodology. Four of the project proposals will be a residential pilot project, a microgrid pilot, the Bladock Pilot (a mid-feeder at an existing solar facility to demonstrate storage integration with solar, and serve to educate the public), and the Port Westward Pilot (an energy storage system at PGE’s Port Westward gas plant).
The fifth pilot project was the Coffee Creek substation will be a large (17-20 MW) energy storage system located at a substation. PGE has over 150 substations, and selected Coffee Creek as the most optimal location for the project. The stipulation requires that the project must have a 17 MW (68 MWh) minimum battery size. The parties agreed that PGE’s decision on the final selected size of the project will be subject to a prudence review, and that PGE must make a demonstration that the location of the project is appropriate before proceeding with its implementation.
The sole disputed issues was the question of third-party ownership of the Coffee Creek energy storage project. PGE proposed that its RFP would be limited to utility-owned and operated responses. NIPPC objected to PGE’s plans to limit this project to utility owned and operated resources, and recommends that the Oregon Commission order PGE to include third-party owned responses as part of the RFP.
The Commission declined to require that PGE expand its Coffee Creek RFP to third-party owned and operated projects. Instead, the Commission required that, in PGE’s analysis justifying the superiority of the Coffee Creek location as opposed to other alternative locations, the company address the feasibility of third-party ownership and operation at alternative locations. The Commission stated that in a future rate proceeding, PGE should justify any decision to exclude third-party bids. The Commission further explained that: “We have consistently encouraged utilities to expand options and offer utility-owned assets or resources to third parties in RFPs. Generally, we consider more bids and more ownership structures and options in the context of an RFP to be better than less, because the likelihood of identifying the lowest-cost, lowest-risk resource is greater in an RFP with a variety of ownership options than a more restricted RFP. Opening this RFP to third-party owned and operated proposals could have concrete benefits, even if such a proposal is not ultimately selected.”
Sanger Law represented the Northwest and Intermountain Power Producers Coalition.
NIPPC represents electricity market participants in the Pacific Northwest, including independent power producers, electricity service suppliers and transmission companies. NIPPC is committed to facilitating cost effective electricity sales, offering consumers choice in their energy supply and advancing fair, competitive power markets.
The Commission’s order can be read Here.
Disclaimer
These materials are intended to as informational and are not to be considered legal advice or legal opinion, nor do they create a lawyer-client relationship. Information included about previous case results does not assure a similar future result.
