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PacifiCorp challenges PUC staff in controversial $1.5B wind power bidding process  

Credit:  By Pete Danko, Staff Reporter | Portland Business Journal | Mar 30, 2018 | www.bizjournals.com ~~

PacifiCorp is defending a $1.5 billion wind power solicitation that has come under sharp attack from Oregon Public Utility Commission staff, emphasizing that an independent evaluator that monitored the process endorsed the results as “the best viable options.”

“The independent evaluator is an independent expert appointed and managed by the commission – not PacifiCorp – to ensure that the (request for proposals) process was conducted in a fair and unbiased manner and to ensure that the final shortlist projects are reasonable and consistent with the modeling results used to evaluate bids,” the company wrote in comments filed late Thursday.

Four projects were selected in the RFP for Wyoming wind power, including three that would be owned by PacifiCorp, potentially growing the company’s assets, the basis for its regulated profit as an investor-owned utility.

The RFP, PacifiCorp said, “was a fair, unbiased, and transparent process that included rigorous analysis of net benefits to customers and extensive oversight” by the independent evaluator in Oregon, and another in Utah, where the six-state utility’s plan is also being scrutinized.

Public Utility Commission staff, as well as one losing bidder and a group representing industrial customers, had charged in filings that the process unfairly cut out competitors offering better deals for ratepayers through power purchases from independent suppliers.

They recommended that the PUC withhold acknowledgement of the shortlist in favor of “a more competitive and better-designed RFP,” a delay that could diminish the value of the time-limited federal wind power production tax credit benefits that will flow to customer.

In its reply, PacifiCorp called out that potential loss.

“Such an action would needlessly result in the forfeiture of millions of dollars in PTC benefits for customers,” the company said.

It also highlighted that the independent evaluator “took special care to confirm the selection of PacifiCorp’s (projects) and confirmed the accuracy OF the (projects’) costs and scoring.”

The sharp disagreement came despite the fact that PacifiCorp and the PUC staff based their comments and conclusions on the same independent evaluator report, which was released publicly with redactions.

The independent evaluator did express a number of concerns about what it characterized as a “rushed” process, noting at one point, “The real issue here is that PacifiCorp’s procurement (in the form of this RFP) got out ahead of its resource and transmission planning.”

The staff seized on those concerns, particularly regarding a transmission study introduced well after the bids were all in and that had the effect of dramatically shrinking the pool of viable projects, eliminating much of PacifiCorp’s competition.

But the independent evaluator, PacifiCorp noted, didn’t disagree with its transmission department’s analysis, and agreed that going forward with the projects cut out by the study “would not seem to be the wisest course of action.”

Ultimately, the RFP issues didn’t render the process unfair or call into question the final outcome, the independent evaluator concluded, giving PacifiCorp what it clearly sees as the trump card as it aims to gain acknowledgement of the shortlist, which could come at a public hearing on April 30.

“Staff purports to agree with and rely on many findings in the independent evaluator’s report, yet somehow reaches a conclusion that completely departs from the independent evaluator’s recommendation,” PacifiCorp wrote in its comments.

Source:  By Pete Danko, Staff Reporter | Portland Business Journal | Mar 30, 2018 | www.bizjournals.com

This article is the work of the source indicated. Any opinions expressed in it are not necessarily those of National Wind Watch.

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