The Idaho Public Utilities Commission has authorized Idaho Power Company to develop new rate and service schedules for residential and small general service customers with on-site generation. The ruling does not change rates, rate design, or the current compensation credit structure for on-site generation customers but only changes how these customers are classified for purposes of the requisite analysis to be conducted in a company-specific on-site generation docket. In giving guidance to Idaho power in developing new tariffs the commission found the ability of on-site generation customers have to “net out” their electricity use causes them to underpay their share of the company’s fixed costs to serve customers, and this inequity will only increase as more customers choose on-site generation. The present netting of energy not only allows these customers to avoid paying their fair share of fixed costs, but also prevents them from realizing presently un-quantified benefits to the grid, the commission said. It concluded that separating on-site generation customers from standard customers under the utility’s tariff structure will help the commission and stakeholders analyze subsidization, fixed costs, cost to serve, rates, rate design, and benefits and compensation for exports. The commission also said that “benefits that on-site generation provide to the company’s infrastructure and resource allocation, once quantified, may well prove to outpace any alleged costs, increases in fixed-cost responsibility or decreases in net excess energy compensation credit.” Re Idaho Power Co., Case No. IPC-E-17-13, Order No. 34046, May 9, 2018 (Idaho P.U.C.).
Net Metering Tariffs
Idaho Public Utilities Commission issues guidance for net metering tariff updates with a focus on cross-subsidization and future system benefits.