Oregon Standard Offer Rates

In recognition that renewable energy supplies continue to rise while demand and consumption remain more stable, the Oregon Public Utility Commission provided Portland General Electric Company with interim rate relief, by modifying the company's obligations under the Public Utility Regulatory Policies Act as they relate to power purchase agreements (PPAs) with solar qualifying facilities (QFs).

Among the changes made by the commission was a reduction in the eligibility cap for avoided-cost prices in standard offer contracts. That cap was lowered to three megawatts for solar QFs effective July 14, 2017.

The commission deemed the changes consistent with others it had recently authorized for standard offer rates administered by two other utilities, Idaho Power Company and Pacifi- Corp. In each case, the commission said, it had determined that the subject utility was experiencing unprecedented growth in the number of applications and expressions of interest in PPAs by solar QF developers.

The commission conceded that failing to approve similar QF pricing changes for all utilities could encourage developers to engage in geographic arbitrage. The commission added that even though many of the proposed QF projects may not come to fruition or become operational, interim relief for the utilities was necessary so as to assure ratepayers are protected from the potentially significant cost impacts resulting from long-term PPAs whose prices exceed the utility's actual avoided costs. (UM 1854)