ORDER NO. 98-157

ENTERED APR 15 1998

This is an electronic copy.

BEFORE THE PUBLIC UTILITY COMMISSION

OF OREGON

UE 105

In the Matter of the Application of PACIFICORP, dba Pacific Power & Light, to Implement an Experimental Customer Choice Program in Oregon (Advice No. 98-001). ) ORDER

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DISPOSITION: APPLICATION GRANTED

Background. On January 16, 1998, PacifiCorp filed an application and a proposal to implement an experimental customer choice program in Oregon with an effective date of February 25, 1998. The company refiled on February 26, 1998, with an effective date of March 17, 1998. At Staff’s request, on March 11, 1998, PacifiCorp extended the effective date of the tariffs to March 31, 1998. On March 23, 1998, based on discussions with Staff and other stakeholders, PacifiCorp filed a number of replacement sheets and a request to waive statutory notice, with an effective date for the tariff of March 31, 1998.

Portland General Electric, Renewable Northwest Project, Industrial Customers of Northwest Utilities (ICNU), and Pope and Talbot filed petitions to intervene. No objections were filed; the petitions are granted. On March 30, 1998, a special public meeting was convened to consider PacifiCorp’s filing. The Commission reviewed a Staff report recommending that the Commission allow Advice No. 98-001 to go into effect with less than statutory notice and allowing Illinova Energy Partners to provide service to retail customers under PacifiCorp’s program. The Commission heard comments from Staff, Illinova, ICNU, Citizens Utility Board, and Pope and Talbot, as well as Fort James Corporation and Klamath County.

Staff Recommendation. Staff’s report is attached to this order as Appendix A. The report describes PacifiCorp’s proposal and discusses 12 issues that arose in the meetings with PacifiCorp and its stakeholders.

Commission Decision. Commentors at the public meeting spent most time discussing Issue 4, environmental labeling/disclosure; Issue 10, calculation of the energy credit, including the subissue of how to figure the transmission credit; and Issue 11, eligibility for participation in the pilot program. PacifiCorp has made a commitment to meet with Staff by July 1, 1998, to review its pilot program. At that time, many issues raised at the special public meeting will be revisited, including but not limited to the question of hydro impact measurement, part of Issue 4; diurnal loads, load shaping, and the transmission credit, part of Issue 10; and what energy providers and customers are participating in the pilot, relative to Issue 11. A commentor from Klamath County asked whether the lighting provisions of the pilot could apply to counties and cities as well as to schools and universities participating in the Direct Access Program (Schedule 715). That issue too may be considered, if the county petitions PacifiCorp in the matter.

Fort James/Camas is a PacifiCorp customer who would like to participate in the pilot program. Fort James currently receives service from PacifiCorp under a special contract. Fort James argues that it is eligible to participate because it receives service at the same rate as Schedule 48T customers, who are eligible to participate in the pilot. PacifiCorp argues that if Fort James is to participate, the terms of its contract must be renegotiated. The Commission agrees with PacifiCorp that Fort James is not a Schedule 48T customer despite its rate. It is a special contract customer. However, the Commission believes that Fort James should be allowed to participate in the pilot if it is possible to renegotiate the terms of its contract to permit participation. The Commission urges PacifiCorp and Fort James to negotiate a solution to this problem.

The Commission adopted Staff’s recommendation as contained in Appendix A.

ORDER

IT IS ORDERED that:

  1. PacifiCorp Advice No. 98-001, filed February 26 and March 23, 1998, shall go into effect on March 31, 1998.
  2. PacifiCorp’s application to waive statutory notice is granted.
  3. Illinova Energy Partners may provide service to retail customers under PacifiCorp’s Experimental Customer Choice program tariffs.

Made, entered, and effective .

  BY THE COMMISSION:

______________________________

Vikie Bailey-Goggins

Commission Secretary

A party may request rehearing or reconsideration of this order pursuant to ORS 756.561. A request for rehearing or reconsideration must be filed with the Commission within 60 days of the date of service of this order. The request must comply with the requirements in OAR 860-014-0095. A copy of any such request must also be served on each party to the proceeding as provided by OAR 860-013-0070(2). A party may appeal this order to a court pursuant to applicable law.

Appendix A

ITEM NO.____________

PUBLIC UTILITY COMMISSION OF OREGON

STAFF REPORT

PUBLIC MEETING DATE: March 30, 1998

REGULAR AGENDA X CONSENT AGENDA EFFECTIVE DATE: March 31, 1998

DATE: March 23, 1998

TO: Bill Warren through Lee Sparling

FROM: Bonnie Tatom

SUBJECT: PacifiCorp’s Experimental Customer Choice Program (Advice 98-001)

SUMMARY RECOMMENDATION:

Staff recommends the Commission do three things related to PacifiCorp Advice No 98-001:

Allow into effect the tariff sheets contained in PacifiCorp Advice No. 98-001 that were filed at the Commission on February 26 and March 23, 1998.

Approve PacifiCorp’s application to waive statutory notice (L.S.N.), allowing the tariffs to become effective less than 30 days after they were filed at the Commission.

Allow the following energy service provider (ESP) to provide service to retail customers under PacifiCorp’s Experimental Customer Choice Program tariffs: Illinova Energy Partners.

DISCUSSION:

Description of PacifiCorp’s Proposal for an Experimental Customer Choice Program

PacifiCorp believes that its Experimental Customer Choice Program is the first step in the transition to direct access in Oregon. As an advocate of choice for all customers, the company is offering the Customer Choice Program for several reasons:

to respond to stakeholders' desires to provide choices to customers between now and the next legislative session;

to introduce a portfolio model which makes available to small customers a menu of pricing and product offerings, and facilitates development of competitive markets for these customers;

to collect data and information regarding implementation and customer response to help inform the debate regarding comprehensive restructuring legislation;

to begin the customer education process and test ways to educate customers; and

to allow the company to learn more about its role as a distribution company working with ESPs to deliver energy in a competitive world and to help prepare operations, billing, metering and other systems.

The Direct Access program allows customers to contract directly with ESPs for the provision of electricity supply services. PacifiCorp retains responsibility for delivery services, reliability services, and default supplier services. The Direct Access program has three eligible populations: schools located in PacifiCorp’s service territory in Oregon; large commercial and industrial customers in Klamath County; and large customers in the company’s Oregon territory.

The schools program provides direct access to all elementary and secondary schools, colleges, universities and professional schools served by PacifiCorp in Oregon. Both public and private schools can participate. These schools typically fall within SIC Codes 821 and 822. Qualifying rate schedules include General Service Schedule 25 and Schedule 27, Large General Service Schedule 48T, and other schedules. The schools may participate at 100 percent of their load.

Qualifying rate schedules for the large commercial and industrial customers in Klamath County include General Service Schedule 27 and Large General Service Schedule 48T. Klamath County customers may participate at 100 percent of their load.

A customer using more than 5 megawatts (peak) at a single site in PacifiCorp’s Oregon territory may participate in direct access. Also, all current Oregon Schedule 48T and Schedule 27 customers under the same corporate ownership able to add their maximum demand to 5 peak megawatts may participate in direct access. Each Schedule 27 customer included in the program will be individually billed on Schedule 748; the Basic Charge will be based on a minimum load of 1 megawatt. Customers may participate at 50 percent of their total load. The load profile of each customer’s participating load must be equivalent to the load profile of the customer’s total load.

The Portfolio Access program allows customers to choose from a portfolio of pricing options. PacifiCorp has designed the portfolio with certain options opened to offers by ESPs. All residential and small commercial customers served by PacifiCorp in Klamath Falls and surrounding communities in Klamath County may participate in portfolio access. Qualifying rate schedules include Residential Service Schedule 4, General Service Schedule 25, and Agricultural Pumping Service Schedule 41. PacifiCorp serves approximately 30,000 customers in this area with the vast majority eligible for Portfolio Access. Customers will participate at 100 percent of their load.

Pricing in the Experimental Customer Choice Program is based on the existing standard tariff price. Under the company’s proposal, a number of credits will be used to determine the price the customers actually see. The bills for participants will be reduced by a Direct Access or Portfolio Access Credit, to account for the cost of energy that will no longer be purchased for them by Pacific Power. This price reduction is based on an average electric commodity on-peak price of 19.81 mills/kWh at the California-Oregon border (COB, a published wholesale energy price indicator) over 12 months ending in March 1998. Direct Access customers may choose either a Fixed Direct Access Credit or a Quarterly Direct Access Credit shaped by seasonal changes in market prices. Portfolio Access customers receive a six-month credit for each subscription period. To continue incentives for the development and use of renewable and alternative energy sources, PacifiCorp’s Experimental Customer Choice program includes an Environmentally-Preferred Power Credit. This credit of 0.2 cents/kWh will be available to customers who choose to purchase energy from qualifying resources such as solar, wind, landfill gas and biomass. For the experimental program, this credit will be funded by the company’s shareholders. Customers who decide to participate in the Direct Access program may also receive the following credits not relevant for Portfolio Access:

Transmission and Ancillary Services expenses will be deducted from participating customers’ bills, as these services will be charged by PacifiCorp to the new energy service provider. The charge is based on transmission tariffs on file with the Federal Energy Regulatory Commission. The resulting credit on bills of participating customers is $1.55/kW for demand-metered customers and 0.436 cents/kWh for non-demand metered customers. Customers who decide to have their entire electric bill handled by a new energy provider offering the service will receive an additional credit of $0.29 per month from PacifiCorp. This Billing Credit represents the incremental cost PacifiCorp incurs each month in preparing an individual customer bill. The participating Direct Access customer will also be charged for the energy commodity purchased from its selected new energy supplier. The participating Portfolio Access customer will also be charged for the portfolio option selected. If the cost for this power is less than it would have been through PacifiCorp’s standard tariff, the customer will save money.

With the exception of the schools direct access program, the expiration date of the Experimental Customer Choice Program is June 30, 1999. In order to coincide more closely with the timing of school years, the schools program expires on August 31, 1999.

Procedural Background

On October 7, 1997, PacifiCorp announced its intention to offer an Experimental Customer Choice Program in the State of Oregon. Since that time, the company has convened numerous stakeholder meetings and technical workshops to solicit feedback and assistance in designing the program.

On November 6, 1997, the company held a stakeholder meeting, and distributed draft tariffs and rules to interested parties. The company then convened a meeting for ESPs, a meeting with Klamath County citizens, a meeting with Klamath County Commissioners, and technical workshops on Scheduling/Balancing, Labeling, and the Environmentally-Preferred Power Credit. On December 10, 1997, the company distributed another draft of the Experimental Customer Choice Program tariffs and rules. Input on these draft tariffs was received at a second stakeholder meeting, held on December 17, 1997, and through written comments.

On January 16, 1998, PacifiCorp filed Advice No. 98-001 requesting implementation of the company’s Experimental Customer Choice Program, with an effective date of February 25, 1998. The company subsequently refiled on February 26, 1998, with an effective date of March 17, 1998. Staff reviewed the tariffs and participated in a public meeting, an issues workshop, and settlement meetings with the company and a variety of parties. Staff also considered written comments from eight parties, and attended a public meeting in Klamath Falls to hear comments from interested Klamath County customers.

On March 11, 1998, at staff’s request, the company again extended the effective date of the tariffs--to March 31, 1998. On March 23, 1998, based on additional discussions with staff and other stakeholders, PacifiCorp filed numerous replacement sheets, along with an L.S.N., with an effective date of March 31, 1998.

Experimental Customer Choice Program Issues

Issue 1: Inclusion of PacifiCorp’s portfolio offers (and those of participating ESPs) on Schedule 799

The portfolio offers from PacifiCorp as well as portfolio offers from participating ESPs should be listed on Schedule 799 -- most easily by including a copy of the final portfolio ballot within Schedule 799. As a practical matter, staff is not suggesting that the Commission "approve" the portfolio price offers after an extensive review (as would occur in a rate case). Instead, staff believes that the entire portfolio option is, effectively, a PacifiCorp offer to some of its retail franchise customers in Klamath County and should be listed on the company’s tariff. The company agrees, and will submit a revision to Schedule 799 later this spring with the portfolio price offers.

Some parties suggested the need for a screening process to reduce the number of ESP offers in order to keep the ballot simple and understandable. Staff does not believe the company needs to have a screening process in place before the pilot is allowed to go into effect. However, if the number of portfolio offers is large enough to make the ballot overly complex and reduce customer participation, then a screening process could be developed for use during a second subscription period implemented six months after the first subscription period.

Issue 2: Certification of Portfolio Access providers

PacifiCorp proposed that an ESP offering service through the portfolio would not need to be certified because it would merely be engaged in a wholesale transaction with the company. Staff did not agree. If the company’s desire is to include the ESP’s offer on the ballot for customers to review, it seems appropriate to have the Commission proceed with its review of these potential ESPs in the same manner as it would for those ESPs requesting to sell electricity to customers participating in the direct access portion of the pilot. PacifiCorp’s revised Rule 20, filed March 23, 1998, adopted staff’s position.

Issue 3: Environmentally-Preferred Power Credit

PacifiCorp first proposed a Renewable Resources Credit in its draft filing in late 1997. In the ensuing three months, environmental advocates, OOE, staff and the company have held numerous technical meetings to discuss the credit and under what conditions it should be made available to customers. The company has made several revisions to the tariff consistent with this group’s recommendations: (1) portfolio access customers are eligible for the credit, as well as direct access customers, (2) the threshold share of eligible resources has been increased from 10% to 20%; and (3) the definition of the eligible resources has been revised to eliminate small hydropower and municipal solid wastes. In addition, the credit has been renamed more aptly as an Environmentally-Preferred Power Credit.

Issue 4: Environmental labeling/disclosure

PacifiCorp has met with its technical working group on labeling and renewables throughout this process and has made significant revisions to its initial draft. PacifiCorp included the following provisions in its final tariff: labeling includes more detailed reporting of environmental effects for all resource types and a modified NWPP fuel mix will be used for the default. The tariff also requires disclosure of the following: emissions from sulfur dioxides, nitrogen oxides, carbon dioxide, and production of high-level radioactive wastes, and a hydropower impact rating. In addition, the tariff requires environmental reporting for all ESPs whose bids appear on the ballot under the portfolio access approach. Environmental disclosure must be made at the time of a direct access or portfolio offer to provide service, or upon customer request, and no less than on a quarterly basis after enrolling a customer. Finally, PacifiCorp must disclose environmental information for its own power supply to all customers in its Klamath County service area who are eligible for the pilot on at least a quarterly basis.

The Oregon Office of Energy (OOE), in comments filed March 4, 1998, supported the company’s development and inclusion of a measure for impacts on anadromous fish (salmon and steelhead) from hydropower in the environmental disclosure aspects of the pilot. OOE, however, provided a number of suggestions for wording changes related to Rule 19 and Rule 20 sections on environmental disclosure. OOE’s suggestions included: clarifications of terms used by the company and others to define net system power fuel mix, environmental effects, and electricity product; delegation to OOE to provide and update the environmental information for consistency; and provision of disclosure information to customers. The company supported these changes, and with the revised filing on March 23, 1998, adopted OOE’s language.

The Green Power Workgroup (GPW), which includes members from the Northwest Energy Coalition, Northwest Environmental Advocates, American Rivers, Renewable Northwest Project and other noted environmental organizations, has been working with the technical working group on environmental disclosure for PacifiCorp’s experimental program. GPW put together suggestions for the description of green power to be used on Schedule 799, Portfolio Price Options. PacifiCorp adopted these suggestions in its filing of February 26, 1998. Subsequently, OOE offered language modifications which, for the most part, were agreed to by GPW. PacifiCorp’s revised filing of March 23, 1998, includes the language agreed to by GPW, OOE and other parties on the technical working group.

Finally, the technical working group discussed extensively the appropriateness of PacifiCorp’s proposed hydro measurement. The hydro measurement will look at projects that were licensed or relicensed since 1986 (this date reflects passage of the Electric Consumers Protection Act, which required a balance of fish, wildlife and recreational concerns in relicensing). The number shown in the measurement will reflect the percent of annual energy output that comes from a project that has been relicensed since 1986. Projects that are not subject to ECPA, e.g., BC Hydro, would use the NWPP regional average as the default for hydro impact. The parties agree that this is a preliminary measurement. The technical working group will continue to meet throughout PacifiCorp’s pilot to develop a more comprehensive set of criteria. Staff, along with OOE, will continue to be involved in these discussions.

Issue 5: Subscription process

Staff believes Pacific’s portfolio access pilot should allow more switching between portfolio options than the company originally proposed. Requiring commitments to a single portfolio option for a lengthy time period may inhibit small customer participation and limit experimentation with different options. Pacific’s revised proposal to allow portfolio participants in the first subscription period to switch options in the second subscription period (after six months) is an improvement over its original one-year option requirement. Pacific has agreed to assess this condition in its pilot evaluation. Staff also has concerns that the 30-day subscription period may be too short to attract much small customer participation in the pilot. Pacific believes the short subscription period is necessary to encourage ESP participation in the portfolio pilot, because it reduces supply-contracting risk. The company also believes the 30-day subscription period will encourage customers to return their subscription ballots quickly before they forget about them. Rather than modifying the length of the first subscription period, Pacific agreed to staff’s proposal to conduct an independent customer survey immediately after the first enrollment period has ended if the process results in minimal customer participation (less than 2,000 participants). The survey will assess whether the short subscription period or any other part of the pilot subscription process (e.g., inability to switch among portfolio options, lack of sufficient customer education) was the cause of low participation in the pilot. Recommendations, if any, resulting from the assessment will be used to improve the second subscription process.

OOE provided suggestions for improving the tariff language with regard to the subscription process. For example, OOE suggested that the terms and conditions of traditional utility bundled service, as well as the terms and conditions of ESP offers, should be on the ballot. OOE also proposed that the Commission approve, rather than merely review, the ballot prior to mailing to customers to ensure that the ballot is fair, unbiased, accurate, and to the extent possible, uniform. Finally, OOE proposed language clarifying that the terms and conditions set forth by an ESP in the second subscription period would be applicable to a customer who selected that ESP’s portfolio option in the first subscription period, but failed to return a portfolio ballet in the second subscription period. Staff agrees with the suggestions provided by OOE. The company’s revised filing, dated March 23, 1998, incorporated those suggestions.

Issue 6: Assessment of PacifiCorp’s pilot programs

Staff believes that evaluation of pilot programs should be thorough and objective to provide policy makers with the most useful information possible. In order to accommodate this goal, Pacific agreed to use independent consultants to complete the evaluation work and to establish a Pilot Evaluation Team to determine evaluation goals and objectives and to provide feedback on all aspects of the pilot assessment. In November 1997, Pacific initiated the evaluation team, which includes representatives from the Citizens’ Utility Board, Northwest Power Planning Council, Office of Energy, PacifiCorp, and OPUC. The research plan for evaluating Pacific’s pilot was recently finalized by the group. A complete technical report on the results of Pacific’s pilot programs through the fall of 1998 will be provided to the Commission by December 1, 1998, so that interested parties may review the results prior to the 1999 legislative session. Staff believes Pacific’s plans for evaluating its pilot programs are reasonable.

Issue 7: Standard of conduct

PacifiCorp’s original filing did not include in the body of the tariff standard of conduct language (specifying equal treatment of ESPs, whether affiliated with PacifiCorp or not). Staff suggested several other language changes to make the standard of conduct language more consistent with PGE’s Introductory Customer Choice Program tariff. Staff is satisfied that the revised Standard of Conduct (Section XIII, Rule 19) contained in the tariff submitted March 23, 1998, includes the appropriate modifications.

Issue 8: Education/Communication Plan

Staff believes that PacifiCorp’s education plan will continue to evolve as the pilot progresses. We are concerned that the portfolio access approach in particular may be difficult for many customers to understand. An adequate education plan and appropriate communication materials are paramount to the success of PacifiCorp’s Direct Access and Portfolio Access programs. PacifiCorp has revised its plan, at staff’s request, to include specific activities and dates that these activities are slated to be accomplished in order to inform the eligible customers in its pilot. In addition, the company has indicated in its filing that all communication materials to be disseminated by the company that pertain to electric restructuring in Oregon and these pilots will be forwarded to staff in draft form for review.

Issue 9: Franchise Fees

PacifiCorp’s original filing of January 16, 1998, contained a Schedule 796 that discussed the calculation of franchise fees to be used in the experimental programs. After much discussion with staff and interested parties, the company decided to withdraw this schedule and simply calculate the franchise fee prior to any appropriate credits for the direct access and portfolio access programs. PacifiCorp states that an approach like this is needed to keep the cities whole with respect to the franchise fees they collect and to remove any incentive for a customer to switch to direct access merely to escape a portion of its franchise fee. Staff agrees that PacifiCorp’s franchise fee approach should be adopted and is not aware of any opposition from other parties.

Issue 10: Calculation of the Energy Credit

The calculation of the direct access energy credit has been the source of numerous discussions among the stakeholders in this pilot process. The company originally proposed an 18.82 mill credit related to a 12-month average of historical on-peak COB prices. The company’s calculation was found to be flawed, but upon re-evaluating the credit for discussion at staff’s settlement meeting on February 18, 1998, the company found that the proposed credit was actually higher than would be calculated by adjusting the NYMEX futures price at COB to include off-peak periods. On March 23, 1998, PacifiCorp revised the direct access credit by raising the credit to 19.81 mills, based on updated COB prices, thereby reducing the price seen by customers participating in the direct access pilot. For customers who want the ability to return to standard tariff service during the Experimental Customer Choice Program, the company has included a Quarterly Direct Access Credit. This is based on the value of the fixed credit shaped for seasonal differences in power markets.

ICNU and other parties argue that PacifiCorp’s proposed distribution charges are too high, for three reasons. First, the energy credit is still too low, based on ESP offers for service under Schedule 748 and projected market prices for the California Power Exchange. Second, PacifiCorp (unlike PGE) requires the ESP and customer to forecast hourly loads but there is no compensation for it. Third, the credit for transmission and ancillary services (which will be paid by the ESP under PacifiCorp’s FERC tariff instead of by the customer through retail rates) is too low, because it is based on the company’s estimate of the rate for network service, not the point-to-point service likely to be used by ESPs. For an 80 percent load factor customer, the difference between the point-to-point rate and the proposed credit is just under 1 mill per kWh. PacifiCorp has stated that it intends the credit for transmission and ancillary service to offset the ESP’s costs for those services and that it will adjust its FERC tariff and the direct access tariffs as needed to meet that goal. Since the proposed energy credit exceeds the NYMEX futures price (adjusted to include off-peak hours) and the corresponding credit in PGE’s pilot, staff recommends that PacifiCorp’s proposed rates be allowed to go into effect. If participation in the direct access programs is low, then the company should attempt to determine the reasons and make any appropriate adjustments in the tariffs.

Issue 11: Eligibility for Schedule 748

Schedule 748 is the direct access tariff for large customers throughout PacifiCorp’s Oregon service territory. Under the company’s proposal, customers with loads exceeding 5 MW at one or more sites are eligible to purchase under Schedule 748 for up to 50 percent of their load. ICNU and others argue that all customers now served under Schedule 48T (1 MW minimum load) should be able to participate and that 100 percent of a qualifying customer’s load should be eligible for direct access. Staff believes that the best yardstick for deciding whether PacifiCorp’s proposal is reasonable is PGE’s direct access pilot. PacifiCorp’s 5 MW threshold and 50 percent load participation are the same as PGE’s and should be adopted.

Special contract customers served entirely at Schedule 48T prices would be eligible for direct access, except for Fort James’ Camas mill. Fort James wants direct access for Camas, but PacifiCorp argues that allowing it to participate would require renegotiation of other terms of the special contract, specifically with respect to steam royalty payments. The two parties are still discussing possible resolution of the dispute, and staff will address the issue if and when it is brought to the Commission.

Issue 12: Tracking of Costs

PacifiCorp intends to make its own offers to customers through the portfolio. (The company has stated, however, that if it offers power in the Direct Access program, it will do so through an affiliate.) At staff’s request, PacifiCorp added language to Rule 20 (rules and regulations for portfolio access) that it will track costs, revenues, prices, sales, and other information pertaining to its participation in order to allow the Commission to assess ratemaking issues. This same language was adopted in PGE’s pilot to apply to PacifiCorp and other Oregon investor-owned utilities participating as utilities.

Other Issues:

Interested stakeholders in PacifiCorp’s pilot process raised a number of other issues. Staff has reviewed these issues, as well. PacifiCorp proposed modifications to its tariff consistent with the suggestions of these commenters. For example, in responding to Legacy Health Systems, the company has renamed its "annual" direct access credit as a "fixed" direct access credit to allay any confusion about the use of the term annual, when the direct access credit is proposed to be in effect for at least 12 months.

Certification

Staff’s public meeting memo of September 23, 1997 [in PGE Advice 97-13] set out the policy objectives staff used and will continue to use to achieve the goal of testing customer choice through pilot programs. The sixth objective is that "certification of electricity suppliers should be rigorous to ensure consumer protection."

PacifiCorp’s tariff (in Rules 19 and 20) discusses the requirements for certification of Energy Service Providers (ESPs). Certification generally consists of the following steps:

  1. An ESP applicant completes an application and forwards it to PacifiCorp.
  2. The application is reviewed by PacifiCorp, with the company having the responsibility for getting all the necessary information. The application process includes obtaining approval to do business in Oregon, establishing creditworthiness, completing a service agreement, and agreeing to a number of terms and conditions set forth in the tariff (e.g., agreeing that the certification process includes a review by the Commission of the application to the company for adherence to the company’s tariff). The company then notifies the ESP applicant that the tariff conditions have been met and forwards, by letter, a list of those ESP applicants to the Commission, along with supporting information.
  3. The Commission reviews the company’s letter and verifies that the ESPs listed meet the eligibility requirements of the company’s tariff.
  4. At a public meeting, the ESP applicant is either accepted or denied. If the ESP applicant is accepted, the ESP shall then be certified to sell electricity to customers under the company’s Experimental Customer Choice Program.

PacifiCorp notified one ESPs applicant that it met the criteria for ESP certification, and by letter dated March 20, 1998, submitted the following list of ESPs for Commission certification:

Illinova Energy Partners

Staff has reviewed the documentation submitted by PacifiCorp and confirms that the following ESP applicant can be certified to participate in the Experimental Customer Choice Program: Illinova Energy Partners. Commission certification would allow this entity to sell energy services to customers under the company’s Experimental Customer Choice Program, effective March 31, 1998 for deliveries to Schedule 748 customers; April 15, 1998 for deliveries to customers under Schedules 705, 715, 723, 727, 728, and 754; and July 1, 1998, for deliveries to customers requesting service under Schedules 704, 725, and 741. The Commission can decertify any ESP for reasons stated in PacifiCorp’s tariff and listed in Rules 19 and 20. PacifiCorp’s pilot also requires that ESPs be re-certified annually to continue to provide service under PacifiCorp’s direct access and portfolio access experimental tariffs.

STAFF RECOMMENDATION:

Staff recommends the Commission allow into effect the tariffs contained in PacifiCorp Advice No. 98-001 that were filed at the Commission on February 26 and March 23, 1998. Staff also recommends the Commission approve the company’s L.S.N. Finally, staff recommends the Commission allow the following ESP to provide service to PacifiCorp retail customers under PacifiCorp’s direct access and portfolio access pilot tariffs: Illinova Energy Partners.