CUB Files Brief on PGE Plant Forecast
Posted on August 29, 2007 by oregoncub
Tags, Utility Regulation
There are days when CUB works on issues related to global warming, the future of energy production, or multibillion dollar corporate mergers. And then there are other days, the days when we filter through the minutiae of an annual power cost update tariff, looking for ways to prevent the company from overcharging customers.
Such was our week this week. We filed on Tuesday our Opening Brief in UE 192, regarding PGE’s power cost forecast for its Boardman coal-fired electricity generation plant.
This plant, you may recall, was out of service for approximately 8 months in 2005-2006 due to a cracked rotor on the turbine and the plant operated poorly the rest of those years.
The question in this docket is how many days we forecast the plant to be operational next year. Traditionally, we have looked at the last 4 years of normal operation as a predictor of the next year’s performance. In this case, PGE is proposing that we include significant portions of 2005 and 2006 in that 4-year examination of Boardman operation. A forecast based on those years would predict larger numbers of days off-line for the plant in 2008 than normal, which would require PGE to purchase more power in the market for about 6 cents per kwh (as opposed to the 1.5 cents that Boardman’s power costs), and would therefore result in higher rates for customers. Because PGE negotiates coal and power contracts on the open market, the exact costs at issue here are confidential, but we believe that using the years 2005 and 2006 in creating the Boardman forecast would increase rates by several million dollars in 2008.
CUB is arguing against including 2005 and 2006 in the 4-year average that would set rates for the plant going forward. We think it’s pretty clear that those years were unusual, and, assuming the plant is back to normal operations, as the company claims, shouldn’t be repeated. We are suggesting that the years 2001 through 2004 make a better 4-year average of the plant’s expected operation under normal conditions.
PGE calls CUB’s recommended change in the 4-year average “arbitrary”; we call it just good sense. If you are going to predict for normal operations, you don’t base those predictions on very abnormal circumstances.
We know this is not the most exciting news we’ve ever come to you with. It’s not the most exciting work we’ve ever done either. It’s just the nuts and bolts of good consumer advocacy and utility rate-making. It’s the kind of detail work that customers cannot do and should not have to. It’s why we’re here.
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03/10/17 | 0 Comments | CUB Files Brief on PGE Plant Forecast