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04/09/2021 Portland Update


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Rate Case Parties, Including NRU, Advance Settlement Proposals Pursuant to direction from the NRU Board during Tuesday’s rate case webinar, on Wednesday NRU joined with nearly all public power parties in the BP-22 rate case to advance a “narrow settlement” in the proceeding. This narrow settlement proposal would have Bonneville collect $40m in revenue financing per year for each year of the BP-22 rate period. The proposal requires this money to be used for liquidity before revenue financing if BPA’s financial condition would otherwise reduce liquidity, and would have Bonneville conduct a robust process, with meaningful customer input, to determine a comprehensive revenue financing policy to guide Bonneville in the future. The $40m per year amount is significantly less than the $95m per year that Bonneville proposed at the start of the rate case and would mean at least a 2.5% rate reduction for each NRU member compared to Bonneville’s initial proposal.

Other parties also expressed interest in settling all or part of the BP-22 case, and PNGC has joined with others to advance what they term a “comprehensive settlement” proposal.

Bonneville has scheduled a public meeting on Wednesday, April 14 to discuss public power’s narrow settlement proposal along with other ideas. NRU staff will attend this meeting to closely track activity around settlement discussions. In the meantime, NRU staff is working on drafting TC-22 and BP-22 briefs. We will adjust our messaging and priorities in these briefs in response to iterations in the settlement discussions while maintaining consistency with policy direction from the NRU Board. Please feel free to contact Zabyn at 503-351-0485 or ztowner@nru-nw.com if you have any questions about rate case settlement or briefing. NRU Submits Comments to BPA Re: Post-2028 Initial Thoughts Consistent with the guidance of NRU’s Post-2028 Working Group and as proposed in last week’s Portland Update, NRU submitted comments in response to the materials BPA staff shared during the March 18th Rates and Contracts meeting. Our comments are attached and summarized below:

  • Emphasized the importance of BPA providing low carbon, affordable and reliable power and transmission to its preference customers.

  • Noted that NRU will use its adopted principles and policy positions to guide post-2028 conversations and reattached them for ease of reference.

  • Observed the four foundational tenets are generally in line with our principles and policy positions and urged BPA and customers to begin diving more into the details of exploring different methodologies and approaches for post-2028, such as how to set the Tier 1 system size.

  • Questioned whether the Regional Dialogue objectives of lowest Tier 1 rates and certainty/stability were met, given BPA’s collection of additional revenues to support its financial health objectives, which fall outside the terms of the TRM.

  • Stressed NRU’s willingness to work collaboratively with BPA and other customers to develop a post-2028 construct that is mutually beneficial and meets our principles and policy positions.

Columbia River Treaty Power Group (CRTPG) Begins Virtual “Spring Fly In” This week, the CRTPG began a virtual spring fly in with the goal of meeting with every member of the Northwest delegation to communicate the CRTPG’s desire for the delegation to engage the Biden Administration and urge it to issue notice of termination to the Canadians. Ten rounds of negotiations without measurable progress have made it clear the Canadians will only be motivated to come to the table for substantive negotiations if the notice is issued. Members of the CRTPG, and some NRU members who responded to my call for volunteers, met with staff from 13 members of the Northwest delegation in this week alone. Before going further, I would like to extend my appreciation to NRU members Tom McBartlett, Ryan Redmond, and Brandon Hignite for carving time out of their busy schedules to attend these meetings and support efforts to modernize the treaty! Meetings were held with staffers from the following offices:


Responses from staffers were generally positive and ranged from questions regarding the impact of terminating the power provisions on other aspects of the treaty to commitments to push this matter forward. These reactions were anticipated and one of the primary takeaways of this virtual fly in will be an assessment of where we stand with the delegation on termination versus negotiation and what work remains to cross the finish line on getting the Biden administration to issue the notice of termination. The virtual fly in will continue for at least the next week as we strive to meet with the other half of the Northwest delegation as quickly as possible. Please contact me directly at 509-993-4088 if you would like to participate or have any other questions or comments. NRU to Comment on BPA Transmission’s Most Recent Business Practice BPA held a conference call this week to review a draft transmission business practice that is intended to allow Point-to-Point (PTP) customers to consolidate multiple transmission reservations into a single one. While this appears to be fairly benign, we are concerned it opens up opportunities for gaming. In other words, a PTP customer who needs 50 MWs of transmission that would not be granted due to insufficient capacity could submit fifty separate 1 MW requests that could be individually granted based on a de minimis impact ruling. We are also concerned that this option is not being made available to NT customers, though this may be driven by the rules established by the North American Electric Standards Board. It’s also worth noting that BPA has delayed the issuance of the NT business practice until May 17, which was originally scheduled to come out last week. As you’ll recall from prior Portland Updates, NRU in coordination with several other NT customers, submitted a significant number of questions and requested modifications to the draft business practice that was initially released in January. This significant delay is likely indicative of the amount of work that BPA had to put into redrafting the original release in response to our comments. We are looking forward to seeing what changes BPA will make and will communicate the key points to the NRU membership in late May. Washington Senate Passes Cap-and-Trade Legislation On Thursday evening, the Washington State Senate passed an economy-wide cap-and-trade bill with a 25-24 vote. The bill now moves to the state House of Representatives for consideration. Although the Washington House is generally considered more progressive than the Washington Senate, passage in the House is far from certain. There are less than three weeks left in the legislative session, and legislators have expressed several concerns about the bill as passed in the Senate. NRU is continuing to track this legislation, paying particular attention to how it would integrate with CETA requirements and affect NRU’s Washington members.

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