OAR 345-023-0020: Least-Cost Plan Rule

(1) The Council shall find that the applicant has demonstrated need for the facility if the capacity of the proposed facility or a facility substantially similar to the proposed facility, as defined by OAR 345-001-0010, is identified for acquisition in the short-term plan of action of an energy resource plan or combination of plans adopted, approved or acknowledged by a municipal utility, people's utility district, electrical cooperative, other governmental body that makes or implements energy policy, or electric transmission system operator that has a governance that is independent of owners and users of the system and if the energy resource plan or combination of plans: (a) Includes a range of forecasts of firm energy and capacity demands and committed firm energy and capacity resources, as defined in OAR 345-001-0010, over the planning period using a reasonable method of forecasting; (b) Considers and evaluates a reasonable range of practicable demand and supply resource alternatives over the planning period on a consistent and comparable basis. Practicable alternatives are those that are demonstrated to be technically and economically achievable within the time frame considered to meet potential energy or capacity needs; (c) Uses financial assumptions, including discount rates and treatment of resource lifetimes and end effects that are consistent and comparable between resources; (d) For electric transmission line facilities, considers alternatives that include but are not limited to: (A) Implementation of cost-effective conservation, peak load management and voluntary customer interruption as a substitute for the proposed facility; (B) Construction and operation of electric generating facilities as a substitute for the proposed facility; (C) Direct use of natural gas, solar or geothermal resources at retail loads as a substitute for use of electricity transmitted by the proposed facility; and (D) Adding standard sized smaller or larger transmission line capacity; (e) For natural gas pipeline facilities, considers alternatives that include but are not limited to: (A) Implementation of cost-effective conservation, peak load management and voluntary customer interruption as a substitute for the proposed facility; (B) Installation of propane storage systems, facilities to store liquefied natural gas and underground gas storage reservoirs as a substitute for the proposed facility; (C) Direct use of electricity, solar or geothermal resources at retail loads as a substitute for use of natural gas supplied by the proposed facility; and (D) Adding standard sized smaller or larger pipeline capacity; (f) For storage facilities for liquefied natural gas, considers alternatives that include, but are not limited, to: (A) Implementation of cost-effective conservation, peak load management and voluntary customer interruption as a substitute for the proposed facility; (B) Installation of propane storage systems, natural gas pipelines and underground gas storage facilities as a substitute for the proposed facility; (C) Direct use of electricity, solar or geothermal resources at retail loads as a substitute for use of natural gas supplied by the proposed facility; and (D) Adding smaller or larger liquefied natural gas storage capacity; (g) Includes the development and evaluation of alternative resource plans to meet forecast energy or capacity needs over the planning time period; (h) Analyzes the uncertainties associated with alternative resource plans or strategies. The range of uncertainties about the future must be sufficient to test the performance of each alternative resource strategy. The criteria used to evaluate performance of alternative resource strategies must be broad enough to judge the merits of a strategy from a societal perspective; (i) Aims to minimize long-run total resource costs while taking into account reliability, compatibility with the energy system, strategic flexibility, as defined in OAR 345-001-0010, and external environmental costs and benefits. The value provided by reliability, compatibility with the energy system, strategic flexibility and external environmental costs and benefits may justify actions that increase the total resource cost of the plan. The Council finds that the goals of a least-cost plan are to minimize expected total resource costs for society and the variance in those costs due to uncertainty about future conditions; (j) Includes a short-term plan of action; (k) Is consistent with the energy policy of the state as set forth in ORS 469.010. An energy resource plan is consistent with the energy policy of the state if its short-term plan of action describes actions that must be taken within a two to three year time frame to provide a reasonable assurance that future energy or capacity demands can be met while aiming to minimize total resource cost; and (L) Was adopted, approved or acknowledged after a full, fair and open public participation and comment process. Such a process is one in which the public has reasonable and timely access to the decision-maker and to information and records legally available to the public. (2) The Council shall find that a least-cost plan meets the criteria of an energy resource plan described in section (1) if the Public Utility Commission of Oregon has acknowledged the least cost plan. (3) If the applicant chooses to demonstrate need for the proposed facility under OAR 345-023-0020(1), the least-cost plan rule, they must submit the following additional information in their application: (a) Identification of the energy resource plan or combination of plans on which the applicant relies to demonstrate need; (b) The name, address and telephone number of the person responsible for preparing each energy resource plan identified in subsection (a); (c) For each plan reviewed by a regulatory agency, the agency's findings and final decision, including: (A) For a plan reviewed by the Oregon Public Utility Commission, the acknowledgment order; or (B) For a plan reviewed by any other regulatory agency, a summary of the public process including evidence to support a finding by the Council that the agency’s decision process included a full, fair and open public participation and comment process as required by OAR 345-023-0020(1)(L), and the location of and means by which the Department can obtain a complete copy of the public record; (d) Identification of the sections of the short-term action plan that call for the acquisition of the proposed facility or, as defined in OAR 345-001-0010, a facility substantially similar to the proposed facility; (e) The attributes of the proposed facility that qualify it as one called for in the short-term action plan of the energy resource plan or combination of plans identified in subparagraph (i) or a demonstration that, as defined in OAR 345-001-0010, a facility substantially similar to the proposed facility is called for in the plan. (4) If the applicant chooses to demonstrate need for the proposed facility under OAR 345-023-0020(1), the least-cost plan rule, and relies on an energy resource plan not acknowledged by the Public Utility Commission of Oregon, they must submit the following additional information: (a) The names, addresses and telephone numbers of members of any public advisory groups that participated in the preparation and review of each plan identified in (3)(c); (b) A discussion of how the plan or combination of plans conforms to the standards in OAR 345-023-0020(1)(a) through (L) including citations to relevant portions of the plan documents or other supporting evidence; (c) The expected annual emissions in tons of nitrogen oxides, PM-10 particulate, sulfur dioxide, carbon dioxide and mercury and a discussion of other environmental impacts, as compared to resources in the applicable energy resource plan; (d) In addition to the information described in (b) and (c), if the applicant chooses to demonstrate need for a proposed natural gas pipeline or storage facility for liquefied natural gas under OAR 345-023-0020(1), the least-cost plan rule, and relies on an energy resource plan not acknowledged by the Public Utility Commission of Oregon, the applicant must include the information described in OAR 345-023-0040(3) if the energy resource plan or combination of plans does not contain that information. If the energy resource plan or combination of plans contains the information described in OAR 345-023-0040(3), the applicant must provide a list of citations to the sections of the energy resource plan that contain the information; (e) In addition to the information described in (b) and (c), if the applicant chooses to demonstrate need for a proposed electric transmission line under OAR 345-023-0020(1), the least-cost plan rule and relies on an energy resource plan not acknowledged by the Public Utility Commission of Oregon, the applicant must include the information described in OAR 345-023-0030(4) if the energy resource plan or combination of plans does not contain that information. If the energy resource plan or combination of plans contains the information described in OAR 345-023-0030(4), the applicant must provide a list of citations to the sections of the energy resource plan that contain the information.