Oregon's Utility Commission releases roadmap to actively adapt to the changing electric sector

Posted Sep 18, 2018

SB 978 report identifies climate and equity as top issues for the state to address

SALEM, Ore. – In response to Senate Bill (SB) 978, the Oregon Public Utility Commission (PUC) has developed a roadmap for adapting regulation to the changing electric sector. The report also recommends ways to make progress on climate and equity – the two top issues identified in the PUC’s public process.

SB 978 (2017) directed the PUC to develop a public process to explore how the existing regulatory system for investor-owned electric utilities is impacted by rapidly changing technology and policy. Any recommendations had to maintain the PUC’s focus on affordable rates, safety, and reliable service.

“The PUC’s strength is using unbiased, economic analysis and independent decision-making that balances trade-offs among competing priorities,” said Megan Decker, Commission Chair. “This report creates an overarching framework for the PUC to organize its work to adapt to an evolving sector.”

The PUC engaged participants in a dynamic and inclusive public process, which provided invaluable feedback from groups and individuals across Oregon. The process included experienced and new PUC stakeholders, all of whom brought important perspectives. The majority of SB 978 participants prioritized:

addressing climate change by reducing greenhouse gas emissions, and

increasing equity by improving equitable and affordable access to energy services.

Participants also explored ways to update the PUC’s regulatory tools and structures to enable innovation in a context of rapidly changing technology options, electric system needs, and customer preferences.

“We value stakeholders’ active participation in the SB 978 process and count on them to continue to work together to help inform the future direction of the PUC,” Decker continued.

Fully integrating these priorities may require changes in the PUC’s authority, which is delegated from the Legislature. The PUC uses economic regulation to ensure that investor-owned utilities offer safe and reliable electricity at reasonable rates to everyone in their service territories. SB 978 participants reaffirmed that these goals remain central to the PUC’s mission.

The PUC’s report recommends action in six areas:

Climate Change – Reducing greenhouse gas emissions is a high priority for the State of Oregon and the PUC’s stakeholders, but the PUC lacks a clear mandate to address emissions except as an economic risk. The PUC recommends that the Legislature take up this regulatory gap.

Affordability, Equity, and Environmental Justice – The PUC recommends that the Legislature consider ways to improve equitable access to energy services. The PUC can and will take some steps without legislative action, but some approaches used successfully elsewhere may not be within the PUC’s current authority.

Retail Customer Options – The PUC will work to achieve consistent pricing for energy resources such as solar, storage, and demand side measures, such as energy efficiency, to keep pace with rapidly changing technology and supply options.

Utility Incentive Alignment – The PUC will launch a performance-based regulation process to align utility incentives with customer objectives and explore areas of utility service where the PUC could provide incentives for innovative approaches to providing electricity service.

Regional Market Development – The PUC will participate with other states and agencies to promote the development of a regional market, which would enable efficient wholesale competition and regional resource diversity to lower costs and risks to customers.

Participation – The PUC will develop a strategy to enhance public engagement and inclusion in PUC processes.

View the PUC’s SB 978 Report for additional information.