PUC Outlines Possible Changes in Regulatory Process

Published Friday, September 28, 2018 4:00 pm

Few things affect all Oregonians as universally as utility rates. So, when the Oregon Public Utilities Commission (PUC) and Legislature consider overhauling the regulatory process, it’s a good idea to pay attention. A recently completed report offers insight into what might happen.

The process started in 2017 when the Oregon Legislature passed Senate Bill 978, establishing a process for the Oregon Public Utilities Commission (PUC) to investigate its regulatory procedures in light of developing industry trends and evolving policy objectives. As directed by the bill, the PUC completed a report on its findings and submitted it to the Legislature by September 15, 2018. On Tuesday, it discussed that report with the House Energy and Environment Committee during legislative days.

Some clear themes emerged from testimony at the Tuesday hearing: The PUC earned praise for using an inclusive, open, well-structured process to complete its report. And all stakeholders agreed on addressing climate change and protecting vulnerable customers as key policy objectives.

Regulated utilities operate in a unique competitive environment. Even with broad agreement on goals among stakeholders, working out the details of a new paradigm for something as complex as utility regulations would be difficult under any circumstances. Factoring in effects on climate change, equity and the other identified goals increases the challenge.

“There are very few business models out there that ensure that no one gets left behind,” pointed out Scott Bolton, PacifiCorp senior vice president for external affairs and customer solutions and an Oregon Business & Industry (OBI) executive committee member.

OBI will be watching the Legislature to see what they decide to do with this report. If the PUC gets new authority to incorporate factors such as climate change into rate-setting, this would have an impact on all businesses across the state. Beyond the issue of authority, there is the question of how to measure goals that cannot be quantified easily.

Utilities and businesses have been investing for years in equipment and processes to reduce greenhouse gases. Those investments are working and have been factored into rates. Imposing new costs, through changes in rate-setting regulations or through a cap-and-trade program, would force customers to pay twice.

OBI will continue to work with our member companies to advocate for policies that recognize the investments and efforts that Oregon businesses have made to reduce greenhouse gases and to ensure that any regulatory changes are clear, consistent and do not put Oregon companies at a competitive disadvantage.

Watch for a summary of the report in next week’s issue of Weekly Update.

To read the full report to the Legislature, click here.

To read an executive summary of the report, click here.