States grappling with how to incorporate ambitious clean energy and social equity goals into utility resource planning might do well to keep tabs on a proceeding that Oregon regulators kicked off Wednesday.

The Oregon Public Utility Commission launched the effort (UM 2225) in response last year’s passage of House Bill 2021, which set the most aggressive clean energy standard in the country. The law directs Oregon’s investor-owned utilities to reduce their greenhouse gas emissions by 80% by 2030, on the path to achieving 100% GHG-free generation by 2040. (See West Coast Could be Net Zero by Midcentury.)

HB 2021 also calls for utility decarbonization strategies to provide economic benefits to residents while preventing any burdens from falling disproportionately on communities of color, low-income and rural communities, and tribes.

One provision of HB 2021 requires that, “to the maximum extent possible,” the move to emissions-free electricity create “meaningful living wage jobs,” promote “workforce equity,” and increase “energy security and resiliency.” Another calls for utilities to examine the “costs and opportunities” of procuring electricity from community-based renewable energy resources intended to contribute to local economic development and resiliency.

The law stipulates that all those objectives be reflected in utilities’ clean energy plans (CEPs), which must be “based on or included in” their integrated resource plans (IRPs), submitted every two years for approval by the PUC.

At Wednesday’s meeting, the commission acknowledged the open-ended nature of its “investigation” into how it will integrate HB 2021 goals into its existing utility planning and procurement processes — and how the law will likely alter those processes.

“[HB 2021] makes GHG reductions a clear driver [of planning and procurement] and asks us to unpack and capture community benefits, and it prioritizes equity for those who participate in the transition and who shoulder its costs,” PUC Chair Megan Decker said.

“The only way for us to implement such a big and broad vision — full of new concepts — successfully will be to adopt a learning orientation, to recognize that we’ll be iterating, taking up some things and saving others for later, making decisions, evaluating what worked and adjusting,” Decker said.

The PUC chair said she foresees a “lengthy period of evolution” for developing the new planning framework.

“IRPs are not built in a day, and CEPs are even harder with all of the integration of other planning processes that have emerged and new issues that are introduced,” she said.

“I appreciate the framing of both the continuous learning mindset that we will have to adopt here and the scale of the evolution in regulation that is envisioned by this whole package of legislation, and the need for it all to integrate and work with each other,” Commissioner Letha Tawney said.

Increasing Complexity

Caroline Moore, administrator of the PUC’s Strategy and Integration Division, said the commission’s most pressing objective is to provide utilities with the “near-term” guidance needed to craft their first CEPs, likely to be filed in March 2023 along with updated IRPs.

“That’s why we’re being really intentional about this scoping effort and trying to tease out what is critical to establish now [and] what’s the best way to establish it,” Moore said.

There are two immediate questions “at play” in the proceeding, Moore said. The first revolves around how to incorporate CEP requirements into current processes, while the second delves into how the commission can streamline those processes to help utilities meet the fast-approaching deadlines for their clean energy targets. The commission hopes to have more clarity on those issues by the end of the third quarter of this year, she said.

Elaine Hart, a consultant the commission hired to survey Oregon IRP stakeholders (including utilities, consumer advocates, local governments and community groups) on PUC processes, said many survey respondents expressed concern that CEPs will increase the technical complexity of questions already being dealt with in the planning process.

“It’s hard to plan for a low-carbon system, and it’s hard to plan with the geographical granularity that you need to make decisions that are informed by community input that are meaningful,” Hart said. “These are technically challenging problems, and they don’t always nicely fit into the buckets that our existing processes provide in terms of information analysis and decision making.”

Hart said that while survey respondents lauded Oregon’s planning process for the ability to influence utilities, IRP engagement is “typically limited” to a “relatively small number” of stakeholders.

“So, the question of whether the utility has provided adequate opportunity for public input across the IRP, the [distribution system planning] and the CEP may look different in an HB 2021 world, where there’s a greater emphasis on local impacts,” Hart said.

Comments from the Field

During Wednesday’s virtual meeting, participants commenting in the “chat” area of the meeting screen provided an indication of what some stakeholders hope to see in a planning process reshaped by HB 2021.

Heide Caswell of PacifiCorp and Nidhi Thakar of Portland General Electric (NYSE:POR) both expressed hope that the commission will integrate the CEP process with its distribution system planning process.

Norm Cimon, a founding member of Oregon Rural Action, wrote that his group’s “key issue” is how the residents in the 25% of the state “where the sun shines brightest and the wind blows hardest — can be full participants in the transition to an economy powered by distributed generation of renewable energy.”

Max Greene, regulatory and policy director at Renewable Northwest, said his organization wants “to establish a process that honors HB 2021’s equity considerations and gets us on a path to a zero-emissions grid ‘as soon as practicable’ and no later than the act’s binding GHG targets.”

Oregon Solar + Storage Industries Association Executive Director Angela Crowley-Koch said she agreed with Greene’s comment and “also would like to see community resilience included in plans, not just grid resilience. This includes incorporating the goals of HB 2021 to create economic development opportunities for Oregonians with projects built here.”

“We would like see how to make the clean energy plans meaningful and make sure that they work in tandem with the current planning processes in Oregon and the region rather [than] a separate process,” Irion Sanger wrote on behalf of the Northwest & Intermountain Power Producers Coalition. “We are interested in seeing how the CEP will also ensure that the procurement process allows for diverse ownership of renewable energy sources.”

For all the complexity it introduces into Oregon’s IRP process, HB 2021 may have just accelerated the inevitable, said Tawney.

“I think in some ways, our IRP processes have been straining a bit there at the seams to try to cope with the way the grid is changing, and the way customer preferences are changing — and on and on,” she said.