PacifiCorp 2007 Integrated Resource Plan (May 30, 2007)

PacifiCorp – 2007 IRPChapter 8 – Action PlanRESOURCE PROCUREMENTOverall Resource Procurement StrategyTo implement resource decisions in the action plan, PacifiCorp intends to use a formal and transparentprocurement program in accordance with the then-current law, rules, and/or guidelines ineach of the states in which PacifiCorp operates. The IRP has determined the need for resourceswith considerable specificity and identified the desirable portfolio resource characteristics andtiming of need. The IRP has not identified specific resources to procure, or even determined apreference between asset ownership versus contracted resources. These decisions will be madesubsequently on a case-by-case basis with an evaluation of competing resource options includingupdated available information on technological, environmental and other external factors such aselectric and natural gas price projections. These options will be fully developed using competitivebidding with a request for proposal (RFP) process, or other procurement methods as appropriate.For demand-side resources, PacifiCorp uses a variety of business processes to implement DSMprograms. The outsourcing model is preferred where the supplier takes the performance risk forachieving DSM results (such as the Cool Keeper program). In other cases, PacifiCorp projectmanages the program and contracts out specific tasks (such as the Energy FinAnswer program).A third method is to operate the program completely in-house as was done with the Idaho IrrigationLoad Control program. The business process used for any given program is based on operationalexpertise, performance risk and cost-effectiveness. As with supply-side resources, thecompany may resort to competitive bidding with an RFP process to uncover new program opportunities.Renewable ResourcesThe 2007 integrated resource plan identifies 2,000 megawatts of renewable resources to be acquiredby 2013. Under this plan, the company seeks to acquire 1,400 megawatts of new renewableresources by 2010, with an additional 600 megawatts in place by 2013. The 2,000 megawattsof renewable resources is inclusive of the 1,400 megawatts of cost-effective renewableresources identified in the company’s renewable plan. In order to fill this requirement, the companywill continue to aggressively pursue the acquisition of these resources through various approachesincluding new requests for proposals, bi-lateral negotiations, the Public Utilities RegulatoryPolicy Act, and self-development. While the company used wind for modeling purposes inthe integrated resource planning process, renewable generation includes other fuel sources suchas biomass and landfill gas. In addition, the company will actively seek to add transmission infrastructureand flexible generating resources, such as natural gas, to integrate new wind resourcesand work to continuously improve its understanding of how to integrate large amounts ofwind into its portfolio in a reliable and cost-effective manner.Demand-side ManagementThe company has a variety of ongoing programs and associations to procure energy efficiencymeasures (Class 2 demand-side resources) from industrial, commercial and residential customers.These programs will be leveraged, and company-offered programs extended to other states,229