Minnesota PUC to look June 17 at rehearing request from Aurora Distributed Solar

At their June 17 meeting, the members of the Minnesota Public Utilities Commission are due to look at a motion for reconsideration filed by Aurora Distributed Solar LLC related to a commission rejection of the pass-through of part of the cost for a 100-MW solar project.

In April 2015, Northern States Power d/b/a Xcel Energy petitioned the commission for approval of Minnesota-jurisdictional costs of the Aurora Power Purchase Agreement (Aurora PPA). The Aurora PPA is for 100 MW of distributed solar energy. The project was selected through a competitive resource acquisition process which solicited and evaluated proposals to meet Xcel’s capacity need identified in its 2011-2025 Integrated Resource Plan.

In August 2015, the commission approved the Aurora PPA and found that while meeting renewable energy objectives was not the principal purpose of the Aurora PPA, the project was nonetheless a reasonable and prudent part of Xcel’s plan to meet its obligations under the state’s Solar Energy Standard (SES). Therefore the commission authorized cost recovery of the Minnesota-jurisdictional portion of the Aurora PPA through the fuel clause rider.

In October 2015, Xcel Energy filed a petition for recovery in Minnesota of a portion of the North Dakota jurisdictional costs of the Aurora PPA (ND Cost Petition) after those costs were not granted an Advanced Determination of Prudence (ADP) by the North Dakota Public Service Commission (ND PSC).

Xcel described a letter agreement between itself and Aurora Distributed Solar providing that Aurora would bear North Dakota-related costs of the Aurora PPA if both Minnesota and North Dakota commissions rejected recovery of those costs from ratepayers in those states. This concession was in exchange for Xcel not exercising certain PPA termination rights relating to unrecovered costs.

On April 13, the Minnesota commission issued its order denying recovery of North Dakota-related costs. The prder denied Xcel’s petition with prejudice. The order first provided that Xcel had not met its burden to establish that it is reasonable to recover the Aurora PPA’s North Dakota-related costs from Minnesota ratepayers. The commission found that Xcel’s request for recovery provided:

  • no data to determine whether the proposal was a reasonable way to meet the needs of only Minnesota ratepayers (the analysis finding the Aurora Project a cost-effective proposal was conducted on a system-wide basis); and
  • no quantification of the specific rate impact of the proposal in its filings.

The Minnesota commission concluded that even if Xcel had provided sufficient data in its proposal, it was not just or reasonable for Xcel’s Minnesota ratepayers to subsidize North Dakota ratepayers’ consumption of solar energy.

On May 3, Aurora filed its petition for reconsideration. Aurora made three main claims. A briefing memo filed June 13 by Minnesota commission staff said that Aurora’s three claims are:

  • Use of term “with prejudice.” Aurora argued that the use of the language ‘with prejudice’ is: unnecessary and seemingly precludes further discussion of the allocation of the North Dakota-portion of costs and benefits of the Aurora PPA; unusual for use in commission orders; unsupported in the commission’s April 13 order (and contrary to the order language); and contrary to a Minnesota statute that makes all commission actions subject to further action upon the commission’s own motion or the motion of a party.
  • Equal treatment of similarly-situated developers.
  • Xcel’s burden and failure to demonstrate Aurora costs and benefits. Aurora argued that it was Xcel’s burden and failure, not Aurora’s, to provide sufficient data to demonstrate that the benefits of the Aurora Project would be retained by Minnesota ratepayers – and Aurora could not have provided that information.

Said the staff memo: “The question for the Commission is whether it believes there is sufficient reason to grant a rehearing of its April 13, 2016 Order, and if so whether, upon rehearing, the Commission finds its decision either unlawful or unreasonable. Staff agrees with the [state Department of Commerce] that the arguments advanced by Aurora have not raised any new issues or legal arguments requiring further consideration. If the Commission wishes to provide clarity to parties, it could do so, but staff does not believe that the Commission has acted either unlawfully or unreasonably.”

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.