(1)The commission
shall require an electric or gas public utility subject to commission jurisdiction to
consider the social cost of carbon dioxide emissions and the social cost of methane
emissions, as set forth in subsections (4) and (5) of this section, when determining
the cost, benefit, or net present value of any plan or proposal submitted in one of
the following proceedings:
(a)Electric resource plans or any utility plan or application that considers or
proposes the acquisition of new electric generating resources or the retirement of
existing utility generation;
(b)Applications related to section 40-2-124;
(c)Applications related to, or the commission's evaluation of, programs
adopted under section 40-3.2-103;
(c.5) Applications related to, or the commission's evalua
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(1) The commission
shall require an electric or gas public utility subject to commission jurisdiction to
consider the social cost of carbon dioxide emissions and the social cost of methane
emissions, as set forth in subsections (4) and (5) of this section, when determining
the cost, benefit, or net present value of any plan or proposal submitted in one of
the following proceedings:
(a) Electric resource plans or any utility plan or application that considers or
proposes the acquisition of new electric generating resources or the retirement of
existing utility generation;
(b) Applications related to section 40-2-124;
(c) Applications related to, or the commission's evaluation of, programs
adopted under section 40-3.2-103;
(c.5) Applications related to, or the commission's evaluation of, programs
adopted under section 40-3.2-104; or
(d) A plan or application for transportation electrification under section 40-5-107 or any other form of beneficial electrification, including beneficial
electrification in buildings.
(2) In a proceeding listed in subsection (1)(a) of this section, a utility shall:
(a) At a minimum, model an optimization of a base case portfolio of resources
using the cost of carbon dioxide emissions, as set forth pursuant to subsection (4)
of this section. The cost of carbon dioxide emissions must apply to the evaluation of
all existing electric generation resources and to any new resources evaluated or
proposed as part of the resource modeling. The commission may require a utility to
file or propose additional base cases. The utility may propose, and the commission
shall consider, alternative optimized portfolios of resources in addition to the base
case, utilizing different levels of costs for carbon dioxide.
(b) (I) Present a calculation of the net present value of revenue requirement
for the resources in each optimized portfolio. To show the net present value of
revenue requirement that would be incurred by the utility for implementing the
portfolio, in addition to presenting the full net present value of revenue requirement
through a calculation using the cost of carbon dioxide emissions set forth pursuant
to subsection (4) of this section, the utility shall also present the full net present
value of revenue requirement through a calculation without using the cost of
carbon dioxide emissions set forth pursuant to subsection (4) of this section.
(II) In addition to the net present value of revenue requirement calculations
required in subsection (2)(b)(I) of this section, for each optimized model run, the
utility must provide a present value calculation showing the net present value of
the total cost of carbon dioxide emissions of each portfolio, calculated by
multiplying the total emissions of that portfolio by the cost of carbon dioxide set
forth pursuant to subsection (4) of this section.
(3) In approving a resource plan, either with generic resources or in the
analysis of bids in a competitive solicitation, the commission shall require a
comparison of the portfolios' net present value of revenue requirements inclusive of
the social cost of carbon dioxide. The commission shall also consider:
(a) The net present value of revenue requirements of the cost of carbon
dioxide or carbon dioxide equivalent emissions;
(b) The net present value of revenue requirements that would be incurred by
the utility for implementing the portfolio; and
(c) Other relevant factors, as determined by the commission.
(4) The commission shall base the cost of carbon dioxide emissions on the
most recent assessment of the social cost of carbon dioxide developed by the
federal government using a discount rate of two and one-half percent or less.
Starting in 2020, the commission shall use a social cost of carbon dioxide of not
less than sixty-eight dollars per short ton. The commission shall modify the cost of
carbon dioxide emissions based on escalation rates of the 2020 base cost by an
amount that is equal to or greater than the escalation rates established in the
technical support document. When calculating the cost of carbon dioxide emissions
for any proceeding listed in subsection (1) of this section, the commission shall use
a discount rate for the social cost of carbon dioxide that does not exceed the lesser
of two and one-half percent or any lower value established by the most recent
available successor to the technical support document. Notwithstanding the
discount rate used to develop the social cost of carbon dioxide value over the
planning period, the commission shall continue to discount any net present value
analysis of any optimized resource portfolio in the electric resource planning
process using discount rates that the commission deems appropriate.
(5) In the base case analysis of cost effectiveness as described in section
40-1-102 (5)(b), the commission shall apply the social cost of carbon dioxide and the
social cost of methane emissions to the benefit-cost calculation for programs that
are defined to be energy efficiency or beneficial electrification programs or that
incorporate behind-the-meter thermal renewable sources.
(6) Repealed.