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Committee hears testimony for study on avoided-cost calculations and small-scale renewables
Summary
House Bill 3868 would direct the Oregon Department of Energy to study avoided-cost calculations for small-scale renewable projects and report by Sept. 15, 2026; supporters urged transparency for financing and market access, while Portland General Electric opposed duplicative study work.
The committee held a public hearing on House Bill 3868, which would require the Oregon Department of Energy to study avoided costs paid to qualifying facilities under the federal Public Utility Regulatory Policies Act (PURPA) and to report findings by Sept. 15, 2026. The bill sets a statutory sunset for the study and reporting requirements on Jan. 2, 2027.
Supporters, including James Williams (executive director of the Community Renewable Energy Association and Lake County commissioner) and Angela Crowley Cook (executive director of the Oregon Solar and Storage Industries Association), said a state-led study would “pull back the curtain” on how investor-owned utilities calculate avoided costs and improve transparency for small-scale renewable developers. They argued that standard avoided-cost contracts and predictable rates help projects secure financing and enable small, locally owned projects to compete for development opportunities.
Witnesses described avoided cost as “the amount the utility would pay if the utility were procuring comparable power” and said the rate is intended to be cost-neutral for ratepayers. Testimony from small project developers and farmers described how standard contracts under PURPA allowed some projects to obtain financing and proceed to construction.
Portland General Electric testified in opposition, saying avoided-cost calculations rely on complex modeling and forecasting that are already subject to regulatory oversight by the Oregon Public Utility Commission and active dockets. PGE urged the panel not to duplicate PUC work and said the PUC is the appropriate venue for technical review. Committee members pressed PGE on whether ongoing dockets provided sufficient transparency and whether the legislature should exercise oversight; PGE pointed to an open PUC docket on the subject.
Ending: The committee closed the hearing on HB 3868 after receiving testimony from industry groups, developers and utilities. No committee vote was recorded during the hearing; the bill was available for later scheduling and carryover by the chair.
