In two separate decisions siding with Sierra Club, the Wyoming Public Service Commission and Washington Utilities and Transportation Commission rejected PacifiCorp's request for huge rate increases, and denied the company’s request to shift the burden of volatile fossil fuel costs to ratepayers. These wins ensure that energy providers must put some of their own money at risk when investing in fossil-fueled energy generation rather than allowing them to downplay the financial risk of fossil fuel investments by shifting it to customers.
In 2023, PacifiCorp asked for huge rate increases in both states (over 20% in Wyoming and over 16% in Washington), citing rising and unpredictable coal and gas fuel costs. At the same time, PacifiCorp wanted to eliminate longstanding cost-sharing mechanisms that required the company to absorb varying percentages of coal and gas fuel costs when such costs are higher than expected. In other words, just as PacifiCorp forecasted heavy investment in gas resources in its 2023 long-range energy plan, the company asked state regulators to shift 100% of gas price risks to its customers. The status quo would require the company to absorb between 10 and 50% of fuel cost overruns. Sierra Club intervened in both proceedings to ensure PacifiCorp continues to absorb costs when it decides to invest more heavily in fossil fuels.
In both states’ rulings, the Commissioners unanimously agreed to maintain the fuel cost sharing mechanisms, finding that the sharing mechanisms not only incentivize PacifiCorp to reduce its costs but also appropriately balance risks between shareholders and customers. In Washington, the Commission also emphasized that the cost sharing mechanism ensures that PacifiCorp has some financial “skin in the game” when it decides whether to invest in fossil fuels with volatile fuel costs or, alternatively, in zero-fuel cost resources, like wind and solar.
Sierra Club was represented in both cases by Environmental Law Program attorney Rose Monahan. To support Sierra Club's legal strategy, the Field Department, Wyoming Chapter, Environmental Law Program, and Communications Department collaborated on public outreach, including an AddUp petition page, letters to the editor at local newspapers, ad buys, and sending postcards to PacifiCorp customers, urging them to write into the Wyoming Commission, among other tactics. Sierra Club's communication strategy significantly contributed to garnering public attention, which resulted in an unprecedented level of public participation with the Wyoming Commission receiving over 5,000 comments.