State regulators adopt rules for Integrated System Plans

Media contact: [email protected] or 360-664-1116
Docket number: U-240281

Plans must merge gas and electric filings and add a cost test to meet clean energy goals

LACEY, Wash. - Today, the Utilities and Transportation Commission has adopted rules to implement Integrated System Plans under Engrossed Substitute House Bill 1589. The rules adopt requirements for large combination utilities when combining gas and electric planning requirements into one Integrated System Plan (ISP), and establish a cost test for ISP emission-reduction measures to meet the state's clean energy and climate policies.

Over the next three years, large combination utilities will work with the commission to refine data requirements and planning methods. Puget Sound Energy, the state's only large combination utility, must file its first ISP in 2027, replacing separate gas and electric filings with one transparent plan that models costs and timelines for decarbonizing energy services for customers.

ISPs are intended to support utilities' goals for affordability, reliability, and emissions reduction while helping to stabilize energy costs over time. The rules do not set new emissions limits; instead, they align commission oversight with the state targets of 80% non-emitting resources by 2030 and 100% by 2045.

In adopting these rules, the commission clarifies that they do not ban natural gas, change utility service obligations, or set new rates. As ISPs are implemented, the commission will consider their impacts on low-income and underserved communities, as it does with current gas and electric plans, in rate cases and subsidy programs.

Background

In 2023, the Washington Legislature passed ESHB 1589, or the Large Combination Utilities Decarbonization Act, asking the commission to develop rules to allow utilities providing both gas and electric service to merge their resource planning into a single ISP. The law also requires a standardized cost test to measure the value of emission-reduction projects against the state's clean-energy goals. In 2024, the commission began the rulemaking process by filing a statement of inquiry, launching research, outreach, and draft rule development processes.

Late in 2024, two unexpected events slowed progress. Voters approved Initiative 2066, which would have forced major changes to the draft rules before the courts invalidated the initiative. At the same time, a severe storm caused widespread power outages and delayed a key technical workshop for the cost test. To ensure a thorough and fair process, the commission extended its rulemaking schedule by 90 days, moving its final rule deadline to Sept. 27, 2025, and delaying the first utility plan filings from Jan. 1, 2027, to April 1, 2027.

Since September 2024, the commission has been sharing proposed rule language and gathering public input. Two public workshops, three technical sessions on the cost test, and four rounds of draft notices have shaped the current rules that will guide Washington's clean-energy planning and investments.

About the UTC

The UTC is the state agency that regulates private, investor-owned electric and natural gas utilities in Washington. It is the commission's responsibility to ensure regulated companies provide safe, equitable, and reliable service to customers at reasonable rates, while allowing them the opportunity to earn a fair profit.

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