New report looks at concerns from first phase of Clean Energy Transformation Act evaluations

Implementation of the Clean Energy Transformation Act (CETA) was difficult for smaller public electric utilities across Washington, but their experience with and understanding of the law’s complex requirements is growing, as detailed in a new report from the Office of the Washington State Auditor. 

The act tasks the State Auditor’s Office with auditing the state’s 39 publicly owned electric utilities for their compliance with its requirements. For example, they must develop plans to provide most of their power from renewable or non-emitting sources by 2030 and reduce customer energy costs by offering low-income energy assistance programs. The Office summed up lessons learned in its first round of reviews in the report, now available online: Electric utilities’ compliance with the Clean Energy Transformation Act (CETA).

The first audits of utility compliance with CETA looked at the period from 2019 to 2021. That audit work began in 2022 and was significantly extended as auditors sought clarification from the state Department of Commerce and the Attorney General’s Office on how utilities were expected to implement the law. In that first round of audits, the State Auditor’s Office issued: 

• 6 unmodified, or clean, opinions 

• 6 adverse opinions, indicating the utility did not comply with the act 

• 24 qualified opinions, indicating the utility complied except for an identified problem 

Auditors noted all the utilities with clean opinions serve more than 25,000 customers and therefore had already developed processes to comply with the earlier state Energy Independence Act. 

Some smaller utilities, however, did not realize CETA applied to them, and many found it difficult to navigate the requirements of the act with limited staff. Their managers and staff expressed frustration with their inability to obtain formal guidance from the state on meeting the act’s requirements.  

In all, the first group of audits included 81 finding-level issues related to two broad requirements of CETA: low-income energy assistance program offerings and clean energy implementation plans. The State Auditor’s Office recommended that all utilities work with the Department of Commerce to gain a better understanding of how to implement the act. Auditors also recommended smaller utilities particularly focus on improving their compliance with the law and rules around the low-income programs and assessment reporting and development of clean energy implementation plans. 

The State Auditor's website includes the full CETA compliance report (PDF) and more information about energy compliance examinations.