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ORDER NO. PSC-2018-0028-FOF-EI DOCKET NO. 20180001 -EI PAGE 10 The avoided generation cost component considered avoided generation capital, avoided fixed O&M, avoided transmission interconnection, avoided capital replacement, incremental gas transport, and short-term purchases. The avoided system cost component considers the factors of fuel savings, avoided variable O&M, and emission cost savings. FPL's CPVRR analysis assumed that each project had an actual life of 33 years, with the analysis ending in 2050. The emission cost savings consideration did not incorporate CO2 pricing until 2028. FPL witness Enjamio identified ICF's CO2 emission's cost forecast as a major assumption in FPL's economic analysis of its proposed solar PV generation projects. The CO2 cost projections used in FPL's cost-effectiveness analyses are based on ICF's CO2 emission cost forecast dated December 2016. ICF is a consulting firm with extensive experience in forecasting the cost of air emissions and is recognized as one of the industry leaders in this field. FPL has used ICF's CO2 emission cost forecasts in many of its filings, including the recently approved 2017 Ten Year Site Plan. No intervenor offered testimony rebutting FPL's CO2 emission cost forecast or provided any alternative emission cost forecast. For these reasons, we find that the CO2 cost projections FPL used in this docket are reasonable and appropriate. 1. CPVRR Analysis - Initial Filing We reviewed FPL's original CPVRR for the 2017 and 2018 solar generation projects that produced a savings of $38.6 million for the base fuel and environmental forecasts. This calculation included the previously mentioned CO2 pricing in 2028. FPL's CPVRR analysis in support of its 2017-2018 Solar Plan included assumptions related to future fuel prices. The Company employed its standard fuel forecasting methodology to produce its long-term fuel price forecast. No alternative base fuel forecast was provided to us for the purposes of evaluing the Company's 2017-2018 Solar Plan. We find that the forecasted fuel prices used in the Company's CPVRR analysis associated with its current proposal are reasonable. FPL provided a CPVRR analysis with both fuel and environmental compliance sensitivities. In FPL's analysis, a Low, Medium, and High Fuel Forecast and ENV I, ENV II, and ENV III compliance costs were considered. ENV I assumes an annual $0/ton cost for CO2 pricing and low environmental compliance costs, ENV II assumes a most likely cost, and ENV III assumes high environmental compliance costs. The range of savings is illustrated in Table 5 below: Table 5 Initial CPVRR Filing Source: EXH 84 2. CPVRR Analysis - Revised Filing FPL witness Enjamio filed revised testimony August 2, 2017, providing an updated economic analysis to reflect a change in cost effectiveness and cost assumptions for the 2017- Environmental Compliance Cost Forecast Fuel Cost Forecast ENV I ENV II ENV III High ($63.5) ($136.4) ($291) Medium $35 ($38.6) ($195.8) Low 1 $127.3 1 $53.6 $103.1 Source: EXH 84 2. CPVRR Analysis - Revised Filing FPL witness Enjamio filed revised testimony August 2, 2017, providing an updated economic analysis to reflect a change in cost effectiveness and cost assumptions for the 2017-