20241119Staff Comments .pdf

RECEIVED
Tuesday, November 19, 2024 10:12:59 AM
IDAHO PUBLIC
UTILITIES COMMISSION
CHRIS BURDIN
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
IDAHO BAR NO. 9810
Street Address for Express Mail:
11331 W CHINDEN BLVD, BLDG 8, SUITE 201-A
BOISE, ID 83714
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF IDAHO POWER )
COMPANY'S APPLICATION FOR ) CASE NO. IPC-E-24-35
AUTHORITY TO FUND ITS CONTINUED )
PARTICIPATION IN THE NORTHWEST )
ENERGY EFFICIENCY ALLIANCE IN 2025- ) COMMENTS OF THE
2029 THROUGH THE ENERGY EFFICIENCY ) COMMISSION STAFF
RIDER )
COMMISSION STAFF ("STAFF") OF the Idaho Public Utilities Commission, by and
through its Attorney of record, Chris Burdin, Deputy Attorney General, submits the following
comments.
BACKGROUND
On September 10, 2024, Idaho Power Company("Company") filed an application
("Application") with the Idaho Public Utilities Commission("Commission")requesting
authorization to continue the Company's participation in the Northwest Energy Efficiency
Alliance ("NEEA") for the period of 2025-2029 ("Cycle 7"). The Company requested its
proposed participation be funded through the Idaho Energy Efficiency Rider("Rider").
STAFF COMMENTS 1 NOVEMBER 19, 2024

The Company represents that NEEA is a non-profit organization whose purpose is to
maximize energy efficiency in the Northwest, and that the Company is currently an active
member in NEEA. Application at 2.
The Company represents that it has funded NEEA since the organization's inception, and
that since 2002 the Commission has authorized the Company to recover the costs for Demand
Side Management programs and NEEA participation from the Rider. Id. at 3-4.
The Company represents that continued participation in NEEA is a wise use of customer
funds and will provide sufficient direct benefits to Idaho residents. Id. at 10. The Company
states that the term of the Company's proposed agreement with NEEA would begin January 1,
2025, and expire on August 1, 2030,unless otherwise terminated. Id. at 11.
The Company represents that its 9.56% funding share results in a cost of$20,256,215
over five years, or $4.1 million annually. This funding amount represents an increase to overall
cost from the previous Cycle cost of$14,710,808, or$2.9 million annually. Id. at 12.
STAFF ANALYSIS
Staff has reviewed the Company's Application, discovery responses, Company cost-
effectiveness analysis, and NEEA presentation materials . In general, Staff believes that the
Cycle 7 NEEA funding is likely to result in cost-effective energy savings for the Company's
Idaho Customers, however concerns remain from the Company's previous EM&V and from
Staff s previous discovery.
Company's Analysis of NEEA's Cost-effectiveness
To support its Application, the Company has conducted a cost-effectiveness analysis of
the forecasted Cycle 7 savings. The Company's analysis suggests that the market transformation
efforts will be cost-effective with a UCT of 3.43 and will remain cost-effective under a variety of
assumptions. To inform this analysis, the Company used its Cycle 7 funding share costs,
NEEA's Cycle 7 net market effect savings forecast for the Company's service area, and the
Company's 2023 IRP avoided costs. Application at 10. This analysis does not include
forecasted savings for the standards initiative because NEEA was unable to provide a forecast.
Response to Production Request No. 1. In response to Production Request No. 1, the Company
provided workpapers detailing the calculations used to develop Table 3 of Nesbitt's testimony.
STAFF COMMENTS 2 NOVEMBER 19, 2024

Staff verified that the Company's analysis of the Cycle 7 cost-effectiveness appropriately reflects
the benefit to Idaho customers as a result of NEEAs efforts. Staff believes that the Company's
cost-effectiveness calculations are optimistic; however, NEEAs market transformation efforts are
likely to be cost-effective.
NEEA Third-Party Analysis
In Case No. IPC-E-23-10, the Company submitted a supplemental application containing
a third-party Evaluation Measurement&Verification ("EM&V") study of NEEA participation.
The recommendations from the EM&V addressed many of Staff's previous concerns with
funding NEEA's market transformation were addressed as a result of NEEA's responses to the
recommendations provided by the EM&V. However, at that time recommendation No. 9 was
left unresolved. Recommendation No. 9 states: "The Evaluators recommend an evaluation is
completed for each code update to estimate NEEA's qualitative and quantitative influence
towards the code update, or, alternatively, incorporating a quantitative method for isolating
incremental savings due to NEEA specific efforts approved by a third-party evaluator. or,
alternatively, incorporating a quantitative method for isolating incremental savings due to NEEA
specific efforts approved by a third-party evaluator." Drake Direct, Exhibit No. 6 at 16, IPC-E-
23-10.
In response to the EM&V,NEEA stated that it is willing to consider the recommendation.
However, since NEEA's current approach to report code energy savings was recommended by
its Cost Effectiveness Advisory Committee ("CEAC"), any changes would need to be discussed
by that committee. Application at 8. In response to the EM&V study recommendation,NEEA
has contracted a third-party evaluator to assess influence evaluation approaches and has
committed to a third-party review of its approach for establishing and estimating baselines for its
state energy codes work. Application at 8-9. While the result of these evaluations is subject to
the decisions of the CEAC, Staff believes that this is a good faith effort to address the EM&V's
recommendation. Staff recommends that the Company continue to consider the impact of
benefits to Idaho customers as a result of the CEAC decisions.
STAFF COMMENTS 3 NOVEMBER 19, 2024

Other Considerations and Concerns
In its comments in Case No. IPC-E-23-10, Staff describes additional concerns that were
not addressed by the EM&V. In the previous cycle, NEEA declared the market for ductless heat
pumps as transformed while potential for this technology in Idaho remained, resulting in the
Company and Avista pursuing a market transformation pilot specific to Idaho. In response to
Production Request No. 4, the Company provided NEEA's Cycle 7 15-year net market effect
forecasts for the Company's service territory. The portfolio calls for a total of 19.82 aMW of
savings, with 14.61 aMW of these savings expected to come from the Cycle 7's measure level
initiatives. Staff remains concerned that the regional focus of NEEA's efforts may again deviate
from benefiting Idaho customers in the future.
Additionally, Staff is concerned with the third-party influence evaluations conducted for
federal standards changes. These evaluations may continue to use a logic model provided by
NEEA causing uncertainty in the independence of those evaluations and the associated savings.
While these concerns remain, Staff believes that the responses to the EM&V recommendations
are a significant improvement to the previous funding cycle and the Company's participation is
expected to be cost-effective under a variety of circumstances. However, if in the future the
Commission deems that the Company's participation in NEEA is not in the best interests for
Idaho ratepayers, the Company has provisions in its NEEA contract that allow the Company to
terminate its agreement and cease funding of Cycle 7.
STAFF RECOMMENDATION
Staff recommends that the Commission issue an order authorizing the Company to
continue participation in NEEA for the 2025-2029 period and to fund the participation through
the Rider.
Respectfully submitted this 19th day of November 2024.
1 ,-,-4- LA
Chris Burdin
Deputy Attorney General
Technical Staff Jason Talford
I:\Utility\UMISC\COMMENTS\IPC-E-24-35 Comments.docx
STAFF COMMENTS 4 NOVEMBER 19, 2024

CERTIFICATE OF SERVICE
�'
I HEREBY CERTIFY THAT I HAVE THIS G l DAY OF NOVEMBER
2024, SERVED THE FOREGOING COMMENTS OF THE COMMISSION STAFF, IN
CASE NO. IPC-E-24-35, BY E-MAILING A COPY THEREOF, TO THE
FOLLOWING:
MEGAN GOICOECHEA ALLEN CONNIE ASCHENBRENNER
LISA D NORDSTROM MARY ALICE TAYLOR
IDAHO POWER COMPANY IDAHO POWER COMPANY
PO BOX 70 PO BOX 70
BOISE ID 83707-0070 BOISE ID 83707-0070
E-MAIL: mgoicoecheaallen(ai)idahopower.com E-MAIL: [e-mail]
[e-mail] [e-mail]
[e-mail]
h
PA RICIA JORDAN, SF/—RE-TARY
CERTIFICATE OF SERVICE