20260505Final_Order_No_37033.pdf

Office of the Secretary
Service Date
May 5,2026
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF INTERMOUNTAIN ) CASE NO. INT-G-25-07
GAS COMPANY'S APPLICATION FOR )
AUTHORITY TO REVISE RATE SCHEDULE )
EE-GS GENERAL SERVICE ENERGY ) ORDER NO. 37033
EFFICIENCY REBATE PROGRAM )
On November 21, 2025, Intermountain Gas Company ("Company") applied to the Idaho
Public Utilities Commission("Commission")requesting authority to revise Rate Schedule EE-GS
General Service Energy Efficiency(`BE") Rebate Program, effective January 1, 2026.
On December 19, 2025, the Commission issued a Notice of Application; Notice of
Suspension of Proposed Effective Date, suspending the Company's proposed January 1, 2026
effective date for the statutorily provided period of 30 days and five months, and Notice of
Intervention Deadline, setting a deadline for interested persons to intervene in the case. Order No.
36880. No petitions to intervene in the case were filed.
On January 23, 2026, the Commission issued a Notice of Modified Procedure setting
comment deadlines. Order No. 36914. Staff filed comments to which the Company replied. No
other comments were received.
Based on our review of the record, the Commission now issues this Final Order rejecting
the Company's proposed revisions to Rate Schedule EE-GS and directing the Company to refile
with further revisions to its proposed commercial rebate program.
BACKGROUND
The Commission approved the implementation of the Company's Commercial EE Program
as Rate Schedule EE-GS and a funding mechanism through Rate Schedule EEC-GS in Order No.
34941. The Commercial EE Program has been chronically over-funded due to limited customer
participation. See Order Nos. 36245 and 36337. To address the over-funded balance, the
Commission suspended the Rate Schedule EEC-GS charge effective October 1, 2024, with
instructions for the Company to file a case to evaluate the long-term program viability by the
earlier of the program becoming underfunded or the end of 2026. Order No. 36337 at 4.
ORDER NO. 37033 1

THE APPLICATION
The Company launched its Commercial EE Program in April 2021. Application at 3.
According to the Company, participation in the Commercial EE Program has been limited due to
factors such as outreach challenges and program design limitations.Id. at 3-4. The Company took
steps to identify methods to improve its Commercial EE Program offerings, including soliciting
feedback from Energy Service Representatives,the Stakeholder Committee,and customers and by
commissioning an independent process evaluation.Id. at 4. The Company has implemented much
of the feedback aimed at improving the program, including enhanced marketing and outreach,
formalized contractor engagement, preparatory steps to expand rebate offerings, and plans to
bolster data collection during the rebate application process.Id. at 4-6.
The Company proposed to revise Rate Schedule EE-GS as detailed in Exhibit Nos. 2 and
3 to the Application. Id. at 7. The proposed changes would significantly expand the programs
measure offerings. See Exhibit 2. The Company's current offerings with corresponding rebate
amounts are shown in Table No. 1 below, while the proposed measures and rebate amounts are
listed in Table No. 2 below.Id.
TABLE NO. 1: Current Rate Schedule EE-GS Measures/Incentives
Measure Description Rebate Amount
Griddle ENERGY STAR'' $200
Certified
Fryer ENERGY STAR1 $800
Certified
Steamer ENERGY STAR" $1,100
Certified
Boiler Reset Control Unit Installed S350
High-Efficiency Minimum 90% Thermal
Condensing Boiler Efficiency & 300 kBtuh S4.50/kBtuh
input
Condensing Unit Heater 900/o AFUE $1,500
ORDER NO. 37033 2

TABLE NO. 2: Proposed Rate Schedule EE-GS Measures/Incentives
Measure Description Rebate Amount
Boiler Reset Control Unit Installed $1.50 per
300kBtu/h capacity
High-Efficiency Condensing Boiler Minimum 84%thermal efficiency $6.000
>300kBtu/h
High-Efficiency Condensing Boiler Minimum 93%AFUE $1,500
<300kBtu/h
Storage Water Heater New ENERGY STAR Certified $3,500
Construction
Storage Water Heater Retrofit ENERGY STAR Certified $6,000
Less than 200 kBtu/hr: Minimum 0.81 UEF, or
Tankless Water Heater New minimum 85%thermal efficiency. $6.000
Construction Greater than or equal to 200 kBtulhr. Mminimum
84%thermal efficiency.
Less than 200 kBtu/hr: Minimum 0.81 UEF,or
Tankless Water Heater Retrofit minimum 85%thermal efficiency. $8.000
Greater than or equal to 200 kBtu/hr: Mminimum
84%thermal efficiency.
Furnace 95%AFUE Minimum 95%AFUE $200
Gas Heat Pump<65kBtu > 1.2 COP for heating&> 1.0 COP for cooling $2,000
Gas Heat Pump 65-135kBtu > 1.2 COP for heating&> 1.0 COP for cooling $6.000
Gas Heat Pump 135-240kBtu > 1.2 COP for heating&> 1.0 COP for cooling $10,000
Gas Heat Pump Water Heater >1.2 COP for heating $150
Pipe Insulation Minimum 1"of insulation indoor. $2 per foot
Energy Star Convection Oven ENERGY STAR Certified $150
Energy Star Dishwasher High ENERGY STAR Certified $500
Temp
Energy Star Dishwasher Low Temp ENERGY STAR Certified $1,000
Energy Star Fryer ENERGY STAR Certified $550
Energy Star Convection Griddle ENERGY STAR Certified $100
The Company's Commercial EE Program is funded by the EE Charge rider on Rate
Schedule EEC-GS. Id. at 6. Since suspending the EEC-GS charge on October 1, 2024, the
overfunded balance of the rider has decreased from $1,034,285 in December 2024 to $716,924 as
of September 30, 2025.Id. The Company stated that with the expanded rebate offerings proposed
in the Application,its Commercial EE Program has an estimated cost of$866,100 for the first year
and could cause the rider to have an underfunded balance. Id. The Company represented that it
will monitor the rider balance and seek to implement adjustments as needed to ensure financial
balance.Id.
ORDER NO. 37033 3

STAFF COMMENTS
Staff reviewed the Application, supporting workpapers, and the Company's responses to
discovery requests. Staff Comments at 2.Based on its review, Staff recommended the Commission
deny the Company's request to revise Rate Schedule EE-GS and direct the Company to refile for
authorization to make specific modifications to its Commercial EE Program. Id.
Staff noted that the implementation of the proposed Rate Schedule EE-GS's storage and
tankless water heater measures combined accounted for approximately 77 percent of the
Company's forecasted first year savings. Id. at 5. Accordingly, Staff scrutinized these measures
and diagnosed several potential issues with the proposals. Id. Staff believed the Company's
estimated savings, incremental costs, and rebate incentives for the new construction and retrofit
tankless water heater and storage water heater measures were unreasonably high.Id. at 6, 11.
While Staff would expect commercial measure savings to be higher than those of
comparable residential measures, it thought the Company's estimated savings for the commercial
tankless water heater measures of at least 24 times more therms than their residential counterparts
and estimated savings for the commercial storage water heater measures of at least 35 times more
therms than their residential counterparts was excessive.Id. at 6, 11. Staff also believed the savings
estimates were unrealistically optimistic when compared to those of Avista Utility Company's
commercial natural gas tankless water heater and storage water heater rebates.Id. at 6-7, 11.
Staff further argued that the Company's methodology for forecasting the incremental costs
of its proposed tankless water heater measures failed to account for the cost of baseline equipment
and that the incremental cost was improperly based on the value of a storage water heater,resulting
in unreasonably high values.Id. at 9. Staff stated that the Company also used storage water heaters
with capacities larger than residential-sized equipment to calculate estimated incremental costs for
the storage water heater measures, leading to inflated values. Id. at 12. Relatedly, Staff believed
that both the Company's tankless water heater and storage water heater measure proposals over-
incentivized light commercial-sized units, because the incentive amounts were based on the
incremental cost estimates.Id. at 9-10, 12.
Because the tankless water heater and storage water heater measures compose such a large
portion of the Company's proposed Commercial EE Program, without corrected estimates and
rebate offerings for these measures, Staff stated that it was unable to "provide a clear
ORDER NO. 37033 4

recommendation regarding the Company's other proposed changes." Id. at 13. However, Staff
generally noted that given the infancy of the proposed portfolio,it recommended setting incentives
no higher than the estimated incremental cost of each measure.Id. at 13-14. Additionally, though
Staff was not opposed to certain other proposals—including the retirement of the condensing unit
heater and Energy Star steamer measures; the reduction of incentives for the Energy Star fryer and
Energy Star griddle measures; and the restructured incentives for the boiler reset control and high-
efficiency condensing boiler measures—it believed all proposed changes should be reevaluated
given the profound impact the recommendations concerning the tankless water heater and storage
water heater measures would have on the portfolio's cost-effectiveness.Id. at 14.
Finally, Staff noted that according to the Company's forecast, Rate Schedule EEC-GC
would become underfunded with the first 12 months of the new Commercial EE Program. Id. at
16.However, Staff believed that there was a pattern of the Company over-forecasting rebate counts
and program expenses and that it could take longer than anticipated for Rate Schedule EEC-GC to
become underfunded.Id. at 15-16. Staff stated that it would continue to monitor the balance while
making requests of the Company as necessary.Id. at 16.
COMPANY REPLY COMMENTS
The Company stated that it was willing to reevaluate Rate Schedule EE-GS and reapply
seeking revision, however, it requested clarity from the Commission prior to doing so. Company
Reply Comments at 1-2. Additionally, the Company sought to provide its own clarification
regarding Staff s questioning of certain elements of the Application.Id. at 1.
Through discussions with Staff, the Company had understood it was encouraged to
maintain consistency between assumptions used for commercial and residential measures.Id. at 2.
Had the Company recognized Staff s concerns were instead regarding consistency between the
Company's savings estimates and those of peer utilities, it would have addressed that topic while
developing the Application.Id. The Company stated that it would use the savings estimates of peer
utilities for comparison when reevaluating its Commercial EE Program offerings.Id. at 3.
The Company stated that it had intended to apply to increase Rate Schedule EEC-GC in
compliance with Order No. 36337 if the Commission approved the proposed revisions to Rate
Schedule EE-GS. Id. However, with the uncertain status of its Commercial EE Program in the
ORDER NO. 37033 5

wake of Staff s comments, the Company was unable to request an increase to the rider. Id. As of
January 31, 2026, the rider balance remained overfunded by $624,907.77.Id.
The Company commissioned an industry technical expert to develop a technical reference
manual, which established the savings estimates included in the Application. Id. at 4. The
Company planned on sharing Staff s comments with the technical consultant as part of reviewing
the savings estimates of the current technical reference manual and expressed a willingness to
share any resulting revised estimates with Staff in advance of refiling an application to revise the
Commercial EE Program. Id. The Company also acknowledged Staffs recommendation that
incentive levels should not exceed incremental costs and that the program must demonstrate cost-
effectiveness. Id. The Company sought clarification as to whether cost-effectiveness would be
evaluated at the measure or program level.Id.
Accordingly, the Company recommended that the Commission direct the Company and
Staff to hold one or more workshops to discuss the issues raised in this case prior to re-filing an
application to revise Rate Schedule EE-GS.Id. at 5.
COMMISSION FINDINGS AND DECISION
The Company is a gas corporation under Idaho Code § 61-117, and a public utility under
Idaho Code § 61-129. The Commission has jurisdiction over the issues in this case under Title 61
of the Idaho Code, including Idaho Code §§ 61-301, 501, 502, and 503. Based on our review of
the record, the Commission now issues this Final Order rejecting the Company's proposed
revisions to Rate Schedule EE-GS.
We direct the Company and Staff to hold one or more workshops to discuss proposed
changes to the technical reference manual used to evaluate the Company's Commercial EE
Program. Additionally, the workshops shall include discussions regarding revised estimated
savings, incremental costs, and rebate incentives for the Company's proposed offerings, including
the tankless water heater and storage water heater measures. We instruct the Company to reapply
to revise Rate Schedule EE-GS that considers the information exchanged during the workshop(s).
ORDER
IT IS HEREBY ORDERED that the Company's Application is denied.
IT IS FURTHER ORDERED that the Company and Staff shall hold one or more
workshops to discuss (1)proposed changes to the technical reference manual used to evaluate the
ORDER NO. 37033 6

Company's Commercial EE Program and (2) revised estimated savings, incremental costs, and
rebate incentives for the Company's proposed offerings, including the tankless water heater and
storage water heater measures.
IT IS FURTHER ORDERED that the Company shall reapply to revise Rate Schedule EE-
GS that takes into account the information exchanged during the workshop(s).
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within 21 days of the service date of this Order regarding any matter decided in
this Order.Within seven days after any person has petitioned for reconsideration, any other person
may cross-petition for reconsideration.Idaho Code §§ 61-626.
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 5th day of
May 2026.
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EDWARD LODGE, PR „ DENT
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JO R. HAMMOND JR., COMMISSIONER
DAYN HAKDIE, COMMISSIONER
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Commission Secretary
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ORDER NO. 37033 7