20170727AVU to Staff 28.doc

AVISTA CORPORATION
RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 07/25/2017
CASE NO: AVU-E-17-01/AVU-G-17-01 WITNESS: Tara Knox
REQUESTER: IPUC - Morrison RESPONDER: Tara Knox
TYPE: Production Request DEPARTMENT: State & Federal Regulation
REQUEST NO.: Staff-028 TELEPHONE: [phone]

REQUEST:

The Company's electric weather normalization models assume there to be linear relationships between Cooling Degree Days, Heating Degree Days, and Consumption. Did the Company consider incorporating higher order curvature terms in its models? Please explain.

RESPONSE:

Yes, a second set of regressions was prepared with the 2015 dataset that tested for sensitivity to Heating Degree Days squared and Cooling Degree Days squared. A comparison of the empirical test (2015 calendar predicted results versus 2015 per books results) using the higher order terms did not indicate a material improvement in the predictive value of the new models over the accepted methodology that has been used consistently since 2006. Therefore the Company elected not to propose a new methodology in this case.