20230905AVU to Staff 1-5.pdf

JURISDICTION:
CASE NO:
REQUESTER:
TYPE:
REQUEST NO.:
REQUEST:
AVISTA CORPORATION
RESPONSE TO REQUEST FOR INFORMATION
IDAHO
AVU-E-23-10
IPUC
Production Request
Staff-01
DATE PREPARED: 09/01/2023
WITNESS: NIA
RESPONDER: Marcus Garbarino
DEPARTMENT: Regulatory Affairs
TELEPHONE: [phone]
EMAIL: [e-mail]
Please explain the difference between the revenue conversion factor from the June Monthly Report
for the Commissioners in the "ID-Sch91 Forecasted-Act Rev" tab, of .99565, and the revenue
conversion factor in the DSM Workpapers provided with the Application in the "Rev Conv Factor"
tab, of .996223.
RESPONSE:
The revenue conversion factor from the June Monthly Report for the Commissioners in the "ID­
Sch91 Forecasted-Act Rev" tab, of .99565, is the revenue conversion factor in effect when the
Company made its last Schedule 91 rate adjustment filing in July 2022 (AVU-E-22-09) and was
included in that tiling's workpapers. That revenue conversion factor was from the Company's last
approved General Rate Case (AVU-E-21-01). The revenue conversion factor in the DSM
Workpapers provided with the Application to this filing in the "Rev Conv Factor" tab, of .996223,
represents the revenue conversion factor included in the Company's approved General Rate Case
(AVU-E-23-01) with an effective date of 9/1 /2023.
RECEIVED
2023 SEPTEMBER 5, 2023 3:57PM
IDAHO PUBLIC
UTILITIES COMMISSION
AVISTA CORPORATION
RESPONSE TO REQUEST FOR INFORMATION
JURISDICTION:
CASE NO:
REQUESTER:
TYPE:
REQUEST NO.:
REQUEST:
IDAHO
A VU-E-23-10
IPUC
Production Request
Staff-02
DA TE PREPARED:
WITNESS:
RESPONDER:
DEPARTMENT:
TELEPHONE:
09/01/2023
NIA
Kim Boynton
Energy Efficiency
[phone]
EMAIL: [e-mail]
Please explain how the Company developed its expense forecasts for this filing.
a. If the Company used the expense forecast provided in the previous rider adjustment, Case
No. AVU-E-22-09, as a basis please describe the factors that the Company adjusted when
updating the forecast; and
b. Please note which factors are driving the reduced expenditures in each August and March
of the forecast period.
RESPONSE:
a. The forecast model provided in this case (AVU-E-23-10) is the same as that previously
used in Case No. AVU-E-22-09, just updated with new data. In particular, A vista's DSM
forecasting model takes in the current DSM balance and extends the previous year's
performance to create a prediction for the upcoming period (in this instance, actuals from
April 2022 to March 2023 were used to inform the forecasting for future years). Additional
factors that impacted the model were updated estimates from the inclusion of midstream,
changes in incentive amounts and estimated changes in program participation.
b. The forecast period is derived from historic actuals extending back one year. Because the
model uses prior year monthly actuals, it is significantly influenced by spikes in program
savings derived from either site-specific projects or program initiation. In the DSM
Workpapers filed with the Application, this phenomenon is clearly demonstrated in the
forecast for expenditures in March 2024, as illustrated in Table 1 below.
2023 2024
End June End January
Expected elec tariff rider revenue $ (417,027)
Expected DSM expenditures $ 391,217
$ (25,810) Net change in balance
Elec Tariff rider balance $ (7,276,862) $ (7,117,150)
Table 1-Snippetfrom Worl.,papers, DSM Balance Tab
End February
$ (359,052)
$ 389,119
$ 30,067
$ (7,087,083)
End March
$ (355,695)
$ 971,006
$ 615,311
$ (6,471 ,772)
The $971,006 forecast for expenditures in March 2024, highlighted above, are directly
influenced by a large lighting project that was completed in March 2023. Similarly, the
forecast provided in Case No. A VU-E-22-09 also shows a large spike in March. That
specific forecast is influenced by a large logging facility upgrade that was completed in
March 2022. Comparing changes in monthly forecasted expenditures between the A VU-
E-22-09 filing and this A VU-E-23-10 filing can result in large discrepancies depending on
what the prior years' actuals within the model were for each filing. The differences in the
August forecast periods are also similarly impacted by prior year actuals.
JURISDICTION:
CASE NO:
REQUESTER:
TYPE:
REQUEST NO.:
REQUEST:
A VISTA CORPORATION
RESPONSE TO REQUEST FOR INFORMATION
IDAHO
A VU-E-23-10
IPUC
Production Request
Staff-03
DA TE PREPARED:
WITNESS:
RESPONDER:
DEPARTMENT:
TELEPHONE:
09/01 /2023
NIA
Kim Boynton
Energy Efficiency
[phone]
EMAIL: kim. [e-mail]
Please explain what measures the Company has taken to mitigate project delays associated with
COVID-19 impacts.
RESPONSE:
As used in this filing, "the residual impacts of the COVID-19 pandemic" 1 represent a series of
market shifts and economic conditions that are not directly related to COVID-19 infections but
rather are factors that first arose as a result of the pandemic in 2020 and subsequent impacts in the
labor market, supply chain, and financial markets. A summary of such impacts includes:
• Sustained supply chain issues, resulting in difficulty obtaining energy efficient equipment,
have caused projects to be delayed, prolonged or canceled.
• Skilled labor shortages for contractors and Community Action Partnership (CAP) agencies
continue to impact the throughput of completed measures.
• Increasing interest rates have hampered or delayed both residential and business
investments in expenditures that are not deemed vital, such as energy efficiency
improvements.
In an attempt to mitigate some of the above referenced impacts and increase participation and
engagement in its energy efficiency programs, A vista launched a Direct Install Commercial
Lighting Program in 2023 to supplement its ongoing customer engagement and energy efficiency
efforts. Partnering Trade Allies receive training and upskilling opportunities in order to effectively
market and deliver the Lighting Program to customers. Through door-to-door and direct mail
marketing, A vista connects customers interested in upgrading their lighting with contractors who
have high-efficiency qualified equipment in stock. By covering nearly 100% of the upgrade costs,
both customers and contractors benefit from participation. Several of the participating Trade Allies
have already added employees to their labor force to keep up with customer demand. The direct
install methodology is effective at boosting local markets by endorsing local businesses and trade
allies.
Additionally, through the Company's continuing Business Partner Program, Avista provides
monetary bonuses to contractors who travel to our rural service territories to bid jobs that might
have otherwise been passed over. In support of this program, A vista proactively reaches out to
rural zip codes to offer the service to customers and matches the customer with a local contractor
to provide the customer with an option for partnership on their efficiency project.
1 Application, pg. 3.
Lastly, the Company has increased the incentive amount for a majority of its prescriptive lighting
measures in 2023 as a way to drive increased project throughput by covering a larger portion of the
customer project cost. Please see Staff-PR-03 Attachment A for a list of these changed incentives.
JURISDICTION:
CASE NO:
REQUESTER:
TYPE:
REQUEST NO.:
REQUEST:
A VISTA CORPORATION
RESPONSE TO REQUEST FOR INFORMATION
IDAHO
A VU-E-23-10
IPUC
Production Request
Staff-04
DA TE PREPARED:
WITNESS:
RESPONDER:
DEPARTMENT:
TELEPHONE:
09/01/2023
NIA
Kim Boynton
Energy Efficiency
[phone]
EMAIL: [e-mail]
Please explain when the Company forecasts the COVID-19 related issues to abate.
RESPONSE:
As outlined in Staff-PR-03, the reference of COVID-19 related issues covers a number of
unprecedented market and economic conditions' impacting energy efficiency programs. With
regards to the forecasted abatement of these issues, the future of many of these market and
economic variables remains unknown. First, it is not anticipated that interest rates will fall to
pre-2020 levels for several years. It is also not known whether contractors or CAP agencies will be
able to attract and retain qualified skilled labor in sufficient quantities to support ongoing energy
efficiency programs. Generally, however, the supply chain issues that plagued much of 2020-2022
have lessened: While A vista is unable to precisely forecast favorable conditions for implementing
energy efficiency programs, the Company has taken steps to mitigate the risks experienced.
An example of such efforts is A vista's recently launched midstream program, which is designed to
encourage distributors to stock high efficiency units so that they are available to contractors who
are competitively bidding projects, thus correcting some of stock issues experienced in recent
years. Additionally, the Company's Direct Install Commercial Lighting Program is making capital
investments in lighting available to businesses that might otherwise have made it a lower priority
or delayed such projects due to increased capital costs.
AVISTA CORPORATION
RESPONSE TO REQUEST FOR INFORMATION
JURISDICTION: IDAHO
AVU-E-23-10
IPUC
DA TE PREPARED: 0910112023
NIA CASE NO: WITNESS:
REQUESTER: RESPONDER: Kim Boynton
TYPE: DEPARTMENT:
REQUEST NO.:
Production Request
Staff-05 TELEPHONE:
Energy Efficiency
[phone]
EMAIL: [e-mail]
REQUEST:
Please explain if the Company has conducted any analysis on the quantity, magnitude, and cause
of project delays since DSM projects resumed operations.
a. If yes, please provide said analysis; and
b. If not, why not.
RESPONSE:
a. NIA.
b. Avista has not performed specific analysis on the quantity, magnitude, and cause of project
delays since DSM projects resumed operations, as DSM projects were never halted [to then
prompt a subsequent resumption]. While the Company intentionally paused Multifamily
Direct Install measures from March 2020 through April 2022 out of an abundance of
caution and safety for our customers as well as employees, the Company continued to
pursue cost effective conservation in every program year -including during that
timeframe, albeit utilizing new avenues to reach customers and perpetuate efficiency
throughput.
As a matter of process, A vista's Account Executives and engineers are assigned to our
largest customers to maintain regular communication and planning for projects. The
Company monitors both the number of projects and the total savings derived from projects
on a monthly basis, in addition to the tariff balance forecast to actuals to ensure that we are
not significantly increasing tariff balance surpluses or deficits. Table 1 below shows the
year over year count of site-specific projects from 2020 through August of2023; at no time
were projects halted. Rather, the Company witnessed project delays and overall program
participation being impacted by the market and economic conditions described in
Staff-PR-03, which has caused conservation savings to lag compared to projections from
the 2021 Conservation Potential Assessment (CPA). Staff-PR-05 Attachment A outlines
the specific savings achieved by program by year, which again shows that while savings
have continued year over year, there has been a noticeable decline in participation for many
programs, such as low-income and the commercial sector.
Total
9
8
7
6
5
4
l I I I I I I I I I I I I I I I I I I I I I
1 3 4 6 7 8 9 1012 1 2 3 4 5 7 8 9 101112 2 3 4 5 6 8 9 1012 1 2 3 4 5 6 7 8
2020 2021 2022 2023
Table 1 -Count of Site Specific Projects, Idaho, 2020-2023
■ Total