20080715IPC to Staff 1, 3-11.pdf

~IDA~POR~
An IDACORP Company
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BARTON L. KLINE
Senior Attorney
July 14, 2008
VIA HAND DELIVERY
Jean D. Jewell, Secretary
Idaho Public Utilities Commission
472 West Washington Street
P.O. Box 83720
Boise, Idaho 83720-0074
Re: Case No. IPC-E-08-13
In the Matter of Idaho Power Company's Application for an Accounting Order
Authorizing the Inclusion of Power Supply Expenses Associated with the
Purchase of Capacity and Energy From PPL EnergyPlus, LLC, in the Power
Cost Adjustment
Dear Ms. Jewell:
Enclosed for filing please find an original and three (3) copies of Idaho Power
Company's Response to the First Production Request of the Industrial Customers of Idaho
Power. Please note that Idaho Power Company's Response to Request NO.2 is
confidential and has been printed on yellow paper, marked as confidential, and placed in a
separate envelope.
Upon receipt of this filing, I would appreciate it if you would return a stamped copy of
this letter for my file in the enclosed stamped, self-addressed envelope.ve(!~
Barton L. Kline
BLK:csb
Enclosures
P.O. Box 70(83707)
1221 W. Idaho St.
Boise. ID 83702
BARTON L. KLINE (ISB No. 1526)
DONOVAN E. WALKER (ISB No. 5921)
Idaho Power Company
P.O. Box 70
Boise, Idaho 83707
Telephone: [phone]
Facsimile: 208-338-6936
bklinetâidahopower.com
dwalkertâidahopower.com
Attorneys for Idaho Power Company
Street Address for Express Mail:
1221 West Idaho Street
Boise, Idaho 83702
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF IDAHO POWER )
COMPANY'S APPLICATION FOR AN ) CASE NO. IPC-E-08-13
ACCOUNTING ORDER AUTHORIZING )
THE INCLUSION OF POWER SUPPLY ) IDAHO POWER COMPANY'S
EXPENSES ASSOCIATED WITH THE ) RESPONSE TO THE FIRST
PURCHASE OF CAPACITY AND ENERGY ) PRODUCTION REQUEST OF THE
FROM PPL ENERGYPLUS, LLC, IN THE ) INDUSTRIAL CUSTOMERS OF
POWER COST ADJUSTMENT. ) IDAHO POWER
)
COMES NOW, Idaho Power Company ("Idaho Power" or "the Company"), and in
response to the First Production Request of the Industrial Customers of Idaho Power
Company dated July 3, 2008, herewith submits the following information:
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 1
REQUEST FOR PRDUCTION NO.1: Please provide a copy of all materials,
information, documents, or any other item, in both hardcopy and digital format,
requested by the Commission Staff in the present case, No. IPC-E08-13.
RESPONSE TO REQUEST FOR PRODUCTION NO.1: The requested
information is enclosed.
This response to this Request was prepared by Barton L. Kline, Senior Attorney,
Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 2
REQUEST FOR PRODUCTION NO.3: Please provide all workpapers, analysis,
inputs, and documents used to forecast the predicted peak-hour reductions attributable
to the A1C Cool Credit and Irrigation Peak Rewards programs referred to on page 11,
lines 8-16 of Mr. Bokenkamp's direct testimony.
RESPONSE TO REQUEST FOR PRODUCTION NO.3: The peak-hour
reductions attributable to the A1C Cool Credit and Irrigation Peak Rewards programs are
calculated using data supplied by a third part consultant firm that provided services for
both of these programs. Summit Blue consulting analyzed the A1C Cool Credit program
in 2003, 2004, and 2006. Summit Blue's most current report shows a 1.12 kW savings
per participant at a 50% cycling rate. The 2006 report is the most applicable because of
changes in the technology of the switches used in this program. Attached is a copy of
their most recent analysis. Summit Blue's work on the Irrigation Peak Rewards program
and the method Idaho Power uses to determine peak-hour reduction for this program is
described in the 2007 Irrigation Peak Rewards Program Report filed with the Idaho
Public Utilities Commission on December 1, 2007, on pages 8-13. A copy of this report
is attached.
This response to this Request was prepared by Karl Bokenkamp, General
Manager, Power Supply Operations and Planning, Idaho Power Company, and Pete
Pengily, Leader, Customer Research and Analysis, Idaho Power Company, in
consultation with Barton L. Kline, Senior Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 4
REQUEST FOR PRODUCTION NO.4: Please provide the kW and kWh savings
and the cost per kW and kWh attributable to Idaho Power's A1C Cool Credit Program
referred to on pages 10-11 of Mr. Bokenkamp's direct testimony.
RESPONSE TO REQUEST FOR PRODUCTION NO.4: This Request
inaccurately characterizes Mr. Bokenkamp's testimony and requests information that is
beyond the scope of Mr. Bokenkamp's testimony. Nevertheless, in an effort to be
cooperative, the Company hereby states as follows:
Demand Response programs such as the A1C Cool Credit program are targeted
at decreasing peak usage and are not expected to reduce energy (kWh) usage.
Appendix 3 of the Demand-Side-Management 2007 Annual Report states the estimated
summer peak demand savings attributable to the A1C Cool Credit program to be 10,762
kW. Idaho Power does not claim any energy (kWh) saving for its demand response
programs. As stated in the Demand-Side-Management 2007 Annual Report under the
Demand Impact heading of the A1C Cool Credit section on page 13: "Although cycling
appears to shift some usage from the cycling hours to no-cycling hours, the net effect
on KWh usage is negligible." The levelized costs for the kW reduction attributed to the
A1C Cool Credit program based on the utility cost and summer peak demand savings
reported in the Demand-Side-Management 2007 Annual Report and using the financial
factors from the Technical Appendix of the 2006 Integrated Resource Plan is calculated
to be $27.38 per kW/year.
This response to this Request was prepared by Karl Bokenkamp, General
Manager, Power Supply Operations and Planning, Idaho Power Company, and Pete
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 5
Pengily, Leader, Customer Research and Analysis, Idaho Power Company, in
consultation with Barton L. Kline, Senior Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 6
REQUEST FOR PRODUCTION NO.5: Please provide all workpapers, analysis,
inputs, documents, and forcasts used in comparing the costs of the PPA with other
available DSM options as discussed on page 10, line 7 through page 11, line 19 of Mr.
Bokenkamp's direct testimony.
RESPONSE TO REQUEST FOR PRODUCTION NO.5: This Request
inaccurately characterizes Mr. Bokenkamp's testimony and requests information that is
beyond the scope of Mr. Bokenkamp's testimony. Nevertheless, in an effort to be
cooperative, the Company hereby states as follows:
Most of Idaho Power's energy effciency and demand response programs were
identified and selected through the IRP process. Additional information on these
programs is included on pages 56-59 of the 2004 IRP, in the DSM section of the 2004
IRP Technical Appendix, on pages 63-70 of the 2006 IRP, and on pages 62-73 of the
20061RP Technical Appendix.
This response to this Request was prepared by Karl Bokenkamp, General
Manager, Power Supply Operations and Planning, Idaho Power Company, in
consultation with Barton L. Kline, Senior Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 7
REQUEST FOR PRODUCTION NO.6: Please provide a copy of each annual
DSM report to the Commission from 2003 through 2007 as referenæd on page 10, lines
19-24 of Mr. Bokenkamp's direct testimony.
RESPONSE TO REQUEST FOR PRODUCTION NO.6: Copies of the
requested information have been provided to Mr. Richardson. Because of the volume
of the information and because these reports have all been filed with the Commission,
the Company requests that the Commission take administrative notiæ of the DSM
reports. The Company requests that the Commission and Mr. Woodbury utilize the
copies previously lodged with the Commission if the Commission desires to review the
DSM reports.
This response to this Request was prepared by Barton L. Kline, Senior Attorney,
Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 8
REQUEST FOR PRODUCTION NO.7: Please provide a detailed accounting of
the effect to Idaho Power's Power Cost Adjustment by the addition of the costs incurred
by the PPA.
RESPONSE TO REQUEST FOR PRODUCTION NO.7: Idaho Power objects to
Request for Production NO.7 on the grounds that it is vague, speculative, burdensome,
and is not likely to lead to the discovery of relevant evidence. Idaho Powets Power
Cost Adjustment is determined based on numerous variables and assumptions,
principally forecasts of hydroelectric conditions, market prices, and loads. The PPL
EnergyPlus contract commences in 2010. Therefore, to determine the PCA impact of
the PPL EnergyPlus contract in 2010 would require speculation as to each of these
variables.
This response to this Request was prepared by Greg Said, Manger, Revenue
Requirement, Idaho Power Company, and Karl Bokenkamp, General Manager, Power
Supply Operations and Planning, Idaho Power Company, in consultation with Barton L.
Kline, Senior Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 9
REQUEST FOR PRODUCTION NO.8: Please provide all workpapers, analysis,
inputs, and documents used to determine that the PPA costs are competitive and
favorable to alternative resource options as discussed on page 7, lines 2-4 of Mr.
Bokenkamp's direct testimony.
RESPONSE TO REQUEST FOR PRODUCTION NO.8: Idaho Power and PPL
EnergyPlus established the price under the PPA which is the subject of this proæeding
on May 28, 2008. On page seven of his testimony, Mr. Bokenkamp provided the
forward prices for both the Mid-Columbia and Palo Verde hubs on that day for energy to
be delivered during June, June, and August of 2010 and 2011. These forward prices do
not include the costs for transmission services or losses which would further increase
the cost of these forward purchases.
In addition, Idaho Power conducted a competitive solicitation in which PPL
EnergyPlus was the successful bidder. Copies of the bids and materials associated
with the bidding process, as well as the forward prices referred to earlier in this
response, have been provided in Response to Production Request NO.1.
This response to this Request was prepared by Karl Bokenkamp, General
Manager, Power Supply Operations and Planning, Idaho Power Company, in
consultation with Barton L. Kline, Senior Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER -10
REQUEST FOR PRODUCTION NO.9: Please provide an explanation that
reconciles this PPA with Idaho Power's current IRP.
RESPONSE TO REQUEST FOR PRODUCTION NO.9: The PPL EnergyPlus
contract replaæs the current PPL Montana contract which expires in 2009. The
Company's 2008 IRP Update includes the existing PPL Montana contract, and it
contemplates continued renewal of this or a similar PPA using the transmission capacity
which wil be used to deliver the energy to be acquired from PPL EnergyPlus. This
transmission capacity is currently being used by the PPL Montana contract and the
2006 IRP and 2008 IRP update both contemplate continuing purchases over that
transmission path. See pages 93 through 112 of the Company's 2008 Integrated
Resource Plan Update.
This response to this Request was prepared by Karl Bokenkamp, General
Manager, Power Supply Operations and Planning, Idaho Power Company, in
consultation with Barton L. Kline, Senior Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER- 11
REQUEST FOR PRODUCTION NO.1 0: Please identify the location of this new
resouræ represented by the PPA in Idaho Power's transmission queue.
RESPONSE TO REQUEST FOR PRODUCTION NO. 10: Several years ago
Idaho Power purchased rights to long-term, point-to-point service over the transmission
path which wil be used to integrate the purchase from PPL EnergyPlus onto the
Company's system. Idaho Powets OASIS transmission queue shows that Power
Supply's most recent renewal request for 87 MW of long-term yearly firm, point-to-point
transmission rights from Jefferson to IPCO system, from July 2006 through June 2010,
were queued in April of 2006. Because Power Supply is currently holding these long-
term yearly firm transmission rights, Power Supply has rollover rights that permit it to
renew these transmission rights.
This response to this Request was prepared by Karl Bokenkamp, General
Manager, Power Supply Operations and Planning, Idaho Power Company, in
consultation with Barton L. Kline, Senior Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER- 12
REQUEST FOR PRODUCTION NO. 11: Please describe the how this new
resource wil be delivered to Idaho Power's load center under the terms of the
settlement agreement in Docket No. IPC-E-06-21.
RESPONSE TO REQUEST FOR PRODUCTION NO. 11: As described in
Response to Request No. 10, Idaho Power wil use its previously acquired long-term,
point-to-point transmission capacity purchase to integrate the energy acquired under the
PPL EnergyPlus contract. The PPL EnergyPlus contract wil replace the PPL Montana
contract. As a result, no new transmission capacity needs to be constructed to
accommodate the energy from PPL EnergyPlus. Consequently, there is no valid
comparison to the situation the Commission addressed in Docket No. IPC-E-06-21 in
which transmission capacity must be constructed to accommodate the resources
proposed to be developed in the Twin Falls area.
This response to this Request was prepared by Karl Bokenkamp, General
Manager, Power Supply Operations and Planning, Idaho Power Company, in
consultation with Barton L. Kline, Senior Attorney, Idaho Power Company.
\.'"
DATED at Boise, Idaho, this 14 day of July 2008.
~tL
Attorney for Idaho Power Company
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER- 13
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on this 14th day of July, 2008, I served a true and
correct copy of the within and foregoing document upon the following named parties by
the method indicated below, and addressed to the following:
Commission Staff --Hand Delivered
U.S. Mail
_ Overnight Mail
FAX
_ Email Scott.woodbury((puc.idaho.gov
Scott Woodbury
Deputy Attorney General
Idaho Public Utilties Commission
4 72 West Washington (83702)
P.O. Box 83720
Boise, Idaho 83720-0074
Industrial Customers of Idaho Power
Peter J. Richardson, Esq.
Richardson & O'Leary PLLC
515 North 27th Street
P.O. Box 7218
Boise, Idaho 83702
-- Hand Delivered
U.S. Mail
_ Overnight Mail
FAX
_ Email petertârichardsonandoleary.com
Dr. Don Reading
Ben Johnson Associates
6070 Hil Road
Boise, Idaho 83703
Hand Delivered
-- U.S. Mail
_ Overnight Mail
FAX
Email dreading((mindspring.com
iCC
Barton L. Kline
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER- 14
BEFORE THE
IDAHO PUBLIC UTiliTIES COMMISSION
CASE NO. IPC-E-08-13
IDAHO POWER COMPANY
RESPONSE TO REQUEST NO.3
SUMMIT BLUE
CON S U L TIN G, L L C
LOAD REDUCTION ANALYSIS OF THE
2006 Air Conditioning Cool Credit Program
Final Report
Prepared for
Idaho Power Company
June 15, 2007
Summit Blue Consulting
Boulder, Colorado
Phone [phone]
CONTENTS
Executive Summary................................................................................................... E-1
1 Introduction
1.1 Background ........... ............................................................................................ 1-1
1.2 Objectives of the Assignment......................................................................... 1-2
2 Load Reduction Analysis
2.1 Load Impacts..................................................................... ................................2-1
2.2 Conclusions and Recommendations...................................................... 2-4
Summit Blue Consulting 2006 Idaho Power AlC Cool Credit Final Report
E EXECUTIVE SUMMARY
On March 17,2003, the Idaho Public Utilities Commission approved Idaho Power Company's
(IPCo's) request to conduct a residential air conditioning cycling program to test potential
summer peak load reduction over two summer seasons: 2003 and 2004. The 2003 and 2004
programs were analyzed by Summit Blue Consulting. In 2005, the air conditioning cycling
program entered a new phase as a large-scale program with a new name (A/C Cool Credit), new
subcontractors, some new equipment, and new processes and procedur.es designed to integrate
this program into existing departments and services. This report presents the results of the load
reduction analysis of the AlC Cool Credit Program (the "Program") for the summer of2006.
The purpose of this evaluation was to estimate the load reduction associated with AlC cycling
and determine the difference, if any, ofthe impact from cycling via power line carrier
communications in the AMR system relative to cycling switches using a radio paging system
Like the analyses ofthe summer 2003 and 2004 pilot program and the 2005 full program, this
analysis used statistical modeling approaches that related metered electricity usage to weather
conditions and the cycling event.
This load reduction analysis finds that the Program does indeed produce substantive and
measurable effect on AlC load during cycling periods, specifically:
. 50% cycling produced 1.12 kW load reduction per hour for each participant.
. 67% or more cycling produced 1.51 kW load reduction per hour for each participant.
. The 5200 switch produced slightly more savings than the 5000 switch.
Summit Blue Consulting 2006 ipca AlC Cool Credit Final Report E-1
1 INTRODUCTION
This report presents the results of the load reduction
analysis ofIdaho Power Company's (IPCo's) AlC
Cool Credit Program (the "Program") for the
summer of2005.
1.1 Background on
1.2 Objectives of the
Assignment
In this chapter, Section 1.1 contains a brief overview of the Program; Section 1.2 presents the
objectives of this evaluation.
1.1 Background
On March 17,2003, the Idaho Public Utilities Commission approved IPCo's request to conduct
an air conditioning cycling program to test potential summer peak load reduction over two
summer seasons: 2003 and 2004. The 2003 and 2004 programs were analyzed by Summit Blue
Consulting. The air conditioning cycling program entered a new phase in 2005 as a large-scale
program with a new name, new subcontractors, some new equipment, and new processes and
procedures designed to integrate this program into existing departents and services.
During the summer of 2006, there were approximately 70 hours of cycling from June to August
over 20 events. Exhibit 1-1 presents the date and time of these cycling events. In two of these
events, the participants were cycled for 67% or more during a given hour (i.e., 20 minutes off
during each half-hour of the control period). Two other events cycled participants for 33%. The
remaining control days cycled participants for 50% during a given half-hour. Almost all events
started at 15:00, and a majority lasted for four hours.
Summit Blue Consulting 2006 ipca AlC Cool Credit Final Report 1-1
06/13/06 15:00 4 50%
06/14/06 10:36 8 minutes 50%
06/21/06 10:59 30 minutes 50%
06/22/06 15:00 4 50%
06/23/06 15:00 4 50%
06/26/06 15:00 4 50%
06/28/06 15:00 4 50%
06/29/06 15:00 4 50%
07/10/06 15:00 3.5 66%
07/11/06 15:00 4 50%
07/12/06 15:00 4 50%
07/17/06 16:00 9 minutes 100%
07/17/06 16:29 2.5 33%
07/18/06 09:27 2.8 50%
07/18/06 15:00 4 50%
07/20/06 15:00 4 50%
07/24/06 15:00 4 50%
07/25/06 15:00 4 33%
07/26/06 17:24 10 minutes 100%
08/10/06 15:00 4 50%
08/14/06 15:00 4 50%
07/12/06 15:00 4 50%
Total 69.9
1.2 Objectives of the Assignment
The focus ofthis evaluation was to conduct a load reduction analysis ("LRA") ofthe Program
during the summer of2006. The purpose of the analysis was to address the following issues:
. What effect did cycling have on reducing and/or shifting load?
. Is there a difference between the impacts of cycling via power line carrier
communications in the AMR system relative to cycling switches using a radio paging
system?
To address these issues, the LRA used the following data:
. Interval whole.,house metering data (using load research meters)
· End-use (Air Conditioner) demand meter data
. Air Conditioner run time information from loggers.
. Records of cycling dates, intervals, and duration (Exhibit 1-1).
Summit Blue Consulting 2006 ipca AlC Cool Credit Final Report 1-2
2 LOAD REDUCTION ANALYSIS
This chapter presents the results of the load
reduction analysis of the AIC Cool Credit Program.
2.1 Load Impacts
2.2 Conclusions and
Recommendations
2.1 Load Impacts
The simplest approach to determining impacts of a cycling day to the average load curve on a
similar non-cycling day and AlC cycling program is to compare the average load curve on the
cycling day to the average load curve on a similar non-cycling day. One problem with this
method is that it may be difficult to obtain a non-cycling day that matches the conditions of the
cycling day. In addition, this straightforward sampling approach using a sample of interval
meters is unlikely to produce high levels of accuracy. Instead, a slightly more sophisticated
approach is needed to produce levels of precision on which capacity and energy payments can be
justified. This is where the increase in precision of the fixed-effect model used in this analysis is
superior to other approaches.
As an ilustration, suppose a recent evaluation of a direct load control program for air
conditioners in the Western United States produced a mean impact estimate ofO.71kW per
participant. There were a total of 600 participants in the program and metered data were obtained
on a sample of 50 participating customers. The standard deviation for this sample was 1.01 kW.
The reason the standard deviation is so large is that approximately 35 percent ofthe participants
had zero or minimal impacts from the program on control days, i.e., their AC unit was shut off
on that day, either because they were on vacation or because they were "free-riders" and
typically turned off their AC units during the day. The number of participants with near zero
impacts results in a bimodal distribution with a large variance and standard deviation for the
sample.
A 90 percent confidence interval with a standard deviation of 1.01 yields a confidence interval of
+1- .24 kW or +1- 34 percent using the representative day approach calibrated to same day loads
and temperatures. This level of precision is common for this method and is generally accepted in
regulatory proceedings, but in some cases additional accuracy can be important. For example, if
the load impacts were part of a DR program with a regional reliability organization, it may not be
quite accurate enough for a settlement agent or to create a viable hedge product that can be used
as a tradable product in bilateral or even internal corporate transactions for capacity and reserves.
SHC's preferred approach is to directly model kW load, rather than relying upon simple or
calibrated representative day comparisons, or on approaches that model duty cycles as a stand-
alone estimation method. In this approach, the measured hourly kW load is the dependent
Summit Blue Consulting 2006 ipca AlC Cool Credit Final Report 2-1
variable in a regression equation that includes weather terms, household demographics,
appliance holding, and the cycling event. In essence, a structural model ofthe AlC load is
developed. The impact of the cycling is simply the coefficient on the cycling variable. This
approach is intuitively appealing, and has produced very precise estimates of program effects.
This analysis further refines this approach by using pooled time-series and cross-sectional data
(panel data). That is, all hourly observations over the summer for all households are combined
into the one modeL. In order to capture differences across households, the model includes a
constant term that is specific to each household (termed a fixed-effects model). This constant
term captures the effect on hourly AlC load of all the variables that do not change over time.
Thus, this model indirectly controls for such things as the orientation of the house, the size ofthe
house, and the characteristics of the Ale.
The first question addressed by this analysis is what effect cycling has on the load shape of
participating households. Exhibit 2-1 graphs the average load shape across all participants for
the warmest cycling day in July to the nearest non-cycling day (which while it was warmer at the
peak, it was actually cooler overall). Clearly, the program does affect the average load shape,
with a drop in consumption during the cycling period.
Exhibit 2-1: Average cycling load shape vs. non-cycling load shape
Control versus Non-Control Day
3.5
3
5 2.5o:i~ 2;i
& 1.5
l!
~
- July 21 2006 (no cycling)
- July 24 2006 (50% cycling)
0.5
o ~ ~ ~ ~ ~~~~~~~~
Hour of Day
In order to quantify the impacts of the Program, a fixed-effect panel data model was used that
combined weather data with the interval meter data. For this analysis, data are available both
across households (i.e., cross-sectional) and over time (i.e., time-series). The fixed effects model
can be viewed as a type of differencing model in which all characteristics ofthe home, which (1)
are independent of time and (2) determine the level of hourly electricity use, are captured within
the house-specific constant terms. In other words, differences in housing characteristics that
cause variation in the level of energy consumption, such as building size and structure, are
captured by constant terms representing each unique house.
Summit Blue Consulting 2006 ipea AlC Cool Credit Final Report 2-2
Algebraically, the fixed-effect panel data model is described as follows:
Yit = a¡ + ßxit + Sit'
where:
Yit C energy consumption for home i during hour t
a¡ constant term for home i
ß vector of coefficients
Xit vector of variables that represent factors causing changes in AC consumption for
home i during hour t (i.e., weather and control strategies)
Sit = error term for home i during hour t.
This hourly demand model was estimated over all metered participants during the months of
June through August. Exhibit 2-2 presents the estimated panel model used to determine the effect
on hourly kW usage associated with AlC cycling. The weather variables include the current
hour's temperature and humidity. The model also uses indicators for afternoon (lpm to 8 pm) to
capture general daily usage patterns.
Exhibit 2-2: Load Impacts Model- dependent variable is hourly kW usage, June through
Au ust2006-
I ndcpcndcnt Variable Coeffcient t-\ alue
(t-value
Cycling at 50%-1.12 -27.1
Cycling at 67% or more - 1.51 -15.3
5200 Switch -0.20 -3.3
Current hour's temperature 0.09 85.0
Current hour's humidity 0.01 12.1
Sample Size 67,966(85 sites)
R-squared
Ignoring individual constants 18%
With individual constants 43%
The coefficients on the control hour variables indicate the kW savings per hour associated with
the program at different cycling levels. The t-values on most of these variables show that the
results are statistically significant at the 95% confidence leveL. At the 50% level, the program
caused a 1.12 kW reduction in demand, and at 67% or higher cycling, the program causes a 1.51
Summit Blue Consulting 2006 ipca AlC Cool Credit Final Report 2-3
kW reduction in electricity demand. Both of these results are statistically significant. This table
also shows that the 5200 switch also produces 0.2 kW more savings than the 5000 switch.
2.2 Conclusions and Recommendations
In conclusion, this load reduction analysis ofIPCo's AlC Cool Credit Program for the summer of
2006 has shown the following:
. The Program does produce substantive and measurable effect on AIC load during cycling
periods, with 1.12 kW load reduction per participant for 50% cycling and 1.52 kW
reduction for 67% or more cycling.
. The 5200 switch was slightly more effective than the 5000 switch; producing an additional
0.2 kW load reduction per participant over the 5000 switch (this result is statistically
significant).
Summit Blue Consulting 2006 ipca AlC Cool Credit Final Report 2-4
~IDA~POR~t
An I DACORP company
Irrigation Peak Rewards
Program Report
December 1, 2007
Table of Contents
EXECUTIVE SUMMARy.................................................................... 2
Summary of Results......................................................................... 3
Conclusions...................................................................................... 4
REVIEW OF PARTICIPATION, OPERATIONS, AND LOAD
REDUCTION...................................................................................... 5
Map 1.
Table 1.
Table 2.
Table 3.
Table 4.
Table 5.
Table 6.
Table 7.
Table 8.
Graph 1.
Graph 2.
Graph 3.
Graph 4.
List of Maps
Idaho Power service territory and regions...............................................................5
List of Tables
Service points by area ................................................................................................6
Service point interruption option distribution .........................................................7
Equipment problem resolution..................................................................................8
Realization rates by period ........................................................................................9
Enrolled load by area................................................................................................10
Average MW reduction utilzing realization rates by period ................................11
Program costs...........................................................................................................14
Benefit-cost model input..........................................................................................15
List of Graphs
Participant distribution in each area............................................................,............6
Average metered demand (kW) ...............................................................................12
Average metered demand (kW) 2nd half of June....................................................12
Demand impact on Company system load ............................................................13
2007 Irrigation Peak Rewards Report Page 1
EXECUTIVE SUMMARY
The Irrigation Peak Rewards Program (lithe Program") is a voluntary demand
response program available to Idaho Power's agricultural irrigation customers
since 2004. The Program is designed to reduce peak load by turning off
participating irrigation pumps during peak demand hours through the irrigation
season in return for a financial incentive. Through this Program, the Company
has been successful in reducing load during the summer afternoon hours when
overall costs to provide energy are typically higher.
On September 18, 2006, Idaho Power (lithe Company") filed with the Idaho
Public Utilities Commission (lithe Commission") a request for authorization to
implement certain changes to the Program to improve participation. The first
proposed change was to increase the demand credits offered to participating
customers. Second, the Company proposed to allow more customers to
participate by decreasing the pump horsepower ("hp") limit from 1 00 hp to 75. On
November 30, 2006 the Commission approved the proposed changes through
Order No. 30194 and subsequently, the Company implemented the changes
during the 2007 irrigation season. The Commission's Order No. 30194 directed
the Company to file a report annually on December 1 for three years. This report
is to provide the Commission with the 2007 results of the Irrigation Peak
Rewards Program, and is filed in compliance with Order No. 30194.
The Program enrollment for 2007 was 947 service points across five geographic
regions of the Company's Idaho and Oregon service territories. Within these five
regions, there were 4,052 eligible metered service points with at least 100
cumulative hp. Another 800 service points were eligible with pumps ranging from
75-99 cumulative hp, with 75 hp being the minimum amount eligible under the
Program. Approximately 1,360 customers operated the 4,852 eligible service
points.
The 2004 Integrated Resource Plan ("IRP") set an initial load reduction target for
the Program of 30 MW. The 2006 changes to the Program were estimated to
achieve an additional 4.5 MW load reduction for a total of 34.5 MW at the
generation level, which is adjusted for line losses. At the customer level this
equates to an overall load reduction of 30.5 MW, which removes line losses. The
peak reduction numbers reported throughout the remainder of this report are
presented at the customer level.
2007 Irrigation Peak Rewards Report Page 2
The Program utilizes pre-programmed, electronic, time-activated switches to turn
off pumps of participating irrigation customers during predetermined intervals in
exchange for a financial incentive. Customers can choose to participate one, two,
or three weekdays per week during the months of June, July, and August. The
following are the interruption options (reported in Mountain Standard Time)
available to customers with the corresponding incentive amounts:
. One weekday per week, 4 p.m. to 8 p.m.
. Two weekdays per week, 4 p.m. to 8 p.m.
. Three weekdays per week, 4 p.m. to 8 p.m.
$2.01 per kW Demand
$3.36 per kW Demand
$4.36 per kW Demand
The monthly incentive amount credited to customers was calculated for each
metered service point by multiplying the monthly biling demand for the months of
June, July, and August by the corresponding incentive amount based on the
interruption option selected by the customer.
Throughout 2007, the Company continued to share Program information and
progress with the Energy Effciency Advisory Group ("EEAG") members through
program updates. Members of EEAG represent a cross-section of customer
interests including residential, industrial, commercial and agriculturaL. In 2007,
EEAG membership also included Company representation, Commission Staff
members and a representative from the Idaho Irrigation Pumpers Association.
Summary of Results
The following items summarize the key results of the Program on a system-wide
basis:
1: In 2007 the Program achieved a maximum peak load reduction of 37.4
MW.
1: Two hundred fift-seven (257) customers, or 19% of the 1,360 eligible
customers, chose to participate in the Program.
1: Nine hundred forty-seven (947), or 20%, of the 4,852 eligible metered
service points were enrolled in the Program.
1: Of the 947 enrolled service points, fifty-five (55) were pumps with 75-99
hp. All other enrolled pumps were 100 hp or greater.
1: The Program achieved a total billing demand enrollment of 182,499 kW.
The total billng demand is the sum of the maximum billng demand from
the previous irrigation season for each service point.
1: The Program produces substantial and measurable impacts on peak
demand. The total load reduction from 4-8 p.m. associated with the
2007 Irrigation Peak Rewards Report Page 3
Program averaged 30.5 MW in June, 32.8 MW in July, and 23.5 MW in
August.
¡: The Program costs as of September 30,2007 were $1,591,374.
¡: The Program results show a 30 year average benefit cost (B/C) ratio of
1.10.
Conclusions
¡: The Company plans to continue the Program because it is a cost-effective
way to reduce customer demand at the optimal time of day.
¡: Changes to the Program implemented in 2007 increased the number of
participants and helped the Company to achieve its 2004 Integrated
Resource Plan (IRP) targets for peak load reduction.
¡: The Program achieved a maximum peak load reduction that occurred
during the last two weeks in June of 37.4 MW at the customer leveL. The
average peak reduction in July was 32.8 MW. The Program had a target
load reduction of 30.5 MWat the customer leveL.
2007 Irrigation Peak Rewards Report Page 4
REVIEW OF PARTICIPATION, OPERATIONS, AND LOAD REDUCTION
1. Participation
Informational letters were mailed in February of 2007 to eligible customers. The
letters were the primary method of marketing the Program. Each customer letter
included a Program explanation, the Program's incentive structure, a listing of the
customer's eligible service points, and a Program application. In addition, a follow
up telephone call was made in March 2007 to all prior Program participants that
had not yet sent in their application. Significant effort, including customer visits,
was made to enroll as many customers as possible.
Map 1 portrays Idaho Power's service territory divided into five regional areas
("region"). The regions are titled Western, Canyon, Capital, Southern, and
Eastern. These regions wil be used throughout this report referring to Program
information.
Map 1. Idaho Power service territory and regions.
2007 Irrigation Peak Rewards Report Page 5
Graph 1 represents the distribution of Program participants by area.
Graph 1. Distribution of Participants.
Program Participation by Area
Eastern
53%
Western
3%
Southern
35%
Table1 lists the total number of eligible service points and the participation levels
by area.
Table 1. Service points by area.
ELIGIBLE SERVICE ENROLLED
IDAHO POWER SERVICE POINTS PECENTAGE
REGION POINTS ENROLLED BY AREA
Western 215 28 13.0%
Canyon 343 27 7.9%
Capital 500 59 11.8%
Twin Falls 1197 121 10.1%
Southern
Mini-Cassia 1036 212 20.5%
Eastern 1561 500 32.0%
TOTAL SERVICE 4,852 947 19.5%POINTS
2007 Irrigation Peak Rewards Report Page 6
Table 2 compares how the participating service points were distributed across
the Company's service territory, along with the interruption options for each area.
Table 2. Service point interruption option distribution.
INTERRUPT INTERRUPT INTERRUPT
OPTION 1 OPTION 2 OPTION 3
IDAHO POWER 1 2 3
REGION DayslWeek DayslWeek DayslWeek TOTAL
Western 17 2 9 28
Canyon 17 3 7 27
Capital 38 7 14 59
Twin Falls 39 32 50 121
Southern
Mini-Cassia 152 30 30 212
Eastern 226 147 127 500
TOTAL SERVICE POINTS 489 221 237 947
2. Program Opt-out
During the 2007 irrigation season, ten (10) service points were removed from
Program participation after June 1 due to various unforeseen circumstances by
customers. Under the Program, if a service point is taken out of the Program
after June 1, the participant is assessed a fee of $100. This resulted in a total of
$1,000 which was credited to the Energy Effciency Rider funding account to
offset the initial Program costs.
3. Interruption Failures
Electronic timers manufactured by Grasslin Controls Corp. (Model GMX-891-0-
24) were used to interrupt power to the customers' pumps during the interruption
period. The timers were installed in the pump motor control circuit to prevent the
pump from running during the interruption period. In order to meet the load
reduction targets of the Program, the Company tries to minimize interruption
failures. However, there were a small number of interruption failures discovered
in 2007. In most cases the failures were corrected quickly with little or no impact
to Program performance.
Most of the electronic timers operated without incident with less than three
percent of participants requesting a follow-up visit. The timer issues requiring a
follow-up visit are detailed in Table 3.
2007 Irrigation Peak Rewards Report Page 7
Table 3 lists the types of problems resolved by either Company personnel or the
contracted electricians.
Table 3. Known equipment problem resolutions.
ISSUE QUANTITY
Faulty time clock 11
Electrician troubleshooting calls 36
TOTAL 47
While each of the known timer related problems detailed in Table 3 were
resolved in a timely manner, a review of the Company's load research meter data
revealed that there were a number of failures that went undetected for the entire
irrigation season. Sixt-three (63) load research meters are distributed among
the 947 participating service points in order to study the usage patterns of the
customers and the load impact of the Program. The data showed that 94% of the
load research meters recorded successful interruptions throughout the 2007
Program year with 6% failing to record a single interruption during the Program
year. The interruption failures are evident in the load reduction graphs provided
in this report. Upon further investigation, it was found that these failures were due
to various mechanical problems. The Company continues to address this issue
through monitoring of load research data along with an increased number of site
visits for electronic timer inspections.
4. Load Reduction Achieved
The Program load reduction impacts were determined by utilizing information and
conclusions from the impact evaluation conducted in 2004 by Summit Blue
Consulting, LLC. This evaluation utilized load research meter data for both
Program participants and non-participants. This information was used in a
regression analysis to develop a statistical kW load modeL. The model
considered weather conditions, time of day, day of week, and month in
determining realization rates for six 2-week periods during the course of the
irrigation season. The Company has utilized these realization rates since the
2005 season.
The realization rate is defined as the likelihood an irrigation service point is
operating during the interrupt period, and provides a clear picture of actual
program impacts. The realization rate can be characterized as simply the
percentage of monthly billng demand that is expected to result in an actual load
reduction on the system during a given interruption period. The realization rate is
highest at the end of June and the beginning of July when most irrigation pumps
are operating nearly 24 hours-a-day, 7 days-a-week. The realization rate is lower
later in the irrigation season when irrigation pumps are turned off due to crop
maturity.
2007 Irrigation Peak Rewards Report Page 8
Table 4 shows the Program evaluation results from the Summit Blue impact
analysis for each of the six 2-week time periods. The highest realization rate
occurred during the second half of June, with a realization rate of 64%. The
lowest realization rate occurred during the second half of August, with a
realization rate of 32%. The average total realization rate is 50%. These
realization rates were used to calculate the program load reduction for this year.
The Company verified the realization rates prepared by Summit Blue for this
report using 2007 load research data. Based on past and current analysis of load
research data, the Company was able to reproduce an overall realization rate
within approximately 2% of the Summit Blue analysis results. Therefore, the
Company believes the realization rates from the Summit Blue analysis continue
to be a reliable and accurate means to estimate the Program's load reduction.
Idaho Power does not propose any changes to the realization rates at this time,
but will continue to review the realization rates in the future.
Table 4. Realization rates by period.
Idaho Power
PERIOD Realization Rate
1 st half of June 41%
2nd half of June 64%
1 st half of July 60%
2nd half of July 53%
1 st half of August 49%
2nd half of August 32%
AVERAGE 50%
The Company attempts to distribute the enrolled kW evenly throughout each
weekday. However, due to service point size variability, enrollment requests by
customers, and enrollment opt-outs, etc., the load cannot be exactly balanced.
The peak billing demand data for the months of June, July, and August 2007
were used to estimate the amount of load enrolled in the Program. The total
billng demand enrolled in the Program was 182,499 kW. Table 5 shows how the
enrolled load was distributed by region.
2007 Irrigation Peak Rewards Report Page 9
Table 5. Enrolled load by area.
ENROLLED BILLING DEMAND KW* BY REGION
IDAHO POWER REGION 1 2 3 TOTALDayslWeekDayslWeekDayslWeek
Western 8,739 194 684 9,617
Canyon 2,276 327 497 3,100
Capital 14,749 805 1,985 17,539
Twin Falls 9,748 4,757 7,958 22,463
Southern
Mini-Cassia 34,121 7,019 6,213 47,353
Eastern 41,169 22,762 18,496 82,427
TOTAL SERVICE POINTS 110,802 35,864 35,833 182,499
*It is important to note that this billing demand level would be achieved only if 100% of the pumps
enrolled in the Program were all running at the scheduled interrption time.
2007 Irrigation Peak Rewards Report Page 10
Table 6 shows the average MW reduction by day for each two week period
achieved utilizing the realization rates multiplied by enrolled peak kW.
Table 6. Average MW reduction utilizing realization rates by period.
Realization
Rate MON TUE WED THUR FRI kW
%(MW)(MW)(MW)(MW)(MW)Average
1 st half of June 41 23.59 23.92 23.95 23.68 23.99 23.83
2nd half of June 64 36.82 37.34 37.39 36.97 37.44 37.19
1st half of Julv 60 34.52 35.01 35.05 34.66 35.10 34.87
2nd half of July 63 30.50 30.92 30.96 30.62 31.01 30.80
1 st half of AUQust 49 28.59 28.59 28.62 28.30 28.67 28.48
2nd half of August 32 18.41 18.67 18.69 18.48 18.72 18.60
As reported earlier, the Company has a sample of 63 load research meters
installed on participating service points. These meters are distributed similar to
participation rates for each area. This data was collected and analyzed and is
shown in the following graphs.
2007 Irrigation Peak Rewards Report Page 11
Graph 2 displays the average hourly kW for all days in June, July, and August
and shows the average load reduction per participating metered service point
within the load research sample. The graphed data represents all interrupt days
in 2007.
Graph 2. Average metered demand (kW).
TOTAL LOAD REASEARCH DATA FOR 2007
250
50
I--A\erage Interrpt Day I
200
~ 150
....I!
~ 100
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Time of Day (hr)
Graph 3 displays the average hourly kW for all days in the second half of June
and shows the average load reduction per participating metered service point
within the load research sample. The graphed data represents all interrupt days
in the second half of June 2007.
Graph 3. Average metered demand (kW) 2nd half of June.
2nd HALF OF JUNE 2007 LOAD RESEARCH DATA
250
50
!__A\erage Interrupt Day I
200
~ 150
..'"
l!
~ 100
o
o 2 3 4 5 7 8 9 10 12 13 14 15 17 18 19 20 22 23 24
Time of Day (hr)
2007 Irrigation Peak Rewards Report Page 12
Another way to view program impact is to look at total system firm load data. The
system firm load during the summer months has the greatest electrical demand
of the year. The highest peak load historically occurs in late June or July between
4-8 PM.
Graph 4 represents the demand response impact to the entire company system
firm load on various days in July 2007. The reduction in system firm load occurs
at 4 PM for the corresponding days and is approximately 30-40 MW for each day.
Graph 4. Demand response impact on Company system firm load.
Program Impacts on System Load
3,200
3,100
3,000
I 2,900
'C 2,800
~ 2,700
E 2,600
~:: 2,500
C/2,400
2,300
2,200
it it ~~ ~~ ~~ ~~ ~~ ~~ ~~ ~~ ~~ ~~ ~~ ~~ it~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~~~..\S~ .."~ ..'i~ ,,~ rt~ nj~ t)~ (,~ fó~ "'~ 'f? ci~ ..\S~ .."~ .."'.
Time
-3-Jul-07
-5-Jul-07
-1Q-Jul-07
2007 Irrigation Peak Rewards Report Page 13
COST EFFECTIVENESS
1. Program Costs
Table 7 displays the annual Program costs as of September 30,2007. Program
costs remain consistent on a year to year basis, except that in 2007 increased
customer participation and a higher number of service points enrolled in the
Program under Option 2 and Option 3 resulted in a higher number of incentives
paid to customers.
Table 7. Program costs.
ITEM PROGRAM COSTS
Electronic timers $63,350.23
Contracted electricians $85,521.87
Incentive payments $1,376,025.98
Marketing and
Administration $66,476.31
TOTAL $1,591,374.39
2007 Irrigation Peak Rewards Report Page 14
2. Benefit-Cost Analysis
The 2007 Peak Rewards Program results were applied to the cost-effectiveness
model that was used when the Program was developed. Table 8 summarizes the
inputs that were used in the cost effectiveness modeL. The Program results
yielded a 30-year average benefit-cost ratio of 1.10.
Table 8. Benefit-cost model inputs
DESCRIPTION INPUT
Number of metered service points 947
Overall program realization rate 50%
Average service point, biling kW (peak month)193
Enrolled peak, kW 182,499
Average July peak reduction (MW)32.8
Participant distribution by area
Western 3%
Canyon 3%
Capital 6%
Southern 35%
Eastern 53%
Service point interruption option
1 day per week 52%
2 days per week 23%
3 days per week 25%
Actual Program Cost (as of Sep. 30, 2007)$1,591,700
2007 Irrigation Peak Rewards Report Page 15