20100602PAC to Staff 10-15.pdf

~ROCKY MOUNTAINPOER
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201 Sout Main, Suite 2300
Salt Lake City, Uth 84111
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June 1,2010
Jean Jewel
Idaho Public Utilties Commission
472 W Washington
Boise, ID 83702-5983
RE: PAC-E-1O--3
IPUC_Production Data Request (10-15)
Please find enclosed Rocky Mountain Power's Responses to IPUC _Production Data Request
Numbers 10-15.
If you have any questions, please feel free to call me at [phone].
Sincerely,
ie?/ CU~ /~
Ted Weston, Manager
Regulation
Enclosures
C.c.: Bryan Lanspery
Gar Grayson
Krstine A. Sasser
PAC-E-10-03/Rocky Mountain Power
June 1,2010
IPUC Production Data Request 10
IPUC Production Data Request 10
Please explain the Company's intent to purue all cost effective demand side
management (DSM) opportties.
Response to IPUC Production Data Request 10
The Company pursues a portfolio of supply and demand-side resources that has
been identified through the IR as having the least cost over the long term. The
Company seeks to acquire, through its programs, the demand-side resources
identified in the preferred portfolio and the associated IRP action plan.
Recordholder: Jeff W. Bumgarer
Sponsor: To Be Determined
PAC-E-IO-03/Rocky Mountain Power
June 1,2010
IPUC Production Data Request 11
IPUC Production Data Request 11
Are all DSM programs curently offered expected to continue to be cost-
effective? Please explain.
Response to IPUC Production Data Request 11
Overall, Rocky Mountain Power's demand side management portfolio was cost
effective under all five tests based on 2009 results. In addition, all demand side
management programs were cost effective based on the Utilty Cost and the Total
Resource Cost tests, with the exception of the Agricultural Energy Services
program. Factors contributing to the marginal Total Resource Cost test results for
this program were provided in Rocky Mountain Power's Demand Side
Management Anual Report on pages 26 - 28. The Company expects the
Agricultural Energy Services program to be cost-effective going forward and that
the remaining programs in the portfolio wil continue to operate in a cost-effective
maner.
In October 2009, the Company initiated third-party independent process and
impact evaluations for the Home Energy Savings, See Ya Later Refrigerator,
Energy FinAswer, FinAnswer Express and Agricultural Energy Services
programs for program years 2006 - 2008. The draft results of these evaluations
are expected to be available during the second and third quarers of201O.
Findings from these evaluations wil be key inputs to on-going program design and
modification as well as inputs to future cost effectiveness determinations.
k~Recordholder: JeffW. Bumgarner ,
Sponsor: To Be Determined
Ii
PAC-E-10-03/Rocky Mountain Power
June 1,2010
IPUC Production Data Request 12
IPUC Production Data Request 12
Please explain how customers would realize a long-term net benefit if the
Company were to terminate its contract with the Northwest Energy Effciency
Allance (NEEA) and eliminate its Irgation Energy Services Progr.
Response to IPUC Producnon Data Request 12
Rocky Mountain Power does not mean to suggest the elimination of the two
programs would provide long-term benefits to Rocky Mountan Power's Idaho
customers. The two programs were identified simply as near-term cost cutting
actions the Company could tae if the Idaho Public Utilties Commission were to
find it in the public interest (at this time) to reduce the size of the Company's
curent request. NEEA was proposed as an option due to timng with the
Company's cycle two fuding commtment (2005-2009) having been satisfied
and the Company having yet to commt to NEEA's cycle three fuding (2010-
2014) request, pending the outcome of this filing, for Rocky Mountain Power's
Idaho service area. The Irrigation Energy Savers program was proposed due to
agricultual customers currently receiving a sizable share of the fuding and
benefits through paricipation in the load management program.
From a cost benefit perspective, Rocky Mountan Power's justification for
continuing support ofNEEA's work is based on studies such as the 2008
Retrspective Report (refer to attchment IPUC 2.12) where an independent
evaluator assessed NEEA's resource acquisitions as costing less than $.01 per
kilowatt hour, far below the cost of other new resources available to the Company
and customers. As noted in Rocky Mountan Power's 2009 Demand Side
Management Anual Report of Idao programs (Report), filed with the Idaho
Public Utilty Commission in March, 2010 (also available at
http://ww.pacificorp.comles/dsm.html) the performance ofthe Irrgation Energy
Savers (Program) was marginal in 2009. The 2009 results showed the Program
failing the total resource cost and rate impact cost tests (.861 and .740,
respectively) but passing the utility cost and paricipant cost tests (1.696 and
1.684, respectively). As explained in the Report, the margin results were period
specific and the Company is projecting improved Program performance in 2010.
As a result, the Company expects both NEEA and the Irgation Energy Savers
would provide long-term benefits to Rocky Mountain Power's Idaho customers
should they be fuded and perform as projected.
Recordholder: JeffW. Bumgarer
Sponsor: To Be Determined
PAC-E-10-03/Rocky Mountan Power
June 1,2010
IPUC Production Data Request 13
IPUC Production Data Request 13
Please explain Rocky Mountain's past and curent active parcipation in NEEA's
cost-effectiveness advisory commttee.
Response to IPUC Production Data Request 13
Rocky Mountan Power has not had representation on NEEA's cost-effectiveness
commttee. However, the Company has maintained an active seat on the NEEA
board since NEEA's inception and has engaged in discussions regarding and
decisions involving recommendations from the cost-effectiveness committee.
Rocky Mountain Power has also provided input to NEEA's cost effectiveness
committee on an as requested basis.
Recordholder: JeffW. Bumgarer
Sponsor: To Be Determined
PAC-E-10-03/Rocky Mountan Power
June 1,2010
IPUC Production Data Request 14
IPUC Production Data Request 14
Please explain Rocky Mountain's past and curent active paricipation in other
NEEA advisory committees.
Response to IPUC Production Data Request 14
Rocky Mountain Power has been and continues to be active in all NEEA
customer sector (Residential, Commercial, and Industral Sector Expert
Committees) and code committees (NEA/utility codes group). The Company
also actively paricipates in relevant NEEA advisory groups such as the rual
services advisory group, a group providing direction to NEEA on proposed
enhancements to NEEA's 2010-2014 business plan intended to ensure NEEA
value and services in rual markets. The Company also paricipates in the
Nortwest Research Group whose focus is to provide a venue for cross-utility
collaboration on market research and program evaluations. Although not
formally a NEEA committee, NEEA is active in the group providing faciltation
services and valuable input to ths regional collaboration.
Recordholder: JeffW. Bumgarer
Sponsor: To Be Determined
PAC-E-10-03/Rocky Mountain Power
June 1,2010
IPUC Production Data Request 15
IPUC Production Data Request 15
The Company states in its Application that the cost-effectiveness of the Irgation
Energy Services program in 2009 passed the utilty cost test (UCT), but did not
pass the Total Resource Cost test (TRC). The Application lists the followig as
priar contrbuting factors: 1) transition costs associated with changing
program admistrators and 2) customer specific costs associated with equipment
investments that delivered operational effciencies in addition to energy efficiency
benefits, i. e. "the additional customer costs from these seven projects had a
negative impact on the TRC test from a strctly electrc energy savings
perspective." Application at 11. Please answer the following questions regarding
these issues:
a) What were the specific costs associated with the transition of program
administration?
b) Were the transition costs included in calculating cost-effectiveness
from both the total resource cost (TRC) and the utility cost (UCT)
perspectives? Please explain.
c) Does the Company typically include non-electrcity benefits in its
TRC cost-effectiveness calculations? Explai why or why not.
d) Does the Company tyically include non-electrcity benefits in its
Paricipant cost-effectiveness calculations? Explain why or why not.
e) Are the "additional customer costs" from the seven projects with long
simple paybacks separately identifiable from the costs incured for
energy effcient equipment? Please explain.
f) What action has the Company taen to ensure that all measures
associated with the Irrgation Energy Services program will be cost
effective from the TRC, UCT and Paricipant perspectives in the
futue?
g) The Company's 2009 DSM Anua Report lists a process and impact
evaluation for the Irrgation Energy Services as being "In Process."
When is that evaluation expected to be completed?
h) Has the Company (or contractors for it) previously completed any
formal evaluations of irrgation effciency? If so, please provide a
copy of any such evaluation( s).
Response to IPUC Production Data Request 15
a) The incoming program adminstrator biled $36,750 for updating customer
and trade ally oriented program materials and purchasing some field test
equipment. Both the ingoing and outgoing program adminstrator incured
costs in transferrng completed files, information about work in progress as
well as phone and email systems. In addition, the first half of 2009, the
outgoing program admnistrator submitted bils $63,967 which included some
of their 2008 work.
PAC-E- 1 0-03/Rocky Mountain Power
June 1,2010
IPUC Production Data Request 15
b) Yes, the transition costs are a progr expense incured to deliver the
program and included in 2009 program administration expense of$4l6,461
which was used to calculate TRC and UCT results.
c) Except for the ten percent increase in benefits included in the PTRC
calculation, the Company does not included non-energy benefits in any of the
cost effectiveness calculations. The Company has chosen to utilize only
electric energy benefits for the cost benefit analysis since they are easiest to
accurately quatify, and they are the most conservative measure of the
benefits that the utility and non-paricipants are likely to receive from demand
side management investments.
d) Please refer to the Company's response to IPUC 15 c) above. Whle the
Company believes that if there are non-energy benefits, they tyically accrue
to participants, but they are diffcult to accurately quatify and they may var
between individual paricipants.
e) Documentation for these projects includes costs to install the equipment
necessar to deliver the energy savings. Project costs directly attbutable to
the energy portion of the equipment are a sub-set of these project costs, but
were not allocated in the customer provided documentation. It is important to
note that program paricipants may be willing to invest in longer payback
projects to receive non-energy benefits in addition to the electrc energy
benefits reported through the program. When large paricipant investments
are made, the additional paricipant costs are reflected in the TRC tests,
although, the Company and ratepayers have not paid any additiona costs to
acquire the electrc energy savings. For 2009, based on the results provided in
Attchment 2 of the Application, if gross customer costs were approximately
$275,000 less, the TRC test result would be approximately 1.0.
f) The program was cost effective on a UCT and Paricipant cost perspective in
2009 and is forecast to be cost effective in 2010 (Attchment 4 in the
Application), but the mix and cost of the customer projects for 2010 is based
on a forecast. If customers with long payback projects chose to paricipate in
the futue, the program administrator will tae extra steps to align electric
energy and estimated non-energy benefits with project costs and may calculate
an adjustment for long payback projects costs prior to project close-out and
reporting.
g) The field work for the program evaluation was scheduled to align with having
fuly operational equipment (afer the sta of the irgation season in May) so
field measurements for power and flow are the most representative. The field
evaluation work is scheduled to begin in June after well levels and equipment
star-up is complete. The evaluation report is expected to be completed in the
September/October timeframe.
. ~ . ~
PAC-E-10-03/Rocky Mountain Power
June 1,2010
IPUC Production Data Request 15
h) No formal evaluation has been completed for the program.
Recordholder: JeffW. Bumgarer
Sponsor: To Be Determined