20231211INT to Staff 2_6_8-14.pdf

INTERMOUNTAIN GAS COMPANY’S RESPONSES TO STAFF’S FIRST PRODUCTION REQUEST PAGE 1 OF 2
18110385.1)
Preston N. Carter, ISB No. 8462
Morgan D. Goodin, ISB No. 11184
Givens Pursley LLP
601 W. Bannock St.
Boise, ID 83702
Telephone: [phone]
Facsimile: [phone]
[e-mail]
[e-mail]

Attorneys for Intermountain Gas Company

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF INTERMOUNTAIN
GAS COMPANY’S APPLICATION FOR A
DETERMINATION OF 2022 ENERGY
EFFICIENCY EXPENSES AS PRUDENTLY
INCURRED
Case No. INT-G-23-06

INTERMOUNTAIN GAS COMPANY’S
RESPONSES TO FIRST PRODUCTION
REQUEST OF THE COMMISSION STAFF
Intermountain Gas Company (“Intermountain” or “Company”), in response to the First
Production Request of the Commission Staff to Intermountain Gas Company dated November
20, 2023, submits the following responses. Responsive documents are available for download
using the link provided in the accompanying email. Confidential responses and documents are
subject to the protective agreement in this case, and are available for download using a
password-protected link that will be provided separately by email. The password will be
provided in a third email.
DATED: December 11, 2023.

By:_____________________________
Preston N. Carter
Givens Pursley LLP
Attorneys for Intermountain Gas Company.

RECEIVED
Monday, December 11, 2023 3:05:06 PM
IDAHO PUBLIC
UTILITIES COMMISSION

INTERMOUNTAIN GAS COMPANY’S RESPONSES TO STAFF’S FIRST PRODUCTION REQUEST PAGE 2 OF 2
18110385.1)

CERTIFICATE OF SERVICE

I HEREBY CERTIFY THAT on December 11, 2023, I caused a true and correct copy of
the foregoing to be served upon the following parties as indicated below:

Monica Barrios-Sanchez
Interim Commission Secretary
Idaho Public Utilities Commission
P.O. Box 83720
Boise, Idaho 83720-0074
[e-mail]

Email
U.S. Mail
Fax
Hand Delivery

Preston N. Carter

INTERMOUNTAIN GAS COMPANY
CASE INT-G-23-06
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer/Sponsoring Witness: Kathy Wold/Kathy Wold
REQUEST NO. 2:
Please provide copies of all internal audit reports referencing any of the Company’s
energy efficiency expenses and processes for 2022 and 2023, to date. If no reports were issued,
please provide the date and scope of each audit and all internal auditor workpapers.
RESPONSE NO. 2:
There were no internal audits of the Company’s energy efficiency expenses or processes
in 2022 or 2023.
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INTERMOUNTAIN GAS COMPANY
CASE INT-G-23-06
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer/Sponsoring Witness: Kathy Wold/Kathy Wold
REQUEST NO. 6:
Please provide the estimated capital and operational and maintenance costs for the rebate
processing application (“rebate app”) for the next 5 years. Please provide supporting workpapers.
Additionally, please explain if these expenses will be booked to the rider account.
RESPONSE NO. 6:
No expenses for rebate app maintenance or operations expenses will be booked to the
rider account. Work on the rebate app is being done using internal resources which are included
in the Company’s base rates.
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INTERMOUNTAIN GAS COMPANY
CASE INT-G-23-06
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer/Sponsoring Witness: Kathy Wold/Kathy Wold
REQUEST NO. 8:
In the Company’s 2022 prudence filings, the Commission directed the Company to use
billing analysis to evaluate the performance of the whole home and furnace measures. Please
describe the changes that the Company has made, or is considering, for these programs in the
2023 program year.
RESPONSE NO. 8:
There were no changes made to the whole home or furnace offering in the 2023 program
year. Instead, the Company will use billing analysis to evaluate the performance of the whole
home, furnace and smart thermostat measures in the formal Evaluation, Measurement &
Verification (EM&V) study to be conducted by a 3rd party in early 2024. The EM&V results will
be used to inform program changes in 2024.
In 2018, to launch the Energy Efficiency program Intermountain used the estimated
therm savings from a Conservation Potential Assessment (CPA) conducted for a sister utility in
the same geographical region, and same climate zones, as a starting place for the program. At
that time, a unit therm savings estimate of 112 therms was used for the Furnace, and unit savings
of 204 therms for the Whole Home rebate.
In 2019, the Company commissioned a CPA specifically for the Intermountain Gas
Energy Efficiency Program to inform both the Integrated Resource Plan and Energy Efficiency
Program planning.
In 2020, the Company commissioned an EM&V study that included a Process Evaluation
of the program, and an Impact Evaluation of the Whole Home rebate and the Furnace rebate. A
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billing analysis was conducted on the estimated unit savings currently in use of 112 therms per
furnace, and the unit saving estimate of 204 therms per Whole Home. In both cases, the EM&V
evaluator found that the measures were not achieving the estimated therm savings. The Company
used the recommendations of the EM&V to inform Program changes.
From the furnace rebate evaluation, Evaluators recommended:
using AHRI certification for approving equipment,
encouraging Manual J training for contractors,
using engineering-based evaluation approaches for evaluation,
adding more data collection on the application such as identifying replace on
burnout, early retirement, and new construction.
Except for the recommendation to use engineering-based evaluation, and instead heeding Staff
recommendation and Commission Order to use billing analysis for future evaluations, the
Company acted on these recommendations. In addition to the Evaluator’s recommendation for
additional data collection, the Company took additional steps to collect the efficiency and size of
the equipment being replaced to provide for more robust future program evaluation. As a result
of the evaluation, the Company also reduced the furnace unit therm savings estimate to 87
therms per furnace based on the 2019 CPA commissioned by the Company for the Program. The
Company believed the program changes would result in therm savings in line with what the 2019
CPA identified as potential therm savings. This therm savings estimate was higher than the
therm savings measured by the EM&V prior to the program changes being adopted.
Regarding the Whole Home rebate, Evaluators recommended:
imposing a more stringent HERS Index requirement,
removing the Energy Star certification requirement, and
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imposing specific requirements, in addition to a HERS requirement, to directly
target natural gas savings.
Evaluators also conducted a new homes modeling study to help inform the redesign of the Whole
Home rebate. The Whole Home rebate was redesigned based on the Evaluator’s
recommendations and the additional study commissioned by the Company. The Company
removed the Energy Star certification requirement,
removed the HERS Index threshold, but retained the HERS certification,
added specific energy performance targets for air change per hour and duct
leakage to directly target natural gas savings,
added a high-efficiency equipment requirement for the heating equipment,
created a two-tiered rebate which provided a higher incentive for more energy
efficient performance targets, high efficiency equipment requirement and an
additional ceiling insulation requirement.
The unit therm savings estimate for the Whole Home rebate was also revised based on the results
of the evaluation and the home modeling study. A unit savings estimate of 161 therms was
implemented for the Whole Home Tier I, and 128 therms for Whole Home Tier II.
The Company commissioned and completed a CPA in 2023 to identify new potential
savings opportunities. This study was completed by Guidehouse and in addition to informing the
Integrated Resource Plan, the study included a model created by Guidehouse that will be used to
assist in future energy efficiency program planning. To characterize key study inputs such as unit
basis, energy consumption and savings, and cost inputs for each measure, Guidehouse utilized a
range of Technical Reference Manuals (TRMs). Guidehouse prioritized the TRMs used in
Intermountain’s CPA based on the following criteria:
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Climate zone – TRMs from states with similar IECC climate zones,
Codes and Standards – TRMs that do not set appliance standards beyond Federal code
requirements to avoid differing baseline efficiency levels when compared to Idaho,
Data Format – TRMs with deemed savings values were prioritized over TRMs that only
contained engineering algorithms and equations. Deemed savings are agreed-upon
savings resulting from installation of specified measures, not requiring customized
analysis after-the-fact. The advantage of using deemed values is the ability to incorporate
technical measure parameters and variables that have been vetted and approved by the
regulatory bodies and experts who maintain TRMs. In addition, leveraging publicly
available sources increases transparency and creates less reliance on assumptions of key
measure parameters by Guidehouse.
Additionally, Guidehouse utilized the findings from Intermountain’s 2020 Impact
Evaluation, Verification and Measurement (EM&V) for the furnace measure to inform measure
assumptions and account for realized program results in the characterization of measure savings,
as basing savings in potential studies on previous realized program results is an industry best
practice.
No therm savings estimates in the 2022 Annual Report are based on information
contained in the 2023 CPA. In early 2024 the company will commission an EM&V study using
billing analysis on the Furnace, Whole Home, and Smart Thermostat rebates. The Company will
use both of these comprehensive studies to inform future program planning.
Independent, third-party evaluation is a very comprehensive process with significant
program expenses. In an effort to continually monitor and evaluate and update program incentive
with the best available data, the Company is also exploring smaller-scale, independent,
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evaluation activities in between formal evaluation studies. The Company has had initial
conversations with the University of Idaho Integrated Design Lab (IDL) who has expressed the
interest and expertise to conduct small-scale evaluation and verification studies that would
provide the Company with insights into the effectiveness of specific measures between
conducting full-scale program EM&V studies.
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INTERMOUNTAIN GAS COMPANY
CASE INT-G-23-06
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer/Sponsoring Witness: Kathy Wold/Kathy Wold
REQUEST NO. 9:
Did the Company conduct a cost-benefit analysis for the rebate app? If so, please provide
it and information including, but not limited to, the expected error reductions by using the app,
any FTE reductions, etc. If the Company did not conduct a cost-benefit analysis for the rebate
app, please explain why not.
RESPONSE NO. 9:
The Company did not conduct a cost-benefit analysis for the rebate app. The Company
was using an Excel spreadsheet for all rebate tracking, which included several years of program
data. Both the Energy Efficiency (“EE”) and Enterprise Information Technology (“EIT”)
departments had concerns about Energy Efficiency exceeding the functionality of Excel, both
from a tracking standpoint and the ability to maintain data integrity. EE considered the
possibility of purchasing a software package for rebate processing. In discussions with EIT,
however, EIT recommended leveraging an existing Company process used for issuing customer
refunds. This process also linked existing internal systems used to verify customer status, the
data warehouse, and accounts payable. EIT built a process that allowed this existing customer
refund process to also be used for EE rebate payments.
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INTERMOUNTAIN GAS COMPANY
CASE INT-G-23-06
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer/Sponsoring Witness: Kathy Wold/Kathy Wold
REQUEST NO. 10:
Please explain if any costs associated with the rebate app are included in this filing, If so,
please provide the total amount included.
RESPONSE NO. 10:
There are no costs associated with the rebate app included in this filing.
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INTERMOUNTAIN GAS COMPANY
CASE INT-G-23-06
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer/Sponsoring Witness: Kathy Wold/Kathy Wold
REQUEST NO. 11:
In the Annual Report, the Company state that it utilized the in-house Enterprise
Information Technology (“EIT”) department for the rebate app development.
a.Please explain how labor from EIT is allocated to the Energy Efficiency rider. Please
provide supporting workpapers.
RESPONSE NO. 11:
EIT, Enterprise Information Technology, labor expense is not allocated to the Energy
Efficiency rider. EIT labor is included in customer base rates.
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INTERMOUNTAIN GAS COMPANY
CASE INT-G-23-06
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer/Sponsoring Witness: Kathy Wold/Kathy Wold
REQUEST NO. 12:
Please explain the driving factors that influenced increased participation in the Smart
Thermostat program.
a.Additionally, please explain how the Company promoted the Smart Thermostat
program in 2022; and
b.Please provide any documentation of promotion or marketing of the program.
RESPONSE NO. 12:
While there are several factors that could have influenced the increased participation in
the Smart Thermostat rebate it is important to note that smart thermostat rebate was just launched
April 1, 2021. The increase in participation in the smart thermostat rebate is a comparison of 9
months of 2021 and 12 months of 2022.
The Company promoted the smart thermostat rebate to customers and builders using the
following promotional materials: the annual residential customer bill insert, an outreach activity
that also included the “Hungry for Savings” customer engagement activity and residential
customer email, the residential program brochure, the builder program brochure, the energy
efficiency website, and through social media. A sample of each of these promotional materials is
provided in PR#1_12 _Smart Thermostat Promotions.
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INTERMOUNTAIN GAS COMPANY
CASE INT-G-23-06
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer/Sponsoring Witness: Kathy Wold/Kathy Wold
REQUEST NO. 13:
In the Annual Report at 13, Table 5. “Rebates received post October Customer
Engagement” has a total of 3,243 rebates applied for in 2022, The Application state the number
of rebates paid to residential customers in 2022 was 7,945. Application at 10. Please explain the
discrepancy between the total of rebates applied and paid for in 2022.
RESPONSE NO. 13:
The total number of residential rebates paid in 2022 was 7,945. The monthly distribution
of 3,243 rebates shown for 2022, in the Annual Report at 13, Table 5, represents residential
equipment replacement rebates only. It does not include rebates paid to builders for new
construction.
Table 5, at 13, is an illustration of the number of equipment replacement rebate
submissions up to, and the months following, the October “Hungry for Savings” customer
engagement activity. Rebate submissions in each of the four months following the October bill
insert, customer email, and grocery card sweepstakes, outpaced every month prior to the October
Energy Efficiency promotion. These counts excluded builder rebates, as builders did not receive
any “Hungry for Savings” promotional materials and were not eligible for the grocery card
sweepstakes.
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INTERMOUNTAIN GAS COMPANY
CASE INT-G-23-06
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer/Sponsoring Witness: Min Park/Kathy Wold
REQUEST NO. 14:
Please explain the increase of unit “Therm Savings” of 1,036 in 2021 to 1,295 in 2022 for
the High-Efficiency Condensing Boiler. Please provide supporting workpapers detailing the
calculation of program therm savings and individual rebate therm savings.
RESPONSE NO. 14:
“Therm savings” was calculated for the year 2021 by taking the Savings, measured by
dividing therms by KBTUH, and multiplying this value by the total rebated capacity. This
produces the total annual therm savings by sector. Therm savings for all sectors is summed up
for the year (4,145) and divided by the total number of rebates (4) to return the value of 1,036.
This process was repeated for 2022.
The savings values for 2022 remained the same, but the increased total rebated capacity
accounts for the higher total annual therm savings value. There were 4 total rebates in 2021 and 7
rebates in 2022. This led to higher therm savings in 2022: 9,064 therms divided by 7 rebates for a
value of 1,295 for the High-Efficiency Condensing Boiler. Calculations are provided in the file
CONFIDENTIAL_PR#1_7 2022 UCT, on the tab labeled “BOILER.”
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