20070207UWI to Staff 1-15.pdf

[phone]
[phone] (Fax)
Via Hand Delivery
Jean Jewell, Secretary
Idaho Public Utilities Commission
472 W. Washington St.
Boise, Idaho 83720
Re: UWI-06-
Dear Ms. Jewell:
McDevitt & Miller LLP
Lawyers
420 W. Bannock Street
O. Box 2564-83701
Boise, Idaho 83702
Chas. F. McDevitt
Dean J. (Joe) Miller
February 7 2007
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Enclosed for filing in the above matter please find three (3) copies of United Water Idaho
Responses to the Commission Staffs First Production Requests.
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Attach.
Very Truly Yours
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UNITED WATER IDAHO INC.
CASE UWI-O6-
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
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Preparer and Company Witness: Grego~W~tt
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po.)Please explain and provide a schedule to reconcile the proposed rider fundfng
dollars and the current level of conservation expenditures included in rates.
Include also a discussion of the following with this reconciliation:
a) Identify the level of the expenditures for the current conservation
program that is included in rates.
b) For any amortizations related to existing conservation programs,
identify unamortized balance at December 31 2006 and the monthly
amortization amount.
REQUEST NO.
RESPONSE NO.
The rider (or surcharge) proposed by the Company is identified in my Direct
Testimony as relating to the proposed annual costs for implementing the new
conservation measures , and not for the current level of conservation
expenditures included in rates. The surcharge amount of 0.33% was also
explained , (see Wyatt Direct Page 5 , Lines 1-7).
a) The level of expenditures for the current conservation program that is
included in rates is approximately $124 200, and is identified in Table 4-
on page 28 of the Water Conservation Plan.
b) There are no amortizations related to the existing conservation programs
and thus no unamortized balances or monthly amortization amounts.
UNITED WATER IDAHO INC.
CASE UWI-O6-
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer and Company Witness: William O. Maddaus
9 Via Cerrada
Alamo , CA 94507
Phone: [phone]
REQUEST NO.
What tests or analysis will be used to determine whether United Water Idaho
conservation program is cost effective; that is, that measurable benefits equal or
exceed its costs?
RESPONSE NO.
Water savings, benefits, and costs were estimated for future planned programs
as outlined in the 2006 Water Conservation Plan. Cost-effectiveness was one of
the main criteria to select measures for the plan. The cost effectiveness was
determined by utilizing an end use model to quantify the associated benefits and
costs for each program. Effectiveness of future programs can be gauged by
analyzing the program participation. If or when participation rates fall well below
the target, the plan could then be modified.
UNITED WATER IDAHO INC.
CASE UWI-O6-
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer and Company Witness: William O. Maddaus
9 Via Cerrada
Alamo, CA 94507
Phone: [phone]
REQUEST NO.
How will the new conservation plan encourage efficient water use by all
customers residential, irrigation and commercial?
RESPONSE NO.
All United Water Idaho classes of customers are targeted by at least one
conservation measure. The company does not have a classification for irrigation
customers, although some commercial customers have irrigation systems
metered. Programs are as follows. Residential: School Education , Trigger
Shutoff Vales and Hose Timers; Irrigation by all customers: Rain Sensors,
Demonstration Gardens , and Water Efficient Landscape Classes. Commercial:
Spray Valves and Award Program.
UNITED WATER IDAHO INC.
CASE UWI-O6-
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer and Company Witness: Gregory P. Wyatt
REQUEST NO.
Please explain how the new conservation plan identifies high-volume users who
place the highest strain on the water supply system. Have you targeted
programs to proportionately assign increasing utility costs and future water
development costs to these customers?
RESPONSE NO.
With the exception of the Business Water Savings Award Program , large water
use customers are not specifically targeted in the new Plan. Unlike many water
utilities, United Water does not have one or several large industrial users that
consume a significant portion of the daily system production. The largest single
water user on the Company s system is St. Alphonsus Medical Center. Large
water users do not necessarily put more of a strain on the system because all
users contribute to the maximum hour and maximum day demand. In fact, a
user like St. Alphonsus, which has little landscaping for irrigation, likely exhibits a
more even water demand pattern throughout the day based on their water use
needs.
UNITED WATER IDAHO INC.
CASE UWI-O6-
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer and Company Witness: Gregory P. Wyatt
REQUEST NO.
Please provide the detailed sub-account numbers and titles that will be assigned
to the new conservation plans balancing account.
RESPONSE NO.
The sub-account, 242-, titled "Conservation Surcharge Balancing Account" will
be assigned. The analysis of the account will be augmented by Project
Identification Numbers to categorize and differentiate expenditures and revenue.
UNITED WATER IDAHO INC.
CASE UWI-O6-
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer and Company Witness: Gregory P. Wyatt
REQUEST NO.
Please provide a sample of how the proposed rider will be identified on the
customers' bill.
RESPONSE NO.
The attached document titled "Attachment to Production Request #6", is a
representation of a mock United Water Idaho bill. United Water proposes that
the rider be identified on customer s bills as "CONSERVATION SURCHARGE"
and it would be located between the "SAFE DRINKING WTR FEE" and the
BOISE FRANCHISE FEE.
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USAGE HISTORY
Bi-Monthly usage in hundred cubic feet Billing Date:1/1 7/07
Account Number:0600099854059
Previous Balance $0.
Payments Through 1/1 7/07 Thank You $78.58CF
Balance Forward $78.58CF
Current Charges
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CORRECTED
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Ssp-Nay Noy-Jan Jan--Mar Mar--May May-Jul Jul--Sep Sep-Noy
SERVICE TO: ROB ROWE SERVICE ADDRESS: 711 11 IJ2E STATE ST BOISE ID
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09/13/06 11/09/06 350
$23.
$10.
$33.
$16.
376 26 CCF ACTUAL
EQUIVALENT TO 448 GALLONS
SAFE DRINKNG WTR FEE
BOISE FRANCHISE FEE
TOTAL CURRENT CHARGES
W18
$0.
$1.49
$51.77
49142056
19.1403 CCF (iY $1.2112
8597 CCF (iY $1.5141
WATER CHARGE SUBTOTAL
CUSTOMER CHARGE
SEE REVERSE SIDE FOR IMPORTANT ACCOUNT INFORMATION
*** Winter rates are in effect until April 301 2007. As cold weather approaches be sure to winterize your sprinkler system,disconnect hoses from outside faucets and Insulate any pipes that could freeze in the coming winter.
***
Donate to UW Cares, and help those in our community who need assistance paying their water bills. Contributions are taxdeductible, and 100 percent of your donation goes to helping families meet their most essential need - water. United Water willmatch all customer donations up to $20,000 annually. Donations can be mailed to UW Cares, P.O. Box 190420, Boise, ID83719-0420. Thank you for your generosity.
PLEASE DETACHI-IERE AND RETURN THE BOTTOM PORTION WITII YOUR PAYMENT IN THE RETURN ENVELOPE PROVIDED, 130BAPA0601002007
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;308 APRo6 0; 06io07
2;( United Water
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8248 West Victory Road
Boise, ID 83709
SERVICE ADDRESS:711111I2E STATE ST
BOISE ID
Account Number: 06000998540591Balance Forward $78.58CRCurrent Charges $51.77
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Please check this box if you have made any
changes to the information on the reverse side.Payment Amount Enclosed
11..1...11.1...1...11..11...1..1...111.1.....111.1..1..
PL: 33ROB ROWE
719 ESTATE 5T
BOISE 10 83712-6419
1...11.1...11...1...11..11....1..111....1..1..
UNITED WATER IDAHO
PAYMENT CENTER
PO BOX 371804
PITTSBURGH PA 15250-7804
0600099854059100000002681000000009
UWI-W.oo-OS
AttachfTijlnt to
Production Request No.
UNITED WATER IDAHO INC.
CASE UWI-06-
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer and Company Witness: Gregory P. Wyatt
REQUEST NO.
Please provide the Company s analysis for unaccounted-for water.
RESPONSE NO.
Please see the enclosed "Attachment to Production Request #7" for the
Company s analysis for unaccounted-for-water for the period ending 12/31/06.
Also, as referenced on pages 23 and 24 of the Water Conservation Plan, United
Water s management of unaccounted-for-water has resulted in the unaccounted-
for-water percentage declining from about 10 percent in 1993 to approximately
2 percent by the end of 2005. And as indicated on the Attachment, the
unaccounted-for-water amount stood at 3.40% at the end of 2006.
1/t8/2007
Unite d Water "1~..
UNACCOUNTED-FOR-\""ATER REPORT
Raw Water Withdrawn from Own Sources (MG)650.473 1798,097 1929.439 643.775 665,021
Plant Use Before Delivery (MG)000 000 000 250 760
N.. Delivery from Own Sources (MG)650,473 1798,097 1929,439 635.525 661.261
Purchased Water (MG)000 000 000 000 000
TOTAL WATER DELIVERED TO SYSTEM (MG)650.473 1798,097 1929.439 635,525 661.261
Planl Use from SYStem (MG)1.398 700 060 000
Other Company Use from SyStem (MG)250 1.400 1.895 1.210 830
Authorized Non-Company Use from System (MG)J.135 135 482 743 1.310
Total Water Sold (MG)815,730 2425,314 1263.907 498,774 793.381
Average 08)' Delivery (MG)20,983 59.937 64.315 23.773 21.442
Maximum Day Delivery (MG)23.718 75.712 83.364 24.879 553
Tolal Miles of Main 1105 1105,960 1105.1105,1072.810
Producrion Expense (S/MG)113,113,000 113,113,98.810
Raw Water Withdrawn from Own Sources (MG)15565.391 15526,781 15509.092 14792,141 14763,922
Plant Use Before Delivery (MG)17,SOO 32.760 75,930 100.350 92.110
Net Delivery from Own Sources (MG)15547,891 15494,021 15433,162 14691.791 14671.812
Pureh..,.d Water (!VIG 000 000 OOD 000 000
TOTAL WATER DELIVERED TO SYSTEM (MG)15547,891 15494,021 15433,162 14691.791 14671.812
Plant Use from System (MG)62,230 49,398 15.258 000 000
Other Company Use from System (MG)63,681 63,686 64.355 62,233 60.368
Authorized Non-Company Use from System (MG)45.788 36,320 31.915 29.258 31.740
Total Water Sold (MG)14848.057 14678,623 14221.825 14025.471 13957,925
TOTAL WATER ACCOUNTED FOR (MG)15019,756 14828,027 14333.353 14116,962 14050,033
TOTAL WATER UNACCOUNTED FOR (MG)528,135 665 994 1099 809 574,829 621.779
('Yo)3.40"1.30%13%91%24%
(GPM/MILE)1.1 1.9 1.0 1.1
RECOVERABLE" LEAKAGE ($IYEAR)
REMARKS:
UWI-W-O&-O5
Attachment to
Production Request No.
UNITED WATER IDAHO INC.
CASE UWI-06-
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer and Company Witness: Gregory P. Wyatt
REQUEST NO.
What is the Company s ongoing percentage target for unaccounted-for water?
RESPONSE NO.
The Company has historically established a target for unaccounted-for-water that
relates to "gallons per minute per mile of main " of water loss rather than a
percentage, because water systems differ in size and amount of water produced.
The Company has historically set the target at 2 gallons per minute per mile of
main because leak detection and recovery costs typically exceed benefits when
losses are below the 2 gallons per minute per mile threshold.
UNITED WATER IDAHO INC.
CASE UWI-06-
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer and Company Witness: Gregory P. Wyatt
REQUEST NO.
For the last three years , please provide results of residential and commercial
water audits including: recommended action , remedial action taken by the
Company, and effect of water audits on individual customer consumption.
RESPONSE NO.
Commercial water audits were never a part of the Company s existing
conservation program and therefore none were performed in the last three years.
The Company s residential water audit program typically focused on outdoor
water use. The number of residential audits performed in the last three years is
very small, as demand for them has fallen to near zero. During the period in
question , residential water audits were only performed upon request by
customers with high summer bills. Residential water audits were not designed to
collect the additional data required for an analysis of water savings, therefore
there is no data to be analyzed now. They were designed to give customers
useful information upon which to make informed decisions about their outdoor
water use. As recommended in the Water conservation Plan , residential water
audits will continue to be made available upon request.
UNITED WATER IDAHO INC.
CASE UWI-06-
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer and Company Witness: William O. Maddaus
9 Via Cerrada
Alamo, CA 94507
Phone: [phone]
REQUEST NO.1 0:
The Conservation Plan does not discuss alternative rate structures as potential
conservation measures. If these measures were not considered , please explain
why not.
RESPONSE NO. 10:
United Water already has a seasonal rate where customers are charged 25%
more per unit of consumption in the summer period (May to September) than in
the winter (October to April). This rate structure already encourages water
conservation by raising the summer water bill more than it otherwise would be.
Monthly billing would make this rate structure even more effective. Changes to
the Company s rates were not evaluated as a conservation measure. Changes
to the Company s rates were initially considered but dismissed for the following
reasons. The elasticity of demand for water in normal pricing situations is , based
on my experience, quite low for a number of key reasons:
In most cases, the customers' annual water bill represents a small
percentage (0:::2%) of household income , which does not induce
substantive changes in water use when price is increased.
For indoor water use (sanitation , cooking, laundry), the use of
water is largely non discretionary. There is no real substitute so
that any small (say 10% of less) increase in price has virtually no
impact on water use; and increases up to 20% will still reflect an
elasticity of up to -15 in non crisis situations.
For outdoor use, the demand is considerably more discretionary;
however, small price increases will still have only a minimal
effect. Larger increases will cause reductions in usage but
usually not greater than an elasticity of -30.
. A certain portion of United Water s customers have an alternate
supply of irrigation water available to them (Le. served via non-
potable irrigation canals and pressurized systems such as
Nampa & Meridian Irrigation) and changes to the Company
rates would have no impact on the landscape water use by those
customers.
Many water customers are not overly concerned with the cost of
the water they are using. This is true not only because the low
cost doesn t capture their attention, but also because the water
bill comes infrequently and does not effectively imprint the
message of price.
UNITED WATER IDAHO INC.
CASE UWI-06-
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer and Company Witness: William O. Maddaus
9 Via Cerrada
Alamo, CA 94507
Phone: [phone]
REQUEST NO. 11:
The Plan does not discuss restrictions on outdoor water use, by either hour or
day (e.g. no irrigation between 11am and 6pm, odd/even day restrictions).
Please explain why these types of measures were not considered.
RESPONSE NO. 11:
The water industry generally considers these types of restrictive measures as
drought mitigation measures. They are described in Drought Management
handbooks published by the American Water Works Association. These types of
restrictions would increase the peak day use by restricting the time of use to
shorter peak periods. Because these measures have been shown to be effective
during water shortages by other utilities, United Water should reserve them for
use as required during any future shortage period.
United Water has, for many years and via a variety of communications
encouraged customers to irrigate their landscaping during the coolest parts of the
day, i.e. during the early morning hours. This has been effective as evidenced by
the fact that the Company s highest daily usage during the summer peaks occurs
between the hours of 3:00 AM. to 9:00 AM.
UNITED WATER IDAHO INC.
CASE UWI-06-
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer and Company Witness: William O. Maddaus
9 Via Cerrada
Alamo, CA 94507
Phone: [phone]
REQUEST NO. 12:
The Plan does not discuss time of use , other than seasonality. Was time of use
considered, and if not, why not? Would programs or pricing structures that shift
irrigation or other water usage to the night-time benefit the system?
RESPONSE NO. 12:
United Water s daily peak use period during the summer is between 3 AM and 9
AM due to a combination of peak indoor use and customer watering patterns.
Customers have been asked to water at night to reduce evaporation and have
largely done so. Time of use metering for customers is not normally practiced in
the water industry and would likely be very expensive to implement. Changing
from bi-monthly to monthly billing would increase the effectiveness of the
seasonal rates already in effect.
UNITED WATER IDAHO INC.
CASE UWI-06-
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer and Company Witness: William O. Maddaus
9 Via Cerrada
Alamo, CA 94507
Phone: [phone]
REQUEST NO. 13:
If one examines the distribution of the ranking scores for the screening of
potential conservation measures, there does not seem to be a logical break in
the distribution between scores of 17 and 16, but such a break does occur
between 14 and 13. There are 34 potential conservation measures with scores
of 14 , 15 and 16 that were eliminated from further consideration in the screening
phase , and 16 measures with a score of 17. Considering the subjectivity of the
voting in the screening process, this is a relatively minor, and probably
insignificant, difference. Was any further analysis conducted on these 34
measu res? If not, why?
RESPONSE NO. 13:
The conservation measure screening process that was employed is explained
starting on page 34 of the Water conservation Plan report. In Table 5-
beginning on page 36, there were 30 measures that scored over 17 points.
When these measures were consolidated by combining similar measures which
were the same but targeted different customer classes, the list was reduced to
17. In other words about one-third of the measures passed the screening
process. If the passing score of 14 was used then only one-third of the
measures would have been eliminated. Once eliminated further analysis was not
conducted. The participants in the second workshop believed that this list of 17
measures represented a robust list of measures to choose from and those
measures eliminated at this stage were inferior to those retained.
UNITED WATER IDAHO INC.
CASE UWI-06-
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer and Company Witness: William O. Maddaus
9 Via Cerrada
Alamo, CA 94507
Phone: [phone]
REQUEST NO. 14:
What was the criteria used to determine the cut-off point of 17 points for the
screening process?
RESPONSE NO. 14:
As mentioned in the response to Request No. 13, the cut-off point of 17 worked
well for reducing the measures under consideration to a manageable number, yet
leaving enough measures to craft an effective plan from. In our experience with
using this method with other water systems since 1995 , the cut-off of 17 points is
almost always selected.
UNITED WATER IDAHO INC.
CASE UWI-06-
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer and Company Witness: William O. Maddaus
9 Via Cerrada
Alamo, CA 94507
Phone: [phone]
REQUEST NO. 15:
Is the information readily available to determine cost/benefit ratios for these 34
screened out measures? If not, is information readily available from other utility
efforts that would indicate whether any of these 34 measures are likely to have
similar cost/benefit profiles to any of the measures that had cost benefit ratios
greater than one in this analysis?
RESPONSE NO. 15:
The 34 measures eliminated were not studied further and so there is no
information readily available from which to determine water savings and
cost/benefit ratios. It is not known whether other utilities might have such
information, but even if they did a cost/benefit ratio is highly dependent on the
individual utility cost of water and cost to run the program which can vary greatly
from area to area. Although a definitive answer to the question is not possible; it
is my opinion that because these 34 measures were rated lower than the others
it is likely they would have a lower cost/benefit ratio.