20110110_3204.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KEMPTON,,
CO MMISSI 0 NER SMITH
CO MMISSI 0 NER RED FORD
COMMISSION SECRETARY
LEGAL
WORKING FILE
I, ,
FROM:LYNN ANDERSON
DATE:JANUARY 7, 2011
RE:ROCKY MOUNTAIN POWER TARIFF ADVICE NO. 10-
On December 12 2010, Rocky Mountain Power (Rocky Mountain or Company) filed several
revisions to its Schedule 115 FinAnswer Express energy efficiency program. The Application
requested Modified Procedure with an effective da~e of January 15 2011. The stated purposes of the
proposed changes are to align FinAnswer Express program incentives with new federal and industry
standards, to add the new Integrated Energy Efficiency Ratio (IEER) to its part-load cooling incentive
, ., .
qualifications, and to modify program administration.
One of the primary drivers of the proposed changes is the federal Energy Independence and
Security Act of 2007, which is requiring gradual phase-out of inefficient lighting, motors and other
equipment. Other new campaigns, standards~J;1d recommendations referenced by the Company as
causing program changes are those initiated by the Consortium for Energy Efficiency (CEE), the
National Electrical Manufacturers Association (NEMA), the Green Motors Group , the American
Society of Heating, Refrigeration and Air-Conditioning Engineers (ASHRAE), the Air Conditioning
Heating and Refrigeration Institute (AHRI), the International Standards Organization (ISO), and
Energy StarCID. Proposed administrative changes include program clarifications and corrections of
typographical errors.
A more noteworthy administrative change is the proposed additional language of "
...
subject to
funding availability" on Sheet 115.1. The Company states "This language will enable Rocky
Mountain Power to deliver the program in combination with funding caps should they be necessary to
operate the Company s Idaho DSM portfolio in alignment with the level of Schedule 191 (Customer
Efficiency Services) revenue.
DEC1SION MEMORANDUM JANUARY 7 , 2011
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The Company says the proposed tariff changes are not expected to significantly affect the total
resource cost test (TRC) of cost-effectiveness of the Energy FinAnswer program. While the
Company s previous DSM annual reports have indicated that this program has been cost-effective, a
formal, 3rd party evaluation is currently being conducted for program years 2006 through 2008 and that
evaluation will be provided to the Commission as part of the Company s 2010 DSM Report.
STAFF ANALYSIS AND RECOMMENDATION
The proposed tariff changes are generally indicative of active management of energy efficiency
(or demand side management, DS~) programs in response to changing conditions. While the
Company states that the changes are not expected to s,ignificantly alter TRC cost-effectiveness, Staff
believes that the alternative of not changing the program to align with changing conditions would
significantly reduce cost-effectiveness from the utility cost test (UCT) perspective.
The proposed restrictive tariff language of "subject to funding availability" is somewhat
troubling because it is at least theoretically at odds with the Commission s mandate for electricity
utilities to acquire all cost-effective energy efficiency. Instead of placing limits on such resources
utilities should pursue all cost-effective DSM resources and request appropriate recovery through the
Commission. But, given the Company s past experiences with the Commission not allowing
immediate, full funding of its DSM programs, Staff understands why the Company is proposing the
subject to funding" limitation. Nevertheless, Staff does not foresee a need for the Company to limit
funding of this program in the near future.
Staff recommends approval of the proposed tariff modifications, but without the modified
procedure process requested by the Company. Staff reminds Rocky Mountain Power that its
recommendation for approval should not in any way be interpreted as a pre-determination of prudency
for a future prudency review case.
COMMISSION DECISIONS
Does the Commission approve the tariff changes? ' Does the Commission want to address the
proposed "subject to funding" tariff language addition?
i:udmemo/ Rocky Mountain Power Tariff Advice 10-03 dec memo
Lynn Anderson
,.,;
DECISION MEMORANDUM JANUARY 7, 2011