20110627_3370.pdf

DECISION MEMORANDUM 1
DECISION MEMORANDUM

TO: COMMISSIONER KJELLANDER
COMMISSIONER REDFORD
COMMISSIONER SMITH
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL

FROM: NEIL PRICE
DEPUTY ATTORNEY GENERAL

DATE: JUNE 24, 2011

SUBJECT: APPLICATION OF PACIFICORP DBA ROCKY MOUNTAIN POWER
TO SUSPEND FUTURE PROGRAM EVALUATIONS OF SCHEDULE 21,
LOW INCOME WEATHERIZATION SERVICES OPTIONAL FOR
INCOME QUALIFYING CUSTOMERS, CASE NO. PAC-E-11-13

On April 29, 2011, PacifiCorp dba Rocky Mountain Power (“Rocky Mountain” or
“Company”) filed an Application with the Commission seeking an Order suspending the
Company’s future obligation to perform program evaluations of its Schedule 21 Low Income
Weatherization Services Optional for Income Qualifying Customers Program.
APPLICATION
Rocky Mountain partners with two non-profit weatherization agencies that install
energy efficiency measures in income eligible households at no-cost to residents: Eastern Idaho
Community Action Partnership in Idaho Falls and Southeastern Idaho Community Action
Agency in Pocatello.
Rocky Mountain attached a copy of the evaluation conducted by The Cadmus Group,
Inc. of its Schedule 21, Low Income Weatherization Services Optional for Income Qualifying
Customers (“Program”), to its Application. The program evaluation was based on program
activities for the time period of 2007 through 2009.
Rocky Mountain states that, due to many factors, the evaluation reveals that the
Program is not cost-effective. As such, the Company seeks an acknowledgement from the
Commission that the Program is an acceptable part of Rocky Mountain’s program portfolio, as
well as a finding that it should be allowed to continue. The Company believes that future
DECISION MEMORANDUM 2
administrative costs associated with the Program could be lessened by the removal of the
Company’s obligation to perform future Program evaluations.
During the three-year evaluation period, the Company offered the agencies a 75%
reimbursement for the cost of installing approved measures and a 15% reimbursement for
administrative costs. A cap of $150,000 per year in program funding was established over the
three-year period. Rocky Mountain stated that the remainder of the costs for installed measures
not subject to reimbursement from the Company, 25%, is obtained by the individual agencies
from federal funding sources.
Rocky Mountain noted that Commission Order No. 32196, Case No. PAC-E-10-07,
increased the annual Program funds available from a maximum of $150,000 to $300,000. Rocky
Mountain’s contribution to the agencies for the cost of installing approved measures was also
increased from 75% to 85% of the cost of approved measures. The 15% administrative cost
reimbursement remains in place.
The Program evaluation performed by The Cadmus Group, Inc. includes the review
of processes and impacts. It estimates the kWh savings achieved through billing analyses, as
well as estimates for non-energy benefits. Rocky Mountain argues that its entire portfolio of
energy efficiency programs is cost-effective. However, the Company argues that Schedule 21 is
not cost-effective when viewed from the Total Resource Cost (TRC), Utility Cost (UCT) or
Ratepayer Impact (RI) perspectives, unless non-energy benefits are included. The TRC test
indicates that Schedule 21 is cost-effective if non-energy benefits are factored into the analysis.
Rocky Mountain’s analysis included only the Company’s costs of administering the Program and
did not include any funds the agencies may have received from federal sources.
In summary, Rocky Mountain wants to discontinue further evaluations of Schedule
21, Low Income Weatherization Services Optional for Income Qualifying Customers, because
the Company believes that the additional costs of Program evaluations will further erode the
cost-effectiveness of the Company’s demand-side management programs. The Company
believes that its position is supported by the independent evaluation conducted by The Cadmus
Group, attached to its Application. Rocky Mountain believes that this case should be processed
through Modified Procedure.

DECISION MEMORANDUM 3
STAFF RECOMMENDATION
Staff has reviewed Rocky Mountain’s Application and agrees with the Company’s
request to process the Application through Modified Procedure. However, Staff believes that a
workshop may be necessary in order to work through the issues involved in this case. Thus, it
may be helpful to establish an intervention deadline in order to specifically identify the parties
who wish to participate in a subsequent workshop.
COMMISSION DECISION
Does the Commission wish to process Rocky Mountain’s Application through
Modified Procedure with a 90-day comment period and a 14-day deadline for intervention?

M:PAC-E-11-13_np