20120917SRA Comments.pdf

RECER'EC)
Comments of the Snake River Alliance
In the Matter of the Application of Avista Corporation for Authority to becYeas herEherg
Efficiency Rider Adjustment Schedule 91
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Case No. AVU-E-12-07
Submitted by
Ken Miller, Clean Energy Program Director, Snake River Alliance
Sept. 17, 2012
The Snake River Alliance ("Alliance") appreciates the opportunity to provide comments relating
to the application by Avista Utilities to decrease the amount of its Energy Efficiency Rider rate
(Schedule 91) as filed to this Commission in Case No. AVU-E-12-07, and also in response to the
Commission's Notice of Modified Procedure, Order No. 32621.
The Alliance has long advocated energy efficiency and development of certain renewable
energy resources in the portfolios of Avista Utilities and all regulated electric utilities in Idaho.
As the Commission knows, the Alliance has long supported robust energy efficiency program
development and support through tariff riders and other mechanisms available to Idaho
utilities through Commission orders.
The Alliance does not support the request by Avista Utilities in this case because we view the
request as premature and as having the potential to undermine ongoing attempts to expand
demand-side management (DSM) programs offered by Avista in its Idaho jurisdiction. Many of
our objections to Avista's pending request are similar to those we raised in a similar case earlier
this year in which Rocky Mountain Power sought and received PUC permission to decrease its
customer efficiency services rate.
This Request is Premature
We appreciate the Commission's desire to ensure that Idaho's regulated electric utilities do not
over-collect from customers the funds needed to administer programs of any nature. However,
we are unsure that the applicant has established the case that such a threat exists here. As with
Rocky Mountain Power's application to reduce its efficiency funding, we do not believe there is
a record of ongoing over-collection of demand side management (DSM) funds from customers.
The Commission states in Order No. 32621 that:
"The Company says only 55% of the currently projected electric DSM tariff rider
surcharge revenue is needed to fund the expected DSM operations for the 12 months
following October 1, 2012, given a projected balance of $886,761 at the end of
September 2012. Thus, the Company requests a 45% reduction in the electric DSM tariff
rider surcharge effective October 1, 2012. The Company says the surcharge reduction
would not impact the Company's ability to fund and pursue cost-effective DSM
resources; it will merely adjust revenues to move the tariff rider balance towards zero.
Id. at 3."
It is difficult to conclude that such an abrupt and deep reduction in DSM collections and
spending will not have an impact on existing or future DSM programs. Avista's application at P.
3 states that:
"Avista is proposing substantial reductions to both electric and natural gas DSM tariff
rider surcharges (Schedules 91 and 191 respectively) in recognition of changes in the
future expected expenditures for those programs as well as existing tariff rider balances.
Through June 2012, Avista's Idaho electric DSM tariff rider balance was $316,231
(Company owes ratepayer) and the Idaho natural gas DSM tariff rider balance was
$1,355,23 (Company owes ratepayer).
Avista further states that "Only 55 percent of the currently projected electric DSM tariff rider
surcharge revenue is necessary to fund the expected DSM operations for the 12 months
following October 1, 2012, given a projected positive balance of $888,761 at the close of
September 2012."
We believe that such a short time period in which DSM funds were over-collected and the
magnitude of the over-collections does not allow the Commission to determine the wisdom of
such a dramatic reduction of 45 percent in efficiency rider funds.
As we did with Rocky Mountain Power, we suggest that Avista Utilities be allowed sufficient
time to justify a 45 percent reduction in its energy efficiency rider level. Our preference is that
Avista return to the Commission after such time it has established that the DSM account is
being repeatedly overfunded. There was a reason the rider was set at its current level, and
Avista's application does not fully explain what has changed in the intervening time to warrant
reducing the rider.
The request before the Commission would reduce the Schedule 91 rate by 1.3 percent. The
Company claims that the verified electric savings of 59,002 MWh, or 115 percent of its IRP goal
in 2010-2011, shows the efficacy of its DSM programs, and we agree.
While we do not discount the value of a reduced rider level to many customers, we also believe
the estimated monthly savings of $1.05 on a typical residential bill can be more than offset by
well-designed efficiency programs that deliver an order of magnitude more in customer
benefits (including reduced bills) than saving $12 a year.
When reviewing funding levels for DSM and other energy efficiency measures, we believe the
standard should not be that a utility is concerned about the possibility that it may over-collect
(as may be the case here), but rather that the Commission be presented with evidence that the
utility actually did over-collect. In the event customers are overcharged what by all accounts in
this case is a very small amount of money to support DSM programs, there are mechanisms in
place for the Commission to order over-collected funds to be returned to customers. Reducing
the amount collected in the rider by nearly half, or $3.46 million, does not appear to be
supported in Avista's application, particularly at a time when the Pacific Northwest has
embarked on an aggressive expansion of energy efficiency measures to help utilities meet new
load growth and to help offset generation lost to the retirement of fossil fuel generations.
We agree with the Commission's past findings that Avista's electricity efficiency programs have
merit and that the spending on these programs has been prudently incurred.
The efficacy of the low-income assistance programs alone is evidence that these programs
should be expanded rather than simply maintained at current funding levels or less.
Conclusion
The Alliance shares the Commission's concerns about the impacts rates are having on Idaho
electricity customers. We comment frequently in various cases involving this and other utilities
that have rate impacts, and we impose on the Commission to allow us to intervene in some of
them. We did not so do here, because we believe this matter is clear and also because of the
Commission's decision to process this case through Modified Procedure.
A request to change the level of customer financing of DSM programs - whether higher or
lower - must be accompanied with compelling evidence that a repeated imbalance in
collections is occurring and must be corrected. We do not believe that is yet the case here.
We are not submitting comments in Avista's companion request for its natural gas efficiency
collections (Schedule 191 AVU-G-12-06).
As always, the Alliance is grateful to the Commission for the opportunity to provide its
comments in Case No. AVU-E-12-07 and anticipates participating in future discussions as
appropriate on the issues raised by this docket.
Respectfully submitted,
Ken Miller
Clean Energy Program Director
Snake River Alliance
P.O. Box 1731
Boise, ID 83701
[phone] (o)
[phone] (c)
kmillersnakeriveralliance.org
www.snakeriveralliance.org