20220113Comments.pdf

EzuCK SHANER
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
IDAHO BAR NO. 5214
IN THE MATTER OF THE APPLICATION
OF AVISTA CORPORATION FOR AN
ORDER AUTHORIZING PILOT
PROGRAMS FOR THE RESEARCH AND
DEVELOPMENT OF ELECTRIC
TRANSPORTATION
i i'"
Street Address for Express Mail:
I I331 W CHINDEN BLVD, BLDG 8, SUITE 201-A
BOISE, ID 83714
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
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CASE NO. AVU-E-21-I3
COMMENTS OF THE
COMMISSION STAFF
STAFF OF the Idaho Public Utilities Commission, by and through its attorney of record,
Erick Shaner, Deputy Attorney General, submits the following comments.
BACKGROUND
On August 30,2013, Avista Corporation dba Avista Utilities ("Company") applied for
authorization to fund up to $300,000 per year for select Research and Development ("R&D")
efficiency projects, Case No. AVU-E-I3-08. The $300,000 per year of applied R&D funding
would be a ceiling and not a requirement that the Company allocate the funding to R&D in any
given year. Any remaining balance (not earmarked) would roll over to a future year and, if
terminated, the unallocated portion would be added back to the Rider balance. AVU-E-13-08
Application at 5.
On October 31,2013, the Commission granted the Company's Application for Case No.
AVU-E-I3-08 and stated the "Company may fund up to $300,000 per year of R&D." Order No.
32918 at 3.
ISTAFF COMMENTS JANUARY 13,2022
On August 13,2021, the Commission ordered that the Company may continue with its
R&D programs that it has already committed to fund but before committing to future R&D
programs the Company shall propose and seek approval of an updated R&D program that
includes metrics and measurable targets. Order No. 35129 at9.
On September 9, 2021, the Company applied for authorization to implement pilot
programs for electric transportation in Case No. AVU-E-2l-13. Application at 1 and 11. The
Company plans to offer and fund the programs under electric tariff Schedule 90 and Schedule 91.
Id. at 1. The Company requested an effective date of November 7,2021. Id. The Company also
requested that its filing be processed under Modified Procedure by written comment. Id. The
Company included two attachments in support of its Application: a) Exhibit No. I - Avista
Electric Vehicle Supply Equipment Pilot Final Report; and b) Exhibit No. 2 - Avista
Transportation Electrification Plan. Id. at2.
On October 22,2021, the Commission issued a Notice of Application and suspended the
effective date for 30 days plus five months from November 1, 2021, or until the Commission
enters an earlier order accepting, rejecting, or modifuing the proposed changes. Order No.
3s205.
STAFF ANALYSIS
Staff reviewed the Company's Application and additional information provided by the
Company through discovery. Staff recommends the Commission approve the Company's
proposed Electric Vehicle ("EV") Pilot program using the previously approved annual $300,000
of R&D funds. Staff recommends amounts in excess of the $300,000 R&D cap be deferred to a
regulatory asset account for recovery at a later date.
Staff s recommendation of approval for the EV pilot program R&D funding should not
be construed as a determination of prudence for any particular R&D expenditure. The
Commission will review the prudence of DSM expenditures, including R&D expenses in the
Company's biennial DSM prudency cases.
2STAFF COMMENTS JANUARY 13,2022
The Pilot
In Response to Production Request No. 16, the Company o'proposes a three-year pilot
length for the entire electric transportation programs proposed in the Application, beginning in
2022 and concluding in2024." The EV pilot would cost about $410,000 annually and focus on
two main areas.
The first area of focus includes "integrated charging, on-site renewables, and battery
storage research." For this area of focus the Company proposes:
(1) to develop and implement a research project and report summarizing the
current state of integrated stations, (2) develop a parametric model used to
identiff variable cost factors and resulting charging outputs on an ongoing basis,
and (3) a construction project design and implementation plan with estimated
costs and benefits.l
The Company estimates a cost of approximately $50,000 annually to complete the first
area of focus by the end of the 3'd quarter of 2023.2
For the second area of focus, the Company proposes to use lunds for a "workplace, fleet,
and rural access charging infrastructure" program. The charging infrastructure program will
consist of an "estimated 30 sites per year, broken down by 20 workplace, 5 fleet, and 5 rural
access location, at an estimated cost of $345,000," and will include $15,000 per year of ongoing
maintenance and load management costs. Application at 9. The Company's total annual
expenses for this area will be approximately $360,000 and will conclude in2024. Response to
Production Request No. 15.
Financials
The Commission stated that the Company may "continue with its R&D programs that it
has already committed to fund but before committing to future R&D programs the Company
shall propose and seek approval of an updated R&D program." Order No. 35 129 at 9. In
Response to Production Request Nos. 17 and 18, the Company stated that three R&D projects
contracted for in 2021will conclude in202l. As of December 12,2021, the Company had spent
$186,306.80 of the annual $300,000. Additionally, the Company stated that the Company does
not expect to carry over any unused funds into 2022.
rApplication at 8.
2 Response to Production Request No. 7-9
STAFF COMMENTS J JANUARY 13,2022
Beginning in2022, "the Company proposes to fund the EV pilot program under its
electric tariff Schedule 91, as they will be provided under the Market Transformation Program
and associated Research and Development (R&D) outlined in tariff Schedule 90." Application
at 9.
Staff recommends the Commission approve the Company's request to fund the EV pilot
program using the $300,000 of R&D funding. For funding exceeding the $300,000, Staff
recommends it be deferred into a regulatory asset account and future recovery of the deferral be
determined at a later date following the pilot period. Based on the Company's estimated cost of
$410,000 annually, this would leave $110,000 to be deferred into a regulatory asset account.
Staff Overview
Based on the Company's program proposal, Staff does not see the Company's EV pilot
program as a market transformation program focused on energy savings of electricity. In
Response to Production Request No. 6, the Company stated, 'othe most impactful energy
efficiency and overall cost savings are realized by the use of electricity as a transportation fuel,
rather than petroleum-derived fuels such as gasoline and diesel." With the majority of potential
energy savings being attributed to transportation by using alternative fuel sources for vehicles,
the major benefits of this EV pilot will not result in electricity energy savings. Rather the intent
is to study EV penetration and EV customers' charging habits on the Company's distribution
grid.
Staff recognizes the likelihood of increased EV penetration in the Company's service
territory and views the EV pilot as an R&D project to better understand the grid impact of EV
charging. Understanding how and when EV customers will charge their vehicles by making
charging stations available in alternative locations such as at the workplace, will allow the
Company to best optimize its distribution system to better prepare itself for future EV
penetration.
For these reasons, Staff recommends the Company either adjust their proposal to limit the
use of R&D funding for this program to $300,000 or defer excess expenses into a regulatory
asset account. However, Staff supports the Company carrying over unused R&D funds from
2021 to fund the EV pilot program. This would allow approximately $l 13,693 to carry forward
into 2022.
4STAFF COMMENTS JANUARY 13,2022
The Commission stated, "we realize that R&D alone does not guarantee short or long-
term benefits, but we would like to see the Company prioritize results that can generate benefits
for Idaho customers." Order No. 35129 at 8. Staff believes the Company's EV pilot proposal
using R&D funds complies with the Commission Order. The EV pilot will be able to provide
valuable research and information to help the Company effectively manage EV penetration over
both the short and long term, resulting in a more effective use of the Company's resources.
Tariff Rider
At the beginning of 2021, the Company's Electric Tariff Rider balance was overfunded
by $97,188. By the end of the November of 2021, the Company's Electric Tariff Rider balance
was underfunded by $3,225,757. Staff recommends the Company monitor the Tariff Rider
balance, projected expenses, and projected revenue trend. If the Company continues to
experience a downward trend in the Tariff Rider balance, the Company should adjust the Tariff
rider.
Reporting
In Order No. 32918, the Commission requested the Company include "metrics and
measurable targets" in their request for approval to continue funding R&D programs. The
Company states that it will include financial reporting of the programs, but the programs will not
be accompanied by a cost-effectiveness test because it is characterized as R&D and a market
transformation project. Application at 10. In Response to Production Request No. 10, the
Company provided additional metrics and measurable targets for the proposed programs. The
Company states:
Project milestone progress to target dates, and actual to target spending will be
tracked and reported annually for each of the three areas of the integrated
charging, on-site renewable, and battery storage research project, along with a
narrative description of the work completed and remaining to successful project
completion.
Metrics for the workplace, fleet, and rural access charging infrastructure program
will also be reported annually, including installation site information, install costs,
O&M costs, oZ uptime, energy consumption and customer satisfaction. Customer
fuel cost savings and emissions reductions may be derived from customer
information and energy consumption. A narrative will be included with the
metrics information, providing more background information on program
activities and insight.
5STAFF COMMENTS JANUARY 13,2022
In the reporting sections to be included in the Company's DSM report, Staff recommends
all of the above-mentioned metrics in Response to Production Response No. 10, and metrics in
the Application be included in the Company's reporting of the EV pilot. For the charging
infrastructure progrzrm, Staff also recommends the Company include data and metrics on average
hourly energy consumption with breakdowns by charging area (workplace, fleet, rural), the
different types of chargers (i.e., DC fast chargers), different industry segments (i.e., agricultural,
construction, retail, service, etc.), month, and season. For comparative analysis, Staff would also
like the Company to identifu the average hourly peak energy consumption and identifu the
highest risk hours for the Company's system broken down by month and season.
In addition to these reporting requirements, Staff recommends a cumulative report be
included for the entire pilot period including all the metrics and targets specified above when the
program concludes in 2024.
All reports, parametric models, and construction project design and implementation plans
should be provided to the Commission when the work for "integrated charging, on-site
renewables, and battery storage research" is complete in2023.
STAFF RECOMMENDATION
Staff recommends the Commission approve the Company's proposed EV Pilot program
and $300,000 per year of R&D funds. Staff recommends that funds that exceed the $300,000
R&D cap be deferred to a regulatory asset account for recovery in a future proceeding after a
prudence review. Staff also recommends the Commission require the Company to provide
annual reports and a cumulative report as described above for the EV pilot program.
Respectfully submitted this 13rH day of January 2022
Erick Shaner
Deputy Attorney General
Technical Staff: Taylor Thomas
Kevin Keyt
Chris Hecht
i :umisc:comments/avue2 I . I 3esttkskcwh comments
6STAFF COMMENTS JANUARY 13,2022
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 13TH DAY OF JANUARY 2022,
SERVED THE FOREGOING COMMENTS OF' THE COMMISSION STAFF, IN
CASE NO. AVU-E-2T-13, BY E-MAILING A COPY THEREOF, TO THE
FOLLOWING:
SHAWN BONFIELD
SR. MGR. OF REGULATORY STRATEGY
AVISTA CORPORATION
PO BOX3727
SP0KANE, WA 99220-3727
E-MAIL: [e-mail]
dockets@avi stacorp. con't
BENJAMIN J OTTO
ID CONSERVATION LEAGUE
710 N 6TH ST
BOISE ID 83702
E-MAIL : botto(0idahoconservation.or:g
DAVID J MEYER
VP & CHIEF COUNSEL
AVISTA CORPORATION
PO BOX3727
SPoKANE WA99220-3727
E-MAIL: [e-mail]
EMMA E SPERRY
ID CONSERVATION LEAGUE
7IO N 6TH ST
BOISE ID 83702
E-MAIL: [e-mail]
JD,4Z.-,1
SECRETAY
CERTIFICATE OF SERVICE