20041214Idaho Irrigation Pumpers.pdf

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Randall C. Budge
RACINE, OLSON, NYE, BUDGE &
BAILEY, CHARTERED
O. Box 1391; 201 E. Center Street
Pocatello, Idaho 83204-1391
Telephone: [phone]
Fax: [phone]
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BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE
APPLICATION OF IDAHO POWER
COMPANY FOR AUTHORITY TO
IMPLEMENT AN IRRIGATION
PEAK CLIPPING PROGRAM.
CASE NO. IPC-O4-
IDAHO IRRIGATION PUMPERS
ASSOCIATION INC.S COMMENTS
COMES NOW the Idaho Irrigation Pumpers Association, Inc. ("Irrigators ), through counsel
and submit the following Comments in response to the Commission s Order No. 29644 on Idaho
Power s Application requesting authorization to implement the Irrigation Peak Clipping Program
throughout its service territory. The Irrigators strongly support implementing an Irrigation Peak
Clipping Program ("Program ) throughout Idaho Power s service territory for the upcoming
irrigation season. The Irrigators take this opportunity to express appreciation to the Company, the
Commission and Staff for their efforts and support in developing and implementing the Pilot
Program, monitoring and evaluating the results and moving towards full Program implementation.
While some of the terms and details may require further review as will be addressed below
implementation should not be delayed, and the Irrigators support processing the Application by
Modified Procedure without a hearing.
It is well recognized that Idaho Power has changed from a winter peaking, energy constrained
utility to a summer peaking, capacity constrained utility. The substantially increasing summer peaks
has resulted primarily from dramatic growth in the air conditioning load driven by residential and
commercial customers. The irrigation load has remained unchanged the past 20 years and has not
caused any peak or other load growth. However, since Irrigators use a large amount of electricity
during the summer months, they are good candidates for demand reduction during the critical
IDAHO IRRIGATION PUMPERS ASSOCIATION, INC.S COMMENTS - 1
summer peak.
The Company s 2004 IRP identified the Program as a cost-effective capacity resource and
included the Program in its final diversified resource portfolio. The Company s report on the Pilot
Program which was shared with the Irrigators, concluded that the Pilot was very successful and that
it achieved significant load shifting from peak to off-peak periods, thus reducing demand, without
any statistically significant change in overall energy consumption. The Irrigators expect system-
wide implementation of the Program to be at least as successful as the Pilot, if not more, because the
Program has lowered the participation level from 150 to 100 hp pumps and increased the demand
credi t.
All customers can expect to benefit by reducing the need for new peak capacity resources.
Irrigators that are able to participate will benefit from reduced pumping costs. This is critically
important now and is expected to be more so in the future. This is because ground water pumpers
are facing new and escalating water costs to avoid delivery calls and provide mitigation to senior
surface water right holders, together with disproportionately large electric rate increases. As
demonstrated in the last general rate case and expected in future more frequent rate cases, Idaho
Power is advocating new cost of service methodologies that allocate more new peak load costs to
Irrigators even though they are not causing growth.
While the Irrigators support the Program, both the Company s Application and the report on
the Pilot Program lack information and leave questions unanswered regarding: (1) why the schedule
of interruptibility is limited to four hours per day on one, two or three days per week during the
months of June, July and August; (2) how the demand credit was arrived at and the reason for the
differential between the days per week of interruption; and (3) the number and type of irrigation
customers eligible for the Program. Each of these areas will be briefly discussed. The Irrigators will
be participating in direct discussions with the Company and Staff in an effort to obtain more
information, but due to time constraints this will not occur until the Comment deadline.
(1)Ihe Interruptili.ill..ty Schedul~
Idaho Power has proposed to use timers to operate what appears to be a rather rigid
interruption schedule of four hours per day (between 4:00 pm and 8:00 pm) on one, two or three days
per week during the months of June, July and August. Since the objective of the Program is to
reduce peak demand, greater participation would be encouraged by providing more flexible options.
IDAHO IRRIGATION PUMPERS ASSOCIATION, INC.S COMMENTS - 2
This could be provided by giving customers more options such as on up to five week days per week
and four, six or eight hours per day.
Part of the reasons given by the Company for the limited interruptions is: "In order to
discourage a decreased crop yield or the over-sizing of irrigation equipment." It should be of no
concern to Idaho Power if the farmer is willing to choose a higher billing credit in exchange for
decreased crop yield, or if a farmer chooses to spend capital to improve or alter a water delivery
system. Enhancing the Program to maximize the Company s ability to reduce peak demand should
be the objective and only concern of Idaho Power.
(2)The Level of CredltJor Interruptilillity
No information has been provided that explains the underlying basis for the level of credit
nor how it was calculated. For that reason, it is not possible for the Irrigators to evaluate or comment
on the proposed demand credit. From the Company s report on the Pilot Program, it is known that
to achieve results high participation levels are needed; and, further, that higher incentive levels are
the driving factor in participation. The results of customer surveys discussed in their report made
it clear that increasing the incentive was the primary factor that would make the Program more
appealing and encourage participation. While the Program does increase the demand credit over the
Pilot, the basis for the increase and amount is unknown.
Additionally, there is a substantial differential in the demand credit for one day ($2.01 per
kW), two days ($2.51 per kW), and three days ($2.76 per kW) per week of participation. As
proposed, an irrigator interrupted three days per week receives only 37% more credit, while
providing 200% more interruption, when compared with an irrigator that is interrupted only once
per week. The rationale for this differential needs to be further explained and justified.
(3)The Number and Type of Irrigation Customers Eligible
The proposed Program sets a minimum of 100 hp for participation, compared with the Pilot
Program minimum of 150 hp. The Irrigators recognize that there should be some practical limit to
ensure that the benefits derived from the participating customer outweigh the Program costs
including the cost of the timer. However, no cost data has been provided, and the rationale for the
100hp minimum is unknown. Though not necessarily better or preferable, PacifiCorp, on the other
hand, allows all irrigation customers to participate in its program, but the customers are required to
pay for the installation of the timers. While the Irrigators are not advocating such a procedure, some
IDAHO IRRIGATION PUMPERS ASSOCIATION, INc.'s COMMENTS - 3
analysis of the relationship between the cost of the program and the associated credits appears
necessary .
CONCLUSION
The Irrigators highly favor system-wide implementation of an Irrigation Peak Clipping
Program system-wide for the upcoming irrigation season. The key results of the Pilot Program
indicate that it was very successful, achieved significant load shifting from peak to off-peak periods
thereby reducing demand, without any significant change in overall energy consumption. The
proposed Program has been improved over the Pilot to increase the demand credits and lower the
minimum participation level to 100 hp, which should make it more successful.
The Irrigators believe that the Program should be less rigid and provide greater flexibility and
choice in the number of hours available for interruption each day and the number of days available
each week to encourage maximum participation. The Company s Application and the report on the
Pilot Program do not provide adequate information to understand, evaluate and comment on the
proposed interruptibility schedule, the level of demand credits and variability per day, and the
number and type of customers eligible. Additional information is required on these issues and is
expected from the Company on a cooperative basis, but not prior to the Comment deadline.
Approval of the Program in principle should be given so progress can move forward towards
implementation, although additional time is needed to address the questions raised.
RESPECTFULLY SUBMITTED this 14th day of December, 2004.
RACINE, OLSON, NYE, BUDGE &
BAILEY, CHARTERED
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RANDALL C. BUDGE
IDAHO IRRIGATION PUMPERS ASSOCIATION, INC.S COMMENTS - 4
CERTIFICATE OF MAILING
I HEREBY CERTIFY that on this 14th day of December, 2004, I mailed a true and complete
copy of the foregoing document, postage prepaid, to each of the following:
Jean Jewell, Secretary
Idaho Public Utilities Commission
o. Box 83720
Boise, Idaho 83720-0074
Monica Moen
Idaho Power Company
O. Box 70
Boise, Idaho 83707
Timothy Tatum
Idaho Power Company
O. Box 70
Boise, Idaho 83707
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RANDALL C. BUDGE
IDAHO IRRIGATION PUMPERS ASSOCIATION, INC.S COMMENTS - 5