20061108Comments.pdf

WELDON B. STUTZMAN
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
IDAHO BAR NO. 3283
RECEIV?::O
200& NDY -8 PM 2: '5
IDAHO FUbLlC
, ,
UTILITIES COMMISSIOi\j
Street Address for Express Mail:
472 W. WASHINGTON
BOISE, IDAHO 83702-5983
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION OF
IDAHO POWER COMPANY REQUESTING
APPROVAL OF REVISIONS TO ITS
IRRIGATION PEAK REWARDS PROGRAMSCHEDULE 23.
CASE NO. IPC-O6-
COMMENTS OF THE
COMMISSION STAFF
COMES NOW the Staff of the Idaho Public Utilities Commission, by and through its
Attorney of record, Weldon B. Stutzman, Deputy Attorney General, and in response to the
Notice of Application and Notice of Modified Procedure issued in Order No. 30149 on October
, 2006, submits the following comments.
BACKGROUND
On September 18 , 2006, Idaho Power Company filed an Application requesting approval
of changes to its Irrigation Peak Rewards Program, Schedule 23. The Irrigation Peak Rewards
Program is a voluntary load control program available to agricultural irrigation customers who
use pumps having a cumulative horsepower rating of 100 or greater. The program is intended to
decrease the Company s summer system peak by interrupting specified irrigation equipment
between the hours 4:00 p.m. and 8:00 p.m. on one, two or three days per week during the months
of June, July and August. In Case No. IPC-05-28 the Commission encouraged Idaho Power to
conduct a workshop with interested parties to determine whether revisions to the program would
STAFF COMMENTS NOVEMBER 8, 2006
be appropriate. As a result of the workshop, Idaho Power filed its Application to revise the
program.
Idaho Power proposes to make two revisions to the program. First, the demand credit for
the two days per week and three days per week interruptions would be increased, as set forth in
the following schedule:
Interruption Option
Option I (1 day per week)
Option 2 (2 days per week)
Option 3 (3 days per week)
Current Demand Credit per kW
$2.
$2.
$2.
Proposed Demand Credit per kW
$2.
$3.
$4.
The second revision is to reduce the horsepower limit to make the program available to irrigators
using pumps rated at 75 horsepower or higher. An installation fee of$250 would be assessed for
new program participants with irrigation pumps between 75 and 99 horsepower if it is necessary
to install a timer on the pumps.
STAFF ANALYSIS
Staff participated in the Company s workshop and agrees with the proposed changes as
presented in the Company s Application. The workshop for developing the proposed changes
was a constructive process and if approved, the program changes will likely provide significant
increases in benefits to the Company, its customers and the Irrigators. It is anticipated that the
proposed changes will result in a 30-year Program cost effectiveness ratio of approximately 1.04.
Staff believes that the credits available to eligible customers under the proposed options
are appropriate and have been calculated as a reasonable incentive during the peak hours of 4:00
to 8:00 pm. With the proposed changes, Option 1 credits remain the same, Option 2 credits
increase by 34%, and Option 3 credits increase by 58%. Increasing Option 3 credits to $4.
offsets the full demand charge for agricultural customers under Schedule 24. According to the
Company, the proposed Program modifications are expected to result in an additional 4 MW
(including losses) of cost-effective load reduction during the Company s summer peak. Under
the revised Demand Credit structure, it is expected that approximately 13% of the customers
currently participating under Interruption Option 1 will shift to Interruption Options 2 and 3.
The shift in customers from a single day interruption schedule to a multi-day interruption
STAFF COMMENTS NOVEMBER 8, 2006
schedule is expected to produce an additional 3 MW (including losses) of summer peak load
reduction.
The other proposed change to the Program is designed to allow more customers to
participate. The proposal is to reduce the cumulative horsepower requirement for Program
eligibility to 75. The reduction in the horsepower limit is expected to increase participation in
the Program by approximately 140 Metered Service Points. The additional Metered Service
Points resulting from the reduced horsepower limits are expected to produce an additional 1.
MW (including losses) of summer peak load reduction. Staff reviewed this proposed change and
is convinced that irrigation pumps operating below 75 horsepower are not economically viable as
Program participants. Therefore, in order for the Company to institute cost-effective changes to
the Program, Staff supports the proposed change to reduce the pump limits to 75 horsepower.
Additionally, Staff supports the request of the Company to charge an installation fee of $250 to
customers with pumps ranging from 75 to 99 horsepower. The $250 installation fee is designed
to enable pumps with less than 100 horsepower to match the cost effectiveness ratio of 100
horsepower pumps at 0.97.
The Company proposes to maintain the interruption period from 4:00 to 8:00 pm. Based
on results of the Company s survey of 2006 Program participants, information suggested that
most customers preferred the current time frame. Staff agrees that the interruption period of 4:00
to 8:00 pm is appropriate. However, Staff believes that many Program participants would like
some flexibility in the interruption time period and recommends that the Company continue to
consider timing options as a Program improvement.
Finally, one other proposed change in the Program is to allow the Company to charge a
$100 fee for customers who request to reduce interruption options during the irrigation season.
This fee is to recover costs associated with reprogramming the timer located at the customer
service point. Staff finds that this fee is reasonable and recommends that it be approved.
Overall, Staffis convinced that the Company has strived to make positive improvements
to the Peak Rewards Program and complements the Company s collaborative effort. Staff
anticipates the proposed changes will benefit the Company and Irrigation customers. Staff
appreciates the workshop process that was implemented for preparing the proposed changes, and
believes it would be an excellent format for future review of the Program.
STAFF COMMENTS NOVEMBER 8, 2006
STAFF RECOMMENDATION
Staff recommends that the Commission approve revisions to Schedule 23, Irrigation Peak
Rewards Program as proposed by the Company. Staff also recommends the Commission issue
an Order by December 15 2006 to allow sufficient time for the Company to market and
implement the proposed changes prior to the 2007 irrigation season.
Respectfully submitted this day of November 2006.
-"-:.--
Weldon B. Stutzman
Deputy Attorney General
Technical Staff: Dave Schunke
Mike Darrington
ws :uumisc/comments/ipceO6.22wsdesmd
STAFF COMMENTS NOVEMBER 8, 2006
CERTIFICATE OF SERVICE
HEREBY CERTIFY THAT I HAVE THIS 8TH DAY OF NOVEMBER 2006
SERVED THE FOREGOING COMMENTS OF THE COMMISSION STAFF IN CASE
NO. IPC-06-, BY MAILING A COpy THEREOF, POSTAGE PREPAID, TO THE
FOLLOWING:
BARTON L KLINE
MONICA B MOEN
IDAHO POWER COMPANY
PO BOX 70
BOISE ID 83707-0070
9JLa~.
SECRETARY
CERTIFICATE OF SERVICE