20070104notice_of_application_ipc32.pdf

Office of the Secretary
Service Date
January 4, 2007
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION
OF IDAHO POWER COMPANY TO
IMPLEMENT A DEMAND SIDE
MANAGEMENT INCENTIVE PILOT
PROGRAM
) CASE NO. IPC-O6-
NOTICE OF APPLICATION
NOTICE OF
MODIFIED PROCEDURE
NOTICE OF
COMMENT/PROTEST DEADLINE
YOU ARE HEREBY NOTIFIED that on December 18, 2006, Idaho Power
Company (Idaho Power; Company) filed an Application with the Idaho Public Utilities
Commission (Commission) requesting authority to implement a pilot program that provides for
positive incentives (increased revenue or payments) or negative incentives (reduced revenue or
penalties) for achieving, or failing to achieve, agreed-upon levels of performance in
implementing demand-side management (DSM) programs.
Idaho Power proposes that the DSM incentive program first be operated as a pilot
program and only applied to a single DSM program for a three-year period. The Company
Application is separate from but related to the Joint Motion for Approval of Stipulation filed
December 18, 2006 in Case No. IPC-04-15 (Application to Implement a Decoupling
Mechanism).
Proposed Pilot Program
Idaho Power in this Application requests authority to implement a DSM incentive
mechanism which would allow the Company to retain a portion of the cost-reducing benefits
accruing from a DSM program operated by the Company. The incentive would be earned only if
the Company has done an exceptional job in implementing the DSM program. The incentive
mechanism would also allow for a "penalty" payment by the Company if Idaho Power
performance of the selected DSM program falls below previously agreed-upon goals.
Based on discussions between the parties in the IPC-04-15 case workshops, Idaho
Power has selected the ENERGY STAR(g) Homes Northwest program as the DSM program to be
used as the pilot to test the efficacy of a DSM incentive program. The ENERGY STAR Homes
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
NOTICE OF COMMENT/PROTEST DEADLINE
Northwest program is currently operated by the Company to acquire the resources identified in
the Residential New Construction Option in the Company s 2004 IRP. The essential feature of
this program is a prescriptive building standard, also called a building option package or BOP
that establishes building standards that will result in approximately 30% greater energy
efficiency than existing Idaho residential building codes. Under the program, the Company
provides an incentive payment of $750 to the builder for each home built to the higher standard
and also provides marketing to encourage participation in the program. The Idaho Energy
Division (IED) certifies that homes are built to the standard and conducts a quality assurance
process. The Northwest Energy Efficiency Alliance (NEEA) provides the builder outreach and
training components of the program. On average, a home constructed to the ENERGY STAR
standard in Idaho will save 2 078 kilowatt hours (kWh) annually as measured at the meter or
305 kWh including line losses. This estimate is based on an engineering simulation study,
conducted for the Company in early 2004 by Ecotope Consulting to determine the program
savings potential in Idaho.
The ENERGY STAR Homes Northwest program, the mechanics of the incentive
program proposed by the Company and the rationale supporting the DSM incentive program are
more particularly described in the testimony of Company witness Timothy E. Tatum filed with
the Application.
Idaho Power is proposing a three-year pilot beginning in 2007 and ending at the end
of2009. Under the pilot the Company would receive an incentive payment if the market share of
homes constructed under the ENERGY STAR Homes Northwest program exceeds: (1) 7% of the
total number of homes constructed in Idaho Power s service area in 2007, (2) exceeds 9.8% of
total service area homes in 2008 and (3) exceeds 11.7% of total service area homes in 2009.
These percentage levels would be the target goals and if Idaho Power exceeds these targets, it
would receive an incentive payment equal to the percentage benefit that exceeds the target. For
example, if Idaho Power is able to achieve 105% of the 7% target percentage in 2007 , Idaho
Power would receive a payment equal to 5% of the total program net benefits. The incentive
program would be capped at 10% of program net benefits. Penalties would be levied for 2007
2008 or 2009 if in any of those years Idaho Power s ENERGY STAR Homes Northwest
program fails to reach the market share of 4.9% achieved in 2006.
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
NOTICE OF COMMENT/PROTEST DEADLINE
Idaho Power recommends that the Commission process its Application under
Modified Procedure, i., by written submission rather than by hearing. Reference Commission
Rules of Procedure, IDAPA 31.01.01.201-204. The Company stands ready, however, to present
its testimony and support the program in a technical hearing if the Commission determines that
such a hearing is required.
YOU ARE FURTHER NOTIFIED that the Commission has reviewed the filings of
record in Case No. IPC-06-32. The Commission has preliminarily found that the public
interest in this matter may not require a hearing to consider the issues presented and that issues
raised by the Company s filing may be processed under Modified Procedure e., by written
submission rather than by hearing. Reference Commission Rules of Procedure IDAP A
31.01.01.201-204.
YOU ARE FURTHER NOTIFIED that the deadline for filing written comments or
protests with respect to Idaho Power s Application and the use of Modified Procedure in Case
No. IPC-06-32 is Wednesday, January 31, 2007.
YOU ARE FURTHER NOTIFIED that if no written comments or protests are
received within the deadline, the Commission may consider the matter on its merits and may
enter its Order without a formal hearing. If comments or protests are filed within the deadline
the Commission will consider them and in its discretion may set the matter for hearing or may
decide the matter and issue its Order based on the written positions before it. Reference IDAP
31.01.01.204.
YOU ARE FURTHER NOTIFIED that written comments concerning Case No. IPC-
06-32 should be mailed to the Commission and the Company at the addresses reflected below.
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
NOTICE OF COMMENT/PROTEST DEADLINE
Commission Secretary
Idaho Public Utilities Commission
PO Box 83720
Boise, ID 83720-0074
Street Address for Express Mail:
Barton L. Kline, Senior Attorney
Monica B. Moen, Attorney II
Idaho Power Company
PO Box 70
Boise, ID 83707-0070
E-mail: bkline(fYidahopower.com
mmoen(fYi dahopower. com
472 W. Washington Street
Boise, ID 83702-5983 Ric Gale
Vice President Pricing and Regulatory
Idaho Power Company
PO Box 70
Boise, ID 83707-0070
E-mail: rgale(fYidahopower.com
Street Address for Express Mail:
1221 W. Idaho Street
Boise, ID 83702
All comments should contain the case caption and case number shown on the first page of this
document.Persons desiring to submit comments via e-mail may do so by accessing the
Commission s home page located at www.puc.idaho.gov. Click the "Comments and Questions
icon, and complete the comment form, using the case number as it appears on the front of this
document. These comments must also be sent to Idaho Power at the e-mail addresses listed
above.
YOU ARE FURTHER NOTIFIED that the Application in Case No. IPC-06-
may be viewed at www.puc.idaho.gov by clicking on "File Room" and "Electric Cases " or can
be viewed during regular business hours at the Idaho Public Utilities Commission, 472 W.
Washington Street, Boise, Idaho and at the general business office of Idaho Power Company,
1221 West Idaho Street, Boise, Idaho.
DATED at Boise, Idaho this if
fI..day of January 2007.
Commission Secretary
blslN: IPC-O6-32 sw
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
NOTICE OF COMMENT/PROTEST DEADLINE