20160208_4896.pdf

DECISION MEMORANDUM 1
DECISION MEMORANDUM

TO: COMMISSIONER KJELLANDER
COMMISSIONER RAPER
COMMISSIONER ANDERSON
COMMISSION SECRETARY
COMMISSION STAFF

FROM: NEIL PRICE
DEPUTY ATTORNEY GENERAL

DATE: FEBRUARY 5, 2016

SUBJECT: APPLICATION OF PACIFICORP DBA ROCKY MOUNTAIN POWER
FOR AUTHORITY TO INCREASE SCHEDULE 191 CUSTOMER
EFFICIENCY SERVICES RATE, CASE NO. PAC-E-16-02

On January 19, 2016, PacifiCorp dba Rocky Mountain Power (“Rocky Mountain” or
“the Company”) submitted an Application to the Idaho Public Utilities Commission
(“Commission”), pursuant to RP 052, RP 201, Idaho Code §§ 61-301, 61-301, 61-307, 61-622,
and 61-623, seeking authority to increase the Schedule 191 Customer Efficiency Services Rate to
2.70% in order to recover costs associated with acquiring and administering cost-effective
demand-side management (“DSM”) programs in its Idaho service territory. The Company
proposes an April 1, 2016 effective date for the increase.
On January 22, 2016, Idaho Conservation League (“ICL”) filed a Petition to Intervene
in this case. On February 3, 2016, the Commission granted ICL’s Petition. See Order No.
33461.
APPLICATION
In its Application, Rocky Mountain included some background regarding the
implementation of its Schedule 191 rate. Rocky Mountain mentions that it has offered a variety
of demand-side management programs to its customers since the 1970s. The Company states
that the Commission initially approved cost-recovery of DSM programs through Schedule 191,
Customer Efficiency Services Rate, which was applied to customers’ bills beginning May l,
2006. The collection rate was originally set at 1.5%. Subsequently, the collection rate has
fluctuated but is currently at 2.10%. Rocky Mountain argues that in order to closer align
DECISION MEMORANDUM 2
Schedule 191 revenues with projected expenditures the Company proposes to increase the
Schedule 191 collection rate from 2.10% to 2.70%.
Rocky Mountain further explained that, in November 2014, the Commission
approved the Company’s application to consolidate three of its non-residential energy efficiency
programs into a single new program called wattsmart Business. According to the Company, its
DSM expenditures increased approximately 38% from $3.2 million in 2014 to $4.4 million in
2015. Rocky Mountain attributes this $1.2 million increase to the wattsmart Business sectors.
The Company claims that the increased expenditures produced a corresponding increase in
kilowatt-hour savings.
Rocky Mountain estimates that Class 2 savings at site increased from 11,410
megawatt hours (MWh) in 20l4 to approximately 15,440 MWh in 2015, a 36% increase. The
Company’s current forecast for DSM expenditures in 2016 and 2017 ranges from $4.4 to $5.0
million per year, included as Attachment B to Rocky Mountain’s Application.
As stated above, Schedule 191 rate is currently at 2.10%. The Company’s
Application provided calculations demonstrating that at the current level of 2.10% annual
Schedule 191 revenues would be approximately $3.947 million, see Attachment A.
Attachment B to Rocky Mountain’s Application summarizes the actual monthly DSM
expenditures and Schedule 191 revenue collection through December 31, 2015, with a net
receivable balance owed to the Company of $0.7 million. Attachment B also shows that at the
current Schedule 191 rate, the DSM balancing account will be under-collected by approximately
$1.2 million as of December 31, 2016.
Attachment C contains the same balancing account analysis as Attachment B except
the Schedule 191 rate is adjusted to 2.70%, effective April 1, 2016, as proposed in this
Application. The Company projects that, assuming the 2.70% rate for Schedule 191 revenue
with an April l, 2016 effective date, the balance in the deferred account will be under-collected
by approximately $280,000 as of December 31, 2016.
Attachment D contains a clean and legislative copy of the Company’s revised tariff
sheets for Schedule 191. The Company also provided copies of the press release and customer
bill insert as Attachment E to the Application. The Company states that the bill inserts were
included in customer’s bills by January 26, 2016, and will continue through a full billing cycle.
DECISION MEMORANDUM 3
In summary, in order to address the current under-collection balance alleged by
Rocky Mountain and keep it from continuing to grow, the Company proposes to increase the
Schedule 191 rate to 2.70%. The Company estimates that the proposed 0.6% increase in the
Schedule 191 rate will result in the collection of approximately $5.1 million on an annual basis.
COMMISSION DECISION
Does the Commission wish to process Rocky Mountain’s Application through
Modified Procedure with a March 16, 2016 deadline for written comments?

/s/ Neil Price
Neil Price
Deputy Attorney General

M:PAC-E-16-02_np