20090501Comments.pdf

pi;'~.
WELDON B. STUTZMAN
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
IDAHO BAR NO. 3283
2009 HA Y - 1 Mill:, 4
Street Address for Express Mail:
472W WASHINGTON
BOISE ID 83702-5983
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION OF )
IDAHO POWER COMPANY FOR AUTHORITY )
TO IMPLEMENT MODIFICATIONS TO THE )
PERFORMANCE-BASED DEMAND-SIDE )
MANAGEMENT INCENTIVE PILOT PROGRAM )
)
)
CASE NO. IPC-E-09-4
COMMENTS OF THE
COMMISSION STAFF
COMES NOW the Staff of the Idaho Public Utilties 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. 30777 on
April 10,2009, submits the following comments.
BACKGROUND
In December 2006, Idaho Power filed an Application (Case No. IPC-E-06-32) requesting
authority to implement an incentive mechanism that would allow the Company to retain a
portion of the financial benefits associated with Demand Side Management (DSM) programs
operated by the Company. In March 2007, the Commission issued Order No. 30268 approving a
pilot program to be operational over a three-year period ending December 2009. Under the pilot
program, the Company could receive an incentive payment if the market share of homes
constrcted under the ENERGY STARiI Homes Northwest program exceeded certain levels.
STAFF COMMENTS 1 MAY 1,2009
Conversely, the Company could be subject to a penalty if the percentage of new homes that were
built to ENERGY STARiI standards failed to reach certain levels.
On March 11,2009, Idaho Power Company filed an Application requesting the
Commission issue an Order to (1) authorize the Company to implement a number of
modifications to the metrics used under the Performance-Based Demand-Side Management
Incentive Pilot program to determine incentive eligibilty, (2) approve the Company's
determination of its ENERGY STARiI Homes Northwest market share achievement for the pilot
years of 2007 and 2008, (3) authorize the Company to discontinue the pilot program effective
Januar 1,2009, and (4) initiate workshop proceedings to investigate potential benefits ofa
properly designed DSM incentive mechanism.
STAFF ANALYSIS
Idaho Power's Application described some of the significant problems in developing
standards to determine whether the Company would be entitled to an incentive payment or
subject to a penalty. (Attachment A contains Staffs Comments fied in Case No. IPC-E-06-32,
in which the problems are more fully described on pages 3-7.) After considerable analyses and
discussions, Staff and the Company both acquiesced and sometimes agreed to revised market
share determination methodologies. Under the revisions, the Company neither earned an
incentive payment nor incured a penalty in 2007 and 2008.
The Application in this case asks that some of the metrics used to potentially determine
incentive eligibilty be formally approved by the Commission and that it also approve Idaho
Power's determination of its market share of ENERGY STARiI Homes Northwest in 2007 and
2008. The practical result of the Company's request for approval of the modifications to the
metrics is to affirm the results for 2007 and 2008 for which the Company wil receive neither
penalties nor incentive rewards. Staff supports the requests for approval of the metric
modifications and the results for 2007 and 2008.
The Application also asks that the Pilot Incentive Program be discontinued effective
January 1,2009. Given the continuing difficulties in administering this Pilot Program, Staff
supports the Company's request to discontinue it effective January 1,2009, with no incentive
payments or penalties for 2007 and 2008.
Finally, the Application requests the Commission open a new docket to further explore
development of a DSM performance incentive mechanism that would apply to Idaho Power's
STAFF COMMENTS 2 MAY 1,2009
entire portfolio of DSM programs. Considering the resources that were used to develop just the
ENERGY STARiI Homes Northwest Incentive Pilot and the fact that most of its goal-setting and
measurement issues were never fully resolved, Staff is skeptical of the proposal to expand the
performance incentive concept to the Company's entire DSM portfolio. The goal-setting,
measurement and verification problems that significantly challenged the single-program pilot
wil likely expand if an incentive/penalty mechanism is applied to all programs.
Following is a recap of the history of the investigation into DSM performance incentives.
In Case No. IPC-E-03-13, the Northwest Energy Coalition proposed that the Commission initiate
workshops to investigate Idaho Power's financial disincentives to investing in cost-effective
energy efficiency. In Order No. 29505 (pp 68-69), the Commission stated that such a proceeding
was appropriate and directed that the paries should address both possible revenue adjustments
when consumption changes from normal and performance-based incentives. The Fixed-Cost
Adjustment Pilot (FCA) resulted from the former (Case No. IPC-E-04-15) and the Performance
Incentive Pilot for ENERGY STARiI Homes Northwest resulted from the latter.
It is noteworty that the Performance Incentive Pilot was even more diffcult to develop
and implement than was the FCA Pilot. Idaho Power filed an Application for a two-program
Performance Incentive Pilot (Case No. IPC-E-05-05) in Februar 2005, but withdrew this
Application in April 2005 due to several paries suggesting that other programs may be better
candidates for a performance incentive trial than were the ENERGY STARiI Homes Northwest
and Rebate Advantage programs. Finally, in December 2006, after further analysis and
consideration, Idaho Power filed a second Application for a Performance Incentive Pilot (Case
No. IPC-E-06-32) in which incentives or penalties would be based on results of just the
ENERGY STARiI Homes Northwest program.
In Case No. IPC-E-06-32, Idaho Power sought permission to implement a three-year
DSM performance incentive pilot. In that case, Idaho Power said that its selection of the
ENERGY STARiI Homes Northwest program to test the performance incentive concept was
based upon discussions between the paries in IPC-E-04-15. The Application in the curent case
reiterates the seven technical challenges to the DSM performance incentive pilot as originally
identified by Staff in its comments filed in the 2006 case (see Staff Attachment A for more
detail). These challenges generally continue to impede the workabilty of the ENERGY STARiI
Homes Northwest Performance Incentive Pilot, hence the Company's proposed termination of
this pilot and the Staff s support of such discontinuance. Paradoxically, the Application then
STAFF COMMENTS 3 MAY 1,2009
requests "...that the Commission open a separate docket to investigate and potentially develop a
performance-based incentive mechanism to be applied to Idaho Power's entire portfolio ofDSM
programs."
While Staff is not optimistic that a valid, reasonable and non-contentious performance
incentive mechanism for Idaho Power's portfolio ofDSM programs can be successfully
developed, Staff is nevertheless willng to fully paricipate in workshops to investigate the
concept fuher if the Commission so orders or if paricipation is requested by the Company. If
such additional workshops are held, Staff anticipates that alternative DSM concepts wil also be
discussed, e.g. the benefits of employing a third-pary administrator to implement DSM, as was
suggested by the Industrial Customers ofIdaho Power (ICIP) in Case No. IPC-E-06-32.
STAFF RECOMMENDATION
Staff recommends that the Commission accept modified metrics in the performance pilot
as described in the Application and Idaho Power's determination of its market share achievement
for ENERGY STAR Homes Northwest for 2007 and 2008, and that it authorize termination of
the incentive pilot effective January 1,2009.
Staff does not recommend that the Commission initiate fuher"... workshop proceedings
to investigate the potential benefits of a properly designed, portfolio-based DSM incentive
mechanism applied to Idaho Power," as requested in the Application. Instead, Staf recommends
that the Commission remind the Company that it may itself initiate such an investigation.
Respectfully submitted this r~¡'day of May 2009.
DJ~
Weldon B. Stutzman
Deputy Attorney General
i :umisc: commentslipce09 .4wsla.doc
STAFF COMMENTS 4 MAY 1,2009
F~ f: ~~ E ~ ~/
SCOTI WOODBURY
DEPUTY ATIORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
BARNO. 1895
2001 JI\N 31 PM 2: 07
¡Cf\hO PUbLIC ..
Ii 11'1..... "'0' 'lt 'IC'SII"UT L. it:: i.L . i'lj,~;¡ \. v:
Street Address for Express Mail:
472 W. WASHINGTON
BOISE, IDAHO 83702-5983
Attrney for the Commssion Staff
BEFORE TH IDAHO PUBLIC UTILITIES COMMSSION
IN THE MATTER OF THE APPLICATION OF ).
IDAHO POWER COMPAN TO IMLEMENT )
A DEMA SIDE MAAGEMENT INCENTI )PILOT PROGRA. )
)
)
)
CASE NO. IPC-E-06-32
COMMENTS OF THE
COMMISSION STAFF
COMES NOW the Staff of the Idaho Public Utilities Commssion, by and though its
Attorney of record, Scott Woodbur, Deputy Attorney General, and in response to the Notice of
Application, Notice of Modified Procedure and Notice ofComment/rotest Deadline issued on
Januar 4, 2007, submits the following comments.
BACKGROUND
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 tht 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 perormance 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 progr for a thee-year penod. The Company's Application is
STAFF COMMENTS 1 JANARY 3 L,2QQ7 _ .. ....
Attachment A
Case No. IPC-E-09-04
Staff Comments
05/01/09 . Page lof 8
separate from but related to the Joint Motion for Approval of Stipulation fied December 18, 2006
in Case No. IPC-E-04-15 (Application to Implement a Decoupling Mechansm).
Proposed Pilot Program
In ths Application Idaho. Power requests authority to implement a DSM incetive
mechansm which would allow the Company to ret a portion of the net benefits accruing from a
DSM program operated by the Company. The incentive would be eared if the Company is
"exceptionally successfu" in implementing the DSM progr. Conversely, the incentive
mechasm would requie a penalty payment by Idaho Power if achievement indicators of the
selected DSM program fall below last year's achievement.
Based on discussions betwee the paries in the IPC-E-04-15 cae workshops, Idaho Power
has selected the ENERGY STARlI Homes Nortwest program as the DSM program to be used as
the pilot to test the effcacy of a DSM incentive program. The ENERGY STAR Homes Nortwest
program is curently operated by the Company to acquire the resources identified in the Residential
New Construction Option in the Company's 2004 IRP. The essential featue of ths progr is a
prescrptive building standad, also called a buildig option package (BOP), that is estimated to
result in approxiately 30% greater energy effciency compared to the existig Idaho residential
building code. Under the progr, the Company provides an incentive payment of$750 to the
builder of each home built to the higher standard. The progr also provides marketig to
encourage parcipation in the program. The Idaho Energy Division (IED) cerfies that homes are
built to the stadard and conducts a qualty assurance process. The Nortwest Energy Effciency
Allance (NEA) provides the builder outreach and training components of the program. On
average, a home constrcted to the ENERGY STAR standard in Idaho will save 2,078 kilowatt
hours (kWh) anually as meaured at the meter or 2,305 kWh including line losses. Ths estimate is
based on an engieerng simulation study, conducted for the Company in early 2004 by Ecotope
Consulting to detere the program savigs potential in Idaho.
The ENERGY STAR Homes Nortwest program, the mechancs of the incentive program
proposed by the Company and the rationale supportg the DSM incentive program are more
parcularly descrbed in the testiony of Company witness Timothy E. Tatu filed with the
Application.
Idaho Power is proposing a thee-year pilot beginnng in 2007 and ending at the end of
2009. Under the pilot the Company would receive an incentive payment itthe market share of
STAFF COMMNTS 2 JANARY 31, 2007_......
- Attachment A
Case No. IPC-E-09-04
Staff Comments
05/01/09 Page 2 of 8
homes constrcted under the ENERGY STAR Homes Northwest program exceeds: (1) 7% of the
tota number of homes pertted in Idao Power's serce area in 2007, (2) exceeds 9.8% of tota
servce area homes pertted in 2008 and (3) exceeds 11.7% of total servce area homes pertted
in 2009. These percentage levels would be the taget goals and ifIdaho Power exceeds these
targets, it would receive an incentive payment equal to the percentage benefit that exceeds the
target. For example, ifIdaho 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. Net benefits
for the purose of ths pilot are equal to total Idaho Power benefits less its diect program costs
(excluding NEEA's costs). The incentive program would be capped at 10% of program net
benefits. Penalties, on the other hand, would be levied at a fixed 50% of net benefits lost for 2007,
2008 or 2009 ifin any of those years Idaho Power's ENERGY STAR Homes Nortwest program
fails to reach a market share of 4.9% (or 3.9%) preliminarly estiated as the achievement in 2006.
ANALYSIS
Rewarding Idaho Power for exceptional achievenent in encouraging constction of homes
that are cost-effectively built to reduce both overall energy consumption and peak demand is
conceptually appealig. Clearly, Idaho Power's customers wil benefit if more homes in the
Company's Idaho serce area are built to Energy Sta standads, as opposed to minimum building
code standards.
In seekig a good program to test the DSM incentive concet, Idaho Power said it analyzed
all of its programs for the best candidate. Regardless of ths extensive search for the best program
to tral, the metrcs of the proposed DSM incentive pilot suffer techncal diffculties in the followig
areas: 1) arbitraress in settg reasonable, "average" achievement goals; 2) uncerainty in
measurng the act Energy Star homes percetage achieved; 3) ambiguty in determg what
constitutes "exceptional" and "poor" levels of achievement; 4) potential for rewarding or penalizig
Idaho Power due to factors unelated to its program efforts; 5) necessar but problematic exclusion
of regional marketing costs and benefits; 6) calculating the incentive or penalty using allocation of
joint costs based only on heatig and cooling degree days, not on actual energy savigs or peak
reductions; and 7) uncertainties of average savigs per home and base percent of Energy Sta homes
achieved in 2006. Some of these diffculties wil be encountered with other DSM programs if the
pilot incentive mechasm were eventually extended to them. The numerous challenges warant
close monitorig of this pilot.
STAFF COMMNTS 3 JANUARY 31, 2007
- Attaclie-nt A
Case No. IPC-E-09-04
Staff Comments
05/01109 Page 30f8
The first difficuty, settng reasonable, "average" goals, became apparent durng discussions
pror to the filing of ths Application. Idaho Power had suggested setting Energy Star homes
average goals for 2007 though 2009 equal to those calculable from its 2004 IRP megawatt-hour
savigs potentiallisted in its generc "residential effciency (new constrction)" program.
However, Staff noted that the 2004 IRP savings potentials for 2008 and 2009 were far below Idaho
Power's pro rata shae of regiona goals for Energy Sta Homes Nortwest, which ha had its goals
recently reduced by the Nortwest Energy Effciency Alliance (NEEA). Idaho Power and Staf
ultiately agreed that the Company's goals should minor NEEA's "utility"i goals for the puroses
of ths pilot. Absent NEEA"s relatively independent achievement goals, there would have been no
reasonable benchmark with which to gauge Idao Power's performance objectives. And, given
NEEA's own fluctuating goals and differences in data sources and assumptions, even havig ths
independent benchmark does not completely elimate arbitrarness of settng goals. Expansion of
the incentive concept to other DSM programs, for which there are no independent benchmarks, may
be even more arbitrar and contentious.
The table below compares estiates of Energy Star homes goals based on the two sources
and actual or estimated achievements for 2005 and 2006:
Year NEEAE.S.NEEAIPC-IPC 2004 IPC 2004 est.IPC actual IPC actual
"utility" %equiv. E.S. #IR E.S. #IRE.S. %E. Star #E. Star %
2005 1.2%164 464 3.4%203 1.5 %
2006 3.8%391 675 6.6%400 (est.)3.9%
2007 7.0%681 680 7.0%----......_-
2008 9.8%860 690 7.9%--------
2009 11.7 %905 700 9.0%--------
,
It should be noted that NEEA-derved numbers were interpolated from a June 26, 2006, memo to
NEEA's board of directo'rs and, thus, its 2005 numbers were historical, while Idaho Power's 2004
IRP numbers were all forecast. The table incorporates estimated overall decling growt rates.
1 "Utility" goals ar defied as the estiated numbers of Energy Sta homes for which buiders receive utity rebates
and excludes the estiated increasing numbers of Energy Sta homes that wil be built wiihout rebates.
STAFF COMMENTS 4 JANARY 31, 2007
-AttaclUént A
Case No. IPC-E-09-04
Staff Comments
05/01/09 P_age4oL8
The second diffculty, measurg the actual Energy Sta homes percentage achieved, is due
to not having'an accurate, practicable method of counting tota single-famly homes built in Idaho
Power's serce tertory, to serve as the denomiator in calculatig Energy Sta's percent. Idaho
Power stated.that it does not curently collect ths information and that it would be prohibitively
expensive to do so. Furerore, the Company suggested that home constrction and perit data
are tyically derved from very small samples over wide geographic areas that are diffcult to
reasonably interolate to Idaho Power's specific areas of servce with Idaho. The data source that
Idaho Power decided was the best one publicly available, Wells Fargo Ban Idaho Constrction
Report consists of perts issued for buildig single-family homes in much of Idaho Power's
servce area. Unfortately, ths "best" building perit data source omits many cities and
unncorporated areas in counties sered by Idaho Power. For example, some of the missing cities
are: Eagle, Kuna, Garden City, Star, Middleton, Horseshoe Bend, Greenleaf, New Plymouth
Maring, Homedale, Wilder, Pana, Midvale, Cambridge, Council, New Meadows, Riggis,
Hageran, Buh, Filer, Castleford, Kimberly, Hansen, M~ugh Eden, Hazelton, Oakey,
Aberdeen, Inom. Ths data is also missing the uncorporated areas of at least ten counties in
Idaho Power's serice area, i.e. Adams, Boise, Camas, Elmore, Gem, Jerome, Lincoln, Payette,
Washigton and Owyhee.
An additional problem is tht the data consists of "permits issued" rather th homes
actuly completed. The difference between home perts and home completions is someties
several percentage points. NEEA also uses "perit" data to quantify its goals and achievements,
but it uses the U.S. Census as its source. A curory comparson between Census and Wells Fargo
data reveals signficant differences between places with reported permts as well as with some of the
reported numbers for those places that are on both lists. Idaho Power's actual Energy Star percents
shown in the above table for 2005 and 2006 are based on a combination of Wells Fargo and U.S.
Census permt data. Using only the Wells Fargo pert data for the denominator, as proposed by
Idaho Power, would increase both percentages by about 20%.
If the home-building industr were faily stable, the differences between perts issued in
some, but not all, geographic areas and homes actully completed in all geographic areas might be
suffciently stable so as to allow reasonably fair comparsons of year- to-year changes in Energy Star
homes pecentages. But the home-buildig industr is clearly not stable. Constrction Monitor
data found at ww.constrctionmonitor.com shows that single-famly home perits issued in all of
souther Idaho decreased by nealy 70%, from 783 in December 2005 to just 248 in December
STAFF COMMENTS 5 JANARY 31, 2007
Attac1ient A .
Case No. IPC-E-09-04
Staff Comments
05/01/09 Page 5 of 8
2006. Such a signficat change in permits issued may also result in a change of the ratio. of perts
to houses built and both the perit and ratio changes may var among the geographic areas in and
out of the Wells Fargo data. For-example, from August 2005 to Augut 2006, the Wells Fargo data
shows new dwellng unt perts decreasing by 40% in southwester Idaho, while increasing by 6%
in southeaster Idao. Because of the signficant, disparate changes the housing industr is
experencing, Staff believes it is uneasonable to use Wells Fargo's incomplete permit data as a
surogate for all homes completed in Idaho Power's servce area.
. The third diffculty, settng "exceptional" and "poor" achievement levels, is, at best, an
arbitrar process. In at least the nortwest, Energy Sta homes has a short history of not meeting
established goals. As a result, for the puroses of the Idaho Power's incentive pilot, Staff ultimately
agreed that exceedig the established regional goal of 7.0% Energy Star homes for 2007 would be
an "excetional" achievement, and that falling below 2006's estiated 4.9% (or 3.9%) level would
constitute "poor" performance. These thesholds are obviously not symetrcal arund the 7.0%
"average" performance target, but they seem reasonable given the parcuar circumstances of ths
pilot program especially given the more severe penalty provision of a flat 50% of net benefits lost.
Staff notes that if the proposed DSM incentive mechansm were applied to other programs, those
would also likely requie somewhat arbitrar judgments for "exceptiona" and "poor" performance
levels.
The four diffculty, rewarding or penalizing Idaho Power because of factors unelated to
its Energy Star homes program, is another concer also caused by the rapid decline in home
building. Such a radica change in ths industr may cause more builders to embrace Energy Star as
a competitive way to improve their individua market share, or, alternatively, it may cause more
builders to tu away from the higher constrction costs of Energy Star homes in an effort to
compete on price. We don't yet know which direction most builders will go, but under either
scenaro, to the extent that Idaho Power's Energy Sta homes program success or failure is affected
by the overall downtu of the industr, it seems uneasonable to reward or punish the Company for
ths factor outside its control.
The fifth diffculty, exc1uding regional Energy Star homes marketing costs ànd benefits, is
caused by the joint natue of Energy Star homes program effort shared by NEEA (of which Idao
Power is an indirec par), Idaho Power directly, and other entities. Ths would be a lesser problem
if we could simply count all ofIdao Power's costs, direct and shared, and all benefits over the life
of the homes. But parly due to NEEA's focus on market transformation and futue ~enefits, there
STAFF COMMENTS 6 JANUARY 31, 2007
Attadiment A
Case No. IPC-E-09-04
Staff Comments
05/01/09 Page_6 of 8
. .
is no good way to allocate near-ter benefits to Idaho Power. Thus, the Staf agred, for the
puroses of ths pilot, to allow exclusion ofIdaho Power's nearly $200,000 shar ofNEEA's costs
for .this progr from its potential incentive/penalty calculations. Even assuming that ths is a
reasonable solution to this problem with the pilot, it does decrease the accuacy of the resulting net
benefit calcuations. A related problem is that NEEA's Energy Star homes program is arother
facr that is mostly outside Idaho Power's direct control, but the relative success or failure of
NEEA's effort wil affect, to some degree, the success or failure ofIdaho Power's program and
the amount of the Company's incetive reward or penalty.
The sixth diffculty, calculatig the incentive or penalty using an allocation of joint costs
based only on heating and cooling degree days, is caused by the fact that more than half of the
incremental cost of Energy Sta homes is for extra insulation and better windows, which reduce
both average and peak electrcity and gas demands. Of the $2,023 averge incremental cost per
Energy Star home for better insulation and windows, Idaho Power allocated just $250 or 12% to
electrcity costs based only on heatig degree days versus cooling degree days. Whle allocations of
joint costs are always somewhat arbitr, ths allocation seems especially so because it ignores the
benefits due to peak load reductions for electrcity versus natual gas. Idaho Power calculates the
benefits of Energy Star homes based ôn tie-varing energy and load reductions. Those benefits
should not be ignored when allocating costs that are used to deterne net benefits.
The seventh diRiculty, uncertainties in average savings and base percent of Energy Star
homes achieved, are not, by themelves, huge problems, but they do add uncerainty to the range of
potential incentive payments or penalties. Idaho Power does not yet have an actual evaluation of
energy savigs for Energy Sta homes in Idaho Power's serce area. Idaho Power and NEEA's
prelimar working estimates for varous nortwest climates are presumably reasonable, but these
estimates need to be tested by actu measurements specific to Idaho Power's serce area. The
other uncertainty results from not yet having Wells Fargo housing permt data beyond Augut of
2006. Thus, the base 4.9% Energy Star homes percent mentioned by Company witness Tim Tatu
is estiated based upon interolated data frm Consction Monitor that was extrapolated as an
extension to the Wells Fargo data. As previously mentioned, by using a combination of Census and
Wells Fargo data, Staff estimates Idaho Power's Energy Star success wil be about 3.9% for 2006.
Staff agrees with Mr. Tatu that the 2006 perceOtage, which serves as the penalty base, wil need to
be recalcuated when better data becomes available and after there is agreement on the source(s) of
such data.
STAFF COMMENTS 7 JANARY 31, 2007
'Attachient A
Case No. IPC-E-09-04
Staff Comments
05/01/09 Page 7 of 8
.
CONCLUSION
Idaho Power's customers wil benefit if more homes are built to Energy Star standards, as
. opposed to minimum buildig code standads. Furermore, given that i 00% of Energy Star homes
are independently inspected, the benefit of Energy Star homes is understated to the extent that not
all non-Energy' Star homes meet minimum building code energy effciency standards. All of the
technical difficulties and uncertainties previously discussed are metrcs issues that should remain
negotiable among the Staff, Idaho Power and other paries durng the course of the pilot incentive
mechanism. None of the problems by themselves, or even all of them combined, rise to the level of
negating the benefits of cost-effectively building more energy effcient homes. Staff believes that
the proposed incentive mechansm wil likely result in more Energy Star homes being built in Idaho
Power's service area than would otherwise have been built.
RECOMMENDATION
Staff recommends that the proposed pilot incentive mechansm be approved, contingent
upon quarerly progress reports being filed by Idaho Power, and a clear understanding that the
pilot's metrics may need to be refined or otherwse modified, or the pilot eliminated, before the end
of the three year tral. Staff expects that such modifications would be presented to the Commission
for its approval before any incentives or penalties are incured.
Respectfully submitted this 5!
3/ day ofJanuar 2007.
Scott Woo bur
Deputy Attorney General
Technical Staff: Lyn Anderson
i:umisc:commentslipce06.32swla
STAFF COMMNTS 8 JANARY 31, 2007..... .~
- Att¿hment A
Case No. IPC-E-09-04
Staff Comments
05/01/09 Page 8 of 8
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 1ST DAY OF MAY 2009, SERVED
THE FOREGOING COMMENTS OF THE COMMISSION STAFF, IN CASE
NO. IPC-E-09-4, BY MAILING A COPY THEREOF, POSTAGE PREPAID, TO THE
FOLLOWING:
LISA D NORDSTROM
BARTON L KLINE
IDAHO POWER COMPANY
PO BOX 70
BOISE ID 83707-0070
E-MAIL: InordstromßYidahopower.com
bklineßYidahopower.com
TIMOTHY TATUM
JOHNRGALE
IDAHO POWER COMPANY
PO BOX 70
BOISE ID 83707-0070
E-MAIL: ttatumßYidahopower.com
rgaleßYidahopower .com
::.kCù
CERTIFICATE OF SERVICE