20090609Comments.pdf

NEIL PRICE
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
IDAHO BAR NO. 6864
RECEIVED
lOO' JON -9 AM 9: 29
IDAHO PUBLIC
UT!L1TIES COMMISSION
Street Address for Express Mail:
472 W. WASHINGTON
BOISE, IDAHO 83702-5983
Attoniey for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF IDAHO POWER
COMPANY'S APPLICATION SEEKING
AUTHORITY TO IMPLEMENT A
COMMERCIAL AIR CONDITIONER
CYCLING PILOT PROGRAM.
)
) CASE NO. IPC-E-09-12
)
) COMMENTS OF THE
) COMMISSION STAFF
)
The Staff of the Idaho Public Utilties Commission, by and through its Attorney of
Record, Neil Price, Deputy Attorney General, in response to the Notice of Application and
Notice of Modified Procedure, issued on May 12,2009, Order No. 30804, submits the following
comments.
BACKGROUND
On April 16, 2009, Idaho Power Company ("Idaho Power" or "Company") fied an
Application with the Commission, pursuant to Idaho Code §§ 61-502, 61-507, 61-508 and
Commission Rules of Procedure 52, seeking authority to implement a Commercial Air
Conditioner (AC) Cycling Pilot Program ("Program").
Idaho Power's Application describes the Program as directed toward small commercial
customers; similar to its Schedule 81 residential air conditioner cycling program; and developed
in response to numerous inquiries and requests from its small commercial customers.
STAFF COMMENTS 1 JUE 9, 2009
Paricipation in the Program will be extended to Schedule 7 and Schedule 9 secondar
customers in Ada and Canyon Counties with a base load capacity under 200 kW.
Under the terms and conditions of the Program, Idaho Power retains discretion as to
whether to select or reject Program paricipants. Paricipating commercial customers can elect to
either: (1) install a direct load control device ("Device") similar to the one used in the residential
program; or (2) install a Programmable Controllable Thermostat ("PCT") which allows the
Company to initiate AC cycling.
The PrograI wil ru for two air conditioning seasons (June, July, and August) in order
to allow the Company to obtain sufficient data and operational information to evaluate cost-
effectiveness and make a determination as to whether to offer a full-scale commercial program in
the future. The Company envisions that the Program could potentially address its "summer
peaking requirements" by reducing commercial AC use during the sumer peaking period.
Additionally, the PCT may help reduce overall energy use which could result in potential savings
to all of the Company's customers.
Idaho Power wil have the capabilty to initiate a cycling event by sending a radio/paging
signal to the PCT or Device. A power line carier ("PLC") signal will be used for customers
with installed Advanced Mete~ring Infrastrcture ("AMI"). The radio/paging signal system will
eventually be replaced by a PLC system as AMI installation is completed or the paging type
switches require service. Cycling events may last up to four hours, continuous or in various
segments, per day during the June-August AC season. Cycling events are limited to a total of 40
hours each month and 120 hours per AC season. Compensation for Program paricipation wil
consist of either a $7.00 monthly payment for Device paricipants or receipt of a PCT for PCT
paricipants.
The Company's Application includes, as Attchment No.1, a copy of a proposed new
taiff Schedule 82 which includes: (1) a detailed description of the Pilot Program, (2) terms and
conditions for Program paricipation, and (3) procedures for withdrawal from Program
paricipation.
Idaho Power requests that the costs of the Program be paid by the Energy Effciency
Rider fuds collected under Schedule 91. The Company estimates that the costs for the Pilot
Program wil be approximately $325,500 for 2009 and $340,800 for 2010.
STAFF COMMENTS 2 JUE 9, 2009
STAFF ANALYSIS
Idaho Power's Application stated that its research indicated a wide range of load
reduction capabilty has been achieved by other utilities' similar programs. The Company said it
will acquire data regarding the Program's potential to reduce peak load by installng data loggers
on a sample of pilot paricipants. The Company will also solicit and evaluate data regarding
customer preference, level of comfort and overall satisfaction with the Program. Due to the
uncertinty of achievable average load reduction in Idaho Power's service area and thus the cost-
effectiveness of a full, on-going program for Schedule 7 and Schedule 9 Secondary customers,
the Company is seeking approval to operate this program as a two-year pilot with an estimated
cost of $765,300.
In the Application, Idaho Power stated that due to Device and PCT installation costs
being higher than AC switch costs in the Residential AC Cycling Program, a commercial
Program may not be cost-effective. But, the Company also said that the Program would be cost-
effective if an average load reduction of at least 2 kW is achievable at a 50% cycling rate,
compared to the achieved average residential load reduction of 1.12 kW. However, at Idaho
Power's October 2,2008, meeting of its Energy Efficiency Advisory Group (EEAG), the
Company estimated the potential demand reduction for a small commercial AC cycling program
to range between just .88 kW and 1.54 kW per thermostat. The Application in this case provided
no data to support the Company's request to initiate a pilot for a program that will be cost-
effective only if a much higher average load reduction of 2 k W is achieved. And telephone calls
to Idaho Power representatives resulted in no supportng data being provided.
Assuming that there is at least a potential chance of this program being cost-effective,
much of the data that Idaho Power needs to evaluate such potentialiy may be obtainable less
expensively through varous surey and analyses techniques. An Idaho Power representative
said that the Company considered using such survey methods to obtain the data it needs, but
ultimately decided to proceed with a two-year pilot, instead.
Staff does not believe that it has sufficient information to judge the potential cost-
effectiveness of a full, non-pilot program. Generally Staffprefers to defer to the Company's
prerogative in planing and implementing its demand-side (DSM) programs, with Staff
evaluating the prudency of such planing and implementation at a later date. However,
STAFF COMMENTS 3 JUNE 9, 2009
the scant information provided in this Application, combined with prior information provided to
the EEAG, leaves Staff with too much skepticism of this pilot to recommend its approvaL.
RECOMMENDATIONS
Staff recommends that Idaho Power's Application for authority to implement a
Commercial Air Conditioner Cycling Pilot Program be denied. Staff fuher recommends that
the Company be invited to reapply for authority if and when it is able to support such a request
with sufficient information and analysis leading to a reasonable expectation of cost-effectiveness.
ax\
Respectfully submitted this 1y- day of June 2009.
¡J~~
Neil Price
Deputy Attorney General
Technical Staff: Lyn Anderson
i:umisc: commentslipce09. i 2npla
STAFF COMMENTS 4 JUE 9, 2009
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 9TH DAY OF JUE 2009,
SERVED THE FOREGOING COMMENTS OF THE COMMISSION STAFF, IN CASE
NO. IPC-E-09-12 BY MAILING A COPY THEREOF, POSTAGE PREPAID, TO THE
FOLLOWING:
DONOVAN E WALKER
BARTON L KLINE
IDAHO POWER COMPANY
PO BOX 70
BOISE ID 83707-0070
E-MAIL: dwalker(ßidahopower.com
bkline(iidahopower .com
DARLENE NEMNICH
GREGORY W SAID
IDAHO POWER COMPANY
PO BOX 70
BOISE ID 83707-0070
E-MAIL: dnemnich(ßidahopower.com
gsaid(ßidahopower .com
i\
CERTIFICATE OF SERVICE