20110718ICL Comments.pdf

RECEI fì"~J
Benjamin J. Otto (ISB No. 8292)
710 N 6th Street
Boise,ID 83701
Ph: [phone] x 12
Fax: [phone]
bott~idaoconservtion.org
2un JUt '8 AM 8= 59
Attorney for the Idao Conservtion Le
BEFORE THE IDAHO PUBliC UTITIES COMMISSION
IN TH MATIR OF TH
APPliCATION OF IDAHO POWER
COMPANY FOR A PRUDENCY
DETERMINATION OF ENERGY
EFFICmNCY RIDER FUNDS SPENT
IN 2010
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CASE NO. IPC-E-ll-05
COMMENTS OF TH IDAHO CONSERVATION LEAGUE
The Idao Conservtion Leage (ICL) believes that Idao Powets 2010 DSM
expenditures are prudent. Idao Power's DSM 2010 Annual Repor Supplement 1: Cost
Effectiveness demonstrates that each progr achieved a costlbenefit ratio greater tha
one. The DSM Annua Report appear to satisfy the cntena contaied in the
Memorandum of Understanding for Pruency Determination of DSM Expenditurs entered
into by the PUC Staff and Idao's three investor owned utilties. Whe ICL believ that,
going forwd, Idao Power should adopt additional measures and improve its customer
engagement method, the purse of this DSM prudency revew ca is to look back
at past spendig. The Ida Power DSM 2010 Annual Report, as a whole, revals the
Company has prudently acquid 187,626 MWh of energ savigs and 336 MWof
demand reduction capacity.
Whe ICL believs Idao Powets 2010 DSM spendig was prudent we have two
specific comments:
COMMENTS OF
IDAHO CONSERVATION LEGUE
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July 15,2011
1. Idao Power us four tess to denstrate cost effecivenes and al the
pros pa the three most relevat tests. The PUC Staff, in Attachment 1 of the DSM
MOU, expects ((that al progs and individua measures should have the goal of cost
effectiveness from the total reurce, utilty, and paricipat persctive."! The DSM 2010
Report, Supplement 1, demonstrates that Idao Power ha achived thi goal. The total
reurce cost tes (TRC) ((reflecs the total benefits and costs to al cusomers (paricipants
and non-paricipats) in the (utilty) servce terntory."2 The utilty cost test (UTC)
((cacultes the costs and benefits of the prog from the persive of. . . the utilty
implementing the progr."3 The paicipant cost test (PCT) ((ass the costs and
benefits from the perspective of the cusomer instalg the measure."" A cost/benefit
ratio greater tha 1.0 under each of thes tess means the pro is prudent for the utilty
and ratepayers both those who paicipate and those who do not.
Ida Power also includes the ratepayer impact measur test (RIM), which
examines "the potential impact the energ effciency progr ha on rates overa."5 Whe
some pros do have an RIM ratio of less than one, thi is no reason to find any of
these progrs imprudent. A RIM ratio below 1.0 reveals that, al else being equa, DSM
spndig may caus utilty rates to ns. But th test does not reveal whether individua
cuomer bils wi increase. As explaied by the National Action Plan for Energ
Effciency "Te RIM may be negtive, even at the same time as average bils decrease (as
! Memorandum of Understandingfor Prudency Determintion of DSM Expenditures at 9, Order No.3 i 039.
2 National Action Plan for Energy Effciency, Understanding Cost-Effectiveness of Energy
Effciency Programs: Best Practices, Technical Methods, and Emerging Issues for Policy-Makers
at 3-7 (November 2008).3 Id, at 3-6 (NAPEE calls this test the progr adinistrtor cost test in recgnition that some dsm
progs ar ru by third paies, not just utilties.)4 Id, at 3-5.
5 Id.
COMMENTS OF
IDAHO CONSERVATION LEGUE
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July 15,2011
evauated using the (UCT)). Therefore, policy-makers have to decide whether to emphas
customer bils by using the (UCT) or customer rates by using the RIM.''6 ICL submits that
the proper policy is to focus on reducing ratepayer bils, not utilty rates since the bil is
where ratepayers feel the pa.
2. Idao Power has made great stndes in acquig energ savigs but substantial
potential remais unmet. Ths Commission recently stated: ((Idao Power should
continue to purue al cost effective DSM - even in exces of the Energ Efficiency Rider."
Order 32245 at 5. The DSM 2010 report demonstrates yet aga, that energ efficiency
and demand response are the least cost resources avaable to provide ratepaye with the
benefits of our electncity dnven society. The Company's own potential study, preformed
by Nextant in 2009, shows a substantial gap between the economic potential and the
achievble potential.7 Desite being diected to purue al cost effective DSM, and studies
revealing substantial unmet economic potential, the discusion of futur pro plans in
the DSM 2010 report doe not explai whether these chages wi close the gap.
ICL raed the issue of the unreslve gap between economic and achievle
potential in our comments on Idao Power's 2009 IRP. In response, thi Commison
stated, ((not all effciency and DSM measures ca be acquied cost effectively" due to
"economic and non-economic barers" Order No. 32042 at 19. Furher "(a)n
identification of barers would be helpful in explaiing and undersandig the Compay's
efforts and strategy to close the gap beween economic and achievble poential." Id at 19
- 20. The DSM 2010 report does demonstrate curnt pros are cos effectiv, but it
6Id. at 6-4.7 Nexant, Idaho Power Demand Side Management Potential Study at 3- 1 (residential), 4-2 (comerial). 5-
1 - 5-2 (industral), (Augut 14,2009).
COMMENTS OF
IDAHO CONSERVATION LEGUE
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July 15,2011
doe not dius potentia baers or the Compay's plan to close the gap between
achievable and economic potential. Th Commission should instruct Idao Power to
address thes barers and the strategy to over come them in each DSM annua report.
The 2011 IRP doe mention possible barers includig: "One chalenge the
Compay wi continue to face going forward is to incras its undersandig of behaviors
and decisions that residentia cuomers make in reds to energ efficiency
invesments(.)'J1 ICL acknowledges the present case is about the prudency of DSM
spndig in 2010, not necy about future progs. However, as stated above, the
DSM 2010 report demonstrates that al the curent progs ar cost effective from a
vaety of stakeholder perspectives. In fact, severa progrs have benefits far exceedig
the costs, such as the Home Improvement Progr with a PCT of 2.55, TRC of 4.85, and
UCT of 9.64.9 With results lie these, it is impruent of Idao Power to not continue thi
progr. The DSM MOU doe requie Idao Power to identify futur process chages.
MOU at 4. Accordigly, thi Commision should order Idao Power to improve its
proess in order to expand cusomer paricipation in progrs where the benefits greatly
excee the costs.
WHEREFORE, ICL respctfuly requests the Commission consider these comments.
DATED thi 15thdayofJuly2011.
Rea:intled~
Benjamin J. Otto
Idao Conservtion Leagu
8 Idaho Power 2011 IR at 40 (Jun, 20 i i )
9 Idaho Power DSM 2010 Report, Supplement 1, at 33.
COMMENTS OF
IDAHO CONSERVATION LEGUE
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July 15,2011
CERTIFICATE OF SERVICE
I hereby certif that on this 15th day of July, 2011, true and corrct copies of the
foregoing COMMENTS were delivred to the followig persons via the method of servce
noted:
U.S. Mai:
Jean Jewell
Commission Secretar (Ongial and seen copies provided)
Idao Public Utilties Commission
427 W. Washigton St.
Boise, ID 83702-5983
Jason B. Wiliams
Lisa D. Nordstrom
Idao Power Company
P.O. Box 70
Boise, ID 83707
Darene Nemnich
Greg Said
Idao Power Compay
P.O. Box 70
Boise, ID 83707
Peter J. Richardsn
Gregory M. Adas
Richardson & O'Le, PLL
515 N. 27th Street
Boise, ID 83702
Dr. Don Readig
6070 Hil Road
Boise, ID 83703
a ft~, Benjamin J. Oto
COMMENT OF
IDAHO CONSERVATION LEGUE
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July 15,2011