20131009notice_of_proposed_settlement_order_no_32906.pdf

Office of the Secretary
Service Date
October 9,2013
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE CONTINUATION )
OF IDAHO POWER COMPANY’S A/C COOL )CASE NO.IPC-E-13-14
CREDIT,IRRIGATION PEAK REWARDS,)
AND FLEXPEAK DEMAND RESPONSE )OTICE OF
PROGRAMS FOR 2014 AND BEYOND )PROPOSED SETTLEMENT
)
)NOTICE OF
)MODIFIED PROCEDURE
)
______________________________
)ORDER NO.32906
On June 4,2013,the Commission initiated this proceeding to examine the
continuation or modification of three voluntary demand response (“DR”)programs offered by
Idaho Power Company:A/C Cool Credit;Irrigation Peak Rewards;and FlexPeak Management
programs.See Order No.32823.With this Order,the Commission notifies interested persons
that a proposed settlement has been filed in this case,summarizes the settlement,and requests
that interested persons submit written comments about the settlement no later than 21 days from
the service date of this Order.
BACKGROUND
A.Prior Orders
In prior proceedings,the Commission “temporarily suspended”the A/C Cool Credit
and Irrigation Peak Rewards programs for 2013 and approved changes to the FlexPeak program.
The Commission suspended the first two DR programs and modified the third based on the
Company’s assertion that it would not experience a peak-hour generation deficit from 2013
through July 2016.See Order Nos.32776 and 32805.In summary,these two prior Orders
provided as follows.
Order No.32776—A/C Cool Credit and Irrigation Peak Rewards
In Order No.32776.the Commission approved a proposed settlement agreement
entered into by the parties including the Idaho Irrigation Pumpers Association,Inc.(the
“Irrigators”);Idaho Conservation League (“ICL’);Snake River Alliance (“SRA”);and
Commission Staff.The parties agreed to suspend the A/C Cool and Peak Rewards programs for
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
ORDER NO.32906 1
2013 based upon Idaho Power’s 2013 Integrated Resource Plan (“IRP”).More specifically,the
2013 IRP showed that the peak-hour projected loads for the summer months of 2013,2014,and
2015 did not show a peak-hour deficit until July 2016 and therefore [there was]no need [to
employ]peak-hour demand response programs”like the A/C Cool and Peak Rewards programs.
The Company relied on the same rationale for amending the Peak Rewards contract.
The settlement approved in Order No.32776 also provided that residential customers
participating in the A/C Cool Credit program be provided a “continuity”payment of $1.00 per
month for the three summer months of 2013.The settlement also provided for continuity
payments for those irrigation customers voluntarily participating in the four Peak Reward
options.In addition to continuity payments,the parties requested that the Commission schedule
an informal prehearing conference to set public workshops and develop a procedural schedule so
that the parties and other interested persons may evaluate changes to the demand response
programs for calendar year 2014 and beyond.The Order approving the temporary suspension
directed Staff to convene an informal prehearing conference for the parties to develop a schedule
for the public workshops.Order No.32776 at 8.
Order No.32805—FlexPeak
In the FlexPeak Order,the Commission approved changes to the program which will
reduce the cost of the program by about $500,000 for 2013.Order No.32805 at 3.As with the
A/C Cool and Peak Rewards programs,the Commission directed that the public workshops also
address “how to continue the FlexPeak program in the future.”Id.at 4.In accordance with the
Orders mentioned above,an informal prehearing conference was scheduled to further evaluate
the three demand response programs.The Commission also directed that those entities already
granted intervention would be parties in the new case.Order No.32776 at 8.
B.Proceedings in this Case
As noted above,the prior Orders directed the parties to convene an informal
prehearing conference to schedule public workshops.The prehearing conference occurred on
June 12.2013.A series of five public workshops then occurred between July 10 and August 27,
2013.Workshop participants discussed how the Company includes DR in its IRP,how it
calculates cost-effectiveness,the purpose of DR.and DR programs and their operational design.
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
ORDER NO.32906 2
The last workshop also included settlement discussions that culminated in the proposed
settlement.See Notice of Informal Prehearing Conference,and Notices of Public Workshops.
NOTICE OF PROPOSED SETTLEMENT
YOU ARE HEREBY NOTIFIED that on October 2.2013,Idaho Power Company
filed a Settlement Agreement and proposed tariffs,along with a Motion and testimony that ask
the Commission to approve them.The Company’s filing is about 85 pages long,and interested
persons may review it at the Commission’s offices or on the Commission’s web site.Further
instructions for viewing the filing are provided below.
YOU ARE FURTHER NOTIFIED that the parties to this case included Idaho Power,
Commission Staff the Irrigators,ICL,SRA,EnerNOC and the Industrial Customers of Idaho
Power (“ICIP”).All parties except the ICIP signed the Settlement Agreement.A non-party-—
Idaho Power customer and workshop participant Mike Seaman—---also signed.The signors
believe the proposed settlement is fair,just and reasonable and in the public interest and that the
Commission should approve it under Commission Rule of Procedure 274.See Idaho Power
Company’s Motion to Approve Settlement Agreement.
YOU ARE FURTHER NOTIFIED that,in summary,the Settlement Agreement
proposes to fully resolve this case as follows:
A.DR Guiding Concepts
The Company will implement DR programs using the following concepts:
1.Use existing demand response resources when possible;
2.Offer demand response for all customer classes;
3.Keep costs as low as possible;
4.Reevaluate the value calculation as the IRP changes;
5.Take a long-term outlook;
6.Calculate avoided cost for demand response by using the avoided capacity
cost of a 170 MW single-cycle combustion turbine multiplied by the
effective load carrying capacity,measured over 20 years,plus
corresponding deferred energy savings for 60 program hours;
7.Strive for consistency in dispatch requirements across programs;and
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
ORDER NO.32906 3
8.In addition to reducing peak loads,DR may be used for load following.
non-spinning operating reserves,improved reliability during emergencies.
and flexibility to address delays in building new supply-side resources.
By the 31(quarter of 2014,the Company will determine whether it is
feasible to use DR as operating reserves and,if it is.the Company will
work with Staff and stakeholders to develop a pilot program.
See Settlement Agreement at 3-4.
B.DR Valuation
The Company will use a minimum deferred resource of 170 MW when calculating
DR value.The annual value of DR equals the levelized annual cost of the minimum size
deferred resource,measured over 20 years,plus the corresponding deferred energy savings for
60 program hours.The Company’s DR portfolio presently is valued at $16.7 million.Id.at 4-5.
C’.Specific DR Programs
The Settlement Agreement discusses three DR Programs:(1)A/C Cool Credit;(2)
Irrigation Peak Rewards;and (3)FlexPeak Management.If a system emergency occurs,DR
capacity from each program will be available for immediate dispatch.Program specifics include:
A/C Cool Credit Program
The A/C Cool Credit Program is available from June 15 through August 15.Monday
through Friday.Participants receive a $15 bill credit for the season.Participants include
presently enrolled residential customers with an installed load-control device.The Company
will try to replace currently installed paging devices with Advanced Metering Infrastructure
(“AMI”)compatible devices by June 2014.The Company will not actively market the program,
but it will try to recruit customers who move into a home with a load-control device,or who
were enrolled in the program but then moved to a home without a load-control device.The
Company also will accept new participants upon request.
The Company need not notify participants before a dispatch event.Dispatch events
may last up to four hours,but no more than 15 hours per week or 60 hours per season.
Participants may opt out of two events per season.Id.at 5-6.
Irrigation Peak Rewards Program
The Irrigation Peak Rewards Program is available from June 15 through August 15,
Monday through Saturday from 1:00 p.m.to 9:00 p.m.Participants receive a fixed incentive of
about $16 per kW per season.If more than three dispatch events occur,participants receive a
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
ORDER NO.32906 4
variable incentive of $0.148 (or $0.198 for the 9:00 p.m.option)per kWh.With the realization
rate included,this results in a cost to the Company of about $0.22 per kWh,
Participants may select three interruption options.The Company need not notify a
participant before a dispatch event occurs if the participant selected Interruption Options I or 2,
but the Company must provide at least four hours notice to participants who select Interruption
Option 3.Dispatch events may last up to 4 hours.hut no more than 15 hours per week or 60
hours per season.Participants may opt out of up to three events at $5.00 per kW per event,and
opt out of additional events for $1.00 per kW per event.Id.at 6-7.
FlexPeak Management Program
The FlexPeak Management Program is available from June 15 through August 15,
Monday through Friday from 2:00 p.m.to 8:00 p.m.Participants may receive a fixed incentive
that will include at least three dispatch events.If more than three dispatch events occur,
participants will receive a variable incentive.The Company will notify participants at least three
hours before a dispatch event occurs.Dispatch events may last up to 4 hours,but no more than
60 hours per season.Id.at 7-8.
YOU ARE FURTHER NOTIFIED that Idaho Power’s Motion to Approve Settlement
Agreement and its attachments,including the Settlement Agreement,proposed tariffs,and
testimony in support of the settlement have been filed with the Commission and are available for
public inspection during regular business hours at the Commission offices.These documents are
also available on the Commission’s web site at www.puc.idaho.gov.Click on the File Room”
tab at the top of the page,scroll down to “Open Electric Cases,”and then click on the case
number as shown on the front of this document.
YOU ARE FURTHER NOTIFIED that all proceedings in this case will be held
pursuant to the Commission’s jurisdiction under Title 61 of the Idaho Code and specifically
Idaho Code §61-124,61-125 61-129.61-622 and 61-623.The Commission may enter any
final Order consistent with its authority under Title 61.
YOU ARE FURTHER NOTIFIED that all proceedings in this matter will be
conducted pursuant to the Commission’s Rules of Procedure,IDAPA 3 1.01.01.000 etseq.
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
ORDER NO.32906 5
NOTICE OF MODIFIED PROCEDURE
YOU ARE FURTHER NOTIFIED that the Commission has reviewed the filings in
this case and finds that the public interest may not require a formal hearing in this matter.
Accordingly,this matter will proceed under Modified Procedure pursuant to Rules 201 through
204 of the Commission’s Rules of Procedure,IDAPA 3l.01.01.201-.204.Modified Procedure
and written comments have proven to be an effective means for obtaining public input and
participation.
YOU ARE FURTHER NOTIFIED that any person desiring to state a position
concerning the Settlement Agreement or issues in this case must file a written comment in
support or opposition with the Commission no later than 21 days from the service date of this
Order.The comment must contain a statement of reasons supporting the comment.Persons
desiring a hearing must specifically request a hearing in their written comments.Written
comments concerning this filing should be mailed to the Commission,the Company,and other
parties at the addresses reflected below:
Commission Secretary Idaho Power Company:
Idaho Public Utilities Commission
P0 Box 83720 Julia Hilton
Boise,ID 83720-0074 Lisa D.Nordstrom
Idaho Power Company
Street Address for Express Mail:P0 Box 70
Boise,ID 83707-0070
472 W.Washington Street E-Mail:j hi lton(idahopower.com
Boise,ID 83702-5918 lnordstrom(iiidahopower.com
Idaho Irrigation Pumpers Association,Inc.:
Eric L.Olsen
Racine,Olson,Nye,Budge &
Bailey,Chartered
201 E.Center
P0 Box 1391
Pocatello,ID 83204-139 1
E-mail:[e-mail]
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
ORDER NO.32906 6
Idaho Conservation League:
Benjamin J.Otto
Idaho Conservation League
710 N.Sixth Street
Boise,ID 83702
E-mail:bottoidahoconservation.org
Snake River Alliance:
Ken Miller
Snake River Alliance
P0 Box 1731
Boise,ID 83701
E-mail:
Industrial Customers of Idaho Power:
Peter J.Richardson
Richardson Adams,PLLC
515 N.27th Street
P0 Box 7218
Boise,ID 83702
E-mail:peter(ric hardsonadarns corn
EnerNOC,Inc.:
Melanie Gillette
Director,Regulatory Affairs
115 Hazelmere Dr.
Folsom,CA 95630
E-mail:mgilletteenernoc.com
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 v.puc.idaho.gov.Click the “Consumers’tab,scroll
down and click on “Utility Case Comment or Question Form,”and then complete the comment
form using the case number as it appears on the front of this document.These comments must
also be sent to the Company and parties at the e-mail addresses listed above.
YOU ARE FURTHER NOTIFIED that if no written comments or protests are
received within the time limit set,the Commission will consider this matter on its merits and
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
ORDER NO.32906 7
enter its Order without a formal hearing.If written comments are received within the time limit
set,the Commission will consider them and,in its discretion,may set the same for formal
hearing.
ORDER
IT IS HEREBY ORDERED that this matter shall be processed through Modified
Procedure,IDAPA 31.01.01.201-204.Persons interested in submitting written comments about
the Settlement Agreement or issues in this case must do so no later than 21 days from the service
date of this Order.
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this
day of October 2013.
MACK A.REDFORD,COMMISSIONER
L
MARSHA H.SMITH,COMMISSIONER
ATTEST:
A ‘N/4/A’fJ /
J D.Jewell j
Commission Secretary
bls/O:IPC-E-1 3-1 4kk2
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
ORDER NO.32906 8