20150304notice_of_application_order_no_33242.pdf

Office of the Secretary
Service Date
March 4,2015
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF IDAHO POWER )
COMPANY’S APPLICATION FOR )CASE O.IPC-E-15-03
APPROVAL OF NEW TARIFF SCHEDULE )
82,A COMMERCIAL AND INDUSTRIAL )NOTICE OF APPLICATION
DEMAND-RESPONSE PROGRAM (FLEX )
PEAK PROGRAM).)NOTICE OF
)MODIFIED PROCEDURE
)
__________________________________
)ORDER NO.33242
On February 4,2015,Idaho Power Company applied to the Commission for an Order
authorizing the Company to implement a new schedule—Schedule 82,Flex Peak Program—and
continue recovering its demand response program expenses in the current manner.The
Company asks the Commission to process the case under Modified Procedure,and to issue an
Order by May 1,2015,so the Company can solicit participants and implement the program by
June 15,2015.
NOTICE OF APPLICATION
YOU ARE 1-IFREBY NOTIFIED that the Company proposes to offer a new demand
response program—the Flex Peak Program—that would enable commercial and industrial
customers to voluntarily reduce their loads on summer peak days.The Company implemented
an earlier version of the program—the FlexPeak Management Program—in 2009.Since then,
the earlier program has achieved between 8.5 and 39.3 megawatts (MW)of generation-level
reductions per year.
YOU ARE FURTHER NOTIFIED that a third party managed the earlier program.
The Company’s contract with the third party has expired,however,and the Company believes it
can save costs for all customers and increase program transparency by managing the new Flex
Peak Program itself.The Company says most of its Energy Efficiency Advisory Group’s
members cautiously support the Company managing the program.
YOU ARE FURTHER NOTIFIED that in Order No.32923 the Commission
approved a settlement agreement that set the following design parameters for the Company’s
FlexPeak Management Program:
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO.33242 1
a.Participants.Idaho Power will not actively seek to expand the capacity of
the FlexPeak [Management]Program.Participants are industrial and large
commercial customers.
b.Program Details.The FlexPeak Management Program will be available
from June 15 through August 15,Monday through Friday,from 2:00 p.m.-
8:00 p.m.,excluding holidays.Each dispatch event will last up to four
hours per participant within the available program hours.Dispatch events
will not occur more than 60 hours per season.In the event of a system
emergency,demand response capacity from the FlexPeak Management
program will be available.Idaho Power will conduct a minimum of three
dispatch events per season.There will be two hours advanced notice to
participants.
c.Incentive.A fixed and variable payment structure may be appropriate,as
long as the variable portion is low enough that it does not prevent the
program from being dispatched.If a variable and fixed incentive structure
is used,a minimum of three dispatch events will be included in the fixed
incentive.The variable incentive will be paid to participants if Idaho
Power conducts dispatch events in the FlexPeak Management program for
more than the three minimum dispatch events.
See Case No.IPC-E-13-14,Demand Response Programs Settlement Agreement,pp.7-8.The
Company says it has incorporated these parameters into its current proposal for an internally-
managed Flex Peak Program.
YOU ARE FURTHER NOTIFIED that the Company says the new Flex Peak
Program will be available to commercial and industrial customers taking service under Schedules
9,19,or a special contract.The Company will promote the program to past commercial and
industrial demand response program participants.As explained in Schedule 82,customers who
intend to participate must apply to participate in the program before each program season begins.
YOU ARE FURTHER NOTIFIED that the Company proposes a June 15 through
August 15 season for the Flex Peak Program.During the season,the Company will call at least
three dispatch events.The events will occur between 2:00 p.m.and 8:00 p.m.,Monday through
Friday,excluding holidays,and last from two to four hours per day but not more than 15 hours
per week or 60 hours per season.The Company will notify participants of an impending event
two hours before the event occurs.
YOU ARE FURTHER NOTIFIED that the proposed Flex Peak Program’s incentive
structure includes fixed and variable payments.The fixed payment would be $3.25 per kilowatt
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO.33242
(kW)per week multiplied by either:(1)the actual kW reduction received during a dispatch
event,or (2)nominated kW if there is no event.The variable payment would be $0.16 per
kilowatt-hour (kWh)reduced,effective after the first three events have been called for the
program season.The Company would send checks to participants within 30 days after the
program season ends.
YOU ARE FURTHER NOTIFIED that the Company expects its total costs for the
Flex Peak Program will range from about $1.1 million per year without variable payments,to
$1.4 million per year if the program has 35 MW of nominated reductions and is dispatched for
60 hours.The Company does not propose changing customer rates that fund the program.
Rather,it believes the current level and method of recovery will adequately fund the program for
the foreseeable future.
YOU ARE FURTHER NOTIFIED that,in furtherance of Commission Order No.
32426,the Company moved about $2 million of commercial and industrial demand response
incentive payment into base rates effective January 1,2012.The Company has since recovered
or credited deviations above or below the base amount through the annual Power Cost
Adjustment (PCA).The Company notes that demand response costs tracked through the PCA
would include only the incentives paid to participants,or the amounts paid to third-party demand
aggregator contractors.The Company would continue to recover its labor costs for
administering the program through the Energy Efficiency Rider.
YOU ARE FURTHER NOTIFIED that the Company says it currently recovers about
$2 million a year in commercial and industrial demand response costs through base rates.The
Company expects that the Flex Peak Program’s incentive payment costs would range from about
$0.9 million per year with no variable payments,to about $1.27 million if the program is
dispatched for the maximum hours allowed.
YOU ARE FURTHER NOTIFIED that the Company proposes to recover its
expenses for the Flex Peak Program under Schedule 82,in the same manner that it currently
recovers its commercial and industrial demand response program expenses.In other words,the
Company proposes to recover its costs for the Flex Peak Program incentive payments through
base rates,with deviations from the base level tracked through the PCA.The Company explains
that this will allow 100%of any annual program cost savings to flow to customers by June of the
following year.The Company would continue to recover program labor expenses and
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO.33242 3
administrative expenses through the Energy Efficiency Rider.The Company’s DSM Annual
Report would report on all program activities,including how the program impacts the Energy
Efficiency Rider and what incentives are to be included in the PCA.
YOU ARE FURTHER NOTIFIED that the Application and supporting workpapers,
testimonies and exhibits have been filed with the Commission and are available for public
inspection during regular business hours at the Commission offices.The Application and
testimonies 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 “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.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 MODIFIED PROCEDURE
YOU ARE FURTHER NOTIFIED that the Commission has determined that the
public interest may not require a formal hearing in this matter and will proceed under Modified
Procedure pursuant to Rules 201 through 204 of the Idaho Public Utilities Commission’s Rules
of Procedure,IDAPA 3 1.01.01.201 through 204.The Commission notes that 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 on this
Application must file a written comment in support or opposition with the Commission by
Wednesday,April 8,2015.The comment must contain a statement of reasons supporting the
comment.
YOU ARE FURTHER NOTIFIED that persons desiring a hearing must specifically
request a hearing in their written comments.Written comments concerning this Application
shall be mailed to the Commission and the Company at the addresses reflected below:
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO.33242 4
Commission Secretary Lisa D.Nordstrom
Idaho Public Utilities Commission Idaho Power Company
P0 Box 83720 121 West Idaho Street (82702)
Boise.Idaho 83 720-0074 P0 Box 70
Boise,ID 83707
Street Address for Express Mail:Email:lnordstrornlidahopower.com
docketsidahopower.com
472 W.Washington Street
Boise,ID 83702-59 18 Tami White
Quentin Nesbitt
Idaho Power Company
121 West Idaho Street (82702)
P0 Box 70
Boise,ID 83707
E-mail:twhite(àidahopower.com
gnesbittidahopower.com
These 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 Utility Case Comment or
Question Form”under the ‘Consumers”tab,and complete the form using the case number as it
appears on the front of this document.These comments must also be sent to the Company at the
e-mail addresses listed above.
YOU ARE FURTHER NOTIFIED that the Company shall file reply comments,if
necessary,no later than Wednesday,April 15,2015.
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
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 case be processed under Modified Procedure.
Interested persons shall file written comments no later than April 8,2015.
IT IS FURTHER ORDERED that the Company shall file reply comments,if
necessary,no later than April 15,2015.
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO.33242 5
DONE by Order of the Idaho Public Utilities Commission at Boise.Idaho this 9
day of March 2015.
PAUL KJELLANDER.PRESIDENT
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MACK A.REDFORD,COMMISSIONER
KR!TINE RAPER,CO’MMISSIONER
ATTEST:
D.Jewell()
Commission Secretary
0:IPC-E-I 5-O3kk
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO.33242 6