20150313Nemnich Direct.pdf

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BEEORE THE TDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OE THE APPLICATION
OE IDAHO POWER COMPANY EOR A
DETERMINATION OE 2074 DEMAND-
STDE MANAGEMENT ("DSM") EXPENSES
AS PRUDENTLY INCURRED.
CASE NO. IPC-E_15-06
IDAHO POWER COMPANY
DIRECT TESTIMONY
OF
DARLENE NEMNICH
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A.
O. Please state your name and business address.
A. My name is Darlene Nemnich. My busj-ness
address is L22l West ldaho Street, Boise, Idaho 83102.
O. By whom are you employed and in what capacity?
A. f am employed by Idaho Power Company ("Idaho
Power" or "Company") as a Senior Regulatory Analyst.
P1ease describe your educational background.
In May of 1979, I received a Bachelor of Arts
degree in Business Administration with emphases in Finance
and Economics from the College of Idaho j-n Caldwell. Idaho.
In addi-tion, I have attended the electric utility
ratemaking course offered through New Mexico State
University's Center for Public Utilities, the Edison
Electric Institute's Electric Rate Advanced Courser ds well-
as various other ratemaking courses.
o.Please describe your work experience with
Idaho Power.
A. In L982, T was hired as an analyst j-n the
Resource Planning Department. My primary duties were the
calculation of avoided costs for cogeneration and sma.l-l-
power production contracts and the calculation of costs of
future generation resource options. In 1989, I moved to
the Energy Services Department where I performed economic,
financial, and statistical analyses to determine the cost-
effectiveness of demand-side manaqement ("DSM") programs.
NEMNICH, D] 1
Idaho Power Company
1 In 2000, I was promoted to Energy Efficiency Coordinator.
2 ln that capacity, I coordinated the Company's efforts to
3 grow customer programs and promote education in energy
4 efficiency. I was responsible for complyj-ng with
5 regulatory and financial requirements in the area of energy
6 efficiency. In 2003, T was promoted to Energy Efficiency
7 Leader where I managed the Company's DSM efforts, including
8 strategic planning, design and development of programs,
9 regulatory compliance, and overall management of the
10 department. In 2006, I l-eft the Company to pursue personal
11 opportunities. In 2008, I returned to the Company to my
12 current position as a Senior Regulatory Analyst in the
13 Regulatory Affairs Department. My duties as Senior
74 Regulatory Analyst include the development of alternative
15 pricing structures, analysis of the impact on customers of
16 rate design changes, and the administration of the
l1 Company's tariffs.
18 O. What is the purpose of your testimony in this
19 case?
20 A. The purpose of my testimony is to present the
2L Company's request for a determination that $33,495,385 of
22 DSM expenses incurred in 2014 for the acquisition of
23 demand-side resources were prudently incurred. This amount
24 includes $25,554,688 funded by the Idaho Energy Efficiency
25 Rider ("Rider") and $7,940,697 of demand response program
NEMNICH, DI 2
Idaho Power Company
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incentive payments that wiII be incl-uded in the April 15,
20!5, Power Cost Adjustment ("PCA") filinq. The 201,4 DSM
expenses for which Idaho Power is seeking a prudence
determination is an increase of 29 percent over the 20L3
DSM expenses in l-ast year's prudence case (IPC-E-14-04).
This j-ncrease in expenses is accompanied by a 33 percent
increase in energy savings over 2073 energy savings when
consideri-ng fdaho Power's effj-ciency programs alone. When
the Northwest Energy Efficiency Alliance ("NEEA") savings
are included, the energy savj-ngs increase of 20L4 over 20L3
is 27 percent.
My testimony will (1) provide a review of 20L4 DSM
performance, (2) di-scuss 201,4 DSM expenses and adjustments,
(3) provide an overview of cost-effectiveness, (4) review
eval-uation efforts, and (5) describe stakeholder input and
the actions Idaho Power has taken to comply with the Errata
to Order No. 33161 received in last year's DSM expenses
prudence request. Einally, my testimony will summarize how
this filing satisfies the Memorandum of Understanding for
Prudency Determination of DSM Expenditures fil-ed j-n Case
No. IPC-E-09-09 (*DSM MOU").
I. 2014 DSM PROGRAD{ PERFORITA}ICE
O. Please provide an overview of ldaho Power's
DSM efforts in 2074.
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Idaho Power Company
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A.Tn 2014, Idaho Power achj-eved 27 percent more
energy savings than in 2013, restructured and implemented
its demand response programs at significantly reduced costs
to customers, and successfully executed an agreement to
continue its participation in NEEA, al-so at l-ower costs to
customers. Idaho Power's energy efficiency portfolio was
cost-effective resulting in a 1.89 benefit/cost ratio when
evaluated at a Total Resource Cost ("TRC") test perspective
and a 3.49 benefit/cost ratio when evaluated at a Utility
Cost ("UC") test perspective
Tn 20L4, on a system-wide basis, Idaho Power offered
customers 18 energy efficiency programs or pilots and three
demand response programs, participated in market
transformation efforts through NEEA, and offered several-
ongoing educational initiatives and other activities. A
summary of Idaho Power's 20L4 DSM activities is provided in
Table 1 below.
NEMNICH, DI 4
Idaho Power Company
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Tab1e 1. 2OL4 DSM progr,ns
location, and ener(fy
by sector, operational. type,
savings/demand reduction
Progran by Sector Oparational. ryr1>e
Savings/Den.nd
State Reduetion
Residentia].
A/C CooI Credi-t
Ductl-ess Heat Pump PiLot
Energy Efficient Lighting
Energy House Cal1s
ENERGY STAR@ Homes Northwest. . . . .
Heating & Cooling Efficiency Program ...
Home Energy Audit
Home lmprovement Program
Home Products Program .. ..
Local Energy Effi-ciency Eunds
Oregon Residential Weatherization
Rebate Advantage
Residential Energy Efficiency
Education fnitiative
See ya Iater, refrigeratort'...
Shade Tree Project ..
Weatherization Assistance for
Qualified Customers
Weatherizatj-on Solutions for Eligible
Arcfamare
Comercia]-/Industrial
Buildlng Efficiency
Commercial- Education Initiative
Custom Efficiency
Easy Upgrades ..
ElexPeak Management
Oregon Commercial- Audits
Irrigration
Irrigation Efficiency Rewards
Irrigation Peak Rewards . ..
A11 Sectors
Northwest Energy Efficiency Alliance ...
Demand Response
Energy Efficiency
Energy Efficiency
Energy Efficiency
Energy Efficiency
Energy Efficiency
Energy Efficiency
Energy Efficiency
Energy Efficiency
Other Programs andActivities
Energy Efficiency
Energy Efficiency
Other Programs andActivities
Energy Efficiency
Other Programs and
Activities
Energy Efficiency
Energy Efficiency
Enerqy Efficiency
Other Programs and
Activities
Energy Efficlency
Energy Efficiency
Demand Response
Energy Efflclency
Energy Efficiency
Demand Response
Market
Trans format ion
44 MW
463 MWh
12,882 MWh
57 9 Mhth
528 MWh
1,099 MWh
141 MWh
839 MIdh
652 Mhrh
9 6 M!'lh
11 Mbrh
270 MWh
1, 4 91 Mlith
1,391 MWh
n/a
534 Mhrh
291 MWh
9,458 MV\lh
n/a
50,363 MWh
19,118 MWh
40 MW
n/a
IDlOR
IDlOR
IDlOR
IDlOR
]D/OR
IDlOR
ID
1D
IDlOR
IDlOR
OR
IDlOR
IDlOR
IDlOR
1D
ID,/OR
1D
IDlOR
1DlOR
IDlOR
]D/OR
I D,/OR
OR
rDloR 18,464 MWh
IDIOR 295 MW
rDloR 20,000 MWh
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4 Table 1 j-l-l-ustrates the broad availability of
programs offered by Idaho Power to its customers in energy
effi-ciency, demand response, and education. The Demand-
NEMNICH, DT 5
Idaho Power Company
1 Srde Management 2014 Annual Report ('DSM 20L4 Annual
2 Repott"), Attachment 1 to the Application filed in this
3 proceeding, provides details for each program, including a
4 descriptlon of each program, 2014 performance and
5 activities, cost-effectiveness, customer satisfaction, and
6 eval-uation results. fn addition, the DSM 2014 Annual
7 Report provides fdaho Power's DSM strategj-es for 20L5.
8 Q. What l-evel of j-ncremental annual energy
9 efficiency savings was achieved in 20L4 with energy
10 efficiency programs?
11 A. On a system-wide basis, Idaho Power achieved
L2 138,6'7 0 megawatt-hours ('MWh") of incremental annual- energy
13 efficiency savings in 2014. Thj-s value includes 118,670
74 MI/'Ih f rom Idaho Power's energy ef f iciency programs and an
15 estj-mated 20,000 MWh of energy efficiency market
1,6 transformation savings through NEEA initiatives. The
11 j-ncrease in the 20L4 savi-ngs was driven primarily by
18 industrial sector program savings and to a lesser degree
L9 from the residential sector. Table 2 below shows the
20 incremental annual energy efficiency savings in MWh from
2L 2002 to the current year. Also shown on thj-s tabl-e are the
22 total energy efficiency expenses for each year in millj-ons
23 of dollars.
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Tab1e 2 Annual energy
efficiency expenses
savings (lfilh) and energy
($ni1].ions) 2OO2-20L4
250.000 (NEEA)(MWh)
:ldaho Power Program Saving6 (MWh)
2@2 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Note: 2014 NEEA market-transfomation savinEJs are estiuated.
O. What level of demand reduction capacity was
available from Idaho Power's demand response programs in
20L4 after the temporary suspensi-on of two of the Company's
three demand response programs in 201,3?
A. Idaho Power's three demand response programs
operated in 201,4 to provide a peak demand reduction of 378
megawatts ("MW"). This value represents the realized, non-
coincident load reduction from al-1 three programs. The
total enrolled capacity from all three programs was 390 MW.
Tabl-e 3 bel-ow shows the annual peak demand reduction
capacity in MW since 2004 and the associated annual
expenses j-n millions of dol1ars. This table shows that in
2013 the Irrigation Peak Rewards program and the A/C Cool
Credit program were suspended. As a result of the
settlement achieved with stakeholders through demand
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$30
$25 aEc$20 3oooc$15 &xUI
uJut
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$5
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3 rso,ooo
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EU'> 100,000PoEul
50,000
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response workshops in 2013, the Company successfully
restructured these programs in 2074 at a l-ower cost per MW
of demand reducti-on capacity than in prior years.
TabJ.e 3 Peak demand deduction capacity (!fiY) and denand
response e:q)enses ($ niJ.J.ions) 2OO4-2OL4
oE
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=oo!
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Eoo
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3C'6ltooc
.9o
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tE
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J6or
500
450
400
350
300
250
200
150
100
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0 mu
a.
efficiency
("rRP") ?
rPeakdemand
reduction capacity
-Demancl
response
o(penses
$15.00
In 20L4, did Idaho Power meet the energy
targets included in the fntegrated Resource PIan
20122011
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A.Yes. Table 4 below shows the annuaf
incremental energy efficiency savings compared with the fRP
targets for 2002 through 20L4 shown in average megawatt
hours ("aMW") . The Company's savings each year surpassed
its annual IRP target L2 out of the last 13 years.
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Idaho Power Company
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Table 4. Annual increnental. energy efficiency saving,s (al{t{)
with IRP targets (2OO2-2OL4}
:lPC Savings (with NEEA)
==gSng,
oFtEo15og,tr5G
E10
EE
savi-ngs
through
Tab].e
2W2 2003 20c4 2005 2006 2007 2008 2009 2010 2011 n12 2013 2014
Tabl-e 5 below shows the cumul-ative energy efficiency
j-n aMW compared with the IRP targets for years 2002
201-4.
5. Annual. cumuJ.ative energy efficiency saving's (a!{W)
with IRP targets (20O2-2OL4)
i rlPCSavings (with NEEA)
L
-lRPTargets
+---*"i
180
160I
=g 140oot',F 120
ttro 100o
B'E 80oo
E603
E6q
20
0
2010 2011 2012
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2013 2014
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II.2OL4 DSM EXPENSES A}ID ADiIUSTI{ENTS
o.Vflhat is Idaho Power's focus when spending
Rider funds for the purchase of DSM resources?
A.Idaho Power takes its responsibility of
prudently managing customer funds seriously. The Company's
actions Ln 2074, and the content of the DSM 2014 Annual-
Report, provide evidence supporting the conscientious work
Idaho Power employees and leaders have made toward using
customers' funds wj-seIy. The Company believes it is
important to get the maximum value for its customers.
o.What amount of 2014 DSM expenses is the
Company requesting the Idaho Public Utilities Commission
("Commission") find prudently incurred?
A.In the delivery of energy efficiency, demand
response, and market transformation programs, ds well- as
education and administrative costs, Idaho Power expended
$25,554,688 of Rider funds and $7,940,697 of demand
response program incentives for a total of $33r 495r 385
spent on demand-side resource acquisition tn 20L4. To
arrive at an amount for prudence determination, these
numbers do not include certain Rider-funded labor expenses
from 201,4 and prior years as described later in my
testj-mony. Idaho Power requests that the 20L4 Rj-der-funded
DSM expenses and the 2014 demand response program
incentives recovered through base rates and the PCA be
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Idaho Power Company
1 reviewed together for a prudence determination. With this
2 frl:-ng, Idaho Power requests the Commission issue an order
3 finding that these funds were prudently incurred. Exhibit
4 No. 1 to my testimony, 2074 ldaho DSM Expenses and
5 Adjustments for Prudence FiTing, shows a breakout of these
6 expenses by program and customer sector and by funding
7 source.
O. Pl-ease compare the dollar amounts in Exhibit
9 No. 1 with Appendix 2 of the DSM 201-4 Annual Report.
10 A. For clari-ty and ease of understandi-ng, Exhibit
11 No. 1 ties to Appendix 2. 2014 DSM expenses by funding
1,2 source (dol-lars) , which is found on page l-68 of the DSM
13 2014 Annual Report. The first column of Appendix 2 labeled
14 "Idaho Rider" and the first column of Exhibit No. 1 labeled
15 "Rider Expenses" match at the row labeled "Total- Expenses"
1,6 in the amount of $25,556,089. A11 values in Exhibit No. 1
77 represent DSM expenses for the ldaho service area on1y.
18 Adjustments to these totals are needed to accurately arrive
79 at the total 201-4 expenses for purposes of the prudence
20 determination. There are two categories of adjustments:
2l prior year-end accounting adjustments, and current year-end
22 accounting adjustments. To aid in explalning the
23 adjustments, in my Exhibit No. 1, I have added a section at
24 the bottom of the table titl-ed *Adjustments."
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NEMNICH, DI 11
Idaho Power Company
1 Additionally, the column at the far right of Exhibit
2 No. 1 labeled "Idaho Rider Labor Transferred to O&M" is
3 included for informational purposes on1y. The amounts have
4 already been removed from the Rider and Idaho Power is not
5 asking for a prudence determination of these amounts.
6 Q. In this filing, did Idaho Power j-ncl-ude the
7 increases in 20L1-20L4 Rider-funded l-abor expense for a
8 prudence determination?
9 A. No. In Order Nos. 32661, 32690, and 32953,
10 the Commi-ssion declined to decide the prudence of the
11 increases in 207L and 2072 Rider-funded l-abor expense,
12 while at the same time offering the Company another
13 opportunity to provide sufficient evidence at a future
74 time, preferably revisj-ting this j-ssue in the next general
15 rate case. Order No. 32953 at 8. Because of the
76 Commission's decisions in these three orders, fdaho Power
77 is not asking for a prudence determination in this filing
18 for the increase in Rider-funded l-abor expenses that
19 occurred from 2071 through 20L4.
20 O. Pl-ease quantify the j-ncrease in 20L4 Rider-
27 funded labor expense based upon 2010 labor rates that has
22 been excluded from the Company's request for determination
23 of prudence.
24 A. The increase in Rider-funded l-abor expense
25 based upon 20L0 labor rates included in 2074 DSM expenses,
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but excluded from the Company's request for determination
of prudence, is $338,707.
o.Please explain the methodology used by Idaho
Power to arrive at this amount.
A.Please refer to Table 6 below where the
increase j-n 2014 Rider-funded l-abor expense based upon 2070
labor rates has been quantified. Idaho Power j-s using the
same methodology to quantify the increase in 2014 Rider-
funded labor expense that was previously adopted by the
Commission for use in 2011 through 2013. The calcul-ation
is based upon the last Commission-approved l-abor amount per
full--time equivalent employees ("FTE"). Eor the year 2010,
total l-abor costs of $2,511 ,080 were divided by the total
FTE of 26.70 for an average labor cost per ETE of $96,520.
This i-s shown in the first row of Table 6 labeled 2010.
Table 6
Column 1
Total
Labor
$2,57 7,080
$2,637 ,729
$2,886,988
$2,7 61 ,445
$2 ,7 20 , 954
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2010 $/ErE
$96,520
$96,520
$96,520
$ 96, 520
$96,520
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Col-umn 2
times
2010 $/FrE
$2 , 548 ,1,28
$2,1!3,117
$2, 498, 013
$2,382,247
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Column 1
Minus
Column 4
$89,601
$173,811
$269,432
s338.707
$871,551
2010
2OLL
20L2
2013
20L4
Total
FTE
26.10
26.40
28.11
25.88
24.68
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The
in column 1
funded FTE
total annual Rlder-funded labor expense
and an estimate of the total number of
is shown in column 2 for each year from
NEMNICH, DI
Idaho Power
is shown
Rider-
2010 to
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2014. These estlmated FTE val-ues are based on total hours
charged to the Rider, divided by an FTE equivalent of 7,9L2
hours per year. Annual- ETE numbers vary due to a number of
reasons, including unfilled positions or number of hours
charged to the Rider by employees. Column 3 shows the 2010
labor expense per FTE used as the base to which subsequent
years are compared. This average labor expense per FTE of
$96,520 is used as the basis for this analysis because it
was the average labor expense per FTE from 2010 when all
Rider-funded labor costs were last deemed prudent by the
Commission. Column 4 shows the 207L through 2074 "deemed
prudent" total- labor expense calculated by multiplying the
yearly ETE val-ues in column 2 by the 2010 average labor
expense per ETE value of $96,520. In column 5, the actual
total labor expenses 1n column 1 is compared to the "deemed
prudent" total- labor expense in col-umn 4, resulting in the
annual- amount of rider-funded labor expense above 2010
funding levels.
a.Tn 2074, how did Idaho Power account for the
increase in Rider-funded labor expenses?
A.On a quarterly basis, Idaho Power records an
entry to move the estimated increase in Rider-funded labor
from the Rider to operations and maintenance (*O&M"). At
the end of the year, this amount is trued-up to the actual
amount and an entry is made to the l-abor task of each
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A.
program work order that had labor charged to the Idaho
Rider rn 2074, with a corresponding debitr or charge, to an
O&M task for each of the affected program work orders.
These accounting entries credited these amounts to the
Rider and charged them to O&M. In Exhibit No. 7, under the
column on the far right labeled Idaho Rider Labor
Transferred to O&M, the labor amounts are shown for each
program. These amounts represent the 2074 Rider-funded
labor expense above 2070 funding l-evel-s, which totals
$338,10'7. These labor costs, al-though funded by O&M rather
than the Rider, are included in total program costs for the
purpose of determining cost-effectiveness of the programs.
o.What j-s the cumulative amount of Rider-funded,
labor expense increases that the Company has not received a
prudence determination on since 2070?
A.The cumulative amount of Rider-funded labor
expense increases that the Commission has not issued a
prudence determination on since 2010 is $871,551.
What is the significance of this amount?
The Company is not abl-e to recover these
amounts through the Rider, but rather is required to write-
off these amounts to O&M expense which negatively impacts
earnings.
O. Pl-ease descrj-be the first category of
adjustments - prior year-end accounting adjustments.
NEMNICH, DI 15
fdaho Power Company
A. In l-ast year's prudence filing, Case No. IPC-
2 E-74-04, Idaho Power proposed a smal-l- adjustment of $248
3 that increased the amount of 20L3 expenses requested for
4 prudence determination. This was due to a labor charge in
5 the Home Energy Audit program that was initially charged to
6 the Oregon Rider in 2013 and should have been charged to
7 the Idaho Rider. In Order No. 33161, the Commission
8 approved that adjustment. This expense occurred in 2013
9 but was added to the Rider account vj-a an accounting entry
10 made 1n 20L4. In order to arrive at the actual total
l-1 program expenses for 20L4, this amount is removed from this
L2 year's prudence request to avoid a double counting of this
13 amount. This is shown in the Adjustment section of Exhibit
14 No. 1 under "Prior Year-end Accounting Adjustment, Home
15 Energy Audit Program Correctj-on."
76 O. Please explain the second and last category of
77 adjustments - current year-end accounting adjustment.
18 A. In 2014, two incentive payments in the Energy
19 House Call-s program were charged to the Idaho Rider when
20 they should have been charged to the Oregon Rider. This
27 adjustment removes $1,153 from the total amount of the
22 prudence determination request. This is shown in the
23 Adjustment section of Exhibit No. 1 under "Current Year-end
24 Accounting Adjustment, Energy House Cal-1s Program
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Correction." An accounting entry has been made in 2015 for
this correction.
o.Please summarize the impact of the two
adjustments described above to the Idaho Rj-der.
A. As shown in Exhibit No. 1-, these adjustments
reduce the total Rj-der-funded expenses to $25,554,688. The
demand response program incentive payment amount had no
adjustment and remains at $1,940,697. The post-adjustment
total of these two amounts j-s $33r495r385.
o.Did fdaho Power transfer Rider funds to
customers through a credit r ox reduction, in the 2074/2075
PCA?
A.Yes. On April 15, 2074, Idaho Power filed the
annual- PCA in Case No. IPC-E-14-05. As part of this case
the Company proposed that the Commission approve a one-time
transfer of $20 million of surpJ-us Rider funds to customers
through a credit, ot reducti-on, in the PCA. In Order No.
33049, the Commission approved the one-time transfer. This
transfer had no impact on energy efficiency activities in
2014.
O. What was the year-end 20L4 balance of the
Rider?
A. The Rider account balance at December 31, 20L4
was a negative $182,231. Table 7 below shows the January
2074 beginning balance, the funding and interest items,
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Idaho Power Company
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expenses and transfers and the ending bal-ance as of
December 31, 20L4. Al-so shown at the bottom of this table
is the accounting adjustment made in 2015, described above,
and shown on Exhibit No. 1, that returned $1,153 to the
Rider, resulting in an adjusted Rider balance of negative
$781,0't8.
Table 7
IIf . 2OL4 COST-EEFECTMIIESS O\IERVIETTI
0. What is Idaho Power's overall goal when it
comes to DSM cost-effectiveness tests?
A.Idaho Power's goal is to have all programs
achj-eve benefit/cost ratios of 1.0 or greater for the TRC
and the UC tests, and the participant cost test ("PCT") at
the program and measure level where appropriate. Because
of the value in comparing demand-side resources to supply-
side resources, Idaho Power has placed emphasis on the TRC
and UC tests. Idaho Power reviews the cost-effectiveness
NEMNICH, DI 18
Idaho Power Company
Idaho Energry Efficiency Rider (ilanuary -Decernl^er 2OL4l
Idaho Energy Efficiency Rider
201,4 Beginning Balance
2074 Eunding plus Accrued Interest
Tota]. 2OL4 Elrnds
20L4 Expenses
Transfer to PCA (IPUC Order No. 33049)
Ba].ance as of Dece'nl.er 31, 2OL4
2075 Accounting Adjustment
Adjusted Bal.anc'e a,E of Deceaber 37, 2074
$ 6,685 ,7 45
38, 088, 113
44,773,858
(25,556,089)
(20,000,000)
$ (782,23L)
7,753
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results for each program and measure on an annual basis to
determine whether the program shoul-d continue or be
modified in some way to ensure its ongoing cost-
effectiveness. If a particular measure or program is
pursued even though it will- not be cost-effective from each
of the three tests, Idaho Power works with the Energy
Efficiency Advisory Group (*EEAG") to get input. If the
measure or program is indeed offered, the Company explains
why the measure or program was implemented or continued.
The Company bel-ieves this aligns with the expectations
delineated in the DSM MOU. The cost-effective test
methodologles and assumptions are described in more detail
in the first pages of Supplement 7: Cost-Effectiveness
("Supplement 1") that is contained in Attachment No. 1 to
the Application in thj-s proceeding.
a.What were the results of the 20L4 cost-
effective analyses?
A.Exhibit No. 2 Lo my testimony, 201-4 Cost-
Effectiveness Summary by Program/ Sector and Portfolio,
shows the resul-ts of the TRC, UC, and PCT for every energy
efficiency program, by sector and for the portfolio. Erom
a sector and portfolio basis, the results are very positi-ve
with aII tests achieving benefit/cost ratios over 1.0 as
shown in Table 8 below. These results are also included in
Exhibit No. 2.
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On a program basis these resul-ts show that, using
20L4 DSM costs and benefits, of the 16 energy efficiency
programs offered in Idaho for which the Company calcul-ates
cost-effectiveness, 11 programs had benefit/cost ratios
greater than 1.0 for both the TRC and UC tests. Three
programs had benefit/cost ratios less than 1.0 for both the
TRC and UC. Two programs had benefit/cost ratios less than
1.0 for the TRC but greater than 1.0 for the UC. AII
programs for which the PCT is applied passed the PCT. PCT
ratios are not calculated for those programs that do not
have a direct customer cost, these are shown as N/A on
Exhibit No. 2. The detail-s of these calculations are in
Supplement 1 of the DSM 2014 Annual Report.
Benefit/cost ratios are currently not calculated for
the three demand response programs. The methodol-ogy used
to determine the cost-effectiveness of the demand response
programs was updated in 201,4. As part of the public
workshops in conjunction with Case No. IPC-E-13-14, Idaho
Power and other stakeholders agreed on a new methodology
NEMNTCH, Dr 20
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2OL4 Benefit/Cost Tab].e
Sector Total- Resource
Cost (TRC)
Utility Cost
(UC)
Participant
Cost (PCT)
Residentlal 1. s1 1.88 2.68
Commercial
Industrial
2.42 4.58 2.24
Irrigation 1.83 5 .67 1_. 63
Portfolio 1-.89 3.49 2 .09
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for valuing demand-response. The settl-ement agreement, as
approved in Commission Order No. 32923, defined the annual-
cost of operating Idaho Power's demand-response portfolio
must be no greater than $16.7 mil-l-ion. This $16.7 million
value is the levelized annual cost of a 170 MW deferred
resource over a 2O-year life. In 20L4, the cost of
operating the three demand response programs was $10.6
million. It is estimated that if the three programs were
dispatched for the full 60 hours a11owed, the total- costs
would have been approximately $13.8 million and the
programs would have remained cost-effectj-ve.
O. P1ease explain the impact of the 2073
Integrated Resource plan on DSM cost-effectiveness results.
A. The 2073 IRP planning process resulted in a
significant drop j-n the DSM alternatj-ve costs used to value
energy efficiency compared with previous TRPs. While
impacts will vary from program to program dependj-ng on
measure life and the end uses, decreases of program
benefits of up to 40-50 percent resulted. Multiple factors
Ied to the reduction of the DSM alternative costs, but two
of the primary i-mpacts included a reduced carbon adder used
in the 201-3 IRP process and decreases j-n early-year natural
gas price forecasts. WhiIe these benefit reductions have
placed more burden on program cost-effectiveness, some of
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the impact has been mitigated by the recent addition of
quantified non-energy benefits in the region.
O. Which programs did not have a benefit/cost
ratj-o greater than 1.0 in 20L4 for both the TRC and the UC
perspectives?
A. As shown in ExhibJ-t No. 2, three programs did
not achieve the 1.0 benefit/cost ratio threshol-d in 20L4
under the TRC and UC tests; the See ya later, refrigerator@
program, which is an appliance recycling program, and the
Weatherization Assistance for Qualified Customers (*WAQC")
program, and Weatherization Solutions for Eligibl-e
Customers ("Solutj-ons") programs, both of whj-ch are offered
to limited-income customers. The PCT is not cal-cul-ated for
these programs because the programs impose no direct costs
on the participants.
o.What caused the See ya later, refrigerator@
program to be not cost-effective in 2014?
A.The lower cost-effecti-veness in 2014 is
largely due to the l-ower DSM alternative costs from the
20L3 IRP. In 2014, the Regional Technical Forum (*RTE")
updated energy savings assumptions for these measures and
incl-uded estj-mates for non-energy benefits (*NEB") . The
updated energy savings and NEB assumptions wil-l be applied
i-n 201,5.
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1 Q. What has Idaho Power done to address the fact
2 that the See ya J-ater, refrigerator@ program became non-
3 cost-effective tn 201-4?
A. In mid-2014 Idaho Power began evaluating how
5 the program might be redesigned to improve its cost-
6 effectiveness. Program staff talked to other utll-ities and
7 program vendors and participated in regional forums to
8 identify lower-cost program design and incentj-ve options
9 for the program. On August 19, 20L4, Idaho Power presented
10 different program design options to the EEAG in order to
11 gather guidance on how to move forward. The EEAG suported
1,2 the option of removing the incentive while at the same time
13 continuing to offer the program to customers.
L4 0. What changes have been made to the See ya
15 later, refrigerator@ program to improve its cost-
16 effectiveness?
17 A. As of February 7, 20L5, the program wil-l
18 continue to provide free pickup and removal of residential-
79 refrigerators and freezers; however, Idaho Power will no
20 longer offer a customer incentive in this program. Program
27 costs were also reduced due to l-ower administration and
22 advertj-sing costs. Under this new design option, the
23 program is forecast to be cost-effective. By working with
24 stakeholders, fdaho Power has been able to continue to
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offer this program while at the same time make changes to
program components to improve cost-effectiveness.
O. For the two other programs that were not cost-
effectj-ve tn 2014, WAQC and Sol-utions, please explain why
those programs were not cost-effective.
A.The WAQC and Solution programs provide real
and substantial per home savings, but due to the costs of
comprehensive whol-e-house weatherizatj-on coupled with lower
DSM alternate costs from the 2073 IRP, the programs remain
not cost-effective from both the TRC or the UC perspective.
The non-cost-effectiveness of the WAQC and Solutions
programs stem primarily from a billing analysis conducted
f or an impact eval-uation that was completed in early 201,3.
While Idaho Power is taking steps to improve the cost-
effectj-veness for these programs, the TRC and UC resul-ts
are stil-I under the benefit/cost thresholds.
O. What activities has Idaho Power undertaken in
Iast year to improve the cost-effectiveness of the WAQC
Solutions programs?
A. fdaho Power contracted with an outside
prograrnmer to complete a new home audit tool for use in the
program. Throughout 20L4, Idaho Power staff worked with
the programmer to incorporate the evaluation
recommendations i-nto an audit tool for use in 2075. In
January 2015, the new tool, WxSoI Home Audit Tool (HAT
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t4.t) , was distributed to the four program contractors for
use in 2075.
Updates in the audit tool- include more specific
housing types, the most current measure life of individual
measures, and an updated chart of heating degree days. LED
lighting was added to the CFL measure to incorporate new
bulbs and associated savings. A heal-th and safety menu was
included to better capture non-energy saving upgrades
necessary to the weatherj-zation process and to further
research and quantify NEBs of the program. A percentage
Iimit was programmed for contractor support costs on each
measure, and a 1O-percent funding participation mandate was
added for landlords when a home is not owner occupj-ed. The
refrigerator replacement measure was updated to reflect
more accurate savings.
Tn 201,4, Idaho Power contracted with the Unj-versity
of fdaho Integrated Design Lab (*IDL") to develop a
Weatherization HVAC Replacement Savings Calculator that 1s
interactive with each measure upgraded j-n a home that
receives a new HVAC system. This tool- is expected to be
completed in early 2015, and Idaho Power will use it to
compare savings reported by the new HAT L4.l in
anticipation of improving the accuracy of savJ-ngs being
reported by the program.
NEMNICH, DI 25
Idaho Power Company
1 Idaho Power presented the 20L3 process eval-uation
2 for these programs and resulting recoflrmendations to EEAG
3 during the February 2074 meeting. The presentation
4 concluded that overall-, both of these programs are being
5 managed very welI, but there is room for improvement on how
6 savings are estimated and captured.
1 Q. How is Idaho Power addressing the fact that
8 the InIAQC and Sol-utions programs have not been cost-
9 effective?
10 A. Idaho Power continues to work diligently in
11 partnership with its program partners, stakeholders, and
!2 vendors with these programs to streamline operations,
13 adjust offerings, and develop more accurate tools to make
14 these programs more cost-effective. Because these programs
15 are designed for Iimited-lncome customers, Idaho Power
16 believes there are other benefi-ts to these programs that
L7 are difficul-t to quantify. Unless the Commission directs
1-8 otherwise, Idaho Power will continue its efforts to j-mprove
19 these programs while at the same time offering them to the
20 Company's customers on an ongoing basj-s.
2L O. Which programs did not have a benefit/cost
22 ratio greater than 1.0 in 20L4 from the perspective of the
23 TRC?
24 A. As shown in Exhibit No. 2, both the Ductless
25 Heat Pump Pilot ("DHP") Pilot program and the ENERGY STAR@
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Homes Northwest program had a benefit/cost ratio below 1.0
from the TRC perspective in 201,4. However, both programs
have a benefit/cost ratio above 1.0 from the UC
perspective.
O.Why did the DHP pilot program not meet the TRC
test threshold of 1.0?
A. In l-ate 2073, the RTF approved ductless heat
pump annual energy savings assumptions for installations
not using supplemental fuel use such as wood stoves. These
savj-ngs estimates declined from the previous estimate of
31 500 kilowatts ("kwh") to a range between 292 and 3,131
annual kwh. This range reflects the different heating and
cooling zones in the service area. As a resul-t of the
lower kwh savings, the program did not pass the TRC test.
In 2014, Idaho Power inc1uded non-energy benefits approved
by the RTE, accounting for annual- avoj-ded supplemental fuel
costs, and avoided capital expenses of air conditioning
unit purchases that would have occurred in the absence of
the installation of a DHP system. Other NEBs are currently
being eval-uated by the RTF and may be included in the
future.
a. Why did the ENERGY STAR@ Homes Northwest
program not meet the TRC test threshold of 1.0?
A. In 2074, Idaho Power certified 243 homes in
the ENERGY STAR@ Homes Northwest program. Onty eight of
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these homes were stand al-one, single-family homes, and 235
were townhomes or multi-family homes. Due to the l-ower kwh
savJ-ngs for multi-family homes versus single-family homes
the program was shown to be not cost-effective from a TRC
perspective for 20L4. Energy savi-ngs for both the single
family homes and multi-family homes are different for each
of the different weather zones in the Idaho Power service
area. Another contrlbuting factor to the program not
achieving cost-effectiveness from the TRC perspective is
that many of the mul-ti-family homes are located in the
weather zones with lower energy savings.
The RTF wil-l- be reviewing the savings estimates for
townhomes and other multi-family homes in 2075. In
addition, NEEA is evaluating new approaches to this
regional program. Idaho Power will monitor the potential-
changes to the program for possible implementation i-n the
future.
This program also provides savings in the Idaho
Power service area through the regional program. Houses
heated by natural gas and built in Idaho Power's service
area to the ENERGY STAR@ specifications produce electric
savings from measures such as lighting and air
conditj-oning. The el-ectric savings from the gas heated
homes are shown in Appendix 3 of the DSM 2014 Annual Report
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and claimed in the total- Idaho Power portfolio but not by
this program.
O. Concerning all of its programs, did Idaho
Power look at program cost-effectiveness from the Ratepayer
Impact Measure ("RIM") perspective as requested by the
Staff 1n Attachment No. 1 of the DSM MOU?
A.Yes. The RIM test measures the impact on
customers' bills or rates due to changes in utility
revenues and operating costs caused by an energy efficiency
program. According to the National Action PIan for Energy
Efficiency's Understanding Cost-Effectjveness of Energy
Etticiency Programs.' Best Practices, TechnicaT Methods,
and Emerging fssues for Pol-icy-Makers, this test is
typically a secondary test used to eval-uate relative
impacts on rates. It should be noted that while Staff, in
Attachment No. 1 to the DSM MOU, stated an expectation that
programs should pass the TRC, UC, and PCT (and if not to
provide an explanation), there was no stated expectation
that programs must pass the RIM test.
o.What were the results when Idaho Power
calculated the RIM tests on its programs?
A. When Idaho Power made these calculations,
programs had a range of benefit/cost ratios for the RIM
test with the lowest at 0.31 and the highest at 1.39.
NEMNICH, DI 29
Idaho Power Company
1 Results for each program calculation can be found in
2 Supplement 1 of the 2074 DSM Annua1 Report.
3 Q. Did Idaho Power calculate cost-effectiveness
4 tests for each measure within each program?
5 A. Yes. In 20L4, Idaho Power evaluated the
6 benefits and costs of 259 measures from both the TRC and
7 the UCT perspective. This number is l-ower than the number
8 of total measures in 2073 of 455. This reduction is not a
9 result of fewer measures offered by the Company; rather,
10 Idaho Power consolidated several categories of measures
11 after reviewing how the Company defines a measure. Of the
L2 total number of measures analyzed, 39 did not pass the TRC,
13 the UC test, oL both. It should be noted that Idaho Power
14 does not perform cost-effectiveness calculations by measure
15 in programs where there is significant interaction between
t6 measures.
77 The results of these cal-culations along with measure
18 assumption details and source documentation can be found in
19 Supplement 1 to the DSM 2014 Annual Report.
20 O. How did Idaho Power address the measures that
27 are not cost-effective based on one or more tests?
22 A. The cost and benefit values used in the
23 various analyses are based on markets, technologies,
24 economic inputs, savings estimates, and cost estimates,
25 which can change over time. When a measure is determined
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not to be cost-effective at a specific point j-n time, Idaho
Power first evaluates whether the inputs used in the
calculations are still correct, and then determines if
measure parameters should be modified or whether the
measure should be eliminated.As mentioned above, 39
individual measures j-n various programs are not cost-
effective from a TRC or UC test perspective or both. These
measures wilI be dj-scontinued, analyzed for additional non-
energy benefits, modified to increase potential per unit
savings, or monitored to examine their impact on the
specific program's overall- cost-effectiveness. Eor
additional detail on measure analysis refer to Supplement
1.
rv.
O. What
evaluati-on?
EVAIUATTON ACTIVITY OVER1IIEW
is the Company's approach to DSM program
A. In order to ensure the ongoing cost-
effectiveness of programs through validation of energy
savings and demand reduction, and to guide the efficient
management of its programs, the Company relj-es on
eval-uations by third-party contractors chosen through a
competitive bidding process, internal- analyses, and
regional and national- studies. Idaho Power uses industry-
standard protocols for its internal- and external- eval-uation
ef forts. Process and impact eval-uat j-ons are typically on a
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three-year cycle for each program; however, the timing of
specific program evaluations is based on consj-derations
regarding program needs. The Company actively participates
in regional groups that evaluate new technologies and
advancements. As discussed in the next section of my
testimony, the DSM MOU provj-des further direction on
how Idaho Power p1ans, evaluates, and reports its DSM
activi-ti-es.
O. Please provide an overview of the evaluation
acti-vit j-es that took place in 2014.
A.fn addition to the annual cost-effective
analyses that the Company conducts for each program, in
2014, Idaho Power completed five impact eval-uations on the
following programs: Energy Efficient Lighting, ENERGY STAR@
Homes Northwest, Custom Efficiency, A/C CooI Credit and
Irrigation Peak Rewards programs. Idaho Power completed
three process evaluations on the following programs: Shade
Tree Project, Home Energy Audit and Custom Efficiency. A11
these evaluations were conducted by third-party
contractors. The final- reports for these evaluations and
studies, and the market effects evaluations conducted by
NEEA, are included in SuppTement 2: EvaTuations
("Supplement 2") to the DSM 2014 Annual Report.
There were two research projects l-ast year. One of
the projects evafuated the EA4 software audlt tool for the
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WAQC and Sol-utions programs. And Idaho Power contracted
with the University of Idaho IDL to develop a
Weatherization HVAC Replacement Savings Calculator for the
WAQC and Solutions programs.
O. Does Idaho Power have a DSM program evaluatj-on
plan for 20L5?
A.Yes. The 201-1-2015 DSM Program Evaluation
Pl-an is attached as Bxhibit No. 3 and is also included 1n
Supplement 2. The emphasis tn 20!4 was on conducting
impact evaluations. In 20L5, Idaho Power's eval-uation plan
includes three impact eval-uations, three process
eval-uations, and several additional research projects.
This plan is intended to be used as a guide and may change
based on need, timing, or other factors.
V. STAKEHOI,DER INPIIT A}ID COMPLIANCE WITH
ERRATA TO ORDER NO. 33161
O. What opportunities exist generally for
external parties to provide input and guidance to Idaho
Power's DSM efforts?
A.In 2002, Idaho Power created the EEAG to
provide a forum to gather ideas and suggestions from
customers and special interest representatives about
formulating and implementing DSM programs. Members incl-ude
customer representatives from residential, irrigation,
commercial, and industrial- sectors, ds weII as
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representatives for senior citizens, lj-mited-income
individuals, environmental- organizations, state agencies,
the Idaho Public Utilities Commission, the Public Utility
Commission of Oregon, and Idaho Power. In 20L4, the EEAG
held four meetings, two webj-nars and an energy efficiency
potential study workshop. During these meetj-ngs, Idaho
Power discussed and requested recommendations on a broad
range of DSM issues. The mlnutes from the 2014 EEAG
meetings are included in Supplement 2 of the DSM 2014
Annual Report.
O. What was the result of Idaho Power's most
recent case where the Commission made a prudence
determination regarding the Company's DSM expenses?
A.On March 14, 2074, Idaho Power f il-ed Case No.
IPC-E-14-04 with the Commissj-on requesting an order finding
the Company had prudently incurred $25.9 million in DSM
expenses in 2013 for both energy efficiency and demand
response programs. In the filing, Idaho Power did not ask
for a prudence determlnation on the $89,601 Rider-funded
labor expense included in the 207L DSM expenses, the
$173,811 included in the 201-2 DSM expenses, or the $269,432
included in the 20L3 DSM expenses. On November 4, 20L4, in
Order No. 33161, the Commission deemed the total amount of
$25.9 million as prudently incurred.
NEMNICH, DI 34
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o.
received in
3 3161
A. In Order 33161, dated November 4, 201-4, the
Commission stated:
The Commissi-on notes that Idaho Power
issued a strong rebuttal of these
claims, offering severa1 reasons to
explain the recent decline in its DSM
expenditures and a defense of its
marketing efforts. While the Commission
is cognizant of the recent decl-ine in
energy savings, acknowledged by the
Company in its Application, we are
encouraged by the Company's reply
comments that its commitment to cost-
effective DSM has not waned and that it
has a renewed interest in taking action
to procure al-1 cost-effectj-ve DSM.
The Commission issued an Errata to Order No. 33161,
on November '1, 2014. fn the Errata, the Commission amended
this paragraph of the original order to read:
The Commission is cognizant of the
recent decline in energy savings,
acknowledged by the Company in its
Application, and notes that Idaho Power
issued a strong rebuttal- of theseclaims, offering several reasons to
explain the recent decllne in its DSMexpenditures and a defense of its
marketing efforts.We are encouraged
that the reply comments seem to
demonstrate the Company's renewed
interest 1n procuring al-l- cost-effective DSM.
In this case, the Commj-ssi,on restricts
its findings to the prudency of the
Company's 2013 expenditures. The
Commission agrees that the issues
raised by Staff and other parties are
NEMNICH, DI 35
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Pl-ease discuss the Errata to Order No
Case No. IPC-E-L4-04.
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1 significant and warrant a more in-depth
2 review. We direct the parties to do so
3 in the context of the Company's next4 Integrated Resource Pl-an filing.
56 Q. What activities did fdaho Power undertake to
7 comply with the Errata to Order No. 33161?
8 A. In response to the Errata, oD November 21.,
9 2014, Idaho Power organized an Energy Efficiency Working
10 Group and invited members of the Integrated Resource Pl-an
11 Advisory Commj-ttee ("IRPAC"), the EEAG, and other
72 interested parties to participate. The Energy Efficiency
13 Working Group hel-d two workshops to dj-scuss the j-ssues
74 referenced in the Errata to Order No. 33161.
15 The workshops were open to the public and held at
76 Idaho Power's corporate office from 1:00 4:00 p.m. on
11 December 3rd and from 9:30 a.m. 12:30 p.m. on December
18 18rh.
79 O. Pl-ease describe the two workshops.
20 A. The first workshop session included a
2L discussion of a broad range of energy efficiency and
22 resource planning issues that can be classified into two
23 general categories: (1) strategies rel-ated to program
24 delj-very and (2) treatment of energy efficiency in the
25 resource planning process. Because the IRP process does
26 not address program delivery lssues, Idaho Power
21 representatives suggested narrowing the focus of the
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discussion to only the treatment of energy efficiency in
the resource planning process and that the strategies
rel-ated to the successful delivery of programs woufd be
better addressed by the EEAG. While there were differing
opinions on this subject, participants agreed to severaf
agenda topics to be discussed at a second meeting that
focused on how energy efficiency as a resource should be
treated in the IRP.
The second workshop agenda included: A comparison of
energy efficiency potential studies from other regional
utilities by Ingrid Rohmund, Applied Energy Group; Idaho
Power's inclusion of energy efficlency in the IRP - a
comparison to other regional utilities by Stacey Donohue,
Commission Staff; Transmission and Distribution (T&D)
benefj-ts Idaho Power's investigation into including T&D
investment deferral into the benefits in DSM cost-
effectiveness analysj-s, by PhiI DeVoI, Idaho Power; and
other issues and open discussion. The information
presented at the second meeting prompted discussion among
the participants and ultimately served to inform Idaho
Power's next steps.
o.
A.
What are the next steps?
Idaho Power believes that its current
treatment of energy efficiency in the resource pJ-anning
process appropriately balances the need for responsible and
NEMNICH, DI 37
Idaho Power Company
1 effective resource planning and the desire to pursue al-l-
2 prudent cost-effective energy efficiency. Idaho Power also
3 recogni-zes that achieving those balanced objectives on an
4 ongoing basis requj-res conti-nued review and evaluation of
5 the planning process, ds wel-l as an awareness of related
6 industry best practices.
7 As discussed with the Energy Efficiency Workj-ng
8 Group, Idaho Power has committed to investigate the extent
9 to which T&D benefits result from energy efficiency
10 measures and programs, ds well as the approximate value of
11 such benefits. V0hen available, the Company will present
72 the results of this investigation to the IRPAC.
13 The Company is also committed to continue to discuss
t4 the program delivery issues identified by workshop
15 participants, and by Commission Staff, and some interveners
L6 in comments filed in Case No. IPC-E-14-04. The Company
77 plans to use the EEAG as the forum to provide customers,
18 Idaho and Oregon Commission Staff, and other interested
19 stakeholders an opportunity to provide advice and
20 recommendations to Idaho Power in formulating,
21, implementing, and evaluating energy efficiency and demand
22 response programs and activities.
23 O. Are there any updates to the work ldaho Power
24 j-s contj-nuing to do on the program delivery issues
25 identified by workshop particlpants?
NEMNTCH, Dr 38
Idaho Power Company
1 A. Yes. As promised, Idaho Power included an
2 extensive discussion of j-ts energy efficiency-related
3 marketing activities and new program ideas and initiatives
4 in the February 19, 20L5, EEAG meeting. Idaho Power plans
5 to include a robust marketing discussion in each of the
6 four regularly-scheduled EEAG meetings in 2015.
1 Q. Are there any updates to the work ldaho Power
8 is continuing to do on the T&D benefits of energy
9 efficiency?
10 A. Idaho Power is currently investigating the
11 potential T&D benefits of energy efficiency programs. A
1,2 discussion and preliminary findings are anticipated for the
1-3 June 201,5 IRPAC meeting.
14 VI. SATISFACTION OF DSM IilOU GUIDELINES
15 O. P1ease describe the DSM MOU.
t6 A. As part of Case No. IPC-E-09-09, Commission
t7 Staff, Idaho Power, and other investor-owned utilities
18 operating in Idaho worked together to establ-ish an agreed-
t9 upon set of terms for future evaluation and reporting of
20 DSM expenditures and programs. In January 20L0, the Staff,
27 fdaho Power, Avista Corporation, and Rocky Mountain Power
22 signed the DSM MOU. The DSM MOU provides a set of
23 guidelines for evaluatlon and reporting of DSM performance
24 with the purpose of facilitating an objective and
25
NEMNTCH, Dr 39
Idaho Power Company
2
3
4
5
6
7I
9
1_0
11
72
13
74
15
t6
77
18
79
20
2L
22
23
24
25
26
21
28
29
30
31
transparent assessment of the utilities' DSM efforts. The
DSM MOU statesr oD page 6, item 10:
A showing by the utility that it made
a good faith effort to reasonablyperform within these guidelines will
constitute prima facie evidence that
the utility's DSM expenses wereprudently incurred for cost recoverypurposes. By its performing wlthin
these guidelines, assuming there is no
evidence of imprudent acti-ons or
expenses, the utillty can reasonably
expect that in the ordJ-nary course of
business Staff will support ful-I cost
recovery of its DSM program expenses.
Does Idaho Power believe that this filing
satisfies the reporting obligation for DSM activity as set
forth in the DSM MOU?
A.Yes. Idaho Power has followed the template,
table of contents, highlights, and program specific
sections as reconrmended in the DSM MOU. This information
can be found in the main document of the DSM 2014 Annual
o.
Report. In Supplement L,
cost-effectiveness detail
Supplement 2 supplies the
in the DSM MOU.
Idaho Power has provided the
for programs and measures and
evaluation j-nformation requested
VII. CONCLUSIOII
O. Do you believe that the information contalned
in this testj-mony and attached documents supports a
prudence determination for 20L4 DSM expenses?
NEMNICH, DI 40
Idaho Power Company
1
2
3
4
5
6
1
I
9
10
11
72
13
74
15
16
t7
18
19
20
2t
22
23
24
25
o.
A.
A.Yes. Based on the testimony set forth above
and in the attached exhibits, Idaho Power respectfully
requests the Commission determine that $33,495,385 of DSM
expenses incurred in 2014 for the acquisition of demand-
side resources were prudently incurred.
Does this conclude your testimony?
Yes, it does.
NEMNTCH, Dr 4L
Idaho Power Company
1
2
3
4
5
6
7
8
9
10
11
t2
13
!4
15
t6
L7
18
t9
20
27
22
23
24
25
26
27
28
29
30
31
STATE OF
County of
IDAHO )
)Ada )
SUBSCRTBED AND
March 2015.
ATEESTATTON OF TESEIIOIrI
SWORN to before me this 13th day of
for
Residing at:
exp res : /A -ao - 90
NEMNICH, DI 42
Idaho Power Company
ss.
I, Darlene Nemnich, having been duly sworn to
testify truthfully, and based upon my personal knowledge,
state the following:
I am employed by Idaho Power Company as a Senior
Regulatory Analyst in the Regulatory Affairs Department and
am competent to be a witness j-n this proceeding.
I declare under penalty of perjury of the laws of
the state of Idaho that the foregoing pre-filed testimony
and exhibits are true and correct to the best of my
information and belief.
DATED this 13th day of March 2075.
Nemnich
o
Idaho
My commission
ottlttttttt-"t.,' ".,.f*ii"'*i{**..
f ;f-T.:" \-"i1$i'f ();r
-a-Jt.l n$s1.,*-:).&itor.ttOt ltr Tt -."'".rr.r'r, i.i.r....'-
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
GASE NO. IPC-E-I5-06
IDAHO POWER COMPANY
NEMNIGH, DI
TESTIMONY
EXHIBIT NO. 1
ldaho Power Company
2014 ldaho DSM Expenses and Adjustments for Prudence Filing
Erpon3es
Demand R$ponae
Ridar Erp€nses Piooram lncgntivD3
ldaho Ridcr
Labor
Transfered to
Total Expome3 O&t ts'}
Enoryy Efrcie/,cylD$E dResporse
Re3idontlal
Ar'C Cool CGdit
Duc'tess Heat Pump Pilot
Energy Effcient Lighting
Energy House Calls
ENERGY STARO Homes
Heating & Cooling Effciency Program
Home Energy Audit Program
Home lmpmvement Program
Home Products Program
Rebate Advantage
See ya later, rcfrilerator@
Shade Trse Program
Weatherization Solutions for Eligible Customers
Commercial/lndustdal
Building Efficiency
Custom Effciency
Easy Upgrades
FlexPeak Managemenl
lrrigation
lnigation Efriciency Re\Mards
$
$
$
$
$
$
$
$
$
$
$
$
$
962,286 $
235,099 $
1,860,046 S
186,732 $
330,523 $340,551 $
164,579 0315,616 $
212,787 $
57,155 t562,002 0
143,750 $757,7$ $
1,212,507 $
6,705,219 $
3,020,323 $50,964 $
2,256,235 $
1 37172t S
437,940
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
1,427,Oil
0
6 075 703
1A40226 $235,09S $1,860,(X6 $186,732 $330,523 $3/tO,551 $16/t,579 $315,616 S212,787 $57,155 S562p02 $143,7fi $757,748 $
1,212,W7 S6,705,219 $3,020,323 S1,478,018 $
$i
E
$
$
s
$
$
$
$
s
$
$
8,433
6,733
3,818
3,080
4,391
6,836
6,3'18
9,101
5,139
753
1,639
3,474
725
14,315
49,299
17,996
7,062
lridalidn Paak Flalmr.lq S
$
$
s
$
$
s
s
$
$
$
$2,256,235 $ 26,090715r)a?7 S 5312
Fnafrw FfraieDavDcfrenal Refinq T6tal I 20-7/rg 2a5 *79m697 I 2A AnO 942 tm sl1
tarlet Tran3formation
Norlhmsl Fn.mv Fffichncv Allirn.!3 140621 S 3 110 621
Resftlential Energy Efficiency Educalion lniliative
Commercial Energy Efrciency Education lnitiative
Eneroy Efficiency Direct Program Overhead
Loel Enerov Fftcicnd Funds
$ 394,895 $$ 72.613 $$ 427,s06 $$ 9100 s
39/1,895 $ 13,34072,613 $ 163127,506 S 29,1119100 3 -
0s090$o3
Olh* Pffinms and Actiyities Total S 901.111 t 0s 9{t1.111 S
lndirec-t Program Expons6s
CommerciaUlnduslriaulnigation Overhead
Energy Efficiency Accounting and Anaiysis
Energy Efficiency Advisory Group
Residential Overhead
Spec ial Accou nting E nties
Soecial Accountind Fnlries
$
$
$
$
$
75,578
693,729
5,702
79,1 37
/.92.O37\
$
$
$
$
$
0$0$0$0$
$
$
$
$
s
75,578
693,729
5,702
79,137
(92.O37)
10,612
56,387
18.251
Total ErDenses 3 25.556.089 S 7.940.597 S 33.4!16.786 338.707
Adiustments
Prior year-end accounting adjustment :(b)
Home Energy Audit Program conection
Cunent year-end accounting adjustment :(o)
Energy House Calls Program conecrlion
(2481
(1,153)
(248\
(1,1s3)
(a) Thiscdmnisb.illusIratiwprpqss ,lcgesarstieaMtorlabtinitiallychugedtotheldilroEnqgyEfrciffiyRidqin2ollinew$olthem10'dmedNudilt'ffi@L The*runts
w* lnnshted to O&M in 201 1. Thes etuunt. * not indrdd in the amunls tound in the 'Flhl* Eryans" column ol this erhiti. ,rre$ aruorls e @rsir@d progrM 6rs @d e u@d t*
@st{ere/il ilar}cl9 p.nposs
(b) This is an a@unling mdiq E/rtaining lo m13 hil was mdd in m11 ild gtfuld M srblraf,ed lo Ef,&t tolal exa,ne etiw in 2011.
(c)Thisvasane@wtitgwedtunmadein20lSbdNlainingbmlladivityildslaubbesbtetedtoretudtotalexQneadiwhnll. fwoi@tiwshadthewg@ntingMts@n
ho ldaho Endgy Efrcaoncy Rklq frd lhe Oegon Enqgy Efrciilcy Rit*, ,telling in tho ldaho Eneqy Etrbbnay Rktq bing cha,ged M thao il dtoutd hNe bafi.
Exhibit No. 1
Case No. IPC-E-15-06
D. Nemnich, IPC
Page 1 of 1
BEFORE THE
IDAHO PUBLIG UTILITIES COMMISSION
GASE NO. IPC-E-I5-06
IDAHO POWER COMPANY
NEMNICH, DI
TESTIMONY
EXHIBIT NO.2
ldaho Power Company
2014 Cost-Effectiveness Summary by Program, Sector and Portfolio
2014 BenefiUCost Tests
Program/Sector
Total Resource
Cost (TRC)Utilitv Cost (UG)
Participant Cost
(PCT)
)uctless Heat Pumo Pilot 0.70 't.77 1.01
Inerqv Efficient Liohtinq 1.99 2.98 2.67
Enerqy House Calls 2.',t6 2.16 N/A
ENERGY STAR O Homes Northwest 0.83 't.64 1.41
Heatinq & Coolino Efficiencv Prooram 1.09 3.74 1.45
Home lmorovement Prooram 1.51 4.17 2.39
Home Products Prooram 4.52 1.94 7.28
Rebate Advantaoe 3.23 4.39 6.21
See va later, refriqerator @ 0.86 0.86 N/A
Student Enerov Efficiencv Kit 3_O2 2.18 N/A
Weatherization Assistance for Qualified Customers o.42 0.51 N/A
Weatherization Solutions for Elioible Customers 0.s0 0.46 N/A
Residential Enerqv Efficiencv Sector 1.51 1.88 2.68
Building Efficiency 2.08 5.05 2.27
Sustom Efficiencv 2.52 4.72 2.OO
Easv Uoqrades 2.35 4.08 2.85
Commercial/lndustrial Energy Efficiency Sector 2.42 4.58 2.24
nioation Efficiencv 1.83 5.67 1.63
lrrioation Enerov Efficiencv Sector 1.83 5.67 1.63
Eneroy Efficiency Portfolio 1.89 3.49 2.09
Exhibit No. 2
Case No. IPC-E-15-06
D. Nemnich, IPC
Page 1 of 1
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
GASE NO. !PC-E-l5-06
IDAHO POWER COMPANY
NEMNIGH, DI
TESTIMONY
EXHIBIT NO.3
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Exhibit No. 3
Case No. IPC-E-15-06
D. Nemnich, IPC
Page 1 of 1