20180430notice_of_application_order_no_34052.pdf

Office of the Secretary
Service Date
April 30,2018
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF IDAHO POWER )CASE NO.IPC-E-18-03
COMPANY'S APPLICATION FOR A )DETERMINATION OF 2017 DEMAND-)NOTICE OF APPLICATION
SIDE MANAGEMENT EXPENSES AS )PRUDENTLY INCURRED )NOTICE OF
)INTERVENTION DEADLINE
)NOTICE OF
)MODIFIED PROCEDURE
)ORDER NO.34052
On March 15,2018,Idaho Power Company (the "Company")applied for a
Commission order fmding that the utility'sdemand-side management (DSM)expenses for the year
2017 were prudentlyincurred.The Company seeks to recover $44,145,316 in deferred costs for
its DSM programs,which includes $37,162,002 in Idaho Energy Efficiency Rider expenses,and
$6,983,314 in demand response program incentives."DSM"generally refers to utility activities
and programs that encourage customers (i.e.,on the "demand-side"as opposed to the "generation
side")to use less overall energy or use less energy during peak usage hours.The Commission will
allow the utility an opportunityto recover its DSM expenses through rates if the Commission finds
the Company prudentlyincurred them.However,if the Commission finds the Company did not
prudently incur DSM expenses,then it will not allow the Company to recover them through rates
and the disallowed expenses will be borne by the utility's shareholders and not by customers.
NOTICE OF APPLICATION
YOU ARE HEREBY NOTIFIED that the Company states its 2018 DSM efforts
included Northwest Energy EfficiencyAlliance (NEEA)market transformation activities,energy
efficiency programs,demand response programs,and several educational initiatives.Application
at 3.The Company states these efforts increased the Company's annual energy savings by 12%
and exceeded the savings target specified in the Company's IntegratedResource Plan.Application
at 2.The Company noted its energy efficiency programs saved 191,478 megawatt hours (MWh),
comprising 65,506 MWh from the residential sector,85,425 MWh from the commercial/industrial
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sector,16,888 MWh from the irrigation sector,and about 23,652 MWh frorn the NEAA initiatives.
Id
YOU ARE FURTHER NOTIFIED that the Company funds its Idaho programs through
the Idaho Energy Efficiency Rider,base rates,and the annual Power Cost Adjustment (PCA).
Application at 5.It funds its Idaho demand response incentive payments through base rates and
the PCA.Id With this Application,the Company asks the Commission to find that the Company
prudentlyincurred $44,145,316 in expenses to develop and run its DSM programs in 2017.Id
The Company states these expenses include $37,162,002 in Idaho Energy Efficiency Rider
expenses and $6,983,314 in demand response program incentive payments.Id The Company
made one accounting adjustment for 2017 of $89,304 relating to labor expenses not recorded as
part of the Rider expense prior to disclosure of the 2017 accounting books.Id at 6.The Company
made five adjustments for 2016,including a decrease of $56,571 related to the Weatherization
Solutions for Eligible Customers Program and four other increases totaling $43,185.Id
YOU ARE FURTHER NOTIFIED that the Company's Application describes the
Company's evaluation of its DSM programs and whether they were cost-effective in 2017.Id at
7.The DSM Report discusses the cost-effectiveness of the Company's DSM programs and energy
savings measures.Id In support of its Application,the Company submitted prefiled testimony of
Connie Aschenbrenner,Regulatory Analyst,an annual DSM report,the results of its cost-
effectiveness analysis,and the third-partyprogram evaluation reports.Id
YOU ARE FURTHER NOTIFIED that the Company explains it used the following
benefit/cost tests to determine the cost-effectiveness of its energy efficiency programs and
measures:(1)the total resource cost test (TRC);(2)the utility cost test (UCT);and (3)the
participant cost test (PCT).'Id The Company reports that in 2017 its overall energy efficiency
portfolio was cost-effective,passing the TRC,UCT,and PCT,with ratios of 2.50,2.75,and 3.67
respectively.Id Of the Company's 16 Idaho energy efficiencyprograms,11 programs passed the
i The three tests examine a program's cost-effectiveness from different perspectives.In summary,the TRC
compares program administrator costs and customer costs to utility resource savings,and assesses whether the total
cost of energy in a utility's service territorywill decrease.The UCT compares program administrator costs to
supply-side resource costs,and assesses whether utility bills will increase.The PCT compares the costs and benefits
of the customer installing the measure,and assesses whether program participants will benefit over the measure's
life.
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TRC and UCT.AschenbrennerDirect Testimony at 22.Further,all energy efficiency programs
with customer costs passed the PCT with the exception of the Home Improvement Program which
was discontinued on June 30,2017.Application at 8.Id.Due to a lack of cost-effectiveness,the
Fridge and Freezer Recycling Program ended on December 31,2017.Application at 8.Although
they are not cost-effective,Idaho Power intends to continue to work towards greater cost-
effectiveness for the Weatherization Assistance for Qualified Customers Program,Weatherization
Solutions for Eligible Customers Program,and the Heating and Cooling Efficiency Program,
because they offer benefits that are difficult to quantify.Id
YOU ARE FURTHER NOTIFIED that when assessing the cost-effectiveness of its
demand response programs the Company did not calculate a benefit/cost ratio.Id.at 9.Rather,
the Company determined the cost-effectiveness of its demand response programs based on the
$16.7 million demand response portfolio value specified in Commission Order No.32923,and
estimated that the programs would have cost approximately 11.1 million on a system-wide basis
and are less than the value of the demand,calculated to be $19.8 million.Id
YOU ARE FURTHER NOTIFIED that the Company states independent,third-party
consultants provide impact and process evaluations to verify that program specifications are met,
recommend improvements,and validate program-related energy savings.Id.In 2017,two
combined program impact evaluations and programs process evaluations were completed.Id at
10.
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 "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 jurisdictionunder 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 31.01.01.000 et seq.
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NOTICE OF INTERVENTION DEADLINE
YOU ARE FURTHER NOTIFIED that persons desiring to imerwoe in this matter to
obtain parties'rights of participation must file a Petition to Intervene with the Commission
pursuant to this Commission's Rules of Procedure 72 and 73,IDAPA 31.01.01.072 and -.073.
Persons who wish to intervene as a party must file a Petition to Intervene no later than 21
days after the date of service of this Order.Persons desiring to present their views without
parties'rights of participation are not required to intervene and may present their comments
without prior notification to the Commission or the parties,as described below.
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 31.01.01.201 through .204.
YOU ARE FURTHER NOTIFIED that any person desiring to state a position on this
Application may file a written comment in support or opposition with the Commission by July 19,
2018.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 Application shall be mailed to the Commission and the Applicant at the
addresses reflected below:
Commission Secretary Julia A.Hilton
Idaho Public Utilities Commission Idaho Power Company
PO Box 83720 PO Box 70
Boise,Idaho 83720-0074 Boise,ID 83707-0070
Email:[e-mail]
Street Address for Express Mail:[e-mail]
472 W.Washington Street Connie Aschenbrenner
Boise,ID 83702-5918 Idaho Power Company
PO Box 70
Boise,ID 83707-0070
E-mail:[e-mail]
NOTICE OF APPLICATION
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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 wmv.puc.idaho.gov.Click the "Case Cornment or Question
Form"under the "Consumers"tab,and 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 at the
e-mail addresses listed above.
YOU ARE FURTHER NOTIFIED that the Company shall file reply comments,if any,
by August 2,2018.
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 Application be processed under Modified
Procedure,Rules 201-204,IDAPA 31.01.01.201-.204.
IT IS FURTHER ORDERED that persons desiring to intervene in this case for the
purpose of obtaining parties'rights of participation must file a Petition to Intervene with the
Commission,pursuant to Rules 72 and 73,IDAPA 31.01.01.72-73,no later than 21 days after the
service date of this Order.
IT IS FURTHER ORDERED that persons interested in submitting written comments
must do so by July 19,2018.The Company may file a reply no later than August 2,2018.
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DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this
day of April 2018.
PAUL KJÉLÌ AN̽,PRESIDENT
KRInlNE RAPER,COMMISSIONER
ERIC ANDERSON,COMMISSIONER
Diane M.Hanian '
Commission Secretary
IPCE1803 ntcofapp epl
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