20180126Levin Rebuttal.pdf

John R. Hammond, Jr. - ISB No. 5470
FrsurR Puscu t-t-p
U.S. BANK PLAZA- 7.h Floor
101 s. Capitol Blvd., Suite 701
P.O. Box 1308
Boise, ID 83701
Telephone: [phone]
Facsimile: 208.331.2400E-mail: [e-mail]
Attorneys for the Snake River Alliance and NW Energt Coalition
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE
APPLICATION OF IDAHO POWER
COMPANY FOR AUTHORITY TO
ESTABLISH NEW SCHEDULES
FOR RESIDENTIAL AND SMALL
GENERAL SERVICE CUSTOMERS
WITH ON-SITE GENERATION
RT'CE,VED
IArc J/lfi 26 Ptr $ 33
u r / r i ?l tjJj## iii l$r, o*
CASE NO. IPC-E-I].13
PREFILED REBUTTAL TESTIMONY (NONCONF'IDENTIAL) OF
AMANDA M. LEYIN
January 2612018
REBUTTAL TESTIMONY (NONCONFIDENTIAL) OF
AMANDA M. LEVIN
CONTENTS
I. INTRODUCTION
il. STAFF'S PROPOSAL FOR SCHEDULE 84
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Rebuttal Testimony
Qtlonconfidential) of
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REBUTTAL TESTIMONY (NONCONFIDENTIAL) OF
AMANDA M. LEVIN
I. INTRODUCTION
a. Are you the same Amanda M. Levin who provided Prefiled Direct
Testimony and supporting exhibits on December 22,2017, in this proceeding on
behalf of the Snake River Alliance and NW Energy Coalition?
A. Yes.
a. What is the purpose of this rebuttal testimony?
A. I respond to the Idaho Public Utilities Commission Staff s ("Staff') proposal to
modifu Schedule 84. Staff proposes to keep net metering customers in the broader
residential and general service classes, but proposes alterations to the energy export rate
for these customers. Staff suggests that net metering customers are compensated for the
excess energy at the avoided cost rate to "correct any intraclass cost shift without
requiring any new rate classes."l
a. Please summarize your rebuttal testimony.
A. I agree with Staff that Idaho Power Company's (the "Company") proposal to
create a new rate class should be denied at this time and commend them for offering a
proposal that would allow net metering customers to remain in these broader rate classes.
However, I disagree with Staff s methodology and finding of a cost shift between net
I Morrison, Michael, Direct Testimony on Behalf of Staff, at page 3
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1 metered and non-net meter customers that underlies its proposal. I also discuss Staff s
use of the avoided DSM cost rate in its initial proposal and provide input on the process
and benefits that should be considered in the development of any energy export rate for
net metered systems, if Staff s proposal is adopted.
II. STAFF'S PROPOSAL FOR SCHEDULE 84
a. Do you agree with Staffs recommendation that the Commission deny the
Company's Application to create a separate rate class at this time?
A. Yes. Despite the Company's claim that net-metered customers should be
separated into distinct rate classes due to different consumption and load profiles,
Staffls own analysis shows that net-metered and non-net-metered customers have very
similar consumption patterns.2 Staff witness Michael Morrison used hourly
consumption data provided by the Company to conduct an analysis of consumption
between net-metered and non-net-metered customers. Staff s analysis used data for all
net-metered customers with a full year of consumption data in20l6, providing a more
robust and accurate picture of this group's consumption and load profile than the
Company's analysis included in the Direct Testimony of the Company's witness David
M. Angell.3
a. Do you agree with Staff s statements about the intraclass cost shift created
by Schedule 84 or its revised projected cost shift?
2 Morrison, Michael, Direct Testimony on Behalf of Staff at page 16-19.
3 Angell, David M., Direct Testimony on Behalf of Idaho Power Company at page 11
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A. No. Staff states that "net metering customers are being overcompensated for the
energy they produce."4 They argue that the value of energy provided by net metering
customers is primarily the utility's avoided energy rates, but customers are
compensated at the full retail rates (which are substantially higher than the utility's
energy costs).s However, testimony provided by both Staff and other intervenors
suggest this may not be accurate. These systems provide other measurable value along
the entire utility system, from the generation to transmission to distribution of energy.
For example, Sierra Club Witness R. Thomas Beach provides analysis of the impacts,
benefits, and costs of NEM customers on the system and to other ratepayers. Witness
Beach noted analysis he had completed as part of testimony submitted in a previous
case that found the levelized capacity and transmission benefits of distributed
generation was 4 and 3.2 cents per kWh, respectively, using the Company's 201 I and
2013lntegrated Resource Plan.6 This was greater than the value of the energy from
these systems in the same analysis. Witness Beach also considers the benefits of
avoided distribution costs not reflected in his earlier analysis. He estimates that one
kW of distributed generation nameplate capacity in the Company's territory avoids 0.22
kW and 0.31 kW of marginal distribution capacity costs for south and west-facing
capacity, respectively.T
4 Morrison, Michael, Direct Testimony on Behalf of Staff at page 9.
s Morrison, Michael, Direct Testimony on Behalf of Staff at page9.
6 Beach, R. Tom, Direct Testimony on Behalf of Sierra CIub at page 13.
7 Beach, R. Tom, Direct Testimony on Behalf of Sierra Club at page 30-31
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Stafls own analysis also supports the finding that these net metering systems provide
value to the system over and above the utility's value of avoided energy generation.
According to Staff analysis, the average contribution of a net-metering customer to
system peak (in 2016) was 2.31 kW versus 2.86 kW for non-net metering customers.8
Net metering customers did have larger average individual peaks and group non-
coincident peaks.e
As part of Staff s proposal, Staff provides a revised estimate of the cost shift between
net metered and non-net metering customers. They estimate a cost shift of $137.25 a
year, assuming that the excess energy provided by net metering is worth the utility's
avoided DSM rates.l0 While Staff arbitrarily used the avoided DSM costs as a proxy
for the value of energy provided from these systems, this is likely a significant
underestimate. These systems provide additional quantifiable benefits to the system,
other ratepayers, and the utility across its generation, transmission, and distribution
system over and above the DSM avoided cost used. Since a methodology for
calculating the value of these other service has not yet been determined, it is too early
to say whether current NEM customers are creating a measurable cost shift. Instead of
relying on an arbitrary calculation like DSM avoided cost, the Company should conduct
a Resource Value of Solar analysis to determine the actual cost and benefits to the
system. This analysis must be conducted in a transparent and open way with sincere,
8 Morrison, Michael, Direct Testimony on Behalf of Staff (Rev.) at page 16.
e Morrison, Michael, Direct Testimony on Behalf of Staff (Rev.) at page 16.
r0 Morrison, Michael, Direct Testimony on Behalf of Staff (2'd Rev.) at page 12
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substantive opportunities for stakeholder engagement and feedback. Only at that point,
can a true determination be made on the value of excess generation.
a. Do you support Staff s proposal to alter Schedule 84?
A. Not at this time. I appreciate that Staff s proposal would allow net-metered
customers to remain part of Residential Schedule I and Small General Service
Schedule 7. However, the benefits to be quantified and included in the export rate, and
the resulting value for exported energy, are still unclear. Without a more defined
methodology or value of excess energy to study, I'm not confident Staffls proposal will
improve upon the current net metering approach in Idaho.
Staff indicates that they believe the methodology for calculating net metering avoided
cost should be determined in a separate docket, rather than using the2016 DSM
avoided cost rates included in Staff s testimony.ll I support the creation of a separate
docket to determine the appropriate export rate for net metering customers in the
Company's service territory. Any valuation study and resulting export rate should
reflect all benefits of the energy generated by these net metering systems, including
time and location of generation; avoided fuel cost; other avoided plant expense;
avoided generation, transmission, and distribution system capacity and/or avoided
upgrades; avoided line loss; and environmental benefits, among other benefits
identifi ed by stakeholders.
I I Morrison, Michael, Direct Testimony on Behalf of Staff at page 1 I .
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I Given the low levels of penetration in the Company's territory currently, there is no
need to rush through a revision to net metering. The Idaho Public Utilities Commission
should ensure that any revisions are done in a thoughtful, deliberate way. Opening a
new docket to determine a methodology for or proposed value of excess energy before
acting on the rest of Sta{Ps proposal will provide parties with the information necessary
to determine if the proposal actually advances public policy objectives.
DOBS THIS CONCLUDE YOUR TESTIMONY?
Yes.
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CERTIFICA OF SERVICE
I HEREBY CERTIFY that on the 26th day of January,2}l8, I served a true and correct
copy of the foregoing by delivering the same to each of the following individuals by electronic
mail, addressed as follows:
IDAHO POWER COMPANY:
Lisa Nordstrom
Idaho Power Company
l22l w. Idaho st. (83702)
PO Box 70
Boise, lD 83707
lnordstrom@idahopower. com
[e-mail]
Timothy E. Tatum
Connie Aschenbrenner
Idaho Power Company
l22lW. Idaho St. (83702)
PO Box 70
Boise, ID 83707
[e-mail]
caschenbrenner@idahopower. com
COMMISSION STAFF:
Sean Costello
Deputy Attorney General
Idaho Public Utilities Commission
472 W. Washington (83702)
PO Box 83720
Boise, lD 83720-0074
[e-mail]. eov
Idahydro
c/o C. Tom Arkoosh
Arkoosh Law Offices
802 W. Bannock Street, Suite 900
PO Box 2900
Boise, ID 83701
[e-mail]
[e-mail]
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IDAHYDRO:
IDAHO IRRIGATION PUMPERS
ASSOCIATION, INC.:
Idaho Irrigation Pumpers Association, Inc.
c/o Eric L. Olsen
Echo Hawk & Olsen, PLLC
505 Pershing Avenue, Ste. 100
PO Box 6l l9
Pocatello, ID 83205
[e-mail]
Anthony Yankel
12100 Lake Avenue, Unit 2505
Lakewood, OH 44107
[e-mail]
IDAHO CONSERVATION LEAGUE:
Matthew A. Nykiel
Idaho Conservation League
PO Box 2308
102 S. Euclid#207
Sandpoint, ID 83864
mnykiel@idahoconservation. org
AURIC LLC:
Elias Bishop
Auric Solar, LLC
2310 s. i300 w.
West Valley City, UT 84119
elias.bishop@auricsolar. com
Preston N. Carter
Deborah E. Nelson
Givens Pursley LLC
601 W. Bannock Street
Boise, lD 83102
prestoncarter@ givenspursl ey. com
den(@ gi v en spursl ey. com
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SIERRA CLUB:
Kelsey Jae Nunez LLC
Siera Club
920 N. Clover Drive
Boise, ID 83703
kel se)r@ke I seyj aenunez. com
Tom Beach
Crossborder Energy
2560 9th Street, Suite 213,A.
Berkeley, CA 94710
E-mail: [e-mail]
ELECTRONIC SERVICE ONLY:
Michael Heckler
michael.p.heckler@ gmail. com
Zack Waterman
zack. waterman@ sierraclub. or g
CITY OF BOISE CITY:
Abigail R. Germaine
Deputy City Attorney
Boise City Attorney's Office
150 N. Capitol Blvd.
PO Box 500
Boise, ID 83701-0500
Telephone: [phone]
Facsimile: (208) 384.445 4
aqermaine@cityolboise. org
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IDAHO CLEAN ENERGY
ASSOCIATION:
Preston N. Carter
Deborah E. Nelson
Givens Pursley LLC
601 W. Barurock Street
PO Box2720
Boise,ID 83701
prestoncarter@ given spurs ley. com
den(A givenspursley.com
VOTE SOLAR:
David Bender
Earthjustice
3916 Nakoma Road
Madison, WI 53711
dbender@ earthj ustice. or g
Briana Kober
Vote Solar
360 22"d Street, Suite 730
Oakland, CA 94612
[e-mail]
INTERMOUNTAIN WIND
AND SOLAR, LLCI.
Ryan B. Frazier
Brian W. Burnett
Kirton McConkie
50 East Temple, Suite 400
PO Box 45120
Salt Lake City, UT 841I I
[e-mail]
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Intermountain Wind and Solar, LLC
1952 West 2425 South
Woods Cross, UT 84087
dou [e-mail]
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