20180719Comments.pdf

Benjamin I. Otto (ISB No. 8292)
710 N 6'h Street
Boise,ID 83701
Ph: [phone] x12
Fax [phone]
[e-mail]
Attorney for the Idaho Conservation League
IN THE MATTER OF THE )
APPLTCATTON OF IDAHOPOWER )
COMPANIY FOR A DETERMINATION )
oF 2017 DEMAND-SIDE )
MANAGEMENT EXPENSES AS )
PRUDENTLY INCURRED. )
IPC-E-18-03
ICL COMMENT
I?TCEIVED
irllil .iLL I 9 Pl{ 12: 32
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
The Idaho Conservation League (ICL) submits the following comments regarding Idaho
Power's 2017 Demand Side Management programs. Yet again Idaho Power's 2017 energy
savings vastly exceed the "targets" the Company choose to include in the most recent Integrated
Resource Plan. Achenbrenner at 10. More importantly, all customers benefit from this
achievement. For each dollar spent on the Residential portfolio, the utility received $2.69 in
benefits and the entire body of customers received $3.64 in benefits. 2017 DSM Report at 35.
The Irrigation portfolio performed even better, with $l of investment yielding $a.78 in benefits
to the utility and $3.65 to all utility customers. Id. The Commercial and Industrial portfolio
delivered a large portion of the overall savings, although at a slightly lower benefit to cost ratio
of $3.42 and $1.81 of benefits per dollar invested for the utility and all customers respectively.
Id These results establish that energy efficiency programs continue to be solidly in the public
interest and are a prudent use of ratepayer funds, especially since the "utility benefits" actually
accrue to customers through lowering the cost of resources we all pay for. ICL recommends this
Commission find prudent the investments made in20l7 and direct Idaho Power to continue to
grow the depth and breadth of the efficiency portfolio.
CASE NO. IPC.E-18-03
IDAHO CONSERVATION LEAGUE
COMMENTS
July 18,20181
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While ICL recommends the Commission find Idaho Power's 2017 DSM investments
prudent overall, we do have comments in a few specific areas: the Home Improvement Program,
Multifamily Housing, Marketing, Municipal Water and School Cohorts, and assessing efficiency
as a resource. Because these annual DSM reviews cover programs that operate for several years,
ICL encourages the Commission to provide direction to stakeholders going forward to ensure the
programs remain prudent and effective for all customers.
Home Improvement Program
One of the major changes during 2017 was Idaho Power ending the Home Improvement
Program that provided incentives for residential insulation and windows. ICL notes that the
Utility Cost Test, which measures the costs and benefits to the utility, shows $2.54 in benefits for
each dollar invested. 2017 DSM Report at 81. Despite this cost effective result, Idaho Power
suspended the program in20l7.ICL will not rehash the arguments put forth in IPC-E-17-03
conceming this issue, to which the Commission stated, "'We are concemed that a cost effective
program was discontinued." Order No 33908 at 7.ICL notes the 2017 DSM Report shows that
one measure in the eliminated program - multifamily attic insulation - remains cost effective
under both the Utility and Total Resource perspectives. 2017 DSM Report Supplement I at 29
(mislabel as /loor instead of attic).
Multifamily Housing
Regarding multifamily housing, ICL is encouraged the pilot program started by Idaho
Power in2016 developed into a full-scale program in2017. 2017 DSM Report at 84. Multifamily
housing is a particularly important sector for utility efficiency program because of the "split
incentive" issue, whereby a landlord has little incentive to invest in efficiency improvements and
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ICL COMMENT
2 July 18,2018
the tenant has little ability to do so on their own. Through the program, Idaho Power provides
tenants efficient light bulbs and measures to reduced hot water demand. But the program does
not include the known to be cost effective attic insulation, a measure that delivers $3.90 and
$1.33 to the utility and all customers respectively for each dollar invested. 2017 DSM Report
Supplement I at 29 (mislabel as /loor instead of attic).ICL recommends the Commission remind
Idaho Power of their obligation to pursue all cost effective energy efficiency, which should
include, at a minimum, ensuring measures the Company knows are cost effective from multiple
perspectives are included in existing programs that target the same customer sector and end use.
Marketing
Another trend in 2017 was Idaho Power's continued expansion of efficiency marketing
efforts. ICL strongly supports this improved effort because programs without participants do not
benefit anyone. The2017 DSM Report documents a continual expansion of Idaho Power's
marketing efforts. But the Report does not document how these efforts translate into an increase
in program participation by customers. Idaho Power does include information about customer
satisfaction surveys. 2017 DSM Report at 35 - 36.lCL notes two things. First, whether person is
"satisfied" is not a meaningful metric because it is an ambiguous word that relies completely on
individual perceptions. Second, the survey does include a more meaningful metric, 44oh of
surveyed customers participated in efficiency programs. Percentage of customers participating in
programs is a meaningful metric because it measures an activity, not a perception, that is the
main goal of the entire DSM program. While 44ohparticipation is a good start, this also indicates
a vast potential to increase participation by engaging more effectively with customers. ICL
recommends the Commission continue to encourage Idaho Power to promote efficiency
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programs and work with the Energy Efficiency Advisory group and other experts to devise
strategies and tactics that lead to energy savings, not merely customers reporting "satisfaction".
Municipal Water Supply and School Building Cohorts
Another positive trend in 2017 was Idaho Power's extension of the Municipal Water
Supply and Schools cohort programs. 2017 DSM Report at I22 - 123. These innovative
programs bring together peer groups of people who actually operate water supply systems and
school buildings. Through coaching, sharing best practices, energy use benchmarking, and
technical assistance, Idaho Power is encouraging low cost savings through behavioral changes,
as well as educating facility owners to consider deeper energy saving opportunities. ICL is
particularly encouraged by these programs because improving efficiency in both of these sectors
leads to broad public benefits through reduced water supply costs for citizens and better schools
for Idaho's kids. ICL recommends the Commission specifically acknowledge the importance of
the cohort programs and encourage Idaho Power to expand partnerships with municipalities and
school districts.
Assessing Efficiency as a Resource
ICL's final comment regards the metrics used to measure whether an efficiency program
is cost effective resource. For several years now Idaho Power, the Idaho PUC Staff, and ICL
have engaged in a debate about the most appropriate "test" to compare the costs and benefits of
an efficiency program. Idaho Power has traditionally used the "Total Resource Cost Test" that
purports to capture the costs and benefits for the utility and all customers. ICL recommends the
other most common method known as the "Utility Cost Test", which is the primary test used by
Utah and Texas to ensure utilities pursue least cost resources for customers. ICL supports the
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4 July 18,2018
UCT because is focuses on costs (incentives and administration) and benefits (avoided energy
and capacity) controlled by the utility. Further, although called "utility benefits" in fact this test
measures a customer benefit as utilities pass through their costs and benefits to consumers.
Meanwhile the Total Resource Cost Test layers on top of the UCT the incremental costs and
benefits to the program participant--something the utility has little control over and that have
unique values to each participant. These assumptions make the Total Resource Cost Test
complex, uncertain, and ultimately not accurate. In the words of the Idaho Commission, "'We
find the UCT more accurately assesses the value of energy efficiency as a resource. Moreover we
have previously approved using the UCT as the primary determinant of cost-effectiveness."
Order No. 33766 at 5, Order No. 33769 at 9.
Despite these clear statements from the Commissionin2}lT,Idaho Power here cites
Order 33365, issued two years before, and states, "the Company remains committed to
evaluating program performance under all three metrics." Aschenbrenner at 20-21. The third
metric Idaho Power refers to is the Participant Cost Test, which measures the costs and benefits
specific to the customer participating in the program. ICL agrees that assessing effrciency
programs for a variety of perspectives is important - during program design. For example,
comparing the results can inform whether incentive levels should be adjusted to either reduce
costs for the utility, and improve the UCT result, or increase incentives to customers, and
improve the PCT result. But program design is a different issue from whether the program is a
cost effective resource for the utility to pursue. As the Commission clearly stated in2017, all
three perspectives have value, but "We find the UCT more accurately assess the value of energy
efficiency as a resource." Order No 33766 at 5.
IPC-E-18-03
ICL COMMENT
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Here, in determining the prudence of Idaho Power 2017 DSM investments, ICL
recommends the Commission provide clarity to all parties that the UCT is the threshold test to
assess the value of efficiency as a resource and that the Commission will look to the specific
activities to determine if Idaho Power acquired the resource in a prudent manner. This approach
aligns with the consideration of supply side resources and ensures the utility pursues the most
cost effective resource for customers.
Respectfully submitted this lgth day of July 2019,
Benjamin Otto
Idaho Conservation League
IPC-E-18-03
ICL COMMENT
6 July 18,2018
CERTIFICATE OF SERVICE
I hereby certifu that on this 19th day of June 2018,I delivered true and correct copies of
to the following persons via the method of service noted:the foregoing
Benjamin J. Otto
Hand delivery:
Diane Hanian
Commission Secretary
Idaho Public Utilities Commission
427 W. Washington St.
Boise, ID 83702-5983
(Original and seven copies provided)
Electronic Mail:
Idaho Power
Iulia A. Hilton
Connie Aschenbrenner
Regulatory Dockets
Idaho Power Company
P.O. Box 70
Boise,Idaho 83707
[e-mail]
caschenbrenner@idahopower. com
dockets@idahopower. com
Idaho lrrigation Pumpers Association
Eric L. Olsen
ECHOHAWK & OLSEN, PLLC
505 Preshing Ave., Suite 100
P.O. Box 6119
Pocatello,Idaho 83205
[e-mail]
Anthony Yankel
12700 Blake Avenue, Unit 2505
Lakewood, Ohio 44107
[e-mail]
IPC-E-18-03
Certificate of Service
Industrial Customers of ldaho Power
c/o Peter J. Richardson
Richardson Adams, PLLC
515 N. z7thst
P.O. Box 7218 Boise,Idaho 83702
peter@richardsonadams. com
Dr. Don Reading
6070 Hill Road Boise, Idaho 83703
dreading@mindspring. com
July 18,2018