20200406Notice_of_Application_Order_No_34620.pdf

NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO. 34620 1

Office of the Secretary
Service Date
April 6, 2020
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF IDAHO POWER
COMPANY’S APPLICATION FOR A
DETERMINATION OF 2019 DEMAND-
SIDE MANAGEMENT EXPENSES AS
PRUDENTLY INCURRED
)
)
)
)
)
)
)
)
)
CASE NO. IPC-E-20-15

NOTICE OF APPLICATION

NOTICE OF
INTERVENTION DEADLINE

ORDER NO. 34620

On March 13, 2020, Idaho Power Company (“Company”) applied to the
Commission for an order finding that the Company’s demand-side management (“DSM”)
expenses for 2019 were prudently incurred. The Company requests the Commission find
the Company prudently incurred $45,079,479 in deferred costs for 19 DSM programs,
which included $38,083,244 in Idaho Energy Efficiency Rider expenses, and $6,996,236
in demand response program incentives. The Application summarizes the Company’s 2019
DSM program performance, expenses, adjustments, cost-effectiveness, evaluations of the
program, and input from stakeholders.
“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
opportunity to recover its DSM expenses through rates if the Commission finds the
Company prudently incurred those expenses. 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.
The Company also requests authorization to eliminate the reporting requirement for
the annual Flex Peak Program. The Company requests its Application be processed via
Modified Procedure.
NOTICE OF APPLICATION
YOU ARE HEREBY NOTIFIED that the Company states its 2019 DSM efforts
included Northwest Energy Efficiency Alliance (“NEEA”) market transformation
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO. 34620 2
activities, energy efficiency programs, demand response programs, and several educational
initiatives. Application at 2-4. The Company states it achieved 203,041 megawatt hours
(“MWh”) of incremental annual energy efficiency savings on a system-wide basis in 2019.
Id. at 4. The Company noted its energy efficiency programs saved 184,933 MWh1 ,
including 40,380 MWh from the residential sector, 134,435 MWh from the
commercial/industrial sector, and 10,118 MWh from the irrigation sector. Id. Additionally,
the Company achieved 18,108 MWh of energy efficiency market transformation savings
through NEEA initiatives. Id.
YOU ARE FURTHER NOTIFIED that the Company funds its energy
efficiency and demand response programs through the Idaho Energy Efficiency Rider
collected in customers’ base rates. Id. at 5. The Company tracks payments through the
annual Power Cost Adjustment. Id. With this Application, the Company asks the
Commission to find that the Company prudently incurred $45,584,696 in system-wide
expenditures related to its DSM programs in 2019. Id. The Company states these expenses
include $38,083,244 in Idaho Energy Efficiency Rider expenses and $6,996,236 in demand
response program incentive payments. Id. In 2019, the Company made an accounting
adjustment of $13,264 relating to Oregon Multifamily Energy Savings Program that was
inadvertently charged to the Idaho Energy Efficiency Rider. Id. The Company made a
correcting accounting entry in 2019 to move the charges to the Oregon Energy Efficiency
Rider and credit the Idaho Energy Efficiency Rider. Id. at 5-6.
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 2019.
Id. at 6. The DSM Report discusses the cost-effectiveness of the Company’s DSM
programs and energy efficiency programs. Id. In support of its Application, the Company
submitted the prefiled testimony and exhibits of Pawel Goralski, its annual DSM Report,
and the results of its cost-effectiveness analysis. Id. 3, 6.
YOU ARE FURTHER NOTIFIED that the Company explains it determined
the cost-effectiveness of its energy efficiency programs using three tests: (1) the total
resource cost test (“TRC”); (2) the utility cost test (“UCT”); and (3) the participant cost

1 The savings from Idaho Power’s energy efficiency programs in 2019, excluding the NEEA savings, represented a
17% increase over 2018 savings.
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO. 34620 3
test (“PCT”).2 Id. at 6. The Company reports that its overall energy efficiency portfolio was
cost-effective in 2019, passing the TRC, UCT, and PCT, with ratios of 2.72, 2.12, and 2.79
respectively. Id. Of the Company’s 16 Idaho energy efficiency programs, 11 programs
passed the TRC and UCT. Goralski Direct Testimony at 17, Table 3. Further, all energy
efficiency programs with customer costs passed the PCT. Goralski Direct Testimony
Exhibit No. 2. Five programs were not cost-effective under either the TRC or UCT, or
both. The Company intends to continue to work towards greater cost-effectiveness for the
Weatherization Assistance for Qualified Customers Program, Weatherization Solutions for
Eligible Customers Program, Energy House Calls, Residential New Construction Pilot
Program, and the Heating and Cooling Efficiency Program, because they offer benefits that
are difficult to quantify. Goralski Direct Testimony at 20-25; Application at 7-8.
YOU ARE FURTHER NOTIFIED that as directed in Order No. 34469, the
Company will begin using the UCT as the primary test for evaluating energy efficiency
cost-effectiveness in the 2021 Integrated Resource Plan (“IRP”). Id. at 6. These changes
will be carried out over the 2020 program year to synchronize with the Company’s annual
planning cycle. Id.
YOU ARE FURTHER NOTIFIED that the Company did not calculate a
benefit/cost ratio when assessing the cost-effectiveness of its demand response programs.
Application at 8. Rather, the Company determined those programs’ cost-effectiveness
based on the $16.7 million demand response portfolio value specified in Commission Order
No. 32923. The system-wide operating cost for the Company’s three demand response
programs was $8.3 million, of which $7.8 can be attributed to the Idaho-only jurisdiction.
Id. The Company estimates the three demand response programs would have cost
approximately $11.5 million on a system-wide basis had the programs been dispatched for
the full 60 hours permitted by Order No. 32923. The costs are less than the value of the
demand, calculated in the 2017 IRP to be $19.8 million. Id.

2 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. It demonstrates the full incremental cost of
the measure to both participants and the utility in the service territory as a whole. The UCT compares program
administrator costs to supply-side resource costs, assessing costs and benefits to the utility and its ratepayers. 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. The Company cannot use the PCT for programs with no customer costs.

NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO. 34620 4
YOU ARE FURTHER NOTIFIED that the Company states independent, third-
party consultants provide impact and process evaluations to verify that program
specifications were met, recommend improvements, and validate program-related energy
savings. Id. at 9. In 2019, third-party consultants provided two combined program impact
and process evaluations, two program option impact evaluations, two program summary
analyses, a savings estimate analysis, and a demand reduction analysis. Id.
YOU ARE FURTHER NOTIFIED that the Company proposes to eliminate the
Flex Peak reporting requirements required by Order No. 33292. Id. at 10. The Company
states that the reporting requirement could be streamlined if eliminated because the
Company already provides the required information for the Flex Peak Program in
Supplement 2 in its DSM Annual Report. Id.
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 “ELECTRIC” tab at the top of the page, then click on
“Open Cases,” and then click on the case number as shown on the front of this document.
YOU ARE FURTHER NOTIFIED that all proceedings in this case will be held
pursuant to the Commission's jurisdiction under Title 61 of the Idaho Code. The
Commission may enter any final order consistent with its authority under Title 61.
YOU ARE FURTHER NOTIFIED that all proceedings in this matter will be
conducted pursuant to the Commission’s Rules of Procedure, IDAPA 31.01.01.000 et seq.
NOTICE OF INTERVENTION DEADLINE
YOU ARE FURTHER NOTIFIED that persons desiring to intervene 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.
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO. 34620 5
YOU ARE FURTHER NOTIFIED that after the intervention deadline runs, the
Commission Secretary shall issue a Notice of Parties. Staff then will informally confer with
the parties about scheduling for this case.
O R D E R
IT IS HEREBY ORDERED that persons desiring to intervene 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 after the Commission Secretary issues a
Notice of Parties, Staff will informally confer with the parties about an appropriate
schedule.
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this
6th day of April 2020.

____________________________________
PAUL KJELLANDER, PRESIDENT

____________________________________
KRISTINE RAPER, COMMISSIONER

____________________________________
ERIC ANDERSON, COMMISSIONER

ATTEST:

_________________________________
Diane M. Hanian
Commission Secretary

I:\Legal\ELECTRIC\IPC-E-20-15\IPCE2015_Ntc App Int_dh.docx