20031211Application.pdf

RECEIVED
2003 December PM 3:31
IDAHO PUBLIC
UTILITIES COMMISSION
825 E. Multnomah
Portland, Oregon 97232
[phone]
PACIFICORP
Rl\CIFIC POWER UTAH F'OWER
December 5, 2003
Idaho Public Utilities Commission
472 West Washington
Boise, ill 83702-5983 -=P I'\-c - 0 3 -
Attention:Jean D. Jewell
Commission Secretary
Re: Advice No. 03-
Schedule 72 - Irrigation Load Control Credit Rider
Pacificorp (d.a. Utah Power & Light Company) hereby submits for electronic filing a copy of
the following proposed tariff changes associated with Tariff LP.C. No. 28 of Utah Power &
Light Company applicable to electric service in the State ofIdaho. The Company respectfully
requests an effective date of January 7, 2004.
Second Revised Sheet No. 72.
Third Revised Sheet No. 72.3
First Revised Sheet No. 72.4
Schedule 72
Schedule 72
Schedule 72
Irrigation Load Control Credit Rider
Irrigation Load Control Credit Rider
Irrigation Load Control Credit Rider
The proposed tariff changes reflect the proposed changes referenced in the Company
November 28, 2003 filing. (See Attachment A).
The requested effective date of January 7, 2004 would allow the Company sufficient time to
comply with the customer notification requirements based on the terms ofthe proposed tariff
changes, or based on the terms in the existing tariff. If the Commission elects not to approve
these proposed conditions with the January 7, 2004 effective date, the Company would consider
it an acceptable outcome to administer the Irrigation Load Control Credit Rider program for the
2004 irrigation season based on the existing conditions of Schedule No. 72.
Pcoud Span,o, of me
200212004 US. Olympic Team
Advice No. 03-
PacifiCorp
December 5, 2003
Page 2
The Company will submit a separate compliance filing including the Load Control Service
Credit amounts for the 2004 irrigation season. The credit amounts will be calculated based on
the same methodology used to determine the 2003 Load Control Service Credit amounts.
It is respectfully requested that all formal correspondence and Staff requests regarding
this material be addressed to:
By E-mail (preferred):datarequestUfuJacifi corp. com
By Fax:[phone]
By regular mail:Data Request Response Center
PacifiCorp
825 NE Multnomah St., Suite 800
Portland, OR 97232
Informational questions should be directed to Bob Lively, Manager, Regulation, [phone].
Sincerely,
e~/~~ !
1Jif
Vice President, Regulation
Enclosures
utahAir..
C. No. 28
Second Revision of Sheet No. 72.
Canceling First Revision of Sheet No 72.
ELECTRIC SERVICE SCHEDULE NO 72 - ContinuedSCHEDULE: (C)
Notification of Credit: The Company will determine the Fixed Monthly Participation Credit and
the kWh Credit and shall provide notification of the LCSC to Schedule 10 customers by January 15th ofeach calendar year. (C)
Load Control Service Agreement: ConcUITent with the Notification of Credit referenced above
the Company will provide a Load Control Service Agreement (LCSA) listing the amO1mt of credit the
customer will receive during the irrigation season if they elect to participate in the program. Customers
desiring to participate in this load control program shall sign the LCSA and return it to the Company by
February 15th of each calendar year to indicate their intent to participate.
Notification of Load Control Schedule: The Company will provide the participating Customers the
scheduled hours for load control during the Irrigation Season by March 15th of each calendar year. Subject
to the limitations described in the Load Control Conditions below, the Company shall have the right to
establish at its sole discretion the scheduled load control hours for each participating customer, based on
what the Company deems most beneficial to its operations. The scheduled load control hours shall be fixed
through the Irrigation Season. Following the Notification of Load Control, customers may notify the
Company of their intent to terminate from the program, without penalty until April 15th of each calendar
year. Customers notifying the Company of their intent to terminate from participation in the program after
April 15th shall be subject to the terms of Special Condition No., Early Termination.
LOAD CONTROL CONDITIONS: The Company shall have the right to implement a load
control event for participating customers during the hours 2PM to 8PM Mountain Daylight Savings Time.
Duration of the load control event can be no more than six (6) continuous hours. Allowable days for load
control shall be each Monday through Saturday. No more than two (2) load control events per participating
customer per week shall be allowed. Maximum number of hours of load control per participating customer
is twelve (12) hours per week. No more than one load.control event per participating customer may occur in
one day.
(Continued)
Submitted Under Advice Letter No. 03-
ISSUED: December 5,2003 EFFECTIVE: January 7, 2004
(N)
(N)
(0)
(C)
(C)
(D)
utahAir"
C. No. 28
Third Revision of Sheet No. 72.
Canceling Second Revision of Sheet No. 72.
ELECTRIC SERVICE SCHEDULE NO 72 - Continued
LOAD CONTROL SERVICE AGREEMENT: The Customer and Company will execute an
agreement for irrigation load control participation. The agreement shall specify the Load Control kW
amount that the customer shall curtail during a load control event. The agreement shall also specify the cost
of timers or other load control devices required to achieve scheduled load control events that the customer
will pay subject to the terms of Special Condition 8, Cost of Control Devices. The agreement will also
include typical costs that the customer may incur for early termination. Participating customers shall sign a
written agreement for a term of one year. Except as provided in this Schedule, termination of the agreement
may only occur on the annual expiration date of the agreement. Participating customers are required to
execute a Load Control Service Agreement annually.
(C)
(C)
SPECIAL CONDmONS:
1. Metering. The Customer must have a meter provided by the Company, which is capable of
recording usage intervals no less than 15 minutes.
2. Specified Load Control kW. The Load Control kW amount for each month of the Irrigation
Season shall be the average of the past three (3) years (or as available history) kW demand for
each month for the specific pump installation.
3. Outages. Uncontrolled outages or other types of interruptions do not qualify for payment under
this tariff.
4. Liability. The Company is not responsible for any consequences to the participating Customer
that result from a Load Control Event or the failure of load control equipment.
5. Load Shifting.Customers participating in this program may not shift irrigation load to other
facilities served by the Company or purchase replacement production from another facility
served by the Company. PacifiCorp reserves the right to determine if the participating customer
is in violation of Special Condition 5, Load Shifting. Violation of Special Condition No.5 shall
result in Early Termination under the terms of Special Condition No., forfeiture of the Load
Control Service Credit for the current month, and removal from the program for the remainder
of the hrigation Season.
6. Failure to futerrupt During a Load Control Event.A Customer must participate in each
scheduled load control event during the irrigation season, except to the extent unable to due to
mechanical failure or malfunction of the load control device. PacifiCorp reserves the right to
(Continued)
Submitted Under Advice Letter No. 03-
ISSUED: December 5, 2003 EFFECTIVE: January 7 2004
utahAir..,
C. No. 28 First Revision of Sheet No. 72.4
Canceling Original Sheet No 72.4
ELECTRIC SERVICE SCHEDULE NO 72 - Continued
SPECIAL CONDITIONS: (Continued)
determine if load control devices were intentionally damaged to limit load control. Violation of
Special Condition No.6 shall result in Early Termination under the terms of Special Condition
No.7, forfeiture of the Load Control Service Credit for the current month, and removal from the
program for the remainder of the Irrigation Season.
7. Early Termination. If the Customer is terminated from this program the Customer shall be
responsible for reimbursing the Company for costs associated with participation in the program.
Such costs include, but are not limited to, direct and indirect labor costs associated with
enrolling the Customer in the program, investigating intentional damage to load control devices
removing the customer from the program, and will not include costs for replacement power.
Customers required to pay costs associated with early termination under terms of this Special
Condition will be provided a statement detailing such costs.
8. Cost of Control Devices.The participating Customer shall pay the cost of timers or other load
control devices and associated installation. Such costs include, but are not limited to, direct and
indirect costs of load control devices, labor, and material and equipment required to achieve
scheduled load control events. The participating Customer shall pay such cost only to the
extent that they exceed one thousand dollars per meter. Customers required to pay the cost
control devices under terms of this Special Condition will be provided a statement detailing
such costs.
9. Free Riders.Customers may not participate in this program with accounts and meters that
would not have used power during the Irrigation Season irrespective of participation in the
program. PacifiCorp reserves the right to determine if the participating customer is in violation
of Special Condition 9, Free Riders. Violation of Special Condition No.9 shall result in Early
Termination under the terms of Special Condition No.7, forfeiture of the Load Control Service
Credit for the current month, and removal from the program for the remainder of the Irrigation
Season.
ELECTRIC SERVICE REGULATIONS: Service under this Schedule will be in accordance with
the terms of the Electric Service Agreement between the Customer and the Company. The Electric Service
Regulations of the Company on file with and approved by the Idaho Public Utilities Commission, including
future applicable amendments, will be considered as forming a part of and incorporated in said Agreement.
(Continued)
Submitted Under Advice Letter No. 03-
ISSUED: December 5, 2003 EFFECTIVE: January 7, 2004
(C)
(C)
(C)
(C)
(C)
(C)
ATTACHMENT A
PacifiCorp November 28 , 2003
Filing
825 ' Multnomah
Portland, Oregon 97232
[phone]
PACIFICORP
IW:IFIC . POWER UTAH POWER
November 28 2003
Idaho Public Utilities Commission
472 West Washington
Boise, ill 83702-5983
Attention:Jean D. Jewell
Commissic;m Secretary
Idaho 2003 Irrigation Load Control Credit Rider Program Impact Evaluation
Report
Re:
Pacificorp (d.a. Utah Power & Light CompfU1Y) hereby submits an original arid eight copies of
the Idaho 2003 Irrigation Load Control Credit Rider Program Impact Evaluation Report.
The purpose of this filing is to comply with Commission Order No. 29209 where in the
Company was directed to submit a report at the end of the 2003 irrigation season sUmmarizing
the results of Irrigation Load Control Credit Rider program (program). The required Program
evaluation is provided herein as Attachment A.
Also in compliance with Commission Order No. 29209 the Company recommends the following
changes toim'prove the program. The intent of these recommendations is twofold: (1)
streamline the enrolhnent process and (2) mitigate potential customer concerns that may have
limited customer participation in the 2003 Program.
The Company proposes to:
1. Provide customers with a Load Control Service Agreement by January 15th of each year
together with the Load Control Service Credit notification (the credit the customer would
receive should they elect to participate). The Load Control Service Agreement will
include the amount of credit the customer would receive during the upcoming irrigation
season if participation is elected.
2. Require that customers sign and return the Load Control Service Agreement by February
15th of each year to indicate their intention to participate in the Program.
3. . Notify participating customers of the scheduled hours for load control during the
irrigation season by March 15th of each calendar year.
4. Pennit participating customers to notify the Company of their intent to opt out of the
Program without penalty by April 15th. Under the Company proposal customers
9))
cmud Spon,o, of th,
20021200' U~. O~mp;cT"m
Noveniber 28, 2003
Idaho 2003 Irrigation Load Control Report
PacifiCorp
Page 2 of2
notifying the Company of their intent to opt out of the Program after April 15th shall. be .
subject to the terms of Special Condition No.7, Early Termination (Schedule No. 72).
5. Not enforce the ineligibility for the 2004 irrigation season for customers who submitted
an Intent to Participate Notification in the in 2003 Program but subsequently failed to
execute a Load Control Service Agreement. This proposal is based on the Company
recommendation to eliminate the Intent to Participate Notification as part of the 2004Program. .
6. To limit the potential cost for participating customers under tenns of Special Condition
No 8 , Cost of Load Control Devices (Schedule No. 72) to such costs only to the extent
that they exceed one thousand dollars.
The Company will separately file tariff changes reflecting these recommendations together with
the Load Control Service Credit for the 2004 irrigation season.
It is respectfully requested that all formal colTespondence and staff requests regarding this matter
be addressed to :
By E-mail (prefelTed):datarequest~pacifi com. com
By Fax:[phone]
By regular mail:Data Request Response Center
PacifiCorp
825NEMultnomah St., Suite 800
Portland, OR 97232
Informal questions should be directed to Bob Lively [phone].
Sincerely,
L~",--/ i?1-.
Doug IJarson
Vice President, Regulation
Enclosures
ATTACHMENT A
IDAHO 2003 IRRIGATION LOAD
CONTROL CREDIT RIDER
PROGRAM IMPACT EVALUATION
REPORT
NOVEMBER 2003
Final Report
Idaho 2003 Irrigation
Load Control Credit
Rider Program Impact
Evaluation
Submitted to:
PacifiCorp
Prepared by:
Allen Lee, Ph.
Brian Hedman
Collin Elliot
Quantec, LLC
November 2003
Table of Contents
ntrod uction .
... ..........
~........................... ........ ..... ......... ........ 1-
Background
' ........ ................. ........... ...... """"'" .............. ..". .......
..... ........ 1-1 '
Response to the Idaho Public Utilities Commission Staff
Recommendations .... ......
.'... ................... ......... .................... .........
;...... ..... 1-
Overview of Evaluation Approach.................................................:........ 1-
II.Data and Assumptions .............
..........................
.............. 11-
Energy Data and Ben,efits Valuation .....
.'......................................!.........
ll-
Costs,
... ...... ....... """'" """""" ........... .... """"""""""""
........ .......... """'" ll-
III. Cost-Effectiveness Analysis........................................... 111-
Cost-Effectiveness Analysis.................................................................1II-
Inputs ...................................:................................................................ I11-
Results ........... .... ....... ............ ................... ........... .... ........... ................... Ill- 3
. auantec
Evaluation of the Idaho Irrigation Load Control Credit Program
introduction
Backg rou nd
Pursuant to the Company s commitment and Commission Order No. 29034,
PacifiCorp agreed to work with irrigators to develop an optional load control
program beginning with the 2003-irrigation season. In December 2002 and
January 2003 the Company met with representatives of the Idaho Irrigation
Pumpers Association and the, irrigation customer class to explain the
Company s proposed program and to solicit comments and suggestions from
the impacted customers. Based on feedback from customers, PacifiCorp filed
its proposed Irrigation Load Control Credit Rider Program (program) on
January 31, 2003. On March 17,2003, the Idaho Commission approved the
PacifiCorp Program for implementation beginning with the 2003 irrigation
season.
Response to the Idaho Public Utilities Commission Staff
Recommendations
In March 2003 the Idaho Public Utilities Commission issued Order No.
29209. The order included IPUC Staff recommendations for PacifiCorp to .
prepare a report as follows:
...
prepare a detailed report on the program and file it with the
Commission. The filing should be made no later than
December 1,2003 and should contain the number of irrigation
customers who 1) were eligible to participate in the program,
2) filed a letter of intent to participate, 3) entered into a load
control service agreement, 4) participated in the programfor
the full three and one-half months and 5) those not eligible to
participate next year. The report should also include the total
dollar amount of credits provided under the program identified
by month. The filing should further include any proposed
changes or recommendations to improve the program.
(Order No. 29209, page
. auantec
Evaluation of the Idaho Irrigation Load Control Credit Program 1-1
Commission Findings in Order No. 29209 directed the Company to:
...
submit a report aNhe end of the 'irrigation season
summarizing its results. The report once filed will be noticed
for comment and we anticipate thflt recommendations for
program changes will result in an improved program for the
2004 irrigation season. lOrder No. 29209, page
The following information responds to the aforementioned IPUC Staff
recommendations. Table 1.2 provide~ the data requested regarding customer
participation.
Table 1.2: Number of Irrigation Customers by Category
f""'7",
--.
ttisiom'etCateg6iy"'7?"-"Jr7'T" "
.""~" """ ."
Numl)er".
,..",.,.
..n
Were eligible to participate in the program 015 accounts /4,466 individually metered
sites
Filed a letter of intent to participate 915
Entered into a load control service agreement 207 different customers /403 individually
metered sites
Participated in the program for the full three 207 customers / 402 sites
and OIie-half months
Were not el~gible to participate next year 708
The total dollar amount of credits provided under the program, identified by
month, are summarized in Table 1.3. Additionally, Table 1.4 shows the actual
avoided demand by month and control period.
Table 1.3: 2003 Avoided Demand and
Participation Credit (LCSC)
r?'
?~"-
~Kion
~?,
~..;7
JCl \:~~1i
~~~s
~=-fr'
June $60,971,
July $93,539.
August $97 749.45
September $25,323.
Total participation credit $277 ,583.
Note: Avoided demand (kW) shown should be divided by two to
derive the effective average control-day avoided demand. This is because
each irrigator was controlled only tWo of the four possible control days.
Actual avoided demand by control day is presented in Table 1.4
quantec
Evaluation of the Idaho Irrigation Load Control Credit Program
Data and Assumptions
Energy Data and Benefits Valuation
PacifiCorp provided the data used in this evaluation. For this Program,
Quantec saw no need to collect energy impact data independently for the
following reasons:
. The design of the Program was straightforward-participating pumps were
. required to be off for the full period during control days
. PacifiCorp had good documentation on which pumps were participating
and their power rating
. PacifiCorp did measure loads on specific circuits and substations and the
results clearly demonstrated dramatic power drops during the control
periods
Random inspections conducted at about 8% of the participating sites found
that the equipment was performing flawlessly and that only 3% (1 of 32)
of the participants had done anything to override the control system.
Figure n.I demonstrates the impact of the Program on the irrigation daily load
shape. These SCADA data are from the /IDAHO/BGRASY transmission
substation (CB #67) and show measured loads recorded during selected days.
This substation was selected because it had a substantial number of Program
participants (participants represented 29% of this circuit's load). The graph
shows the loads averaged for the control days Monday/Wednesd~yand
Tuesdayffhursday and for Friday, a non-control day. Although the load shape
and magnitudes vary by day, the impact of the Program is clearly shown as a .
significant and sharp load drop during the control hours.2 This figure
although not conclusive, is consistent with the expected impact of the Program
on demand during the control period.
The participant had not intentionally tried to violate the system control but had damaged
it during an emergency situation. .
The actual levels of demand displayed for the different days should be considered only
illustrative since the data represent only five days out of the entire irrigation season. The
levels are likely to be influenced by exogenous and short-term variables such as weather,
non-irrigation loads, and agricultural practices. A more accurate display of relative usage
magnitudes would require longer-term measurements.
. auantec
Evaluation of the Idaho Irrigation Load Control Credit Program 11-
Table 1.4: 2003 Actual A vy,ided Demand Realized by Control Period
""c '_C ,"c,,
..""
_C""'c,,-,
;,,"',.._"'-""",,-"-~,,-"'---",,'_.----_..."""".."":""'
n ,. "n
"" ..."
Control Period ; JtmeAvoided'July A\'oided AugustAvoided "' SeptemberA\'oided
..'" "" "
kW'kW..
? ,
kW
" "" ,
Monday Wednesday 533.23,782.22,861.67 20,976.
Tuesday Thursday 19,012.21,881.00 20,643.297.
Mean Avoided kW 19,772.84 22,831.21,752.19,636.
Total Avoided kW 39,545.45,663.505.273.
Overview of Evaluation Approach
Quantc::c s impact evaluation estimated the benefits and costs of this ProgrfUIl
and used them as'inputs to th~ cost-effectiveness analysis. Cost effectiveness
was assessed based on the benefit/cost ratio calculated from alternative
perspectives.
PacifiCorp provided measured and calculated energy impact. data for the
analysis. It also provided detailed Program cost data. Quantec used its
Demand hnpact Cost Effectiveness (DICE) model to calculate the stream of'
Program benefits and costs during the expected life of the Program and
, calculated present discounted values. These values were then used to derive
the benefit/cost ratios. Quantec has used this model and approach to evaluate
numerous utility programs in the past.
. auantec
Evaluation of the Idaho Irrigation Load Control Credit Program
Figure 11.1: Load Shapes for Control and Non-control Days
:1E 30
I Control Period
0 0 0 0 0 0 0 0 0 0 0 0 0 0 00 0 0 O
~ ~
o 00 ~ 00 ~ ID ~ ~ M 'N ~ 0 ~ ro ~ ID ~ ~ M N
~ ~~ ~~ ~~ ~
~ o0 ~ N M ~ ID ~ ~ 0 ~ M ~ ~ ~ 00 ~ ~ N M
~ ~ ~ ~ ~ ~ ~ ~ ~ ~. ~
TIme of Day
- Mon-Wed Control Average Tue- Thu Control Average Non-control
To assess the costs and benefits associated with the clear demand response of
participating customers, it is necessary to understand how the Program
, influenced participants' overall irrigation behavior. To provide this
information, PacifiCorp s irrigation expert obtained feedback from
participating customers. PacifiCorp found that, in addition to reducing demand
during the control periods, Program participants were not making up for the
foregone irrigation by increasing irrigation in non-control periods. The
behaviors of irrigators that allowed them to reduce total irrigation on
participating fields included the following:
Irrigators were able to enroll locations that they believed could tolerate
the measurable amount of water that will be avoided as a function of the
imposed control schedule. This decision is a function of the soil type, the
system used to deliver the water (e., circle irrigation, line irrigation
etc.), the growing season, and forecasted climatic conditions (rainfall
temperature, Cooling Degree Days, relative humidity, etc.
).
Irrigators have the option to manipulate the crop rotation pattern such that
drought resistant crops can be synched to pumps and irrigation systems
nominated for participation in the Program. Crops such as hay, grain;
peas, and corn would typically be good candidates for Program inclusion.
Quanfec
Evaluation of the Idaho Irrigation Load Control Credit Program 11-
In1g,,:tors were able to ropke a busin~ss decision taking into account their
risk preferences, given \heir anticipated "strike price" for a particular
commOdity. Irrigators were able to choose whether to participate given.
the certainty of the Program curtailment credit and their perception of
market conditions and theit risk assessment.
This finding had a direct implication on the impact analysis. Although the
Program was implemented primarily as a way to reduce demand during peak
periods, it also resulted in energy savings. Because the aggregate demand
reduction (on the order of in MW per control day) was relatively small
compared to total system demand and incremental additions of this magnitude
to a utility s generation resource mix are unlikely, it was impractical to
estimate its benefits in terms of avoided demand alone; Instead, PaciflCorp
calculated the value of energy savings using the Integrated Resource Planning
(IRP) Decrement approach for valuing Demand Side Management (DSM)
programs. FundaIpentally, the IRP Model calculates revenue requirements
based on a given set of assumptions, including an hourly load forecast.
Decrements (subtractions) to the load forecast are made based on the hourly
shape of the DSM program modeled. Values are calculated with and without
the Program. The difference, or decrement value, represents the most
PacifiCorp would pay to avoid the load being modeled. The resulting values
for avoided energy ($lMWh) based on the anticipated load shape of this
Program are presented in Tablell.
Table 11.1: Estimated Value of Energy Savings
:'-
C"-"
:'-'-'-~~"--"---:'-""-""-'-'-"..,
i..
..".y ...,, "
ValueofEuergyeft
! ,, " "" ' '
: Saved ($INIWh)
2003 $57.
2004 $57,
2005 $59.
2006 $60.
2007 $62.
To estimate the energy and demand savings, PacifiCorp used the
characteristics of the participating customers ' loads. In 2003 , there were 207
participants with a total of 403 independent participating sites. From its
participant contracts and three-year average historical data, PacifiCorp knew
the average historical demand of each site during each month. The total
demand reduction for each control period (MonlWed and Tueffhu) was
estimated by customer and aggregated to calculate the total load reduction
induced by the Program. Table 11.2 presents the calculated demand reductions
by period.
. auaotec
Evaluation of the Idaho Irrigation Load Control Credit Program 11-
Table 11.2: A voided 2003 Aggregate Demand by Control Period
Note: In 2004 and subsequent Program years, the July estimated avoided demand for the MonfWed period is
489 kW and for the TuefI1tu period it is 21 960 kW. In 2003, the values are slightly lower because several
participants did not participate for the full month.
, The avoided energy economic benefits of the 2003 Program were calculated
on a monthly basis using the following formula:
Energy Economic Benefits
lNo. ofMonlWed Control Days Mon/Wed Control Days Avoided Demand
No. ofTue/Thu Control Days Tueffhu Control Days Avoided Demand)
Value of Energy Savings
The values of energy savings are shown in Table n.! for each year. For future
years, these benefits are calculated using the same formula, but with the value
of energy savings for the appropriate year.
For purposes of estimating future benefits and costs, we used PacifiCorp
, evaluation assumption that the Program will continue for the five-year period
2003-2007. This assumption is used for evaluation purposes only. It is
expected that the Program will continue indefinitely. PacifiCorp assumed that
the same number of customers and sites would participate each year. Although
participation was assumed to be constant, PacifiCorp s planning assumptions
included the likelihood that some customers would drop out each year, but
that others would be recruited to take their place. Given the strong response to
the Program this year, Quantec believes that it is very reasonable to assume
that participants who drop out can be replaced easily in future years. Future
recruitment costs are discussed in the following section.
The economic benefits to Program participants include reduced utility bills
and the PacifiCorp participation credit. Given that the participants respond to
the Program by reducing their total energy consumption, Quantec calculated
the utility bill savings by multiplying the marginal electricity rate for the
average irrigator times the total energy savings for all participants. The
average irrigator consumes 43 000 kWh/month, and the applicable rate for this
level of consumption is $0.048/kWh. 3
The participation credit benefit to participants is discussed in the next section
as it is treated as a Program cost from the utility s perspective.
Utah Power estimated this consumption level based on an assumption of a 100 hp pump
motor, with a 75% load factor, operating 18 hours per day for a 30-day month.
ouantec
Evaluation of the Idaho Irrigation Load Control Credit Program 11-
Since the Program does not ~ffect customers' peak demand on non-control
days~ we have assumed the ~rogram does not reduce the participants' monthly
. peak demand. Consequently; no participant economic benefits were attributed
to reductions in charges (power rate) based on maximum demand.
Costs
PacifiCorp provided a breakdown of 2003 Program year costs and forecasts of,
future-year costs. We used both the 2003 cost data and projections for'future
years in oui analysis~
Table II.3 summarizes the costs provided by,PacifiCorp. The values for 2003
are actual costs. All values are reported in current dollars and all costs except
field expenses and interruption credits are assumed to escalate at a r~te of 3%
per year. ' .
Table II. 3: Program Costs
...;""
..7"20iLf"Jr:T21)64'-'r'-"zoos-2006"
. :'
.2007'
.' .
Administrative support $9,613 . $9,902 $10 199 $10,505 $10,820
Evaluation 135 $2,199 265 $2,333 $2,403
Filed Expenses $250,223 $85,000 $90,000 $95,000 $100,000
Participation credits $277,584 $277,584 $277 ,584 $277,584 $277,584
Program management $10 993 $11,323 $11,662 $12,012 $12,373
Reporting $352 $362 $373 $384 $396
Total Program costs $550 900 $386 370 $392 084 $397,819 $403,576
Field expenses reflect potential costs for maintaining field equipment and
recruiting new participants to replace any who drop out. Given the experience
during the fIrst Program year, Quantum believes that the estimates are
conservative and that the actual fIeld expense costs are likely to be less than
those assumed by PacifiCorp.
The participation credit costs are constant for each year since the number of
participants is assumed to be unchanged and, and the level of future credits is
unknown. These credits are treated as a cost from the utility perspective. From
the perspective of the participants, however, they are benefits.
The customers were not charged for costs of participating in this Program.
Consequently, all Program costs are associated with expenditures byPacifiCorp.
. auantec
Evaluation of the Idaho Irrigation Load Control Credit Program 11-
III.Cost-Effectiveness Analysis
Cost-Effectiveness Analysis
Cost effectiveness was calculated using Quantec s DICE model. Procedurally,
the model takes the first year kWh savings and allocates them over all the
760 hours in a year based on load shapes appropriate for each of end use
being analyzed. The achieved hourly kWh savings are then multiplied "by the
appropriate avoided cost bas~d on the time of day and season during which
they occur (summer peak, summer off-peak, winter peak, etc.). The value of
the savings is calculated for each year of the measure life and then discounted
back to the present.
As part of this evaluation, Quantec conducted an analysis of the Program costs"
and benefits from the following perspectives:
1. Program Participants: For participants, Program benefits include
bill reductions and the participation credit payments participants
received for demand reduction.
PacifiCorp: From PacifiCorp s perspective, the benefits are in the
fonD of reduced generation or power purchase costs. The costs
include marketing and administration associated with funding the
Program, as well as the equipment and installation expenses and
participant credits.
Ratepayers: All ratepayers (participants and non-participants) may
experience an increase in rates to recover lost revenue, if any. This
test (refeITed to as the Ratepayer hnpact Measure Test, or RIM)
includes all PacifiCorp Program costs plus lost revenues. On the
benefits side, this test includes all reduced generation or power
purchase costs.
Total Resource Cost Test (TRC): This test examines the Program
benefits and costs from the perspective of the utility and its"
customers combined. On the benefit side, it includes reduced
generation or power purchase costs. On the cost side, it includes
costs incuITed by both the utility and by the participants, but
participant credits are excluded because they are transfer payments
among customers.
Table III. 1 summarizes the various components of the four tests.
. auantec
Evaluation of the Idaho Irrigation Load Control Credit Program 111-
Table HI.
, ',
Benefits and Costs of V ari~us Tests for This Program
L--'Tes :r-'7:--Be~1~fifrC-
" "" "': '" '
" .'" c()sis""
.:,,,'." ,' -
Participant Value of bill savings from None to participants
reduced consutTIption and
participants' credit payments
for demand reduction
PacifiCorp Value of avoided energy costs Program administrative,
as calculated by PacifiCorp marketing, and equipment costs,
IRP model and participant credits
RIM Value of avoided energy costs Program administrative
as calculated by PacifiCorp marketing, and equipment costs;
IRP model participant credits; lost revenues
TRC Value of avoided energy costs Program administrative,
as calculated by PacifiCorp marketing, and equipment costs
IRP model
Inputs
As noted earlier, PacifiCorp provided the inputs Quantec used in the cost-
effectiveness analysis. Quantec thoroughly reviewed these inputs and the
assumptions behind them. All costs and benefits' were provided in nominal
terms (i., without eliminating the effect of inflation).
kWh Savings. Estimated energy savings in 2003 were 7,917,839 kWh
annually. These savings were derived from the monthly demand reduction
during each of the control periods (MonlWed and TuefThu), times the number
of days in each control period each month, times six hours for each control
period each day. In future years, the estimated annual energy savings are
964 999 kWh. This value is higher than the 2003 figure because, as noted
before, several participants did not participate during the full month of July
2003. The monthly demand reductions in each control period were shown in
Table U.2; the demand reduction summed over the Program months and
control periods was 167 987 kW in 2003. In 2004 and subsequent years, this
estimated value will be higher-168 773 kW-for the same reason that the
energy savings will be higher, as discussed above.
Life. The Program impacts were calculated over the five-year evaluation term
of the Program. In addition to an analysis over the Program evaluation term
we conducted an analysis for the first year only.
Participant Retail Electricity Rate. An energy rate of $0.048 per kWh was
used, based onPacifiCorp s current tariff for irrigators and the average energy
use of irrigation customers.
quantec
Evaluation of the Idaho Irrigation Load Control Credit Program 111-2
Program Costs. The costs to the utility included administrative support,
evaluation, field expenses (equipment plus labor), participant inteITUption
credits, Program management, and reporting.
Avoided Costs. Cost effectiveness was calculated based on PacifiCorp
estimate of the value of energy savings, as described in Chapter ll. The effect
of line losses is included in the avoided cost and in .the calculation of benefits.
Discount Rates. To derive present discounted values, all future costs and
benefits were discounted using nominal discount rates. The rate used in the
TRC was 5.23% and the rate used in all other tests was 7.82%.
Results
Table III.2 summarizes the DICE model cost effectiveness outputs for the fust
year for the Program. The fIrst-year numbers are based on actual Program data
provided by PacifiCorp. The Program is cost effective in the fust year
(positive net present value and benefit/cost ratios exceeding 1.0) from the
Total Resource Cost perspective. From PacifiCorp s perspective (UTC), the
fust year of the Program is not cost effective because this is when most costs
are incurred. For participants (PART), the Program is cost effective in the fust
year, providing benefits of over $657 000 at no cost to the participants.
Table 111.2:
Cost Effectiveness - First-Year Only
l~Iif~
TRC 273 317 452,029 178,712
UTC 550,900 452 029 (98,871)
RIM 931,146 452,029 (479,117)
PART 657,830 657,830 NJA
Detailed Results
Benefits TRC UTC RIM PART
Avoided Costs 452,029 452,029 452 029
Bill Reduction 380 246
Incentive Payments 277,584
Total Benefits 452,029 452,029 452,029.657,830
Costs TRC UTC RIM PART
Program Administration 23,094 23,094 094
Participant Incentives 277,584. $277,584
Field Costs 250,223 250,223 250,223
Lost Revenues 380,246
Total Costs 273,317 550,900 931 146
. auantec
Evaluation of the Idaho Irrigation Load Control Credit Program 111-3
Table III.3 shows bow energy and demand savings, ~osts, and benefits vary by
year for the five..year ~valuation term (~003 through 2007). For each year
after the first, the results are based on an assumption that the number of
participants is the same as in the first year:'4 Program costs vary by year, as
shown previously in Table ll.3. Table IIIj'demonstrates that the Program
becomes more cost effective over time. While the (undiscounted) benefits
added each year remain constant, Program costs decline after the initial fieldexpenses. 5
Table DI.3: Five-Year Cost-Effectiveness Sul1U11ary
"C"'C."l---Ji:"
.."---
)r-
."',--" ".' ", "' "-" '-""
RaHo-'
' "
kWh kW .'AnnuaJ"Annual Cumulative mulativ Basedonerspeclve ear.,
. ", ,' ", ,, ""
Savmgs:Savmgs Senefits--Costs : Benefits ,
' '
Costs "Cumulatlve
l."Values)
TAC
2003 7,917,839 167,987 $452 02 $273,316 $452,029 $273,316 1.
2004 7 964,999 168,773 ,$437,11 $103,380 $889,146 $376 696 2.
2005 7 964,999 168,773 $425,75 $~O3,402 $1 314 896 $480,098 2.
2006 7 964 999 168 773 $414 70 $103 184 $1 729 603 $583,282 2.
2007 7,964,999 168,773 $403,96 $102,751 $2,133,572, $686,032 3.
,?~~J1Zj~,
~:"
~1-~~~~.~i~ ~j~f$4~gl~g , !~~i$$~~i~gQjr~ ~*r~~\gg~, ~J~-$pfjQ;~Q~;% ~~~~;cWiQJ!1~~&
iY-(~~~~~~ ij\~~J~~;;~%~)~:$~gp~~!,., i~!,t~~p~iM~~~ *~~~~mtt '~J~$~tQ;t~~;1; ~j~;r.O(~1!;~9.j,~
i?9~; .~j~~J~~~ ~n~i7ft~~j\';f$mK~~;~ W:~~~~~p-~~j~*~!t~~t~~Ji jt~$J;41~;4'!~t;~;t&4i)~~;lfo:~~~t.
$JiOP~
~~~'
~Sj~~!\fW~i!:$$~~~~:3 , ~~-1rpj~~J~~'~' N':$~.;$p8;~~t;
19PP1~ I~! ~:~~~~!i;;;ft~1i$9J?9j$~ ~~~~rg~kl!l i~B~9Z~~;1~1~
2003 7 917,839 167 987 '$452 02 $452 029 $931 147
2004 7 964 999 168,773 $426 61 $878,646 $1 645,764
2005 7,964,999 168,773 $405 54 $1,284,188 $2,313,466
2006 7 964,999 168 773 $385 53 $1,669,721 $2 937 316
2007 7 964,999 168,773 $366,53 $2,036,251 $3,520,180
~QQ~i~;~!:t~~~ H190i~~f):;j:W:$9!57)~~" ;~~r;!$.~~t.~~~mdgd~J
g '
~11'$~;'i7an:M;;;l$~~9;7g~ Jf$1;~~1~$~W;
~~Q.Q~;~\;~~~;(\7~f:%l:;:$&pQ;~,~ \\l'$.j~f3M!;t-?;~M~
~QP6i $(;'~M;~~~ :;M-Q~iYf~:N;8!..:$$~W;92 , i;:~~;~q~;~~d;j
2QOti 7~~;~,~ h;;1fJ~;7;7$/;W-'$489;63 ::ij$?,~$a;~t,g,
AIM
For a five-year evaluation term, Table III.4 shows that the Program is cost-
effective from both TRC and PacifiCorp s perspectives. To PacifiCorp, the net
present value (NPV) of the Program is more than $168 000. From the
participants' perspective, the NPV of the Program is more than $2.8 million.
The RIM test is the only one under which the five-year Program is not cost
The energy savings figures, however, were adjusted upward to account for fun
participation in July (as discussed earlier),
Note that while Table Ill.3 presents some of the same results as Table III.2, there are
some small differences due to rounding.
Quanfec
Evaluation of the Idaho Irrigation Load Control Credit Program 111-
effective. Energy-efficiency programs often do not pass this test because of .
the inclusion of lost revenues as a cost.
. Table 111.
Cost Effectiveness - Five-Year Offering
TRC
UTC
RIM
PART
Detailed Results
Benefits
Avoided Costs
Bill Reduction
Incentive Payments
447,540
168,334 .
(1,483,930)
858,320
TRC
133 572 $
UTC
036,250 $
RIM
036,250
PART
Total Benefits 133,572 036,250
TRC UTC
110,677 $105 596 $
206,056
575,356 556,264 $
686,032 867 916
652,264
1,206,056
858,320
PARTCosts
Program Administration
Participant Incentives
F'mld Costs
Lost Revenues
Total Costs
. auantec
Evaluation of the Idaho Irrigation Load Control Credit Program 111-