20100603Comments.pdf

KRISTINE A. SASSER
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
BAR NO. 6618
R.. ,. i: 1\/ ¡. f)tlJC" -.-'
iU\O JUN -3 PM It:, 39
n l'l4'"'\. .r.. ,v
'\LtT'H:~û1 i "-'''
Street Address for Express Mail:
472 W. WASHINGTON
BOISE, IDAHO 83702-5918
Attorneys for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )
OF PACIFICORP DBA ROCKY MOUNTAIN )
POWER FOR AN INCREASE TO THE )
CUSTOMER EFFICIENCY SERVICES RATE. )
)
)
)
CASE NO. PAC-E-IO-3
COMMENTS OF THE
COMMISSION STAFF
COMES NOW the Staff of the Idaho Public Utilties Commission, by and through its
Attorney of record, Kristine A. Sasser, Deputy Attorney General, submits the following
comments in response to the Notice of Application and Notice of Modified Procedure issued on
May 7, 2010. Order No. 31076.
BACKGROUND
On February 25, 2010, PacifiCorp dba Rocky Mountain Power (Company) fied an
Application with the Commission seeking authority to increase its Customer Effciency Services
Rate (Schedule No. 191). More specifically, the Company proposes to increase the collection for
Schedule No. 191 from 3.72% to 5.85% of retail revenue, excluding large contract customers.
The Company requests that the Application be processed by Modified Procedure. l
i The Company initially requested a May I, 2010, effective date, but has agreed to suspend the requested effective
date and "wil continue to work with staff to process this application as expeditiously as possible." Letter from Ted
Weston dated April 28, 2010.
STAFF COMMENTS 1 JUNE 3, 2010
In March 2006, the Commission approved an enhanced set of demand-side management
(DSM) programs and cost recovery through Schedule No. 191. Application at 3. The collection
rate was initially set at 1.5% of retail revenue (Order No. 29976). In 2008, the Commission
approved an increase from 1.5% to 3.72% (Order No. 30543). The Company now proposes to
increase the collection for Schedule No. 191 from 3.72% to 5.85% of retail revenue. Application
at 5.
STAFF ANALYSIS
The Company asserts that this adjustment is needed to facilitate the funding of ongoing
DSM program expenditures and to reduce the accrued balance of expenses (yet to be recovered)
in the DSM balancing account from $3.5 milion (the April 2010 forecasted balance) to $2.25
milion by April 30, 2011. ¡d. The Company maintains that it wil continue to review funding
needs on an annual basis to determine whether an increase to 5.85% is sufficient to fud ongoing
program expenses and also recover the remaining balance in the DSM balancing account. ¡d.
The Company also states that administration of the balancing account, including carying
charges, prudency review, and separating these costs from the revenue requirement in general
rate cases would continue pursuant to Order No. 29976. The Company's Application anticipates
that at 5.85%, Schedule No. 191 wil provide approximately $8.325 milion per year, assuming
2008 energy usage levels. ¡d.
As can be seen in the Company's 2009 DSM anual report, all major customer
classifications are receiving benefits from the current portfolio of DSM programs. The expected
anual DSM expenses associated with Schedule 191. per customer class for the May 1, 2010
through April 30, 2011 timeframe are as follows:
. Residential Programs - $980,000
. Commercial and Industrial - $800,000
. Agricultural - $4,900,000
. Northwest Energy Efficiency Allance - $264,000
The cost of these programs is directly assigned to the Idaho Jurisdiction and recovered
from Idaho customers. Of the estimated $8.325 millon generated anually by the proposed
Customer Effciency Services Rate, $4.3 milion is expended by the Irrigation Load Control
Program (Schedules 72 and 72A) for field equipment, administration and overhead costs. All
STAFF COMMENTS 2 JUNE 3, 2010
Idaho customers with the exception of special contract customers pay for this program through
the Customer Effciency Services Rate. An additional $7.3 milion is recovered from all Idaho
customers through base rates to pay credits to irrigators under the Irrigation Load Control
Program. Staff will continue to evaluate whether it is reasonable to directly assign such large
load control program costs to the Idaho jurisdiction, on what basis these costs should be
recovered from Idaho customer classes, and whether any customer group should be exempt from
contributing to DSM program costs.
F or the purposes of this case, Staff verified the estimated annual level of expenditures
required to fud existing DSM programs and reviewed the existing DSM deferral balance subject
to recovery and confirmed the Customer Effciency Service Rate necessar to allow recovery of
program costs. Based on this review, Staff supports the Company's proposal to increase the
Efficiency Services Rate to 5.85%. Staffwil further evaluate DSMprogram cost effectiveness,
program prudency, and DSM cost allocation issues in the next Company general rate case.
The accumulated unfunded balance in the balancing account as of December 31, 2009
was $2,238,820 compared to an unfunded balance of $770,451 on December 31, 2008. Included
in the 2009 balance are caring charges of $46,170. During 2009 the Company collected
$5,0 I 0,486 in revenue through the Schedule 191 tariff rider, while expending $6,432,685 in
DSM expenditures. As previously stated, an additional $7,324,477 in irrigation load control
credits were issued, however these credits are not fuded by the Schedule 191 tarff rider.
Attchment A reconciles the December 31, 2009 tariff rider balance and ilustrates different
program expenditures for 2009.
CUSTOMER RELATION ISSUES
The Company's Effciency Services Rate Application, fied on Februar 25, 2010,
contained both the customer notice and press release. Staff reviewed the notice and press release
and determined that they complied with the notice requirements of Rule 125, IPUC Rules of
Procedure, IDAPA 31.01.01.125. The customer notice was mailed with cyclical bilings
beginning March 1,2010, and ending March 31, 2010. Customers had until June 4, 2010, to fie
comments.
As of June 3, 2010, two customers submitted written comments to the Commission
regarding the proposed increase to Schedule191 rates. Both customers, who are retired and on
fixed incomes, expressed opposition to the proposed increase. One customer feels unfairly
STAFF COMMENTS 3 JUE 3, 2010
penalized by a rate increase for having an all electric house built in 1968 when utilty incentives
were in place. The other customer feels that the program brings little benefit and penalizes
people who are on fixed incomes.
Staff recognizes that an increase in electricity rates wil not be viewed favorably by many
customers within the Company's service territory, particularly those on fixed incomes or those
using electricity as their primary heating source, especially given the current economic climate.
However, Staff also believes that all customers realize a net benefit from the cost effective use of
DSM initiatives, including energy efficiency and load management programs because of the
reduced need for higher cost supply-side resources. In total, customers' bils will be lower than
they would be absent such programs.
Staff often works with customers who are identified as those most likely to benefit from
energy efficiency programs, incentives and rebates. This interaction provides Staff with an
opportunity to share information, increase paricipation in energy effciency programs and assist
customers in reducing their bils. Unfortunately, easily accessible, up to date DSM program
information needed to fully assist customers can be difficult for Staff to obtain. Therefore, Staff
recommends that the Company provide in its anual DSM report clear descriptions of each
residential energy effciency program, rebate or other incentive offered by the Company. Staff
also requests that the Company provide periodic updates of any changes made to or
discontinuance of any program, rebate, or incentive. This wil assure that Staffhas the most up
to date information available to assist customers.
STAFF RECOMMENDATION
Staff supports the adjustment to the Customer Efficiency Services Rate (Schedule
No. 191) from 3.72 percent to 5.85 percent in order to faciltate the funding of cost effective
ongoing demand-side management (DSM) expenditures and the reduction of the DSM balancing
account. Staff also recommends that the Company provide in its anual DSM report clear
descriptions of each residential energy efficiency program, rebate or other incentive offered by
the Company.
STAFF COMMENTS 4 JUE 3, 2010
Respectfully submitted this 'jß! day of June 2010.
tfJ;ai !1Krst Sasser
Deputy Attorney General
Technical Staf: Gar Grayson
Bryan Lanspery
Donn English
Curtis Thaden
i:umisc:commentspace I O.3ksggbldect comments
STAFF COMMENTS 5
(1ctA.l ,
JUNE 3, 2010
TARIFF RIDER RECONCILIATION
Beginning Balance as of December 31, 2008
Schedule 191 Revenues Collected
DSM Expenditures:
Residential Services:
Low Income Weatherization
Refrigerator Recycling
Home Energy Savings
Total Residential Services Expenditures
Commercial Services:
Energy FinAnswer
FinAnswer Express
Total Commercial Services Expenditures
Industrial Services:
Energy FinAnswer
FinAnswer Express
Agricultural Energy Services
Total Industrial Services Expenditures
Irrigation Load Control Operations Expense
Market Transformation - NEEA
Carrying Charge on Unfunded Balance
Ending Balance as of December 31,2009
$ (770,450.84)
$ 5,010,485.78
$197,819.17
108,125.50
593,563.82
$(899,508.49)
$ 49,790.48
189,925.40
$ (239,715.88)
$308,636.28
73,978.69
807,238.30
$ (1,189,853.27)
$ (3,816,417.26)
$ (287,190.31)
$ (46,170.00)
$ (2,238,820.27)
Attachment A
Case No. PAC-E-I0-3
Staff Comments
6/03/10
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 3RD OF JUNE 2010, SERVED
THE FOREGOING COMMENTS OF THE COMMISSION STAFF, IN CASE
NO. PAC-E-I0-03, BY MAILING A COPY THEREOF, POSTAGE PREPAID, TO
THE FOLLOWING:
TED WESTON
ID REGULATORY AFFAIRS MANAGER
ROCKY MOUNTAIN POWER
201 S MAIN ST STE 2300
SALT LAKE CITY UT 84111
E-MAIL: ted.weston(ipacificorp.com
DANIEL E SOLANDER
SENIOR COUNSEL
ROCKY MOUNTAIN POWER
201 S MAIN ST STE 2300
SALT LAKE CITY UT 84111
E-MAIL: danieL.solander(ipacificorp.com
DATA REQUEST RESPONSE CENTER
PACIFICORP
825 NE MUL TNOMAH STE 2000
PORTLAND OR 97232
E-MAIL: dataeguest(ipacificorp.com
ERIC L OLSEN
RACINE OLSON NYE BUDGE
& BAILEY
PO BOX 1391
POCATELLO ID 83204-1391
E-MAIL: elo(iracinelaw.net
ANTHONY Y ANKEL
29814 LAK ROAD
BAY VILLAGE OH 44140
E-MAIL: tony(iyankel.net
BENJAMIN J OTTO
IDAHO CONSERVATION LEAGUE
710 N 6TH STREET
POBOX 844
BOISE ID 83702
E-MAIL: botto(iidahoconservation.org
~~\tQA-'
SECRETARY
CERTIFICATE OF SERVICE