20141219press release.pdf

Case No. PAC-E-14-07, Order No. 33188
Contact: Gene Fadness [phone], 890-2712
www.puc.idaho.gov

Commission finds Rocky Mountain Power investment
in demand-side management program is prudently incurred

BOISE (Dec. 19, 2014) – About $25.76 million of Rocky Mountain Power company investment in
demand-side management (DSM) programs during 2010-13 was prudently incurred and
beneficial to both the company and its southeast Idaho customers, state regulators
determined. The commission’s finding does not impact customer rates.

DSM refers to programs that encourage customers to use less energy or shift use away from
peak hours, thus reducing demand on Rocky Mountain’s generation system. Customers pay for
most of the programs through a rider that appears on customer bills called “Customer
Efficiency Services.” The rider is currently set at 2.1% of a customer’s monthly billed amount.
Investment in an irrigation load control program (about $8.1 million of the total $25.76 million)
has been shifted to recovery through base rates rather than through the rider.

The commission’s prudency review is to determine if the funds invested in the programs are
reasonable and beneficial to customers, including customers who do not directly participate in
the programs.

The programs, directed toward residential, commercial, industrial and irrigation customers,
saved the utility 11,963 megawatt hours in 2010; 8,688 MWh in 2011; 11,420 MWh in 2012 and
18,324 MWh during 2013. That reduced consumption lowers power supply expense for all
customers and eliminates or delays the need to build new generating facilities.

Commission staff audited the company’s internal controls and processes and interviewed DSM
program managers. Staff said Rocky Mountain has “rigorous internal controls” to help ensure
precise allocation of the costs and benefits within each DSM program. The staff noted that in
2012 and 2013 the company surpassed its Conservation Potential Assessment and that in all
years except 2010 exceeded its energy savings goals as outlined in its long-range Integrated
Resource Plan.

Rocky Mountain Power offers three programs to residential customers. “Home Energy Saver”
provides products and services such as attic insulation and floor insulation, energy efficient
windows, CFL lighting and other services. “Refrigerator Recycling” offers rebates for removal
and recycling of inefficient refrigerators and freezers. “Low-Income Weatherization” provides
energy efficiency services to residential customers meeting income guidelines.

Three other programs targeted commercial, industrial and agricultural customers. “FinAnswer
Express” helped commercial and industrial customers improve the efficiency of their lighting,
HVAC, electric motors, building envelopes and other equipment. “Energy FinAnswer” was
available to commercial and industrial customers in excess of 20,000 square-feet and included
incentives for improvements to HVAC systems, motors, refrigeration, lighting and other
equipment. “Agricultural Energy Services” was designed to improve overall efficiency of
irrigation systems. (In a separate case, these programs were consolidated into a single program
to be marketed as “wattsmart Business.” All three were merged effective Nov. 1, 2014, under
one tariff called Non-Residential Energy Efficiency, Schedule 140.)

Only two of the programs did not pass cost-effectiveness tests. The portion of the Agricultural
Energy Services program that offered irrigation customers a nozzle exchange as well as
measures to make pivot and linear equipment more efficient has been discontinued. The Low-
Income Weatherization program, while not yet cost-effective, will be continued while the
company works with the commission and southeast Idaho community action agencies to
increase participation.

The commission staff found that many of Rocky Mountain’s industrial and commercial
customers are not aware of the energy efficiency programs available to them. The commission
directed the company to work more closely with staff to develop a more structured advertising
method targeting non-residential customers.

Documents related to this case, including the commission’s final order, are available on the
commission’s Website at www.puc.idaho.gov. Under the “Electric” heading click on “Open
Cases” and scroll down to Case No. PAC-E-14-07.

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