20220401Final_Order_No_35363.pdf

ORDER NO. 35363 1

Office of the Secretary
Service Date
April 1, 2022

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF ROCKY MOUNTAIN
POWER’S APPLICATION FOR
AUTHORITY TO INCREASE ELECTRIC
SERVICE SCHEDULE 191—CUSTOMER
EFFICIENCY SERVICES RATE
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CASE NO. PAC-E-22-03

ORDER NO. 35363

On January 24, 2022, Rocky Mountain Power Company, a division of PacifiCorp,
(“Company”) applied to the Idaho Public Utilities Commission (“Commission”) for authority to
increase its Schedule No. 191 – Customer Efficiency Service Rate Adjustment from 2.25% to
2.75%. Application at 1. The Company stated that the increase would “better align revenue
collections with demand-side management (“DSM”) expenditures while gradually balancing the
deferred account associated with acquiring and administering DSM programs in Idaho over the
next three years.” Id. The Company requested that its Application be processed through modified
procedure and take effect April 1, 2022. Id.
On February 16, 2022, the Commission issued a Notice of Application and Modified
Procedure setting deadlines for the Company and interested persons to comment. See Order No.
35322. Comments were received from Commission Staff (“Staff”) and two customers. The
Company did not reply.
Now, the Commission issues this final Order rejecting the Company’s Application.
BACKGROUND
The Commission has supported cost-effective DSM programs. The Company has
offered a variety of DSM programs to its customers since the 1970s. Application at 2. DSM
programs are designed with the goal to be cost-effective. Id. On March 2, 2006, the Commission
approved cost recovery of the Company’s DSM programs through Schedule 191 applied to
customer bills. Id. The Company represented that its proposed increase was consistent with the
Company’s previous Schedule 191 rate adjustment approved in Case No. PAC-E-18-12. See Order
No. 34255. In that case, the Company gradually balanced the DSM account over the 2018-2021
period. Application at 3. To monitor the balance of Schedule 191, the Commission implemented
an annual reporting process. Id. As of December 31, 2021, the Company reported that its Schedule

ORDER NO. 35363 2
191 balance was over-collected by $180,721. Id. However, the Company estimates that its future
DSM expenditures will exceed revenue collections without adjustment. Id.
THE APPLICATION
The Company’s Application included a summary of the projected monthly DSM
expenditures and Schedule 191 revenues collected through December 31, 2024. See Application
at Attachment A. Using the currently approved 2.25 percent tariff rate, the Company anticipated
that by the end of 2024, the DSM balancing account would be under-collected by about $2.7
million. Application at 3. However, the Company represented that if it adjusted the Schedule 191
tariff rate to 2.75 percent, the balancing account would be over-collected by $217,005 by the end
of 2024—assuming the DSM expenditures each year remained consistent. Id.; see also Attachment
B. The Company estimated that adjusting the Schedule 191 collection rate to 2.75 percent would
result in a $5.52 per-year increase in the average residential customer’s bill. Id. at 4; see also
Attachment D.
COMMENTS
A. Staff’s Comments
Staff supported the Company’s request to increase the Schedule 191 tariff rate
anticipating the proposed new rate would better align DSM revenues with the Company’s
projected expenses. Staff Comments at 3. The Company anticipated that its DSM expenditures
would increase from $4.7 million in 2021 to $5.7 million in 2022, 2023, and 2024—due to the
Company’s proposed implementation of the Battery Demand Response and Wattsmart Business
Demand Response programs1 Id.; see also Company’s Response to Production Request 5. Staff
confirmed that adjusting the tariff rate to 2.75 percent, as proposed by the Company, would better
align the Company’s projected revenue needs for DSM expenditures through 2024. Staff
Comments at 3. Staff also confirmed the Company properly applied the new Schedule 191 tariff
rate adjustment to customer classes. Staff Comments at 3.
Staff expressed concern over the Company’s failure to apply for approval of its
proposed Wattsmart Business Demand Response Program before applying for authority to adjust
the Schedule 191 rate. Id. Staff stated that the Company included $750,000 in projected annual
expenses associated with the Wattsmart program—without having received authorization from the

1 The Company applied for authority to implement the Battery Demand Response program in Case No. PAC-E-21-
16. The Commission has not issued a final order in that case. The Company has not applied for authority to implement
the Wattsmart Business Demand Response program as of the date of this Order.

ORDER NO. 35363 3
Commission. Id. Staff worried that DSM program expenditures could grow by more than a million
dollars for each of the next three years, partially due to unauthorized programs. Id. Accordingly,
Staff suggested the Company should adjust its tariff rider when the Commission issues the orders
approving or rejecting the Company’s proposed demand response programs. Id.
B. Public Comments
Two customers filed public comments opposing the Company’s Application. One
customer stated that the Company “does not have the right to increase customer bills by .5 percent
in order to recover investments made on behalf of customers to provide energy efficiency
programs.” Comments of Erica Richardson (03/04/2022). Ms. Richardson stated that if she were
required to pay for such a program, “it should be a one-time payment, not a reoccurring payment
for an indefinite amount of time.” Id. Another customer stated “energy efficiency programs should
be a voluntary decision—not mandatory.” Comments of Val Orme (03/11/2022).
COMMISSION FINDINGS AND DECISION
The Commission has jurisdiction over this matter under Idaho Code §§ 61-501, -502,
and -503. The Commission is empowered to investigate rates, charges, rules, regulations, practices,
and contracts of public utilities and to determine whether they are just, reasonable, preferential,
discriminatory, or in violation of any provision of law, and to fix the same by order. Idaho Code
§§ 61-502 and -503.
Having reviewed the record we issue this final Order rejecting the Company’s
Application. We are concerned the Company’s proposed DSM expenditures forecast includes
expenses for programs that have not yet been approved by the Commission. It is premature to
authorize the Company’s proposed Schedule 191 tariff rate increase when we have not authorized
two of the programs that act as the catalyst for the Company’s need to recover additional DSM
rider funds to ensure proper funding. The Company should first obtain final Commission approval
of its Battery Demand Response (Case No. PAC-E-21-16) and seek approval of the Wattsmart
Business Demand Response programs.
We have long viewed DSM as a cost-effective energy efficiency tool. This
Commission has encouraged utilities to pursue and offer cost-effective DSM and energy-efficiency
programs and has regularly authorized corresponding expenditures as prudently incurred for rate
making purposes. Although we reject the Company’s Application at this time this does not bar the
Company from seeking to modify the rate under Schedule 191 after the programs whose expenses

ORDER NO. 35363 4
are to be recovered by such mechanism have been reviewed and possibly approved by Commission
order.
O R D E R
IT IS HEREBY ORDERED that the Company’s Application is rejected.
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within twenty-one (21) days of the service date of this Order with regard to any
matter decided in this Order. Within seven (7) days after any person has petitioned for
reconsideration, any other person may cross-petition for reconsideration. See Idaho Code § 61-
626.
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 1st day
of April 2022.

ERIC ANDERSON, PRESIDENT

JOHN CHATBURN, COMMISSIONER

JOHN R. HAMMOND JR., COMMISSIONER

ATTEST:

Jan Noriyuki
Commission Secretary

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