20160209reconsideration_order_no_33464.pdf

Office of the Secretary
Service Date
February 9,2016
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE I ATTER OF AVISTA )
CORPORATION’S APPLICATION TO )CASE NO.AVU-G-15-03
RESUME NATURAL GAS EFFICIENCY )
PROGRAMS AND INCREASE THE RIDER )
SURCHARGE IN SCHEDULES 190 AND )ORDER NO.33464
191.)
On October 28,2015,Avista Corporation dba Avista Utilities filed an Application for
authority to resume its natural gas energy efficiency programs for residential,commercial,and
industrial customers.Application at 1.On December 24,2015,the Commission issued final
Order No.33444 approving that Application.On January 14,2016,two public commenters filed
a Joint Petition requesting that the Commission reconsider or clarify that Order.Petition at 1.
Avista did not file a response to the Petition.Based upon the review of the Joint Petition and our
record,we grant the Petition in part and deny the Petition in part,as set out in greater detail
below.
BACKGROUND
On November 20,2015,the Commission solicited public comment on Avista’s
proposals to resume various natural gas demand-side management (DSM)programs.Two public
commenters provided the Commission with highly detailed and technical comments opposing
the Application.In the Commission’s Order their remarks were analyzed and summarized
together as the comments of “Technical Commenters.”They generally argued that the
Application warranted heightened scrutiny,offered a detailed analysis of Avista’s proposal,and
provided an alternative view of the proposed DSM programs.
Their comments provided the Commission with additional analysis and perspective
and the Commission lauded the efforts.Ultimately,however,the Commission concluded that
Avista had demonstrated that restarting the DSM programs and the surcharge were reasonable.
In approving Avista’s Application,the Commission allowed certain modifications to the
previous iteration of the Company’s natural gas DSM programs.For instance,the Commission
approved the use of Utility Cost Test (UCT)as the benchmark measurement for cost-
ORDER NO.33464 1
effectiveness,’and allowed the use of “gross,”rather than “net”savings estimates in the
Company’s cost-effectiveness calculations.Order No.33444 at 2,8-9.
LEGAL STANDARD
Reconsideration provides an opportunity for a party to bring to the Commission’s
attention any question previously determined and thereby affords the Commission with an
opportunity to rectify any mistake or omission.Washington Water Power Co.v.Kootenai
Environmental Alliance,99 Idaho 875,879,591 P.2d 122,126 (1979).The Commission may
grant reconsideration by reviewing the existing record,by written briefs,or by evidentiary
hearing.IDAPA 31.01.01.332.If reconsideration is granted,the Commission must complete its
reconsideration within 13 weeks after the deadline for filing petitions for reconsideration.Idaho
Code §61-626(2).
Consistent with the purpose of reconsideration,the Commission’s Procedural Rules
require that petitions for reconsideration “set forth specifically the ground or grounds why the
petitioner contends that the order or any issue decided in the order is unreasonable,unlawful,
erroneous or not in conformity with the law.”Rule 331.01,IDAPA 31.01.01.331.01.Rule 331
requires that the petitioner provide a “statement of the nature and quantity of evidence or
argument the petitioner will offer if reconsideration is granted.”Id.Further,Rule 325 provides
that “[amy person may petition to clarify any order,whether interlocutory or final.”
IDAPA 31.01.01.325.
ISSUES ON REVIEW
The Technical Commenters’Petition lists six specific items for reconsideration or
clarification.Several of the items on reconsideration/clarification take umbrage with the use of
certain words or statements in the Order.For example,they object to the use of the word
“thoroughly”in the sentence,“...avoided cost was thoroughly reviewed and vetted.”They also
ask whether “it is permissible for utilities to provide purposely misleading responses to
[discovery].”Petition at 1.They also complain that the Commission mischaracterized some of
l The UCT compares program administrator costs to supply-side resource costs,and assesses whether utility bills
will increase.Previously,the benchmark measurement for Avista’s natural gas DSM programs was the total
resource cost test (TRC).The TRC compares program administrator costs and customer costs to utility resource
savings,and assesses whether the total resource cost of energy in a utility’s service territory will decrease.The
Commission allowed this change due to,among other things,the potential for bias against conservation under a TRC
benchmark,and with the commitment from Avista to continue reporting and evaluating numerous cost-effectiveness
tests when examining its DSM programs’cost-effectiveness (including both the UCT and the TRC)going forward.
Order No.33444 at 8.
ORDER NO.33464 2
their comments.They reiterate that their primary concern is to avoid DSM programs that are not
cost effective.Id.
1.Comparing the UCT and TRC Methodologies (Item No.4)
The Commission first takes up the Technical Commenters fourth request for
clarification or reconsideration.There,the Technical Commenters take issue with the
Commission’s statement that “[Ilinally,we find that the proposed programs appear cost-effective
under either the TRC or the UCT.”Order No.33444 at 9.The Technical Commenters assert
that the record does not support this finding.
After reviewing our prior Order and the underlying record,we determine that this
statement is erroneous and should be clarified.Accordingly,with regard to their fourth request,
reconsideration is granted and that sentence on page 9 of Order No.33444 is clarified to read as
follows:
Finally,we find that the proposed programs appear cost-effective under the
UCT,and a good portion of those programs also appear cost-effective under
the TRC.We are encouraged by the continued use of the TRC,and other
evaluative methods in future prudency reviews.We anticipate that any
potential negative trends in cost-effectiveness will be revealed and addressed.
Likewise,we approve of utilization of the UCT as a threshold test for the
proposed DSM programs.There will be further opportunity to address the
effectiveness of this approach in upcoming prudency filings.
2.Net-to-Gross Adjustments (Item No.6)
The Technical Commenters ask the Commission to reconsider or clarify a sentence
addressing net-to-gross (NTG)adjustments on page 10 of Order No.33444.There,the
Commission addresses Avista’s proposed use of 100%NTG.The Commission stated that
Avista’s approach to calculating NTG “is consistent with the approach adopted by Idaho Power.”
The Technical Commenters assert that this statement is imprecise because Idaho Power’s NTG
calculation is “applicable only to the TRC cost effectiveness test....“Petition at 2.They ask
that the reference to consistency be deleted or clarified.
After reviewing the Petition and the record in this case,with regard to the Technical
Commenters sixth request,reconsideration is granted and we clarify the sentence on page 10 to
read:
“We find this approach is consistent with the approach adopted by Idaho
Power using the TRC test.”
ORDER NO.33464 3
3.Other Grounds for Clarification or Reconsideration (Items 1,2,3,and 5)
The remaining four requests for clarification or reconsideration consist of
anatomizing the Commission’s final Order to include questions relating to word meaning,the
discovery process,and the Commission’s characterization of the issues.Specifically,the
Technical Commenters allege that:the Company’s discovery responses were “purposefully
misleading”and if unchallenged,will become authoritative (Item 1);the use of the word
“thoroughly”when used to describe parties’analysis is inappropriate (Item 2);and the
Commission mischaracterizes their underlying concerns about DSM (Items 3 and 5).
The Commission declines to address or clarify these four items.We note,however,
that discovery responses,including answers to interrogatories are to be truthful,made under oath,
and signed by the party to whom they are directed.Rules 225.01 and 228.02;IRCP 33(a)(2).
We also reject the Technical Commenters’invitation to engage in parsing and redefining of
words.We see no reason to amend our Order for these items,and we will not further disturb the
Order approving the DSM programs.We find these four items to be argumentative and
inconsistent with the purpose of reconsideration.In other words,the Petitioners have failed to
demonstrate how these items are unreasonable,unlawful,erroneous or not in conformity with the
law.
While the Technical Commenters may have different ideas when it comes to the
efficacy of the UCT and the place for net-to-gross factors,as stated in our previous Order,
“Avista has met its burden of showing that approval of the Application is fair,just and
reasonable;and re-establishing Avista’s natural gas DSM programs is in the public interest.”We
share their concern that DSM programs be cost-effective,and we expect Avista to actively
manage those programs to ensure that they achieve that end.Accordingly,
clarification/reconsideration is denied as to Items 1,2,3,and 5.
ORDER
IT IS HEREBY ORDERED that the Petition for Clarification and Reconsideration is
granted in part and denied in part,as set forth above.
IT IS FURTHER ORDERED that Commission Order No.33444 is amended,as
clarified above,pursuant to Idaho Code §6 1-624.
ORDER NO.33464 4
THIS IS A FiNAL ORDER ON RECONSIDERATION.Any party aggrieved by
this Order may appeal to the Supreme Court of Idaho pursuant to the Public Utilities Law and the
Idaho Appellate Rules.See Idaho Code §61-627.
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this q
day of February 2016.
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/—z 47/—
PAUL KJELLANDER,PRESIDENT
KRI TINE RAPER,COMMISSIONER
Commissioner Anderson did not participate in this case
ERIC ANDERSON,COMMISSIONER
ATTEST:
/L &
J4n D.Jewell
C5mmission Secretary
O:AVU-G-1 5-03bk3
ORDER NO.33464 5