20160114Petition for Reconsideration.pdf

ldaho Public Urrritres Commission
Office of the SecretarvRECEIVED
JAN I 4 zItt
Boise, ldaho
ldaho Public Utilities Commission Case No. AVU-G-15-03
Petition for Clarification and Reconsideration of Order No. 334'14
We, the Technical Commenters, as so labeled by Order No. 33344,
still believe and advocate that the recent moves by the Commission and its Staff
toward accepting or mandating that ldaho utilities rely primarily on the Utility
Cost Test (UCT) for determining cost-effectiveness of demand-side management
(DSM), rather than continuing to require reliance on multiple cost-effectiveness
tests, including the total resource cost test (TRC), should be halted until these
issues are discussed and debated for all ldaho utilities in a generic docket. We
recognize that DSM cost-effectiveness issues are arcane and can be difficult to
understand by those who have not immersed themselves in them, but that fact
does not make the issues unimportant and without need of a more open and
thorough vefting than they have been given in case numbers AVU-G-15-03 and
IPC-E-15-06. That said, we have other issues with Order No. 33444 in AVU-G-
15-03. Following are six of those issues and we ask the Commission for
clarification or reconsideration of Order No. 33344 as appropriate.
1) On page 5, the Order states "...the Technical Commenters did not seek to
interuene in this case, and the Staff did nof express concern about the discovery
responses." Please clarify if this statement means that it is permissible for
utilities to provide purposely misleading responses to production requests if the
Staff or some other party does not object to misleading responses. Please
further clarify whether the Commission is willing to recognize misleading
statements when members of the public identify such statements. (See attached
Avista response to Staffs Production Request No. 6.)
2) On page 7,lhe Order states "...rls new approach to avoided cosf was
thorouqhlv reviewed and vetted..." (emphasis added) We cannot find in the
record of this case a claim by either Avista or the Staff that the new approach to
avoided cost was "thoroughly'' reviewed and vetted. We ask that the Order be
amended by removing the word "thoroughly''in this sentence because we
believe that the issue was not, in fact, thoroughly reviewed and vetted and that
the Order saying it was is unfounded and prejudicial.
3) On page 9, the Order states "As a practical matter, this shift may result in
more DSM resources being selected as cosf-effective in future /RP cases,
thereby addressing the underlying @ncerns of the Technical Commenters." But
the true underlying concern of the Technical Commenters was that resources
would be spent on DSM that was not cost-effective. Please clarify how a shift
resulting in more DSM addresses our underlying concern.
Page 1 of 3
4) On page 9, the Order states "...we find that the proposed programs appear
cost-effective under either the TRC or the UTC." [sic] This claim is also stated
on page 12 in the Summary. We cannot find in the record any claim by the
Company or the Staff that the proposed programs are cost effective under the
TRC. ln fact, Table 1 in Staffs comments (p. 4) show TRC benefiUcost (B/C)
ratios well below the cost-effective threshold of 1.0 for the residential portfolio,
the C&l portfolio, and the total portfolio, with or without the low income program,
even with a 10% conservation adder and even with inclusion of elements not
seen as legitimate by the Technical Commenters. Please clarify if the
Commission views aBlC ratio of less than 1.0 as being cost-effective and, if so,
please clarify what the Commission's threshold B/C ratio indicating cost-
effectiveness is. lf the Commission instead believes that a 1.0 B/C threshold
delineates cost-effective from cost-ineffective, we ask the Order be amended to
not state that the proposed programs appear cost-effective under the TRC.
5) On page 8, the Order states "Finally, it is worth noting the Technical
Commenters do not allege that the proposed programs are cost-ineffective." For
the record, Jonathan Powell stated on page 7 of his comments that an
independent evaluation of Avista's Washington gas DSM showed a TRC B/C
ratio of 0.35 and a UCT B/C ratio of 0.80, thus the Washington program was
shown to be cost-ineffective by both tests, and that the ldaho portfolio would be
expected to perform similarly. Further, Lynn Anderson stated on page 4 of his
comments, that when net-togross (NTG) factors are applied and other errors
corrected, Avista's projected B/C ratios would decrease perhaps to the levels
predicted by Jonathan Powell. ln other words, both Technical Commenters
\Mere, in fact, alleging that the proposed programs would be found cost-
ineffective by an independent evaluator under both the TRC and the UCT. We
ask that the Order be amended to not misrepresent our comments.
6) On page 10, the Order states that Staff noted "...that the Commission has
previously approved DSM programs that include 1A0% NTG that included a
sensitivity analysis..." and the Order then found "...ffris approach rs consisfenf
with the approach adopted by ldaho Power;' lt is important to know that ldaho
Power's NTG sensitivity results shown in its 2014 Annual DSM Report
Supplement 1: Cost-Effecfiveness are applicable only to the TRC cost-
effectiveness test and that the TRC is much less sensitive to low NTG factors
than is the UCT. As such, we ask that the Order be amended to either delete
the reference to consistency with ldaho Power's approach or to clarify that
performing NTG threshold sensitivity analyses in place of actually including NTG
factors in determining UCT cost-effectiveness is an unprecedented approach to
UCT cost-effectiveness. page 2 of 3
Technical Commenters' Petition for Clarification and Reconsideration of Order No. 33344
Thank you for your consideration,
9
Lynn Anderson
for
Technical Commenters
Jonthan Powell
3818 W Ballard Road
Spokane, WA 99208
509466-61 17
[e-mail]
and
Lynn Anderson
72A Bacon Drive
Boise, ldaho 83712
208-3/.2{,317
[e-mail]
(date)
Technical Commenters' Petition for Clarification and Reconsideration of Order No. 33344
Page 3 of 3
AVISTA CORPORATION
RESPONSE TO REQUEST FOR INFORMATION
JURISDICTION:
CASE NO:
REQUESTER:
TYPE:
REQUEST NO.:
IDAHO
AVU-G-15-03
IPUC
Production Request
Staff-06
DATE PREPARED:
WITNESS:
RESPONDER:
DEPARTMENT:
TELEPHONE:
wa2l20t5
N/A
Mike Dillon
DSM
(s09) 49s-4260
REQUEST:
Please describe how the Company uses net-to-gross estimates when determining whether to
implement and how to manage natural gas conservation programs. If the Company does not
consider net-to-gross estimates, please explain why not. Furthermore, please estimate how
applying a net-to-gross to the UCT could impact cost-effectiveness.
RESPONSE:
Since a net-to-gross adjustment measures the motivation of why an energy efficiency measure was
acquired by a customer it adjusts both the value ofthe conservation savings as well as the customer
incremental cost. In a net TRC that provides a reduction in both the numerator and the
denominator of a B/C ratio calculation, the reduction does not completely cancel out due to the
presence of Non-energy impacts and programmatic costs in both the numerator and denominator.
Since the UCT is only looking at the benefits of conservation in the numerator and the costs the
utility pays to acquire that conservation from incentives and programmatic costs in the
denominator, a net-to-gross adjustment would be a direct reduction in the UCT (i.e. UCT: 2.0,
net-to-gross ratio of 0.7 would yield a net UCT of 1.4).
Attachment to Technical Commenters'
Petition for Clarification and Reconsideration of Order No. 33344