20170915_Comment.PDF

Diane Holt
From:[e-mail]
Sent:Friday,September 15,2017 3:33 PM
To:Beverly Barker;Diane Holt;Matthew Evans
Subject:Case Comment Form:Lynn Anderson
Name:Lynn Anderson
Case Number:INT-G-17-03
Email:[e-mail]
Telephone:[phone]
Address:720 Bacon Dr.
Boise Idaho,83712
Name of Utility Company:Intermountain Gas
Comment:Quote from IPUC Order No.33365 (pp.9-10)in IPC-E-15-06 regarding TRC,UCT and PCT cost-effectiveness
tests for evaluating demand-side management (DSM)programs:
“Commission Findings:We believe each perspective can help inform the Commission,the utility,and stakeholders
about a particular program’s effectiveness....the Company ultimately must persuade us that its program investments
were prudent on the totality of the circumstances.”
Quote from The National Action Plan for Energy Efficiency’s “Understanding Cost-Effectiveness of Energy Efficiency
Programs,”Section 4.7,
“Establishing the Net-to-Gross Ratio:
Establishing the NTG is critical to understanding overall program success...”
In reference to direct testimony of Allison Spector,pp 25-26 in Case No.INT-G-16-02:
Company witness Spector stated that the Company takes “free ridership”into consideration,but her Exhibit No.26
shows that the Company did not include net-to-gross (in ‘Tfree ridership”)adjustments for any of its energy efficiency
program cost-effectiveness calculations.Thus,benefit/cost ratios calculated by dividing the Company’s total avoided
cost benefit per therm saved for each measure by the estimated total costs of each measure would be overstated to the
extent that some of its customers would have installed the measures in absence of the Company’s program.
Unfortunately,the Company’s Exhibit No.26 does not show correctly calculated B/C ratios using the benefit and cost
data it provides.(This exhibit further confuses the issue by mislabeling the erroneously calculated ratios as
“Cost/Benefit Ratios”instead of “Benefit/Cost Ratios.”)
Even if the Company’s basic avoided cost benefit and program cost data are reasonably estimated,then simple B/C
ratios correctly calculated will be significantly lower than those shown in the Company’s Exhibit 26.For example,Exhibit
26 shows the Standard Rebate for a 95%AFUE Furnace as having a 1.635 UCT B/C ratio,but when dividing the stated
avoided cost benefit of $0.53182/therm by the $O.507 total cost per therm saved,the result is a much lower 1.05 UCT
B/C ratio.Adjusting the stated base data with credible net-to-gross (NTG)estimates will further reduce the ultimate
B/C ratios,resulting in most or all of the measures’UCT ratios falling below 1.0,the threshold for cost-effectiveness.
Correctly calculated TRC ratios will all be far below 1.0 even without NTG adjustments.It should be noted that the UCT
is much more sensitive to NTG adjustments than is the TRC.
Given the likelihood that few,if any,of the the Company’s energy efficiency measures will prove to be cost-effective
from the UCT perspective when that B/C test is properly calculated and given the certainty that none of the measures
will pass the TRC test,it is unreasonable for the Company to charge its customers for its energy efficiency program in
advance of proving to the Commission that “its program investments were prudent on the totality of the
circumstances.”Thus I am opposed to the Company’s request for a DSM program funding mechanism.
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Thank you for your consideration of these comments.
Unique Identifier:67.60.48.73
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