20200901Application.pdf

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September 1,2020
Ms. Jan Noriyuki
Commission Secretary
Idaho Public Utilities Commission
P.O. Box 83720
Boise,ID 83720-0074
RE: Case No. INT-G-20-06
Dear Ms. Noriyuki:
Attached for consideration by this Commission is an electronic submission of Intermountain GasCompany's Application for a Determination of 2019 Energy Efficiency Expenses as prudently
Incurred.
If you should have any questions regarding the affached, please don't hesitate to contact me at (20g)
377-601s.
Sincerely,
da,ASLM
Lori A. Blattner
Director, Regulatory Affairs
Intermountain Gas Company
Enclosure
cc Mark Chiles
Preston Carter
INTERMOT]NTAIN GAS COMPAI\"Y
CASE NO.INT-G.20.06
APPLICATION
A1\D
E)(IIIBITS
In the Matter of the Application of INTERMOUNTAIN GAS COMPAI\"Y
For a Determination of 2019 Energy Efficiency Expenses as Prudently Incurred
Preston N. Carter, ISB No. 8462
Givens Pursley LLP
601 W. Bannock St.
Boise,Idaho 83702
Telephone: [phone]
Attorneys for Intermountain Gas Company
BEFORE TI{E IDAHO PUBLIC UTILITIES COMMISSION
In the Matter of the Application of
INTERMOUNTAIN GAS COMPANY
for a Determination of 2019 Energy
Efficiency Expenses as Prudently
Incurred
Case No.INT-G.20-06
Appr,rc,q.ttoN
Intermountain Gas company ("Intermountain" or "company''), a subsidiary of MDU
Resources Group, Inc. with general offices located at 555 South Cole Road, Boise, Idaho, pursuant
to the Rules ofProcedure ofthe Idaho Public Utilities Commission ("Commission"), 1) respectfi.rlly
submits its Energt Efficienqt 2019 Annual Report and2) makes application to the Commission for
an order designating $2,803,346 of 2019 Energy Efficiency expenditures as prudently incurred.
Please address communications regarding this Application to:
Preston N. Carter
Givens Pursley LLP
601 W. Bannock St.
Boise,Idaho 83702
prestoncarter@ givenspursley. com
kendrah@ givenspurslev. com
and
Lori A. Blattner
Director - Regulatory Affairs
lntermountain Gas Company
Post Office Box 7608
Boise,ID 83707
[e-mail]
Appr-rcauoN - 2
In support of this Application, Intermountain alleges and states as follows.
I.INTRODUCTION
lntermountain is a gas utility, subject to the jurisdiction of the Commission, engaged in the
sale of and distribution of natural gas within the State of Idaho under authority of Commission
Certificate No. 219, issued December 2,1955, as amended and supplemented by Order No. 6564,
dated October 3,1962.
Intermountain provides natural gas service to the following Idaho communities and counties
and adjoining areas:
Ada County - Boise, Eagle, Garden City, Kuna, Meridian, and Star;
Bannock County - Arimo, Chubbuck, lnkom, Lava Hot Springs, McCammon, and Pocatello;
Bear Lake County - Georgetown, and Montpelier;
Bingham County - Aberdeen, Basalt, Blackfoot, Firth, Fort Hall, Moreland/Riverside, and Shelley;
Blaine County - Bellevue, Hailey, Ketchum, and Sun Valley;
Bonneville County - Ammon, Idaho Falls, Iona, and Ucon;
Canyon County - Caldwell, Greenleaf Middleton, Nampa, Parma, and Wilder;
Caribou County - Bancroft, Grace, and Soda Springs;
Cassia County - Burley, Declo, Malta, and Raft River;
Elmore County- Glenns Ferry, Hammett, andMountainHome;
Fremont County - Parker, and St. Anthony;
Gem County - Emmett;
Gooding County - Bliss, Gooding, and Wendell;
Jefferson County - kwisville, Menan, Rigby, and Ririe;
Jerome County - Jerome;
Lincoln County - Shoshone;
Madison County - Rexburg, and Sugar City;
Minidoka County - Heyburn, Paul, and Rupert;
Owyhee County - Bruneau, Marsing, and Homedale;
Payette County - Fruitland, New Plymouth, and Payette;
Power County - American Falls;
TwinFalls County- Buhl, Filer, Hansen, Kimberly, Murtaugh, andTwinFalls;
Washington County - Weiser.
lntermountain's properties in these locations consist of hansmission pipelines, liquefied
nafural gas storage facilities, a compressor station, distribution mains, services, meters and
regulators, and general plant and equipment'
Appt tcartoN - 3
II. BACKGROT]ND
ln the Company's General Rate Case No. INT-G-I6-02,Intermountain petitioned the
Commission for authority to begin a residential Energy Efficiency Program ("EE Program"). The
Commission granted the Company's request in Order No. 33757 and found that "DSM, as both a
least-cost resource and an important element of promoting energy efficiency, is an important part of
any utility's provision of service. As such, we look forward to seeing the Company's program
develop." Case No. INT-G-16-02, Order No. 33757 at 37.
Subsqueotly, in Case No. INT-G-I7-03, the Company requested authority to implement
Rate Schedule EE - Residential Energy Efficiency Rebate Program, which outlined the program
offerings, and Rate Schedule EEC - Energy Efficiency Charge, which established a charge to fund
the program. In OrderNo. 33888, the Commission approved both rate schedules effective October
1,2017.
In Case No. INT-G-19-04,Intermountain requested that the Commission approve the
Company's 2017-2018 EE Program expenses as prudently incurred. In Order No.34536,the
Commission approved the prudency of the expenses with several conditions attached. Those
conditions were to commission a third-party EM&V study, review and update the avoided cost
calculation with the Energy Effrciency Stakeholder Committee ("EESC"), immediately and
continuously monitor, evaluate, and update its EE Program incentives with the best available datq
and discontinue the 80% AFUE condensing fireplace incentive.
To allow all interested customers to participate in the Residential Energy Effrciency Rebate
Program, and to continue to grow the Program, Intermountain requested authority to revise rate
schedule EEC from $0.00367 to $0.02093 per therm in Case No. INT-G-19-05. The Commission
approved the requested revision in Order No . 34454, effective October I , 2019 .
AppncauoN- 4
On January 28,z}z},Intermountain filed a TariffAdvice to cancel the 80% AFUE
condensing fireplace rebate. The effective date for the cancellation was March 1,2020.
The EE Program is available to all residential rate class customers in the Company's service
territory and consists of two main categories of rebates: high-efficient appliances and new
residential construction earning both ENERGY STAR certification and a Home Energy Rating
Score (HERS) of 75 or less.
The Company's Energt Efficienqt 2019 Annual Report ("Annual Report"), attached as
Exhibit No. 1 and incorporated herein by reference, provides a review of Intermountain's EE
Program finances, cost-effectiveness, and performance by measure. It also reviews Program
activities and lessons leamed throughout 20L9 andoutlines future plans for the EE Program. Annual
Report at 2.
III. THERM SAVINGS
The second year of lntermountain's EE Program was one of growth and progress that
continued to build on the ovenvhelming customer response of the first year. For the year ending
December 3!,z}lg,the Company's EE Program achieved an estimated 466,651in therm savings
based on the original program assumptions for therm savings, incremental costs and estimated
useful life. The Company's first Conservation Potential Assessment ("CPA") completed in mid-
2019 modified the program assumptions and resultedn al7% decrease in therm savings to 389,313
therms. By either measure, these energy savings exceeded the second year therm savings target of
140,116 therms established in the Company's lntegrated Resource Plan ("IRP") in Case No. INT-G-
17-04. Annual Report at 1,8.
AppucarroN - 5
A total of 3,335 high-efficient measures were rebated to Intermountain residential
customers, representing a6l% increase over the previous year. The biggest driver of therm savings
was the 95% AFUE Natural Gas Furnace energy efficiency rebate. Annual Report at l.
ln June 2020, Intermountain was recognized by the U.S. Environmental Protection Agency
with an ENERGY STAR Certified Homes Market Leader Award, for "outstanding commitment to
energy-efficient new homes and for contributing 1,079 ENERGY STAR certified homes in2019".
Nine new residential home builders became ENERGY STAR certified builders in 2019 and
qualified for lntermountain's Whole Home rebate. The Whole Home rebate represented the second
highest level oftherm savings and enjoyed an increase in participationof 74%o over the previous
year. Annual Report at 1.
The Company is encouraged by the stong growth of the EE Program, and looks forward to
working with customers, the Commission, and other stakeholders to maximize the participation in
and the effectiveness of the EE Program going fonvard.
IV. REVENTIES
The EE Program expenditures are funded through collections from customers via the
Energy Efficiency Charge (EEC) of $0.02093 per therm. Total EE Program revenues for calendar
year2019 were$2,671,829. Annual Report at 5.
V. EXPEI\DITT]RES
EE Program expenditures from January 1,2019 through December 31, 2019 were
$2,803,346. Of this amount, $2,054,550, or approximately 73Yo, is related to energy efliciency
rebates paid directly to customers. Annual Report at 5.
ApplrcerroN - 6
In addition to the amount spent on energy efficiency rebates, the Company incurred an
additional $748,796 of EE Program expenses for labor, program delivery conservationpotential
assessment, and market transformation. Annual Report at 5. These expenditures were a critical
factor in the tremendous success the Company's EE Program has enjoyed in its first two years.
VI. DEFERRAL BALAI\CE
As previously discussed, the Company implemented an adjustnent in the EEC to fund
increased program expenses and reduce the defenal balance of $1,097,907 accrued through June 30,
2019. Due to the change in the EEC, Intermountain had begun to erode the deferral balance
resulting in an under collected balance of $442,387 at the end of 2019. Annual Report at 5. The
Company believes the curent rate will be sufficient to continue to reduce the rider balance and
allow for program growth. Because of this, Intermountain does not plan to file to adjust the
residential EEC n2020.
VII. AVOIDED COSTS
While the Commission found the2017-2018 Program expenses to be prudently incurred in
CaseNo. INT-G-19-04, OrderNo. 34536,it also directed "the Company and its EnergyAdvisory
Group to review the Company's avoided cost calculations concurrently with the EM&V study''. Id
at5
Intermountain invited interested members of its EESC to join an Avoided Cost
Subcommittee ("subcommittee") that would address the avoided cost issues raised in Order No.
34536. Annual Report at 7. The Subcommittee met three times between February and June 2020.
Minutes from the Subcommittee meetings are attached as Exhibit No. 2 and incorporated by
reference. The Subcommittee agreed upon a method for calculating avoided commodity and
AppucerroN - 7
transportation costs but could not agree on a method to account for avoided distribution costs. The
proposed Avoided Cost Calculation, as illustrated in Exhibit No. 3, includes avoided commodity
and hansportation costs and leaves a placeholder for potential inclusion of disfibution costs in the
future. Exhibit No. 3 is attached and incorporated by reference. The Subcommittee agreed to
continue to discuss options for addressing avoided distribution costs.
The Company plans to update the Gas Transportation Costs included in the avoided cost
calculation annually with its Purchased Gas Cost Adjustment ("PGA") filing. The Commodity
Costs will be updated as part of the IRP planning cycle, and an updated avoided cost calculation
will be filed as an exhibit in the IRP.
VI[. COST EFFECTTVENESS
Intermountain reports the cost effectiveness of its EE Program based on two industry
standard metrics: the Utility Cost Test ("UCT") and the Total Resource Cost ("TRC"). The UCT
measures cost effectiveness from the utility company's perspective and takes into consideration
avoided supply costs, program administation costs, and incentives paid by the utility. The TRC
measures cost effectiveness from the customer's perspective and focuses on avoided supply costs,
program administration costs and net participant costs. Although both are common industry metrics
for measuring cost effectiveness, the Company relies more on the UCT because it measures the
cost-effectiveness of items directly under the Company's control.
As previously discussed, the Avoided Cost Subcommittee agreed upon a new avoided cost
methodology for use in lntermountain's Energy Efficiency Program planning and evaluations. The
agreed upon avoided costs, as ouflined in Exhibit No. 3, have been used in all cost effectiveness
tests included as part of the Annual Report. Annual Report at 7.
Appt rclrroN - 8
The Company also commissioned its first CPA which was completed in 2019. The CPA,
which was filed as Exhibit No. 4 of Case No. INT-G- 19-07 , provided updated assumptions for
therm savings, incremental costs, and estimated useful lives for progr:Im measures. Applying the
updated CPA assumptions resulted in changes in the cost effectiveness of all measures. The
assumptions used prior to the completion of the CPA ("Pre-CPA") for program planning resulted in
an overall program cost-effectiveness of 1.06 when measured by the UCT. After updating to the
CPA assumptions ("Post-CPA"), the program UCT was no longer cost-effective at 0.87. Annual
Report at 9.
The CPA, along with the soon to be completed Evaluation, Measurement and Verification
(.'EM&\f ') study will be valuable tools in bringing the progftIm back to cost effectiveness in the
future.
IX. STAKEHOLDER MEETINGS
The Energy Efficiency Stakeholder Committee has been a valuable resource for the
Company as it builds the EE Program. As outlined on Page 35 of the Annual Report, Intermountain
hosted two EESC meetings. The meetings have included good representation from a variety of
groups including representatives from the Commission Staff, the Governor's Office of Energy and
Mineral Resources, and the Idaho State Department of Building Safety. Home energy raters
representing both sides of the state attended, as well as builders and HVAC professionals.
The May 2019 meeting focused on the results of the Company's CPA. A representative of
Dunsky Energy Consultants presented the CPA findings. The Company also provided a program
update.
The EESC met again in October 2019. The Company sought input on its planned EM&V
study. Intermountain also discussed preliminary plans for revisions to its residential program as well
Appr,rcerIoN - 9
as providing a brief overview of lntermountain's participation with Gas Technology Institute.
Meeting minutes for both EESC meetings are included in Exhibit No. 2.
x. EVALUATION, MEASUREMENT & VERIFICATION
In Order No.34536, the Commission found it "reasonable to direct the Company to
commission a third-party EM&V study for all EE Program incentives". Intermountain sent Requests
for Proposal to a number of consultants in early 2020 and from the replies, selected ADM
Associates, Inc. ("ADM") to perform an EM&V impact evaluation on the fumace and whole home
rebates. Because the remaining water heater and fireplace rebates had low participation and the
Company was already plaruring to revise those offerings based on the results of the CPA, the EESC
agreed that it made sense to exclude them from the2020 EM&V study. The Company also
requested that ADM perform a process evaluation ofprogram delivery.
The results of the EM&V study are nearly complete and will be shared with the EESC at a
meeting this fall.
XI. MODIFIED PROCEDT]RE
Intermountain requests that this matter be handled under modified procedure pursuant to
Rules 201-204 of the Commission's Rules of Procedure. lntermountain stands ready for immediate
consideration of this matter.
Appr.rcerroN - 10
)ilr. REQTIEST FOR RELIEF
Intermountain respectfully petitions the Idaho Public Utilities Commission as follows:
a. That the Commission issue an order designating $2,803,346 of 2019 Energy Efficiency
expenditures as prudently incurred,
b. That this Application be heard and acted upon without hearing under modified procedure,
and
c. For such other relief as this Commission may determine proper herein.
DATED: September l*, 2020.
INTERMOUNTAIN GAS COMPANY Givens Pursley LLP
BY flfrMltM By ,P A-"f::-
Lori A. Blattner
Director - Regulatory Affairs
Preston N. Carter
Attorney for lntermountain Gas Company
Appt tc,c.floN - 1l
DfiIIBIT NO. 1
CASE NO. INT-G.20.06
INTERMOT]NTAIN GAS COMPANY
Energy Efficiency 2019 Annual Report
(44 pages)
A INTERMOUNTAIN'6CAS COMPANY
Energy
Efficiency
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INTERMOUNTAIN GAS COM PANY
Energy Efficiency Annual Report
TABLE OF CONTENTS
Fxecutive Su
fanccnratinn Pntcntill Accaccmant
Frrrnace lnre 10
- Lessons Learned I Combi Radiant Heat System lncentive *-**--12
Firenlace lnce
Wetar Heatar lnvcentivp
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-- Lessons learned l, Water Heater lncentive --- - - 15
Tankleq< Water lnrcntirra 15
_---- Lessons Learned J Mive,-_L6
\A/hnla Hnma I 1R
Home Builders
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32
Stakeholder lnout 2E
6
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Market Transformation -- *-- 36
The Futrlre 1R
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LIST OFTABLES
Toble ). Progrom Cost-effeaiveness Pre-CPA ___8
Iohle 3. Co-st-Ffleaiveness Cornporison _ _ :- *9
Toble 4. Fumoce lncentive 10
Tohle T.Comhi Radiont Heot System lncentive lnfrt Comporison ___* L2
Tahle 8.7ff/" Firelloce lncentive _... ____- _ "13
Tohle 9. 70o/o Firefloce lncentive lnput Compoison ___ _ 13
Toble l1.Woter Heoter lncentive
Tohle l3.Ton4essWoter Heoter lncentive lnfitComlorison ,___ 15
Toble l4.Whole Home lncentive 1R
LIST OF FIGURES
Figure 9.Where Customers Go FirctWhen Needing EF lnformotton __ -f-7
Figure l0 EEDigjtolBonnerAds -.*_U
Figure 13. E|HBAb,ilder's Ex{,o Event -- . .-..)6
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Fjgure -17. HVAC Controaor Portol 30
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Figure l9.HVACCourseithsidyMoiling _,_ __ 31
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The second year of the lntermountain Gas Company's
Energy Efficiency Program (lntermountain, IGC or
Company)was one of groMh and progress that continued
to build on the overwhelming customer response of the
first year of the Energy Efficiency Program (EE Program or
Program). lntermountain increased customer outreach
and education efforts by both adding energy efficiency
team members and diversifying outreach methods.
lntermountain also commissioned the first conservation
potential assessment (CPA). lncreased outreach resulted
in growth in customer participation in the Program,
and the CPA provided the basis for Program fine-tuning
and the development of future Program offerings. The
portfolio was comprised of two main categories of
offeri ngs: high-efficient applia nces and construction
of ENERGY STAR certified homes. The high-efficient
appliance rebate offering focused on three groups: Space
Heating, Fireplace lnserts, and Water Heating.
ln 2019, both therm savings and the total number
of rebates paid to residential customers increased
over the previous year. A total of 3,335 high-efficient
measures were rebated to lntermountain customers,
aGLo/o increase over the previous year. The increase
in Program participation was shared across the five
districts in the Company's service area. This success was
largely attributed to increased outreach and education
efforts achieved by incorporating energy efficiency as
a portion of the job responsibilities of Energy Service
Representatives (ESR) stationed throughout the service
territory. lncluding energy efficiency in the suite
of benefits the ESRs present to customers allowed
lntermountain to increase energy efficiency outreach
and enhance the customer connection as'bne-stop-
shopping" when discussing energy efficient solutions
simultaneously with natural gas service options.
ln June 2020, lntermountain was recognized by the U.S.
Environmental Protection Agency with an ENERGY STAR
Certified Homes Market Leader Award, for'butstanding
commitment to energy-efficient new homes and for
contributing 1,079 ENERGY STAR certified homes in
executive summaty
lntermountain Gas ComPanY
Executive Summary
20L9
2OL9: lntermountain continued to build on this success,
quite literally, as nine new residentialhome builders
became ENERGY STAR certified builders and the Whole
Home Rebate had one of the largest increases of allthe
rebates offered. Whole Home rebates increased 74Yo ovet
last year, for a total of L,O79 ENERGY STAR certified homes
in 2019. The greatest number of rebates were furnace
rebates, with an increase of 55% over last year, while the
tankless water heater rebate had a significant increase
of 8LYo, and the 7l%FEfireplace increased by 8%. Two
measures underperformed when compared to last year:
the tanked water heater (11% decrease in participation),
and the 80% AFUE fireplace (no rebates redeemed).
While the first two years of the Program exceeded therm
saving targets and had an enthusiastic response from
customers, lntermountain took steps to improve the
Program based on performance, customer feedback,
guidance from the Stakeholder Committee and oversight
from the ldaho Public Utilities Commission. To better
identify therm saving opportunities and inform Program
planning, the Company completed its first conservation
potentialassessment in mid-2019. In addition to
identifying savings potential for the Program, the CPA
resulted in necessary modifications to the measure
inputs: therm savingt incremental costs and estimated
useful !ife, to varying measures and by varying degrees.
Intermountain used both Pre-CPA inputs and Post-CPA
inputs to calculate 2019 annualtherm savings and cost-
effectiveness tests for this annual report. When CPA
inputs were applied to estimated annual therm savings
calculations, it resulted in a decrease of approximately
L7Yo,from466,65Ltherms to 389,313 therms. The CPA
inputs were also applied to the Utility Cost Test. The Pre-
CPA Program benefit-to-cost ratio of 1.06 changed to 0.87
Post-CPA. All individual measures and overall Program
therm savings and cost-effectiveness tests are reported
using both the original Program measure inputs, or Pre-
CPA, and Post-CPA updates. The specific CPA updates,
resulting impact on estimated therm savings and cost-
effectiveness are presented by measure as well as for the
overallProgram.
executilre surn flary
From the start of the Program on October t,2OL7 through
June 2O 2019 the Energy Efficiency Charge rider funds
totaled, 5!,7L2,654. For the same time period, program
expenses were 52,810,560,77yo of these expenses were
paid directly to customers in the form of rebates, resulting
in an uncollected balance of 51,097,906. ln August of 2019,
in order to continue to allow all interested customers to
participate in the Program and to continue to grow the
Program, lntermountain filed an Energy Efficiency Charge
change request, Case No. INT-G-19-05, to increase the Rate
Schedule EEC per therm rate from SO.OOgez to 50.02093.
The request was approved in Order No. 34454, with an
effective date of October L,2O!9. As of December 2019, the
I ntermou nta i n Energy Efficiency Progra m deferral ba la nce
was under-collected by 5M2,387.
To build on the success and momentum established in the
first program year, lntermountain repeated and expanded
on successful outreach activities and continued to focus
on three target audiences: customers, contractors (HVAC
contractors and home energy raters), and home builders.
lntermountain applied lessons learned, program
performance, and participant feedback to shape the
strategy and administration of the second program year.
lntermountain again utilized traditional outreach and
education methods such as bill inserts, social media and
the energy efficiency website pages to promote energy
efficiency to customers and community alike. To expand on
this outreach strategy, lntermountain conducted a first-time
radio and digital media campaign in combination with the
annual customer energy efficiency bill insert and engaged
lntermountain customers in an energy efficiency survey.
To raise awareness about home energy efficiency and the
benefits of an ENERGY STAR certified home, a two-year
special community partnership with Boise Valley Habitat for
Humanity (BVHFH) culminated on Earth Day 2019 with the
completion of the 2019 Habitat for Humanity ENERGY STAR
certified home. The project was celebrated with an official
ribbon cutting ceremony and the first ever BVHFH open
house which was open to the community.
I ntermou nta i n frequently received feed back f rom
contractors about the straightforwardness of the Program
requirements and of the application itself. A frequent
request was the need for an online application. To keep
things simple and easy to access, in October of 20L9,
lntermountain launched both a contractor portal as a
one-stop resource for contractors, and an online rebate
application. ln just three months'time, 245 rebates were
processed utilizing the online form, streamlining both the
application process for users and internal rebate processing
for the Company.
lntermountain is focused on energy efficiency today,
but also looks forward to an energy efficient future. ln
December 2019, lntermountain joined the North American
Gas Heat Pump Collaborative (Collaborative), a workgroup
of 16 utilities representing over 27% of all North American
residential customers. The mission of the workgroup is
market transformation, or more specifically, to accelerate
the adoption of natural gas heat pump technologies with
potentialto bring new energy saving opportunities to
customers and reduce greenhouse gases. Participation in
the Collaborative builds upon the Company's involvement
in the Emerging Technology Program (ETP), fucilitated by
the Gas Technology lnstitute (GTl).
The Energy Efficiency Stakeholder Committee met in the
spring and fall of 20L9, in Twin Falls and Boise respectively.
The group provided valuable insight from a variety of
ind ustry perspectives (contractor, bu i lder, regu lato ry a nd
environmental) and provided guidance regarding all aspects
of the Program including performance and future plans for
the Program.
This Energy Efficiency 2019 Annual Report provides a review
of lntermountain's Energy Efficiency Program finances, cost-
effectiveness and performance by measure. lt also includes
Program activities and lessons learned throughout 2019
and outlines future plans for the EE Program.
)
infioduction
lntermountain Gas Company
lntroduction
20L9
lntermountain Gas Company, a subsidiary of MDU
Resources Group, is a naturalgas distribution company
serving a pproximately 375,885 residential, commercial
and industrial customers in 76 communities across
Southern ldaho since 1955.
ln addition to providing customers warmth and comfort in
the cleanest, safest and most affordable way possible, the
Energy Efficiency Program specifically strives to provide
customers opportunities to learn and engage as energy
efficient consumers, to minimize waste and maximize
resources, to be good stewards of the environmen!
and ofcourse, to save money. Beyond the benefits
provided to individual customers through participation
in the Energy Efficienry Program, allof the Company's
customers benefit from the efficient use of natural gas.
Efficient use of resources delays the need for expensive
system upgrades while still providing customers with safe,
reliable, and affordable service.
Approved by the ldaho Public Utilities Commission
in Order No. 33388, the Program went into effect on
October L,201-7. The Company began its efforts to
pursue cost-effective energy efficiency in the form of
natural gas savings by creating an energy efficiency rebate
progmm. The Energy Efficiency Program was offered to all
customers receiving natural gas through IGC's Residential
Rate Schedule. The Program offers rebates on naturalgas
equipment meeting specific high efficiency requirements,
and can be applied to replacement equipmen!
conversion from other fuel sources and new construction.
The Program also offers rebates for new construction
homes that meet two complementary home energy
efficiency measures: qualifying for the EPAt time-tested
ENERGY STAR Certified Home Program, combined with a
HERS (Home Energy Rating System) lndex of 75 or less.
The EE Program is funded by the Energy Efficiency Charge
(EEC) rider. The initial plan to acquire cost-effective
therm savings with the allocation of 5777,OOO in annual
rider funds, was quickly exceeded in each of the first
two years of the Program due to the enthusiastic level
of customer participation to save energy and money. ln
order to allow all interested customers to participate in
the Program, the Company carried the balance of under-
collected funds and began 2019 with an under-collected
defenal balance of 5310,870. ln anticipation of continued
customer interest in pursuing energy saving measures,
the Company requested an Energy Efficiency Charge
revision, Case No. INT-G-19-05, to increase the per therm
rate on Rate Schedule EEC from 50.00367 to $0.02093.
This change was estimated to result in a monthly
increase of approximately S1.07 for the Wpical residential
customer. The request was approved in Order No. 3rt454,
with an effective date of October L,2OL9. Additionally, all
expenses through 2018 were deemed prudently incurred
by the ldaho Public Utilities Commission in Order No.
34536, Case No. INT-G-19-04.
Despite the increased EEC, customer participation in the
Program continues to outpace the plan resulting in an
under-collected balance of 5M2,387 at the close of 2019,
with73% of fund expenditures paid directly to customers
in the form of rebate incentives (see Table 1).
4
introduction
B_.-
$
$:'v,.t:
*.
Y
!)
Residential Energy Eff iciency Rebates
Labor
Program Delivery
CPA
Market Transformation
777,OO0 2,903,346lProgram Eltpenses
Revenue $
$442,s
(131,5 16I
777,W0 $ ?,67L,829
310,870)
Collection
Ove ColleetionUnde
m Expenses
2019 Rider Deferral
Rider Account Balance
2,054,550
497,726
44,348
195,722
11,000
600,0m
147,000
30,000
Prior Year Rider Balance
Urerl(Under! Collection
20 l9 Plan to Actual ComPerison
ActualPlan
(Toble L 20 I 9 Plon to Acturol Comporison
introduction
Conservation Potential Assessment
lntermou ntain intentiona I ly designed the initia I progra m
to be a modest offering to allow for proper ramp up and
promotion of the new Program. Based on the positive
response to the initial offering, lntermountain took the
next steps in the evolution of the program to refine
and expand cost-effective energy saving opportunities.
The first CPA was completed mid-2019. CpA expenses
were spread over two program yeart 548,997 in 201g
and 5195,722 tn ZOLS for a total cost of 52214,709. The
purpose of the CPA was to conduct a more robust analysis
of all cost-effective measures to support both short-
term energy efficiency planning and long-term resource
planning activities. More specificalty the CpA study:
. ldentified opportunities: assessed achievable Demand
Side Management (DSM) opportunities to lmprove
EE Program planning and help identify long-term
savings objectives, and determined which sector,
end-uses and measures hold the most potential. The
study resulted in Technical, Economic, and Achievable
potentialtherm savings forecasts which served as an
input into lGCt lntegrated Resource plan.
. lnformed Energy Efficiency program planning:
portfolio and program design considering funding
level, market readiness and other constraints
The CPA study, in conjunction with the findings of the
Evaluation, Measurement and Verification (EM&V)to be
conducted tn2O2O, willbe applied to refine, expand and
grow the lntermountain EE program. lntermountain will
seek input from the EE Stakeholder Committee regarding
any changes or additions to the residential offering.
Conservation potential of the commercial market was
also provided in the CPA. lntermountain will use this study
to design a commercial offering and will follow the same
process of consulting with the EE Stakeholder Committee
on the design of a commercial offering. The CpA was filed
as Exhibit 4 of Case No. |NT-G-19-07.
6
The Company calculated the results of the EE Portfolio
using both Pre and Post-CPA measure inputs of
measure therm savings, estimated useful life (EUL), and
incremental cost. lntermountain is including the initial
Program design measure inputs, or Pre-CPA, as this was
the most complete information known at the start of the
program year (the CPA was not completed until mid-
2Ot9). Details of the re-calculated therm savings and cost-
effectiveness tests after applying CPA inputs (i.e. Post-CPA
results) are provided as well as comparisons of Pre and
Post-CPA results.
I ntermou ntai n measu red the cost-effectiveness of
the Energy Efficiency Program portfolio based on two
industry standard metrics, the Utility Cost Test (UCI) and
Total Resource Cost (TRC). Although both metrics are
commonly used for measuring cost-effectiveness, the
Company relies more on the UCT because it measures the
cost-effectiveness of items directly under the Company's
control.
The UCT measures cost-effectiveness from the utility
company's perspective and takes into consideration
avoided supply costs, program administration costs,
and incentives paid by the utility. The TRC measures
cost-effectiveness from the customer's perspective and
focuses on avoided supply costs, program administration
costs, and net participant costs. For both the UCT and
TRC, a benefit-to- cost ratio of 1.0 or above indicates that
the benefits have exceeded the costs.
Although the Commission found 2OL7-20L8 expenses to
be prudently incurred in Order No. 34536, it also ordered
that lntermountain review the avoided cost calculation
and develop a plan to establish an avoided cost
methodology. lntermountain formed an Avoided Costs
Su bcommittee (Subcommittee), specifi cally dedicated
to addressing avoided cost methodology. This group
reviewed and advised on an avoided cost calculation' The
Subcommittee agreed on a methodology for calculating
avoided costs related to commodity and transportation
costs. At the time of this writing, the group had not
agreed upon a way to quantify avoided distribution costs'
energy eficiency Programs
lntermountain Gas ComPanY
Ene rgy EfficiencY Programs
20L9
While the new avoided cost methodology makes cost
effectiveness tests more challenging, the Subcommittee
conducted a thorough review and will continue to work
toward a methodology that includes avoided distribution
costs. The avoided cost calculation developed by the
Avoided Cost Subcommittee is used to analyze cost
effectiveness of the program in this report.
fl
,iffi.:,i;,,''
7
energy efic,encypfwams
Energy Effi ciency Portfolio
The Pre-CPA Energy Efficiency Program portfolio achieved an estimated annua! savings of 4G6,651therms, exceeding
the initial Program year 2goal of L4O,LLG therms. The portfolio was cost-effective under the UCI at 1.0G but did not
pass the TRC cost-effectiveness test ato.37, which is reflected in Table 2.
Toble 2. Progmm GsGEflbctil€ness Pre-CPA
The 95% AFUE furnace provided the greatest therm savings, contributing 4gyo of totalannual savings, followed by theWhole Home new construction, tankless water heater, combination radiant heat system ,TOyotEfiieplace insert, and0.67 UEF tanked water heater measures. There were no 80% AFUE fireplace rebates redeemed and therefore it did not
contribute to total therm savings. These results are reflected in Figure 1.
20 I 9 ANNUAL THERM SAVI NGS
Pre-CPA Results
r 95% AFUE Furnace
r.91 UEFTANKLESS WATER HEATER
I Whole Home Package
B 90% AFUE Radiant Combo
a 70% FE Fireplace lnsert
I ,67 UEF WATER HEATER
r 80% AFUE Fireplace lnsert
8
Program Cost-Effectiveness Pre-C PA
Cost Test Benef its Costs BenefitlCost Ratio
Ftgure l. 20 I 9 AnnuolTherm Soings
UCT Benefits S
UCT Costs S
UCT Benefit/Cost Ratio
(512,320)
(0.le)
s
s
RatioTRC Ben
2,449,525 s
2,803,345 s
o.87
2,951,945 s
2,803,345 s
1.06
(512,320)
(1,954579)
o.03
7,449,625 s
5,052,850 s
0.40
2,961,945 s
I 017,539 s
0.37
Benefits
Costs
Cost-Effectiveness C onr Pari son
Net Change
lncrease/(Decrease)Post-CPAPre-CPA
energy efi ciency Prografi s
After applying the CpA inputs of therm savings, measure life, and incremental cost, total estimated annual therm
savings decreased from 466,G51to 389,313 therms. Under this scenario, the whole home measure contributed the
largeit percentage of therm savings, instead of the furnace incentive. The cost-effectiveness of the portfolio under
the UCT decreased from 1.06 to 0.87, while the TRC ratio increased from 0.37 to 0.40. The Program UCT calculation
of cost-effectiveness decreased from Pre-CPA to Post-CPA due to the fact the annual therm savings of four of the six
measures in the offering were reduced, reducing the total Program benefits from $2,961,945 to $2,449,625.These
updated calculations are reflected in Table 3. Specific input changes and the subsequent impact on cost-effectiveness
are presented for each rebate offering.
Toble 3.Comporison
Based on the post-CpA cost-effectiveness tests, Program offerings will be revaluated. tntermountain will review the
appropriateness of current offerings and incentive levels for each offering. lntermountain will use the CPA results to
identify rebates that can be re-designed or new measures that can be included in the Program. The Company will work
with its Stakeholder Committee to refine the residential Program based on the CPA results.
Details regarding performance, cost-effectiveness and lessons learned are all presented by individual measure in the
following sections. Both pre-CpA and Post-CPA cost-effectiveness tests are provided as well as the change in measure
inputs.
9
efieryy efrciency Progrufis
Furnace lncentive
The furnace incentive (furnace) provides customers a S3SO rebate for the installation of a high-efficient natural gas
furnace with a minimum efficiency rating of 95% AFUE or greater. lntermountain issued 2,065 furnace rebates during
20L9, a 55% increase over the prior program year. The Pre-CPA estimated annual therm savings attributed to the
furnace incentive totaled 23L,392and was cost-effective with a UCT of 1.15 but was not cost-effective under the TRC at0.4L.
After applying the CPA inputs, the furnace rebate cost-effectiveness under the UCT decreased from 1.15 to 0.97. The
Post-CPA UCT was just under the cost effectiveness taryet of 1.0 at 0.97 and was not cost-effective based on TRC.
Toble 4. Furnoce lncentive
The following table outlines the change in the furnace measure inputs Pre and Post-CPA. Estimated annual therm
savings per furnace were reduced from 112 therms to 86 therms and the estimated useful life was reduced by one year,
while the incremental cost remained unchanged.
Therrn Savings
Bebates lssued
UCT
231,392
2,056
1.15
o.4l
177,676
2,966
4.97
o.35
(53,716)
(0.18)
Net Change
lncrease/(Decrease)
Furnace lncentive
Pre-CPA Post-CPA
lncrernentalCost ($l
Estimated UsefulLife
112
t,307 s
2L
(25)
(1)
86
s
20
1,307 s
Savings (Therms)
Furnace lncentive lnput Conrparison
Net Change
lncrease/(Decrease)Pre-CPA Post.CPA
10
Table 5. Furnoce lncenlve lnput Compoison
Rehates lssued
UCT
TRC
4,96L
11
1.58
o.56
1,243
11
o.55
o.19
(3,718)erm Savings
(r.o2)
(o.3
Con'rbi Radiant Heat Systenr lncentive
Net Change
lncrease/(Decrease)Pre-CPA Post-CPA
energy cftcieacy ptogams
Lessons Learned I Furnace lncentive
HVAC contractors continued to play a key role in the awareness and performance of the furnace incentive because
they are with the customer at the point of decision and have an opportunity to educate and promote the benefits of
choosing a high-efficient option. lntermountain will continue to focus on growing HVAC contractor participation in the
EE Program through outreach and providing contractor resources.
Rebates for furnace retrofits made up the majority of the 2,066 rebates, while new construction rebates accounted
for L7%of furnace rebates. Builder participation in appliance rebates continued to increase as new construction only
accounted for 7%of furnace rebates in the previous year. The Company will continue to promote appliance rebates
with builders as a first step to incorporating energy efficiency measures into new construction.
Combi Radiant Heat System lncentive
lntermountain offers a S1,000 rebate for the installation of agOo/oor greater efficiency condensing tankless combination
system for space and water heat (combi radiant heat system). lntermountain issued 11 rebates for the combi radiant
heat system during the 2019 program year, an increase from 3 rebates issued during the prior progEm year. The Pre-
CpA estimated annualtherm savings were 4961therms, and the combi radiant heat system was cost-effective with a
UCT of 1.58 but was not cost-effuctive under the TRC at 0.56.
post-CpA estimated annualtherm savings decreased by 3,718 therms causing a significant reduction to the UCI and TRC
ratios. The UCI decreased from cost-effective at 1.58 to not cost-effective at 0.55, with the TRC ratio decreasing from
0.56 to 0.19.
Toble 6.Combi Rodiont Heot Sptem lncenave
11
ener gt efi cierrcy pt ogrum s
The combi radiant heat system experienced the greatest reduction in estimated per measure annualtherm savings of
all the EE Program offerings when updated with CPA results. While the estimated useful life increased by one year, the
incremental cost increased significantly.
Toble 7. Combi Rodiont Heot System lncentfue lnput Compoison
Lessons Learned I Combi Radiant Heat System
The combi radiant heat system incentive experienced a significant percentage increase, but actuat uptake was still quite
slow from 3 rebates in 2018 to 11in 2019. A contractor suggested exploring a boiler rebate because a home with a
radiator system for space heat cannot utilize this incentive since the water cannot be used for both space and water
heating. Based on lessons learned and Post-CPA results, the viability of this measure will be reviewed.
Fireplace lncentive
lntermountain provided two high-efficient fireplace incentive options: a SfOO rebate for the installation of a7O%FE
or greater natural gas fireplace insert (70% fireplace), and a 5200 rebate for the installation of an 80% AFUE or greater
natural gas fireplace insert. There were no qualifying applications for the 80% AFUE Fireplace tnsert incentive. Due to
continued lack of availability in the market and Commission apprornl, !ntermountain discontinued this rebate in 2020.
lntermountain issued 14 rebates for the 70%fireplace incentive during the 2019 program year, an 8% increase over the
number of rebates issued the prior progmm year. Pre-CPA estimated annual therm savings were 784 therms and the
measure was cost-effective with a UCT of L.T2butwas not cost-effective under the TRC at 0.64.
The 2019 annual therm savings attributed to the 70% fireplace decreased drastically from784to 140 therms after
incorporating the CPA inputs. Based on UCT calculationt the fireplace is no longer cost-effective with a benefit-to-cost
ratio change from L.72 to 0.49. The fireplace incentive was not cost-effective under either scenario based on TRC ratios
of 0.64 and 0.47.
12
Annual Savings (Thermsl
lncrementalCoat (51
Estimated Useful Life (Years)
451
2,500 $
2\
113
3,522 $
22
(338)
1,o22
I
$
Conrbi Radiant Heat Systenr lncentive lnpur Comparison
Net Change
lncrease/{Decrease }
Pre-CPA Post-CPA
errer gt efr ciefl cy Pf ogr
^rn
s
Toble 8.70% FirePloce lncentive
The incremental cost of a7O%fireplace decreased significantly from S4Z5 to St07 and the estimated annual therm
savings per measure decreased from 56 to 10 therms after incorporating the CPA results. The estimated useful life of the
measure was unchanged.
Toble 9.70% Fireploce lncenilve lnput Compoison
Lessons Learned I Fireplace lncentive
Despite offering the 80% AFUE fireplace another year, it further proved to be an emerging technology that would not
emerge in the Intermountain market. The requirement for a condensate line for installation of this equipment created a
significant barrier to adoption. For this reason, the offering will be discontinued in 2020.
ThelO%fireplace incentive experienced a modest increase. The typicalfireplace insert is designed and installed
primarily as a decorative element, rather than as a heat source. As fumilies mature and children leave the nest,
"empty-nesters" often use the decorative fireplace insert as a supplemental heat source. Rather than heat the entire
home, inserts are used to heat a single room. The typical appliance itself is not designed to be a heat source and use
of the fireplace insert in this way is particularly inefficient.TheT}%fireplace is a more efficient option, providing both
decorative aesthetics and modest savings. Based on the lessons learned and Post-CPA results, this measure offering will
be reviewed.
13
784
14
1.72
o.64
140
14
o.49
o.4v
(6a+1
(1.23)
(o.17
Rebates lssued
UCT
Savings
7 A% Fireplace I ncentive
Net Change
lncrease/(Decrease )
Post-CPAPre-CPA
lncremental Cost {$}
Estimated UsefulLife
10
107
20
(45)
(3181
55
ss
20)
42s s
nualsavings (Therms)
7A% Fireplace lncentive lnput ConrParison
Net Change
lncreasef (Decrease)Pre-CPA Post-CPA
eflergy efr cieficy prograrns
Water Heater lncentive
lntermountain offered a S50 rebate for the installation of a 0.67 UEF water heater (water heater). The Company issued 8
water heater rebates during the 2019 progrcm year; an 11% decrease compared to the number of rebates issued during
the prior program year. The Pre-CPA cost-effectiveness for this measure under the UCT and TRC was 1.30 and 0.29,
respectively.
Cost+ffectiveness tests for the water heater rebate after applying CPA inputs were relatively unchanged. Cost-
effectiveness ratios increased slightly under the UCTfrom 1.30 to 1.34 and the TRC ratio increased from 0.29 to 0.36.
Toble l1.Woter Heoter lncentive
The annual estimated per water heater therm savings increased by 15 therms after incorporating the CPA results.
Additionally, the incremental cost increased by S+f and the estimated usefulfellfrom 16 to 13 years.
L76
I
1.30
o-29
304
I
L.34
o.36
128erm savings
o.04
o.o7
Rebates lssued
UCT
Water Heater lncentive
Net Change
lncrease/{Decrease}Pre-CPA Post-CPA
lncrementalCost ($!
Estimated Useful Life
22
34s s
16
15
41
38
S
13 3
3eo s
nualSavings (Therms)
Water Heater lncentive lnput Conrparison
Net Change
lncrease/(Decrease)Pre-CPA Post-CPA
14
Table I l.Water Heoter lncentire lnput Comporison
Rebates lssued
UCT
TRC
9,222
159
1.30
o.22
10,335
159
1.58
o.23
1 1 13,erm Savings
o.28
o.o1
Tankless Water Heater lncentive
Net Change
lncrease/(Decrease)Pre-CPA Post-CPA
enetgy eficiency progrants
Lessons Learned I Water Heater lncentive
To achieve a 0.67 UEF efficiency on a tanked water heater requires the appliance to have power venting. Depending
on the location of the water heater in the home, in addition to the cost of the equipment upgrade, installation of an
electric outlet may also be required. lnstallation challenges encountered in retrofit situations can likely be avoided
by incorporating a high-efficient water heater in the planning stages in new construction. The Company will explore
additional outreach and education opportunities with builders regarding this measure.
Tankless Water Heater lncentive
The Company offered a 5150 rebate for the installation of a 0.91 UEf;, or greater, condensing tankless water heater
(tankless water heater). lntermountain issued 159 tankless water heater rebates during the 2019 progrcm year,anBLo/o
increase over the prior program year. Under the Pre-CPA scenario, the tankless water heater incentive was cost-effective
based on the UCT of 1.30 but was not cost-effective with aO.22TRC ratio.
Post-CPA, the estimated annual therm savings for the tankless water heater increased to 10,335 and benefit-to-cost
ratios increased under both UCI, from 1.30 to 1.58, and TRC, fromO.22 to 0.23.
I 2.To r*l ex W ote r H eoter I n ce ntive
Like the tanked water heate[ the estimated annual therm savings per tankless water heater incentive increased after
incorporating the CPA results. Additionally, the incremental cost for the tankless water heater increased by 5440, and
the estimated useful life rose significantly from 18 to 25 years.
Toble I 3.TonklessWoter Heoter lncentive lnput Comporison
15
Annual Savings (Therms)
lncrementalCost ($)
Estimated Useful Life (Years)
75855
440s
71825
1,8OO s1,360 s
Tankless Water Heater lncentive lnput ComParison
PrE-CPA POSI-CPA NCt ChANgC
lncrease/(Decrease)
efi eryy efr cienc! progr$rfl s
Lessons Learned I Tankless Water Heater tncentive
The condensing tankless water heater increased significantly over the 2018 program yea[ mostty due to a home builder
which incorporated the tankless water heater into its build process. Although this measure does provide energy savingS
payback can vary greatly due to varying installation requirements particularly in retrofit situations. There are both
consumer and contractor education opportunities to explore regarding this incentive. Specifically, consumers need to
understand that the tankless water heater can be a good option for smaller spaces. Additionally, contractors need to
take into consideration the proper sizing, venting requirements and gas suppty issues when installing tankless water
heaters.
Whole Home lncentive
lntermountain offered a 51,200 rebate for residential ENERGY STAR certified new construction with a HERS score of 75
or less (Whole Home). lntermountain issued 1,079 rebates for the Whole Home incentive during the 2019 program year,
a74% increase over the prior program yeati The Pre-CPA estimated annual therms savings attributed to the whole home
incentive totaled 22O,LL6 therms. This measure was just under the benefit-to-cost ratio threshold of 1.0 with a UCT of
0.99, but was not cost-effective under the TRC at 0.35.
Post-CPA, the estimated annualtherm savings decreased trom220,LL6 therms to 199,615 therms, and neither UCT nor
TRC benefit-to-cost ratio was cost-effective.
Toble l4.Whole Home lncentive
Table 15 outlines the change in the Pre and Post-CPA inputs for the Whole Home incentive. Per measure estimated
annual therm savings decreased by 19 therms and the incremental cost decreased significantty from S+OOO to SZ,LLI
The CPA also reduced the estimated usefu! life from 30 to 25 years.
22O,L16
1,O79
o.99
o.35
199,615
1,079
o.80
o.52
(20,501)Savings
(o.1e)
o.17
Rebates lssued
uct
Whole Home lncentive
Net Change
lncrease/{Decrease}Pre-CPA Post-CPA
16
efieryy efuiency pfograrns
Toble I S.Whole Home lncentivt lnput Comporison
Lessons Learned I Whole Home lncentive
Twenty-four ENERGy STAR certified builders participated in the Program in 2019. Eighteen builders were repeat builders
established in 2018 and nine new builders earned ENERGY STAR certification in 2019. Three ENERGY STAR certified
builders from 2018 did not apply for rebates in 2019. Of these three builders, two were low volume builders of highly
custom project homes, and the third builder hced internal organizational restructuring.
Figure 2 ilustrates the geographical distribution of Whole Home rebates issued throughout the service area. While
pi-rticipation in all regions grew orer last year, the Treasure Valley continues to have the highest number of Whole Home
iebate participants. Other EE Program offerings showed participation in all districts, while the Whole Home incentive
participation lags and thrives by region.
ENERGY STAR REBATES BY DISTRICT
r Twin Falls
r ldaho Falls
I Nampa
I Boise
185
2,177 s
25
(1e)204
(s
30rs
4,fiI0 s
ualsavings tTherms)
lncrementalCost (Sl
UsefulLife
Wlrole Home lncentive lnput Conlparason
Net Change
lncreasef {Decrease}Pre-CPA Post-CPA
Figure 2.ENERGY SIAR Rebotes By Disuia
17
e ner gy efr ciency pr wfurfi s
Figure 3 below shows the distribution of HERS scores for ENERGY SIAR certified homes that participated in the Program
in 2019. While ENERGYSTAR home certification is straightfonruard (the home either meets the strict requirement for
certification set by EPAt ENERGY SIAR Certified Home program, or it does not), the HERS score offers a scale on which
to compare the energy efficienry performance of one home against another, much like a miles-per-gallon (MpG)
comparison of automobiles. !n the case of the HERS score, the lower the score the more energy efficient the home.
2019 HERS Score Distribution
lff)
160
140
I
o
J{
dUt
o
tou
llrr,r
67686€707r72fi 52 53 fl 55 55 57 5E 59 60 51 62 6ii il 65
According to the RESNET report, Trends in HERS Rated
Homes, L4o/oof one- and -two family new homes in ldaho
received a HERS score in 2019 based on permit data from
the U.S. Census Bureau. Of the L4To,or2,L2Lnew homes
recorded by RESNF[ lntermountain issued rebates to
1,079 of these homes under the Whole Home incentive.
The national average HERS score for 2019 was 59.
The average HERS score of homes rebated by
lntermountain increased to 53 during the 2019 program
yeat over the previous year's avemge of 51. On the
Frgure 3. HERS kore Disuibution
surhce, it may appear that the average HERS score is
moving toward less efficient and would be true in the
case of a singular home. !t is important to remember
both ENERGY STAR certification and the HERS score often
require a builder to change many aspects of the build
process. This includes the architect drawing up house
plans to training subcontractors on the direct application
of energy efficiency measures in the construction process.
To achieve a lower, more energy efficient, HERS score
requires significantly more investment of materials
or improvement of construction technique, andlor
18
expertise. For a builder just beginning to incorporate
above code energy efficiency measures into the build
process, setting the bar too high, or in this case the
HERS score too low as a participation benchmark can
prohibit participation. The jump from a code-based
home to an aggressively low HERS score can involve an
insurmountable number of changes. The addition of
more newly certified builders to the Program, who may
earn higher HERS scores as they learn the process, is one
possible explanation for the higher average HERS score in
20L9.
Both the overall number of homes earning ENERGY
STAR certification and the HERS score have increased,
as have the number of ENERGY STAR certified builders.
A particularly significant note about this growth is the
fact that one of the new builders participating in the
Program is a production builder. As defined by National
Association of Home Builders (NAHB), production builders
typically build homes priced for first-time and move-up
buyers. Participation in the ENERGY STAR certified home
program by a production builder is proof that home
energy efficiency is achievable at any price point, and
more importantly at a first-time buyer price point. One
of the most overlooked considerations in the energy
efficiency investment conversation, whether it be about
appliances or homes, is the difference between purchase
price and the price to operate. When the reduction in
long-term operating costs due to home energy efficiency
is also considered, an ENERGY STAR certified home, only
makes affordable housing more affordable. This builder is
also striving to earn the status of LOO% certified, meaning
every home built will be ENERGY STAR certified. There is
currently only one 100% certified builder in the state of
ldaho.
The Company identified several factors that it suspects
contribute to the regionality of participation in the
Whole Home incentive, best explained using a popular
real estate mantra: location, location, location. The
location of the growth in ldaho is primarily in the
Treasure Valley. The area with the largest growth in home
building, subsequently also has the greatest number of
ENERGY STAR certified homes. The location of ENERGY
STAR certified HVAC contractors and home raters is
another contributing factor, or in this case a barrier to
participation. At least two regions truly lack ENERGY STAR
certified HVAC contractors and home raters, and these
two areas also have the lowest participation. ln 2019,
lntermountain offered HVAC contractors a course subsidy
to offset ENERGY STAR certification training fees and will
continue to explore market barrier reduction strategies.
Finally, the building code in specific locations also plays
a role in whole home rebate participation. The building
code varies from jurisdiction to jurisdiction' ln regions
where the building code is less rigorous, meeting ENERGY
STAR certified home requirements requires more effort
by the builder. While there is potential to capture greater
energy savings in these areas, it will also require significant
education and outreach efforts. Where this is the case, the
appliance rebate incentive has been promoted to builders
as an introductory way to incorporate energy efficiency
in new construction. From 2018 to 2019, the number of
appliance rebates claimed by builders increased from 97
to 355, or a267% increase. lntermountain will continue
to build on these initial steps of incorporating energy
efficiency into new construction to eventually move
builders to a whole home aPProach.
19
2019 Pro$affi Outrctch, Auareness, and Eilucation
lntermountain Gas Company
Program Outreoch, Aworeness,
ond Education
2019
Energy Efficiency Team
To build on the success of the first year of the Program,
and continue to manage and grow the Program,
lntermountain also grew the energy efficiency team.
To best manage the growth and expansion of the EE
Program, the Company dedicated a program manager
full-time, a position previously split between the
Regulatory Department and Energy Efficiency. Even with
this modest expansion, the lntermountain service area
remained a large geographicalterritory to serve. The
Company explored severaloptions to help expand the
reach of the energy efficiency message to regions outside
the Treasure Valley.
Although the Company needed to grow the energy
efficiency staff, lntermountain decided not to hire any
additional positions to reside in the general office in
Boise, which would have required additional expenses to
travelto other regions in the service area. Although the
Company considered hiring additional positions to reside
in the district offices to solely deliver energy efficiency
responsibilities for that region, it ultimately implemented
a more efficient solution which provides benefits to
customers and the Company. ESRs are responsible for
supporting existing a nd prospective residential and
commercial customers, and routinely work with builders,
contractors, residentia I and com mercia I customers.
They are representatives of lntermountain Gas in their
respective communities, participating in the Building
Contractors Associations, Chambers of Commerce, civic
groups, and industry related trade shows. These are the
very same groups of customers and types of community
involvement the Energy EfficiencyTeam strives to
reach with its energy efficiency message. Rather than
duplicate efforts or require customers to contact different
departments for different but complementary serviceg
lntermountain is utilizing ESRs to provide customers a
one-stop-shop experience.
Since implementing this solution, the Company has seen
ESRs seamlessly incorporate energy efficient solutions
as part of lntermountaint service to its customers. tn
addition, through their daily connection to customers,
ESRs are more in tune to customer feedback about the EE
Program, can see developing trends, potential roadblock
to participation or beneficial program elements for the
Program to build on or expand. Customers, builders,
contractors or energy raters no longer must wait for
an energy efficiency team member to come to town,
since they can now access ESRs throughout the service
territory. Sharing these responsibilities has allowed the
energy efficienry team to better coordinate and focus
on energy efficiency outreach and promotion strategy,
develop marketing materials and outreach activlties, and
engage in energy efficiency industry related activities like
the ldaho Code Board meetings and emerging energy
issues.
The ESRs absorbed energy efficiency into their suite
of services to offer customers in June of 2019. lnstead
of adding two full-time energy efficiency analysts, the
Company instead added two ESR positions and the EE
Program now underwrites29%of each of the eight ESR
positions. The ESR and energy efficiency team regularly
share information about energy efficienry related issues,
including rebate performance, emerging trends, and
solutions to shared challenges. ESRs traveled to Boise for
a half-day training and team building event in August of
2019 which focused on both energy efficiency and energy
services matters.
20
2019 Progam Outreach, Awarcness, anil Education
Customers and the CommunitY
ln this second year, the EE Program focused on three major groups for outreach and education: customers, which
includes the community at large, contractors (both home energy raters and HVAC contractors) and home builders'
lntermountain used a variety of dynamic approaches to reach these three target groups.
IGC promoted energy efficiency to customers using social media platforms, including Facebook, lnstagram, Twitter,
and youTube. The Company also sends an energy efficiency program insert to new customers when they start service.
ln 2019, the Company sent 33,761 of these new customer energy efficiency inserts to raise awareness about the EE
program. Social media outreach efforts focused on energy efficiency tips, program promotion, and education. The
Company designed these posts to pique interest in rebates by highlighting customers receiving raffle prizes, featuring
information about rebates, highlighting home energy features on ENERGY STAR certified homes, and promoting
opportunities to visit ENERGY STAR certified homes. The U.S. Environmental Protection Agency recognized the EE
program as an ENERGY STAR Market Leader for its contribution to the construction of t,O79 ENERGY STAR homes in the
2019 program year.
To expand the reach and awareness of the Energy Efficiency
Program, lntermountain explored ways to promote the
Program outside of a bill insert, Facebook posts, or passively
waiting for information seekers to stumble across the energy
efficiency website. Instead, lntermountain engaged in a
search engine optimization experiment using YouTube and
Google Ads campaigns, attempting to direct users to the
lntermountain EE website through search engine results.
For a very modest investment of approximately S100 for
both platforms, YouTube and Google Ads, the campaigns
were conducted from February LL'28,2019. The campaigns
produced mixed results but provided valuable feedback
about these kinds of outreach methods.
The YouTube campaign was not successful. First, the length
of the video used for the campaign presented challenges
for the places the video could appear, severely limiting its
exposure. Second, there were very few searches on YouTube
for "energy efficiency" or "ENERGY STAR," at least during the
time frame of the camPaign.
Although the YouTube campaign did not produce the desired
results, the Google Ad campaign proved very successful. The
campaign generated 855 clicks on the ad, and a conversion
rate (meaning users not only clicked on the ad, but also went
The U.S. Environmental Proteclion Agency recognizos
lntermountain Gas ComPanY
for its outslanding commitmonl lo energy-efticient now homes
and for contribuling
1,079
ENERGY STAR certified homBs in 2019
Figure 4. EPA 20 I 9 Morket Leoder Aword
on to visit the EE website) of LOSo/o.The conversion rate exceeded 100% due to the counting of repeat visitors, not just
unique visitors to the website. During the 18-day period prior to the campaign, the EE page received 938 visits. During
the 18 days of the campaign, visits increased to 1,653. As part of the campaign a list of search terms, such as "energy
star program," "saving energy," "energy conservation," and "home rebate" were designated as key search words to
drive Google search users to the lntermountain Energy Efficiency website. When these words or phrases appeared in
a search, the Intermountain website appeared in the search results. This campaign revealed, at least during this time
period, that energy efficiency terms were rarely used in internet searches.
21
2O2O ENTRGY STAR CERTIFIED HOMES
MARKIT IIAt]TR AI/JARD
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2019 Program Outreach, Awarefiess, anil Eilucatiort
The EE web pages received click from all regions of the lntermountain service territory but the only phrase or word
searched was "lntermountain Gas."
lntermountain also conducted an energy efficiency marketing campaign during the months of October and November in
conjunction with the annual energy efficiency bill insert. The campaign included a coordinated effort around the timing of
the bill insert which included an energy efficiency customer survey, radio ads, internet banner ads and promotion of the
EE Program on the premium web page space "front page, above the fold," on the Company's main web page.
. l a ird,,
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The November bill insert provided energy saving tips about high-efficiency equipment and the related energy efficiency
incentives in the Program offering.
Efficiency
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22
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Let us hcar lrom j,s7,1.
Tell us a little bit about yourself
so we can better meet your
energy efficiency needs. Take just
a moment to complete a brief
3-question survey. You can
by scanning QR code
by visiting
r{ry A section on the bill insert
encouraged customers to
participate in a brief three
question survey to "Tell us a
little bit about yourself so we
can better meet your energy
efficiency needs."@tt*Eif;@tE{.-..:r.?.-Eriffi#HF$:..lgi
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Letus helpyou reach
your enerjnr efFciency goals.
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2019 Progan Outreaclt A*areness, aad Education
The survey consisted of three multiple choice questions:
1. When did you hear about the lntermountain Gas
Company Energy Efficienry Program?
When Customer First HeerdAbout EE Prograrn
As seen in Figure d the most frequent response was
"Just now", or72% of respondents.
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P
--PEvioudy
Unamr€ OI
Prcgram
Just Nil oirs orre Year ,€o within the tst
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2. What is the equipment efficiency rating of your
furnace? Go to ww.intgas.com/saveenergy to
learn how a high efficiency furnace can help lower
monthly bills and earn a 5350 rebate!
Efficicncy of Currcnt Furnece
I
IIF
As seen in Figure 5, most respondents (63%) did
not know the efficiency of their furnace.
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8o%AtutFumace go%AFUEFumace 9596AFUEFumace Unknorm
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3. Where do you go first when you need
information about home energy efficiency?Wherc Customers Co Finst When Needing EE lnformation
As seen in Figure 6,60% of respondents chose
"Search Engine."
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af
EEI
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e J.a
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Departrnent
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:
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23
2019 Program Outreach, Awareness, and Education
While the survey responses provided valuable
information, the actual intent of the survey was
to benchmark customer engagement with energy
efficiency. To explore customer engagement, the
Company printed on the bill insert both a QR (Quick
Response) code and web address to access the survey.
ln addition to the bill insert, the Company sent a total
of 154,883 survey invitations to customers by emai!.
The email was only sent to residential customers with
service starting between 2010 to October 2019, and
who were opted-in to receive email communications.
The average click rate (a metric expressed as a
percentage of respondents that click on an ad to visit
a website) for email campaigns across all industries is
approximately 2.62% according to a recent MailChimp
study ( https ://ma i I ch i m p.co m/reso u rces/e ma i l-
marketing-benchmarks/). The click rate for the EE
campaign was Ll%. The average conversion rate across
al! industries (a metric expressed as a percentage of
website visitors who complete an action out of the
total number of visitors) is 15.91% according to a study
by Ba ri I I ia nce ( https ://www. ba ri I I ia nce.co m/ema i l-
ma rketi ng-statistics/#:- :text=Ave ra ge%Z0Email%ZO
Co nve rs i o n %Z0Rate s%2 0 ( C R ) %2 Osta ti sti cs%2 0 Ov e r Yo2O
Time,-The%20fi rsto/o2Othing&text=The%20averageo/ol0
co nve rs i o n % 20 r ate/ol0pe a ke d, re s pe cta b I e % 2 0
L5.LL%25o/o20co nve rsio n%20in%2O2020. ) The
conversion rate for the energy efficiency campaign was
4.5o/o. For compa rison, an u n related lntermou nta in
"eblast" that encouraged customers to enroll in
online account services had a 2.2% conversion
rate. The high click rate for the energy efficiency
campaign, yet subsequently relatively low
conversion rate indicated the email survey
invitation obtained the proper response
(respondents clicked on the link for the survey),
but the landing page did not inspire engagement
(respondents did not participate in the survey).
The Company learned several lessons from
this customer engagement benchmarking
activity. While the QR code may be gaining in
familiarity from its frequent use in marketing
information, only 16 respondents accessed
the survey by way of the QR code, with all
of the remaining respondents using the web
24
address or link provided in the email. Survey results
show many opportunities stillexist to raise awareness
about the Program and educational opportunities
around the importance of furnace efficiency. The
benchmark activity also demonstrated that customers
were willing to'tlick." However, to achieve true
customer engagement, future landing pages need to
be more engaging to translate high click rates into high
conversion rates.
lntermou nta in sim u lta neously conducted a radio
and internet campaign in conjunction with the bill
insert and energy efficiency customer survey. The
lntermountain EE team collaborated with in-house
talent to produce marketing materials and contracted
with a third party to procure media ad buys. On-air
talent performed live reads on the radio in 10 and 15
second spots, typically with the morning traffic reports,
The Company chose to use live reads in the hope
that listeners would not automatically tune out when
hearing a pre-recorded commercia!, but instead "tune
in" to the voice of the on-air hosts. On a few occasions,
the on-air talent chatted about lntermountain Gas
after a live read, extending the 10-1-5 seconds of actual
purchased time. IGC produced five different scripts for
the live reads which reminded customers to look for
the energy efficiency insert with their billfor money
saving tips, while others mentioned specific rebate
amounts, for example:
"Save energy and money with up to a 5350 rebate with
Display Creative
lnt.rmount.ln Grs Report
Date noge: 10/21{1/r0
Figure I 0. Digrtol Bonner Ad Oeotive
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2019 Prcgram Oubeach, Auareness, and Education
the installation of a qualified natural gas furnace through the lntermountain Gas Energy Efficiency Program. Get
rebate details and energy saving tips at lntgas.com/saveenergy."
The internet digital display campaign included
banner ads of various sizes and placement on
websites !ike howstuffworks.com, hometalk.
com and msn.com. The results from the radio
and internet digital display campaign, which
ran from October 21- November 10, 20L9,
are summarized below. The CTR, or click
through rate, which refers to the percentage
of users which click on the ad after seeing the
ad, exceeded the standard benchmark.
The Company considers this initial campaign a success in elevating awareness about the Program. The EE department
received phone calls that mentioned hearing about the Program on the radio as well as rebate applications that
indicated applicants had heard about the EE Program through the radio.
Outreach efforts to the community included promoting energy efficiency rebates at trade shows, like Buy ldaho at
the Capitol, the Cliff Bar sustainability
fair, and the Association of ldaho Cities
Conference. Trade shows such as
these are interactive, and provided an
opportunity to answer questions, raise
awareness about the EE Program and
provide helpful tips for ways to save
energy. These events give the public
the opportunity to put a face to the
Company, learn about the offerings
that are available to them, and allow
staff to answer any questions that they
might have. IGC participated in trade
shows throughout the Company's
service territory and targeted various
audiences including the general public,
environmental audiences, and youth educational opportu nities.
IGC also targeted outreach efforts with specific industry related conferences and shows, such as the annual ASHRAE
(American Society of Heating, Refrigerating and Air-Conditioning Engineers) conference and the Energy Decision
Making Conference. The Company attends these events for two reasons: first, these events provide the Company the
opportunity to raise awareness about the Program with industry experts; and second, these events provide Energy
Efficiency staff the opportunity to learn about new techniques and technologies in the field.
Additionally, IGC hosted information booths at events with the City of Meridian, The Boys and Girls Club, the Boise
Metro Chamber of Commerce, the Eagle Chamber of Commerce, and the Boise Exchange Club. These events allowed
the Company to support the communities it serves and show its commitment to efficient energy use. lntermountain
also presented information about the Program to audiences of the Meridian Chamber of Commerce monthly lunch
meeting and the South Central Community Action National Weatherization Day demonstration held in Twin Falls.
Figure I l.Dtgitol Disploy Compoign Summory
Figure 12.IGC EETrode Show Boot/'r
25
The CTR ncerly tripled th€ standard benchmar*. of 0.055, with an impressive average of
0.1 5X
Phones were the moit cffc<tive devlce type, wlth 77% of ctick (1,055 in totatl
The 32ox50 mobile banner was the bcst prforminl creative size with a cTR of 0.16s
Of known genders, mates cticked ncerly doublc the amount of times as females (64% vs.
36Xl
Of targe detlvery centeB, Boise and r{eridlan gained rtrong CTRS of 0.15f
2019 Progam Outreach, Ayarcness, anil Eilucation
Home Builders
Purchasing a home is one of the biggest decisions a consumer will make, yet only approximately half of home buyers
consider home energy performance as part of their home buying decision. The Zillow 2017 Consumer Housing Trend
report stated only 50% of home buyers mentioned 'h home must be energy efficient" in their home buying decision;
in 2018 only 56% of home buyers considered energy efficiency to be a "very important" home characteristic. ln the
2019 version of this same report, home energy efficiency did not even make the top three "highly important" home
characteristics sought out by consumers. lnstead consumers were more concerned with being within budget air
conditioning, and the number of bedrooms in the home.
Lack of awareness about the role of energy efficiency in saving money, saving energy, and reducing long term operation
costs remains a vast educational opportunity. This is particularly true in a booming real estate market like the Treasure
Valley. Builders do not need to differentiate their products by energy efficient attributes. ln addition, while consumers
immigrating from regions with stricter energy efficiency mandates may be well-versed regarding home energy
efficiency performance, the affordability of ldaho energy can result in apathy about responsible use of resources: "itt
so affordable, I don't have to care about efficiency." Similar to highlighting the role of energy efficiency in affordable
long-term operations, there are opportunities to raise awareness about the role of energy efficiency in preserving the
livability and affordability of ldaho.
The Company leveraged its memberships with the five different Building Contractors Associations (BCA)throughout
their service territory. During
the 2019 program year the
Companyt participation in the
regional BCAs proved to be an
effective outreach avenue to
promote the Whole Home rebate
program with the home building
community, as well as related
home building industriet such as
realtors, and HVAC contractors.
Builder outreach efforts took
place across lGCt service territory
and included hosting information
tables at general membership
meetings, attending Associates
Council committee meetings,
and joining BCA committees to
gain a deeper understanding of
how to connect with builders
throughout the service territory.
The Company also promoted the
rebate Program at three different
BCA Builder's Expo events,
which are designed to showcase products and promotions exclusively to Parade of Homes builders. This is typically a
mandatory event for Parade of Home builders. These events allowed EE staff to personally interact with homebuilders.
A major focus of the EE Programt outreach efforts was the Parade of Homes, sponsored by regional BCAs, which
provided an effective outreach strategy with both builders and community members at large. lntermountain offered
26
Figure I 3.
additional promotional opportunities to builders whose
homes earned the IGC Whole Home rebate. This included
showcasing ENERGY STAR and HEN marketing materials
at the home, hosting an information table in the home,
and offering a raffle opportunity to visitors to the ENERGY
SIAR certified home. To highlight the energy efficiency
of the home, lntermountain designed the raffle entry
form as a home energy efficiency quiz. The Company
also ran a Facebook awareness campaign encouraging
followers to visit ENERGY STAR homes to tee the ENERGY
SIAR difference" by highlighting home energy efficiency
benefits. IGC also provided ENERGYSIAR marketing
materials to assist in educating and raising awareness
about home energy efficiency, as pictured below.
2019 Program Ortrearh, Awarcness, and Eilucation
builders who do not participate in the Parade of Homes
required a more creative and customized outreach
approach. After being advised to "go where they go...the
golf course", IGC went to golf course events high in builder
attendance. Each BCA hosts at least one golf tournament
per year. As an active hole sponsor at the golf tournament
lntermountain promoted the EE Program to each team
participating in the tournament. lGC hosted a golf game
called the "efficiency hole" where golf teams were timed
from tee off to hole out to find the hstest and thus "most
efficient" team. On courses where this game was not
an option due to safety reasont lntermountain set up a
survey to gauge the knowledge of the participants about
the Energy Efficiency Program. The one-on-one face
Porode of Homes lnformotionToble
A key part of the Parade of Homes promotion focused
on raising awareness about the authenticity of home
energy efficiency claims. Parade of Homes visitors were
encouraged to "Look for the Label" (the ENERGY STAR
label affixed to the breaker box once a home has been
verified by an independent, third pafi). Since the
Whole Home rebate requires a home to be both ENERGY
STAR certified and earn a HERS score of 75 or less, the
campaign also highlighted the meaning and significance
of a HERS score as a measure of home energy efficiency
performance. To clarify the difference between modeling
and certification, IGC encouraged builders and parade
visitors alike to visit the publicly available RESNET national
database of HERS scored homes.
While the Parade of Homes campaign was effective in
reaching parade builders and parade visitors, outreach to
Figure I 5. MogicVolley Building Gnwctors Sponsonhp
time with home builders from these types of activities
proved extremely beneficial in raising awareness about
both the appliance and Whole Home rebate incentives.
For elomple, lntermountain discussed its single page and
multi-entry form applications during a brief conversation
with a builder in Twin Falls to help dispelthat builder's
misconception of an 'txtensive application." The builder
submitted its first rebate application within the same
week.
lntermountain also participated as the title sponsor of
the statewide association, ldaho Building Contractors
Association (IBCA). The EE Program hosted information
tables at the summe[ fall, and winter board meetings, and
also attended open meetings to gain better insight into
topics and issues important to builders and the industry.
27
2019 Program Outreach, Awarcness, afid Educotiol
ln addition to raising Program awareness through BCA participation and sponsorships, lntermountain also attempted to
reach homebuilders that do not participate in a BCA. ln 2019, the EE Program mailed informational postcards to over 1,300
registered homebuilders throughout the Company's service territory. However, the lack of response to this outreach activity
and ability to trace builder responses to this outreach effo( further supports the value of in-person communications. The
Company will continue to explore opportunities to reach builders that do not participate in a building conttactor association.
28
2019 Program Outreach, Awareness, anil Education
Set Yoursetf Apart
From The Crowd
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r Maximum comfort and
maximum energy savings
r Lower utility bilts
r Higher sale/resale value
Learn how to claim your
$1,200 rebate today!
www. i ntga s.co m/e n e rgy-effi ci e n cylwho I e-ho m e-rebate/ El
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29
2019 Program Outreach, Awarcness, and Eilucation
Contractors
HVAC contractors continue to be valued partners in energy efficiency outreach efforts. lntermountain attempted to
keep participation by customers and contractors simple and easy to implement. One request lntermountain received
frequently in the first program year was to create an online application. During the 2019 program year, lntermountain
Gas implemented an online form to make the application process easier for both the customer and the installer.
The Company placed equal importance on accessibility of the online application from both a desktop computer and
mobile device. This allowed contractors to assist customers with applications while on site with the customer, from the
office or anywhere. The Company created an online application using a platform already purchased and supported by
the Company and used by other departments. IGC customized the online form for energy efficiency rebate applications.
lntermountain tried to be thoughtful about the design, testing, and implementation of the online form to avoid
hampering current operations and to ensure enhanced accessibility. On January LS,2OL9,lntermountain recruited
three heating dealers that consistently submitted rebates to participate in testing the online application. Once the
online application passed thorough testing and troubleshooting, it was launched in September 20L9 and added to the
Contractor Portal. Added features such as multiple appliance entry or a Whole Home rebate application will be explored
in the future.
As the EE Program grery a major
priority was to keep the rebate
submittal process simple. ln support
of this priority, the Company added
an HVAC Contractor Portal to the
lGC Energy Efficiency website. This
portion of the page contains all the
information that a participating
contractor would need to navigate
the rebate Program. The three
different sections of the Portal are:
Program Overview, News, and Rebate
Application Forms. To access the
Contractor Portal the contractor
must submit an email address and
company name. After submission, an
automatically generated password is
sent to the contractor allowing access
to the Portal and use of the available
resources. This content is password
protected as an exclusive benefit to
contractors participating in the EE
Program. This process of submitting
an email address and company name
allows the EE staff to track the number
of contractors that have logged into
the Contractor Portal. From the time
A}llmJr{rah,
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the Portal was launched on September Fisire i7'HvAccontroctor
tZth,2019 to the end of the 2019 program year, twenty-three different contractors accessed the Portal.
30
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2019 Pro$arfi Outreach, Awareness, and Mucation
To launch the Contactor Portal, the EE staff
partnered with the Division of Building Safety
(DBS) and hosted an HVAC Contractor training.
The event was held at DBS headquarters because
of its central location between lGCt Nampa and
Boise districts which allowed contractors from
both districts to attend. lntermountain Gas Energy
Service Representatives from the two districts also
attended this event to network with contractors
in attendance and to support, promote and assist
contractors using the Portal. This training covered
how to access the Portal and use it to expedite
the rebate application submittal process. EE staff
received positive feedback from contractors
and received several requests to access the
Portal during the training event. The Company
anticipates sched uling futu re contractor trainings
A Energy
Q Efficiency
Use the right
tool for the job.
lncrease the sales of High Efficiency
appliances and submit your IGC rebates from
anywhere with the new IGC contractor portal
and online rebate form!
Go to
//<>^\\
ffi
AWm**0 Energy
Efficiency
during the early spring and early fall seasons to maximize contractor attendance by avoiding the peak HVAC busy times
of winter and summer. The Company posted the video recording of the September 2019 HVAC training on the Contractor
Portal as a contractor training resource accessible at any time.
To encourage ENERGY STAR participation, the Company offered an ENERGY STAR HVAC course subsidy to contractors
during the 2019 EE Program year. This was a 5900 online course run by a third-party company that upon completion,
would certify HVAC contractors meeting ENERGY STAR HVAC
requirements. To be eligible for the 5300 subsidy, the contractor had to
pre-register with EE staff to participate in the course, and contractors were
required to provide their certificate upon achieving certification. The
Company promoted the course subsidy to contradors on four different
occasions: in a mailing, via email, posting notice on the Contractor Portal,
and sending the information to all the home energy raters across the
Companyt service territory. As a result of this outreach, some contractors
requested more information, four signed up for the course, and one
finished the course, became certified, and received the course subsidy.
The Company made this offering available to contractors to increase
the number of qualified ENERGY STAR HVAC contractors and make the
ENERGY STAR build process easier for certified builders.
Other contractor specific EE Program outreach included emailing
Program updates to all participating contractors, working with individual
contractors to resolve issues, and reaching out to contractors that had
rejected rebate applications. EE staff made a concerted effort to reach
out to contractors identified on applications that were rejected because
the appliance did not meet the required minimum efficiency. Contractors
were provided Program information and appliance rebate requirements
to help resolve any misunderstandings or further confusion regarding
Figure te.HVAC Caurse Subsidy Moiting minimUm required effiCienCieS. These individual interactionS with
contractors (including sales teams, installers, and new construction specialists) also provided opportunities to promote the
EE Program, answer questions and collect feedback from contractors.
31
www.i ntgas.com/saveenergy
September 12
7a.m.-8a.m.
DBS conference room
1090 E Watertower St #1 50
Meridian, lD 83642
[e-mail]
RSVP to
Join us for a
LIVE DEMO
of the online form and
NEW contractor portal.
Join us for breakfast
and enter for a chance to
win prizes including a
$100 Cabelas gift card
2019 Program Outreach, Atareness, anil Eilucation
Home Energy Raters
ln the peak of the 2019 summer building season, EE staff went on a ride-along with an energy rater to see firsthand
the rating process and gain a better understanding of the details of day-to-day operations. This ride-along also allowed
EE staff to answer questions about lGCt rebate Program and inform the energy rater of new Program opportunities.
During the 2019 program year, EE staff reached out to all raters in the Companyt service territory with information
about the ENERGY SIAR HVAC Course subsidy (see "Contractors" section above) and asked them to spread the news of
this opportunity to HVAC contractors in their areas. Home energy raters have been great partners in raising awareness
about the EE Program and answering specific technical questions that builders have regarding the ENERGY SIAR building
process.
Special Partnership Projects
ln 2018, lntermountain embarked on a specia! partnership with Boise Valley Habitat for Humanity (BVHFH), an
organization dedicated to % world where everyone has a decent place to live." Not only was BVHFH committed to bring
people together to "build homes, community and hope," but as an organization, it recognized the role of home energy
efficiency in building quality, affordable homes. lntermountain partnered with BVHFH to highlight its mission to provide
affordable housing, while also raising awareness about home energy efficiency, by documenting the build process of the
BVHFH ENERGY STAR Certified Home from start to finish.
The partnership started with an officialgroundbreaking in October 2018 which included community partners like the
Mayor of the city of Meridian, the Meridian Chamber of Commerce, BVHFH board members and volunteers, and
executive leadership of the Company. lntermountain employees and members of the Building Contractors Association
of Southwest ldaho participated as volunteer build teams.
One of the major challenges of an energy efficient home is that it does not look different from any other home. Most of
the things that make a home ENERGY STAR certified take place during the construction process. To help both builders
and consumers alike better understand the diffurence of an ENERGY SfAR home, IGC brought people to the build site,
without actually bringing them to the build site, by gaining permission to video document the build process of the
BVHFH ENERGY SIAR home. Each video highlighted a different aspect of an ENERGY STAR certified home, including:
. High efficiency heating and cooling
. Complete thermal enclosure
o Water protection
. Efficient lighting and appliances
o lndependent inspections and testing
This series of educational videos now lives on the lntermountaint YouTube channel and on the Company's website
under the web page titled "The ENERGY STAR Difference." The videos can be accessed by anyone interested in learning
more about the benefits of an ENERGY STAR certified home. The web page received 1,560 views in 2019.
Proper air sealing of a home is important in building an energy efficient home. According to an air sealing study
conducted by then DBS manager Jerry Peterson, with proper technique, no additional investment of time or materials is
required to achieve superior results. At the critical time of air sealing in the BVHFH build, BVHFH allowed Jerry Peterson
to use the Habitat home to demonstrate proper air sealing technique. lntermountain filmed this demonstration to
32
2019 Program Oubeach, Awareness, aill Educatiott
produce a 15-minute instructional video. This video is now an instructional resource for all builders and contractors to
access on the lntermountain YouTube channel.
= Etd&
sdly sltlrdl.l
The Meridian Chamber of Commerce invited lntermountain to
be the keynote presenter at its monthly luncheon to talk about
and promote both home energy efficiency and the BVHFH Energy
Star certified home partnership. The community was invited to
celebrate in the official ribbon-cutting ceremony and for the first
time in BVHFH history the home was open for the community to
tour.
The BVHFH ENERGY STAR certified home was
completed in April2019. BVHFH and lntermountain
celebrated the completion of this home
appropriately on Earth Day 2019. The grand opening
event was promoted by lntermountain, BVHFH, the
Building Contractors Association of Southwest ldaho
and The Meridian Chamber of Commerce through
save the date cards, Faceboolt and posts on the
Chamber calendar of events.
SIAFCertified
Gucrt
Figure 22 Home
33
2019 Progran Outteadr, Awareness, and Education
Figue 23. BVHFH ENERGY SIAR Certrfed
Home Hondout
BVHFH also hosted open
house weekends to
allow the community to
tourthe ENERGYSIAR
home outside of the
one-day celebration.
lntermountain had an
information table in the
gaEge, directly in front
of the home certification
labels, and provided
information specific to
the energy efficiency
attributes of the BVHFH
ENERGY STAR certified
home.
After the success of the
ENERGYSTAR certified
home, lntermountain
continued to partner
with BVHFH to promote
the need for affordable
housing and the
lntermountain Energy
Efficiency Program. IGC
employees volunteered
in the BVHFH "Village
of Playhouses" event. Participating corporate teams
were provided a playhouse kit to build and decorate.
Ultimately, the playhouses were put on display at The
Village Shopping center in Meridian, tdaho. All playhouses
were raffled off with a!! proceeds benefiting BVHFH.
lntermountain used this
opportunity to again
focus on responsible
use of resources. The
children's playhouse
channeled the messaging
of Dr. Seuss' "The Lorax,"
as the theme of the
playhouse. The team
incorporated energy
saving tips from the EPAs
"Join the Lorax," themed
children's resources into
the design.
34
ln an additional effort to promote energy efficiency with
the community at large, lntermountain Energy Efficiency
provided a sponsorship to the 2019 St. Jude Dream Home
Giveaway home. The Dream Home Giveaway consists
of numerous supporters collaborating to underurite
and build a home that is raffled off with all proceeds
benefitting the St. Jude Childrent Research Hospital. The
home is open for the community to tour week before
and after raffle tickets go on sale, and tickets typically sell
out in hours, if not minutes, due to the overwhelming
popularity of the giveaway and support for the mission of
St. Jude Children's Research Hospital.
The 2019 Dream Home earned the lntermountain
Whole Home rebate and was built by an ENERGY SIAR
certified builder that regularly redeems the lntermountain
Whole Home rebate. lntermountain's primary purpose
in sponsoring this event was to showcase the energy
efficiency features of this home, howeve[ the Company
experienced challenges in getting its messaging out with
allthe other promotions surrounding the Dream Home
event. The Company learned two important lessons
when it comes to messaging: placement and fit. When
eva I uati ng promotiona I opportu nities, the Company
learned that it is important to evaluate whether an
energy efficiency message will stand out among the other
messaging surrounding an event. Additionally, messaging
should match the overall promotion. ln this case, "home
energy efficiency" and "luxury," do not necessarily equate
with each other. While a luxury home is often an energy
efficient home, home energy efficiency is not just for a
dream home, it is forevery home.
Figure 24. BVHFH Villoge of Ployhouses
The Energy Efficiency Stakeholder Committee met in Twin
Fa!!s in May 2019 for a special presentation by Dunsky
Energy Consultants (Dunsky). Dunsky provided an overview
of the CPA study, study methodology and preliminary
results, followed by question and answer session and
discussion. The Company also provided a program update.
At the October 9th meeting in Boise, lntermountain sought
input regarding the plan to conduct the first Program
Evaluation, Measu rement a nd Verifi cation ( EM&V) study.
The Committee discussed both the necessity and scope of
both an impact evaluation and process eraluation. Based on
the financial outlay of a comprehensive EM&V study, and
that only two measures contributed the largest portion of
therm savings, the Company proposed an impact study of
just the furnace measure to verify savings. The Committee
discussed whether the Quality Assurance (Qfl) provided
by RESNETfoT both HERS rated homes and ENERGY SIAR
certification could be used in lieu of an impact evaluation
of the whole home rebate. The Stakeholder Committee
decided that while RESNET QA provides oversight of actual
home certifications and energy efficiency scores, an impact
evaluation would be required to veriftr therm savings. This
led to a robust discussion about the current HEN threshold
for the Whole Home rebate and it was suggested the
Company explore a tiered approach to the HERS threshold.
The Company plans to explore this in the EM&V study.
The meeting also provided an opportunity to review
preliminary proposed changes to the residential rebate
offering based on the CPA findings. Although therm saving
potentialwas identified in the study, lntermountain will
need to further examine the feasibility of specific additional
rebate offerings, based on the administration requirements
and subsequent impact on cost-effectiveness.
Finally, the meeting provided a brief overview and
discussion of Intermountain's participation in the Emerging
Technology Program with the Gas Technology !nstitute, as
well as a mini tour and discussion of lntermountain's past
participation as a cold-climate test site in the development
of rooftop natural gas heat pump technology.
lntermountain will continue to work with the Energy
stakcholdcr input
lntermountain Gas Company
Stokeholder lnput
20L9
Efficiency Stakeholder Committee to revise the current
residential offering and explore additional Program
offerings to present to the Commission for final approval.
Likewise, the Company will also work with the Committee
to design a commercial offering, based on the CPA study, to
capture additional therm savings.
35
Energy Efficiency: lnvesting Today's Savings for an Energy Efficient Future
,narlet tran slorfiation
lntermountain Gas Company
Market Tronsformation
20L9
lntermountaint Energy Efficiency rebate offering is a
"traditional resou rce acqu isition progra m...designed to
garner savings quickly with a straightforward effectiveness
metric." ( M a rket Tra nsformation : Movi ng Beyond
Traditiona! Energy Efficiency Programs to Cement Change-
Jan Harris, Utility Dive, July 2,20L91. When it comes to
saving energy lntermountain isn't just focused on today.
ln fact, lntermountain is investing energy savings of today
to secure an energy efficient future.
lntermountain has long been a member of the Gas
Technology lnstitute (GTt), an organization committed to
turn technology and insights into solutions that create
exceptional value for customers in natural gas." Over
the years, the Company participated in collaborative
programs fucilitated by GTl, such as the member group
Operations Technology Development (OTD) and the
Utilization Technology Development (UTD). OTD work to
develop, test and implement new technologies related
to reliable operation of the infrastructure, while UTD, is
a member group formed to conduct near-term applied
research to develop, test and deploy energy efficient
end-use technologies. lntermountain also participates
in the Emerging Technology Program (ETP) facilitated by
GTl. ETP is a member driven committee "to accelerate
the market introduction and acceptance of new emerging
technologies to feed utility energy efficiency programs."
The work of ETP is focused on research and development
to optimize technology before commercialization and
has been instrumental in getting natural gas technologies
to the point of commercialization. Gas Heat Pump
technology is just one of several energy efficiency key
initiatives of GTl. Gas heat pump technology is particularly
exciting from an energy efficiency standpoint because it
can achieve efficiencies of over LOO%. The latest round
of gas-fired heat pump water heaters being tested
meet ultra-low emission requirements, have twice the
efficiency of standard water heaters, and offer lower
operating costs and cost of ownership.
GTI and 15 utility sponsors, including lntermountain,
most recently participated in the gas heat pump roadmap
( Roadmap), to "identifo opportunities, information
gaps, impediments and strategies to accelerate the
commercialization and market acceptance of gas heat
pumps in North America." A large-scale residential
gas heat pump water heater demonstration project is
currently undenruay to include a nrnge of field, laboratory
and market activities. More information about this
project is ava i la b le at https ://www.$i.ene rgy/e n ha nci ng-
efficiency-i n-space-cond itio n i ng-a nd-water-heati ng/.
While lab testing of equipment and identifying market
barriers and impediments in market acceptance of
the gas heat pump is vital to the commercialization of
gas heat pumps, identifoing these crucial challenges is
merely the first step towards true market acceptance
and integration. The successful launch of gas heat pump
technology will be instrumental in ensuring continued
gains in gas appliance energy efficienry. To avoid the fate
of other emerging energy technologies that have taken as
long as 10 years to achieve marginal market acceptance,
lntermountain joined the North American Gas Heat Pump
Collaborative (Collaborative). As a charter member of the
Collaborative, lntermountain will have an equalvoice at
the table, alongside 14 other utilities which combined
represent 27% of North American gas households.
Representation of this magnitude will be important to
engage manufacturers, distributers and suppliers in
producing new energy efficient natural gas equipment to
benefit our customers.
Building on the foundation of work established by the
Roadmap, the Collaborative was created to accelerate the
market adoption of natural gas heat pump technologies.
36
rnarkct transforntati ofi
The heat pump technologies for both natural gas space heat and combined space and water heat will be the focus of
the organization. To begin, the Collaborative hired consultant Resource lnnovations (Rl)to create the organizational
structure to facilitate the strategic activities of the Collaborative such as manufacturer and distributor engagement,
retailer engagement, installer training and support, and engagement with partners to change national standards.
Rlguided the development of the board, long-term governance committee and operations committee to ensure
the independence and sustainability of the Collaborative as an organization. For the first year, Rt will also fucilitate
the initiatives of the two main gas heat pump working groups to define priorities, activities, funding of projects and
timelines.
The Energy Efficiency Program invested Stt,000 as a charter member of the Collaborative in 2019. ln addition to
capturing energy savings today by providing incentives to acquire savings quickly, this investment will secure an energy
efficient future for our customers by accelerating the production, availability and adoption of high efficient equipment
able to deliver new energy savings and lower energy bills, developing least cost methods of reducing greenhouse gasses,
and preseruing fuel choice for our customers today and tomorrow.
37
thefuture
lntermountain Gas Company
The Future
20t9
The outcomes of two sepaftlte issues will potentially have
the greatest impacts on the future of the Program.
ln Order No.34535, issued in Case No. INT-G-19{4, the
ldaho Public Utilities Commission deemed 2OL7-2OL8EE
Program expenses as prudently incurred. Additionally, the
Commission recommended that lntermountain work with
the Stakeholder Committee to review the avoided cost
calculation and develop an avoided cost methodology.
A Stakeholder Subcommittee (Subcommittee)
workgroup was formed to develop an avoided cost
calculation methodology. The Subcommittee agreed on
a methodology for calculating avoided costs related to
commodity and transportation costs. At the time of this
writing, the group had not agreed upon a way to quantify
avoided distribution costs. While the new avoided cost
methodo logy ma kes cost-effectiveness tests more
challenging the Subcommittee conducted a thorough
review and will continue to work toward a methodology
that includes avoided distribution costs. Untilsuch time
the avoided cost calculation developed by the committee
will be used for cost-effectiveness testing and program
planning.
The lntermountain Energy Efficienry Program willbegin
2O2Oby commissioning an EM&V study. The study
will include an impact eraluation to verifo savings of
the two largest therm saving measures: the Whole
Home incentive and the furnace incentive. Additionally,
a process evaluation will be conducted to review
Progra m administration, implementation a nd delivery
as well as customer satisfaction and market response.
lntermountain will work with the Stakeholder Committee
to review the study results in conjunction with the CPA
study to determine refinements and additions to the
current residential offering.
Evaluation and recommendation on program delivery
and customer satisfaction from the first completed EM&V
study, and an agreed upon avoided cost calculation will
set the stage for the next step in the evolution of the
Program: developing a program offering for commercial
customers. Based on the conservation potential identified
38
in the CPA, lntermountain will work with the Stakeholder
Committee on developing a commercia! energy efficiency
program.
Although certain outcomes of Program review are at
the time of this writing unknown, one thing is sure:
lntermountain is committed to continuous improvement
to help customers save energy and money. The Company
embraces the enthusiasm customers have shown for
energy efficient solutions and willcontinue to put the best
solutions forward to meet those needs.
DGIIBIT NO.2
CASE NO. INT.G.2O.O6
INTERMOIJNTAIN GAS COMPANY
Enerry Efficiency Stakeholder Committee Meeting Mnutes
(18 pages)
Exhibit No. 2
Case No. INT-G-20-06
lntermountain Gas Company
Page 1 of 18
AVOIDED COST SUBCOMMITTEE MEETING MINUTES
(7 pages)
Exhibit No.2
Case No. INTG-2G06
lntermountain Gas Company
Page 2 of 18
lntermountain Gas Energy Efficiency Stakeholder Committee
Avoided Cost Subcommittee Meeting
February L2,2020 at 9:30am
lntermountain Gas Company Conference Center, 555 S. Cole Road, Boise, lD 837L4
Minutes Recorded by Raycee Thompson
Attendees:
Katie Pegan - Office of Energy and Mineral Resource Selena O'Neal - Ada County
Madison Olson - Office of Energy and Mineral Resource Stacey Donohue - ldaho Public Utilities Commission
Kevin Abbot - Western Heating Brad lverson-Long - ldaho Public Utilities Commission
Mike Morrison - ldaho Public Utilities Commission Kevin Keyt - ldaho Public Utilities Commission
Ben Otto - ldaho Conservation League
Presenters:
Lori Blattner - lntermountain Gas Company
Kathy Wold - lntermountain Gas Company
Raycee Thompson - Intermountain Gas Company
Jacob Darrington - lntermountain Gas Company
Landon Barber - lntermountain Gas Company
Presentation
- Why a Commiftee? - lntermountain applied for a Prudency Review of the EE Program, and per the final order:
o Expenses were prudently incurred.
o Need to have an EM&V studY.o M o n itod #"lffiTff fl?[Jt'i"",.;:lii, n.",.,,"
o Review avoided costs.
Overview of Utitity Cost Test (UCTI
Avoided Costs Overviewo Company Proposal' toroil:::;L
basin pricinso Not shapedr Transportation Cost
: Hff ,l::i:?i :::::l'.ltl:l;::rfiiffiTts
f rom N orthwest Pi peri ne
. Distribution Cost
o Uses full tariff distribution cost
o Staff Suggestion from Case No. INT-G-19-04. Commodity Cost
o Uses tariff weighted average cost of gas
' Transportation Cost
. r*;ou.',ii'.'JJl* ffi:" .":"
Exhibit No. 2
Case No. INT-G-20-06
lntermountain Gas Company
Page 3 of 18
Avoided Costs Scenarios
o Reviewed change in avoided costs and UCT after corrections to the Company proposed avoided costs
made during the IRP process were incorporated. The error was not material enough to change the UCT
results.
o Showed the UCT results from including HDD shaped commodity costs.o Showed the UCT results from excluding Distribution Costs. Not including a distribution cost component
would make several of the current program offerings no longer cost effective.
Discussion
Filed Avoided Costs
Discussed changing the Company's definition of avoided costs to include all costs that can be avoided, not just
the marginalcosts.
ACTION ITEM: lntermountain will develop a revised written definition of Avoided Costs to discuss all costs that
can be avoided, not just the marginal costs.
Distribution Costs
Discussed the distribution costs in the avoided cost calculation. The Company maintained that inclusion of full
tariff distribution costs is meant to be an estimate of future costs that would be reduced by the Company's
Energy Efficiency programs. lt was agreed that the Company should include some amount of distribution costs.
However, there was some discussion that the Company can only avoid the present value of future distribution
system expansion.
Discussed the possibility of increasing promotions in specific areas of interest to possibly delay large capital
projects. Also discussed that as the Company's Program matures, the Company will need to show how energy
savings impacts the timing of capital projects. The Company expressed concern with the perception that would
be created by having different program offerings in different areas of the state. A possible solution that was
presented is offering the same rebate across the service territory but using the higher avoided cost in a
particular area to pay for additional program promotion.
The Company expressed concern that stripping too many costs out of the Avoided Cost calculation will make
most rebates not cost effective. Members of the Commission Staff indicated that the Commission has set a past
precedent of maintaining other utilities' DSM programs despite them not being cost effective to avoid disrupting
program continuity. This allows the program to work through issues and become cost effective over time.
There was a question about why the commercial costs were included in the proposed calcutation. The Company
explained that the residential and commercial rate classes are combined in the avoided cost catcutation as it is
anticipated that a commercial efficiency program will be proposed in the near future.
ACTION ITEMS: Review the calculation of distribution costs for inclusion in the avoided cost model. For future
lRPs explore promotions in specific areas of interest to encourage program uptake and possibly delay large
capital projects.
Transportation Cost
Discussed the inclusion of fixed and variable transportation costs in the avoided cost calculation.
Discussed the process of negotiating and securing transportation capacity. The Company explained that it can
monetize pipeline capacity that is no longer needed due to decreased usage resulting from the Company's
energy efficiency program. Those credits would be passed back to lntermountain's customers through the
annual PGA filing.
Exhibit No.2
Case No. INTG-2G06
FliTHltfl'Gas
comPanY
Commodity Costs
Discussed the appropriateness of including the highest basin price as the avoided commodity cost. The
Company explained that this method represents the cost that would be avoided on a peak day. The Commission
Staff disagreed with the Company's inclusion of the highest basin price arguing that the Company does not
regularly buy the highest priced gas. The Commission Staff maintained that the Company should model its
avoided commodity cost based on how it regularly purchases gas.
Discussed briefly the idea of incorporating a risk factor into the avoided commodity costs when not selecting the
highest commodity cost.
Discussed the idea of shaping the commodity costs based on heating degree days vs therm usage.
ACTION ITEMS: Review the commodity costs included in the avoided cost calculation. Explore weighting ideas to
more accurately reflect the way gas is purchased. Look into including a risk factor when not selecting the highest
commodity cost.
Energy Efficiency Program Promotion/ Rebates
The Company expressed concerned that if rebates are reduced too much, then participation is going to drop. A
committee member in the HVAC industry supported this position.
lntermountain maintained that it cannot have a program if good incentives are not in place. Starting and
stopping an Energy Efficiency program is not a viable option. A committee member emphasized that gas prices
will eventually increase, so the Company's Energy Efficiency program needs to be established for when they do.
Discussed various promotion and rebate ideas:
o Weighting the 95% efficient furnace incentive based on the old equipment from which the customer is
switching
o Offering incentives to customers to upgrade before failure.
o Offering more low-tech solutions such as insulating lines or a wrap for the water heater.
o Offering incentives to builders/architects to design homes that are energy efficient.
Next Steps
- The Company needs to propose a methodology for:
o Distribution Costs
o Commodity Costs - ShaPing
The Company will send the proposalfirst and then schedule a meeting to discuss.
Exhibit No.2
Case No. INT-G-2G06
lntermountain Gas Company
Page 5 of 18
lntermountain Gas Energy Efficiency Stakeholder Committee
Avoided Cost Subcommittee Meeting
June 2, 2020 at 1:00 pm
Held Via Microsoft Teams
Minutes Recorded by Raycee Thompson
Attendees:
John Chatburn -Office of Energy and Mineral Resources
Katie Pegan - Office of Energy and Mineral Resources
Marissa Warren - Office of Energy and Mineral Resources
Ben Otto - ldaho Conservation League
Selena O'Neal - Ada County
Stacey Donohue - ldaho Public Utilities Commission
Mike Morrison - ldaho Public Utilities Commission
Kevin Keyt - ldaho Public Utilities Commission
Brad lverson-Long - ldaho Public Utilities Commission
Presenters:
Lori Blattner - lntermountain Gas Company
Kathy Wold - lntermountain Gas Company
Raycee Thompson - lntermountain Gas Company
Jacob Darrington - lntermountain Gas Company
Landon Barber - lntermountain Gas Company
Presentation
Safety Moment - Kathy: Auto fatalities and miles driven have gone down, but the deaths per mile have gone up
L4oA.The few drivers that are on the road are driving recklessly.
lntroductions/Role Call - Kathy
Brief Review of "Next Steps" from the Last Meeting - Kathy: The Subcommittee had agreed that the Company
would propose a revised methodology for calculating distribution costs, transportation costs and commodity
cost shaping that incorporated Subcommittee feedback.
Overview of the Revised Proposa! - Jacob & Landon: The revised method is based on costs that can be easily
derived from the annual PGA adjustment and the Company tariff.o New Formula: Nominal Avoided Cost Per Therm = Commodity Costs + Transportation costs + Variable
Distribution Cost
o Commodity Costs: Start with the 2019 WACOG. Price forecasts from the lRP were used to derive a
growth rate which is applied to the 2019 WACOG. HDD was used to shape the costs by weighting
monthly prices to derive an annual figure. This method uses the way gas is actually purchased to inform
the forecast to pick the most probable price point versus the most expensive. Shaping with HDDs also
better aligns the prices for the time period during the year when therm savings would be realized on
energy efficiency measures. Commodity costs run through 2035.o Gas Transportation Costs: The Company is using the gas transportation costs from the Company's tariff
for RS and GS-1. These costs are derived from Exhibits No. 5 and 5 of lntermountain's annual PGA filings.o Variable Distribution Costs: The Company moved from using the total distribution cost to using only the
costs that vary in relation to therm usage. A calculation was developed that mirrors work done in the
Line Extension filing to pull out a specific set of costs from the 2015 GRC. These costs that vary with
customer usage are the basis of the avoided variable distribution cost.
o Benefits of the New Method: Commodity Costs reflect the way the Company actually purchases gas, the
Transportation Costs are based on known costs and the Variable Distribution Cost is restricted to only
variable costs.
Exhibit No.2
Case No. INTG-2G.06
lntermountain Gas Company
Page 6 of 18
Discussion
Commodity Costs- Committee members expressed concern about using the WACOG and would like to discuss further in the next
meeting.
Varia ble Distribution Costs
- Committee members expressed concern about including distribution costs because historical costs can't be
avoided. Additionally, it was argued that distribution costs do not vary with usage. The Company explained that
historical costs help to estimate the future costs that could be avoided. The Company also suggested that if
therm usage is reduced then the Company avoids costs to expand the distribution system because it can be used
by more customers.
Future Meetings
- The subcommittee will discuss the method presented during a Q & A session of the revised methodology
proposal on June 4,2020.
Exhibit No. 2
Case No. INT-G-20-06
lntermountain Gas Company
Page 7 of 18
lntermountain Gas Energy Efficiency Stakeholder Committee
Avoided Cost Subcommittee Meeting
June 4, 2020 at 1:00 pm
Held Via Microsoft Teams
Minutes Recorded by Raycee Thompson
Attendees:
Ben Otto - ldaho Conservation League
Katie Pegan - Office of Energy and Mineral Resource
Marissa Warren - Office of Energy and Mineral Resource
Stacey Donohue - ldaho Public Utilities Commission
Presenterc:
Lori Blattner - lntermountain Gas Company
Kathy Wold - lntermountain Gas Company
Raycee Thompson - lntermountain Gas Company
Brad lverson-Long - ldaho Public Utilities Commission
Kevin Keyt - ldaho Public Utilities Commission
Mike Morrison - ldaho Public Utilities Commission
Selena O'Neal - Ada County
Jacob Darrington - lntermountain Gas Company
Landon Barber - lntermountain Gas Company
Presentation
- Safety Moment - Kathy: Cyber safety moment. Delete applications you haven't used in the last G months to
remove potential threats.- RollCall- Kathy
Discussion
Appropriate Marginal Commodity Cost
Discount Rate
- There were some questions about the derivation of the discount rate of 6.58%.The Company walked through
the calculation of the discount rate and explained that it is derived from the Weighted Average Cost of Capital
and includes an adjustment for the tax benefit resulting from the TCIA. The Subcommittee agreed the
Company's calculations were correct.
Heating Degree Days
- A Subcommittee member asked if it would be preferable to shape commodity costs by therm sales vs HDD. The
Company explained that therm sales and HDDs derive the same shape. HDDs were chosen because it doesn't
vary as much from year to year. Plus, most of the Company load is temperature sensitive. The Subcommittee
agreed that shaping by therm sales and HDDs would result in similar results.
Commodity Cost Calculation
- The growth rate and its derivation were discussed. The Company explained that the growth rate is derived from
the supply basin forecast and is applied to the PGA WACOG. The Subcommittee expressed some concern with
this method and suggested looking at the average cost of day gas purchases instead of the WACOG and applying
the HDD and basin weighting to it. The Company suggested using the basin price forecast from the tRp and
applying the HDD shape and basin weighting to derive the commodity cost.
Exhibit No.2
Case No. INT-G-20-06
lntermountain Gas ComPanY
Page 8 of 18
Price Forecast
- Committee members expressed concern about the transparency and availability of information surrounding the
supply basin price forecasts. The Company explained that the pricing forecast included in the IRP is the best
available information, but that it is deemed confidential by the entities that provide it. There was agreement
that a price forecast that tied to the IRP is important. There was also a question regarding whether the price
forecast was day gas or month pricing. The Company explained that the IRP price forecast was not granular
enough to forecast by type of gas (i.e' day-gas vs. monthly pricing).
Appropriate Distribution Costs to lnclude
- A lengthy discussion was held regarding the inclusion of distribution costs in the Avoided Cost calculation. The
main concern is that the Company cannot avoid costs for pipe that is already in the ground. ls the cost
representative of the plant that the company will avoid in the future?
- The Company argued that it used historical costs as an estimate of the future cost that can be avoided through
energy efficiency measures. lf the Company can use existing infrastructure more efficiently, then it can serve
more customers with the same pipe. Ultimately lntermountain can reduce the ratio of the embedded costs per
customer as cost is spread over a larger customer base. The Subcommittee questioned whether or not it was
truly a 1:1 reduction. ls l therm really going to reduce the embedded cost significantly enough to use the entire
embedded costs?
- lt was suggested that the Company could capture delayed projects due to energy efficiency savings by taking the
time value of the deferral. There is a value for hours/seasons/time of day for electric utilities and then you use
the appliance consumption curve to determine the savings by measure. The capacity costs are fonl|rard looking
and come from the resource planning and regulatory groups.
- lt was also suggested the Company could try to use a surrogate project that would capture system upgrade
costs. Committee members explained that the logical way to determine a surrogate is to look at the resource
plan and see what the Company is going to avoid building in the plan and then calculate the present value of the
delay.
Recommendations
Appropriate lVarginal Commodity Cost
- The Company agreed to revise the commodity cost calculation as discussed and present it to the Subcommittee
via email for final agreement. The resulting commodity costs would be based on the IRP price forecast and then
basin and HDD weighted.
- The Company is also happy to establish a confidentially agreement to share the supply basin price forecast with
the Subcommittee.
Transportation Costs
- The Subcommittee agreed that the Company's proposalto use gas transportation costs taken from the
Company's RS and GS-1tariffs was appropriate.
Appropriate Distribution Costs to lnclude
- The Company agreed to continue to work on identifying an agreeable method to calculate avoided distribution
costs. The feedback from this meeting was helpful and the Company will use it as it reviews the calculation.
Future Filings
- The Company suggested that it rerun the avoided costs with the updated commodity costs and then send out a
comparative analysis between the old and new methods. Then the Company can move fonrard with the new
method after the Subcommittee reviewed the update.
- Follow up email communications with the Subcommittee resulted in agreement on the avoided cost calculation
that resulted from feedback from this meeting.
Exhibit No. 2
Case No. INT-G-20-06
lntermountain Gas Company
Page 9 of 18
ENERGY EFFICIENCY STAKEHOLDER COMMITTEE MEETING
MINUTES
(9 pages)
Exhibit No. 2
Case No. INT€-2G06
lntermountain Gas ComPanY
Page 10 of 18
lntermountain Gas Energy Efficiency Stakeholder Committee
Meeting
May 20, 2019 at 10:00am
lntermountain Gas Company Conference Center,451 Alan Drive, Jerome, lD 83338
Minutes Recorded bY KodY ThomPson
Attendees:
lngo Stroup - Building EnergY
Mark Chiles - Intermountain Gas Company
Lori Blattner - lntermountain Gas Company
Katie Pegan - Office of Energy & Mineral
Resources
Marissa Warren - Office of Energy & Mineral
Resources
Matt Marion - ATS lnland NW
Jonathan Grove - ATS Inland NW
Cheryl lmlach - lntermountain Gas Company
lerry Peterson - ldaho State Department of
Building Safety
Guests and Presenters:
Mark Chiles - lntermountain Gas Company
Kathy Wold - lntermountain Gas Company
Francois Boulanger - Dunsky Energy Consulting
Meeting Facilitator: Kathy Wold
Jim Capps - lntermountain Gas Company
Brian Bennett - The Energy Auditor, lnc.
Francois Boulanger - Dunsky Energy Consulting
Kathy Wold - lntermountain Gas Company
Kody Thompson - lntermountain Gas Company
John Fisk - lntermountain Gas Company
Donn English - ldaho Public Utilities
Commission
Cassie Koerner - ldaho Public Utilities
Commission
10:00 am - Meeting Convened
Mark Chiles opened the meeting, welcoming the group to lntermountain Gas Company's meeting
regarding the Energy Efficiency Program, he commented on the progress of the program compared to
when it was just an idea. He expressed gratitude for the time of those in attendance. Everyone in
attendance then gave introductions to the group. The intent of the meeting held today is to provide
information on Dunsky Energy Consulting's (Dunsky) Conservation Potential Assessment (CPA).
Exhibit No. 2
Case No. INT-G-20-06
lntermountain Gas Company
Page 11 of 18
10:15 am - CPA Study Overview - Francois Boulanger
Francois provided background on the company's history of energy consulting that they have done work
spread across the continent, and that the study has been going on forthe previous 9 months. ln
providing an overview of the study, Francois discussed the following key points:
o Dunsky worked with the Gas Technology lnstitute to determine emerging technologies as well
as with Frontier Energy for primary data collection and market characterization
o Technical, Economig and Achievable Potentialwere defined.
o The study does not go beyond the Achievable Potential and lntermountain Gas is responsible for
determining the programs to implement and the potential levelto pursue.
o The CPA covers a 20-year period, focusing on the residential and commercial sectors across the
2 climate zones in ldaho.
r The study is to be used for resource planning, to identify opportunities for achievable DSM
opportunities, to improve program planning to meet long-term savings objectives, and to inform
the program portfolio and design.
Additionalconsiderations forthe program were also discussed, including: Cumulative measures chaining
that can lead to reduction in total therm savings; relevant planned and potential codes and standards
related to ldaho building code and appliance and equipment standards; and how different measure
types can affect the long-term goals of the program.
L1:00 am - Study Methodology - Francois Boulanger
Francois discussed the methodology for the study and what went into informing the study results. The
following key points were discussed:
o Measure & Market Characterization was done to identify measures included in the study
Exhibit No.2
Case No. INTG-2G06
lntermountain Gas Company
Page 12 of 18
o This characterization included the savings that could be procured, additional costs of the
measures, applicable markets, useful lives of the equipment, customer segmentation, saturation
data and understanding the market.
o Avoided costs, discount rates, and screening tests were determined
r New programs typically have a ramp-up period of 3 - 6 years depending on the technology,
market, end-use, and the way the program is designed.
. 3 scenarios were considered for assessing achievable potential: incentivizing between 35% and
55% of the incremental costs.
There were questions and comments as to whether fuel switching was included and if it focused on the
natural adoption or incentivized fuel switching. Questions were also raised about whether population
growth was factored into the study. Finally, it was discussed that contrador prices have historically
increased whenever there is an incentive being offered.
\2:00 pm - Lunch
1,2:30 pm - Program Update - Kathy Wold
Kathy provided an update on the energy efficiency program since the last meeting that took place in
November. The following key points were discussed:
o The department is growing to improve its reach within the service territory and introduced the
newest member of the team
o Feedback from the previous meeting regarding a lack of Energy Star credentialed contractors or
raters led to a S3OO.O0 course subsidy offered through a partnership with Advanced Energy
o The online form previewed in the previous meeting is currently being beta tested with select
HVAC contractors.
Exhibit No. 2
Case No. INT€-2G06
lntermountain Gas Company
Page 13 of 18
. Intermountain Gas Company Partnered with Boise Valley Habitat for Humanity on their most
recent Energy Star home. As part of the partnership the build process was documented, and the
videos placed on a dedicated page on the lntermountain Gas website.
1:00 pm - CPA Study Results - Francois Boulanger
Francois provided a high-level report of the results of the CPA study, as well as some of the
recommendations from the study. The following key points were discussed:
o A recommended budget between 54 Million and S12 Million
o Sales can, potentially, be reduced by t2% across the 20 year period of the study if the base
achievable model is used.
o HittinB the targets of the base achievable model could lead to 10,573,658 totat therms saved.
r HVAC equipment primarily drives the savings for residential customers in the first 5 years of the
study, and then is overtaken by the building envelope for savings starting in year G of the study.
o HVAC equipment primarily drives the savings for commercial customers in the first 5 years of
the study and would continue to do so in the following years.
o Programmable and Smart Thermostats are the highest therm saving measure for residential
customers for the next 5 years (The CPA was later adjusted to delay implementation of the
Federalfurnace equipment standard until 2028 due to the on-going uncertainty of
implementation of this standard, making furnaces the top therm saving measure).
o Boilers are the highest therm saving measure for commercia! customers for the next S years.
o Residentialcustomers represent 2/3 of achievable savings.
There were questions and comments as to whether behavior and retro-commissioning incentives were
taken into account, and a question as to why windows were not on the list of measures discussed with
the greatest savings potential within the short-term future. Dunsky explained savings were blended
Exhibit No.2
Case No. INT€-20-06
lnlermountain Gas Company
Page 14 of 18
across new construction and retrofits, and the different bases were provided for retrofits compared to
new construction. Windows were identified in the measure characterization, but they did not qualify as
a top therm saving measure.
1:30 pm - Open Discussion/Wrap-up
o There was discussion around whether it wouldn't make sense to increase the company's rates
for natural gas, as increased costs organically lead to customers seeking for therm savings,
which is more difficult to do with the inexpensive rates that are currently in place. The Company
explained the process for setting its rates.
o A committee member mentioned that from a policy perspective, other states are beginning to
plan for carbon pricing. ldaho will have to dealwith that to some extent.
o The motivation to spend the ertra cost to do energy efficient measures is reduced by the low
gas rates, however, the program's success comes down to the company's easy form and
response time. Other utilities turn rebates around in 4 months compared to 4 weeks. The
efficiency of how the program is handled is one strength of the program
1:45 pm Meeting Adjourned
Exhibit No. 2
Case No. INT€-2G06
lntermountain Gas Company
Page 15 of 18
lntermountain Gas Energy Efficiency Stakeholder Committee
Meeting
October 9,20L9 at 11:00am
lntermountain Gas Company Conference Center,555 S. Cole Road, Boise, lD g37L4
Minutes Recorded by Kody Thompson
Attendees:
Lori Blattner - lntermountain Gas Company
Cheryl lmlach - lntermountain Gas Company
Brian Bennett - The Energy Auditor, lnc.
Kathy Wold - lntermountain Gas Company
Kody Thompson - lntermountain Gas Company
John Fisk- lntermountain Gas Company
Donn English - ldaho Public Utilities
Commission
Cassie Koerner - ldaho Public Utilities
Commission
Michael Shepard - Neighboruorks
Seth Vanderpool- Brighton Homes
Guests and Presenters:
Lori Blattner- lntermountain Gas Company
Kathy Wold - lntermountain Gas Company
Meeting Facilitator: Kathy Wold
Madison Olson - Office of Energy & Minera!
Resources
Stacey Donohue - ldaho Public Utilities
Commission
Kevin Keyt -
ldaho Public Utilities Commission
Brad lverson-Long - ldaho Public Utilities
Commission
Mike Morrison - tdaho Public Utilities
Commission
Rache! Farnsworth - ldaho Public Utilities
Commission
Kody Thompson - lntermountain Gas Company
Cheryl lmlach - lntermountain Gas Company
11:00 am - lVeeting Convened
Kathy welcomed the group to the meeting and went over general housekeeping, safety
protocols, and an overview of the meeting's agenda.
Exhibit No.2
Case No. INT€-2G06
lntermountain Gas ComPanY
Page '16 of 18
L1:15 am - IGC Update - Lori Blattner
Lori went over highlights of the nearly two-year history of the program. Relevant commission
filings that were submitted recently were discussed, including; determination of prudency of energy
efficiency funds, a request to increase the energy efficiency charge effective October t,2OL9, and the
purchased gas cost adjustment overall decrease effective October L,20L9. The energy savings between
gas being used directly as an energy source versus being used to generate electricity was also discussed
1,1.:20 am - Program Update - Kathy Wold & Kody Thompson
Kathy discussed the annual report for the energy efficiency program having been filed, with
physical copies available at the meeting, noting that an electronic version was available on our website.
It was announced that the online form was publicly available for submitting rebate applications, and
that a new marketing campaign that includes radio and digital ads would be taking place in November.
The cpA is still being worked on. The delay in implementation of DoE's proposed new furnace standard
are being incorporated into the final CpA report. Questions were asked regarding the furnace standard
used in the cpA. A proposed rule change had been made to increase the standard to 90% AFUE effective
2021. That date may now be pushed back to 2028.
Kody gave a brief rundown on the number of rebate measures that had been paid out and
therm savings through second quarter as well as providing a comparison of where the program numbers
were at year end 2018.
11:30 am - EM&V - KathY Wold
Kathy discussed the status of the EM&V process. A request for proposal is being generated
regarding the furnace program., The Company proposed using the QA that RESNET performs on the
Exhibit No. 2
Case No. INT€-2G06
lntemountain Gas Company
Page 17 of 18
whole home rebate programs as the EM&V of that measure. The Company also suggested not
performing EM&V on the water heater and fireplace rebate measures due to their small impact on the
program, the known issues with the measures, and suggested changes that would come from the CpA
study.
Questions were raised as to the effectiveness of using RESNET and the HERS scoring process as
EM&V for the whole home rebate. The Company was encouraged to add the whole home rebate to the
request for proposalfor a third party to evaluate this measure as well. Commlttee members agreed it
made sense to revise the smaller programs and not include them in the study.
12:00 pm - Fine Tuning Residential Program Offering - Kathy Wold
Updates for the residential rebate program were proposed. These included recommending the
end to the 80% AFUE fireplace rebate, increasing the rebate amount and correcting the efficiency rating
designation to the new standard for efficient water heaters, reducing the HERS score on the whole
home rebate to 55 or lower, and to add a smart thermostat rebate program.
Questions were raised as to whether IGC had considered doing a tiered level of incentives for
the whole home rebate program, as well as what value ENERGY STAR adds to the rebate program, and
issues regarding ENERGY STAR credentialed contractors was discussed.
12:30 pm - Lunch
1:00 pm - Plans for 2020 - Kathy Wold
Kathy discussed the plans the Company has for additional residential rebate offerings to be
proposed in 2020, as well as plans to propose a commercial rebate program. Prior to requesting these
changes, a stakeholder meeting will be held to discuss IGC's plans for these expanded offerings, looking
at the measures recommended in the CPA findings.
Exhibit No.2
Case No. INTG-2G06
lntermountain Gas Company
Page 18 of 18
1:20 pm - GTI Presentation - Cheryl lmlach
Cheryl discussed lGCs history with the Gas Technology lnstitute and it's two operating entities:
Utilization Technology Development, and Operations Technology Development. Forthcoming technology
being tested by GTI was discussed, including natural gas fired heat pumps, heat pump water heaters,
and ENERGY STAR dryers. A brief overview was given of the 18-month testing of a rooftop natural gas
heat pump that was hosted at the lntermountain Gas campus as part of a GTI filed trial.
1:30 PM - Tour of IGC campus was given which included the natural gas heat pump
1:55 pm Meeting Adjourned
DilIIBIT NO.3
CASE NO. INT-G-20.06
INTERMOT]NTAIN GAS COMPANY
Avoided Cost Calculation
(17 pages)
Exhibit No. 3
Case No. INTG-2G06
lntermountain Gas Company
Page 1 of17
Avoided Costs
Overview
The avoided cost represents those costs that the Company does not incur as a result of energy
savings generated by its Energy Efficiency Program. The calculation is used both to
economically evaluate the present value of the therms saved over the life span of a measure
and to track the performance of the program as a whole.
Avoided costs are forecasted out 30 years in order to properly assess Energy Efficiency
measures with longer lifespans. This forecast is based on the performance of the Company's
portfolio under expected market conditions.
Costs lncorporated
lntermountain's avoided cost calculation contains the following components
ACnominot= CC + TC + VDC
Where:
o ACnominor = The nominal avoided cost for a given year.
c CC= Commodity Costs
o TC=Transportation Costs
o VDC=Variable Distribution Costs
The following parameters are also used inthe calculation of the avoided cost:
o The assumed forward-looking annual inflation rate is 2.0%.
o The discount rate is derived using lntermountain's tax-effected cost of capital.
o Standard present value and levelized cost methodologies are utilized to develop a
real and nominal levelized avoided cost by year.
Exhibit No. 3
Case No. INT-G-20-06
lntermountain Gas Company
Page 2 ol 17
Understanding Each Component
Commodity Costs
Commodity costs represent the purchase price of the naturat gas molecules that the Company
does not need to buy due to therm savings generated by its Energy Efficiency program. To
calculate the commodity costs, the Company first utilizes price forecasts included in its lntegrated
Resource Plan (lRP) for three primary basins (AECO, Sumas, and Rockies) then weights these
forecasts based on lntermountain's historical day-gas purchase data. Day-gas purchases
represent the first costs that could be avoided through Energy Efficiency program savings. To
account for the seasonal nature of energy savings, the weighted price is shaped by normal
monthly weather, measured in heating degree days with a base of 55 degrees. The original basin
price forecasts span through 2036 and then an escalator is applied through the remainder of the
forecast period. The gas price forecasts will be updated in each lRp ptanning cycle.
Transportation Costs
Transportation costs are the costs the Company incurs to deliver gas to its distribution system.
As the Company's Energy Efficiency Program generates therm savings, the Company can reduce
pipeline capacity needs and monetize any excess capacity to reduce costs for all customers
through credits in the Company's annual Purchased Gas Cost Adjustment (pGA) filing. The
Company calculates the per therm transportation cost as the weighted average of the gas
transportation costs listed on the Company's residential and commerciat tariffs. The nominal
vaf ue of the transportation cost is increased each year by the model inflation rate of 2.O%. The
inflated nominal value is then discounted back to today's dollars as part of the fina! step in the
avoided cost calculation. The Company wi!! update the transportation cost each year to reflect
the most current gas transportation cost as filed in its pGA.
Vo rio b le Distri b uti o n Costs
Variable distribution costs are the avoidable portion of costs incurred by lntermountain to
deliver gas to customers via its distribution system. Lowering gas consumption through the
Company's Energy Efficiency Program allows lntermountain to delay costly capacity
expansion projects and utilize existing pipeline infrastructure more efficiently. While these
cost benefits are intuitively apparent, the Company and its Stakeholder group are
investigating methods to quantify these savings. The Company is currently using a
placeholder value of zero for this component.
Exhibit No. 3
Case No. INT-G-20-06
lntermountain Gas ComPanY
Page 3 of 17
AVOIDED COST BY YEAR
(1 page)
Exhibit No. 3
Case No. INT-G-20-06
lntermountain Gas Company
Page 4 of 17INTERMOUNTAIN GAS COMPANY
Avoided Cost by Year
Line
No.Year
NominalCost
Per ThermtlI
Real Percent
Adjustmentt2l
Real Cost
Per Therm
Present
Valuet3]
Avoided Cost
Per Thermlal
(a)(b)
2019 $
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
(c)(d)(e)(f)
1
2
3
4
5
6
7
8
I
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
0.49
0.49
0.46
0.45
0.46
0.47
0.51
0.52
0.54
0.54
0.56
0.58
0.59
0.60
0.61
0.63
0.64
0.66
0.68
0.70
0.72
0.74
0.76
0.78
0.80
0.82
0.84
0.86
0.89
0.91
-1.82o/o
-8.120/o
-3.760/o
-0.02%
0.14o/o
6.970/o
1.100/o
0.17o/o
-0.45o/o
1.050/o
1.29o/o
0.03%
-0.670/o
0.200/o
0.870/o
0.270/o
0.68%
0.68%
0.69%
0.69%
0.69%
0.70%
0.70o/o
0.700/o
0.70%
0.710/o
0.710/o
0.71o/o
0.710/o
0.49 $
0.48
0.44
0.42
0.42
0.42
0,45
0.46
0.46
0.45
0.46
0.47
0.47
0.46
0.46
0.47
0.47
0.47
0.48
0.48
0.48
0.49
0.49
0.49
0.50
0.50
0.50
0.51
0.51
0.51
0.46 $
0.90
1.28
1.63
1.97
2.29
2.61
2.93
3.23
3.52
3.80
4.07
4.33
4.57
4.80
5.03
5.24
5.45
5.65
5.84
6.03
6.20
6.37
6.54
6.70
6.85
6.99
7.13
7.27
7.40
0.49
0.48
0.47
0.46
0.45
0.45
0.45
0.45
0.45
0.45
0.45
0.45
0.45
0.45
0.45
0.45
0.45
0.45
0.46
0.46
0.46
0.46
0.46
0.46
0.46
0.46
0.46
0.46
0.46
0.46
$
NOTES
111 See Exhibit No. 3, Page 6, Column (e).
121 The year over year percentage change in Column (b), adjusted by the inflation assumption on
Exhibit No. 3, Page 17, Line 4, Column (b).
101 The cumulative present value of Column (d) is calculated using the real discount rate on
Exhibit No. 3, Page 17, Line 5, Column (b).
1r1 Levelized avoided cost of Column (e) computed with the real discount rate on Exhibit No. 3,
Page 17, Line 5, Column (b).
Exhibit No. 3
Case No. INT-G-20-06
lntermountain Gas Company
Page 5 of 17
NOMINAL AVOIDED COST BY YEAR
(1 page)
Exhibit No. 3
Case No. INT-G-20-06
lntermountain Gas Company
Page 6 of 17INTERMOUNTAIN GAS COMPANY
Nominal Avoided Cost by Year
Line
No.Year
Commodity
gsslltltzl
Variable Distribution
Costt3]
Transportation
Costtal
Total
Costtsl
(a)(b)(c)(d)(e)
$1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
2019 $
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
0.31 $
0.30
0.27
0.26
0.26
0.27
0.31
0.32
0.33
0.33
0.34
0.36
0.36
0.37
0.38
0.39
0.40
0.41
0.42
0.44
0.45
0.46
0.48
0.49
0.51
0.52
0.54
0.56
0.57
0.59
0.18 $
0.18
0.19
0.19
0.19
0.20
0.20
0.21
0.21
0.21
0.22
0.22
0.23
0.23
0.24
0.24
0.25
0.25
0.26
0.26
0.27
0.27
0.28
0.28
0.29
0.29
0.30
0.31
0.31
0.32
0.49
0.49
0.46
0.45
0.46
0.47
0.51
0.52
0.54
0.54
0.56
0.58
0.59
0.60
0.61
0.63
0.64
0.66
0.68
0.70
0.72
0.74
0.76
0.78
0.80
0.82
0.84
0.86
0.89
0.91
NOTES
1r1 See Exhibit No. 3, Pages 8-13, Column (f). Divided by 10 to convert units from dekatherms
to therms.
tzl Annual growth after 2036 is tied to yearly percentage change of the prior period.
tst Placeholder value of zero until a Variable Distribution Cost methodology is developed.
p1 See Exhibit No. 3, Page 15, Line 7, Column (d). Annual growth is tied to inflation assumption
on Exhibit No. 3, Page 17, Line 4, Column (b).
1s1 Sum of Columns (b)-(d).
Exhibit No. 3
Case No. INT-G-20-06
lntermountain Gas Company
PageT ol 17
COMMODITY COST
(6 pages)
Exhibit No. 3
Case No. INT-G-20-06
lntermountain Gas Company
Page 8 of 17INTERMOUNTAIN GAS COMPANY
Commodity Cost
Line Heating Weighted Basin
Price Forecastlll
HDD
Weighlt2l
Commodity
Cost
HDD
Factol3INo.Year Month
(a)(b)(c)(d)(e)(0
1
2
3
4
5
6
7
I
I
2019
2019
2019
2019
2019
2019
2019
2019
2019
2019
2019
20't9
2020
2020
2020
2020
2020
2020
2020
2020
2020
2020
2020
2020
2021
2021
2021
2021
2021
2021
2021
2021
2021
2021
2021
2021
10$
11
12
1
2
3
4
5
6
7
8
I
10
11
12
1
2
3
4
5
6
7
8
I
10
11
12
1
2
3
4
5
6
7
8
I
2.59
2.69
3.27
3.32
3.53
3.01
2.77
2.35
2.38
2.94
3.05
2.64
2.59
2.69
3.27
3.32
3.53
3.01
2.77
2.15
2.16
2.60
2.71
2.29
2.30
2.25
2.82
3.05
3.14
2.65
2.46
1.98
2.01
2.39
2.46
2.28
3%$
9%
15%
20o/o
160/o
14o/o
10o/o
7o/o
3o/o
1o/o
0o/o
1%
0.09
0.23
0.49
0.67
0.58
0.44
0.28
0.17
0.08
0.03
0.00
0.02 $3.06
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
3o/o
9o/o
15o/o
20o/o
160/o
14o/o
10o/o
7o/o
3o/o
1o/o
0o/o
1%
3o/o
9%
15o/o
20o/o
160/o
14%
10o/o
7%
3%
1%
0o/o
1o/o
3.03
0.09
0.23
0.49
0.67
0.58
0.44
0.28
0.15
0.07
0.02
0.00
0.01 $
0.08
0.19
0.42
0.61
0.51
0.38
o.25
0.14
0.07
0.02
0.00
0.01 $
NOTES
t'l See Confidential Workpaper No. 1, Column (i).
l2l Monthly HDD65 weighting. Based on a normal weather year
t3lColumn (c) times Column (d).
2.70
INTERMOUNTAIN GAS COMPANY
Commodity Cost
Exhibit No. 3
Case No. INT-G-20-06
lntermountain Gas ComPanY
Page I of 17
Commodity
Cost
Line Heating
Year Month
HDD
Weiqhtl2l
HDD
Factol3l
Weighted Basin
Price ForecasttllNo
(a)(b)(c)(d)(e)(f)
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
2022
2022
2022
2022
2022
2022
2022
2022
2022
2022
2022
2022
2023
2023
2023
2023
2023
2023
2023
2023
2023
2023
2023
2023
2024
2024
2024
2024
2024
2024
2024
2024
2024
2024
2024
2024
10$
11
12
1
2
3
4
5
6
7
8
I
10
11
12
1
2
3
4
5
6
7
8
I
10
11
12
1
2
3
4
5
6
7
8
I
2.29
2.33
2.77
2.97
2.87
2.41
2.27
1.93
2.05
2.36
2.41
2.37
2.34
2.44
2.82
3.01
2.94
2.43
2.31
1.97
2.09
2,45
2.49
2.45
2.44
2.55
2.69
2.91
3.13
2.58
2.44
2.13
2.23
2.54
2.57
2.54
3%$
9o/o
15o/o
20%
160/o
14o/o
10o/o
0.08
0.20
0.41
0.60
0.47
0.35
0.23
0.14
0.07
0.02
0.00
0.0'l
7o/o
3o/o
1o/o
0o/o
1o/o
3o/o
9o/o
15o/o
20o/o
16%
14o/o
1Oo/o
7o/o
3o/o
1o/o
lYo
1o/o
3o/o
9o/o
15o/o
0.08
0.21
0.42
0.60
0.48
0.35
0.23
0.14
0.07
0.02
0.00
0.01 $2.63
$2.58
20%
160/o
14o/o
10o/o
7o/o
3o/o
1%
0o/o
1o/o
0.08
0.22
0.40
0.59
0.51
0.37
0.24
0.15
0.08
0.02
0.00
0.02 $
NOTES
l'l See Confidential Workpaper No. 1, Column (i).
t21 Monthly HDD65 weighting. Based on a normal weather year
ttl Column (c) times Column (d).
2.69
INTERMOUNTAIN GAS COMPANY
Commodity Gost
Exhibit No. 3
Case No. INT-G-20-06
lntermountain Gas Company
Page 10 of 17
Line Heating
Year
Weighted Basin
Price Forecasttll
HDD
Weightt2l
HDD
Factol3l
Commodity
CostNo.Month
(a)(b)(c)(d)(e)(f)
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
2025
2025
2025
2025
2025
2025
2025
2025
2025
2025
2025
2025
2026
2026
2026
2026
2026
2026
2026
2026
2026
2026
2026
2026
2027
2027
2027
2027
2027
2027
2027
2027
2027
2027
2027
2027
10$
11
12
1
2
3
4
5
6
7
8
9
10
11
12
1
2
3
4
5
6
7
8
I
10
11
't2
1
2
3
4
5
6
7
I
I
2.61
2.62
3.11
3.33
3.49
3.05
2.92
2.55
2.58
2.92
3.02
2.74
2.74
2.75
3.24
3.45
3.61
3.16
3.02
2.67
2.68
3.02
3.13
2.86
2.85
2.86
3.34
3.51
3.66
3.23
3.08
2.74
2.74
3.09
3.20
2.92
3%$
9o/o
15o/o
20o/o
16%
14o/o
10o/o
7%
3o/o
1o/o
0o/o
1%
0.09
0.22
0.46
0.67
0.57
0.44
0.29
0.18
0.09
0.03
0.00
0.02 $3.07
3%
9o/o
15o/o
20o/o
16%
14o/o
10o/o
7o/o
3o/o
1o/o
0o/o
1%
3o/o
9o/o
15o/o
20o/o
16%
14o/o
'to%
7%
3o/o
1o/o
0o/o
104
0.10
0.24
0.48
0.69
0.59
0.46
0.30
0.19
0.09
0.03
0.00
0.02 $3.19
0.10
0.24
0.50
0.70
0.60
0.47
0.31
0.19
0.09
0.03
0.00
0.02 $
NOTES
t'l See Confidential Workpaper No. 1, Column (i).
t2l Monthly HDD65 weighting. Based on a normalweather year
t31 Column (c) times Column (d).
3.26
Exhibit No. 3
Case No. INT-G-20-06
lntermountain Gas ComPanY
Page11of17
INTERMOUNTAIN GAS COMPANY
Commodity Cost
Line
No.
Heating
Year Month
Weighted Basin
Price Forecasttll
HDD
Weiqhtt2l
HDD
Factol3I
Commodity
Cost
(a)(b)(c)(d)(e)(f)
I
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
2028
2028
2028
2028
2028
2028
2028
2028
2028
2028
2028
2028
2029
2029
2029
2029
2025
2029
2029
2029
2029
2029
2029
2029
2030
2030
2030
2030
2030
2030
2030
2030
2030
2030
2030
2030
10$
11
12
1
2
3
4
5
6
7
8
9
10
11
12
1
2
3
4
5
6
7
8
I
10
11
12
1
2
3
4
5
6
7
8
9
2.92
2.92
3.39
3.55
3.67
3.29
3.12
2.77
2.79
3.13
3.25
2.99
2.99
3.00
3.46
3.69
3.81
3.44
3.24
2.91
2.91
3.28
3.39
3.13
3.14
3.15
3.61
3.83
3.96
3.57
3.36
3.03
3.04
3.39
3.50
3.26
3%
9o/o
15%
20o/o
16%
14%
10%
7%
3o/o
1o/o
Oo/o
1o/o
3o/o
9o/o
15o/o
20o/o
160/o
14o/o
10o/o
7o/o
3o/o
1%
0o/o
1o/o
3o/o
9o/o
15o/o
$0.10
0.25
0.50
0.71
0.60
0.48
0.31
0.20
0.10
0.03
0.00
0.02 $3.30
0.10
0.26
0.51
0.74
0.62
0.50
0.32
0.21
0.10
0.03
0.00
0.02 $3.42
20o/o
160/o
14o/o
10o/o
7o/o
30h
1o/o
0o/o
1%
0.11
0.27
0.54
0.77
0.65
0.52
0.34
0.22
0.10
0.03
0.00
0.02 $
NOTES
t'l See Confidential Workpaper No. 1, Column (i).
l2l Monthly HDD65 weighting. Based on a normal weather year
t3l Column (c) times Column (d).
3.56
INTERMOUNTAIN GAS COMPANY
Commodity Gost
Exhibit No. 3
Gase No. INT-G-20-06
lntermountain Gas Company
Page 12 ol 17
Commodity
Cost
Line Heating
YearNo.Month
HDD
Weightt2l
HDD
Factol3I
Weighted Basin
Price Forecasttll
(a)(b)
2031
2031
2031
2031
2031
2031
2031
2031
2031
2031
2031
2031
2032
2032
2032
2032
2032
2032
2032
2032
2032
2032
2032
2032
2033
2033
2033
2033
2033
2033
2033
2033
2033
2033
2033
2033
(c)(d)(e)(f)
1
2
3
4
5
6
7
8I
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
10$
11
12
1
2
3
4
5
6
7
8
I
10
11
12
1
2
3
4
5
6
7
8
9
10
11
12
1
2
3
4
5
6
7
8
9
3.26
3.28
3.75
3.89
4.02
3.61
3.41
3.08
3.10
3.45
3.54
3.31
3.31
3.33
3.80
3.91
4.04
3.65
3.44
3.10
3.14
3.49
3.57
3.34
3.34
3.37
3.84
4.02
4.15
3.75
3.53
3.20
3.24
3.60
3.67
3.46
3o/o
9o/o
15o/o
20%
160/o
14o/o
10%
7%
3%
1o/o
0%
1o/o
3o/o
9o/o
15o/o
20o/o
160/o
14o/o
1Oo/o
7%
3o/o
'lo/o
o%
'l%
3o/o
9%
15o/o
20o/o
'160/0
14o/o
10o/o
7o/o
3o/o
1o/o
0%
1%
0.11
0.28
0.56
0.78
0.66
0.52
0.34
0.22
0.11
0.03
0.00
0.02 $3.64
$
0.11
0.29
0.56
0.79
0.66
0.53
0.34
0.22
0.11
0.03
0.00
0.02 $3.67
0.12
0.29
0.57
0.81
0.68
0.54
0.35
0.23
0.11
0.03
0.00
0.02 $
NOTES
t'l See Confidential Workpaper No. 1, Column (i).
l2l Monthly HDD65 weighting. Based on a normal weather year
t3l Column (c) times Column (d).
3.75
Exhibit No. 3
Case No. INT-G-20-06
lntermountain Gas Company
Page 13 of 17
INTERMOUNTAIN GAS COMPANY
Commodity Cost
Line Heating
Year
Weighted Basin
Price Forecasttll
HDD
Weighlt2l
HDD
Factol3I
Commodity
CostNo.Month
(a)(b)(c)(d)(e)(f)
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
2034
2034
2034
2034
2034
2034
2034
2034
2034
2034
2034
2034
2035
2035
2035
2035
2035
2035
2035
2035
2035
2035
2035
2035
2036
2036
2036
2036
2036
2036
2036
2036
2036
2036
2036
2036
10$
11
12
1
2
3
4
5
6
7
8
9
10
11
12
1
2
3
4
5
6
7
8
9
10
11
12
1
2
3
4
5
6
7
8
I
3.45
3.49
3.97
4.15
4.27
3.88
3.67
3.34
3.36
3.72
3.82
3.60
3.60
3.63
4.11
4.21
4.35
3.96
3.76
3.44
3.44
3.79
3.91
3.65
3.66
3.65
4.14
4.37
4.61
4.08
3.94
3.45
3.51
4.00
4.14
3.66
3%$
9o/o
'150/o
20o/o
160/o
14o/o
1Oo/o
7o/o
3o/o
1o/o
lYo
1%
0.12
0.30
0.59
0.83
0.70
0.56
0.37
0.24
0.11
0.04
0.00
0.02 $3.88
3o/o
9%
15o/o
2Oo/o
160/o
14o/o
1Oo/o
7o/o
3o/o
1%
0%
1o/o
3o/o
9o/o
15o/o
20%
160/o
14%
1Oo/o
7o/o
3o/o
1o/o
0%
1o/o
0.12
0.31
0.61
0.85
0.71
0.57
0.38
0.24
0.12
0.04
0.00
0.02 $3.98
0.13
0.31
0.61
0.88
0.75
0.59
0.40
0.25
0.12
0.04
0.00
0.02 $
NOTES
l'l See Confidential Workpaper No. 1, Column (i).
t2l Monthly HDD65 weighting. Based on a normal weather year
I'l Column (c) times Column (d).
4.10
Exhibit No. 3
Case No. INT-G-20-06
lntermountain Gas Company
Page 14 of 17
AVOIDED GAS TRANSPORTATION COST
(1 page)
Exhibit No. 3
Case No. INT-G-20-06
lntermountain Gas Company
Page 15 of 17
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Exhibit No. 3
Case No. INT-G-2G06
lntermountain Gas Company
Page 16 of 17
DISCOT]NT RATE
(1 page)
Exhibit No. 3
Case No. INT-G-20-06
lntermountain Gas Company
Page 17 of 17
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