20220927Final_Order_No_35539.pdf

ORDER NO. 35539 1

Office of the Secretary
Service Date
September 27, 2022

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

On August 10, 2022, Intermountain Gas Company (“Company”), applied for authority
to revise the Residential Energy Efficiency Charge (“EEC-RS”) rate schedule. The Company’s
Application requests authorization to provide a one-time credit of $4,850,000 from the Company’s
Residential Energy Efficiency Program (“EE-RS Program”) deferral balance to residential
customers through the Company's Purchased Gas Cost Adjustment (“PGA”) filing, Case No. INT-
G-22-04. The Company also requests authorization to decrease the EEC-RS rate from $0.02093
per therm to $0.01564 per therm, effective October 1,2022. Application at 5. The Company
requested its Application be processed by modified procedure with an effective date of October 1,
2022.
On August 17, 2022, the Commission issued a Notice of Application and Notice of
Modified Procedure establishing public comment and Company reply deadlines. Order No. 35507.
Commission Staff filed comments to which the Company did not reply. No other public comments
were received.
Having reviewed the record, the Commission now issues this Order approving the
Company’s Application.
BACKGROUND
The Commission authorized the Company’s current EEC-RS rate of $0.02093 in Order
No. 34454, Case No. INT-G-19-05. The Company’s EEC-RS funds its EE-RS Program. The
Company represented that its current EEC-RS was based on total annual expenditures of
$3,944,642, that include direct rebate expenses, personnel expenses, program delivery, and ramp-
up expenses. Application at 4-5. Additionally, the Company calculated an under-collected balance
of $1,097,907 through June 2019. Id. In total, the Company estimated an annual EE-RS program
funding amount of $5,042,549. Id.

IN THE MATTER OF INTERMOUNTAIN
GAS COMPANY’S APPLICATION FOR
AUTHORITY TO REVISE RATE
SCHEDULE EEC-RS-RESIDENTIAL
ENERGY EFFICENCY CHARGE
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CASE NO. INT-G-22-05

ORDER NO. 35539
ORDER NO. 35539 2

THE APPLICATION
The Company’s Application proposes a one-time credit of $4.85 million of the
residential deferral balance to residential customers through the PGA, and a decrease in the EEC-
RS rate from $0.02093 per therm to $0.01564 per therm. The Company represented that an EEC-
RS rate schedule decrease is necessary to reflect actual participation in the energy efficiency
program and changes in the rebate programs and amounts. The Company stated that the proposed
decrease, if approved, would result in the average residential customer’s monthly bill decreasing
by $0.33 (through the PGA).
The Company represents that, as of June 30, 2022, it had an over-collected EEC-RS
program balance, which it is addressing through its Case No. INT-G-22-04 PGA filing, and that
the decrease in the EEC-RS schedule will accurately match revenues with expenses based on its
forecasts. The Company represents that participation in energy efficiency programs have grown,
albeit at a slower rate than forecast.
STAFF COMMENTS
Staff reviewed the Company’s Application, Workpapers, and Exhibits. Staff also
verified the documented calculations, and concluded that the Company’s request to decrease the
EEC-RS per therm rate from $0.02093 to $0.01564 was reasonable. Staff recommended that the
Commission approve the Company’s Application and tariffs as filed, decreasing the EEC-RS rate
to $0.01564 per therm. Staff supported the one-time transfer of $4.85 million of the over-collected
residential rider balance to residential customers through the Company’s PGA (Case No. INT-G-
22-04), as amortized to residential customers on a cents per therm basis.
Although Staff verified the Company’s documentation and supported the reasoning for
the proposed changes, Staff did note that the Company’s forecasted labor expenses increase of 5%
might not be warranted, and that the reasonableness of labor increases and expenses would be
addressed in the next general rate case, and in regular prudency filings. Staff also expects the
Company to closely monitor the rider balance and adjust the EEC-RS when necessary to avoid
significant over- or under-collected balances in the future. Staff cautioned the Company about an
80/20 split for expenses between the residential and commercial programs, and when possible,
encouraged the Company to directly assign costs to a specific program. Staff did not address the
Company’s DSM prudency or its actual cost-effectiveness calculations of its programs in its
comments in this case.
ORDER NO. 35539 3

COMMISSION FINDINGS AND DECISION
The Company is a gas corporation and public utility, and the Commission has
jurisdiction over it and the issues in this case under Title 61 of the Idaho Code, and more
specifically, Idaho Code §§ 61-117, 61-129, 61-307, 61-501, and 61-502. The Commission must
establish just, reasonable, and sufficient rates for utilities subject to its jurisdiction. Idaho Code §
61-502.
Based on our review of the record, we find that the Company’s request to revise its
EEC-RS rate schedule, and transfer the $4.85 million over-collected balance in the EEC-RS
deferral balance to the PGA to provide a credit to residential customers is fair, just and reasonable.
This adjustment is necessary to reflect actual participation in the EE-RS Program, and changes in
the rebate programs and amounts that have occurred since April 2021.
The Commission makes no finding or determination regarding the reasonableness or
prudency of the Company’s individual DSM activities or expenses in this case. We also cannot
determine at this point the accuracy of the Company’s forecasted increases in labor costs.
However, the Company’s forecasts on labor expenses are a reasonable starting point, and we
remind the Company to monitor and evaluate the labor costs, and the rider balance to avoid
significant under- or over-collected balances. While the Commission prefers that costs are directly
assigned to a program, the Commission finds that the Company’s 80/20 split for expenses between
the residential and commercial programs appears reasonable. Thus, the Commission accepts the
Company’s reasoning for its proposed changes.
ORDER
IT IS HEREBY ORDERED that the Company’s Application to decrease the EEC-RS
rate to $0.01564 per therm is approved, as filed.
IT IS FURTHER ORDERED that the Company’s proposed transfer of $4.85 million
of the over-collected residential balance to provide a credit residential customers through the
Company’s PGA, is approved, as filed.
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within twenty-one (21) days of the service date of this Order regarding any matter
decided in this Order. Within seven (7) days after any person has petitioned for reconsideration,
any other person may cross-petition for reconsideration. Idaho Code § 61-626.

ORDER NO. 35539 4

DONE by Order of the Public Utilities Commission at Boise, Idaho this 27th day of
September 2022.

ERIC ANDERSON, PRESIDENT

JOHN CHATBURN, COMMISSIONER

JOHN R. HAMMOND JR., COMMISSIONER

ATTEST:

Jan Noriyuki
Commission Secretary

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