20221110Comments.pdf

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JAYME B. SULLIVAN
BOISE CITY ATTORNEY
Ed Jewell ISB No. 10446
Deputy City Attomey
BOISE CITY ATTORNEY'S OFFICE
150 N. Capitol Blvd.
P.O. Box 500
Boise,ID 83701-0500
Telephone: [phone]
Facsimile: (208) 384-445 4
Email: BoiseCityAttorney(rrcityofboise. ore
ei [e-mail]
Attorney for Intervenor
IN THE MATTER OF THE APPLICATION OF
INTERMOUNTAIN GAS COMPANY FOR A
DETERMINATION OF 2O2I ENERGY
EFFICIENCY EXPENSES AS PRUDENTLY
INCURRED
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
Case No. INT-G-22-03
CITY OF BOISE CITY'S
COMMENTS
The city of Boise City ("Boise City") submits these formal comments on the application
submitted by Intermountain Gas Company ("Company") for a determination of 2021 energy
efficiency program expenses as prudently incurred. Boise City, pursuant to Rule 203 of the
Commission's Rules of Procedure, IDAPA 31.01.01.203, and pursuant to the Notice of Modified
Procedure, Order No. 35521, issued by the Commission on September2,2022, hereby submits its
formal wriffen comments and states as follows:
l. Boise City commends the Company on continuing to develop and implement new energy
efficiency programs, particularly with the challenges faced during the COVID-l9
pandemic and supply chain disruptions. Boise City recognizes the unique and important
CITY OF BOTSE CITY'S COMMENTS - 1
benefits that energy efficiency delivers to all customers and supports the continuation of
robust, accessible, and cost-effective energy efficiency measures. Boise City is encouraged
by the Company's efforts to expand energy efficiency program participation, resulting in a
22%o rncrease in rebates to customers from 2020 to 2021. Application at 10. Boise City
specifically recognizes the Company's efforts to establish a commercial energy efficiency
progrcm and looks forward to the results from the first full year of commercial program
operation lr,2022.
2. Comparing savings from 2021 to 2020 is challenging with the substantial changes made to
the Whole Home rebate program, updated thenn savings for several measures, and
elimination of billing analysis in the 2021 cost-effectiveness testing. Boise City believes
the reported 46L,690 therm savings attributed to the Whole Home rebate program, in effect
from January ls through March 31't, are likely overstated. A key factor in revising the
Whole Home rebate and introducing an updated, tiered approach was the significant
difference in therm savings identified in the simulation (274 therms) and billing (58 therms)
analyses. INT-G-21-03 Application at 8. If the 58 therrr savings value is used to assess the
retired Whole Home rebate, the UCT ratio is reduced from 1.6 to 0.3 and the overall
program falls to a UCT ratio of 0.7. With the sunsetting of the original Whole Home rebate,
it would be more accurate to report the savings separately and look at the residential energy
efficiency program offerings with only the updated Whole Home I and Whole Home II
tiered rebates. Removing the original Whole Home rebate savings and costs, yields an
overall program UCT ratio of 1.3, using the Company's deemed savings approach.
3. Boise City is concerned by the Company's decision and supporting reasoning for adopting
a simulated or deemed savings evaluation for the updated Whole Home I and II rebates.
CITY OF BOISE CITY'S COMMENTS - 2
As noted above, significant restructuring of the rebate was needed to align the new
construction rebate with natural gas saving opportunities. Boise City is concerned that
without billing analysis it is unclear if the adopted changes created a cost-effective energy
efficiency incentive or if it requires existing residential customers to further subsidize the
connection of new customers. The Company incorrectly quotes guidance from the SEE
Action Energy Efficiency Program Impact Evaluation ("SEE") in its justification for why
a deemed savings analysis is more appropriate than a billing or large consumption data
analysis methodology. In the Company's Response to the First Production Request of
Commission StaffRequestNo. 2, the Company states:
lt is also important to employ the proper method for the evaluation. SEE stated
large consumption data analysis methods "are primarily used for evaluations of
residential behavior-based programs, whole house retrofits, and weatherization."
4. Boise City agrees that it is important to identifr the right method for evaluation for the
program type but notes SEE section 4.4.3 detailing the Large-Scale Consumption Data
Analysis Approach actually states billing "approaches are used for programs that have
many participants that share many corrmon characteristics, such as single-family detached
homes in a particular community with residents of similar economic demographics. These
can be equipment retrofits, new construction, or behavior-based programs." SrevEN R.
ScHtLLeR, Srerr AND Locel ENpncv ErrtcteNcy Aclou NETwoRK, ENERcv
ErrrcrnNcy PnocRau hapacr EvaluenoN Guton p. 4-13 available at
https://www.enerqy.sov/sites/de1'ault/files/2014/05/fl5/emv eeJroeram impact_guide.p
df (last visited October 18,2022). SEE goes on to identi$, criteria applicable for large-
scale consumption data analysis, including relatively large number of participants (greater
CITY OF BOTSE CITY'S COMMENTS - 3
than 100), clearly defined participation, and data availability, that the Company's Whole
Home rebate program meets.
5. Boise City recommends the Commission direct the Company to designate the Whole Home
I and II rebates as pilot programs and commission a third-party Evaluation, Measurement
and Verification ("EM&V") of the Whole Home I and II rebates paid through 2022wng
a billing analysis methodology. Upon review of the results of the EM&V, the Company
could then propose modifications to its residential new constnrction efficiency offerings to
the Commission or if cost-effective, incorporate them as a standard offering in the overall
residential energy efficiency program in its 2022 energy efficiency expense prudency
proceeding. Without these modifications, Boise City believes the Company should be
directed to suspend its Whole Home I and II rebate offerings due to the Company's failure
to comply with the Commission's repeated directive to "provide a detailed and convincing
defense" of its selected evaluation method and the continued cost-effectiveness
uncertainty. See Order No. 33980 at 8, and Order No. 35313 at 5.
6. Boise City continues to recommend the Company evaluate and present a targeted,
behavioral energy efficiency program offering to its Energy Efficiency Savings Committee
for future implementation. A behavior-change focused offering could lead to significant
savings without the taditional overhead expenses or customer costs associated with current
equipment replacement rebates.
7. In addition to new progftrm offerings, Boise City continues to recommend the Company
evaluate and incorporate a risk premium in the avoided cost model. A specific value
reflecting the risks of price volatility and uncertainty in the future pricing of wholesale
energy would more comprehensively value the role that only energy efficiency can deliver
CITY OF BOISE CITY'S COMMENTS - 4
in reducing the Company's and customers' exposure to rapidly changing market
conditions. In INT-G-22-04, the Commission approved the Company's application to
update its rates to reflect a new weighted average cost of gas ("WACOG") amount of
$0.39216 per therm, a significantly higher WACOG than the $0.26000 approved in Order
No. 35182 issued in September 2021. Recent natural gas market volatility emphasizes the
need to more comprehensively value fuel price risk in the Company's avoided cost
methodology. The American Council for an Energy Efficient Economy report "Sustaining
Utility Natural Gas Efficiency Programs in a Time of Low Gas Prices" outlines different
methodologies in use by natural gas utilities to accurately incorporate a risk premium.
MeRrrN Kusulen & Perrre WHITE, AunrucaN CouNcrr- FoR AN ENrRcv ErnclENr
EcoNovty, SusrerNrNc urrLITy NATURAL GAS EFFTcIENCv pRocRAMS rN A TrME oF Low
Ges Prucrs p. 19 available at
https://www.aceee.ors/sites/default/files/pdfs/sustaininLutility-natural_gas_efficiencyJ
rosrams.pdf (last visited October 18,202L).
8. Boise City recommends the Commission find the Company's 2020 energy efficiency
expenses prudently incurred and direct the Company to modiff its Whole Home I and II
rebates to be identified as pilot programs, and to amend its EM&V schedule to evaluate
Whole Home I and II rebates paid through2022 using a billing analysis evaluation.
DATED this lOth day of November 2022.
P&*Ll
Ed JefteD
Deputy City Attorney
CITY OF BOISE CITY'S COMMENTS - 5
CERTTFICATE OF SERVICE
I hereby certiff that I have on this l0th day of November 2022, served the foregoing
documents on all parties of counsel as follows:
JanNoriyuki
Commission Secretary
Idaho Public Utilities Commission
11331 W. Chinden Blvd., Bldg No. 8, Suite
201-A (83714)
PO Box 83720
Boise, tD 83720-0074
lan.non idaho.sov
Preston N. Carter
Givens Pursley LLP
601 W. Bannock St.
Boise,Idaho 83702
prestoncarter(a) qivenspurslev. com
stephaniew@ givenspursl ey.com
Lori Blattner
Director - Regulatory Affairs
lntermountain Gas Company
P.O. Box 7608
Boise, ID 83707
Lori. B lattner(rD inteas.com
Chris Burdin
Deputy Attorney General
Idaho Public Utilities Commission
I l33l W. Chinden Blvd., Bldg No. 8, Suite
201-A (83714)
PO Box 83720
Boise, lD 83720-0074
chris.burdin(rDpuc. idaho. eov
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Michelle Steel
Paralegal, City of Boise
CITY OF BOISE CITY'S COMMENTS - 6