20060313_1494.pdf

DECISION MEMORANDUM
TO:CO MMISSI 0 NER KJELLAND ER
COMMISSIONER SMITH
CO MMISSI 0 NER HANSEN
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL
FROM:DONOV AN E. WALKER
DATE:MARCH 10,2006
SUBJECT:IDAHO POWER'S APPLICATION TO CONTINUE ITS TIME OF USE
ENERGY PRICING PILOT PROGRAMS - CASE NO. IPC-06-
On March 3, 2006, Idaho Power filed an Application for authority to continue its two
time-of-use energy pricing pilot programs for customers in the Emmett Valley. The pilot
programs were approved in March 2005. Order No. 29737, Case No. IPC-05-2. The
programs are currently scheduled to expire on April I , 2006. The Company proposes to extend
the programs for an additional year, allowing those that participated in 2005 to continue if they
so desire and also soliciting new participants.
Because the current pilot programs are set to expire on April 1 , 2006, the Company
requests: processing its Application on an expedited basis; or alternatively, issue an interlocutory
order extending the effectiveness of the pilot programs for a sufficient time to allow the
Commission to fully consider the Application. If the Commission chooses to extend the
effectiveness of the programs pending its consideration of the Application the Company requests
a schedule that would allow an Order to be issued in mid to late April, to allow sufficient lead
time to allow activation of the new programs by June 1 , 2006. The Company requests
processing its Application by Modified Procedure.
THE APPLICATION
The current programs, Schedule 4, Energy Watch Pilot Program, and Schedule 5
Time-of-Use Pilot Program, were approved in March 2005 to run through April 1 , 2006. Order
No. 29737, Case No. IPC-05-2. The programs are voluntary options available to all residential
customers in the Emmett Valley who have AMR metering installed.
DECISION MEMORANDUM
Idaho Power employed Northwest Research Group to conduct a customer survey and
RL W Analytics to analyze the usage and billing data associated with these programs. The
Company states in its Application that the detailed results of these pilot programs will be
included in the Company s report to the Commission, to be submitted on or before April 1 , 2006
in compliance with Order No. 29737. Application at 2.
The Company reports that a preliminary evaluation of the programs shows that the
participant retention rate was high. The Energy Watch program began with 79 participants and
retained 76 by the end of August 2005. The Time-of-Day program began with 95 participants
and retained 92. Application at 3. Preliminary results suggest that on average customers
benefited by participating in the programs. Id. Time-of-Day participants, on average, saved
about 5 percent on their bills and Energy Watch participants, on average, saved about 10 percent
on their bills when compared with control groups with similar usage taking service under
Schedule 1. Id. The Company states that the energy load shift, or decrease in usage, for the
Time-of-Day participants, although apparent, was not statistically significant. Id. The Energy
Watch participants, on average, demonstrated a statistically significant demand reduction during
the Energy Watch hours, reducing their household demand by 1.33 kW for all Energy Watch
hours. Id. Additionally, the Company reports that preliminary evaluation ofthe customer survey
indicates: participants were satisfied with the programs; 60% of those responding indicated they
would participate again; and 50% responded that they would recommend these programs to
others. Id.
The Company is not proposing any changes to the Energy Watch program, Schedule
4. Application at 5. The Company is proposing a change in the availability of both pilot
programs, in that program participation be limited to those customers whose energy usage equals
or exceeds 300 kWh for each of the most recent 12 consecutive billing periods or for all billing
periods if the customer has less than 12 months of billing history. Application at 4. The
Company is proposing to change the rates for the time-of day pricing periods by increasing the
price differential between on-peak, off-peak, and mid-peak rates. Application at 7.
increasing the differentials between time-of-day pricing periods, the Company intends to
increase the financial incentive for customers to shift their energy usage. Along with its
Application the Company filed proposed tariff sheets for both Schedule 4 and Schedule 5 that
provide for the continuation and changes to the pilot programs.
DECISION MEMORANDUM
STAFF RECOMMENDATION
Staff has reviewed the Company s March 3 2006, Application and does not oppose a
continuation of the pilot programs past the April 1 , 2006, expiration and recommends that the
Commission issue an Order that would allow the programs to continue past this date. However
Staff has not yet seen the report nor any detailed results compiled by the Company regarding the
past year of operating the pilot programs. Staff is not yet in a position that it can recommend an
appropriate time period for processing the Company s request or changes to the programs. The
Company has stated that the detailed report will be filed by April 1 , 2006. Staff will work with
the Company on obtaining information about the pilot programs, and once Staff is able to review
the report it can further advise the Commission regarding Modified Procedure and scheduling on
this Application. Staff recommends that a Notice of the Company s Application be issued, as
well as an Order authorizing the Company to continue the two pilot programs past the April 1
2006, expiration date.
COMMISSION DECISION
Does the Commission wish to process this Application on an expedited basis prior to
the April 1 , 2006, expiration of the current pilot programs?
If not, does the Commission wish to issue an Order authorizing the continuation of
the pilot programs past their April 1 , 2006, expiration?
Does the Commission wish to issue a Notice ofthe Company s Application?
Does the Commission wish to authorize the use of Modified Procedure and establish
a comment deadline?
Does the Commission wish to wait for Staff to review the Company s report and
make a recommendation regarding Modified Procedure and a schedule for processing the
Application?
NOV AN E. WALKER
DECISION MEMORANDUM