Case No. PAC-E-05-10, Order No. 29976

March 3, 2006

Contact: Gene Fadness (208) 334-0339




Commission approves 1.5 percent rider for Utah Power customers


The Idaho Public Utilities Commission is approving a 1.5 percent rider to the bills of PacifiCorp’s 62,000 customers in southeastern Idaho to fund energy conservation programs. The commission believes the DSM (demand-side management) rider is cost-effective for customers because the efficiency programs preclude or delay the utility’s need to build additional power plants or buy power from other sources to meet growing customer demand.


The rider will add about $1 to the monthly bill of an average residential customer who uses 790 kilowatt-hours a month. The commission approved the rider, which becomes effective May 1, on a 2-1 vote with Commissioner Dennis Hansen dissenting from Commissioners Paul Kjellander and Marsha Smith. Hansen said he supports well-planned DSM programs, but believes one of PacifiCorp’s programs to pay customers to dispose of inefficient refrigerators and freezers is not cost-effective.


The commission delayed approval of an earlier proposal by PacifiCorp, which does business in southeastern Idaho as Utah Power, because the array of programs offered provided more benefit for other customer classes than they did for the residential class. Utah Power later submitted a revised proposal that provides a Home Energy Efficiency Incentive program for residential customers, though details of that program are not yet finalized.


Some of the programs offered will include:


n      An irrigation efficiency program to complement an existing irrigation load control program. The program offers irrigators no-cost equipment exchange, equipment testing and financial incentives for energy efficiency measures.

n      Energy efficiency measures for commercial and industrial customers that include efficient lighting, premium motors and mechanical upgrades associated with heating and cooling.

n      Incentives to promote home energy efficiencies involving appliances, water heaters, lighting, heating and cooling equipment, windows and insulation. More specific details of this program are to be submitted to the commission by no later than April 30.

n      A refrigerator-recycling program for residential customers called “See Ya Later Refrigerator.” The program offers incentives to homeowners and landlords to discontinue use of second refrigerators and freezers or replace them with more energy efficient models. The company estimates more than $3 in benefits for each $1 in program costs.

n      An increase in Utah Power’s low-income weatherization program to $150,000 from $100,000 and an increase in the maximum rebate allowed per weatherized home from $1,000 to $1,500.


The commission said cost-effective DSM programs provide benefits even to non-participants because the programs reduce the company’s overall cost of serving its customers. It also benefits all Idaho customers by reducing Idaho’s allocation of PacifiCorp’s power supply costs in its six-state territory.


In his dissenting opinion, Commissioner Hansen said the “See Ya Later Refrigerator” program costs are excessive and could range from $187 to $300 per refrigerator. He said it will cost Utah Power $84,000 to manage the program regardless of the amount of refrigerators recycled.


“I cannot, in good conscience, support an additional 1.5 percent increase ($3.6 million over two years) to Idaho customers who are already burdened with record-high utility bills resulting from the current huge increases in energy costs,” Hansen said.


Hansen also expressed concern that the 1.5 percent increase could be overly burdensome on irrigation customers with pumping operations and residential customers with total electric homes.


Once the programs are in place, Utah Power will be required to file a report with the commission demonstrating their cost-effectiveness. All expenses related to the programs will be kept in a deferred account and rebated to customers or invested in new programs if the programs proposed by the company are not found to be cost-effective.


“While it is obviously too early to assess the cost-effectiveness of any of the proposed programs, we believe the programs chosen show promise, based on the company’s preliminary estimates,” Commissioners Kjellander and Smith said. “We find, based on company projections, that DSM provides a more cost-effective alternative than new supply resources.”


A full text of the commission’s order, along with other documents related to this case, are available on the commission’s Web site at Click on “File Room” and then on “Electric Cases” and scroll down to Case No. PAC-E-05-10.


Interested parties may petition the commission for reconsideration by no later than March 24. Petitions for reconsideration must set forth specifically why the petitioner contends that the order is unreasonable, unlawful or erroneous. Petitions should include a statement of the nature and quantity of evidence the petitioner will offer if reconsideration is granted.


Petitions can be delivered to the commission at 472 W. Washington St. in Boise, mailed to P.O. Box 83720, Boise, ID, 83720-0074, or faxed to 208-334-3762.