Idaho Taking Comments
by Rebecca Meany
Plan includes incentives, penalties for Idaho Power's efforts
Idaho Power Co. is seeking approval from the Idaho Public Utilities Commission for two pilot programs to encourage energy efficiency. One, IPC-E-04-15, would allow an annual increase to customers' electric rates if company investments in energy efficiency programs increase company costs. In other words, the plan would prevent the company from losing money when it invests in such programs.
The other, IPC-E-06-32, would give the company financial incentives for meeting performance levels in a program to encourage energy-efficient home construction. It would also penalize Idaho Power if it fails to meet goals.
The Idaho Public Utilities Commission is taking public comments on the plans until Jan. 31.
The plans require Idaho Power to increase the size and availability of energy efficiency programs and to support more energy efficient building and energy codes.
"This is part of a nationwide effort at promoting energy efficiency," said utilities commission spokesman Gene Fadness.
In exchange for invigorated energy efficiency efforts, Idaho Power's rates will be "de-coupled" from sales. De-coupling occurs when rates, set by the Idaho Public Utilities Commission, are unlinked from projected sales.
When rates are based on projected sales, there's a natural disincentive for company-sponsored energy efficiency programs: When customers use less electricity, Idaho Power gets less money.
The plan, then, uses a de-coupling mechanism to determine rates, while requiring Idaho Power to promote energy efficiency.
During the three-year pilot program, the company would be reimbursed whenever sales are less. Customers would be reimbursed when sales are greater.
Fadness estimates that homes with a monthly average use of 1,000 kilowatts per hour would see no more than $1 increase for each month that sales are less.
Idaho Power may come up with new programs to encourage energy efficiency. Existing programs, however, would qualify.
In a separate docket, Idaho Power is requesting approval of a pilot program that would provide it incentive payments—or penalties—for meeting or failing to meet marketing goals relating to energy efficiency in new home construction.
Under the proposed program, Idaho Power would receive a payment if homes built under the ENERGY STAR® program exceed 7 percent of the total number of residential building permits issued in Idaho Power's service territory in 2007. That number would rise to 9.8 percent of total service area homes in 2008, and 11.7 percent in 2009.
Idaho Power currently provides an incentive payment of $750 to builders for each home built to meet energy efficiency standards set forth by the ENERGY STAR® Homes Northwest program.
Penalties would be levied for any year Idaho Power fails to reach the market share of 4.9 percent program participation it achieved in 2006. Impact on customers' rates would be negligible, according to the utilities commission.
Those wishing to submit comments on either proposal must do so by Jan. 31. Comments are accepted via e-mail by accessing the commission's homepage at www.puc.idaho.gov and clicking on "Comments & Questions."
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