Idaho's investor-owned utilities administer energy efficiency and other demand-side management (DSM) programs with oversight from the Idaho Public Utilities Commission (PUC). Idaho has not restructured its electric utility industry. There is no legislation requiring funding for energy efficiency programs.
In recent years, the PUC has placed a strong emphasis on utility energy efficiency and DSM. In 2001, after an energy crisis in the western United States, the PUC ordered Idaho Power to file a comprehensive DSM plan and to implement programs. In 2002, the PUC created an energy efficiency rider to fund these programs. In 2006, the PUC required Pacificorp (via operating companies in Idaho, Utah Power and Light and Rocky Mountain Power) to file and implement a comprehensive DSM plan. Idaho electric utilities saved 185,684 MWh in 2009, equal to 0.82% of sales. Reported budgets for energy efficiency programs for 2011, and electricity savings for 2010, are in the State Spending and Savings Tables.
Idaho's energy efficiency programs are supported and supplemented by regional organizations, including the Bonneville Power Administration, the Northwest Energy Efficiency Alliance and the Northwest Power and Conservation Council.
Idaho is currently pilot-testing decoupling. The state is currently revising its incentive program for utilities. In recent years, Idaho has experimented with methods of providing incentives to utilities. The state does not have an energy efficiency resource standard (EERS). State energy plans consider energy efficiency to be a resource for utilities. The state uses an integrated resource planning process.
Idaho utilities reported efficiency program savings of 185,684 MWh in 2009, equal to 0.82% of sales. Reported budgets for energy efficiency programs for 2011, and electricity savings for 2010, are in the State Spending and Savings Tables.
Idaho’s electric efficiency utility programs are not required by legislation. Idaho's investor-owned utilities administer and implement energy efficiency programs and are regulated by the Idaho Public Utilities Commission (PUC). Utilities recover the costs of offering programs via adjusting their rates and adding a tariff rider to customer bills. The PUC requires utilities to file and implement demand-side management (DSM) plans. Since an energy crisis affected the western United States in 2001, the PUC has taken an increasing interest in DSM programs.
In 2001, the PUC ordered Idaho Power to file a comprehensive DSM plan and implement programs. In 2006, the PUC required Pacificorp (Utah Power and Light and Rocky Mountain Power) to file and implement a comprehensive DSM plan. The utility filed a new plan in 2009.
Rocky Mountain Power currently offers energy efficiency programs for residential, commercial and industrial customers. Avista Utilities offers natural gas energy efficiency programs for residential, low-income, commercial and industrial customers in Idaho. Intermountain Gas is considering implementing programs, but has not done so yet.
In 1989, Regulatory Order 22299 required utilities to consider cost-effective energy efficiency measures for natural gas. Avista Utilities administers all of the programs except for the low-income programs. The low-income programs are administered by the Idaho Department of Health and Welfare.
Idaho Power offers its largest customers an option to self-direct the 4.75% energy efficiency rider that appears on all customers’ bills. Customers have three years to complete projects and have 100% of funds available to fund up to 100% of project costs. Self-direct projects are subject to the same criteria as projects in other efficiency programs. More information on large customer self-direct programs can be found in the ACEEE report, Follow the Leaders: Improving Large Customer Self-Direct Programs.
Both electric and natural gas energy efficiency programs in Idaho are funded by utilities. The utilities recover the costs of operating these programs by adjusting their rates and adding a tariff rider onto customer bills. The Idaho Public Utilities Commission recently increased this rider from 2.5 to 4.75 percent.
The Consortium for Energy Efficiency reports 2010 electric efficiency budgets totaling $36.1 million and natural gas budgets of $2.1 million. Reported budgets for energy efficiency programs for 2011 are in the State Spending and Savings Tables.
Idaho Power's decoupling mechanism, called a Fixed-Cost Adjustment (FCA), is designed to provide symmetry (a surcharge or credit) when fixed cost recovery per customer varies above or below a commission-established base. The FCA was first implemented on a pilot basis for a three-year period beginning January 1, 2007 and running through December 31, 2009. The pilot was extended for two years after that. The FCA applies to all residential and small commercial customers. The FCA also incorporates a 3% cap on annual increases and carries over unrecovered deferred costs to subsequent years. Rate increases and credits resulting from the FCA have been distributed to residential and small general service customer classes equally on an energy use basis. See ID PUC Order No. 30267. The two-year extension was approved for Idaho Power Co in ID PUC Order No. 31063.
Idaho Power (IPC) was approved for a three-year pilot incentive program beginning in January 2007 and ending in December 2009. During the pilot, IPC received an incentive if the market share of homes constructed under the ENERGY STAR Homes Northwest program exceeded a target percentage of new homes constructed. IPC earned an incentive if the program exceeded the market share goal (7% in 2007, 9.8% in 2008, and 11.7% in 2009). Incentives were capped at 10% of program net benefits. Penalties were levied if IPC did not meet a minimum market share percentage. On March 11, 2009, IPC requested that the pilot be discontinued retroactively as of January 1, 2009 due to then-current economic conditions. IPC, however, intends to explore the development of an incentive mechanism that can be applied to the company’s entire portfolio of DSM/energy efficiency programs.
Idaho's investor-owned utilities are required to prepare and file integrated resource plans that include comprehensive demand-side management plans. The Public Utilities Commission (PUC) prepares a statewide energy plan; in the most recent plan (2007), the PUC recommended that when acquiring resources, Idaho and Idaho utilities should give priority to conservation, energy efficiency and demand response.
The evaluation of ratepayer-funded energy efficiency programs in Idaho relies on regulatory orders. Evaluations are administered by both the utilities and the Idaho Public Utilities Commission. No rules or requirements are specified, but there is a January 2009 Memorandum of Understanding (MOU) among Commission Staff and the three electric Idaho investor-owned utilities. Evaluations for each of the utilities are conducted. Idaho uses four of the five classic benefit-cost tests identified in theCalifornia Standard Practice Manual. These are the Total Resource Cost (TRC), Utility/Programs Administrator (UCT), Participant (PCT), and Ratepayer Impact Measure (RIM). Idaho does not have a primary cost-effectiveness test that it relies upon. These benefit-cost tests are required for overall portfolio, total program, customer project, and individual measure level screening, with exceptions for low-income programs, pilots, and new technologies. Measure level screening has strictly applied tests.