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State Energy Efficiency Policy Database

Utah

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Summary

Utah's utilities administer and implement a growing portfolio of energy efficiency programs as required by the Utah Public Service Commission as part of integrated resource plans, in place since 1992, that are filed biennially by the utilities and include demand-side resources and associated programs. Utility energy efficiency program investments and energy savings have grown significantly in recent years and are now above the national average.  The state’s largest electric utility, Rocky Mountain Power (RMP), serves around 80 percent of Utah’s population. These programs are funded via a 3% tariff rider on customer bills.

Utah recently passed legislation (House Joint Resolution 9) that calls for Utah's electric utilities to reduce the state's energy consumption by 1% annually. The bill also calls for natural gas utilities to save 0.5% annually.  It encourages the use of “all available cost-effective energy efficiency.”

In September 2009, the PSC approved RMP’s request to increase its utility bill surcharge to pay for demand-side management (DSM) programs to 4.6%. Utah’s main natural gas utility, Questar Gas, began implementing efficiency programs in 2007 and is currently testing a pilot decoupling program. Utah's funding and commitment to energy efficiency programs has increased significantly over the past several years. For electric efficiency programs, utilities saved approximately 176,505 net MWh. Electric program budgets totaled $49.4 million for 2010, according to the Consortium for Energy Efficiency, and natural gas budgets were $36.1 million.

The most recent budgets for energy efficiency programs and electricity and natural gas savings can be found in the State Spending and Savings Tables on the left.

For further reading, in October 2007, as part of the State Clean Energy Resource Project, ACEEE completed the reportUtah Energy Efficiency Strategy Policy Options.

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November 8, 2013


Customer Energy Efficiency Programs

Utah's funding and commitment to utility energy efficiency programs has increased significantly over the past several years. The state's largest investor-owned utility, Rocky Mountain Power (RMP) (PacifiCorp), administers and provides a comprehensive set of energy efficiency programs as part of integrated resource planning. The Utah Public Service Commission (UPSC) reviews and approves these plans and associated program plans and budgets. Electric efficiency programs are funded through a 3% tariff rider on customer bills, as allowed under Utah Code Section 54-7-12.8(2), which states that the commission may approve a tariff under which an electrical corporation includes a line item charge on its customer bills to recover the costs incurred by the electrical corporation for demand side management.

Questar Gas, the only natural gas utility regulated by the UPSC, also administers energy efficiency programs.  In 2006, the UPSC approved the Conservation Enabling Tariff (CET) allowing Questar to collect a fixed revenue-per-customer on a monthly basis in exchange for promoting customer energy efficiency programs; demand-side management (DSM) programs; and a low-income assistance program.  Questar provides a wide range of energy efficiency programs for residential and business customers.

The most recent budgets for energy efficiency programs and electricity and natural gas savings can be found in the State Spending and Savings Tables on the left.

Rocky Mountain Power's self-direct program is a project-based rate credit program that offers up to an 80% credit of eligible project costs back to customers as a rate credit against the 3.7% cost-recovery mechanism (CRM) charge all customers pay.  Customers earn a credit up to 100% of their CRM charge, but do pay a flat $500/project administrative fee for each self-directed project.  Customers can choose to engage in self-direct and more traditional CRM programs simultaneously, provided the different programs are used to deploy different projects.  More information on large customer self-direct programs can be found in the ACEEE report, Follow the Leaders: Improving Large Customer Self-Direct Programs.

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November 8, 2013


Energy Efficiency Resource Standards

In 2008, Utah adopted a renewable portfolio standard (RPS) of 20% by 2025 that allows energy savings from DSM measures to qualify towards the standard without any cap. However, the policy remains pending as this is a legislative goal that has yet to be codified by the Utah PSC. 


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August 11, 2013


Alternative Business Models

No decoupling mechanism is in place for electric utilities.

On October 5, 2006, Questar Gas was approved to implement a Conservation Enabling Tariff (CET) and Demand-Side Management (DSM) Pilot Program. The CET allows Distribution Non-Gas (“DNG”) revenues received by Questar to be based on the number of customers rather than customers’ gas usage. This is considered to be a form of decoupling. On June 24, 2009, the Pilot Program was extended to operate until December 31, 2010 (PSC Docket No. 05-057-T01, October 2006).

HJR 9 encourages the Utah Public Service Commission to remove financial disincentives to utility efficiency programs.


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August 9, 2013


Reward Structures for Successful Energy Efficiency Programs

HJR 9 expresses support for regulatory mechanisms to help remove utility disincentives and create incentives to increase efficiency and conservation so long as these mechanisms are found to be in the public interest.


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August 9, 2013


Energy Efficiency as a Resource

Utah's integrated resource planning requirements were established in 1992.  Utilities file biennial integrated resource plans which include demand-side resources and associated programs. From the IRP guidelines, “The [IRP] process should result in the selection of the optimal set of resources given the expected combination of costs, risk and uncertainty.” Standard and Guidelines, 1. Definition. Also, PacifiCorp’s IRPs must include “An evaluation of all present and future resources, including future market opportunities (both demand-side and supply-side) on a consistent and comparable basis. Standards and Guidelines, 4.b.

In March 2009, the Utah Legislature passed HJR 9, a Joint Resolution on Cost-effective Energy Efficiency and Utility Demand-Side Management. This resolution recognizes the multifaceted benefits of utility energy efficiency and sets non-binding energy savings goals of at least 1 percent per year for Utah’s electric corporations and at least 0.5 percent per year for Utah’s natural gas utility corporations.


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August 11, 2013


Evaluation, Measurement & Verification
  • Cost-effectiveness test(s) used: UCT, TRC, PCT, RIM
  • Uses a deemed savings database: no

The evaluation of ratepayer-funded energy efficiency programs in Utah relies on regulatory orders (Docket No. 09-035-27).Evaluations are mainly administered by the utilities. Utah has formal requirements for evaluation articulated in Docket No. 09-035-27, Docket No. 09-035-74 and Guideline Revisions Report, Exhibits A, B, C and D. Evaluations for each of the utilities are conducted. Utah uses four of the five classic benefit-cost tests identified in the California Standard Practice Manual. These are the Total Resource Cost (TRC), Utility/Program Administrator (UCT), Participant (PCT), and Ratepayer Impact Measure (RIM). Utah specifies the UCT to be its primary test for decision making. The benefit-cost tests are required for overall portfolio, total program, and customer project level screening. The rules for benefit-cost tests are stated in Docket number 09-035-27.


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August 21, 2013