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DATE: |
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TO: |
Office of Commission Clerk (Cole) |
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FROM: |
Division of Regulatory Analysis (Lewis, Brown, Garl, Gilbert) Office of the General Counsel (Fleming, Sayler) |
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RE: |
Docket No. 100161-EG – Petition of approval of demand-side management plan of Orlando Utilities Commission. |
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AGENDA: |
08/31/10 – Regular Agenda – Proposed Agency Action – Interested Persons May Participate |
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COMMISSIONERS ASSIGNED: |
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PREHEARING OFFICER: |
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SPECIAL INSTRUCTIONS: |
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FILE NAME AND LOCATION: |
S:\PSC\RAD\WP\100161.RCM.08-19-10.DOC |
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The Commission, as required by the Florida Energy Efficiency and Conservation Act (FEECA), Sections 366.80 through 366.85 and 403.519, Florida Statutes (F.S.), adopted annual goals for seasonal peak demand and annual energy consumption for the FEECA Utilities. These include Florida Power & Light Company (FPL), Progress Energy Florida, Inc. (PEF), Tampa Electric Company (TECO), Gulf Power Company (Gulf), Florida Public Utilities Company (FPUC), JEA, and Orlando Utilities Commission (OUC).
Pursuant to Rule 25-17.008, Florida Administrative Code (F.A.C.), in any conservation goal setting proceeding, the Commission requires each FEECA utility to submit cost-effectiveness information based on, at a minimum, three tests: (1) the Participants Test; (2) the Rate Impact Measure (RIM) Test, and (3) the Total Resource Cost (TRC) Test. The Participants Test measures program cost-effectiveness to the participating customer. The RIM Test measures program cost-effectiveness to the utility’s overall rate payers, taking into consideration the cost of incentives paid to participating customers and lost revenues due to reduced energy sales that may result in the need for a future rate case. The TRC Test measures total net savings on a utility system-wide basis. In past goal setting proceedings, the Commission established conservation goals based on measures that pass both the Participants Test and the RIM Test.
The 2008 Legislative Session resulted in several changes to the FEECA Statute, and the Commission’s goal-setting proceeding was the first implementation of these modifications. By Order No. PSC-09-0855-FOF-EG, the Commission established annual goals for the FEECA Utilities for the period 2010 through 2019. The resulting Commission approved DSM goals for OUC are the average savings achieved from existing DSM programs over the past four years. These goals are divided into residential and commercial/industrial, with each of these further subdivided into three categories: summer peak demand, winter peak demand, and annual energy.
On March 30, 2010, OUC filed a petition requesting approval of its Demand-Side Management (DSM) Plan pursuant to Rule 25-17.0021, F.A.C. The Southern Alliance for Clean Energy (SACE) petitioned for leave to intervene, but the Commission Order has not been issued as of August 20, 2010.
On July 14, 2010, the SACE filed comments on the FEECA Utilities’ DSM Plans. These comments were amended on August 3, 2010, to include comments regarding FPUC. No other intervenors filed comments. On July 28, and August 12, 2010, PEF and Gulf, respectively, filed responses to SACE’s comments. SACE’s comments focused on the IOUs and do not materially affect OUC’s DSM plan.
The Commission has jurisdiction over this matter pursuant to Sections 366.80 through 366.85 and 403.519, F.S.
Discussion of Issues
Issue 1: Does OUC’s proposed 2010 Demand-Side Management (DSM) Plan satisfy the Company’s numeric conservation goals set by the Commission in Order No. PSC-09-0855-FOF-EG?
Recommendation:
Yes. OUC has proposed a DSM Plan that projects peak demand and energy savings that exceed the Commission approved residential and commercial/industrial goals. (Lewis)
Staff Analysis:
By Order No. PSC-09-0855-FOF-EG, the Commission established annual goals for the FEECA Utilities for the period 2010 through 2019. The resulting Commission approved DSM goals for OUC are the average savings achieved from existing DSM programs over the past four years. These goals are divided into residential and commercial/industrial, with each of these further subdivided into three categories: summer peak demand, winter peak demand, and annual energy. Staff believes the DSM Plan submitted by OUC fulfills this requirement, as discussed below.
OUC has proposed a DSM Plan for the ten-year period 2010 to 2019 that projects peak demand and energy savings that exceed the residential and commercial/industrial goals established by the Commission in Order No. PSC-09-0855-FOF-EG. Tables 1 and 2 below depict the Commission-approved goals and OUC’s projection of DSM program savings for each of the ten years.
Table 1 – Comparison of Residential Goals
Table 2 – Comparison of Commercial/Industrial Goals
OUC relied upon historical program participation to project customer enrollment and savings for its programs.
Conclusion
Staff believes OUC’s estimates and projections to be reasonable at this time. The proposed annual energy and seasonal peak demand savings contained in the OUC’s 2010 DSM Plan satisfy the numeric conservation goals set by the Commission in Order No. PSC-09-0855-FOF-EG.
Issue 2:
Do any of the programs in OUC’s proposed DSM Plan have an undue impact on the costs passed on to customers?
Recommendation:
No. Since OUC is continuing existing programs, its customers should see no change in monthly bills due to DSM programs. (Lewis)
Staff Analysis:
OUC’s proposed DSM Plan for the period 2010-2019 contains 13 existing residential programs and 7 existing commercial programs. Though OUC’s Plan contains no programs specifically for renewable energy systems, the Company does currently have six photovoltaic panels installed on schools as part of its renewable energy portfolio. Table 3, below, summarizes OUC’s DSM programs by segment (residential, commercial/industrial, and renewable).
During the goal setting proceeding, OUC proposed DSM goals of zero since no measures were found to be cost-effective pursuant to the RIM test. However, OUC did propose to continue its existing DSM programs. By Order No. PSC-09-0855-FOF-EG, the Commission approved new DSM goals based on OUC continuing its existing programs. Specifically, page 16 of the Order states, “OUC and JEA proposed goals of zero, yet committed to continue their current DSM program offerings. We are setting goals for OUC and JEA based on their current programs so as not to unduly increase rates.”
Staff did request OUC to provide cost-effectiveness results for its existing programs which are shown in the table below. Unlike the IOUs, OUC does not include an estimated cost for greenhouse gas emissions. Therefore, the results shown are for traditional RIM and TRC tests:
Since OUC proposes to continue existing DSM programs, its customers should not see an increase to rates due to additional DSM programs. However, OUC’s existing programs do increase a typical residential bill by approximately $0.46 per month. Individual residential program impacts range from less than $0.01 to $0.14, as shown in the following chart:
Conclusion
OUC’s DSM Plan continues existing programs, as directed by the Commission. Customer rates, therefore, should not be unduly affected due to additional DSM programs.
Issue 3:
Should this docket be closed?
Recommendation:
Yes. If no person whose substantial interests are affected by the proposed agency action files a protest within 21 days of the issuance of the Order, this docket should be closed upon the issuance of a Consummating Order. (Fleming, Sayler)
Staff Analysis:
If no person whose substantial interests are affected by the proposed agency action files a protest within 21 days of the issuance of the Order, this docket should be closed upon the issuance of a Consummating Order.