STATE OF INDIANA INDIANA UTILITY REGULATORY COMMISSION

Transcription

1 STATE OF INDIANA INDIANA UTILITY REGULATORY COMMISSION VERIFIED PETITION OF NORTHERN INDIANA PUBLIC SERVICE COMPANY FOR APPROVAL OF ITS PROPOSED ENERGY EFFICIENCY PLAN FOR ELECTRIC SERVICE (OR ITS ALTERNATIVE PLAN AND ASSOCIATED RATEMAKING AND ACCOUNTING TREATMENT, INCLUDING TIMELY RECOVERY THROUGH NIPSCO S DEMAND SIDE MANAGEMENT ADJUSTMENT MECHANISM OF ASSOCIATED COSTS (INCLUDING PROGRAM COSTS, LOST REVENUES, AND FINANCIAL INCENTIVES, IN ACCORDANCE WITH INDIANA CODE SECTION , AND FOR AUTHORITY TO DEFER PROGRAM COSTS. CAUSE NO. VERIFIED PETITION Northern Indiana Public Service Company ( NIPSCO or Petitioner petitions the Indiana Utility Regulatory Commission ( Commission for approval of its proposed energy efficiency programs for the period January 1, 2019 through December 31, 2021 (the Energy Efficiency Plan or Plan (or its alternative plan for electric service, including proposed programs, program costs and budgets, program portfolios, evaluation, measurement, and verification ( EM&V procedures, and associated ratemaking and accounting treatment for the Plan. The requested ratemaking and accounting treatment

2 includes timely recovery through NIPSCO s Rider 783 Adjustment of Charges for Demand Side Management Adjustment Mechanism and Appendix G Demand Side Management Adjustment Mechanism (DSMA Factor ( DSMA Mechanism of program costs (including direct and indirect program costs and EM&V costs along with recovery of lost revenues and financial incentives, and authority to defer Plan costs until such costs are reflected in Petitioner s retail electric rates. In accordance with 170 IAC and , Petitioner submits the following information in support of this Petition. Petitioner s Corporate and Regulated Status 1. NIPSCO is a public utility corporation organized and existing under the laws of the State of Indiana with its principal office and place of business at 801 East 86th Avenue, Merrillville, Indiana. Petitioner renders electric and gas public utility service in the State of Indiana and owns, operates, manages and controls, among other things, plant and equipment within the State of Indiana used for the generation, transmission, distribution and furnishing of such service to the public. Petitioner is a public utility under Ind. Code and is subject to the jurisdiction of this Commission in the manner and to the extent provided by the Public Service Commission Act, as amended, and other pertinent laws of the State of Indiana. Petitioner is also an electricity supplier under Ind. Code

3 Petitioner s Operations 2. Petitioner is authorized by the Commission to provide electric utility service to the public in all or part of Benton, Carroll, DeKalb, Elkhart, Fulton, Jasper, Kosciusko, LaGrange, Lake, LaPorte, Marshall, Newton, Noble, Porter, Pulaski, Saint Joseph, Starke, Steuben, Warren and White Counties in northern Indiana. Petitioner provides electric utility service to more than 468,000 residential, commercial, industrial, wholesale and other customers. Recent History of NIPSCO s Electric Energy Efficiency Programs 3. On December 30, 2015, the Commission issued an Order in Cause No granting NIPSCO s request for, among other things, (1 approval of an electric energy efficiency program effective for the period January 1, 2016 through December 31, 2018 (the EE Program, (2 authority to recover vendor implementation costs, NIPSCO administrative (including marketing costs, and costs associated with the EM&V of those programs, along with lost revenues associated with its EE Program through the DSMA Mechanism (then Rider 683 and (3 accounting and ratemaking treatment, including the authority to defer and recover the over- and under-recoveries of projected costs associated with the EE Program through its DSMA Mechanism pending reconciliation in subsequent rider periods and approving the deferral of any costs incurred implementing the programs prior to the time -3-

4 the Commission issued its Order in that Cause authorizing NIPSCO to recognize those costs through the ratemaking process. 4. On July 18, 2016, the Commission issued an Order in Cause No approving, among other things, NIPSCO s (1 DSMA Mechanism to become effective October 1, 2016, (2 proposal to reset lost revenues in its DSMA Mechanism, effective upon the implementation of new base rates (October, 2016, and (3 proposal to eliminate lost revenues attributable to all energy efficiency measures installed on or before December 31, On February 22, 2017, the Commission issued an Order in Cause No DSM-11 approving, among other things, NIPSCO s (1 proposal to transition from semi-annual to annual tracker filings, (2 proposal to change the date by which eligible customers must notify NIPSCO of their intent to opt out of or opt in to NIPSCO s electric demand side management programs from November 15 to May 15, and (3 proposed modifications to the DSMA Mechanism to effectuate these changes. Indiana Code In 2015, the Indiana General Assembly passed Ind. Code which, among other things, requires electricity suppliers to petition the Commission, not later than 2017, for approval of a plan that includes: (1 energy -4-

5 efficiency goals; (2 energy efficiency programs to achieve the energy efficiency goals; (3 program budgets and program costs; and (4 EM&V procedures that include independent EM&V. Ind. Code outlines ten factors the Commission must consider when determining the overall reasonableness of an electricity supplier s proposed plan. If the Commission determines that an electricity supplier s plan is reasonable, the Commission shall approve the plan in its entirety, allow the electricity supplier to recover all associated program costs on a timely basis through a periodic rate adjustment mechanism, including reasonable financial incentives and lost revenues, and allocate and assign costs associated with a program to the class or classes of customers that are eligible to participate in the program. 7. Petitioner s request in this Cause is being made in compliance with Ind. Code NIPSCO s Proposed Energy Efficiency Plan 8. As detailed in Petitioner s case-in-chief testimony, the energy efficiency goals of its proposed Plan and its alternative plan are as follows: -5-

6 Gross Energy Efficiency Goals (MWh Total Residential Programs 50,974 50,947 50, ,839 C&I Programs 72,000 80,000 88, ,000 Total Plan 122, , , ,839 Alternative Gross Energy Efficiency Goals (MWh Total Residential Programs 17,050 11,349 11,640 40,039 C&I Programs 24,924 27,055 28,131 80,110 Total Plan 41,974 38,404 39, , As detailed in Petitioner s case-in-chief testimony, Petitioner proposes to implement eleven residential energy efficiency programs and five Commercial & Industrial ( C&I energy efficiency programs to achieve the energy efficiency goals. 10. As detailed in Petitioner s case-in-chief testimony, Petitioner s program budgets and program costs for its proposed Plan and its alternative plan are as follows: Residential C&I Total Vendor Implementation Cost $26,171,396 $26,806,485 $52,977,881 NIPSCO Administration $1,308,570 $1,340,324 $2,648,894 NIPSCO Marketing $654,282 $670,163 $1,324,445 EM&V $1,308,570 $1,340,324 $2,648,894 Total Program Budget $29,442,818 $30,157,296 $59,600,114 Lost Revenues $13,507,609 $24,240,078 $37,747,687 Financial Incentives $1,863,476 $4,523,595 $6,387,071 Total Program Costs $44,813,903 $58,920,969 $103,734,872-6-

7 Residential C&I Total Vendor Implementation Cost $8,575,767 $8,396,935 $16,972,702 NIPSCO Administration $428,791 $419,844 $848,635 NIPSCO Marketing $214,395 $209,924 $424,319 EM&V $428,791 $419,844 $848,635 Total Program Budget $9,647,744 $9,446,547 $19,094,291 Lost Revenues $4,143,042 $8,263,263 $12,406,305 Financial Incentives $589,421 $1,416,985 $2,006,406 Total Program Costs $14,380,207 $19,126,795 $33,507, As detailed in Petitioner s case-in-chief testimony, Petitioner is proposing a comprehensive plan and procedures to evaluate, measure, and verify the impacts from its Energy Efficiency Plan, including the use of an independent evaluator. 12. With this Petition, NIPSCO is filing testimony in support of its Petition, which includes details relating to NIPSCO s proposed Energy Efficiency Plan, such as energy efficiency goals, energy efficiency programs to achieve those goals, program budgets and program costs, EM&V procedures (including independent EM&V, allocation of Plan costs, and other information as required by Ind. Code and 170 IAC et seq. NIPSCO s testimony also details its requested ratemaking and accounting treatment. 13. Consistent with Ind. Code , Petitioner s proposed Plan is consistent with its integrated resource plan. However, in the event that the -7-

8 Commission concludes that the proposed Plan is not consistent with Petitioner s integrated resource plan, Petitioner requests that the Commission approve its alternative plan. Relief Sought by Petitioner 14. In this proceeding, Petitioner requests Commission approval of its proposed Energy Efficiency Plan (or the alternative plan in its entirety, including: (1 energy efficiency goals; (2 energy efficiency programs to achieve the energy efficiency goals; (3 program budgets and program costs; (4 EM&V procedures including an independent EM&V evaluator; (5 allocation and recovery of all associated program costs (including vendor implementation and NIPSCO administrative costs along with costs associated with the EM&V of those programs on a timely basis through a periodic rate adjustment mechanism, including recovery of financial incentives related to the programs and lost revenues resulting from the programs; and (6 authority to defer and recover any over- and under-recoveries of projected costs associated with the Energy Efficiency Plan. 15. Petitioner also requests Commission approval to begin implementation of its Energy Efficiency Plan as of January 1, Additionally, consistent with current practice, Petitioner requests -8-

9 Commission approval to continue to utilize its existing NIPSCO Oversight Board ( OSB to assist in the administration of its proposed Plan. Specifically, once the Plan has been approved by the Commission, NIPSCO proposes that the NIPSCO OSB continue to have the flexibility to shift costs within a program budget as needed, shift funds among programs so long as the overall Plan budget is not exceeded, and design and implement new programs as long as they pass the Total Resource Cost test and the overall Plan budget is not exceeded. In addition, NIPSCO proposes that the OSB have the authority to approve the expenditure of unspent funds from previous program years and to increase any individual program funding by up to 5% of the total program budget, even if this exceeds the overall Plan budget as approved by the Commission. 17. Consistent with current practice, NIPSCO requests to continue the same EM&V program for its Energy Efficiency Plan. Specifically NIPSCO s OSB will select a single vendor to do the EM&V for both the gas and electric programs. This provides administrative efficiency for the evaluation of NIPSCO s programs. Petitioner s Proposed Reporting Requirements 18. To provide the Commission with the ability to monitor the progress of NIPSCO s Energy Efficiency Plan and consistent with the

10 Order, NIPSCO proposes to file its annual EM&V results within 30 days of approval of the final EM&V report by its OSB, but no later than July 1. Consistent with the Commission s June 29, 2016 Order in Cause No DSM- 10, NIPSCO proposes to continue filing scorecards quarterly with the fourth quarter scorecard to include information for the full year as well as information related to the EM&V of the programs. Procedural Matters 19. The books and records of Petitioner supporting the DSMA Mechanism are kept in accordance with the Uniform System of Accounts for Electric Utilities, as prescribed by this Commission, and generally accepted accounting principles ( GAAP, and are available for inspection and review by the Indiana Office of Utility Consumer Counselor ( OUCC and this Commission. 20. NIPSCO has notified the other members of its OSB of its intent to file this Petition. 21. At the same time NIPSCO files this Petition, NIPSCO will provide a copy of this Petition and its proposed Plan to the Indiana Office of Utility Consumer Counselor. 22. At the same time NIPSCO files this Petition, NIPSCO will post an -10-

11 electronic copy of this Petition and its proposed Plan on its internet web site (redacted to exclude any confidential or proprietary information. 23. In accordance with 170 IAC (b of the Commission s Rules of Practice and Procedure, NIPSCO requests that the Commission schedule a prehearing conference and preliminary hearing for the purpose of fixing a procedural schedule in this proceeding and considering other procedural matters as soon as possible. NIPSCO will work with its stakeholders to seek agreement regarding scheduling matters in this proceeding in lieu of a prehearing conference. 24. NIPSCO requests that an evidentiary hearing on this matter be set and noticed as required by law. So that the Energy Efficiency Plan may be timely implemented commencing January 1, 2019, NIPSCO requests a final Commission order approving the relief sought herein on or before December 31, Absent approval, Petitioner s current energy efficiency program offerings authorized for the period will cease on December 31, Applicable Law 25. Petitioner considers the provisions of the Public Service Commission Act, as amended, including Ind. Code and Ind. Code -11-

12 , (a, and to be applicable to the subject matter of this Petition and believes that such traditional statutes provide the Commission authority to approve the requested relief. Petitioner also considers the provisions of 170 IAC et seq. to be applicable to the subject matter of this Petition. Petitioner s Counsel 26. The names and addresses of all persons authorized to accept service of papers in this proceeding are: Counsel of Record: Kay Pashos (No Mark Alson (No Ice Miller LLP One American Square, Suite 2900 Indianapolis, Indiana Pashos Phone: ( Alson Phone: ( Fax: ( kay.pashos@icemiller.com mark.alson@icemiller.com With a copy to: Alison M. Becker Northern Indiana Public Service Company 150 West Market Street, Suite 600 Indianapolis, Indiana Phone: ( Fax: ( abecker@nisource.com WHEREFORE, Northern Indiana Public Service Company respectfully requests that the Commission promptly publish notice, make such other investigation and hold such hearings as are necessary or advisable in this Cause and thereafter, make and enter an order in this Cause: -12-

13 (a Approving Petitioner s proposed Energy Efficiency Plan (or the alternative plan in its entirety to be implemented as of January 1, 2019; (b Approving Petitioner s proposed energy efficiency programs, program costs, and program budgets, including recovery of direct and indirect program costs and EM&V costs, along with approval of the proposed budget and program flexibility described above; (c Approving Petitioner s proposed allocation of its Energy Efficiency Plan costs to customer classes; (d Approving Petitioner s proposed recovery of lost revenues that will result from implementation of the Energy Efficiency Plan; (e Approving Petitioner s proposed financial incentives associated with the Energy Efficiency Plan; (f Approving Petitioner s proposal to defer, for subsequent recovery, costs associated with the Energy Efficiency Plan, until such costs are reflected in Petitioner s retail electric rates; (g Approving all accounting and ratemaking treatment requested herein, including the authority to defer and recover the over- and underrecoveries of projected program costs and lost revenues through the DSMA -13-

14 Mechanism pending reconciliation in subsequent rider periods and approving the deferral of any costs and lost revenues incurred implementing the Energy Efficiency Plan prior to the time the Commission issues an Order in this proceeding authorizing NIPSCO to recognize these costs through the ratemaking process; (h Approving NIPSCO s request to utilize its existing NIPSCO Oversight Board to administer the Energy Efficiency Plan; (i Approving NIPSCO s request to continue the same EM&V program for its Energy Efficiency Plan; (j Approving NIPSCO s proposed reporting requirements; and (k Granting to NIPSCO such additional or further relief as may be deemed necessary or appropriate. -14-

15 Dated this 22na day of November, NORTHERN INDIANA PUBLIC SERVICE COMP ANY Timothy R. Caister, Vice President of Regulatory Policy Verification I affirm under penalties for perjury that the foregoing representations are true to the best of my knowledge, information, and belief. Dated: November 22, 2017 Timothy R. Caister Vice President, Regulatory Policy -15-

16 CERTIFICATE OF SERVICE The undersigned hereby certifies that the foregoing was served this 22 nd day of November, 2017 via transmission upon Jeffrey M. Reed, Indiana Office of Utility Consumer Counselor, 115 W. Washington Street, Suite 1500 South, Indianapolis, Indiana A courtesy copy has also been provided via transmission upon the following: Joseph P. Rompala Lewis & Kappes, P.C. One American Square, Suite 2500 Indianapolis, Indiana jrompala@lewis-kappes.com jterry@lewis-kappes.com Jennifer Washburn Citizens Action Coalition 603 E. Washington Street, Suite 502 Indianapolis, Indiana jwashburn@citact.org Kay Pashos Kay Pashos (No Mark Alson (No Ice Miller LLP One American Square, Suite 2900 Indianapolis, Indiana Pashos Phone: ( Alson Phone: ( Fax: ( kay.pashos@icemiller.com mark.alson@icemiller.com Attorneys for Petitioner Northern Indiana Public Service Company -16-