Rate Impacts of Various DSM Program Designs

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Rate Impacts of Various DSMProgram Designs

• Dave Lamont
• EEU Budget Negotiations
• April 10, 2006

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Model Design

• Based on 2004 revenues and sales
• Losses attributed to Sales and DSM impacts are
  adjusted to VELCO
• Base load forecast assumes no new DSM after 2008
• Base load growth (no DSM) assumed to be 1.5

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Model Design

• 2004 Base revenues separated into VY, HQ, and IPP
  plus everything else
• Revenues are adjusted going forward for impacts
  of contract expirations as well as incremental
  market purchases and sales. Everything else
  escalated at inflation (2.5)
• Model used ICF avoided cost study, including ICAP
  cost projections

4
Model Design

• RR includes DSM budgets for 06 08
• Revenue requirements (RR) adjusted for TD
  expenditures above base peak load

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Scenarios

• Model used DSM scenarios as presented by EVT at
  the 12/3/2005 workshop
• A second set was developed which assumed 2008
  savings levels continued through 2025 with costs
  escalated at inflation (2.5)
• Savings estimates incorporated EVT decay function
• DSM costs expensed in each year

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Results

• Rates increased
• Revenue requirements (including DSM costs)
  decreased

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Base Case
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