Section 194-37-070. Development of conservation potential and biennial conservation targets.

(1) Ten-year potential. By January 1st of each even-numbered year, each utility shall identify its achievable cost-effective conservation potential for the upcoming ten years.

(2) Biennial target. By January 1st of each even-numbered year, each utility shall establish and make public a biennial conservation target. The utility's biennial target shall be no less than its pro rata share of the ten-year potential identified pursuant to subsection (1) of this section.

(3) Each utility must document the methodologies and inputs used in the development of its ten-year potential and biennial target and must document that its ten-year potential and biennial target are consistent with the requirements of RCW 19.285.040(1).

(4) Each utility must establish its ten-year potential and biennial target by action of the utility's governing board, after public notice and opportunity for public comment.

(5) The methodologies used by the NWPCC in its most recently published regional power plan are summarized in (a) through (o) of this subsection:

(a) Analyze a broad range of energy efficiency measures considered technically feasible;

(b) Perform a life-cycle cost analysis of measures or programs, including the incremental savings and incremental costs of measures and replacement measures where resources or measures have different measure lifetimes;

(c) Set avoided costs equal to a forecast of regional market prices, which represents the cost of the next increment of available and reliable power supply available to the utility for the life of the energy efficiency measures to which it is compared;

(d) Calculate the value of the energy saved based on when it is saved. In performing this calculation, use time differentiated avoided costs to conduct the analysis that determines the financial value of energy saved through conservation;

(e) Conduct a total resource cost analysis that assesses all costs and all benefits of conservation measures regardless of who pays the costs or receives the benefits. The NWPCC identifies conservation measures that pass the total resource cost test as economically achievable;

(f) Identify conservation measures that pass the total resource cost test, by having a benefit/cost ratio of one or greater as economically achievable;

(g) Include the increase or decrease in annual or periodic operations and maintenance costs due to conservation measures;

(h) Include deferred capacity expansion benefits for transmission and distribution systems in its cost-effectiveness analysis;

(i) Include all nonpower benefits that a resource or measure may provide that can be quantified and monetized;

(j) Include an estimate of program administrative costs;

(k) Discount future costs and benefits at a discount rate based on a weighted, after-tax, cost of capital for utilities and their customers for the measure lifetime;

(l) Include estimates of the achievable conservation penetration rates for conservation measures;

(m) Include a ten percent bonus for conservation measures as defined in 16 U.S.C. § 839a of the Pacific Northwest Electric Power Planning and Conservation Act;

(n) Analyze the results of multiple scenarios. This includes testing scenarios that accelerate the rate of conservation acquisition in the earlier years; and

(o) Analyze the costs of estimated future environmental externalities in the multiple scenarios that estimate costs and risks.

[Statutory Authority: RCW 19.285.080. WSR 15-07-002, § 194-37-070, filed 3/6/15, effective 4/6/15; WSR 14-04-015, § 194-37-070, filed 1/24/14, effective 2/24/14. Statutory Authority: RCW 19.285.080(2). WSR 08-07-079, § 194-37-070, filed 3/18/08, effective 4/18/08.]

RCW 19.285.080. WSR 15-07-002, § 194-37-070, filed 3/6/15, effective 4/6/15; WSR 14-04-015, § 194-37-070, filed 1/24/14, effective 2/24/14. Statutory Authority: RCW 19.285.080(2). WSR 08-07-079, § 194-37-070, filed 3/18/08, effective 4/18/08.