NH OCA, time to get serious about energy efficiency and NWAs
"This year, the Office of the Consumer Advocate decided to get serious about what is known in the trade as non-wires alternatives – NWAs.
The idea is that energy efficiency measures can be targeted to specific places in a utility’s service territory so as to allow the utility to delay, or avoid altogether, making expensive investments in transmission and distribution infrastructure. That infrastructure is usually referred to colloquially as “poles and wires” but it also includes transformers, capacitors, sensors and other costly items.
Right now, the EERS is a great business proposition for the utilities. There are rate adjustment mechanisms in place to make them whole for the fixed costs they continue to incur as customers consume less. There is a performance incentive mechanism that rewards shareholders for doing a good job with the energy efficiency programs.
But they cried foul when we so much as asked them about NWAs, as part of the formal discovery process in this fall’s energy efficiency docket. Discovery – information gathering – is a routine part PUC proceedings, and we are entitled to ask discovery questions of utilities as long as the questions are calculated to lead us to admissible evidence.
The utilities – Eversource in particular — objected to our questions about NWAs and even went so far as to claim that the OCA is forbidden by contract from pursuing this issue. They argue that by signing two previous settlements, agreeing to a three-year plan with “abbreviated” update dockets this fall and next – we bargained away our right to raise this issue now or, presumably, a year from now as well.
Why do the utilities hate this NWA idea so much? Because they cannot get beyond their 20thCentury business model, in which they buy toys (poles, wires, transformers, capacitors, etc.), put them into rate base, earn a comfortable return on these investments, and get the investments themselves back from ratepayers over time via depreciation charges that are also embedded in rates.
Travis Kavulla, an outspoken utility commissioner from Montana, put it succinctly the other day on Twitter. “Rate base is a hell of a drug,” he tweeted."