Florida Public Service Commission native order document 08076-2024

FILED 7/30/2024
DOCUMENT NO. 08076-2024
FPSC - COMMISSION CLERK
BEFORE THE FLORIDA PUBLIC SERVICE COMMISSION
In re: Commission review of numeric
conservation goals (Peoples Gas System, Inc.)
DOCKET NO. 20240018-EG
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ORDER NO. PSC-2024-0280-P AA-EG
ISSUED: July 30, 2024
The following Commissioners participated in the disposition of this matter:
MIKE LA ROSA, Chairman
ARTGRAHAM
GARY F. CLARK
ANDREW GILES FAY
GABRIELLA P ASSIDOMO
NOTICE OF PROPOSED AGENCY ACTION
ORDER APPROVING NUMERIC CONSERVATION GOALS
BY THE COMMISSION:
NOTICE is hereby given by the Florida Public Service Commission (Commission) that
the action discussed herein is preliminary in nature and will become final unless a person whose
interests are substantially affected files a petition for a formal proceeding, pursuant to Rule 25-
22.029, Florida Administrative Code (F.A.C.).
Background
Sections 	366.80 	through 	366.83, and 403.519, 	Florida 	Statutes 	(F.S.), 	are 	known
collectively as the Florida Energy Efficiency and Conservation Act (FEECA). Originally enacted
in 	1980, 	FEECA 	emphasizes 	the 	utilization 	of efficient 	and 	cost-effective 	demand-side
renewable energy and conservation systems. Pursuant to Section 366.82, F .S ., we must review
the conservation goals of each utility subject to FEECA at least every five years. Collectively,
those utilities subject to FEECA are referred to as the FEECA Utilities. These include Peoples
Gas System, Inc. (PGS or Company), the only natural gas utility subject to these requirements,
all four investor-owned electric utilities, and two municipal electric utilities. 1
Rule 25-17.009, F.A.C., establishes a methodology for assessing the cost effectiveness of
demand-side management (DSM) programs for natural gas utilities. Since 1981, PGS has offered
a variety of conservation programs that we have reviewed pursuant to Rule 25-17.015, F .A. C.,
1 Section 366.82, F.S., provides that a natural ga s utility is subject to FEECA requirements if a utility 's annual retail
sa les volume is equal to or greater than I 00 million therms. The FEECA electric Utilities include Florida Power &
Light Company; Duke Energy Florida, LLC ; Tampa Electric Company; Florida Public Utilities Company; JEA; and
Orlando Utilities Commission.

ORDER NO. PSC-2024-0280-PAA-EG
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the 	Energy 	Conservation 	Cost 	Recovery 	(ECCR) 	clause. 	Conservation 	goals 	were 	last
established 	for 	PGS 	by 	Order 	No. 	PSC-2019-0361-PAA-GU, 	issued 	August 	28, 	2019. 2
Therefore, new goals must be established by January 2025.
On March 8, 2024, PGS filed a petition for approval of its natural gas DSM goals for the
period 2025-2034. We have jurisdiction over this matter pursuant to Sections 366.80 through
366.83, and 403.519, F.S.
Decision
We are required to adopt appropriate conservation goals to promote energy efficiency and
the development of DSM programs. Section 366.82(2), F.S. In developing a utility’s goals, we
are required to evaluate the full technical potential of all available demand-side and supply-side
conservation and efficiency measures applicable to a utility’s system. Section 366.82(3), F.S.
Additionally, 	in 	establishing 	a 	utility’s 	goals, we 	are 	required 	to 	consider 	certain 	cost-
effectiveness criteria. Section 366.82(3)(a)-(d), F.S.
Developing Goals – PGS’ Technical Potential
In order to evaluate whether PGS’ petition adequately assessed the full technical potential
of all available demand-side and supply-side conservation and efficiency measures applicable to
the Company’s system, we reviewed PGS’ analysis of the maximum system-wide therm savings
theoretically possible from implementation of DSM measures, regardless of cost and other
barriers that may prevent installation or adoption. We evaluated the development of this therm
savings analysis, termed the Technical Potential, by reviewing each of its four parts: (1) the
identification of the DSM measures to be evaluated; (2) the calculation of the theoretical per-site
therm savings for each DSM measure; (3) the calculation of the system-wide therm savings for
each DSM measure; and (4) the determination of total system-wide therm savings potential in
PGS’ service area.
1. 	Identification of DSM Measures
PGS identified the DSM measures for inclusion in the Technical Potential by first
compiling a list of technologies known by the Company to be commercially available in Florida
and that, when applied in a residential, commercial, or industrial setting, yield reductions in the
use of natural gas. The Company started by using its technical potential study developed in its
prior goalsetting proceeding, then compared this list against other utility, state, and federal
technical potential studies and technical reference manuals to identify additional measures,
including demand-side renewable energy systems. Those measures found to be missing were
filtered by commercial availability in Florida before being added to the list of DSM measures
evaluated in PGS’ Technical Potential. Ultimately, 33 residential, 31 commercial, and 25
industrial measures addressing water heating, cooking, HVAC, laundry, and industrial process
2 Order No. PSC-2019-0361-PAA-GU, issued August 28, 2019, in Docket No. 20180186-EG, In re: Petition for
approval of demand side management goals and residential customer assisted and commercial walk-through energy
audit programs, by Peoples Gas System.

ORDER NO. PSC-2024-0280-PAA-EG
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cases were evaluated. Compared to the previous goalsetting proceeding, PGS added two
residential and commercial measures, and three industrial measures.3 In light of our review, we
find that the methodology used to compile the list of DSM measures evaluated in PGS’
Technical Potential is adequate because we believe it reasonably contemplates all efficiency and
conservation technologies commercially available in Florida.
2. 	Theoretical Per-Site Therm Savings for Each DSM Measure
We also reviewed PGS’ calculation of theoretical per-site therm savings for each
identified DSM measure. PGS counted only the savings from new, replaced, or retrofitted
measures that surpassed those savings based on minimum appliance energy efficiencies in the
Florida Building Code or the associated Federal Appliance Efficiency Standards, whichever is
greater. This is similar to the methodology we accept from electric FEECA utilities in
developing their goals. PGS derived the energy consumption parameters used in its savings
calculations from a combination of state and national industry sources, current building code and
appliance standards, and a review of historical DSM program activity. We find that the
methodology used by PGS in the updated calculations adequately assesses the theoretical per-site
therm savings of the DSM measures evaluated because it reasonably estimates consumption and
measure-related savings while controlling for savings from other applicable efficiency standards.
3. 	System-wide Therm Savings for DSM Measures
PGS calculated system-wide theoretical therm savings on a per-measure basis by
applying the per-site therm savings to modified counts of its sector-specific customer populations
to determine the applicable populations. PGS then modified the baseline applicable populations
for each DSM measure to account for existing measure prevalence and incompatibility with a
customer’s premises, as indicated by the Company’s recent residential equipment market survey
and a review of the characteristics of its commercial and industrial customer populations. For the
industrial sector, PGS analyzed individual customer annual usage to determine that sector’s
technical potential, instead of equipment ratings used in the prior technical potential study. We
find that the methodology used by PGS to calculate system-wide theoretical therm savings on a
per-measure basis is adequate because it reasonably accounts for both the applicable population
and observed customer behavior for each DSM measure in PGS’ service area.
4. 	Technical Potential Results
Since we last established goals for PGS, the Company’s total technical potential
decreased by approximately 33.4 percent, from 456.5 million therms to 304.0 million therms.
This is primarily due to a decrease in the industrial technical potential related to the change of
methodology discussed above. In contrast, commercial technical potentials increased by 11.7
percent, from 150.0 million therms to 167.6 million therms, and residential technical potential
increased by 89.5 percent, from 60.1 million therms to 114.0 million therms. PGS attributes the
3 New measures added are Energy Star Tankless Water Heater and Energy Star Furnaces for each customer class
(residential, commercial, and industrial) and Tank Water Heaters for industrial customers.

ORDER NO. PSC-2024-0280-PAA-EG
DOCKET NO. 20240018-EG
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increase in residential goals to an increase in the residential population by 33 percent since the
last goals proceeding, improved therm savings, or applicability for furnace and pool measures.
Using the updated therm savings calculations, PGS developed the Technical Potential shown in
Table 1, below.
Table 1
2025 Technical Potential
Sector 	Therm Savings
Residential 	113,956,673
Commercial 	167,632,935
Industrial 	22,430,474
Total 	304,020,082
Source: PSC Document No. 01357-2024
In light of the foregoing, we find that PGS has analyzed the maximum system-wide
therm savings theoretically possible from implementation of DSM measures available in Florida.
As such, we hereby find that the updated Technical Potential shown in Table 1 above serves as
an acceptable basis for the Company’s annual therm savings goals.
Establishing Goals –Section 366.82(3), F.S., Considerations
Section 366.82(3), F.S., states that, in establishing these goals, we shall take into
consideration: (1) the costs and benefits to customers participating in a program and to the
general body of ratepayers; (2) the need for incentives to promote both customer-owned and
utility-owned energy efficiency and demand-side renewable energy systems; and (3) the costs
imposed by state and federal regulations on the emission of greenhouse gases.
PGS proposed annual residential and commercial conservation goals for the years 2025-
2034 that focus on achieving overall therm usage reductions at residential and small-commercial
end-use sites, incorporating the technical potential measures into its residential and commercial
programs.4 Because the Company’s current and potential DSM programs serve as the basis for
its proposed annual conservation goals, we reviewed these programs, taking into consideration
those factors enumerated in Section 366.82(3), F.S.
1. 	Benefits and Costs to Participants and the General Body of Ratepayers
Section 366.82(3)(a), F.S., requires us to take into consideration the costs and benefits to
customers participating in a program. Section 366.82(3)(b), F.S., requires us to take into
consideration the costs and benefits to the general body of ratepayers as a whole, including utility
incentives 	and 	participant 	contributions. 	In 	Rule 	25-17.009, 	F.A.C., 	we 	prescribe 	cost-
effectiveness tests for gas utilities seeking cost recovery for an existing, new, or modified DSM
4 We note that PGS did not propose commercial goals, nor did it incorporate any DSM measures into its DSM
portfolio for large commercial or industrial customers. This is because these customers are entirely either natural gas
fired co-generators or interruptible customers, two rate classes that are excluded from cost recovery through the
ECCR clause by Commission order. See Order No. 23576, issued October 3, 1990, in Docket No. 19900002-EG, In
re: Conservation Cost Recovery Clause.

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program. The Participants Test measures the impact of a program on the participating customers,
while the Gas Rate Impact Measure (G-RIM) Test considers the effect on the general body of
ratepayers as an indirect measure of the program impact on customer rates that addresses utility
incentives and participation. A score of 1.0 or greater indicates a program is cost-effective for a
particular test. Based on the Company’s analyses, all of PGS’ programs upon which its proposed
goals are based are cost-effective, passing both the Participants Test and G-RIM Test with scores
above 1.0. Therefore, we find that Sections 366.82(3)(a) and (b), F.S., are adequately addressed
by the Company’s proposed DSM goals.
2. 	Need for Incentives
Section 366.82(3)(c), F.S., requires us to take into consideration the need for incentives to
promote both customer-owned and utility-owned energy efficiency and demand-side renewable
energy systems. As stated previously, the proposed DSM goals are based upon PGS’ current
Commission-approved DSM programs. The current DSM programs were approved in 2019,
when this Commission found that the cash incentive allowances included in PGS’ programs were
cost-effective and did not impose an undue rate impact on PGS customers’ monthly bills. We
found above that PGS’ programs and the proposed incentives continue to be cost-effective with
no undue rate impact to PGS customers. The design of the incentives for both residential and
small commercial programs include consideration of free ridership and, thus, we find reasonably
balance incentive effectiveness with the ability of these programs to contribute to the defrayal of
the costs associated with the installation of natural gas supply lines, internal piping, venting and
equipment. Therefore, we find that Section 366.82(3)(c), F.S., is adequately addressed by the
Company’s proposed DSM goals.
3. 	Greenhouse Gas Emissions
Section 366.82(3)(d), F.S., requires us to take into consideration the costs imposed by
state and federal regulations on the emission of greenhouse gases. Currently, there are no costs
imposed on PGS by state and federal regulations on the emissions of greenhouse gases. If any
regulations on the emission of greenhouse gases are established that impact PGS, we may review
and, if appropriate, modify PGS’ goals to account for any associated costs.
Adopting Appropriate Goals – PGS’ Achievable Annual Therm Savings
Section 366.82(2), F.S., requires us to adopt appropriate conservation goals to promote
energy efficiency and the development of DSM programs. We evaluated PGS’ proposed
achievable therm savings goals by reviewing each proposed DSM program’s projection of
achievable 	annual 	therm 	savings 	over 	the 	2025-2034 	period. 	The 	Company 	derived 	its
achievable annual therm savings for the period by calculating projected yearly DSM measure
participation together with the updated per-site therm savings achievable for each DSM measure
discussed above. Overall, PGS proposed a cumulative 10-year therm goal of 8.0 million therms,
29.9 percent greater than its prior goal of 6.2 million therms. These savings can be seen in Table
2 below, alongside a cumulative count of projected savings, and are the Company’s proposed
annual conservation goals for the period 2025-2034.

ORDER NO. PSC-2024-0280-PAA-EG
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Because PGS’ proposed achievable therm savings goals reasonably estimate yearly DSM
participation and accurately calculate the resulting system-wide therm savings, we hereby find
that the annual therm savings shown in Table 2 as PGS’ annual conservation goals for the period
2025-2034 are appropriate.
Table 2
2025-2034 Achievable Therm Savings Goals
Year Residential
Annual
Residential
Cumulative
Commercial
Annual
Commercial
Cumulative
Total
Annual
Total
Cumulative
2025 	344,604 	344,604 	434,348 	434,348 	778,952 	778,952
2026 	349,768 	694,372 	443,868 	878,216 	793,636 	1,572,588
2027 	355,274 	1,049,646 	412,777 	1,290,993 	768,051 	2,340,639
2028 	359,537 	1,409,183 	419,761 	1,710,754 	779,298 	3,119,937
2029 	362,084 	1,771,267 	427,445 	2,138,198 	785,529 	3,909,465
2030 	366,351 	2,137,618 	434,429 	2,572,627 	800,780 	4,710,245
2031 	370,926 	2,508,543 	441,413 	3,014,040 	812,339 	5,522,584
2032 	374,198 	2,882,741 	451,291 	3,465,331 	825,488 	6,348,072
2033 	375,107 	3,257,848 	458,275 	3,923,606 	833,382 	7,181,454
2034 	376,334 	3,634,182 	465,259 	4,388,865 	841,593 	8,023,047
Source: PSC Document No. 01357-2024
Based on the foregoing, it is
ORDERED that the updated Technical Potential as shown in Table 1 is an adequate
assessment of the full technical potential, and serves as an acceptable basis for the Company’s
annual therm savings goals. It is further
ORDERED that Peoples Gas System’s proposed conservation goals adequately address
the cost-effectiveness considerations enumerated in Section 366.82(3), F.S. It is further
ORDERED that the annual therm savings shown in Table 2 are hereby established as
PGS’ annual conservation goals for the period 2025-2034. It is further
ORDERED that the provisions of this Order, issued as proposed agency action, shall
become final and effective upon the issuance of a Consummating Order unless an appropriate
petition, in the form provided by Rule 28-106.201, Florida Administrative Code, is received by
the Commission Clerk, 2540 Shumard Oak Boulevard, Tallahassee, Florida 32399-0850, by the
close of business on the date set forth in the “Notice of Further Proceedings” attached hereto. It
is further
ORDERED that if no person whose substantial interests are affected by the proposed
agency action (PAA) files a protest within 21 days of the issuance of the PAA Order, a
Consummating Order shall be issued and the docket shall be closed. If a protest is filed within 21
days of the issuance of the PAA Order, the programs shall not be implemented until after the

ORDER NO. PSC-2024-0280-PAA-EG
DOCKET NO. 20240018-EG
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resolution of the protest. Following the issuance of the Consummating Order, Peoples Gas
System shall file a demand-side management plan designed to meet its approved goals.
JHR
By ORDER of the Florida Public Service Commission this 30th day of July. 2024.
Florida Public Service Commission
2540 Shumard Oak Boulevard
Tallahassee. Florida 32399
(850) 413-6770
www.floridapsc.com
Copies 	furnished: 	A copy of this document 	is
provided to the parties of record at the time of
issuance and. if applicable, interested persons.

ORDER NO. PSC-2024-0280-PAA-EG
DOCKET NO. 20240018-EG
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NOTICE OF FURTHER PROCEEDINGS OR JUDICIAL REVIEW
The Florida Public Service Commission is required by Section 120.569(1), Florida
Statutes, to notify parties of any administrative hearing that is available under Section 120.57,
Florida Statutes, as well as the procedures and time limits that apply. This notice should not be
construed to mean all requests for an administrative hearing will be granted or result in the relief
sought.
Mediation may be available on a case-by-case basis. If mediation is conducted, it does
not affect a substantially interested person's right to a hearing.
The action proposed herein is preliminary in nature. Any person whose substantial
interests are affected by the action proposed by this order may file a petition for a formal
proceeding, in the form provided by Rule 28-106.201, Florida Administrative Code. This petition
must 	be 	received 	by 	the 	Office 	of 	Commission 	Clerk, 	2540 	Shumard 	Oak 	Boulevard,
Tallahassee, Florida 32399-0850, by the close of business on August 20, 2024.
In the absence of such a petition, this order shall become final and effective upon the
issuance of a Consummating Order.
Any objection or protest filed in this docket(s) before the issuance date of this order is
considered abandoned unless it satisfies the foregoing conditions and is renewed within the
specified protest period.