Source: http://www.docstoc.com/docs/83137831/June-15_-2009-INDIANA-UTILITY-REGULATORY-COMMISSION
Timestamp: 2014-08-30 17:08:06
Document Index: 409623602

Matched Legal Cases: ['art\n11', 'art\n20', 'art\n20', 'art\n12', 'art\n2', 'art\n6']

THE INDIANA UTILITY REGULATORY                          )
COMMISSION TO APPROVE AN                                )
INDIANA UTILITY
ALTERNATIVE REGULATORY PLAN                             )
PURSUANT TO IND. CODE &#167; 8-1-2.5-1, ET SEQ.,             )
FOR THE OFFERING OF ENERGY                              )
EFFICIENCY CONSERVATION, DEMAND                         )
RESPONSE AND DEMAND-SIDE                                )
MANAGEMENT PROGRAMS AND                                 )      CAUSE NO. 43623
ASSOCIATED RATE TREATMENT                               )
INCLUDING INCENTIVES IN ACCORDANCE                      )
WITH IND. CODE &#167;&#167; 8-1-2.5-1 ET SEQ. AND 8-1-            )
2-42(a); AUTHORITY TO DEFER PROGRAM                     )
COSTS ASSOCIATED WITH ITS ENERGY                        )
EFFICIENCY PORTFOLIO PROGRAMS;                          )
AUTHORITY TO IMPLEMENT NEW AND                          )
ENHANCED ENERGY PROGRAMS AND                            )
APPROVAL OF MODIFICATION OF THE                         )
FUEL ADJUSTMENT CLAUSE EARNINGS                         )
AND EXPENSE TESTS.                                      )
SUBMISSION OF REBUTTAL TESTIMON
Indianapolis Power &amp; Light Company, by counsel, hereby submits the Verified Rebuttal
Testimony and Exhibits of its witnesses as follows:
1.     Ken Flora
2.     Lester H. Allen
3.     John E. Haselden
4.     James L. Cutshaw
5.     Joan M. Soller
ClaudiaJ.   EarlS~---
Phone:         317.231.7279
Fax:           317.231.7433
Email:         claudia.earls@btlaw.com
The undersigned hereby certifies that on June 15, 2009, a copy of Indianapolis Power &amp;
Light Company&#39;s Verified Direct Testimony was served by email transmission to:
Karol Krohn                                           Timothy L. Stewart
Office of Utility Consumer Counselor                  Jennifer Terry
115 W. Washington Street, Suite 1500 South            Bette J. Dodd
Indianapolis, Indiana 46204                           Lewis &amp; Kappes, P.C.
kkrohn@oucc.in.gov                                    One American Square, Suite 2500
infomgt@oucc.in.gov                                   Indianapolis, Indiana 46282
tstewart@lewis-kappes.com
jterry@lewis-kappes.com
bdodd@lewis-kappes.com
Claudia 1. Earls
Claudia J. Earls
Attorney No. 8468-49
Telephone:     (317) 231-7279
INDSOI CEARLS 1130743vl
Petitioner&#39;s Exhibit KF-Rl
VERIFIED PETITION OF INDIANAPOLIS              )
POWER &amp; LIGHT COMPANY REQUESTING               )
THE INDIANA UTILITY REGULATORY                 )
COMMISSION TO APPROVE AN                       )
ALTERNATIVE REGULATORY PLAN                    )
PURSUANT TO IND. CODE &#167; 8-1-2.5-1, ET SEQ.,    )
FOR THE OFFERING OF ENERGY                     )
EFFICIENCY CONSERVATION, DEMAND                )
RESPONSE AND DEMAND-SIDE                       )
MANAGEMENT PROGRAMS AND                        )   CAUSE NO. 43623
ASSOCIATED RATE TREATMENT                      )
INCLUDING INCENTIVES IN ACCORDANCE             )
WITH IND. CODE &#167;&#167; 8-1-2.5-1 ET SEQ. AND 8-1-   )
2-42(a); AUTHORITY TO DEFER PROGRAM            )
COSTS ASSOCIATED WITH ITS ENERGY               )
EFFICIENCY PORTFOLIO PROGRAMS;                 )
AUTHORITY TO IMPLEMENT NEW AND                 )
ENHANCED ENERGY PROGRAMS AND                   )
APPROVAL OF MODIFICATION OF THE                )
FUEL ADJUSTMENT CLAUSE EARNINGS                )
AND EXPENSE TESTS.                             )
VERIFIED REBUTTAL TESTIMONY
Petitioner&#39;s Exhibit KF-R1
VERIFIED REBUTTAL TESTIMONY OF
KEN FLORA, DIRECTOR, REGULATORY AFFAIRS
ON BEHALF OF INDIANAPOLIS POWER &amp; LIGHT COMPANY
CAUSE NO. 43623
1                                       I.      Introduction.
2   Ql.   Please state your name, employer and business address.
3   AI.   My name is Ken Flora. I am employed by Indianapolis Power &amp; Light Company (&quot;IPL&quot;
4         or &quot;Company&quot;), One Monument Circle, Indianapolis, Indiana, 46204.
5   Q2.   Are you the same Ken Flora who prefiled Direct Testimony in this Cause on
6         February 2, 2009 and Supplemental Direct Testimony on May 1, 2009?
7   A2.   Yes.
8   Q3.   What is the purpose of your rebuttal testimony in this proceeding?
9   A3.   The purpose of my rebuttal testimony is to address the following issues raised by the
10         Office of Utility Consumer Counselor (&quot;OUCC&quot;):               (1) various recommendations
11         regarding IPL&#39;s Advanced DSM program; (2) incentive opportunities; and (3)
12         miscellaneous recommendations.       Finally, I provide an introduction of the other
13         witnesses providing rebuttal testimony in this proceeding.
14   Q4.   What is your overall impression of the testimony offered by the OUCC?
15   A4.   IPL is encouraged that the OUCC generally supports IPL&#39;s proposed Core DSM
16         programs although they did propose some modifications.             There is, however, a
17         disagreement between IPL and the    aucc regarding the appropriate incentive levels for
18         DSM.     IPL was disappointed with the OUCC&#39;s response to IPL&#39;s Advanced DSM
19         program. With regard to IPL&#39;s Advanced DSM proposal, the OUCC is requesting the
Flora --1
1         development of detailed plans prior to supporting cost recovery for any test of home area
2         networks (&quot;HAN&quot;) or a time of use (&quot;TOU&quot;) study. Throughout the past two months,
3         IPL has worked collaboratively with multiple vendors to select a viable product set and
4         develop a detailed HAN test plan amongst heightened industry activity in advanced or
5         smart grid technologies and has included timely information in this rebuttal testimony.
6                                    II.      Advanced DSM Program
7   Q5.   avec Witness Paronish indicates that IPL&#39;s Advanced DSM programs should be
8         considered in a separate proceeding. Please respond.
9   AS.   IPL believes the OUCC&#39;s recommendation is administratively inefficient, fails to
10         recognize advanced metering infrastructure as demand-side management, and ultimately
11         serves only to delay realization of potential benefits to IPL customers. IPL is proposing
12         to conduct a HAN test and to study TOU in Phase I of this proceeding. Phase II will
13         include IPL&#39;s proposal to address Advanced Metering Infrastructure (&quot;AMI&quot;).
14         Ms. Paronish provides four reasons why IPL&#39;s Phase II should be moved to a separate
15         docketed proceeding. First, she indicates that other Indiana utilities have filed separate
16         proceedings for AMI and DSM. While IPL is aware of a single Indiana utility that has a
17         separate AMI proceeding currently pending before the Commission, l there is also an
18         example of an Indiana utility that included a request for recovery of interval meters in its
19         DSM proceeding. 2 Ms. Paronish fails to distinguish IPL, an early adopter of automated
20         meter reading (&quot;AMR&quot;), who seeks to take advantage of its advanced position for the
21         benefit of customers through a significant step forward at a relatively modest cost from
Re Petition ofDuke Energy Indian, Inc., Cause No. 43501 filed May 23,2008.
Re Petition ofNorthern Ind. Pub. Servo Co., Cause No. 43618 filed December 4,2008.
1            utilities not at that advanced stage that must take larger, more costly steps to secure
2            benefits for their customers.
3            Second, Ms. Paronish states that the Commission has AMI and DSM investigation cases
4            pending in separate dockets. 3         However, the Commission&#39;s DSM Investigation also
5            includes the issue of Smart Grid technologies and advanced rate design.4
6            Third, Ms. Paronish testified that the          avcc     considers IPL&#39;s Phase II issues to be
7            separate from the issues in this proceeding. As noted above, IPL considers many of the
8            benefits from AMI and Smart Grid technology to be DSM, and therefore appropriate for
9            this proceeding. AMI technology will provide more timely information to customers so
10            they can better manage their energy consumption. The combination of this technology
11            with time-based rates is expected to help reduce energy consumption and shift peak
12            demand. These are both consistent with the Commission&#39;s definition for DSM, which
13            states: &quot;&#39;DSM&#39; means the planning, implementation, and monitoring of a utility activity
14            designed to influence customer use of electricity that produces a desired change in a
15            utility&#39;s load shape, for example, a change in the time pattern and magnitude of a utility&#39;s
16            load. DSM includes only an activity that involves deliberate intervention by a utility to
17            alter load shape.&quot;s
18           In addition, as outlined by IPL Witness Joan Soller, IPL is unique among the Indiana
19           investor owned utilities because IPL already has installed AMR technology and various
Re Commission Investigation into the Effectiveness of Demand Side Management Programs, Cause No.
42693 (&quot;DSM Investigation&quot;); Re Commission Investigation ofSmart Grid Investments and Smart Grid Information
Issues, Cause No. 43580 (&quot;Smart Grid Investigation&quot;)
4        In the DSM Investigation, the Phase II issues list includes Smart Grid technologies and advanced rate
design. These topics were discussed in the 2nd technical workshop held in that proceeding on January 29,2009. and
are addressed in the Phase II Report prepared by the Energy Center of Wisconsin.
5        The defInition ofDSM is found in 170 lAC 4-8-1.
1   one-way distribution automation technologies. Because IPL has already realized many
2   benefits as a result of its early deployment of AMR, IPL&#39;s priorities are focused on the
3   incremental benefits of advanced DSM and related TOU pricing. It is, in part, because of
4   the advanced stage ofIPL&#39;s AMR technology and related benefits that IPL&#39;s vision is not
5   going to necessarily follow the same order of program priorities as utilities without
6   existing system-wide meter automation.
7   Finally, Ms. Paronish indicates that Phase II should be conducted in a separate
8   proceeding because OUCC Witness Keen is requesting additional details regarding IPL&#39;s
9   plan to conduct a HAN test and TOU study. IPL has made its team available at the
10   convenience of the OUCC to explain and discuss any and all details of this filing. Those
11   meetings have taken place with open discussion, and IPL believes it has provided the
12   OUCC with all requested information relative to the pending request for recovery of this
13   research. IPL Witness Soller provides additional information concerning the HAN test in
14   her rebuttal testimony that further supports IPL&#39;s plans.
15   IPL will also be providing additional information in Phase II of this proceeding to support
16   its Advanced DSM programs. IPL plans to include a description of the AMI solution,
17   preferred vendor, system architecture design, and deployment plans. IPL will preview
18   strategic Smart Grid options in Phase II testimony and include a longer term view of this
19   topic in its 2009 Integrated Resource Plan (&quot;IRP&quot;). Ideally if the HAN testing and TOU
20   study occur in parallel with the Phase II regulatory proceeding, the results will be used to
21   drive larger scale program offerings to expedite IPL customer benefits. The anticipated
22   timing of IPL&#39;s testimony in support of Phase II is that it will be consistent with the
23   Company&#39;s request for stimulus funding with the Department of Energy, currently
1            anticipated to be next month (July 2009).
2            Furthennore, the Commission has itself utilized the multi-phase approach for regulatory
3            proceedings, including the current DSM Investigation which began in 2004.                      Several
4            Indiana utilities are also utilizing a multi-phase approach in the joint proceeding to
5            address the Midwest ISO&#39;s ancillary services market (Cause No. 43426).6 The phased
6            approach recognizes that in certain cases, not all issues that are part of a particular
7            proceeding can be addressed simultaneously, but instead require a sequential set of
8            considerations that ultimately assure administrative efficiency is served through the
9            phased approach.
10   Q6.      avcc Witness Keen testifies that IPL does not have a &quot;vision or master plan&quot; of
11            how the Company intends to deploy Smart Grid technology. Do you agree with this
12            statement?
13   A6.     No. IPL set forth its plan to introduce new technology in its direct testimony. 7 The
14           Company&#39;s &quot;vision&quot; is to provide customers more timely energy consumption
15           infonnation and potentially be able to automatically control devices in the home to
16           improve demand response and energy efficiency capabilities. An AMI system will create
17           a foundation that the Company can build upon in the future to provide demand response,
18           dynamic pricing and improved outage infonnation to our customers.                        IPL Witness
19           Bentley described in his direct testimony additional benefits that would result from an
20           advanced communication system including additional bandwidth and flexibility to
Re Joint Petition for Approval ofCertain changes in Operations Likely to Result from Midwest Independent
Transmission System Operator, Inc. &#39;s Implementation of revisions to its Open Access Transmission and Energy
Markets Tariff to Establish a Co-Optimized, Competitive Market for Energy and Ancillary Services Market, Cause
No. 43426 filed January 18, 2008.
7       See Direct Testimony of Ken Flora at pp. 31-32.
1           expand distribution automation applications. Mr. Bentley also stated that IPL will be
2           able to gain additional meter and operations improvements that leverage the two-way
3           communication network.         Other benefits and future uses of AMI technology were
4           explained in more detail in Mr. Bentley&#39;s direct testimony.
5           In fairness to Mr. Keen&#39;s inability to discern IPL&#39;s VISIOn, the Company&#39;s direct
6           testimony did not include hype or incorporate a catchy slogan. Instead, it outlined IPL&#39;s
7           desire to leverage its already advanced position and take another substantive step forward
8           with DSM, including the deployment of Smart Grid HAN technology for advanced
9           residential DSM. IPL has an overarching vision to be the best which manifests itself in
10           this instance to a measured yet substantial step forward. Working on the cutting edge of
11           technology can be messy and difficult. However, benefits come too late to customers if
12           one waits for all the problems to be solved before moving forward. IPL believes it has
13           struck the appropriate balance with its proposal of making progress without over
14           committing in advance of the Commission&#39;s comprehensive investigations into DSM and
15           Smart Grid.
16   Q7.     Please explain how this desire to be the best shaped IPL&#39;s vision for deploying
17           Smart Grid technology.
18   A7.     IPL was one of the first utilities in the Country to begin deployment of an AMR system
19           more than a decade ago 8 . This year, IPL conducted a proof of concept (&quot;POC&quot;) to test
20           AMI and the results of this test, along with extensive due diligence into AMI, will lead to
21           a subsequent Advanced DSM program proposal in Phase II of this proceeding. In Phase I
The IPL contract with Cellnet (AMR technology provider) was signed in September 1997. Deployment
Flora -- 6
1         of this proceeding, the Company is proposing to test HAN using its current AMR system.
2         The use of HANs will provide more timely and granular energy consumption information
3         to residential and smaller commercial and industrial customers to help them manage their
4         energy consumption decisions.
5         A significant benefit that could result from a successful test of the HAN with IPL&#39;s AMR
6         system is the ability to deploy HANs without the need to change out all of IPL&#39;s AMR
7         systems. Instead, the Company could roll out AMI in a phased approach. This phased
8         approach would mitigate the rate impact to IPL&#39;s customers and still provide the energy
9         and demand reduction benefits that are anticipated to come from the use of HANs.
10   Q8.   Is there any additional information you would like to share regarding IPL&#39;s Smart
11         Grid plan?
12   A8.   Yes.    IPL formulated high level goals to investigate ways to optimize existing
13         technologies and systematically deploy additional technologies that will bring significant
14         benefits in 2008.   Initiating AMI for demand meters, which are currently manually
15         probed, was identified as a short term initiative to provide customers with near real time
16         energy usage information. The execution of initial goals began in January 2009 with the
17         AMI POC, which was not considered a total success.          The American Recovery &amp;
18         Reinvestment Act of 2009 was enacted into law in February 2009. These events led IPL
19         to seek a brief delay in the advanced DSM portion of Phase I of this proceeding to
20         explore whether any changes should be made to its AMI and other Smart Grid initiatives.
21         The next step is to conduct a test of the HAN to gain information about whether this
22         technology is compatible with our AMR system and to gain valuable information about
23         customer behavior with energy consumption, including the impact of time-based rates on
Flora --7
1          energy consumption simultaneous with Phase II of this proceeding.
2   Q9.    In your opinion, is the AMR based testing necessary regardless of what AMI or
3          other advanced technologies IPL proposes to initiate as part of a Smart Grid in the
4          future?
5   A9.    Yes. Testing is essential to ensure that future investments are prudent. IPL&#39;s current
6          proposal in Phase I of this proceeding is to defer the cost of the HAN POC and the TOU
7          study and implementation costs. The total estimated cost for the HAN POC and the TOU
8          study, including implementation costs, is $500,000.     IPL Witness Soller discusses in
9          more detail IPL&#39;s proposed HAN test.
10   QIO.   avec Witness Keen questions why IPL appears to be indecisive on deploying an
11          AMI system. Please respond.
12   AlO.   We strongly object to Mr. Keen&#39;s characterization and believe he has mistaken prudence
13          for indecision. As discussed above, IPL installed an AMR system on its energy-only
14          meters a decade ago. This technology provides some of the same benefits of an AMI
15          system, including the ability to automatically read these meters. IPL has also installed
16          certain distribution automation equipment, as was described by IPL Witness Bentley in
17          his direct testimony. IPL was an early adopter of AMR and only recently have there been
18          industry developments that imply significant incremental benefit to deploying AMI at
19          IPL. Those developments include wireless HANs and the advancement of other Smart
20          Grid technology that may provide additional benefits, including the provision of near
21          real-time energy consumption information and HVAC and appliance control for all
22          classes of customers in a cost effective manner, and therefore warrant evaluation of AMI.
23   Qll.   Is IPL planning to deploy a full AMI system at this time?
Flora -- 8
1   All.   No, not at this time. The deployment of AMI to all of IPL&#39;s customers would likely cost
2          well in excess of $130 million and would have a significant impact on rates. Any full
3          AMI deployment plan would also likely be coupled with the installation of additional
4          distribution automation equipment. Although the Company is not planning for a full
5          AMI deployment at this time, there are significant benefits that can be achieved from a
6          partial deployment. Further details concerning IPL&#39;s proposal for AMI will be discussed
7          in Phase II of this proceeding.
8   Q12.   ouec Witness Foster states that IPL should not be permitted to recover the cost of
9          a TOU study without a clear vision of how, or if, IPL will incorporate the results of
10          the TOU study. Please respond to this statement.
11   A12.   In supplemental testimony, IPL indicated that the deferred costs are proposed to be
12          recovered through IPL&#39;s proposed Standard Contract Rider No. 22, coincident with the
13          offering of time-based pricing to customers. Thus, IPL&#39;s proposal is consistent with Mr.
14          Foster&#39;s recommendation.      The TOU study will provide a recommendation for the
15          structure of the TOU rate offering(s). Following the completion of the study, IPL plans
16          to propose a new TOU tariff. In fact, the target is to time the offering of a TOU rate with
17          the HAN POC test so that in addition to gaining information about technology feasibility,
18          information will be gained regarding IPL customers&#39; responsiveness to TaU rates. The
19          aucc did not ask any specific discovery questions about this study.
20   Q13.   Has the ouee testified concerning dynamic pricing in other proceedings?
21   A13.   Yes, in the Commission&#39;s Smart Grid Investigation, the aucc testified that &quot;[a]n
22          increase in dynamic pricing options can offer significant economic benefits to customers
Flora -- 9
~..   .
1           and further justifies the cost effectiveness of smart grid investment9 .&quot;
2   Q14.    Has the IURC provided direction with regard to offering TOU rates and the use of
3           AMR technology?
4   A14.    Yes. The Commission&#39;s Order in its investigation into smart metering and time based
5           pricing (Cause No. 43083) included the following language: &quot;[t]he Commission
6           recognizes that with respect to residential customers, at least initially, on-peak/off-peak,
7           time-of-use, critical peak pricing, or the installation of Automated Meter Reading
8           technology may hold more immediate potential than real-time pricing products, which
9           would require the use of smart meters that utilize special communication software and
10           could require modification of the utility&#39;s billing system. While this is not a foregone
11           conclusion, it is time for those electric utilities that offer TOU tariffs to their residential
12           customers to consider greater promotion and expansion of such programs.&quot;IO
13   Q15.    Is your proposal in this proceeding consistent with the Commission&#39;s direction in
14           Cause No. 43083?
15   A15.    Yes. IPL is proposing to test HAN technology with its existing AMR system and to
16           study TOU pricing with the intent that TOU rates will be offered simultaneously with the
17           test of this technology.      This is an important part of IPL&#39;s vision to take another
18           significant step forward to blend existing and new technology to provide customers
19           increased choices and to help them manage their energy consumption.
20   Q16.    Is there an emphasis on Smart Grid technology in federal legislation?
OUCC Witness Satchwell testimony in Smart Grid Investigation at p. 7.
Re Investigation as to Whether it is Appropriate to Provide and Install Meters and Communications
Devices to Allow for Customer Participation in Time-based Pricing and other Demand Response Programs; Cause
No. 43083 (&quot;EPAct05 Investigation&quot;) at p. 36.
Flora --10
1   A16.   Yes. The Energy Policy Act of 2005 amended the Public Utility Regulatory Policy Act
2          (&quot;PURPA&quot;), including changes to Section 1252, Time Based Metering and
3          Communications. These changes resulted in a requirement that state regulatory agencies
4          investigate whether it is appropriate for utilities to provide and install time-based devices
5          for each of their customer classes. This resulted in the Commission&#39;s initiation of Cause
6          No. 43083. The Energy Independence and Security Act of 2007 (&quot;EISA&quot;) also amended
7          PURPA as it relates to Smart Grid, this time to require states to consider rate recovery
8          issues, obsolete equipment and the provision of information to customers. This resulted
9          in the Commission&#39;s initiation of the Smart Grid Investigation.
10                                            III.    Incentives
11   Q17.   Do you have concerns with the incentives that OUCC Witness Sumner proposes?
12   A17.   Yes.   Ms Sumner&#39;s proposal is significantly different from IPL&#39;s proposal in four
13          respects: (1) it excludes a large portion of the Core DSM program expenditures from any
14          incentive opportunity; (2) it prevents full recovery of program costs if measurement and
15          verification results indicate that savings are less than 50% of the target; (3) it significantly
16          lowers the incentive level for performance at or greater than 100% of target; and (4) it
17          removes any incentive to perform above the target by awarding a 12% incentive for any
18          performance at or above 100% of target. IPL Witness Haselden addresses in detail IPL&#39;s
19          concerns with regard to Ms. Sumner&#39;s proposal, but I would note that from a policy
20          perspective her proposals are contrary to long standing public policy.           The National
21          Energy Policy Act of 1992 urged state regulatory commissions to establish such
22          regulation:
23                 [t]he rates allowed to be charged by a State regulated electric utility shall
24                 be such that the utility&#39;s investment in and expenditures for energy
Flora --11
1                    conservation, energy efficiency resources, and other demand side
2                    management measures are at least as profitable, giving appropriate
3                    consideration to income lost from reduced sales due to investments in and
4                    expenditures for conservation and efficiency, as its investments in and
5                    expenditures for construction of new generation, transmission, and
6                    distribution equipment. 16 U.S.C. &#167; 2621(d) (8); see also 15 U.S.c. &#167;
7                    3203(b) (4).
8            IPL&#39;s proposal is supported by a 2004 National Association of Regulatory
9            Commissioners (&quot;NARUC&quot;) Resolution which encourages state commissions to &quot;address
10            regulatory incentives to address inefficient use of gas and electricity&quot; as well as an
11            August 2, 2006 Resolution which supports the Environmental Protection Agency&#39;s
12            (&quot;EPA&quot;) National Action Plan for Energy Efficiency (&quot;NAPEE&quot;) including &quot;[modifying]
13            policies to align utility incentives with the delivery of cost-effective energy efficiency
14            and modify ratemaking practices to promote energy efficiency investments.&quot;ll The need
15            for a new approach to move the needle on DSM was recognized in a November 2007
16            resource report supporting NAPEE. 12 Congress recognized the importance of removing
17            disincentives and motivating utilities to pursue energy efficiency through incentive
18           mechanisms in the recently enacted EISA, which encourages state regulators to &quot;integrate
19           energy efficiency into electric and natural gas utility, State, and regional plans and
20            adopting policies establishing cost effective energy efficiency as a priority resource.,,13
21                                  IV.      Miscellaneous Recommendations
22   Q18.    OVCC Witness Paronish recommends the Commission establish an Oversight
23           Board. Do you agree with this recommendation?
24   A18.    No, not in this proceeding.           The Commission&#39;s DSM Investigation is specifically
See NARUC, Resolution on Gas and Electric Energy Efficiency, July 14, 2004; NARUC, Resolution
Supporting the National Action Plan on Energy Efficiency, August 2,2006.
12       National Action Plan for Energy Efficiency (2007). Aligning Utility Incentives with Investment in Energy
Efficiency. Prepared by Val R. Jensen, ICF International. www.epa.gov/eeactionplan.
13       16 U.S.c. &#167; 262l(d).
Flora --12
1          addressing whether oversight boards should be established for Indiana electric utilities.
2          Of course, IPL will follow the Commission&#39;s decision regarding the administration of
3          DSM programs or any other issue decided in the Commission&#39;s DSM Investigation. It
4          should be emphasized, however, that IPL has a long history of working collaboratively
5          with its stakeholders, as discussed by IPL Witness Allen.
6   Q19.   OUCC Witness Paronish recommends that any Commission order approving IPL&#39;s
7          Core DSM programs should include a provision incorporating any future generic
8          requirements resulting from Phase II of the Commission&#39;s pending DSM
9          Investigation. Is this necessary in this proceeding?
10          No. As discussed above, IPL will comply with Commission orders requiring IPL to take
11          action, including an order in the DSM Investigation.
12                                V.   Introduction of Other Witnesses
13   Q20.   Who will be providing rebuttal testimony on behalf of the Company in this
14          proceeding?
15   A19.   Below is a brief summary of the witnesses and the corresponding subject matter of their
16          rebuttal testimony:
17          •      Mr. Lester H. Allen, Team Leader, Marketing and Program Management, is filing
18                 rebuttal testimony to explain why the creation of an IPL Oversight Board is not
19                 necessary at this time, address several issues that OVCC Witness Paronish
20                 identified with IPL&#39;s DSM Program proposal, and be more explicit in describing
21                 IPL&#39;s intended approach to Evaluation, Measurement &amp; Verification.
22          •      Mr. John E. Haselden, Principal Engineer, is filing rebuttal testimony to address
Flora --13
1                 the aucc&#39;s concerns in regards to free ridership estimates, avoided capacity cost
2                 estimates and proposed shareholder incentives.
3          •      Mr. James L. Cutshaw, Revenue Requirements Manager, is filing rebuttal
4                 testimony to correct misconceptions in the direct testimony of aucc Witness
5                 Foster concerning IPL&#39;s cost recovery proposal in this proceeding and cost
6                 deferral and subsequent recovery of the TOU study, and to address the OUCC&#39;s
7                 cost recovery recommendations.
8          •      Ms. Joan M. Soller, Senior Regulatory Analyst, is filing rebuttal testimony to
9                 address points made by aucc Witness Keen regarding the timing and detail of
10                 IPL&#39;s proposed HAN POC and describe how IPL&#39;s proposed studies synchronize
11                 with its overall Smart Grid plans.
12   Q21.   Does this conclude your rebuttal testimony?
13   A20.   Yes.
Flora -- 14
L Ken Flora. Director. Regulatory Afhlirs of Indianapolis Power &amp; Light Company.
aflirm under penalties of peljury that the foregoing representations are true and correct to the
best of Illy knowledge, information and belief.
Dated: June 15,2009
Petitioner&#39;s Exhibit LHA-R1
VERIFIED REBUTTAL TESTIMONY OF LESTER H. ALLEN
1   Ql.   Please state your name, employer and business address.
2   AI.   My name is Lester H. Allen. I am employed by Indianapolis Power &amp; Light Company
3         (&quot;IPL&quot;), One Monument Circle, Indianapolis, Indiana 46204.
4   Q2.   Are you the same Lester H. Allen who prefiled Direct Testimony in this Cause on
5         February 2, 2009 and Supplemental Direct Testimony on March 12, 2009?
6   A2.   Yes.
7   Q3.   What is the purpose of your rebuttal testimony in this proceeding?
8   A3.   First, I would like to acknowledge and thank OVCC Witness Paronish and the OVCC for
9         generally being supportive of the expanded set of DSM programs that IPL has proposed
10         to offer to our residential and commercial customers. The purpose of the remainder of
11         my rebuttal testimony is to (1) explain why the creation of an IPL Oversight Board is not
12         necessary at this time; (2) address several issues that OVCC Witness Paronish identifies
13         with the IPL DSM Program proposal; and (3) provide a more explicit description ofIPL&#39;s
14         intended approach to evaluation, measurement and verification (&quot;EM&amp;V&quot;).
15   Q4.   OUCC Witness Paronish indicates that the formation of an Oversight Board is
16         essential for the cost effective and efficient delivery of DSM programs. Do you
17         agree?
18   A4.   No. Ms. Paronish&#39;s assertion that an Oversight Board is a prerequisite for the continued
19         successful delivery of IPL&#39;s DSM programs is not correct.         IPL has successfully
20         delivered DSM programs on essentially a continuous basis for over 15 years. IPL has
21         done this without an Oversight Board, but not in a vacuum. IPL has a long standing
Allen -1
Petitioner&#39;s Exhibit LHA-Rl
1         tradition of working collaboratively with the      aucc,   Citizens Action Coalition of
2         Indiana, Citizens Gas and Coke Utility (&quot;Citizens Gas&quot;) and other interested parties to
3         develop programs that provide cost effective DSM and energy efficiency for the benefit
4         of its customers. For example, IPL has met at least annually with stakeholders to discuss
5         its Air Conditioning Load Management (&quot;ACLM&quot;) program (Standard Contract Rider
6         No. 13), to share program plans and results and to solicit input on program changes. IPL
7         intends to continue this process if the Commission approves the proposed DSM
8         programs.
9         IPL will continue this approach of working collaboratively with the   aucc, on a more
10         frequent basis if requested, to share information and receive feedback regarding program
11         delivery.
12   Q5.   Ms. Paronish states that a detailed program design has not been completed for all of
13         the proposed programs that are necessary for Commission approval of the
14         requested set of programs. Do you agree?
15   AS.   No, in my view detailed program design is not necessary for Commission approval. IPL
16         has significant experience in the delivery of the majority of the Core DSM programs
17         being proposed in this proceeding.       Several of the programs that IPL proposes are
18         modifications of existing programs that the Company is currently successfully delivering
19         (ACLM; Income Qualified Weatherization; Energy Efficiency Education; Renewable
20         Energy Education). The delivery approaches and results for these programs have been
21         periodically communicated to the      aucc     staff and included in IPL&#39;s Annual DSM
22         Reports.    IPL also has extensive experience in the delivery of commercial programs,
23         similar to those contained in this proposal.
1         For these current programs and the new programs being proposed, design summaries
2         were provided in direct testimony in both the DSM Market Potential Study (Petitioner&#39;s
3         Exhibit LHA-2) and the Testimony of Witness Matthew Rose.
4         The majority of the new programs are proposed to be delivered cooperatively with
5         Citizens Gas. IPL and Citizens Gas have informally begun this process and will continue
6         to work together to develop a more detailed plan for the delivery of these programs. In
7         some cases the vendors that are selected through a formal solicitation process will also
8         contribute to detailed program design.        IPL will continue to provide transparent
9         information through its annual reporting of program results.
10   Q6.   OUCC Witness Paronish proposes that the funds IPL proposes for use in its
11         Residential Low and Moderate Income Weatherization program should not be
12         eligible for reallocation to other programs. Please respond.
13   A6.   As indicated in my direct testimony, IPL agrees with this approach.        In my direct
14         testimony, I state &quot;IPL proposes that the annual spending for the Income Qualified
15         programs not be included in the annual program budget rebalancing.       This solidifies
16         IPL&#39;s commitment to its Income Qualified Weatherization program by safeguarding
17         against dollars being shifted to other programs.&quot;!
18   Q7.   OUCC Witness Paronish recommends that IPL should separately track existing
19         ACLM switches from new ACLM switches. Please respond.
20   A7.   Since the Commission did not authorize incentives for IPL&#39;s existing program, IPL has
21         created a new set of project numbers to separately track ACLM switch installation costs.
Allen Direct at p. 19.
1         IPL will take this approach for all of the programs that represent a continuation from its
2         existing DSM program.
3         Thus, only the switch installation costs incurred after the effective date of the new DSM
4         programs will be identified as eligible for incentives and lost margins.        Likewise,
5         customer accounts will be identified to clearly delineate whether the customer became a
6         participant under IPL&#39;s existing DSM program or under the new DSM program to allow
7         for separate accounting ofthe incentives paid to participants.
8         With that said, IPL does not intend to separately track maintenance and replacement costs
9         by ACLM switch vintage. IPL&#39;s experience indicates that only a relatively small number
10         of switches will require maintenance and/or replacement each year and will not justify
11         the additional administrative burdens of separately tracking switch maintenance cost by
12         vintage.
13   Q8.   OUCC Witness Paronish indicates that the EM&amp;V approach as described by IPL is
14         not adequate and the Oversight Board should select an independent third-party.
15         Please comment.
16   A8.   IPL proposes to follow the EM&amp;V approach that was suggested by our consultant in the
17         Market Potential Study (Petitioners Exhibit LHA-2). IPL agrees with Ms. Paronish that
18         the evaluation should be conducted by an independent third-party.            International
19         Performance Measurement Verification Protocols (&quot;IPVMP&quot;) will be used, when found
20         appropriate by the third party, to conduct an assessment of the programs and an analysis
21         of the demand and energy savings achieved by the programs.
1   Q9.    OVCC Witness Paronish questions whether the EM&amp;V budget has been
2          appropriately allocated and recommends the Oversight Board review the EM&amp;V
3          budget on a program-by-program basis. Do you agree?
4   A9.    No. The estimated costs by program were primarily based on recommendations provided
5          by Forefront Economics in the Market Potential Study. The estimated costs were based
6          on the professional judgment and significant experience the consultant had with DSM
7          program evaluations conducted by other utilities with similarly situated programs. The
8          costs as proposed in the Market Potential Study were amended to better reflect a three
9          year implementation period.
10   QIO.   Does this conclude your prepared rebuttal testimony?
11   Ala.   Yes, at this time.
L Lester II. Allen. Team Leader. Marketing and Program Management of Indianapolis
Po&#39;,ver &amp; Light Company. aflim1 under penalties of perjury that the foregoing representations are
true and correct to the best of my knowledge, information and belief
Da~d;   June 15,2009
INDSO! CEr\RLS J 1305 &#39;O\&#39; I
Petitioner&#39;s Exhibit JEH-R1
JOHN E. HASELDEN
JOHN E. HASELDEN, PRINCIPAL ENGINEER, REGULATORY AFFAIRS
2   AI.   My name is John E. Haselden. I am employed by Indianapolis Power &amp; Light Company
3         (&quot;IPL&quot; or &quot;Company&quot;), One Monument Circle, Indianapolis, Indiana, 46204.
4   Q2.   Are you the same John E. Haselden who prefiled Direct Testimony in this Cause on
5         February 2, 2009 and Supplemental Direct Testimony on May 1, 2009?
8   A3.   The purpose of my rebuttal testimony is to address concerns raised by the OVCC in
9         regards to (1) IPL&#39;s estimation of free ridership in the proposed lighting program; (2)
10         IPL&#39;s estimation of avoided costs; and (3) proposed shareholder incentives.
11   Q4.   OVCC Witness Satchwell states that IPL used a free-ridership estimate for its
12         lighting program that is too low. 1          Do you agree with his assessment and its
13         consequences?
14   A4.   No. IPL uses a net-to-gross ratio which includes other factors besides free-ridership.
15         These other factors include free-drivers, persistence, spill-over and take-back effects.
16         IPL&#39;s estimation of the net-to-gross ratio is not too low. In addition, with regard to Mr.
17         Satchwell&#39;s reference to Northern Indiana Public Service Company&#39;s proposed DSM
Satchwell Direct at page 6, lines 7-15.
Haselden -- 1
Petitioner&#39;s Exhibit JEH-Rl
1         lighting program in Cause No. 43618, the measures IPL plans to include in its lighting
2         program may be different than those proposed by Northern Indiana Public Service
3         Company.     IPL recognizes that common Compact Fluorescent Lights (&quot;CFLs&quot;) have
4         experienced increased acceptance, have dropped in price in recent years and may not
5         warrant a rebate over the long term that is a high percentage of their retail price.
6         However, newer CFLs that are decorative, more compact, 3-way capable or dimmable,
7         are relatively expensive compared to their incandescent counterparts and will require
8         much higher rebates than that necessary for common CFLs if they are to penetrate the
9         market. The net-to-gross ratio for these product segments, which IPL will include in its
10         program, is expected to be significantly higher than for standard CFLs.
11         I agree with Mr. Satchwell&#39;s conclusion that there are no adverse consequences of using a
12         50% net-to-gross ratio instead of an 80% ratio. The program is robust enough to still
13         pass the Total Resource Cost (&quot;TRC&quot;) test with only a 50% net-to-gross ratio and is cost
14         effective.
15   Q5.   avec     Witness Satchwell also expressed concern that the Transmission and
16         Distribution (&quot;T&amp;D&quot;) component of the avoided cost estimate was too high. 2 Do you
17         agree with his assessment and its consequences?
18   A5.   No. IPL used 10% of avoided generation cost to approximate avoided T&amp;D capacity
19         costs. 170 lAC 4-7-4(16) requires that avoided T&amp;D costs be included in the avoided cost
20         estimate for evaluating DSM programs and thus IPL includes it. This same methodology
21         has been used by IPL for many years in its DSM evaluations, integrated resource
22         planning and in its calculation of Rate CGS. Determining the impact of DSM program
Haselden -- 2
1         savings on avoided T&amp;D capacity costs cannot be done with a high degree of accuracy
2         for many reasons. The primary reason is that the T&amp;D capacity constraints, and attendant
3         opportunities for possible T&amp;D capacity savings, are geographically specific while DSM
4         program implementation generally is not.                  Distribution circuits that have adequate
5         capacity and serve customers that implement DSM measures will not experience any
6         avoided capacity savings that can be attributed to the DSM programs. The converse is
7         obviously true for circuits nearing capacity but the degree of impact cannot be predicted
8         nor accurately estimated because of the geographically random nature of DSM
9         implementation interacting with other sometimes larger impacts of new construction
10         growth or economic decline. While IPL&#39;s estimate ofT&amp;D avoided costs may be higher
11         than estimates of other utilities as opined by Mr. Satchwell, as demonstrated by the
12         sensitivity analysis conducted by Mr. Satchwell, even if these avoided costs are
13         completely excluded from the benefit-cost ratio (&quot;BCR&quot;) calculations, the programs that
14         were cost effective are still cost effective. I agree with this conclusion by Mr. Satchwell
15         and it again demonstrates the robustness of the cost effectiveness of the proposed DSM
16         programs.
17   Q6.   OVCC Witness Satchwell takes exception to your statement that &quot;the Midwest ISO
18         has no capacity market from which to draw appropriate market capacity values.,,3.
19         Do you agree with his assessment?
20   A6.   No. Mr. Satchwell referred to the short-term Midwest ISO voluntary capacity auction
21         and cherry-picked a low value for the month of June, 2009 as &quot;an appropriate starting
22         place to estimate the market value of capacity.&quot; Mr. Satchwell failed to note that June
Satchwell Direct at page 7, lines 9-22 through page 8, line 1.
Haselden -- 3
1         2009 was the very first month for which this auction was conducted and he also failed to
2         note that the clearing price for the subsequent month of July, 2009 was $10,050/month.
3         August prices will clear on June 25,2009. When asked in discovery what the next step
4         would be in using this &quot;appropriate starting place,&quot; Mr. Satchwell responded, &quot;[t]he next
5         step that builds on the $50 price would be speculative in nature.,,4        When asked in
6         discovery whether the Midwest ISO voluntary capacity auction provides a short-term or
7         long-term price, the response was, &quot;Mr. Satchwell believes that the Midwest ISO
8         voluntary capacity auction provides both a short-term and long-term price signal.&quot;s
9         Those familiar with this new auction recognize that the capacity auction is intended to be
10         a last resort option for Midwest ISO market participants to acquire capacity in the very
11         near term to avoid penalties for resource insufficiency. DSM programs are evaluated
12         over the long-term life of their measures and the corresponding capacity costs they avoid.
13         Using a single off-peak month&#39;s spot price from an auction designed to be very short-
14         term (a period of time of approximately one year) as a starting point for estimating a
15         long-term avoided cost is clearly inappropriate.
16   Q7.   Mr. Satchwell asserts that IPL&#39;s avoided cost methodology is inconsistent with other
17         Indiana electric utility avoided cost methodologies?6 Please respond.
18   A7.   As Mr. Satchwell notes, the Commission has not defined an avoided cost methodology
19         and it is fair to say that all Indiana electric utilities&#39; methodologies are inconsistent to
20         some degree with each other. It should not be inferred from Mr. Satchwell&#39;s statement
21         that all of the other utilities&#39; methodologies are consistent with each other but not with
Satchwell Direct at page 8, line 8 through page 9, line 2.
Response to IPL Data Request 1-9.
Response to IPL Data Request 1-8.
Satchwell Direct at page 9, lines 3-11.
Haselden -- 4
1         IPL&#39;s. Mr. Satchwell admitted in discovery that all Indiana utilities&#39; methodologies are
2         inconsistent.?    I agree with Mr. Satchwell&#39;s statement that, &quot;[a] consistent approach
3         between utility avoided cost inputs would be advantageous in the understanding and
4         analysis of DSM BCR test results&quot; and that this topic would more appropriately be
5         discussed in Phase II of the Commission DSM investigation in Cause No. 42693.
6   Q8.   OVCC Witness Sumner has proposed a different shareholder incentive structure
7         than that proposed in your earlier direct testimony. Do you have comments on the
8         OVCC&#39;s proposal?
9   A8.   Yes. First, I appreciate that the    avcc agrees with IPL and the provisions of the Indiana
10         Administrative Code that shareholder incentives are appropriate.        However, I do not
11         agree with the exclusions and the levels proposed by the avcc.
12   Q9.   Please explain your concerns with the OVCC&#39;s proposed exclusions.
13   A9.   avcc witnesses Paronish and Sumner have proposed excluding IPL&#39;s programs that do
14         not pass the TRC test from eligibility to earn a shareholder incentive.        Neither Ms.
15         Paronish nor Ms. Sumner explained their reasoning for their recommendation.         avcc
16         witness Sumner cited the restrictions of 170 IAC 4-8-7(c) concerning application of
17         shareholder incentives to programs for which kW demand or kWh energy impacts cannot
18         reasonably be determined. This is certainly not the case for the Low and Medium Income
19         Weatherization and Renewable Incentives programs and is thus not a basis for exclusion
20         of these programs. In addition, the     avcc does recognize that there may be other value
21         realized from the programs beyond the economic values quantified, and recommend their
Response to IPL Data Request 1-11.
Haselden -- 5
1          implementation8 . These programs will all contribute to energy efficiency and a reduction
2          in energy consumption either directly or indirectly. The Energy Efficiency Education
3          programs and the Indirect Costs have not been modeled to claim any energy or demand
4          impacts nor lost revenues and thus have a TRC ratio of zero. IPL did this as a means for
5          recognizing the activities and costs included in a transparent way. One alternative would
6          have been to allocate these costs to the various programs and include them with each
7          program&#39;s BCR analyses.                 The valuable support these activities lend to the
8          implementation and acceptance of the other DSM programs is not disputed.            These
9          activities were also recommended to be administered in this way in the Market Potential
10          Study (Petitioner&#39;s Exhibit LHA-2, page 35), a process in which the OUCC participated.
11          The OUCC has stated that these programs are &quot;core programs.&quot; IPL&#39;s position is that
12          these programs are essential to the overall success of its DSM Plan and are therefore
13          worth incentivizing so as to overcome the throughput incentive as previously described
14          by IPL Witness Flora. 9 In summary, no incentive is a disincentive to IPL to put forth the
15          effort and financial resources to implement programs that yield no return. This frustrates
16          the intent of the shareholder incentive concept.
17   QIO.   Please describe your concerns with OVCC Witness Sumner&#39;s proposed shareholder
18          incentive structure.
19   AI0.   Ms. Sumner used a tiered shareholder incentive structure similar to that proposed by IPL
20          except that the proposed percentages are much lower and even negative at the lowest tier.
21          Ms. Sumner provided a summary of her research into shareholder incentives offered in
22          other states and used them as a barometer for a range of reasonableness. Unfortunately,
Paronish Direct at page 11, line 10 through page 12, line 8.
Haselden -- 6
1          most of the incentive percentages listed in the overview on page 1 of Ms. Sumner&#39;s
2          Attachment JAS-1 are applicable to net benefits realized and not program spending. This
3          is an apples-to-oranges comparison and an inappropriate gauge.            Ms. Sumner also
4          recommends that there be a penalty assessed if less than 50% of the goal is attained. This
5          could have the unintended consequences of further discouraging utility efforts or unfairly
6          penalizing the utility when, despite its best efforts, the ability to achieve the minimum
7          target is not within the control of the utility.
8          In summary, IPL believes the function of the shareholder incentive is to encourage a high
9          level of implementation performance. A consequence of lower than 60 percent of target
10          savings represents a failure to earn a shareholder incentive on DSM expenditures and is
11          its own penalty that need not be compounded with another penalty. IPL is also concerned
12          about the lack of a tiered incentive for achieving better than 100% performance. This is a
13          fundamental and critical aspect of the tiered structure that provides an incentive to the
14          utility for finding ways to get better results for essentially the same expenditures. This is
15          a win-win proposition for all stakeholders.
16   Qll.   Does this conclude your rebuttal testimony?
17   All.   Yes.
Flora Direct at page 26, lines 13-16.
Haselden -- 7
VERlFICATION
L John E. Haselden. Principal Engineer. Regulatory Affairs of Indianapolis PO\ver &amp;
Light Company, afJirm under penalties of perjury that the foregoing representations are true and
correct to the best of my knowledge, information and be&#39; f.
Petitioner&#39;s Exhibit JLC-R1
JAMES L. CUTSHAW, REVENUE REQUIREMENTS MANAGER
2   AI.   My name is James L. Cutshaw. I am employed by Indianapolis Power &amp; Light Company
4   Q2.   Are you the same James L. Cutshaw who prefiled Direct Testimony in this Cause on
8   A3.   The purpose of my rebuttal testimony is to (1) correct misconceptions in the direct
9         testimony of OUCC Witness Foster concerning IPL&#39;s cost recovery proposal in this
10         proceeding and cost deferral of the time of use (&quot;TOU&quot;) study, and (2) address the
11         OUCC&#39;s cost recovery recommendations.
12   Q4.   OUCC Witness Foster claims that for Advanced Meter Infrastructure (&quot;AMI&quot;)
13         costs, IPL initially proposed to defer recovery, including a return on and of capital
14         costs, together with incremental operation and maintenance expenses associated
15         with the new meters, for recovery in a subsequent rate case.! Is this assertion
16         correct?
17   A4.   No. There was never any mention by IPL of deferring the AMI costs for recovery in a
Foster Direct at p. 5, lines 5-7.
Cutshaw --1
Petitioner&#39;s Exhibit JLC-Rl
1         subsequent rate case. IPL initially proposed timely recovery of the costs to install the
2         AMI communications upgrade, including the replacement of approximately 6,400
3         demand meters for Commercial &amp; Industrial (&quot;C&amp;I&quot;) customers in Phase I of its DSM
4         Plan. (Direct testimony of IPL Witness Flora at page 8, lines 19 and 20.) The Phase I
5         AMI costs were further clarified to be the capital cost of the communication system,
6         including implementation, along with an incentive on the expenditure. (Direct testimony
7         of IPL Witness Flora at page 21, lines 19 through 21.) The Phase I AMI costs were
8         clearly reflected in the cost recovery schedules determining the impact of the proposed
9         Core and Advanced DSM Adjustment which were attached to my direct testimony as
10         Petitioner&#39;s Exhibits JLC-4 and JLC-5 (lines 27 through 30).
11         Mr. Foster correctly states that according to IPL Witness Flora&#39;s supplemental testimony,
12         IPL intends to move forward with its Core DSM programs, but is proposing a brief delay
13         in its request to recover costs associated with AMI by removing it from consideration in
14         Phase I and addressing it in Phase II of this Cause. The removal of the Phase I AMI costs
15         is clearly reflected in the cost recovery schedules determining the impact of the proposed
16         Core and Advanced DSM Adjustment which were attached to my supplemental
17         testimony as Petitioner&#39;s Exhibits JLC-4 (Revised) and JLC-5 (Revised) (lines 27
18         through 30). This delay does not represent a request by IPL to defer AMI costs for
19         recovery in a subsequent rate case.
20   Q5.   Are there any costs that IPL is proposing to defer for future recovery in this Phase
21         of the proceeding?
22   A5.   Yes. IPL continues to seek authority to defer, for recovery following their completion,
23         the costs of a Home Area Network Proof of Concept (&quot;HAN POC&quot;) and a Time-of-Use
1         (&quot;TaU&quot;) pricing study. (Supplemental testimony of IPL Witness Flora at page 4, lines 1
2         through 3.) These deferred costs are proposed to be recovered through IPL&#39;s proposed
3         Standard Contract Rider No. 22, coincident with the offering of time-based pricing to our
4         customers. (Supplemental testimony of IPL Witness Flora at page 4, lines 13 through
5         15.)
6   Q6.   OUCC Witness Foster states that in general, the use of deferred accounting should
7         be limited to no more than three years after plant goes into service. 2 Will that be a
8         concern for the HAN POC and TOU pricing study costs that IPL is proposing to
9         defer for future recovery?
10   A6.   No. As stated in my supplemental testimony, IPL is proposing that these costs will be
11         included in future DSM factors reflecting the recovery of costs authorized in Phase II.
12         The timeline for the HAN pac and TaU pricing study and the proposed implementation
13         of TaU rates in Phase II is included in the rebuttal testimony of IPL Witness Soller and
14         shows that the deferral would be less than three years.
15   Q7.   OUCC Witness Foster also states that the OUCC recommends that utilities,
16         including IPL, utilize a more traditional regulatory treatment for cost recovery of
17         an advanced metering initiative - e.g. periodic rate case proceedings, deferred
18         depreciation, and/or post-in-service Allowance for Funds Used During Construction
19         (&quot;AFUDC,,).3 Do you concur?
20   A7.   Not in this case. As explained by other IPL witnesses, the purpose of the proposed AMI
21         costs is to enable DSM programs. The costs will be incurred and the assets placed in
Foster Direct at p. 6.
1           service in phases rather than all at one time. It should be noted that Congress and the
2           Federal Energy Regulatory Commission both support timely recovery of AMI costs.
3           Therefore, IPL continues to believe that the AMI costs should receive the same timely
4           recovery as more traditional DSM program costs.
5   Q8.     OUCC Witness Foster states that approving cost recovery for the TOU study
6           proposed in this case would be inappropriate at this time and should be evaluated in
7           a separate AMI proceeding. 4 How do you respond?
8   A8.     IPL is not requesting current recovery of the costs of the TaU study. As explained
9           above, IPL is requesting to defer the costs of the TaU study for recovery in Phase II
10           coincident with the offering of time-based pricing to our customers.
11   Q9.     Do you agree with OUCC Witness Foster that IPL should not be able to defer the
12           cost of the HAN poe and TOU study at this time?
13   A9.     No, I do not. I find this position contrary to the aucC&#39;s position taken in previous
14           testimony filed in other causes.
15   QIO.    Please explain.
16   A10.    The aucc has supported the development and testing of technology time-based rates in
17           previous causes.     The aucc provided support for TaU rates in the Commission&#39;s
18           investigation of TaU rates in Cause No. 43083. 5 In Northern Indiana Public Service
19           Company&#39;s DSM proceeding (Cause No. 43618), Mr. Keen discussed phased deployment
20           of Smart Grid components and included TaU rate offerings as an example of policy and
Foster Direct at pp. 7, 8.
No. 43083.
1          operational changes that should be tested along with technology. Mr. Keen stated:
2                   Initially, and regardless of the type of technology to be deployed in the
3                   first phase, the utility would utilize some type ofpilot program to test and
4                   evaluate not only the technology, but any significant policy and
5                   operational changes which may be deployed and implemented in the
6                   specific phases. Examples of policy and operational changes may involve
7                   time-of-use rate offerings, dynamic pricing offerings, energy usage data
8                   made available to the consumer; renewable energy generation
9                   development and other items. Keen direct testimony at p. 12, lines 4-10.
10          In Indiana Michigan Power Company&#39;s TaU Tariff proceeding (Cause No. 43607),
11          aucc Witness Paronish explained the process of developing TaU rates and supported
12          testing the offerings in a limited fashion. 6
13          Most recently, in Duke Energy Indiana&#39;s Smart Grid proceeding (Cause No. 43501), Mr.
14          Keen clearly identified what he called &quot;the most significant benefit smart grid technology
15          offers to any class of consumers is the personal empowerment they find by having control
16          over their own energy usage and monthly energy bills.&quot; Mr. Keen further noted the
17          ability of Smart Grid technology to provide tools including &quot;value-enhancing dynamic
18          pricing.&quot;? These customer benefits may be realized with HAN equipment coupled with
19          TaU rate offerings such as IPL has proposed. Mr. Keen further recommended a pilot
20          program to test HAN technology. 8
21   Qll.   Does this conclude your rebuttal testimony?
22   All.   Yes.
See direct testimony of Ms. Paronish in Cause No. 43607 at page 5, lines 4-14.
See direct testimony ofMr. Keen in Cause No. 43501 at p. 12, lines 17-23.
!d. at p. 44, line 18 through p. 45, line 3.
VERIFICATIO::\
L James L. Cutshaw. Revenue Requirements Manager of Indianapolis Power &amp; Light
Company. affim1 under penalties of perjury that the foregoing representations are true and
coneet to the best of my knowledge, infom1ation and belief.
, ..~                          ~)
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lNllSOI (&#39;EARLS 1130:\7.,,]
Petitioner&#39;s Exhibit JMS-R1
PURSUANT TO IND. CODE &#167; 8-1-2.5-1,ET SEQ.,     )
SPONSORING PETITIONER&#39;S EXHIBITS JMS-R2 THROUGH JMS-R4
JOAN M. SOLLER, SENIOR REGULATORY ANALYST
2   AI.   My name is Joan M. Soller. I am employed by Indianapolis Power &amp; Light Company
4   Q2.   Are you the same Ms. Soller that prefiled Supplemental Direct Testimony in this
5         Cause on May 1, 2009?
6   A2.   Yes I am.
8   A3.   The purpose of my rebuttal testimony is to respond to several points raised by OUCC
9         Witness Keen related to the timing of IPL&#39;s proposed Home Area Network (&quot;HAN&quot;)
10         Proof of Concept (&quot;POC&quot;). I will describe how these studies synchronize with IPL&#39;s
11         overall Smart Grid initiative plans, provide HAN   pac   specifics, including the selected
12         vendor and draft test plan, and describe IPL&#39;s due diligence process to determine an
13         effective Advanced Metering Infrastructure (&quot;AMI&quot;) system solution.
14                                  SMART GRID INITIATIVE
15   Q4.   Do you agree that the phrase &quot;Smart Grid&quot; may be defined differently by energy
16         industry stakeholders?
17   A4.   Yes.    I believe Smart Grid functionality as defined in the Energy Independence and
18         Security Act of 2007 encompasses application options ranging from partial to full
Soller --1
Petitioner&#39;s Exhibit JMS-Rl
1         automation which utilities may initiate based upon their specific business objectives. A
2         utility may select one or more Smart Grid elements from which to derive operational
3         benefits for its customers, shareholders or other energy stakeholders.
4   Q5.   Has IPL considered how it is currently or may in the future initiate these automated
5         functions?
6   A5.   Yes. As shown in Petitioner&#39;s Exhibit JMS-R2, IPL has identified concrete ways in
7         which it is currently achieving each of these functions or may choose in the future to
8         deploy additional functionality.
9   Q6.   How are various Smart Grid elements related?
10   A6.   Three essential areas of advanced or &quot;smart&quot; technology deployment, Advanced
11         Metering Infrastructure (AMI), Demand Side Management (DSM) and Distribution
12         Automation (DA), are inter-related by communication backhaul and integrated back
13         office software systems. As explained by Witness Flora, prior to the development of
14         current   two-way     communicating     AMI     technology,     IPL      deployed     one-way
15         communicating Automated Meter Reading (&quot;AMR&quot;) technology that is able to achieve
16         some, but not all, of the benefits of advanced technology deployment.
&quot;Smart&quot; Technology Components
1         While prior to deployment adequate provisions should be considered to integrate all three
2         areas, IPL&#39;s request in this proceeding is limited to AMI and DSM. In particular, Phase I
3         of this proceeding is focused solely on the TaU rate design study and HAN testing as
4         components of the DSM element.          As described by IPL Witness Flora in his
5         supplemental testimony, IPL&#39;s requested a brief delay in seeking approval to initiate an
6         AMI solution is to allow IPL staff to thoroughly consider its AMI deployment options.
7   Q7.   Is it possible to develop alternative ways to accomplish automation or focus on
8         varying Smart Grid elements?
9   A7.   Yes. In fact, IPL considers its existing AMR and one-way control of distribution devices
10         as building blocks upon which to develop additional automation. IPL is not aware of any
11         other Indiana investor-owned utility with a similar level of advanced or automated
12         devices. Over the past 20 years, IPL has systematically deployed Supervisory Control
13         and Data Acquisition (&quot;SCADA&quot;) in 95% of its distribution substations, installed
14         automated controls for approximately 83% of its switched capacitor banks, installed and
15         automated 56 distribution line switches and upgraded 95% of its down-line reclosers with
16         microprocessor-based programmable controls which will accommodate radios to provide
17         remote functionality.     These incremental investments in tools to maintain system
18         reliability and manage costs have benefited customers through outage minimization.
19         While much of this hardware was installed prior to the emergence of the phrase &quot;Smart
20         Grid,&quot; it does facilitate automation.
21   Q8.   Mr. Keen suggests that &quot;a master plan, in a very high-level sense, should have been
22         developed before the utility began the deployment of AMR technology years ago
1           ...&quot;.1 Is that reasonable?
2   A8.     No. This retroactive analysis is not productive and seems to imply that a utility should
3           use a crystal ball to accomplish long-term planning. As a practicing distribution engineer
4           in the early 2000s when IPL was implementing its AMR solution, I can attest that there
5           were very few one-way, let alone two-way, comprehensive and cost-effective automated
6           solutions during that time period. Significant technological advancements have occurred
7           since then and will continue to evolve which is why prudent planning may include phased
8           deployment of advanced technologies. Utilities that decided to implement systems as
9           early movers should not be penalized. In addition, utilities should minimize equipment
10           obsolescence as part of their migration plans. 2
11   Q9.     Do you believe that every utility should plan to install a fully functional Smart
12           Grid?
13   A9.     Not necessarily. As described above, the term Smart Grid is so broad that working to
14           accomplish a &quot;fully functioning&quot; goal will likely be akin to hitting a moving target. In
15           addition, functions necessary to provide benefit to customers and stakeholders should be
16           reasonable and system specific.         For example, creating a goal of complete circuit
17           automation on a circuit with very few customers on a radial line is not likely to be cost
18           effective.
Keen Direct at p. 14, lines 6-8.
This is consistent with the Federal Energy Regulatory Commission draft Smart Grid policy statement
which was published in March 2009 in Docket No. PL09-4-000, p. 37, section 51.
1                                 HOME AREA NETWORK TESTING
2   QI0.    What are the core HAN functions that IPL proposes to test?
3   A10.   The five key functions that IPL plans to test are as follows:
4          •      Successfully intercept an AMR signal, convert it to Zigbee and interface to in-
5                 home display and a programmable thermostat;
6          •      Collect energy usage on a 15 minute interval basis using AMR meters and
7                 communicate billing quality information to IPL for purposes of implementing
8                 TOU rates of up to 4 &quot;buckets&quot; or pricing periods through a customer broadband
9                 connection;
10          •      Enable demand response capabilities through IPL&#39;s control of thermostat set-back
11                 through a HAN system;
12          •      Present &quot;near real time&quot; energy information to end-user customers through a web-
13                 based application; and
14          •      Provide IPL access to end-use customer data for near real time data for analysis
15                 and measurement and verification of demand response resources.
16   Qll.   What is the basis for IPL&#39;s plan to complete the HAN testing at this time?
17   All.   IPL believes testing the HAN with the existing AMR technology in a limited fashion is
18          necessary to determine how to best deploy AMI investments. If a customer broadband
19          service is capable of providing the second leg in a feedback loop to accomplish &quot;two-
20          way&quot; communication, incremental investment in AMI may not be needed in all locations;
21          rather, AMI may be targeted to areas that can best benefit from two-way meters.
1           According to Mr. Satchwell&#39;s testimony in the Commission&#39;s investigation of Smart
2            Grid, 3 significant representative costs range near $100-$400 per AMI meter and do not
3           include communication backhau1 requirements. 4 If customers do not have broadband
4           service, IPL may propose to offer an AMI-based HAN solution, perhaps with varying
5           incentives as an alternate future solution.        In addition, testing time-based rates with
6           existing technologies will provide meaningful information for future rate offerings and
7           allow customers to benefit from advanced technologies in advance of an AMI
8           deployment.
9   Q12.    Did IPL meet with the       ouec to discuss the HAN poe and to provide a high-level
10           timeline related to its Advanced DSM plans?
11   A12.    Yes, IPL met with Mr. Keen on May 12 and May 19,2009 to discuss how the HAN and
12           TOU study components synchronized with its Advanced DSM plan and provided at that
13           time a high level timeline, a copy of which is shown in Petitioner&#39;s Exhibit JMS-R3.
14           During these meetings, Mr. Keen expressed his preference to consider HAN testing a
15           &quot;Pilot&quot; instead of a &quot;Proof of Concept.&quot; The parties agreed to call the HAN testing
16           process simply &quot;testing&quot; for the duration of the meetings. IPL plans a limited duration
17           testing period to assess the technical feasibility of using its existing AMR meters to
18           provide energy management tools for customers.
19   Q13.    Does IPL agree with Mr. Keen&#39;s assessment of the need to test equipment for a
20           longer period of time through specific stages based upon the maturity of HAN
Re Commission Investigation of Smart Grid Investments and Smart Grid Information Issues, Cause No.
43580 (&quot;Smart Grid Investigation&quot;).
4       See direct testimony of Mr. Satchwell in Cause No. 43580. page 4, line 2.
1          technology?5
2   A13.   No. IPL notes the many studies that have been completed nationally and internationally
3          to assess the effectiveness of providing energy information to customers as a means to
4          reduce consumption in terms of kW and kWh.                   fu fact, the      aucc   mentioned these
5          studies in its presentation during the technical conference in the Commission&#39;s Smart
6          Grid fuvestigation and in direct testimony filed in that proceeding. 6 fu addition, HAN
7          components including programmable communicating thermostats and energy displays
8          have been sold in commercial retail stores for many years. The unique elements of the
9          proposed HAN test are the integration of HAN vendor software to the in-home
10          components using AMR signals, the ability to control the air conditioning through
11          signaling the thermostat, and the ability for the HAN vendor to provide 15 minute billing
12          data to IPL. Since IPL is a summer peaking utility, it seems logical to collect information
13          during the shoulder months of spring and fall in addition to the summer months. fu
14          addition, the ability to include a larger number of homes for a more robust test is
15          preferred over a longer time period to fit within the proposed budget parameters. IPL
16          understands that to prolong the HAN test period to collect 12 months of data may require
17          a modest increase in vendor costs, and is willing to negotiate this arrangement if the
18          Commission prefers this strategy.
19   Q14.   Please describe the due diligence that has occurred in the last two months to
20          evaluate and fine tune the HAN testing plans.
Keen Direct at p. 26, lines 11-16.
See direct testimony ofMr. Satchwell in Cause No. 43580, page 4, footnote 2.
1   A14.   IPL staff sought detailed infonnation from the limited number of vendors in this niche
2          market. Three of four vendors responded to a Request for Infonnation (&quot;RFI&quot;) and met
3          with an IPL due diligence team to discuss and in some cases demonstrate hardware and
4          software functionality.   The team scored each vendor according to evaluation criteria
5          including:
6          1.     The ability of the solution to accomplish the five key functions listed above
7          2.     System Data Accessibility
8          3.     Data Security and Interoperability
9          4.     Implementation Cost
10          5.     Feasibility and Project Planning
11          6.     Additional Functionality to accommodate appliances and electric vehicle charging
12          7.     Service Level Agreement support
13          8.     Test Plan Robustness including the number of homes in the test
14          9.     Proven HAN Experience
15          10.    Intuitive customer end-user &quot;friendliness&quot;
16          11.    Inclusion of User and Administrator Education/Training
17          12.    Ability for HAN equipment to migrate to AMI, and
18          13.    Dispute resolution support.
20   Q15.   Has the due diligence team selected a vendor yet?
21   A15.   Yes, subject to successful negotiation of a final agreement, the due diligence team has
22          selected Tendril, Inc. (&quot;Tendril&quot;) as the HAN vendor.
23   Q16.   Has IPL developed a draft test plan?
24   A16.   Yes. Petitioner&#39;s Exhibit JMS-R4 contains the draft test plan, which includes input from
1          IPL staff, Tendril and a University of Indianapolis statistics professor, whose expertise is
2          representative of a third party evaluator that IPL plans to engage for the HAN test. This
3          exhibit includes a redacted version of Tendril&#39;s response to IPL&#39;s RFI, technical
4          specifications, and product infonnation.
5   Q17.   Has IPL developed a breakdown of the proposed $300,000 HAN testing budget?
6   A17.   Yes. Estimated costs for specific HAN testing components are as follows.
Test Plan Development, Data Verification and Analysis                     30,000
Program administration and marketing                                      15,000
HAN Equipment &amp; Software Deployment and Project                          240,000
Management over a 12 month period
Pre-test direct customer solicitation and post-test surveys               15,000
Total                                                                    300,000
8   Q18.   Are you aware of other investor-owned utilities that plan to test this equipment?
9   A18.   Yes. Ameren UE in Missouri and NSTAR in Massachusetts have expressed plans to test
10          an AMR-based HAN solution. IPL has spoken with the HAN test project manager from
11          Ameren who agreed to share its findings of testing in approximately 50 employee homes
12          which is scheduled for June through September 2009. The NSTAR test includes 3,000
13          homes and is pending regulatory approval. Both of these utilities plan to use Tendril and
14          Ameren also utilizes the same Landis + Gyr AMR system that IPL uses.
15          IPL plans to limit the initial HAN testing to the use of a web portal, in-horne displays,
16          programmable communicating thennostats in single family homes to manage costs and
17          avoid scope creep, but understands Tendril has plug-in devices that may be tested in the
18          future and repeaters available that may be used in multi-family dwellings where distances
19          between meters and living units vary.
1                                   AMI DUE DILIGENCE UPDATE
2   Q19.   Please describe IPL&#39;s efforts to select an effective AMI solution in preparation for
3          Phase II of this proceeding.
4   A19.   Technical staff from IPL&#39;s IT, Customer Billing, Metering, Telecommunications,
5          Distribution Operations and Planning, Strategic Accounts, and Regulatory areas have met
6          regularly with multiple vendors to develop an AMI recommendation. The chart below
7          indicates the vendors with whom IPL staff have interfaced since January of this year
8          listed by products that IPL plans to include in its AMI solution.
L+G                    Aztech                                           Akuacom
Elster                 Comver e                  emeter/Siemens         Invaluable Technolo ies
GE/Silver Springs
Network                GE                        Itron                  IPL Web A     Iication staff
Itron                  Grid oint                 PrimeStone             Itron - MY Web
Sensus                 Invaluable Technolo ies                          Schneider Electric/SquareD
Smart S   ch           Radio Thermostat                                 WeatherWise
Tendril                                          Zi han
E3/ Greentech
10          In addition, IPL staff discussed various applications, products and interfaces with staff
11          from utilities around the United States as shown below:
Soller --10
United Illuminating              L+G AMR and AMI (vI8)
Schneider Electric/Square D - C&amp;I usage data
Plan to deploy HAN later
Colorado Springs Utilities       L+G AMR for residential and AMI for demand meters (v 18) - +/- 300K
electric meters and +/- 200K water meters, 3/4 through deployment
PECO                             L+G AMR, Sandbox testing (v 18) AMI with DA focus
Indiana Michigan Power           GE/SSN AMI with Radio Thermostat HAN
Austin Energy                     L+G AMI (v 18) - limited HAN
Working with Ecologic Analytics as MDMS vendor
OnCor                             L+G AMI (Command Center) with limited HAN
emeter now moving to EA for MDMS
Ameren - MO                       L+G AMR (vI??), Tendril AMR+ HAN
Southern California Edison        Itron Open Way, MDM later- 5 million meters over 3 1/2 yrs, strong customer
marketin   Ian
3   Q20.   avec Witness Keen states: &quot;[Ylet this agency continues to be perplexed by what we
4          perceive to be a lack of research on IPL&#39;s part in examining existing full-function
5          operational AMI systems and their supporting communications infrastructures as
6          they continue to decide on the equipment to be used and the configuration the
7          system will have once deployed.,,7 Please respond.
8   A20.   I find this statement disturbing and do not understand the basis for Mr. Keen&#39;s
9           &quot;perception.&quot; The            avec asked specific discovery questions about the AMI design to
10          which IPL responded specific details are not yet known but will be determined as part of
Keen Direct at page 18, lines 3-7.
Soller --11
1          the vendor selection process. 8 In addition, the     avcc asked IPL to provide the names of
2          the vendors with whom it had discussions with regarding HAN equipment capable of
3          intercepting AMR signals and/or AMI signals. 9 IPL provided the same names of the
4          HAN vendors that are listed above. The          avcc did not ask any other questions about
5          what AMI vendors or other utilities IPL had spoken with throughout our due diligence
6          process. As shown in the table above, IPL has reached out to many resources to assess
7          viable AMI options. IPL staff recognizes the complexity of this proposed solution and is
8          working to recommend the best solution for customers and the Company. This is one of
9          the reasons that IPL requested a brief delay to present significant detailed information in
10          Phase II of this proceeding.
11   Q21.   What additional statement did Mr. Keen include in his testimony that is not well-
12          founded?
13   A21.   Mr. Keen stated that &quot;[g]iven the level of deployment worldwide that AMI technology
14          has enjoyed for close to a decade, the        avcc     questions why IPL appears to remain
15          indecisive on deploying an AMI system.&quot;IO              The request for a brief delay in this
16          proceeding is not founded on indecision whether or not to deploy AMI; it is founded
17          upon ensuring IPL chooses the best AMI solution with a deployment plan that optimizes
18          the opportunity to receive stimulus funding to mitigate the rate impact to IPL customers.
19          Mr. Keen failed to mention that IPL sent the AMI pac test results to the aVCc. 11 The
20          initial testing indicated communication success rates that were not acceptable to IPL
See Response to avcc Data Request 3.2 and 3.3
See Response to avcc Data Request 3.6.
Keen Direct at page 18, lines 16-18.
See Response to avcc Data Request 3.5 and Attachments 3.5-B1, 3.5-B2, and 3.5-C
1          which Mr. Keen did not dispute. In fact, IPL provided the test plan for Phase II of the
2          AMI poe which Landis + Gyr is in the process of completing, a fact that Mr. Keen failed
3          to mention as well.
4   Q22.   What progress has been made in IPL&#39;s efforts to recommend an AMI solution?
5   A22.   The research and due diligence efforts of IPL staff are on target to complete the
6          evaluation process over the next few weeks and to arrive at a recommendation in early
7          July upon which IPL&#39;s case-in-chief in Phase II of this proceeding (as well as a request
8          for federal stimulus funding) will be based. IPL hopes this timing will essentially benefit
9          IPL customers who may benefit from well-established plans and possibly gain the value
10          of matching grant funding of up to $.50 for each $1.00 of costs.
11   Q23.   Does this conclude your rebuttal testimony?
12   A23.   Yes.
Soller --13
VERIFIC&quot;,nON
L Joan M. Soller. Senior Regulatory Analyst of Indianapolis Power &amp; Light Company.
IPL                                                                  lURC Cause No. 43623                                                       Exhibit JMS - R2
EISA - 2007 Smart Grid                                         IPL Applications                                     Approximate Timeline
Increased use of digital infonnation and       The majority ofIPL&#39;s distribution substations are connected          Active now and is expected to continue
controls technology to improve                 to SCADA; 56 of its switches are automated and accessible               annually in a systematic fashion.
reliability, security, and efficiency of the   through a 2 way communication system; 95% ofIPL&#39;s down
electric grid.                                 stream recloser controls are microprocessor based and can
accommodate two-way radios. The majority of IPL&#39;s
switched capacitor banks are operated remotely through a
one-way communication system. As IPL considers AMI, it
will ensure the communication system is scalable to deploy
additional Distribution Automation (DA) devices. Common
industry data protocols are used including DNP and RS 232.
2     Dynamic optimization of grid                  IPL IT staff monitor developments in this area continuously.                    Now and ongoing
operations and resources, with full cyber-     IPL also works with SME&#39;s to understand changes in the
security.                                      FERC and NERC regulations. IPL will include contract
language in all technical contracts to ensure the latest cyber
security standards are deployed.
3    Deployment and integration of                  AMI solutions will include bi-directional metering for use                  Phase II - 2010 and 20 II
distributed resources and generation,          with solar panels, batteries or wind turbines. In addition,
including renewable resources.                 HAN data presentation will include ability for customer to
see output on-line and/or in the home. IPL plans to test
several scenarios of optional HAN equipment to assess
4    Deployment and incorporation of                HAN functionality will include ability to control thennostats          Phase I and II - 2009 through 2011
demand response, demand-side                   and potentially other devices if tariff approval is achieved to
resources, and energy-efficiency               do so. IPL wants to optimize existing DLC equipment while
resources.                                     deploying updated technology to customers interested in
TOU rates. In addition, IPL plans to provide C&amp;I customers
with near real-time energy usage infonnation.
5    Deployment of &quot;smart&quot; technologies             HAN will support tracking usage data by device and provide             Phase I and II - 2009 through 20 II
(real-time, automated, interactive             customer with interactive data. IHD data is planned to based
technologies that optimize the physical        on meter signals to the zigbee device (- 5 minutes and could
operation of appliances and consumer           be customized) Data to be presented on-line will be
devices) for metering, communications          processed through a verification engine to minimize
concerning grid operations and status,         variances in billing estimates.
and distribution automation.
6    Integration of &quot;smart&quot; appliances and          The most recent version of Zigbee technology will be used to           Phase I and II - 2009 through 20 II
consumer devices.                              interface with commercially available devices. In addition,
the HAN vendor is working with AMI vendors, appliance
and device manufacturers to facilitate remote finnware
updates and minimize integration expenses.
7    Deployment and integration of advanced         The ability to monitor vehicle charging as well as send a           Phase II - 2010 and 201 land Project Plug-
electricity storage and peak-shaving           pricing signal to trigger charging start and stop is available in             IN 2010 through 2013
technologies, including plug-in electric       the HAN systems. The ability to send a message to a vehicle
and hybrid electric vehicles, and thennal      to provide energy to the market also reside in the HAN
storage, air conditioning.                     system interfaces. In addition, access to this infonnation on-
line will be built in. IPL is also a participant in a separate
project to deploy and study the use of 100 electric vehicles
IPL                                                           IURC Cause No. 43623                                                   Exhibit JMS - R2
EISA - 2007 Smart Grid                                   IPL Applications                                 Approximate Timeline
8     Provision to consumers of timely          IPL is very focused on providing information to customers         Phase I and II - 2009 through 20 II
information and control options.          about their energy usage through In Home Displays,
thermostat interfaces and web access. In addition, IPL
receives daily meter readings for all of its energy only meters
through the existing Automated Meter Reading (AMR)
system. Part ofIPL&#39;s Phase II plan is to investigate the
possibility of integrating this data through data presentation
software to show all customers daily usage. Studies have
shown that sharing this information has resulted in energy
conservation and has become known as the &quot;Prius&quot; effect
since it mirrors the electric Prius vehicle dashboard.
Showing customers kWh per day data is likened to showing a
driver mpg data to support conservation decisions. In
addition, bill estimation functions can indicate $ per day or $
day to month for customers to better manage their energy
9      Development of standards for             IT and NERC CIP compliance staff stay abreast of                          Now and ongoing
communication and interoperability of     developments. Work with vendors and include contract
appliances and equipment connected to     language to address evolving standards. IPL will work with
the electric grid, including the          each vendor to create roadmaps to achieve compliance.
10    Identification and lowering of            IPL plans to assess customer perceptions of barriers through              Now and ongoing
unreasonable or unnecessary barriers to   the HAN deployment and follow-up surveys. In addition,
adoption of smart grid technologies,      IPL will assess technology challenges and implement
practices, and services.                  solutions to tackle obstacles to integrate systems including
OMS, DA, SCADA, and future programs. IPL&#39;s primary
focus is to leverage a phased deployment of AMI and use the
existing AMR system for which we have contracted services
through 2017 to the fullest capacity to provide customers
with tools to save energy and reduce demand during peak
Petitioner&#39;s Exhibit JMS-R3
IPL DSM Program - High Level Timeline (Draft)
_ _ _ _ _ _ _ _ _. . . .                                                   ......                                                        i[r~!&amp;~*&#39;;&amp;;:{F#i1:;K;:;~t:;g::;St;1&#39;&#183;;~\&#39;!,,&quot;&gt;:&quot;&#39;.
7/28/2009              9/1/2009                                                                                          12115/2009                                                            41112010
IPL File            Estimated                                                                                        Possible                                                           Estimated IURC
Phase 2 Request         IURC Order:                           111112009                                               Phase 2 Hearing                                                         Order on TOU
Stimulus Request         Core DSM                      File TOU Tariff with IURC                                        (Adv.DSM)                                                          Initiate TOU Pricing
(Adv.DSM)
(Adv. DSM)            TOU StUdy
HAN POC (AMR)                                                   8/1 &#183;411
711&#183;7130
Decisions                                      9/1 &#183;11/1                                                                                                          11/1- 3130
(Adv.DSM)                                   TOU Rate Analysis                                                                                 HAN POC (AMR) • Installation
61112009          7/112009              81112009        9/112009         101112009            11/1/2009                     121112009                                        11112010                    211/2010   3/1/2010
5/112009                                                                                                                                                                                                                                                411/2010
5/1/2010&#183;10/3112010
Home Area Network&#183; POC Test (With TOU Pricing and AMR Meters)
(..-------------------A.-------------------.,
I                        ,                     ,                      i                      I                           I                                                       t
61112010                7/1/2010                8/1/2010              9/1/2010                 101112010
5/1/2010                                                                                                                                                                10/31/2010
_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _11III_ _11IIII             fIIIIlI_ _   IlIlIll_!!l!I!i!lm!illK&#39;rBl:if.Eix~.lliijm7~&#39;ili&#39;;{m:l:q0~6J;_f~:&quot;&#39;&#183;                                           Page 1
DRAFT TEST PLAN                                               Petitioner&#39;s Exhibit JMS-R4
Page lof34
r~sS~ny                Home Area Network (HAN) Proof of Concept Scope
IPL is interested in deploying a scalable HAN system deployment through a Home Area
Network (HAN) system as part of its advanced demand side management plans. Possible
HAN system components may include bridge/gateway communication device, Programmable
Controllable Thermostat (PCT), In-Home Display (nID), customer and IPL web portal
access. In addition, IPL may offer customers the option to purchase an outlet device to
monitor and control specific appliance usage directly from the HAN vendor.
The Company currently uses an Automated Meter Reading (AMR) system managed by
Landis + Gyr for approximately 460,000 energy only meters and manually probes
approximately 6,400 demand meters for meter reading purposes.
IPL plans to continue to leverage the AMR system by continuing to utilize it to read the
majority of its energy only meters. Simultaneously, IPL intends to develop a scalable means
to automate reading its demand meters through a 2 way communication system, provide
enhanced usage information to its customers and investigate HAN opportunities to enhance
Demand Response (DR) through the AMR and AMI communication backbones.
The Company is interested in deploying an initial HAN Proof of Concept based on the AMR
platform to customers throughout the IPL service territory and certain community leaders. lPL
is hopeful that it can deploy HAN systems in a large scale to reach approximately 22,000
energy only metered customers in the future. This may entail utilizing its one-way meters and
future two-way meters to offer time-based rates and enable demand response depending upon
the success of the POCo
lPL anticipates working collaboratively with the HAN vendor and a third party evaluator
(&quot;TPE&quot;) to craft a robust and meaningful test plan including the objectives listed below,
review results, and recommend refinements. lPL will utilize existing analysts to acquire data
from IPL&#39;s customer accounting and load research systems.
1. Test technical effectiveness of intercepting an AMR signal, transferring it to an nID
and using customer broadband to display information though a web-portal.
2. Test effectiveness of displaying the energy information for IPL use through the
3. Test customer responsiveness to energy information and pricing signals through the
• Establish 5 test subgroups with the following means to communicate electricity
usage and pricing information:
A. Control group with existing rates and load research meters
Page 1 of2                                6/15/09
DRAFT TEST PLAN                                                Petitioner&#39;s Exhibit JMS-R4
C. Web portal and llID                                               Page 2 of34
D. Web portal and PCT
E. Web portal, llID and PCT
•   Establish baseline usage for each of the 5 subgroups
•   Collect usage data and analyze
Testing tasks including preparation and analysis ofRAN data will likely include the following
items. The parties involved and estimated time period are shown for each task.
Expected Testing Tasks
1. Identify sample size needed for statistical validity for each subgroup based on a total
of 150 to 160 in the experimental group plus at least 150 homes in the control group.
(IPL and TPE - Month 1)
2. Conduct TOU study separately to design rates. (IPL and rates Consultant- Months 1 to
3. Utilize random number generator to identify sample (IPL and TPE - Months 1 and 2))
4. Acquire customer participation (IPL - Months 2 and 3))
5. Measure baseline energy consumption for control group and all participants (IPL and
TPE - Months 2 and 3)
6. Conduct pre-install surveys (HAN vendor - Months 3 and 4)
7. Install HAN systems (HAN vendor- Months 3, 4 and 5 customer dependent))
8. Measure effectiveness of communication signals - meter to llID and HAN system to
IPL (IPL and HAN vendor - Months 4 and 5)
9. Provide feedback to HAN deployment team and customers if changes are needed.
(Months 4 and 5)
10. Measure actual customer usage as means to assess customer responsiveness to price
and usage information in each of 5 subgroups based on the difference in usage (HAN
Vendor will provide data, IPL will compile and analyze data, TPE will validate data
and research protocol. Months 4 through 12)
11. Collect daily RAN data and sum monthly to compare to AMR readings on to verify
accuracy for billing purposes (IPL will analyze and TPE will validate the data and
research protocol. Months 4 through 12)
12. If a critical peak pricing program is recommended, authorized and initiated, calculate
actual price elasticity ratio based upon participants responses and compare to the
control group (IPL will analyze data and TPE will validate the data and research
protocol. Months 4 through 12)
13. Conduct post-test surveys (HAN Vendor with input from TPE in creation and
validation phases - Month 13)
14. Utilize data for future load research (IPL - Month 13 and beyond)
15. Recommend refinements and next steps (All parties - Months 13 and 14)
Page 2 of2                                 6/15/09
Petitioner&#39;s Exhibit JMS-R4
Smart Energy for Life                                                                          Cause No. 43623
Indianapolis Power &amp; Light
Tendril Residential Energy Ecosystem (TREE)
Response to RFI Regarding Scalable Home Area Network Proof of Concept
Tendril is pleased to present Indianapolis Power &amp; Light (IPL) with this proposal for a residential demand-
side energy management pilot. The goal of this pilot is to achieve IPL&#39;s primary objectives using Tendril&#39;s
&quot;game changing&quot; solution for conswner-focused energy management. This pilot will establish for IPL
Tendril&#39;s unequaled ability to a) provide near real-time visibility into conswner behaviors and energy
consumption patterns; and b) validate conswner responses to energy efficiency and demand response
This document will provide IPL with an overview of the Tendril Residential Energy Ecosystem (TREE)
and explain in detail how IPL can leverage TREE to extend the value of its existing Cellnet (Landis &amp; Gyr)
Advanced Meter Reading (AMR) infrastructure.
In addition to meeting the stated objectives, the proposed pilot will demonstrate for IPL the extensibility of
the Tendril solution and validate the value of TREE as a long-term investment. The TREE solution meets
IPL&#39;s immediate needs as they relate to energy efficiency and demand respond programs as well as
providing the infrastructure to support and validate any future programs.
Smart Energ&quot;y   FOi   Life                                                                        Cause No. 43623
.About Tendril and TREE
Tendril Networks, Inc. is the leading energy management software solutions provider to the energy
industry. Our market leading technology facilitates a two-way dialog between energy providers and their
consumers allowing them to work in concert to reduce energy consumption. Because the Tendril solution
is designed to facilitate information exchange in real-time it delivers a level ofconsumer empowerment not
offered by any other solution on the market.
Tendril&#39;s unique solution provides utilities and energy retailers with detailed information on how their
residential customers consume energy and gives consumers the simple tools they need to monitor, manage
and control their energy consumption. By allowing this free flow of information TREE enables a host of
powerful programs including demand response, energy efficiency and pricing.
Tendril is an active and high-profile participant in the development of open standards solutions for
residential energy management and our unique approach can help IPL understand the direct effect of a
demand-side energy management pilot implementation on the management and control of residential
How It Works - Why It works
TREE provides utilities with a centralized platform that is capable of aggregating and receiving data from
many thousands of end points. This unprecedented visibility into consumer behavior patterns gives utilities
the information they need to collaborate with their customers to better manage overall demand.
In addition, that same real-time consumption information is provided directly to consumers giving them -
for the first time ever - control over their utility bills and the ability to make smart choices about their
TREE delivers several key benefits to consumers and energy providers including:
•   Visibility into how energy is being consumed.
The Tendril Insight in-home display and Tendril Vantage portal provide consumers with near real-
time basic consumption and cost information, an estimated monthly bill, as well as utility pricing
and messages. Early evidence from in-home display usage alone indicates that giving consumers
real-time visibility into their energy consumption decreases usage by as much as 20%. (refer to
&quot;The Power of Experimentation: New Evidence on Residential Demand Response,&quot;
www.brattle.com).
•   Consumer education and engagement. The Tendril Vantage browser-based Web portal was
designed to provide consumers with the simple tools and information they need to better
understand, manage, and control their energy consumption. The information gathered by Vantage
also allows energy providers to conduct meaningful analysis on a device-by-device level
•    Customer Control - Utility Intelligence.
Tendril&#39;s demand response (DR) solution takes a different approach to traditional DR programs by
empowering the consumer as part of the program. With Tendril DR, consumers can control
consumption in response to peak demand periods and variations in electricity prices. They can
Redacted Version                                               2
TE.l\rDRIL                                                                          Petitioner&#39;s Exhibit JMS-R4
Srnc:rt Energy for Life                                                                          Cause No. 43623
Page 5 of34
program load control devices, including programmable thermostats and smart outlets, to
automatically respond to electricity events and opt out of events at the device-level.
Tendril DR gives utilities verifiable control and unprecedented levels of visibility into how their
customer&#39;s are responding to variable price and demand response events. Utilities can gather data
on how each device is programmed to respond and historical information on how each device
responded during past events, including every customer initiated override (opt-out).
Using Tendril&#39;s DR Application Module (or DRLC API to interface to a third-party demand
response application), utilities can engage their customers in incentive-based demand response
programs that allow the utility to control residential energy consumption during peak demand
periods for grid reliability and economic efficiencies. TREE gives utilities real-time visibility into
expected device response, effective load shed, and customer override audit trails.
TREE makes energy management a partnership between energy providers and their customers. The near
real-time consumption information provided directly to consumers empowers them to gain control over
their utility bill by giving them the feedback they need to make smart choices about their energy
consumption. Energy providers get unprecedented access and (customer opt-in) control for working with
their consumers to better manage overall demand. The flexibility and extensibility inherent to TREE&#39;s open
platform enables utilities to execute pilots that effectively explore how consumers respond to various
aspects and configurations on energy efficiency and demand response components to better understand
their consumer base and inform effective and efficient planning oflarger scale future rollouts.
f&quot;,&#183;
Redacted Version                                                3
Page 6of34
TREE - Solution Overview
The Tendril Residential Energy Ecosystem (TREE) is a turnkey solution for utilities and energy providers
to implement consumer communication functionality in their service area. TREE works with a consumer&#39;s
meter (AMI smart meter or AMR meter via TREE AMR-Gate), home computer, and Internet connectivity
to create a network of information in the home.
Please note: For IPL&#39;s pilot, the ERT to ZigBee component will be replaced with the Tendril AMR Meter Bridge to provide the CTO to ZigBec communications bridge,
At the heart of TREE is our TREE platform an open, enterprise-class demand side energy management
software solution for utilities and energy retailers. Designed to support multiple energy management
applications simultaneously, including Energy Efficiency, Demand Response, and Pricing, TREE is
scalable, unified, and optimized for seamless integration with the utility back-office, a variety ofmeter
networks, and ZigBee&#174;-enabled Smart Energy (SE) devices.
The TREE platform is the first unified energy management platform with an open, standards-based
architecture that can scale to support millions ofhomes and their SE devices. The platform&#39;s open
application programmer interfaces (APIs) allows for seamless integration with new user applications and
existing back-office enterprise systems, including meter management and billing systems, as well as load-
monitoring and security applications.
The TREE platform can be accessed by consumers in a variety of ways including, the Tendril Vantage
consumer portal, mobile devices, smart thermostats, and smart in-home displays (including Tendril
Insight). These devices provide access and information about the other devices in the Home Area Network
(HAN) as well as details on their energy consumption and billing information.
The Vantage Utility Management Center provides energy retailers with the ability to monitor and manage
millions of HANS simultaneously, and communicate directly with their customers regarding service and
support in real-time.
Tendril has architected the TREE environment to conform with the demanding security standards expected
and required by the Utility industry and emerging Smart Grid. Core elements of TREEs security
Redacted Version                                                                                  4
Smart Energy For Life                                                                        Cause No. 43623
Support of ZigBee Network and Transport layer AES 128-bit encryption for all communications
within the Home Area Network.
Support of ZigBee Smart Energy Application Profile ECC secure key exchange standard for
authorization of devices joining/fonning the home area network of energy management devices.
Use of proprietary binary RPC communication protocol between the Tendril Transport Broadband
Gateway in the Home Area Network and the TREE server wrapped in SSL using Stunnel on both
the client and server connections.
Use ofSAML for single-sign-on authorization access to TREE applications (i.e. Vantage Portal)
Use ofHTTPS for communication between the consumer web browser and the Vantage Web
Portal; and for the transfer oflog and finnware files to/from the HAN.
Use ofSFTP for file transfer between the TREE environment and Utility back-office servers.
Each Utility customer is given a segregated and dedicated server and network infrastructure within
the TREE network operations hosting center to ensure the privacy and security of each utilitys
communications and data.
Redacted Version                                             5
TEJ\,rDRIL                                                                                                                           Petitioner&#39;s Exhibit JMS-R4
Smart Energy For Life                                                                                                                             Cause No. 43623
In addition to the TREE Platform. the ecosystem includes the following components:
•    Tendril Vantage is a consumer-facing Web portal that displays information to help consumers
better understand, manage, and control the energy consumption in their home.
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BIlling Period Usage: I 1386.13 kWh                  Usage Today:     I   80.53 kWh
7 Day Forilcast
Current Bill To Oat.: [ 5138.82                       Co.t Today: L[_58_.0_6_----,
•      Tendril Insight is a Zigbee-enabled in-home display that reads consumption information directly
from an AMI smart meter or from an AMR. meter via the Tendril Translate meter bridge. Insight
provides near real-time feedback on household consumption as well as proactive notification
settings to alert consumers when key conditions occur, such as reaching a specified monthly bill
amount or consumption level, or a change in effective pricing. In addition, Insight receives and
displays messages from the utility with regard to demand response or other critical events.
•       Tendril Transport gateway serves as the ZigBee to IP translator, providing the connectivity
between the network of smart energy devices in the consumer&#39;s home and the TREE server, via
the Internet: Transport connects to the home user&#39;s IP router (DSL or Cable modem), providing
two-way connectivity between the participating customer and their energy partner.
•       Tendril Translate is a meter bridge that allows consumers and utilities to leverage their existing
AMR meter investments while delivering consumers and utilities the information and control
typically associated with &quot;Smart &quot;Grid&quot; implementations. Tendril Translate creates the Cellnet
Transmit-Only (CTO)-to_ZigBee bridge, receiving the CTO signal from an AMR meter and
translating it into ZigBee for presentation to the consumer and the utility via the home area
The Tendril Translate bridge captures the CTO 900 Mhz signal whenever it is transmitted by the
Redacted Version                                                                             6   .;
TE..i\rDR1L                                                                                                           Petitioner&#39;s Exhibit JMS-R4
Smart Energy For Life                                                                                                              Cause No. 43623
meter. This signal is then immediately available to all devices in the HAN that are capable of
presenting, storing or acting on this data, such as the Tendril Insight In-Home-Display or the the
Tendril Transport Gateway.
To maxllnize scalability, the TREE server captures a time-stamped meter read from each Home
Area Network every 15 minutes. This data is then stored in the TREE database and is available
for a variety of purposes including presentation in the Tendril Vantage web portal, management
and representation of historical usage, time-of-use and CPP billing purposes and for use in
analyzing and reporting on customer usage patterns and responses to utility initiated events such
as variable pricing and load control.
•       Tendril Volt is a 110VAC 3-prong, ZigBee-enabled electrical outlet that can be plugged into a
standard wall outlet to demonstrate load control and analyze consumer response to utility-
generated demand response events. Volt supports user-overrides (opt-outs) and supports the future
TREE functionality of disaggregated consumption information and control.
•       Tendril SetPoint is the Tendril ZigBee Smart Energy compliant OEM Smart Energy Thermostat.
The SetPoint is wired to a traditional HVAC unit providing consumers control over the largest
energy consumer in the home. SetPoint provides a mechanism for demonstrating load control and
analyzing consumer response to utility-generated demand response events. SetPoint provides
consumer control via demand response opt-outs and supports the future TREE functionality of
customer remote control.
Tendril understands that consumer choice is important to our utility partners. Our platform is built on an
open standard, which facilitates the development and integration of third-party devices into TREE to give
utilities the opportunity to enhance and evolve the choices they offer their consumers over time. We are
currently working with two third-party programmable thermostat vendors, a third-party llID vendor, and a
third-party load control switch to augment the native Tendril products as part of the TREE solution
TREE allows IPL to get near-real time energy consumption data from their AMR meters, establish demand
response and direct load control programs to manage residential energy demand; implement time-of-use,
critical peak and other dynamic pricing programs; and promote energy efficiency by enabling their
customers with tools for real-time energy management. Because the entire TREE system is also designed to
support a two-way communicating advanced metering infrastructure (AMI), IPL can seamlessly migrate
the solution and its customers to AMI, at the time and pace deemed most appropriate.
Redacted Version                                                                      7
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Smart: Energy for Life                                                                          Cause No. 43623
Proposed Pilot Implementation
We understand that IPL desires to gain near real-time visibility into customer behavior to validate and
analyze responses to a variety of energy efficiency and demand response interactions. TREE&#39;s integrated
solution, which combines broadband, ZigBee, and eTO communications technologies, allows IPL to
levemge its existing AMR infrastructure and build a framework for the following:
• Establish demand response and direct load control programs to manage residential energy demand.
• Implement time-of-use, critical peak and other dynamic pricing programs.
• Promote energy efficiency by enabling their customers with tools for real-time energy information
IPL has expressed interest in defining a proof-of-concept pilot program to include residential customers and
at a volume that can provide robust information on consumer behavior/response given technology and
utility generated events such as variable pricing. To meet these objectives and accommodate IPLs
proposed budget, Tendril is proposing a 150 home pilot. Tendril&#39;s proposed approach segments the pilot
base into implementation groups to understand how different solution configurations elicit various
interactions and responses.
The high-level scope, approach and estimated costs of the proposed pilot are described below. Following
agreement on the pilot objectives and proposal scope, Tendril will develop a project plan and statement of
Based on our experience with other utilities, Tendril proposes a two-phase implementation approach that
includes a combination of home configurations for the consumer and a series of reporting and analysis
milestones. This phased implementation and deployment will enable IPL to incrementally test, adapt, and
integrate the TREE offering as the pilot progresses. A phased approach also allows for measured
adjustments to project approach and scope, if necessary, to ensure overall program goals are met. Tendril&#39;s
engagement services team will work closely with IPL during the entire duration of the pilot.
Phase 1: Lab testing and pilot planning
This phase is an initial, small volume (ten or fewer) installation designed to test system infrastructure,
evaluate back-office integration approaches, and exercise inter-organizational support and communication
channels between IPL and Tendril. This phase allows the project teams to test procedures designed to
support the rollout to the larger I 50-home pilot in Phase 2. This initial phase typically lasts between thirty
and sixty days and provides key data points for effectively planning subsequent pilots.
On execution of the Statement of Work, Tendril will provide a dedicated Engagement Manager to manage
all facets of the implementation and engagement. The EngagementManager will work with IPL throughout
Phase 1, including on-site planning and review sessions, to facilitate the lab implementation and begin
planning the Phase 2 rollout.
Redacted Version                                                8
TE.J\rOF=iIL                                                                         Petitioner&#39;s Exhibit JMS-R4
Sm;:: 1&#39;1&quot; Energ-y For life                                                                       Cause No. 43623
The delivery outputs of Phase 1 include:
I.   A set ofTREE kits installed in a lab environment on-site at IPL for initial technical evaluation.
These kits will have the same component configuration as the kits to be used in the pilot rollout.
Tendril recommends setting up a kit to reflect each configuration option that will go into the field
2.   Phase 2 implementation strategy including back-office integration, rollout, and Tendril services
support for IPL. This strategy will include defining the analytics approach to meet IPL&#39;s specific
goals for the pilot. IfIPL chooses to use Tendril&#39;s turnkey installation services solution, we will
engage our services partner, GoodCents, during this stage to execute the planning ofthose
Phase 2: Pilot field rollout
Phase 2 of the pilot moves into field deployment with 150 in-home installations plus a 50-home control
group. This phase allows IPL to exercise the full functionality of the TREE and analyze the impact of
various home configurations on consumer responsiveness. In addition to proving out the TREE solution,
Phase 2 will provide IPL with real-world consumer feedback, energy usage, and demand response behavior
data. In this phase, IPL back-office systems processes and data are integrated with the consumer experience
and with TREE.
Proposed home configuration options to analyze consumer behavior
The overarching goal of the pilot is to demonstrate solution viability and identify the components that will
be most effective in meeting IPL&#39;s requirements for demand reduction and energy efficiency targets.
Tendril&#39;s engagement services team will work with IPL to segment the pilot participant base and ensure an
effective representation of socio-economic profiles. In addition, Tendril recommends establishing a control
group to provide a baseline for analysis ofresults by piiot grouping.
As needed, TREE will provide IPL remote upgrades of devices, facilitating the ability to introduce updates
and enhancements to the devices, as they become available throughout the duration of the pilot. Appendix
A outlines the proposed pilot segmentation.
The delivery of TREE components to homes can be facilitated several ways, including shipping kits
directly to customers, via Tendril-provided resources, IPL personnel, or through a third-party installation
service. Per IPLs request, this proposal includes an option for the provision of turnkey installation, and
customer support services. These services will be provided under sub-contract by our implementation
services partner, GoodCents. Details of these turnkey services offering are available upon request from
Products are delivered in Tendril-branded kits with accompanying documentation to ensure participants&#39; a
straightforward and successful out-of-the-box experience. Delivery is coordinated with back-office data
integration to ensure the kits are joined and registered smoothly and that the consumer is ready to use the
solution out of the box.
Tendril Engagement Management will work with IPL, either remotely or on-site, to establish the back-
office system integration and to manage the pilot rollout against that project plan created in phase 1.
Additional services provided in this phase are designed to ensure that user engagement with the solution
Redacted Version                                               9
TEl\rDR1L                                                                               Petitioner&#39;s Exhibit JMS-R4
Smart Energy For Life                                                                                Cause No. 43623
supports IPL&#39;s overall objectives for the pilot. IPL will be expected to provide a technical point of contact
to Tendril for facilitating, defining, and any the integration from IPL&#39;s perspective.
Understanding the impact of day-to-day changes is key to long-term user adoption of an energy
management solution. Through customized energy usage update reports delivered daily by email,
consumers can view a breakdown oftheir consumption against their own patterns of use, as well as against
the consumption rates of similar households, to more effectively gauge their own usage. Tendril will work
with IPL to defme appropriate benchmark data points for relative consumption comparison within the pilot
as well as against controls. This benchmarking data provides key data points for modifying and enhancing
program offerings to meet IPL&#39;s objectives.
TREE also includes access to existing education materials to help consumers understand how to use TREE
to effectively meet their goals. Throughout the pilot, Tendril&#39;s education team will work with IPL to
identify aspects that can be enhanced with additional material to support the consumer experience and
ensure the solution is implemented and used in a way that meets expectations.
Phase 2 Assumptions and Outputs
Phase 2 involves a staged rollout ofboth back-office integration and households. Tendril and IPL will
work together to develop an in-depth project plan based on overall scope and objectives. Tendril will
require dedicated resources from IPL to define and test the back-office integration to ensure a seamless and
accurate consumer experience. Tendril assumes that support for the in-field deployed scope of this pilot
will not exceed 8 months.
Delivery outputs for Phase 2 of the pilot are as follows:
1. Support and supply for the rollout and implementation of 150 kits into homes previously identified
by IPL. This proposal assumes that. of the pilot participants will install their in-home kits
themselves (those without llIDs or peTs); And the remaining. homes will utilize the proposed
2. An effective level ofback-office integration of user, energy prices and programs, cost and
consumption (historical and projected), and interval consumption data. This integration allows
various features within the system to function, including:
• Providing the premise and meter information needed to accommodate the commissioning
• Allowing billing and program information to be shared between IPL back-office systems and
the Insight in-home display.
3. Usage and data reports. Based on the discovery and requirements process conducted in Phase 1,
Tendril will deliver reports specifically designed to address the measurement and validation
objectives ofthe pilot These reports could include:
• Baseline comparison reports
• Daily trend reporting, time of day usage
• Customized reports sent directly to participants via email
• Reporting against configuration segmentation and control group to analyze variances in
consumer behavior across control groups.
4. A full report and analysis at the end of the Pilot mapping stated IPL goals to metrics and overall
5. Results of an online consumer survey designed by our education and user experience team
targeted at before- and after-pilot behavior.
Phase 2 will provide IPL with real-world consumer feedback, energy usage behavior data, and granular                 : .
Redacted Version                                         10
....   _-_   -.-      __ _-
.      _--._-_   _-
..•.   _--- __._-
.        __._-_._..-._------_.._-..__.._--_   .
TE~l\.rDRIL                                                                                              Petitioner&#39;s Exhibit JMS-R4
Smart Energy For Life                                                                                                 Cause No. 43623
consumption information. The work done to accommodate the planning for this phase can be used as a
foundation for future phases of a large-scale implementation.
The pricing includes over-the-air updates of the home area networks (HANs) to provide consumers with
updated software and product firmware released during the duration of the pilot.
This proposal does not constitute a statement of work. Upon acceptance ofthe proposal, Tendril will
deliver a statement of work defining the exact deliverables and terms of the agreement. Tendril requires a
portion of the fees below upon execution of the statement of work.
Total cost for Pilot                                                                                       $240,375
Hardware                                                                                                                                      i&#183;
1.   The price of the HAN hardware reflects the low volumes of the pilot. Unit prices are lower for
2.    Tendril will be continuing to add support for additional third-party HAN devices (e.g., PCTs and
load control switches). Tendril will communicate the availability ofthese devices, as applicable,
during the duration of the pilot.
3.    Cost includes a one-year warranty on all devices.
4.    Tendril will host the TREE pilot implementation for IPL. The Hosted Pilot Subscription License
Fee is a flat fee for volumes under 1,000 homes. Over 1,000 homes, this fee becomes a per HAN
1-&#183;,:
Redacted Version                                                        II     .;
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Smart Energy For Life                                                                            Cause No. 43623
(home) subscription fee ranging from            per year with volume and depending on the types
of software modules required. Fees cover setting up a unique TREE instance and infrastructure for
the IPL pilot, 8 months ofhosted services for the specified number of Rome Area Network
accounts, 8 months of tier 2 technical support (24 x 7 for severity 1 issues) technical support for
the service period, provisioning and administration of all users on the system, and 8 months of
software maintenance including all bug fixes, updates, and upgrades as released by Tendril. This
Pilot System license includes the Base Platform, the Energy Efficiency Application Module,
which includes the Tendril Vantage Consumer Portal and Vantage Utility Management Center, as
well as the Demand Response Application Module.
5.   Tendril assumes participation in project management, installation, back-office integration, end
user training, and general support activities to support this pilot. An initial estimate of the base set
of expected services is included in the cost structure. Travel and living expenses will be in
addition to the quoted proposal costs. Scope of services included in this proposal are as follows:
• Engagement Management including a dedicated client engagement manager to provide
strategic and tactical planning support to IPL for the Pilot; project management; and
request, issue, and risk management and resolution.
• Education Services including product and technical training for IPL staff responsible for
the planning and execution of the pilot; Tier 1 customer support training; and end-user
• Integration Support and Services to define, implement, and test integrations between
TREE and IPL back-office systems for user, pricing, and historical, projected, and current
consumption information reconciliation.
• Turnkey Installation Services - Tendrils implementation partner, GoodCents, will
install a HAN gateway, one programmable communicating thermostat and ancillary
devices such as an in home display or repeater for a fee o f . per home. This fee
•    Appointment scheduling
•    Installation labor and device registration
•    Travel expenses
•    Call center support
Additional thermostats will be installed as necessary for a fee o f . each.
Additional fees will be incurred if the pilot period must be extended due to pilot program
participants who cannot be scheduled within the planned three week installation window.
Tendril will provide names and contact information for customer references from Reliant Energy and
NSTAR upon request.
Appendix A: Pilot Segmentation
Redacted Version                                                12
TElvDRIL                                                    Petitioner&#39;s Exhibit JMS-R4
Srr;(ln: Energy For Life                                                 Cause No. 43623
No change to existing IPL       Baseline measurements captured
configuration                   at regular intervals to identify
behaviors affected by events
outside of TREE (price signals
sent through traditional means
(i.e. phone, e-mail), unusual
weather patterns, high-profile
news events, etc.)
Information plus      •    Variable pricing           Measures consumer response to
variable pricing      •    Vantage consumer portal    real-time consumption data,
program without In-   •    Transport Gateway          benchmarking, user-defmed
home display          •    Tendril AMR Meter Bridge   alerts and optional variable
pricing without access to in-home
Information plus       •    Variable pricing           Measures consumer response to
variable pricing       •    Insight In-home Display    real-time consumption data,
program with In-home   •    Vantage consumer portal    benchmarking, user-defmed
display                •    Transport Gateway          alerts and optional variable
•    Tendril AMR Meter Bridge   pricing with access to in-home
dis la
Demand response with   •   Utility DRLC Portal         Measures aggregate and per HAN
Programmable           •   Vantage consumer portal     load reduction, and provides
Thermostat; without    •   Transport Gateway           analysis ofparticipation in
in-home display        •   Tendril AMR Meter Bridge    demand response events
•   SetPoint Thermostat
Programmable           •   Insight In-home Display     load reduction, and provides
Thermostat and in-     •   Vantage consumer portal     analysis of participation in
home display           •   Transport Gateway           demand response events
•   Tendril AMR Meter Bridge
Redacted Version                                       13
TE...\ rORIL                                                              Petitioner&#39;s Exhibit JMS-R4
Sma!1: EnergY&#39; For Life                                                                Cause No. 43623
IN WITNESS WHEREOF, pending review and signature of the associated contracts and other legal
documents, both parties agree that it is their intention to enter into a business arrangement based
on the provisions outlined in this proposal. By signature and initialization of this document,
their duly authorized representatives acknowledge their intent to work in good faith towards a
legally binding arrangement and each represents and warrants to the other that they are legally
TENDRIL NETWORKS, INC.                           INDIANAPOLIS POWER &amp; LIGHT
By:                                        _     By:                                     _
Name:                                  _         Name:
Title:                                     _     Title:                              _
Date:                                      _     Date:                               _
Redacted Version                                        14
!,&#39;
TENDRIL RESPONSES                                                   Petitioner&#39;s Exhibit JMS-R4
r&#39;2s
r;Jp~ny      Additional Home Area Network Information
Upon review of the responses to IPL&#39;s request for Information related to Home Area Network
Proof of Concept (HAN POC), our internal review team has comprised succinct evaluation
criteria and some the additional questions listed below.
Key Functions of RAN, as listed in the original RFI, include:
• Successfully intercept AMR signal, convert it to Zigbee and interface to in-home display
and a programmable communicating thermostat (PCT)
• Collect energy usage on a 15 minute interval basis using AMR meters and communicate
billing quality information to IPL for purposes of implementing Time of Use rate ofup to
4 &quot;buckets&quot; or pricing periods through a customer broadband connection
• Enable remote demand response (DR) capabilities through IPL&#39;s control of thermostat
• Present &quot;near real time&quot; energy information to end-use customers through a web-based
application. &quot;
• Provide IPL access to end-use customer near real time data for analysis and measurement
and verification of DR
IPL will evaluate the proposals based upon the following 14 criteria. Some additional questions
are listed for specific components. Please provide additional information or the appropriate
reference to your proposal for this information.
a) Does the system accomplish key functions?
b) How does the RAN manage time clock synchronization? That is, will the HAN
equipment clock and meter clock be synchronized?
The RAN (portals and devices) pulls date and time from the TREE server. The
HAN does not currently synchronize with the meter on time but we will support
c) Will the RAN software include bill estimation functionality to display &#39;&#39;month-to-
date&quot; estimates at the in-home display?
YES, in the IHD and the Vantage Web Portal.
d) What are the minimum broadband requirements for participating customers?
Cable or ADSL Broadband service and modem/router with an available Ethernet
Page 1 of8                              June 2009
e) Please describe the capability of the equipment to store data or otherwf~A~gRfe34
the loss of a broadband connection to successfully transmit billing data, including
the maximum storage time period.
There is a significant amount of data storage available on the Tendril Translate
bridge device. Typically, we are able to store 2 to 6 months of data depending on
the frequency of reads. However, Tendril has not yet developed the filTIlware to
store the interval/profile data on the bridge. This feature is planned for release by
endof2009.
f) Please provide technical specification sheets including a picture, estimated power
consumption to operate each AC-powered device, expected equipment life and
dimensions ofthe product(s) if available.
The latest specifications are available on our web site at:
http://www.tendri1inc.com/consumers/products/
2. System Data Accessibility
How often, in what file fOlTIlat, and through what means willIS minute and aggregate
data be available to IPL?
Data is retrieved from the HAN to the TREE server every 15 minutes. It is stored in the
TREE database and timestamped with the consumption value captured at each 15 minute
read. The file fOlTIlat is a .CSV or XML fOlTIlat. We can provide samples upon request.
3. Data Security and Interoperability
Please describe the status of the HAN security and interoperability compared to pertinent
proposed standards proposed by the DOE in its May 18, 2009, press release.
AMI-SEC System Security Requirements
Tendril is a regular participant in AMI-SEC task force teleconference calls and face-to-face
meetings. As such, Tendril is familiar with the output products ofthe AMI-SEC task force,
including the AMI Systems Security Requirements document. Relevant requirements are                   &quot;,
considered throughout the engineering lifecycle including Architecture, Implementation, and
Tendril recognizes IEC 61968 Common InfolTIlation Model and IEC 61970 Generic Interface
Definition (GID) as being key standards for ensuring interoperability between smart grid IT
systems. The TREE 1.6 p1atfolTIl implements internal APIs based on the Common InfolTIlation
Model (CIM) supporting MeterReading (IEC 61968-9 (MR) Meter Reading &amp; Control). Tendril
plans to continue to adopt and support CIM and GID as the TREE p1atfolTIl evolves.
Cyber security standards and guidelines for federal infolTIlation systems
Tendril is currently in the confolTIlance assessment phase of adopting and implementing the
SP800-53 standard. Tendril has engaged a third-party IT security finn to provide an objective
confolTIlance assessment and to provide experienced guidance towards adoption. Estimation of
Page 2 of8                              June 2009
TENDRIL RESPONSES                                                    Petitioner&#39;s Exhibit JMS-R4
conformance timeline is TBD.
The Open ADR standard outlines specific communication models that use the Internet to send
DR signals to end-use customer systems. As the Open ADR standard emerged, Tendril worked
with Electric Power Research Institute to adopt the standard and achieve the first Open ADR
Tendril was an early participant in the OpenHAN task force. To date, Tendril continues to
support the OpenHAN taskforce and regularly references the identified Use Cases for inclusion
in the TREE product.
ZigBeellIomePlug Smart Energy Profile
Tendril is a long-standing participant in the ZigBee Alliance and is committed to the
advancement of ZigBee as the protocol that will foster increased adoption of low-power wireless
networks and the acceleration of the technology. Tendril has an aggressive partner program
dedicated to supporting a large ecosystem of 3rd party HAN devices that leverage ZigBee Smart
Energy Profile interoperability. Tendril&#39;s on-going HAN device strategy is to broaden and
extend the Tendril TREE offerings primarily through third party partnerships, leveraging open
standard interoperability for rapid assimilation and integration.
4. Implementation Cost
a) What costs (if any) is the vendor assuming that lPL will incur in addition to
vendor costs (e.g., marketing, M&amp;V, internal IT resource costs)?
This is highly dependent upon how lPL plans to rollout the pilot. There will
likely be some marketing costs; IT resource costs will be dependent on the
amount ofback-office integration that will be required to effectively ingest the
interval data from the TREE format into the format required for lPLs billing
systems. There will also be some IT resource required to assist in initial setup of
customer information and transfer of data from the IPL CIS (CAS ?) into TREE to
associate the meter and address ofrecord to the HAN equipment as well as
coordinate updates to billing data.
b) What is the estimated cost to integrate compatible data for Customer Accounting
System (&quot;CAS&quot;)?
This is highly dependent on the structure/requirements of CAS and cannot be
accurately assessed without more details on the current CAS
application/environment. Tendril has included an estimate of these costs in its
initial RFI response.
c) What is the average cost per home?
Page 3 of8                               June 2009
TENDRIL RESPONSES                                                Petitioner&#39;s Exhibit JMS-R4
The average cost per home for the proposed pilot including all hardwJl,~t&amp;vRf~4
and services is about _ . However, the cost per homereduces significantly
with the volume of deployment. A target average cost per home for a HAN
environment with all device components is in the range o f _ .
5. Feasibility and Project Planning
a) Please describe the number ofFTEs, technical skills set(s) and availability of
skilled staff to implement this project for IPL including a breakdown of company
employees and any subcontractors.
Tendril provides a dedicated client engagement team to manage and support its
client relationships. This team provides a focused and responsive channel for
managing all facets ofthe engagement, including delivery and installations,
program management, custom integration and development work, support and
professional services engagements, and issue escalation and resolution. This
engagement team works with functional leads throughout the organization to
ensure timely and effective execution of all facets of the program. A typical
engagement such as the one defined in the IPL RFI has five dedicated resources,
led and coordinated by a client engagement manager. Tendril uses a third-party
partner to manage deployment services, including installation and tier 1 support.
Our partner provides a dedicated project manager that works with our client
engagement manager and support lead to ensure coordinated delivery,
deployment, and support. These resources are in-place and available as needed
b) Please provide the resume ofthe expected project manager for this initiative.
c) Is the company willing to approach project planning collaboratively with IPL and
d) What is the expected deployment timeframe?
Expect 2-3 months for system setup/implementation, customer recruitment and
project planning and 1 month for deployment/installation.
e) Please define expected IPL resources needed for deployment and system
Tendril requires a dedicated program manger at IPL to facilitate information
gathering and project implementation. This PM works directly with Tendril&#39;s
client engagement manager to facilitate communications. In addition, Tendril
expects access to technical expertise to facilitate lab evaluations and to provide
implementation and integration requirements and testing.
Does the system accommodate additional customer equipment from either the vendor or
other third party vendors? Please describe.
Page 4 of8                              June 2009
TENDRIL RESPONSES                                                  Petitioner&#39;s Exhibit JMS-R4
Yes. Tendril will be adding a load control switch device by August 2009 an!~:M of 34
one and possibly two additional thermostats by September 2009. Weare also actively
working with third party vendors on additionallliD and white goods appliance options.
a) Please describe the reliability expectations ofthe HAN system hardware and
Tendril can provide for a 99.5% uptime SLA for TREE in a hosted solution. We
do not currently provide an SLA for the HAN system hardware.
b) What is the communication success rate, (1) between the In home display and
internet portal from AMR meter gateway, and (2) from the home broadband
connection to IPL?
These statistics are still be compiled and will be provided as soon as they are
c) Please describe contingency plans for system backup and emergency system
restoration from the perspective of a hosted solution option.
Tendril performs system level backups on a daily basis with a retention of 4
weeks. We also perform hourly database backups that are retained for 30 days. A
copy of all hourly database backups are additionally kept offsite within Amazon&#39;s
EC2/S3 infrastructure. In the case of the corruption or loss of a single server
instance Tendril is able to restore operations within 4 hours. In the event ofthe
complete loss of Tendrils primary datacenter operations will be shifted to
Amazon&#39;s EC2 infrastructure. Please see the attached copy of Tendril&#39;s disaster
recovery plan for details.
8. Number of Homes Included in test
150 proposed based on IPL&#39;s current budget.
9. Test Plan Robustness
10. Proven HAN Experience
a) Please provide the locations by utility service territory and volumes of HAN
b) Please provide an estimate of committed HAN deployments &quot;in the pipeline&quot;
including the number of utilities and customers
11. Intuitive User &quot;Friendliness&quot;
Please describe/provide any market research/customer focus group results that you have
outlining the customer response to the portal, lliD and PCT releases that will be deployed   ;~
atIPL                                                                                        !
See attached .pdf document documenting some recent consumer research results.                I
;.&#39;
12. Inclusion of User and Administrator Education/Training
Page 5 of8                               June 2009
Please describe the IPL customer and lPL staff education and training that is !;.~tlfetM of 34
with your proposal
Tendril provides end user education materials, including quick start guides and user
documentation, which can be customized and rebranded by lPL as required.
In addition to core solution training to educate lPL staff and stakeholders, Tendril has a
tier 1 train-the-trainer program, if required to educate lPL customer support centers.
13. Ability for HAN equipment to migrate to AMI
Tendril&#39;s solution is designed to support Landis &amp; Gyrs Gridstream AMI environment
and provide a seamless migration into the Gridstream solution. All equipment installed
in the AMR environment will be compatible with the Gridstream environment except for
the AMR Translate bridge which will be unnecessary once two-way ZigBee Smart
Energy enabled meters have been implemented.
While our plan is to be able to support every ZigBee Smart Energy compliant AMI, our
work to date has been with Itron, Landis &amp; Gyr and Sliver Spring networks. We have
not performed any integration with Elster to date, although we have discussed this with
Elster and both parties are open to doing this when the right business opportunity is
presented. So, in addition to the three I mentioned that we are supporting today, we can
support other ZigBee Smart Energy compliant systems, but would need to do some
interface work at their head-end (as we have done with the initial three) to ensure we can
communicate end-to-end over their AMI communications infrastructure.
14. Administrative and Contracting
a) Please describe any follow-up equipment purchase commitments required oflPL
assuming a successful pilot
The only anticipated additional equipment purchase commitments will be those
associated with rolling out more customers/homes with the HAN solution.                     ;   .
b) Is the Company willing to accept penalties for non-performance?                             !
Tendril is open to SLAs with appropriate commitment levels from lPL.
c) Please describe the company&#39;s dispute resolution process.
Tendril always strives to work with and accommodate our customers. In the
unlikely event of a dispute that is unable to be resolved as a matter of standard
vendor/customer relations and negotiations, Tendril is open to working with a
third party arbitration specialist.
Page 6 of8                                June 2009
TENDRil.- RESPONSES                                                  Petitioner&#39;s Exhibit JMS-R4
Tendril Specific Questions
1. Please explain the numbers of homes in each group. (See page 9 - reference to 50 in
control group plus 150, but only 150 is shown with cost information on page 11.)
The 50 is a control group with no Tendril equipment, software or service; so there is no
fee associated with these homes. The rest ofthe groups are just broken up in a manner
suggested by Tendril based on lPL&#39;s primary objectives. But lPL can choose to segment
any way they would like.
2. Please provide details about turnkey services referenced on page 9.
See attached GoodCents overview.
3. Can TOU billing data be moved to the first task ofphase 2? IPL prefers to verify this
functionality prior to installing all of the HAN equipment.
TOU can be moved to whenever lPL wants to validate the data coming from the meters;
it can be in Phase 1 or Phase 2.
4. How does Tendril plan to acquire customers? Will this be through random offerings?
This is highly dependent upon IPL&#39;s preference for who and where customers are to be
acquired. We plan to consult with you on this to determine the best approach to
customer enrollment.
5. Please provide the cost ofthe Tendril Volt plug based upon a quantity of 50.
At quantity 50, the price of the Tendril Volt device is • .
6. What are the incremental costs to expand the data collection period to include a fulll2
An additional_ for the Hosted TREE services.
7. At the top of page 7 you reference the Tendril Translate bridge functionality, including
data storage. If the broadband is down at a customer&#39;s home, how much (if any) storage
capability is contained in the bridge device?
There is a significant amount of data storage available on the bridge device. Typically,
we are able to store 2 to 6 months of data depending on the frequency of reads. However,
Tendril has not yet developed the firmware to store the interval/profile data on the bridge.
This feature is planned for release by end of2009.
8. Page 10, Phase II, item 2 references sharing of data between IPL back-office systems and
the insight IHD - what is the standard frequency of communication between the IHD and
the lPL back office? Is it an &quot;inquiry only&quot; sharing? Ifnot, what is the frequency of data
transfer?                                                                                       :.
Page 7 of8                               June 2009
TENDRIL RESPONSES                                                 Petitioner&#39;s Exhibit JMS-R4
This data sharing is specifically to update the customers billing data with one-time and
other ancillary charges that are added on top ofthe consumption fees; the frequency in
which these updates occur is completely up to IPL. We are currently providing nightly
updates for one of our customers; but it could be nightly, weekly or any frequency that
IPL prefers.
9. Page 10 references Usage and data reports - please provide IPL with an example ofthese
reports (or provide at time of on-site IPL demo)
Most of these reports are currently being developed for a couple of our summer 2009
pilot projects. Samples will be provided to IPL as they are available. A sample
usage/data report will be reviewed at the June 4 meeting.
10. Page 11 items 4 and 5 - please provide examples of reports referenced in these items
and/or an outline of content of such reports.
No examples of these reports are yet available. Expect availability by end of Q3 2009.
Page 8 of8                               June 2009
into what&#39;s   &quot;,&#39;&#39;&#39;&#39;b6&#39;U&#39;&quot;,    This smart outlet measures and transmits the energy usage of any attached
device or appliance.
It&#39;s shocking. How much energy even idle electronic devices use. Find out what&#39;s responsible for &quot;vampire&quot;
current and how much they are costing you.
Volt is a 3-prong, ZigBee&#174; enabled electrical outlet that can be plugged into a standard wall
outlet to monitor the energy efficiency of any electrical appliance or device. When used in conjunction
with Tendril Insight or Tendril Vantage, multiple outlets in the same home can be tracked individually
or as a group over ttle Internet giving the consumer unprecedented insight into and control over their
household energy footprint.
• A ZigBee enableci device that measures and controls           • Works in conjunction with your local electricit.y provider&#39;S
the energy consurnption of standarci [lOme electrical            smart energy program to help conserve power and save
appliances or devices.                                           you money.
• Gives the consumer unprecedent.ed insiglit. into and          • Provides control over &quot;vampire &#39;. current t.hat some
control over their household energy foot.print. improving        home devices draw when off ancl thus saves energy 21nd
tlleir overall energy efficiency.                                money.
C&#39;:HGLHIJ&#39;&#39;&#39;CC;-&#39;        f~~H~W~fr&#39;s Exhibit JMS-R4
&gt;  Cause No. 43623
d                                   nsumers and        lities to create                                         Page 26 of34
TREE is a st.andards based
Residential Energy Managemei1,
Syst.em (REMS) that connects ut.ility
back ofFice syst.ems wit.h smart
energy devices in t.he horne, With
TREE, utilit.ies have an extensible
platform From which they can
engage their customers in energy
saving programs that. help 111anage
peak loads and improve the overall
consumer experience, Unlike one
IH&#183;HOM~ Dl~h&quot;&quot;   ~~rH; It&#163;Flilf&#39;
way, int.rusive and rigid loac! shirting
1Il,BHS(
solut.ions, TREE opens a dii1logue
between the ut.ility and their
consumer allowing t.hem t.o   \VOl&#39;k
t.oget.her on energy eFficiency.
Features                                 events at any time, so you can                             to 500mW (depending on opemtional st.ate)
cont.inue using attached device                       • Switctles up to a 20Amp load
• Standard 3-prong 110VAC, plugs into          witllDut interruption
any stane]ard t10rne outlet                                                                        • Switclles at 0 (zero) crossing for non-
• On board temperature sensor lets                           resistive loads
• Consumer safe plastic IlOusing               you turn attached appliance on or off
• Power measurement with +/-1% accuracy
• Designerj t.o safely switcll (turn on/       based on ambient temperature
off) any housellDld loae], inCllliJing                                                             • Temperature measurement (ambient) with
• Over-the-Air (OTA) enabled firmware
ligllts, mot.ors, A/C units, computers,      update support
+/-ldegree C. accuracy
• Colell&#39;er!&#39; LED light.s indicate
• EmlJedded Tendril Profile provides                   Req
VClrlOUS conditions for user (In(J
for local or remote network
customer support                                                                                  TeMril Resident.ial Energy Ecosystem (TREE)
cOlllmissioning and diagnoslcs
• J\-B-C switch lets you easily select                                                              AMI smart meter
t.he level of part.icipat.ion in smilrt
energy programs offered i)y your           Technical Specifications
utility (e.g.. position f\ ,nrJicates
• 110Volt i\C standard wall power
that the device will ignore (H1y
outlet                                                f:CC Cerliiication pending
Signals or events corning from tile
ut.ility, whereas poslt.ion C indicates    • ZigBee&quot;&#39;/802.15.4 Radio                              Designed for ZigBee
maximum participation, i,e .. turn
• 2.400-2.483 GHz. unlicensed
off nttaclled nppliance wilen utility
signi1ls a peail-Ioa,j r()rJuction event.
ISM baM                                              Avaiia
• 100mW power-amp output                               Q32008
ljuring sLimmer IliglHiemand t!ours.)
• -94dBm receiver sensitivity
• Easily accessible override button
lets you opt out of any smart energy       • Internal power consumption: 100mW
Get out there. Extend the range of your smart energy network for large areas or access hard to reach
an outlet. That&#39;s all it takes, just plug it into a standard electrical outlet, register and you are
Tendril Echo is a ZigBee C&#39;; enabled device that helps ensure all your smart energy devices - such as in-
home displays, smart outlets and gateways - can be placed wherever you want in the home, even the
largest homes or those with unusual layouts.
• Enhances the coverage and range of tile in-home ZigBee       • Extends ZigBee networks to enable smart energy
wireless network for very large homes or harel to reach         applications over longer distances required in
areas.                                                          environments like apartment complexes.
• Ensures tllat your in-home display, ZigBee gateway and
otller smart energy devices have the ability to communicate
with eacll other and with your smart meter, even if tllat
meter is far away from your main living area, such as in an
external carport or tile far side of your garage.
.es               &#39; -                  ,                          ,Petitioner&#39;s Exhibit JMS-R4
Tend.                          t   Energy Ecosystem (TR             establishes a fwo-way Cause No. 43623
dialogue between consumers and utilities to create                                                            Page 28 of34
TREE is a standards based
System (REMS) that connects utility
back office systems with smart
energy devices in the horne, With
Tf&lt; EE. utilities have an e;,tensible
saving programs that help manage
consumer experience, Uniil(e one
way. intrusive and rigid load .shifting
solutions. TREE opens a dialogue
between the utility and their
consumer allowing them to work
together on energy efficiency.
Featu res                                 Technical Specifications
• Standard l:LOVAC. can be plugged into         • Int.ended for lise in Iwmes over
Tendril ResidentiElI Energy Ecosystem (TREE)
any standard 3-prong Ilorrle outlet             5000s,f. to provide ample radio
coverage, tJut can also be useeJ to       AMI smart meter
• Consumer safe, durable plastic
in smEllier 110mes to boost signal
housing, water resistant
strength if necessary
• Colored LED light. indicates                                                              Standards
vEirious conditions for user and              • ZigBee&quot;&#39;1802.15.4 Radio
FCC Certification pending
customer support                               • 2.400&#183;2.483 GHz. unlicensed
ISM band                                  Oesignedfor ZigBee
• Over-the-Clir IOTA; enabled firmwClre
upclate support                               • 100mW power-amp output
• Co-branding available                         • -94dBm receiver sensitivity               Availability
• Embedded Tendril Profile provides             • Internal power consumpt.ion: 500mW        Todi-1Y
extended smart energy functionality              to 1.2W (cJepending on operational
and remote diagnostics                          state)
ow                   Now you can understand and control your household energy consumption. Tendril Insight
tracks kilowatts and cost-per-hour of your energy as you use it for up-to-the minute bill tracking.
Feels at home. Whether freestanding or wall-mounted, the sleek design goes well in your kitchen, family room
Tendril               is a ZigBee&#174; enabled in-home display that communicates with networked Slilart devices
- including thermostats, electricity meters, outlets, or Tendril Vantage - to provide consumers witll
information they need to better understand, manage and control their energy consumption. Tendril
Insight can display a variety of screens that show consumers their basic monthly consumption and the
associated cost, their month-to-date and estimated monthly bill, and utility electricity pricing and load
control event messages. Tendril Insight provides users with the ability to set personal alerts that will
notify them during times of peak demand.
• Displays current householcl energy use, in both kilowatts and      • Makes consumers aware of fluctuating energy
dollars-per-hour.                                                   prices and consumption rates with a variety of audio
• Offers monthly bill tracking with up-to-date billing information
and an estimated end of month bill.                                • Allows text messaging from utility.
• Displays cost of electricity in real-time.                         • Provicles wireless software updates of the latest
til                       Ecosystem                    establishes     rfUtj!\~~~&#39;S~:~~:~~~6~~
d             e between consumers and utilities to create                                                                 Page 30 of34
TR EE is a standards based
System lREMS) that connects utility
back office systems with SITIJlt
energy devices in the horne. With
TREE, utilities have all e;(tensible
platfoilTi from which they can
saving programs that help rnanage
(:f!l..p.lt3~Dr ~r&#39;l
21(,&#39;Hl(&#39;LQ~-&quot;~l
consumer experience. Unlike ol1e
way, intrusive and rigid load shifting
solutions, TREE opens a dialogue
Features                           Technical Soecil&#39;jc3tion,s                                         uirernents
• Consumer friendly packclge              • 128x240 pixel monochrome                                 Tendril Residential Energy Ecosystem (TREE)
display witl1 9.2 x 5.3 centimeter
• Durable plastic Musing,                                                                            IIIVlI smart meter
• Backlight with ambient light sensing
• Wall powered via 110VIIC
power adapter, with G&#39; corr!              and Red-Green-Blue color options                          Stand
• Large fonts with home screen
• Retmct8ble st8nd for plficinl,; 8t                                                                 FCC Cortification pending
upright vieWing angle (e.g.. 011          viewable from 8+ feet
Designee) for ZigBeo
coullter) or layrng flGt              • ZigBee&quot;/802.15,4 Radio with
• Rubber paeJs at l)ase to provide          Tendril additional functionality
stability and avoid slippage on       • 2.400 - 2.483 GH. unlicensed ISM                         rWCl.lO.J.lity
flare] surfaces                         banei
• Colored LED lights indicate             • 100mW power-amp output
various conditions for user and
• Internal power consumption 1.2W
• Over-tlle-Air (OTA) enabled firmware      to 1.8W (depending on operational
• Colored back light for alerts
• Embedded Tendril PI-ofile provides
extenelerj smart energy functionality
and remote diagnostics
It&#39;s a matter of               This smart thermostat adjusts your home&#39;s temperature to optimize comfort and
Don&#39;t         overloaded, Rules can be defined to adjust energy consumption as costs and demand fluctuate.
Tendril Set Point is a ZigBee&#174; enabled thermostat that communicates with a variety of in-home devices
-    such as outlets, electricity meters or Tendril Vantage -      to help you better understand, manage and
control the energy consumption in your home.
• As a smart energy device, Tendril Set Point can indicate            specific &quot;price rules&quot; designed to work with
wllether or not a load is lleing controlled, such as if           smart energy demand response programs. Or,
tile heating or cooling system is on or off, whicll allows        for more customized per&#39;formance, Tendril Set
consumers to more effectively rnonitor electricity                Point is dynamically re-progr&#39;ammable to create
consumption, responci to fluctuations in electricity prices       different bellavioral responses to pricing rules ami
and manage energy loads.                                          information. What&#39;s more. Tenelril Set Point can
be securely and directly registered witll a utility
• Specifically designeel to provide out-of-the-box convenience
company for demand response anel direct load
and control, Tendril Set Point is wired to traditional HVAC
units just like any other thermostat to control the HVAC via
user-controlled set points. It comes pre-programmed with
,                                             .     Petitioner&#39;s Exhibit JMS-R4
Tendril Res&quot;&lt;k,nfi&#39;,,,! Energy Ecosystem (TREE) establishes a two-way Cause No. 43623
dialogue                 n consumers and utilities to create                                                              Page 32 of34
System [REMS) that connects ulility
back. ofRce systems with SITIJrt
TI&lt; EE, utilities have an extensible
(;fll,~l~ ~~a   tAUI
W~~U~EUHr.:(
peak.loJds and improve the overall
consumer experience. Unlike one
tI~HRiR(fIir..
way. intrusive and rigid load shifting
tll;AH~r
Fea.tures                            • Oifers remote programming                                         uircrnents
capability (as directed by rules set
• Stanclarej tl1ermostat functions          in Tendril Vclfltage)                                       Tendril Residential Energy Ecosystem (TREE)
• 7-day digital, programmable
• Remote access allows Tendril                                AMI smwt mete,.
• Standard HVAC system controls
Vantage to indicate current
(24VAC ANSI)
temperature and to store Ilistorical
• Battery backup (typical 1.8 montl1
battery life)                          temperature patterns
• 4 programmable set pOints eacl&#39;l     • OveHhe-Air (OTA) enabled firmware                           FCC Certification pending
day                                    upoate support                                              Designed for ZigBee
• Temporary or permanent I,old
• Co-branding availatlle
• Embedded Tendril Profile provides                          A.vaiiabi
• Network commissioningU1rough a
extended smart energy functionality
user-accessible ITlenu                                                                               Q32008
• External controls to allow user
overrieJe
Tech ni ca l Speci r, reli&quot;   rnl C
• Text ITlessage area of 20 or more
characters to allDw for utility         • ZigBee&quot;/802.1.5.4 Radio
generated customer messages
• 2.4ClO - 2.483 GHz. unlicensed ISM
• Imjicators for current price, pending     banel
demand response and direct ioad          • 1.00mW power,amp output
• Colored LED lights indicate
• Internal power consumption:
various conditions fDr USH aM
240-500mW
Use your existing high-speed Internet connection to create your own smart energy network.
Get automatic feature updates and upgrades for your smart energy devices as
r,YP.nspc&#183;n is a ZigBee@ IP gateway device for consumers. It can send and receive energy relatee!
data including: cun&quot;ent price and consumption data from a ZigBee-enabled electricity meter, up-to-
date billing information, regUlar consumption information for historical cataloging and commissioning,
registration and diagnostics messages .
• Connects Ule in&#183;&#183;home ZigBee wireless network to an          • Operates in conjunction with smart energy
internet broadi)and router (cable-modem, DSL-moelern,         programs of your local electricity provider to help
etc.).                                                         conserve power and save you money (where
applicable ami if enrolleel in these programs) .
• Enallles unprecedenteci insigllt into and control over
household energy footprinl by providing access to
gl&#39;3phical wei)-based information, improving overall energy
Petitio~~r&#39;s      Exhibit JMS-R4
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Page 34 of34
Tf&lt; EE is a standards based
Residential Energy tv1anagernent
SystEm (R EMS) that connects utility
back office systems vvith smart
energy devices In the home, Witl&#39;
Tf&lt;EE, utitities have an extensible
platrorrn from which lhey car:
engage their custorners in ene!&#39;gy
peak loads 2nd improve the overall
waYl jntrusive and rigid toad shifting
!&#39;j   Designed to serve as an in-honie                    Tendril Residential Energy Ecosystem (TREE)
c     Consumer safe, ducable plastic                                    S&#39;,lart energy application platform                 llMI SlTiart meter
i&quot;10Using, vvater resistant                                 ~     Smart Energy ESP (Energy Services                   Spare etnernet port on your &#39;n-rlorne
0&#39;)   Rut)i)(~r    pads on U8se to provide                              Porta!) capable                                     tJroacJDancl router   ()r&quot;   l&#39;iOrY1n network
stability r.&quot;Tld avcieJ slipping en IlarcJ
o i\r~iVJD    32-r)it Processor
Q     [iY\UedcJed Linux OS
G     Scr(-;\,;   110les   in   lJ(3 S;:&quot;;   for \\&#39;all&#183;&#183;mount.
applicat.ions                                               • lGi\iU FV\lvl. 8MB FI21Sf1
&#162;.    Colored LED lights indicate various                         • Zigf3ee&quot;/802.15.4 Radio
DeSigned fO( ZigBee
concJitiOf]Sfor user and customer
• 2.40C-2,483 GHI. unlicensed
sLlppcrt
ISf&#39;v&#39;i band
&lt;l)   \iVa!! powereU via L10V/\C power
e     1GOmVV power-amp output
adapter, \ViUi 6&#39; c!iord
Tod21Y
~     &#183;94cJBrn rcc(!lver sensitivity
~     6&#39; EU&#39;lernet cable for connectivity to
&amp;     Over-i:!1c&quot;&#183;!ntcrnet (OT!) soH\:vare
upeJates
, 1,-,tern211 power consurnption: 500l11W
:ri,--,-,,&#39;ncii,w on opei&quot;ationdl
rss feed, Supreme Leader, National Association of Home Builders, June 14, June 23, The Spokesman, June 29, The New York, working families, News Source
CITY OF WHITING – JUNE 15_ 2009
INDIANA UTILITY REGULATORY COMMISSION AFFILIATED CONTRACTS and ..._1_
INDIANA UTILITY REGULATORY COMMISSION AFFILIATED CONTRACTS and 2009 Utility Incentives - Windows