NAC704.9523. Accounting for and recovery of costs of implementing programs for energy efficiency and conservation.

     1. All costs of implementing programs for energy efficiency and conservation must be accounted for in the books and records of an electric utility separately from amounts attributable to any other activity. All accounts must be maintained in a manner that will allow costs attributable to specific programs to be readily identified.

     2. An electric utility may, pursuant to subsection 3, recover all reasonably incurred costs of implementing programs for energy efficiency and conservation that have been described in the demand side plan of the electric utility and approved by the Commission pursuant to NAC 704.9494 as part of the action plan of the electric utility, including, without limitation, the costs for labor, overhead, materials, incentives paid to customers, advertising, marketing, monitoring and evaluation.

     3. To recover the reasonably incurred costs of implementing programs for energy efficiency and conservation, an electric utility must:

     (a) Establish and maintain separate subsidiary records of the subaccounts of FERC Account No. 182.3 (Other Regulatory Assets) for each program described in the demand side plan of the electric utility and approved by the Commission pursuant to NAC 704.9494 as part of the action plan of the electric utility. These records must clearly delineate all costs incurred by the electric utility in implementing each program approved by the Commission and be maintained by program by month by rate effective period.

     (b) At the time the electric utility files an annual deferred energy accounting adjustment application pursuant to subsection 3 of NRS 704.187, apply to the Commission to establish the following period-specific rates:

          (1) A prospective base program cost rate which is determined by allocating in the manner approved by the Commission in the most recent general rate case of the electric utility the total cost of programs for energy efficiency and conservation that are described in the demand side plan approved by the Commission. The prospective base program cost rate for a customer class is an amount equal to the cost allocated to that customer class pursuant to this subparagraph divided by the projected kilowatt hour sales for that class for the relevant period.

          (2) A deferred program cost rate to clear the period-specific balance over 12 months. The deferred program cost rate is an amount equal to the period-specific balance in the subaccount of FERC Account No. 182.3 for the cost of programs for energy efficiency and conservation divided by the applicable test period kilowatt hour sales.

     4. An electric utility shall account for period-specific costs incurred to implement a program for energy efficiency and conservation and revenues received from the period-specific prospective base program cost rate in the following manner:

     (a) On a monthly basis, the electric utility shall record in a subaccount of FERC Account No. 182.3 the program costs incurred and the revenues received from the prospective base program cost rate for the program for energy efficiency and conservation.

     (b) The electric utility shall apply a carrying charge at the rate of 1/12 of the authorized overall rate of return to the unamortized balance in the subaccounts of FERC Account No. 182.3.

     (Added to NAC by Pub. Utilities Comm’n by R004-04, eff. 5-25-2004; A by R162-07, 6-17-2008; R051-09, 1-28-2010; R042-10, 7-22-2010)