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Otter Tail Power praised for energy-savings effort by state utility regulators

PIERRE -- The three elected members of the South Dakota Public Utilities Commission took their fine-toothed comb to Otter Tail Power's electricity-efficiency program and liked what they found Tuesday.

PIERRE - The three elected members of the South Dakota Public Utilities Commission took their fine-toothed comb to Otter Tail Power's electricity-efficiency program and liked what they found Tuesday.

The state regulators praised Otter Tail for its 2015 results and voted 3-0 to accept the report. The company is based at Fergus Falls, Minnesota, and serves customers in parts of northeastern South Dakota.

Commission chairman Chris Nelson asked questions about whether one business customer received too much benefit from the efficiency program's reimbursement system.

But Nelson ultimately said he accepted Otter Tail's answer that the customer's reimbursement was spread across two years at the maximum rate of 20 percent annually set by Otter Tail internally.

Commissioner Gary Hanson described himself as a big supporter of efficiency programs and called Otter Tail's performance "a tremendous benefit" in the long term to the utility and to the public.

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Jason Grenier, head of Otter Tail's market planning department, said 2015 was the utility's eighth year of operating energy efficiency programs in South Dakota. He said the 2015 effort produced $3.6 million of utility net benefits, he said.

There is more emphasis lately on reducing summer energy demand and avoiding the need to purchase high-cost power at peak times, according to Grenier.

The overall summer program is intended to help offset the necessity for additional capacity resources. "That's where the savings are really coming from," Darren Kearney, a PUC analyst, said.

Otter Tail budgeted $60,000 toward reducing residential demand for electricity and spent $37,057, according to its report to the commission. However, the company budgeted $258,000 for its commercial efficiency program and spent $299,694.

The efficiency plan achieved actual energy savings of 4,239,371 kilowatt-hours for the year, reaching 151 percent of the planned savings, according to the PUC's analysis.

Commissioner Kristie Fiegen said Otter Tail had an "outstanding" performance. "That's pretty amazing, and I think our customers in the northeast are being taken care of," she said.

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