4.1.4. Section 1.D: Relationship to the Standard Practice Manual

The attached protocols use the cost-effectiveness tests described in the SPM and originally developed to apply to energy efficiency activities to determine the cost-effectiveness of each demand response activity. There are four SPM tests, designed to measure cost-effectiveness from four different perspectives - those of society, the program administrator, the ratepayer, and the participant. The details of the SPM tests have been modified, as discussed in Section 2 of the protocols, to make them more appropriate to demand response. The protocol requires calculation of all four tests, and makes no judgment of relative importance of the various tests in making program planning decisions. The determination of which test(s) are most important for program approval and the relative weight of the tests in that determination will be made in the relevant proceedings.