14. Customer Outreach and Education - Small and Medium Customers
According to PG&E, there are currently approximately 75,000 medium-sized (maximum demand less than 200 kW but greater than 20 kW) C&I customers, approximately 415,000 small C&I customers (maximum demand less than 20 kW), and approximately 80,000 small agricultural customers (maximum demand less than 200 kW), for a total of about 570,000 smaller business customers. Virtually all of these customers are subject to defaulting to new rates on or after February 1, 2011, C&I customers onto PDP and agricultural customers onto TOU. Approximately half of the small agricultural customers are already on TOU rates, half are not. Few smaller C&I customers have experience with CPP rates. PG&E indicates that approximately 300,000 of these customers will default to new rates before October 2011 and therefore will receive some direct outreach through efforts outlined and costs reflected in this application.
14.1. PG&E's Proposal
PG&E states that it expects the outreach effort for these smaller customers to be more challenging than for large customers, due to factors such as smaller customers' lack of experience with anything other than flat rates, PG&E's inability to reach most of these customers on a one-on-one basis, smaller customers' lack of familiarity with their energy use, and, in some situations, their lack of facility with English. Costs specific to these customers relate to account services staffing for Person-to-Person and general awareness outreach, and various activities related to Awareness and Education, and total $22.20 million of which PG&E considers $20.58 million to be incremental.
Person-to-Person Outreach
PG&E proposes to provide more support for inbound customer calls requesting advice on rate selection, energy management, bill fluctuations, use of web-based rate analysis tools, etc. PG&E notes that CSRs who work in PG&E's Business Customer Service Center will receive updated dynamic pricing training. Also, in May 2010, after the default date for large C&I customers has passed, PG&E plans to deploy an additional 15 Dynamic Pricing, for a total of 40, and an additional 20 Account Managers, for a total of 21 to support the broad customer awareness campaigns targeted at these customers, as well as to help with individualized rate analyses. PG&E estimates these additional labor costs to be $3.70 million through 2010, all of which would be incremental.
Awareness and Education
According to PG&E, its outreach to smaller customers will necessarily focus heavily on a broad Awareness and Education campaign consisting of direct outreach, educational materials and collateral, on-line content development, paid media (e.g., off-line and on-line business and trade journals and geo-targeted media), earned or unpaid media (e.g., contributing to trade journal articles about dynamic pricing), staffing, and customer workshops for those most at risk of significantly negative bill impacts. This awareness campaign will be geographically specific in accordance with SmartMeter rollout and will alert customers to the rate change and direct them to self-help resources, including the PG&E website and call centers. PG&E also proposes to provide a variety of ways for customers to respond, including on-line forms and self-mailer response cards, with call center support.
Direct outreach timed to customer default dates will involve the design, production and distribution of multiple and in-language versions of e-mail, direct mail, and bill inserts. PG&E's 2010 forecast for this work is $6.45 million. However, incremental costs for this activity are $1.6 million less, or about $4.9 million. Development, production and refinement of educational materials and collateral, in-language translation, and revisions are estimated to cost an incremental $3.075 million.
Additions to the company's website will include information on and timing of the new rates, rate comparison tools, industry or segment-specific dynamic pricing rate explanations, and case studies of customers who have successfully shifted load to realize the benefits of DR. PG&E states it will make information available off-line upon request. Developing and designing the new on-line content is estimated to cost an incremental $0.60 million.24
Paid media work, including creative development and design of targeted awareness campaigns, and planning to determine the off-line and on-line magazines, newsletters and other trade publications that will reach the desired audience, will cost an estimated incremental $5.00 million.
Staffing will involve creation of an outreach awareness and education team devoted to these smaller customers. The team will include one Dynamic Pricing Outreach Supervisor, one and one-fifth Dynamic Pricing Project Managers, and two Dynamic Pricing Coordinators, costing an estimated incremental $0.875 million through 2010. All the incremental Dynamic Pricing Specialists and Account Managers will be team participants.
Customer workshops will help to actively engage smaller customers who are difficult to reach or unresponsive to direct outreach. Costs, including event management agency fees, administration and production, travel expenses, event sponsorship and community involvement fees, etc., will be an incremental $2.50 million in 2010.
PG&E estimates total 2009-2010 Awareness and Education costs associated with medium and small C&I and small agricultural customers to be $18.50 million with the incremental costs amounting to $16.88 million.
14.2. Discussion
Regarding person-to-person outreach, we direct PG&E to ensure that a customer service representative directly contacts at least the 10% of small and medium customers whose bills are likely to be increased by the largest percentage based on previous year's usage, if they are defaulted to and stay on the PDP rate. PG&E shall include a description of how utility representatives will engage these customers in its Customer Education and Outreach plan. (See Section 18.1.)
Issues relating to DRA concerns regarding commercial customers with loads less than 20 kW (small commercial), and DRA proposals for an Independent Evaluator and an Outreach Advisory Panel, along with our concerns regarding measurement and evaluation, are discussed later in this decision. No other party objects to any specific activities or total costs (as opposed to incremental costs) related to PG&E's proposal, as described above, and we determine that they are reasonable for setting the revenue requirement in this proceeding. However, we have previously determined in this decision that PG&E's analysis of the incremental nature of these costs is not reasonable and will reduce the total $18.50 million cost of Awareness and Education by $3.98 million, rather than $1.62 million as proposed by PG&E, to determine the incremental cost amount of $14.52 million for this category. This results in our adoption of $22.20 million total costs and $18.22 million incremental costs for outreach and education for medium and small C&I and small agricultural customers. Contingencies related to these adopted costs are discussed further on in this decision.
24 Cost recovery related to customer web presentment infrastructure upgrades and development of on-line rate selection tools are discussed separately in this decision.
