6. Productivity

D.98-04-059 directed customers to demonstrate productivity by assigning a reasonable dollar value to the benefits of their participation to ratepayers. (D.98-04-059 at 34-35.) The costs of a customer's participation should bear a reasonable relationship to the benefits realized through its participation. This showing assists us in determining the overall reasonableness of the request.

In a policy proceeding concerned mostly with environmental issues it is difficult to estimate monetary benefits of an intervenor's participation. However, the intervenors provided sufficient information for our findings.

6.1. Union of Concerned Scientists

UCS submits that its contributions to the Commission's recommendations to ARB on regulating GHG emissions under AB 32 will help ensure that the GHG regulations for the electricity and natural gas sectors will minimize cost to customers and mitigate the potential for windfall profits to independent deliverers. Further, UCS' participation in this proceeding focused on maximizing the benefits to California customers from AB 32 regulations, and UCS advocated that allowance distributions to retail providers be invested in cost-effective emissions reduction measures that bring co-benefits to California customers, as well as rate relief for customers that may be impacted by higher costs under AB 32 regulations. The Commission's adoption of UCS' positions and recommendations regarding the auctioning of allowances and the distribution of allowance proceeds will help ensure that the GHG regulatory framework developed for the electricity and natural gas sectors will provide tangible benefits to California customers. Given the scale of investor-owned utilities' investments and customer costs that are likely to be influenced by the decision, UCS submits that its work in this phase of R.06-04-009 can be expected to save ratepayers many times the cost of UCS' participation.

6.2. Natural Resources Defence Council (NRDC)

NRDC emphasized that its continued focus on policies that ensure a reliable, affordable and environmentally sustainable energy resource portfolio that should have lasting benefits to bill payers is productive, although such policy contributions are difficult to monetize.

NRDC asserts that its participation in D.07-09-017 was productive because its emphasis on environmental integrity and attention to the details of reporting requirements will ultimately protect consumers by ensuring functional GHG regulations.

NRDC notes that it was one of only a few non-profit environmental groups that contributed to D.08-03-018. NRDC emphasized that it contributed detailed suggestions, including an analysis of the appropriate numerical threshold for a cap-and-trade program, and a detailed legal analysis. NRDC explains that strengthened energy efficiency programs and standards to capture all cost-effective energy efficiency will ensure that net benefits will accrue to customers. Increased energy efficiency and renewable energy will also benefit customers through environmental and health improvements. In addition, one of the potential benefits to a cap-and-trade system is the reduced cost of compliance, which would lower the cost impacts to customers. With regards to the point of regulation for a cap-and-trade system, NRDC's recommendations were directed at ensuring that whatever system recommended by the Commission would minimize costs and maximize benefits to customers. NRDC's legal analysis will help to ensure that California's efforts to regulate GHG are not delayed by legal challenges, thereby helping California consumers to avoid the monetary and time costs of litigation and instead reap the benefits of a lower-GHG economy sooner.

NRDC was one of only a few non-profit environmental groups that contributed to the process leading to D.08-10-037. NRDC argues that its comments provided a number of emissions reduction measures that will continue to be a part of the Commission's strategy for meeting AB 32's targets. Cost-effective energy efficiency, with its proven economic benefits to customers, is a negative cost solution. There are many benefits to customers of renewable energy, including reduced price volatility and environmental and health benefits. NRDC continually emphasized the importance of distribution of allowances in the public interest. NRDC's contributions on flexible compliance help ensure that real emissions reductions will help minimize the cost of GHG regulations to customers.

6.3. Conclusion

We find that the costs of UCS' and NRDC's participation, with our reductions and adjustments explained earlier in this decision, bear a reasonable relationship to their contributions, and that their overall participation was productive. We conclude that the overall benefits of UCS' and NRDC's participation will exceed the costs of their participation.