16. Continuation of 2010-2012 Programs not
Addressed Elsewhere in this Decision
In this section, we identify several additional energy efficiency programs in the current 2010-2012 program cycle that we believe merit continuation into the 2013-2014 program cycle. Our main criterion for prescribing these programs is that they support our long-term market transformation goals under the Strategic Plan. Unless otherwise specified, the proposed activity levels in 2013-2014 should be roughly comparable to the approved 2010-2012 levels.
16.1. HVAC and Benchmarking Programs
The residential HVAC Quality Installation and Quality Maintenance programs, commercial HVAC Quality Installation and Quality Maintenance programs, and funding for the Western HVAC Performance Alliance are key programs in our efforts to transform the HVAC industry. SDG&E and SoCalGas should propose to increase the activity levels for these programs commensurate with the other utilities' levels of commitment.
Through D.09-09-047 and subsequent modifications, the IOUs were directed to implement benchmarking in commercial energy efficiency programs, and commit to associated benchmarking targets by the end of 2012. During 2011, the Commission commissioned a study by NMR Consulting and Optimal Energy to evaluate and report on the status and impact these benchmarking initiatives are having on both savings and program awareness and participation. The report also reviews the Energy Star Portfolio Tool, and the utilities' Automated Benchmarking Systems. Lastly, this study surveys numerous customers and profiles their experiences with utility benchmarking, and aims to understand how to improve these efforts in the future. The Final Report is expected to be released in March 2012 and will provide recommendations on how to improve benchmarking activities at the utilities. We direct the IOUs to continue their benchmarking activities in 2013-2014.
We also provide guidance regarding two 2010-2012 strategic initiatives - integrated demand-side management and Continuous Energy Improvement -- which we believe warrant additional attention.
16.2. Integrated Demand-Side Management
Integrating demand-side program offerings has been an objective of the Commission since 2007. The Commission has provided extensive guidance to the utilities for promoting integrated program offerings of energy efficiency, demand response, and distributed generation programs. In this section, use of the terms "integrated," "IDSM," "DSM," and "Demand-Side Resources" refer to all three primary demand-side energy resources: energy efficiency, demand response, and distributed generation, and also to storage where appropriate.
In D.07-10-032, the Commission first required the utilities to "integrate customer demand-side programs, such as energy efficiency, self-generation, advanced metering, and demand response in a coherent and efficient manner."418 The intent of integrating DSM programs described in that decision was to achieve maximum savings while avoiding duplication of efforts, reducing transaction costs, and diminishing customer confusion.419
Per D.07-10-032, integration would address the full range of comprehensive consumer demand-side options, promote a systems integration approach within RD&D, design, hardware, controls, codes and standards, and installation and maintenance, and would include a process to engage external subject matter experts.420 California's Long-Term Energy Efficiency Strategic Plan adopted by the Commission in September 2008, includes a chapter dedicated to Integrated Demand-Side Management goals and objectives that the utilities were to reference for their 2010-12 program. Additional Integrated Demand-Side Management related guidance in D.09-09-047 established a joint utility Integrated Demand-Side Management taskforce.421 We provided guidance on the issue of integrating demand-side energy programs and resources in, among other things, D.07-10-032, the April 2008 Assigned Commissioner Ruling, the October 2008 Assigned Commissioner Ruling, and D.09-09-047.
Decision 07-10-032 directed the utilities to use existing Demand-Side Management funding sources to fund pilot projects to achieve the Integrated Demand-Side Management goals and objectives identified in the rulings and decisions above. Commission Staff was directed to supervise an independent third-party evaluator's assessment of the success of utility Integrated Demand-Side Management efforts in the 2010-2012 portfolio to aid DSM integration efforts in future program cycles.
An August 2010 Ruling on guidance for the 2012-2014 demand response applications directed that future authority and funding for the demand response portion of Integrated Demand-Side Management activities be considered in energy efficiency proceedings starting with the energy efficiency applications for 2013-2015.422
Parties support continuing Integrated Demand-Side Management activities as part of the 2013-2014 energy efficiency portfolio. Ecology Action supports inclusion of resource integration, comprehensiveness, and lost opportunities in cost-effectiveness calculations while "considering the issue of integration of efficiency, generation, demand response, storage and electric transportation."423
SDG&E and SoCalGas state that, "with this anticipated [energy efficiency transition] funding the Commission needs to ensure that any program integration or coordination requirements continue as required and direction for [Integrated Demand-Side Management] activities and budgets are included in the expected energy efficiency bridge portfolio guidance."424 SDG&E/SoCalGas go on to state that they:
... should continue to...provide the customer with a more comprehensive and unified approach thus promoting Integrated Demand-Side Management "IDSM" solutions. Integrated Demand-Side Management solutions will not only promote [energy efficiency] solutions but where applicable, demand response and renewable solutions. This would minimize customer confusion when attempting to identify the best energy management options for their homes and businesses.
We agree with party positions that the statewide Integrated Demand-Side Management program and related integration goals and objectives should continue to be pursued in the 2013-2014 transition portfolio. Commission Staff is currently overseeing an independent third-party evaluation to assess the success of the Statewide Integrated Demand-Side Management Program and disseminate lessons learned. This evaluation is expected to be completed by the end of 2012.425
Though the taskforce was previously directed to utilize external subject matter experts in its deliberations, only one external subject matter expert was invited to participate in Integrated Demand-Side Management taskforce meetings (by Commission Staff). We direct the utilities to revise their existing Integrated Demand-Side Management PIP for the 2013-2014 transition portfolio, and again require that they include in the PIP a clear plan to obtain input from stakeholders concerning each of the eight tasks (identified in D.09-09-047), including, as necessary, public workshops, reporting, and coordination with Commission Staff and the Integrated Demand-Side Management taskforce. This plan should also actively include interaction with external subject matter experts in Integrated Demand-Side Management taskforce deliberations on a regular basis.
Additional guidance appears to be required for integrated pilot program offerings. However, there is lack of quantifiable data that would measure the success of Integrated Demand-Side Management pilots in terms of kilowatt-hours, kilowatt, and financial savings, GHG emission reductions, avoided lost opportunities, minimized water usage, and a broader range of sustainability areas.
We direct the utilities to include in their revised Integrated Demand-Side Management PIP a detailed accounting of all "integrated" Integrated Demand-Side Management pilot programs and projects using the table presented in Attachment D of this decision. We further direct the utilities to work with Commission Staff to ensure that an adequate level of detail is provided in reports on Integrated Demand-Side Management pilot efforts. Should the utilities find that their Integrated Demand-Side Management pilot offerings are not addressing our guidance on resource comprehensiveness, design characteristics, promotion of emerging technologies, and the testing of integrated cost-effectiveness and evaluation methodologies that support Integrated Demand-Side Management objectives, they shall provide a scope and budget for revamping their Integrated Demand-Side Management programs in the 2013-2014 portfolio via their revised PIP.
For 2013-2014, we direct the utilities to propose in their Applications a strategy to have an integrated audit tool for Integrated Demand-Side Management activities. The utilities should harmonize timelines and approaches, to have a similar tool on a statewide basis. We direct Commission Staff to monitor the development of the audit tool.
In addition, if the utility's audit tool is not completed by the time it files its 2013-2014 application, we direct the utility to include in its application a revised Integrated Demand-Side Management PIP with an updated audit tool completion timeline. The revised document shall focus on the business requirements used to select the IOU's audit development vendors and Attachment C of the October 2008 ACR referenced above. The revised PIP should also provide a plan to disseminate and utilize the audit tool, once it is completed, and for incorporating, mid-cycle, any additional data and lessons learned from the 2010-2012 evaluation, when finalized.
There are few examples of integrated marketing campaigns and related material that actively promote the full range of Demand-Side Management resources to customers. The minimal efforts in this area have not led to the long-term reductions in marketing and program costs envisioned for Integrated Demand-Side Management marketing efforts. We direct the utilities to include in their revised Integrated Demand-Side Management PIP a clear plan to pursue integrated marketing in the 2013-2014 program cycles. By "integrated marketing," we mean marketing strategies, messages, and material that simultaneously promotes demand side resources to customers and seeks to educate them about the benefits of pursuing these resources where feasible. This plan should include the development of new marketing collateral and strategies that offer `bundles' of Demand-Side Management resources/programs targeted to specific customer groups via "one stop" approaches were possible, as well as a statewide integrated marketing plan per Strategic Plan objectives.
To determine whether pilot programs are designed in a manner that achieves the Integrated Demand-Side Management objectives described in Integrated Demand-Side Management Pilot section above, we direct the utilities to include data collection plans in their revised Integrated Demand-Side Management PIP in the 2013-2014 portfolio applications that:
· Consider current reporting expectations for each of the Demand-Side Management strategies;
· Identify the common information that is currently collected for Demand-Side Management resources; and
· Propose a strategy for reporting integrated Demand-Side Management information.
The plans should be clearly linked to the Integrated Demand-Side Management goals and objectives for the pilot programs and projects. The utilities are encouraged to work together as they will be expected to provide the Commission standardized data (i.e., standard across the utilities). Commission Staff will review the proposed Integrated Demand-Side Management data collection plans and the Assigned Commissioner will approve final data collection plans in the 2013-2014 transition portfolio reporting requirements.426
In the Integrated Demand-Side Management process to date, the utilities have consistently identified the lack of shared funding among Demand-Side Management program areas as a barrier to achieving Integrated Demand-Side Management objectives. We urge all Integrated Demand-Side Management taskforce representatives to actively participate in the service lists for all applicable proceedings to develop of a record in each proceeding that would aid in developing a policy, funding opportunities, and mechanisms to promote integration of demand-side energy resources. We also urge the utilities to include in their revised Integrated Demand-Side Management 2013-2014 PIP a plan for how they will coordinate and participate in and between demand-side resource proceedings going forward.
Additionally, it appears that with the adoption of this Decision, the demand response portfolio cycle of 2012-2014 and the energy efficiency portfolio cycle of 2013-2014 will be in sync starting in 2015. Since not all of the relevant resource proceedings are on concurrent cycles, it is reasonable for the utilities to make their proposals and funding requests for demand-side resource integration activities in their energy efficiency applications. We direct the utilities to include the demand response, distributed generation, and relevant AMI-portions of their Integrated Demand-Side Management-related costs in the Integrated Demand-Side Management budget requests included in their applications, with justification for why funding should be continued.
16.3. Continuous Energy Improvement
Decision 09-09-047 approved a new statewide sub-program in all three non-residential market segments (industrial, agriculture, commercial) called the Continuous Energy Improvement program. This program is a pilot program which seeks to test innovative new approaches that promote customer demand-side energy resource management by offering the tools and incentives for high load customers to incorporate energy management practices into their business and operating plans.
The Continuous Energy Improvement pilot has almost reached its participation level goals and initiated a Continuous Energy Improvement process evaluation beginning in 2012 to develop lessons learned and best-practices. It is however unlikely that evaluation findings will be available in time for 2013-2014 program planning. We direct the utilities to propose to continue to support the Continuous Energy Improvement program in their 2013-2014 portfolios and to include a Continuous Energy Improvement PIP in their 2013-2014 portfolio applications. The aforementioned PIP should clearly link Continuous Energy Improvement program activities to supporting the statewide Integrated Demand-Side Management program's goals and objectives, and recognize the Continuous Energy Improvement pilot program as an "integrated pilot" program geared toward these purposes.
With regard to workforce education and training the current Continuous Energy Improvement PIP stated, that "Continuous Energy Improvement implementation shall [be] integrated with Workforce, Education, and Training efforts by providing Continuous Energy Improvement process and case study input to `energy engineer' curriculum designers for Community Colleges and Universities." We direct the utilities to include strategies in their 2013-2014 applications to actively engage workforce education and training sector strategy efforts. The costs associated with funding these efforts should be shared between the Continuous Energy Improvement and the Workforce Education and Training Statewide Program budgets.
Lastly, although the Continuous Energy Improvement program was designed to support large commercial, agriculture, and industrial customers, utility Continuous Energy Improvement program representatives have identified the need to include a focus on mid-sized non-residential customers (typically identified as customers with less than 500 kW load). Similarly, Commission Staff has also identified the smaller business customer segment as one that has not been adequately served by utility programs. PG&E agrees that the utilities should develop strategies "to better reach under-served small and medium business (SMB) customers."427 Consequently, we direct the utilities to propose expansion of the Continuous Energy Improvement pilot scope to include mid-sized non-residential customers in the 2013-2014 portfolios in their revised PIP submitted with their 2013-2014 applications.
Once early Continuous Energy Improvement evaluation findings become available, Continuous Energy Improvement PIPs should be revised to describe how the program will be modified mid-cycle in consideration of these findings.
418 D.07-10-032 at 5.
419 D.07-10-032 at 6.
420 D.07-10-032 at 31.
421 D.09-09-047 at 216.
422 Administrative Law Judge's Ruling Providing Guidance for the 2012-2014 Demand Response Applications, Rulemaking (R.) 07-01-041, August 27, 2010 at 15.
423 Ecology Action Comments on Phase IV Scoping Memo at 4.
424 SDG&E/SoCalGas Comments on Phase IV Scoping Memo at 7.
425 Early evaluation findings are available at http://www.energydataweb.com/cpuc/home.aspx.
426 Reporting requirements for energy efficiency are specified by the Assigned Commissioner, pursuant to D.09-09-047, and posted on the EEGA ( http://eega.cpuc.ca.gov/) website.
427 PG&E Comments on Programmatic Guidance Ruling at 9.
