VI. Conclusion
Because of changes adopted by the Commission in D.05-10-044, the utility CARE and Low Income Energy Efficiency Programs are different from those envisioned in the 2006-2007 funding and program applications that we review here. However, it is important for the utilities to have assurances, prior to the beginning of the new year, that funding authority is in place. We approve the utilities' overall funding proposals for the CARE and Low Income Energy Efficiency Programs as reasonable because they are consistent with the funding levels adopted by the Commission for 2005 in D.05-04-052.
At the same time, we recognize that the utilities must rethink program details and funding needs in light of the new direction offered by the Commission. We direct the utilities to file new applications no later than July 1, 2006 proposing programs and funding levels for 2007 and 2008. These applications shall reflect the results of the Needs Assessment, if it is available in a timely manner, and reflect an effort to change from budget-directed planning to goal-driven planning and budgets.
We also approve new measures for the 2006 Low Income Energy Efficiency Program.
1. The funding levels requested by each of the utilities are reasonable because they are consistent with those approved by the Commission in D.05-04-052.
2. To support the accelerated effort to replace inefficient refrigerators as approved in D.05-10-044, it is reasonable to approve SDG&E's request to restore $1.091 million in funds that had been disallowed in D.05-04-052.
3. Cool Centers provide an important measure of comfort to LIEE and CARE customers who live in hot climates around the state.
4. The IOUs receive reimbursement on a dollar-for-dollar basis of all CARE bill subsidies, so the primary issue before us with regard to the CARE applications is the level of administrative costs each IOU seeks.
5. The utilities could not have anticipated the program changes adopted in
D.05-10-044 when they filed the applications underlying this decision.
6. These recent events prompt another look at overall programs and funding, including reconsideration of the current approach to planning Low Income Energy Efficiency Programs.
7. The utilities' proposed funding levels are reasonable because they are consistent with the funding approved in D.05-04-052.
8. Cool Centers help protect the health and safety of elderly, disabled, and low income customers. Cool Centers can serve an important energy efficiency function by encouraging some customers to come to one central, cool location rather than running individual air conditioners on the hottest days. In addition, these centers offer an opportunity to educate customers about their options for reducing energy consumption, including participation in the Low Income Energy Efficiency Program.
9. The Commission's goal in D.05-04-052 was to reduce the cost of running these Cool Centers, not to shut them down.
10. For purposes such as counting energy savings towards the Commission-established energy savings goals for 2006 and beyond, the Commission recognized in D.05-04-051 that we will need to more closely coordinate the load impact studies performed for Low Income Energy Efficiency with those studies and associated protocols being developed in our generic energy efficiency rulemaking, R.01-08-028.
11. In the current context, with the utilities utilizing census blocks, telephone registration, and other techniques pursuant to D.05-10-044 to accelerate and retain CARE enrollment, and with SB 580 implementation coming soon, it is appropriate, if not essential to give all of the utilities this type of CARE administrative spending flexibility.
12. Allowing SDG&E its requested additional funds for refrigerator replacement is consistent with the goals and program changes adopted in
D.05-10-044.
13. This is not a good time to reduce SDG&E's natural gas Low Income Energy Efficiency funding.
14. It is reasonable to allow the electric utilities to offer the replacement of existing central air conditioners with high efficiency units for all three residence types in Climate Zones 14 and 15 since doing so will consistently provide benefits for the program participants and contribute to a reduction in electric demand.
15. It is reasonable for the utilities to offer duct testing and sealing for single family homes and mobile homes with gas space heating in all climate zones and for homes with electric space heating in Climate Zones 10-16.
16. Duct testing and sealing appears to be more cost-effective for multi-family dwellings in SDG&E's Zone 15 than it is for single family gas homes in many other areas of the state.
1. This proceeding does not require hearings.
2. The ratemaking treatment of each utility's Low Income Energy Efficiency and CARE funding should not change from the status quo.
3. The utilities should recover in rates a level of Low Income Energy Efficiency and CARE program funding commensurate with the funding we authorize in this decision.
4. We want each utility to establish, and work to achieve, penetration goals (with the assistance of the Needs Assessment results and each utility's direct program experience).
5. We want to bring the utility low income program cycle into sync with that of the more general energy efficiency programs, which are in the midst of a three-year program cycle, scheduled to terminate at the end of 2008.
6. SCE, SDG&E and ORA should work with community and consumer groups, major corporations, government centers and others to develop a low cost plan for reviving the Cool Centers for service in the summer of 2006 and submit it to this Commission for approval, if necessary.
7. We should permit the utilities to rely on the 2001 load impact report as the most recent analysis available.
8. We should grant CARE administrative fund shifting capability for all of the applicant utilities.
9. We should not approve SDG&E's proposal to shift gas low income energy efficiency funds to electric programs, and should direct the company to reapportion the funds, accordingly.
10. We should direct SDG&E to provide duct testing and sealing for multi-family dwellings in Zone 15 within its service territory.
IT IS ORDERED that:
1. Pacific Gas and Electric Company (PG&E), San Diego Gas & Electric Company (SDG&E), Southern California Edison Company (SCE) and Southern California Gas Company (SoCalGas), collectively referred to as the utilities, shall immediately offer qualifying low income customers all Low Income Energy Efficiency measures set forth in their respective 2006-2007 applications and the proposed new measures for 2006 (as approved in this order), until further Commission order.
2. The utilities are authorized to recover in rates the amounts shown below in Tables 1 and 2 for Low Income Energy Efficiency and California Alternate Rates for Energy (CARE) activities.
TABLE 1 | ||||
2006 AUTHORIZED CARE BUDGETS | ||||
PG&E |
SCE |
SoCalGas |
SDG&E | |
Outreach |
$4,837,000 |
$1,633,000 |
$1,949,750 |
$1,187,014 |
Automatic Enrollment |
150,000 |
60,000 |
30,000 |
21,200 |
Cool Centers |
95,000 |
|||
Proc., Certification & Verification |
1,600,000 |
600,000 |
925,334 |
227,269 |
Bill System / Programming |
150,000 |
557,000 |
265,045 |
72,800 |
Measurement & Evaluation |
150,000 |
58,000 |
393,560 |
235,700 |
Regulatory Compliance |
170,000 |
50,000 |
163,306 |
123,872 |
General Administration |
300,000 |
1,063,000 |
297,315 |
177,314 |
CPUC Energy Division |
100,000 |
82,000 |
83,000 |
50,000 |
Total CARE Expenses |
$7,457,000 |
$4,199,000 |
$4,108,310 |
$2,346,519 |
Subsidies & Benefits |
$324,612,000 |
$168,100,000 |
75,315,876 |
32,907,285 |
Total Program Costs and Discounts |
$332,069,000 |
$172,299,000 |
$79,424,186 |
$35,253,854 |
TABLE 2 | |||||
2006 AUTHORIZED LOW-INCOME ENERGY EFFICIENCY PROGRAM BUDGETS | |||||
PG&E |
SCE |
SoCalGas |
SDG&E | ||
ENERGY EFFICIENCY |
|||||
Gas Appliances |
$2,386,000 |
$0 |
$8,020,500 |
$1,353,043 | |
Electric Appliances |
19,593,000 |
20,971,520 |
0 |
5,853,536 | |
Weatherization |
15,283,000 |
394,450 |
15,949,814 |
3,135,038 | |
Outreach / Assessment / Marketing |
3,129,000 |
2,817,745 |
4,600,000 |
||
In-Home Energy Education |
3,129,000 |
518,400 |
600,000 |
1,212,466 | |
Education Workshops |
$0 |
420,000 |
132,000 | ||
Energy Efficiency Total |
$43,520,000 |
$24,702,115 |
$29,590,314 |
$11,686,083 | |
LANDLORD CO PAYS |
|||||
Air Conditioner Replacement - Central |
|||||
Air Conditioner Replacement - Room |
$10,000 |
||||
Refrigerator (CoPay) |
100,000 |
||||
Landlord Co Pays Total |
$110,000 |
$0 |
$0 |
||
OTHER PROGRAM ACTIVITIES |
|||||
Training Center |
$400,000 |
20,000 |
325,000 |
||
Inspections |
$3,500,000 |
555, 000 |
1,132,919 |
161,832 | |
Advertising |
15,000 |
281,000 |
404,914 | ||
Measurement & Evaluation (M&E) |
540,000 |
195,000 |
60,000 |
62,250 | |
Regulatory Compliance |
521,000 |
70,000 |
230,000 |
281,043 | |
Other Administration |
7,904,000 |
$1,772,885 |
1,669,642 |
750,972 | |
Other Program Activities Total |
$2,627,885 |
$3,698,561 |
$1,661,011 | ||
Oversight Costs - CPUC Energy Division |
$35,000 |
$70,000 |
$36,000 |
21,000 | |
TOTAL AUTHORIZED LIEE BUDGET |
$56,530,000 |
$27,400,000 |
$33,324,875 |
$13,368,093 | |
3. The utilities shall manage their authorized budgets for 2006 in a manner that accelerates Low Income Energy Efficiency participation and CARE enrollment in Winter 2005-2006, as directed in Decision (D.) 05-10-044 and results in at least 5-10% more homes being treated than originally anticipated when the original applications were filed. If any utility believes it will have to discontinue or reduce its Low Income Energy Efficiency Program during 2006 due to budgetary or other constraints, it shall immediately notify the Energy Division and the assigned Administrative Law Judge (ALJ) in writing and file a budget augmentation application at least 90 days before the funds are needed. In addition, it may file for a budget augmentation as part of its July 2006 applications for 2007-2008 programs.
4. The ratemaking treatment of each utility's Low Income Energy Efficiency and CARE funding shall not change from that authorized in D.05-04-052.
5. The utilities shall file 2007-08 funding applications no later than July 1, 2006. The utilities shall list separately their budgets and program goals for each year and participate in workshops to develop other application and reporting requirements. The utilities shall schedule and conduct workshops within 60 days of filing their applications, and invite the members of the Low Income Oversight Board, ORA, the Energy Division, and the public to attend the workshops. The parties, ORA, the Energy Division and a majority of the Board members may opt to proceed without the workshop(s), but all must agree.
6. The Assigned Commissioner may, for good cause, modify the due dates set forth in this decision.
7. All CARE and Low Income Energy Efficiency funding authorized today, including those funds collected through the public purpose surcharge, is the property of the Commission and not of the utilities. With respect to such funds, the utilities shall serve as collection and remittance agents only and have no beneficial interest whatsoever in the monies. The utilities shall segregate all CARE and Low Income Energy Efficiency funding authorized today from all other utility funds and not use that funding for any purposes other than as provided for in this decision. All CARE and Low Income Energy Efficiency funding authorized in this decision, including funds collected through the public purpose surcharge, are ratepayer funds collected solely for the purpose of deploying the approved CARE and Low Income Energy Efficiency Programs for the benefit of low income customers. The utilities shall remit funds to the persons or entities with whom they enter into contracts or memoranda of understanding, for the performance of the activities authorized by the Commission for the CARE and Low Income Energy Efficiency Programs, within 30 days of the receipt of invoices for the satisfactory completion of those activities.
8. The Standardization Team shall not undertake any new activities unless and until it is authorized to do so as a result of the July 2006 applications, or as otherwise directed by the Assigned Commissioner.
9. We will not formally adopt or approve the results of the 2001 load impact report as the utilities request in this proceeding. Instead, we permit the utilities to rely on the study results on a case-by-case basis, as we do today, until we can address and resolve Low Income Energy Efficiency-related issues in the 2006 Annual Earnings Assessment Proceeding.
10. The utilities may shift funds, as needed, among the CARE administrative activities and Low Income Energy Efficiency Program categories. In the next set of applications, the utilities shall identify and explain any funding shifts that they have made up to that point.
11. To the extent there are remaining carryover funds, the utilities shall use them to increase program activity in 2006. We are expecting that this will result in no funds remaining at the end of 2006. However, if there are remaining funds, the utilities shall continue the existing practice of carrying them forward to the next program year.
12. Each of the utilities shall seek a 2006 budget augmentation, through an application to be filed no later than April 14, 2006.
13. SCE, SDG&E and ORA shall work with community groups and others to develop a low cost plan for reviving the Cool Centers for service in the summer of 2006.
14. SDG&E shall not shift Low Income Energy Efficiency funds from gas to electric programs as proposed in its application.
15. The utilities shall offer duct testing and sealing for single family and mobile homes with gas space heating in all climate zones and for homes with electric space heating in Zones 10-16.
16. SDG&E shall offer duct testing and sealing to qualified multi-family customers in Zone 15 within its service territory.
17. In conjunction with the installation of new furnaces, the utilities shall consistently inspect and seal the ducts, regardless of nature or location of the dwelling involved.
18. The electric utilities shall offer the replacement of inefficient central air conditioners for all three residence types in Zones 14 and 15.
19. The Standardization Team shall consult with the Low Income Oversight Board on all recommendations to be presented to the Commission.
20. The utilities shall utilize the standards and procedures proposed in the November 21, 2005 Standardization Team Report for the new measures approved in this order and for compliance with the Title 24 Building Standards on an interim basis, pending final approval.
21. Application (A.) 05-06-005, A.05-06-009, A.05-06-012 and A.05-06-013 are closed.
This order is effective today.
Dated December 15, 2005, at San Francisco, California.
MICHAEL R. PEEVEY
President
GEOFFREY F. BROWN
SUSAN P. KENNEDY
DIAN M. GRUENEICH
JOHN A. BOHN
Commissioners
