3. Budget and Program Timeline

Staff recommends a $108.34 million budget for low-income solar incentives for single-family homes, or half of the $216.68 million allocated for low-income incentives in D.06-12-033. The budget would be collected from distribution rates of the three large utilities (i.e., PG&E, SCE, and SDG&E) in the same manner and following the same percentages as the total CSI budget. In other words, the utilities would fund the program as follows:

Table 2
Single-Family Low-Income CSI Program Budget Allocation by Utility

($ in millions)

Utility	PG&E	SCE	SDG&E	Total
Percentage	43.7%	46%	10.3%	100%
Total Budget	$47.34	$49.8	$11.2	$108.34

Further, Staff proposes that to implement the program more quickly, the program should run for only five years, and not through 2016 as in the mainstream CSI program.

Staff proposes the following breakdown for the $108.34 million budgeted for solar incentives to low-income single-family homes:

Table 3

Budget Allocation by Function

Administration	10%
Marketing and Outreach	4%
Evaluation	1%
Incentives	85%

3.1. Parties' Comments

Grid Alternatives and SCE propose that the program run for 10 years, rather than five. According to these parties, a five-year program could compromise the program's effectiveness as the goal will be to spend the money quickly, rather than spending the resources wisely. They contend repairs will be needed first on many low-income homes, which means installation delays.

Grid Alternatives and SCE recommend the Commission budget less than $108 million for single-family low-income solar incentives so that more funds can be used for multi-family low-income homes. SCE comments that single-family homeowners appear to be a very small percentage of the low-income homeowners eligible based on the definitions in Section 2852. SDG&E recommends flexibility to shift funds between single and multi-family incentive programs based on the how the programs evolve. Greenlining recommends that the CSI low-income incentive budget be tripled to adequately serve the needs of California's low-income population.

Most parties supported the budget allocation in Table 3, although Grid Alternatives urges flexibility to allow for additional resources for marketing and outreach if the need arises. A WISH comments that an artificial lower limit on administration may be premature and the Commission should focus on oversight and meeting program goals instead.

3.2. Discussion

We agree with SCE and Grid Alternatives that given potential difficulties of outreach to the appropriate target communities and other aspects of this program, a five-year program timeline may be too abbreviated. We will allow the low-income solar incentive program to operate through December 31, 2015, as set forth in Pub. Util. Code § 2852(c)(3), and any money unspent on January 1, 2016, shall be used for "cost-effective energy efficiency measures in low-income residential housing" as further required by that same code section.

We reject Greenlining's proposal to triple the budget for CSI low-income incentives because we do not want to reduce the funds available for the mainstream program until we have experience with the demand for low-income incentives compared to the demand for incentives in the mainstream CSI program.

We understand the concerns of several parties who caution us to allocate less than 50% of the total low-income budget for single-family owner occupied homes. A multi-family low-income incentive program may require more than $108.34 million. Conversely, new and innovative finance models that particularly suit multi-family buildings could lead to lower needs for state subsidies. Given that we have not yet considered critical aspects of a multi-family low-income incentive program, we will initially allocate $108.34 million for single-family low-income incentives, but we may adjust this after considering the budgetary requirements of a multi-family program in a later Commission order. The Commission may reallocate funding between the multi-family low-income program and the single-family low-income program if participation rates and incentive expenditures indicate that such a reallocation is warranted.

Therefore, we adopt the budget allocations proposed by Staff. Specifically, the single family low-income incentive program will be funded by PG&E, SCE and SDG&E according to the percentages in Table 2 above. The Program Manager shall ensure that total program expenditures in each utility's service area over the duration of the low-income incentive program do not exceed the amounts in Table 2. We also direct the Program Manager to adhere to the budget allocations in Table 3 above, wherein 85% of program dollars will go to incentives, 10% to administration, 4% to marketing and outreach, and 1% to evaluation. These functional budget allocations allow more for administration and marketing and outreach than the mainstream CSI program, consistent with higher administration budgets for the Commission's other low-income programs.