6. Single Statewide Marketing, Education and Outreach (ME&O) Program
6.1. Introduction
The IOUs spend significant funds every year marketing various energy efficiency and low income energy efficiency programs with different names, taglines, and target markets. Acknowledging the inefficiency of these disparate approaches, the Plan specifies a single statewide ME&O program that combines low income and non-low income energy efficiency messages, uses a single program name and tagline, and targets all eligible communities.
We anticipate that the lion's share of work to develop this ME&O strategy will take place in the general Energy Efficiency application dockets. Thus, we allow the IOUs approximately one third of their proposed ME&O funding to pursue their own, individual marketing campaigns in 2009. The IOUs shall implement this marketing in coordination with the Plan's work on a single statewide ME&O program. All stakeholders will be invited to participate in the development of this program, and the IOUs will be directly involved. Thus, those IOU personnel involved in developing the single statewide ME&O program shall communicate with the IOUs' LIEE program personnel and ensure that 2009 IOU marketing for the LIEE program is consistent with the direction of the single statewide ME&O program. The IOUs' LIEE program personnel should become actively involved in the development of the statewide ME&O program.
For 2010-11, while we approve the IOUs' requested funding, we do not allow the IOUs to spend the funds on the marketing efforts they propose. Rather, they shall hold this money in reserve so that it forms part of the single statewide ME&O program budget. Once we approve the single statewide ME&O program in our Energy Efficiency proceeding, the IOUs will receive further direction on how to allocate this funding. All parties interested in this issue shall monitor the Energy Efficiency proceeding to understand the nature of and funding for the single statewide ME&O program. To assist parties in the monitoring of the Energy Efficiency proceeding, we will provide notice to those on service list A.08-05-022 concurrently when we provide notice to the Energy Efficiency proceeding service list. We are not disallowing any of the ME&O funds the IOUs request. We are simply asking that the IOUs coordinate their 2009 spending with the ongoing single statewide ME&O program efforts, and 2010-11 funding with the new program.
We also order the IOUs to increase their marketing in low-cost, high impact ethnic and other specialty media as part of their 2009 marketing budgets, using the funding we allocate here. To the extent the 1/3 of funding we allocate from their 2009-11 budgets is insufficient to meet this decision's mandates, the IOUs may seek, by Tier 2 Advice Letter under General Order 96-B, leave to shift funding from other aspects of their LIEE budget into the marketing category.
6.2. Parties' Positions
The IOUs propose approximately46 the following Marketing budgets for the 2009-11 period:
The IOUs also discussed the extent to which their ME&O would focus on marketing in ethnic media, in response to an ALJ ruling on the issue. PG&E had no LIEE ethnic marketing campaign during 2006-08. For CARE, it spent $505,000 in three years. (PG&E also states that it spent $400,000 each year on print advertising in the Pennysaver newspaper/coupon book, but we do not view this as advertising in ethnic media.) PG&E requests $525,000 annually for CARE ethnic marketing for 2009-11.47
SoCalGas appears to have had a fairly comprehensive approach to ethnic media advertising in the 2006-08 period for CARE and LIEE. In 2006, it spent $222,674 on print, radio, and television (although an unspecified amount of this was for the Pennysaver publication, which has no ethnic focus, and $9,675 was for door hangers, which are not media-based efforts). In 2007, it spent $342,034, and in 2008 it spent $305,239 (although $31,200 was for bus advertising, which we subtract as not being media-based). SoCalGas' total expenditure was higher than PG&E's, with a total expenditure of more than $800,000 in ethnic media during the 2006-08 period. It plans to spend approximately $450,000 annually LIEE/CARE on ethnic marketing in 2009-11.48
SDG&E had LIEE and CARE ethnic media expenditures of approximately $325,000 in 2006, and $230,000 in 2007, and more than $300,000 in 2008 (not counting Pennysaver and transit advertising), for a total 2006-08 expenditure of $855,000. It plans to spend about the same amounts annually in 2009-11.49
SCE under-spent its counterparts, spending only $380,975 during 2006-2008 on ethnic media concentrated in the radio and print sectors. It plans to spend approximately $350,000 annually in 2009-11.50
In its August 1, 2008 brief, Greenlining states that ethnic media has the potential to be far more effective in reaching and informing LIEE and CARE eligible populations because media outlets serving low income populations will be more receptive to issues that are important to them. Further, ethnic media can serve readers/viewers in their own languages. Greenlining asks the Commission to order increases in the relevant IOU budgets.
Latino Issues Forum states generally that ME&O should reach ethnic communities, limited English proficient households, immigrants and other hard to reach populations, with a workforce in place to conduct such outreach.51
6.3. Discussion
The Plan concludes individual IOU ME&O budgets lack focus and that a single statewide marketing approach is preferable:
Between 2006 and 2008, California IOU ratepayers will have funded approximately $300 million for public education, marketing, and outreach to support customer demand-side programs. Of this amount, $176 million funds public education and outreach for IOU energy efficiency programs. The majority of these outreach efforts have focused primarily on promoting isolated consumer actions, such as buying solar panels or compact fluorescent lightbulbs, or reducing usage to prevent outages during peak periods. By and large, ME&O messages have lacked the comprehensive focus necessary to engage consumers in adopting energy efficiency as a way of life. While program and service area differentiation of messaging will remain an important aspect of overall ME&O efforts, the launch of a coherent statewide campaign will be instrumental in bringing consumer awareness of the value of energy efficiency to the next level. Accordingly, it is a top-level priority for the next round of efficiency investment.
The CPUC's 2007 October Decision (D.07-10-032) directed that this approach be changed significantly, under Commission direction and oversight, beginning in 2009 in order to better leverage ratepayer ME&O funding for more effective results.52
The Plan states that the Commission anticipates achieving the goal of a single statewide ME&O effort through four strategies:
1. An Energy Efficiency Brand: Creation of an instantly recognized brand for "California Energy Efficiency" with clear delineation of what the brand encompasses.
2. Integrated Marketing: Development of marketing messages that offer bundles of demand side management programs targeted to specific customer groups and delivery of the messages using partnerships with a range of energy efficiency participants, including local governments, retailers and manufacturers.
3. Social Marketing: Use of social marketing techniques to create emotional and intellectual drivers for consumers to make a commitment to change and participate in energy efficiency.
4. Internet-Based Networking: Creation of a web portal that allows energy efficiency practitioners and consumers to exchange information and solutions on implementing energy efficiency programs and measures.53
In the 2009-11 timeframe, the Plan anticipates research on best practices for delivering a ubiquitous LIEE message. We expect to conduct statewide segmentation research, including the low income population and other hard to reach groups, on interests, awareness, and attitudes/perceptions related to energy efficiency and global warming messaging.
We anticipate that the single statewide ME&O program will be comprehensive, and cover all of the areas - and more - currently covered by the IOU ME&O budgets. Thus, for example, we anticipate that the single statewide ME&O program will consist of several "buckets," some large, some small. Representative "buckets" may include the following: (1) Statewide marketing of Energy Efficiency, (2) Statewide marketing of LIEE, (3) Regional marketing of IOUs' own individual programs, (4) Statewide marketing to individual in-language groups, and so on. Thus, the single statewide ME&O program, which will also focus on specific geographic areas and sub-populations around the state, will eventually supplant the IOUs' current ME&O programs.
The IOUs' LIEE program personnel have begun the process of trying to coordinate their program names and taglines. During July 2008, they used a market research company to test various possibilities, and, as of this decision, have recommended the following statewide LIEE name and tagline:
Name: Energy Savings Assistance Program
Tagline: A no-cost energy saving program for qualified renters and homeowners.
The Commission plans to engage marketing professionals and others to develop the statewide ME&O program, and it is premature to decide whether the IOUs' proposal is acceptable. Thus, while we grant all of the IOUs' requested funding, they may only spend the amounts we authorize for 2009, and shall hold the other funding in abeyance and dedicate it to the single statewide ME&O program that we will develop and approve as part of our Energy Efficiency rulemaking.
It is not our intent to hamstring the IOUs in marketing their LIEE programs, either in 2009, while the single statewide ME&O program is being developed, or in 2010-11, after it is in place. We give the IOUs all of their requested funding for 2009, and allow them, if necessary, to increase this 2009 funding by Tier 2 Advice Letter seeking to transfer funds from other aspects of the LIEE program. Further, we grant the IOUs the amounts they have budgeted for marketing in 2010-11, but hold that funding in abeyance until the IOUs, the Commission, and the larger LIEE audience have developed the single statewide ME&O program.
Once that program is in place, we expect to allow the IOUs to use all of the funding they requested, but in a way that is consistent with the single statewide ME&O program. That program will be comprehensive and should give the IOUs ample opportunities to market LIEE and meet all of the mandates of this decision. We just want the IOUs to work smarter with the funding they receive.
Nor will we allow LIEE funding to subsidize the non-low-income aspects of the single statewide ME&O program. The funding we authorize will be used solely for marketing LIEE. We authorize the IOUs their requested LIEE ME&O budgets, subject to the foregoing 1/3-2/3 restriction and the mandate that their ME&O dovetail, where applicable, with the ME&O campaign once it is up and running. To ensure that the IOUs' ME&O and the single statewide ME&O program are coordinated, the IOUs must stay abreast of developments on the ME&O program as part of the general Energy Efficiency proceeding.
Many parties assert, and we agree, that ethnic marketing is a key way of reaching language minorities and communities of color. The amounts the IOUs have spent on ethnic monitoring in the past seem small in comparison to their overall marketing budgets. However, the record contains no guidance as to the amount each IOU should be expected to spend on such marketing. All the record shows is the amounts the IOUs spend, and the relationship of those expenditures to total marketing budgets. We do not, therefore, have a basis to determine the adequacy of the IOUs' ethnic marketing efforts.
However, PG&E's ethnic advertising must add a LIEE component. Beyond that, we cannot assess the adequacy of the IOUs' efforts. Therefore, we allow the IOUs to continue the current level of ethnic marketing (with the exception of PG&E, which shall add ethnic marketing for LIEE), in anticipation that the single statewide ME&O program will have a robust ethnic media component.
46 These numbers are approximate. It is difficult to tell from the IOUs' budget submissions precisely how much they spend on LIEE marketing. We have extracted the figures shown in the table from their budgets, but they also appear to have marketing dollars built into their budgets for installing LIEE measures. We grant their full marketing budgets, subject to the 1/3-2/3 condition set forth in text.
47 Response of Pacific Gas and Electric Company to June 25, 2008 Administrative Law Judge's Ruling Seeking Further Information On Large Investor Owned Utilities' 2009-11 Low income Energy Efficiency/CARE Applications, answer 8.
48 Response Of Southern California Gas Company To The Administrative Law Judge's Second Ruling Seeking Further Information From The Large Investor-Owned Utilities' 2009-2011 Low Income Energy Efficiency/CARE Applications, filed July 7, 2008, answer 8.
49 Response Of San Diego Gas And Electric Company To The Administrative Law Judge's Second Ruling Seeking Further Information From The Large Investor-Owned Utilities' 2009-2011 Low Income Energy Efficiency/Care Applications, filed July 7, 2008, answers 8a-8d & Attachments 3A-3B.
50 Response Of Southern California Edison Company (U 338-E) To The Administrative Law Judge's Second Ruling Seeking Further Information On Large Investor-Owned Utilities' 2009-11 Low Income Energy Efficiency/Care Applications, filed July 7, 2008, answer 8.
51 Comments of Latino Issues Forum on the Investor Owned Utilities' Program and Budget Applications for Low Income Assistance Programs, filed August 1, 2008, p. 5.
52 Plan, p. 83. See also D.07-10-032, p. 57 ("[I]t is time to implement a more strategic use of ratepayer ME&O and training funds....")
53 Plan, p. 84.
