10. 10-Year Go-Back Rule

10.1. Introduction

In the past, and with certain exceptions, the Commission has limited customers from participating in the LIEE program more than once in a 10-year period.⁷⁵ This rule, called the "10-year go back rule" was designed "to promote equity (e.g., continuing expansion of dwellings previously not provided LIEE measures), considering the utilities' constrained budgets."⁷⁶

Noting that we planned to increase LIEE budgets substantially in the 2009-11 timeframe, we decided in D.07-12-051 we should examine whether to modify or eliminate the 10-year go back rule for the 2009-11 program period and thereafter.⁷⁷ We asked the IOUs to address how to do so in their budget applications in a way that avoids duplicative installations and promotes the installation of new measures and technologies in all households.

10.2. Parties' Proposals

The IOUs do not propose to eliminate the 10-year go back rule. Instead, they recommend modifying the rule by making specific changes to Section 2.8 ("Previous Program Participation") in the 2006 LIEE P&P Manual. Under their proposed modifications, the utilities would be allowed to return to previously treated homes in the following circumstances:

· New cost effective measures or technologies are available through the LIEE program. Such measures were not available when the home was originally treated.

· A key program eligibility requirement makes a customer eligible for measures not offered when the utility originally treated the home.

PG&E supports this modification to the 10-year go back rule for the purpose of potentially replacing more refrigerators through the LIEE program. Under the current rules, a customer must have a working refrigerator manufactured before 1993 in order to qualify for a replacement refrigerator under the LIEE program. PG&E states that the refrigerator degradation study proposed by the IOUs may reveal that energy savings from refrigerators trail off in less time than the current program assumes. If the study produces this result and the Commission adopts a new, shorter, time frame for refrigerator replacement, the modification of the "go-back" provision would allow previously treated customers who were denied refrigerators to receive this measure under the new criteria. PG&E notes that a program that emphasizes refrigerators follows the Commission's guidance that the IOUs' LIEE programs focus on long term and enduring savings in D.07-12-051 rather than on measures that deliver only short-term energy savings.⁷⁸

PG&E also suggests modifying the 10-year go back rule by treating qualifying homes that have not been treated by either LIEE or LIHEAP since 2002. PG&E reasoned that in 2001, the Commission implemented a "Rapid Deployment" strategy that increased the number of measures each customer received, and that the IOUs have introduced only a few new measures since 2002. Thus, if IOUs are allowed to re-treat customers who received LIEE services prior to 2002, they will be installing significant measures.

SCE claims that the proposed modifications would give the utilities full flexibility to return to previously treated homes and provide these homes with cost effective measures. SCE specifically supports the modification to Section 2.8 for the purposes of replacing refrigerators or central air conditioners, both of which would result in long term and enduring energy savings.

According to SDG&E and SoCalGas, the proposed recommendations to Section 2.8 would result in increased energy savings and bill savings for low income customers. They present specific examples of how the recommended revisions would impact program delivery. Accordingly, a utility would return to a home treated in the last 10 years under the following circumstances:

· Introduction of new cost effective measures/technologies into the LIEE program

· Modification in program guidelines, such as the changes in requirements for refrigerator replacement

· Change in household occupancy from a low energy user to a high energy user, leading to the need for one or more cost effective measures

· Change in household occupancy to a new tenant willing to have a measure installed that was refused by the prior resident and

· Air conditioning system was previously non-operational and has been repaired by the owner, making it eligible for replacement

LIF supports the modification of the 10-year go back rule, stating that homes should be served with greater frequency because rapid deterioration of low income housing stock makes such measures needed more often. LIF explains that low income households tend to have large families, placing greater wear and tear upon the measures offered through the LIEE program.

10.3. Discussion

We agree generally with the IOUs' proposals and modify the go back rule to allow IOUs to go back and treat customers⁷⁹ who have not received measures since 2002, when the measure mix became far more robust.⁸⁰ In D.01-05-033, the Commission added new measures to the LIEE program, beginning in 2002. Therefore, any customer served since 2002 will have received up-to-date LIEE treatment for the most part while those served prior to 2002 may be in need of energy efficiency upgrades. The proposal to "go back" to households treated prior to 2002 also makes sense in light of the methodology employed to calculate the eligible and willing LIEE population. In this methodology, all customers treated prior to 2002 are deemed as eligible participants.

Though we direct that IOUs to treat customers served prior to 2002, we stress that the IOUs should first seek out new households that have not yet been treated. In making this recommendation, we wish to ensure equity among the low income population. Moreover, energy efficiency retrofits should be targeted to customers with the greatest need for energy savings. For the purposes of achieving the greatest energy savings in the shortest period of time, it is imperative that new customers be enrolled in the program. These previously untreated households are more likely to have pressing energy needs, such as energy burden and insecurity. In their annual reports, IOUs should distinguish between customers treated as "go backs" and brand new customers so the Commission has a clear idea of how many new customers the IOUs are adding to the LIEE program.

⁷⁵ Under the P&P Manual, certain restrictions apply to homes that have been previously treated under the LIEE program. Under Section 2.8 of the Manual, homes that have participated in the LIEE Program within the last 10 years are generally not eligible for services. See also D.01-03-028, OP 1 and Attachment 3, and D.01-12-020, OP 5.

⁷⁶ D.07-12-051, p. 53.

⁷⁷ Id. p. 54.

⁷⁸ Id. p. 91.

⁷⁹ In this section, the use of the term "customer" or "household" refers to a specific premises or dwelling.

⁸⁰ In this section, when we refer to treating a customer or household, we mean treating a dwelling (home, apartment, etc.). In other words, the modification we make to the 10 year go back rule applies to a physical structure.