19. Customer Rewards

19.1. Parties' Positions

SDG&E and SoCalGas propose to augment their program delivery to include a customer rewards element. SDG&E will use its proposed comprehensive energy audit program¹⁴⁵ to analyze customer energy usage for the previous 12 months to establish a base level of energy consumption. If, for a consecutive six-month period after LIEE measures are installed, customers achieve and maintain the projected energy savings, SDG&E's LIEE customers will be eligible to receive a customer reward of $37.50 (customers who reduce their energy consumption by 20% or more) or $25 (customers who reduce their energy consumption by 15% to 19%). The rewards will be $20 and $10, respectively, for SoCalGas customers. SoCalGas customers may receive up to two rewards in one year during the first year of program participation.

SDG&E and SoCalGas claim that evaluations of their 2005 20/20 program show that rewards increase energy savings. In the evaluated program, 92,325 households were issued bill credits for reducing their consumption by at least 20% from the previous year. Total MWh reduction for these customers was 70,899. After adjusting for free-riders and for customers who reduced without knowledge of the program or incentive, the net savings attributed to active program participants was 14,994 MWh.

SDG&E and SoCalGas state that a bill credit is the most appropriate reward to offer participating LIEE customers because it will assist customers who may be in arrears on their bill and may also reduce the likelihood of service shut-offs. The IOUs will monitor the success of the program by comparing the estimated energy savings from the measures installed to actual customer energy consumption. After the first year, the IOUs will review the accomplishments of the program and make any modifications to increase the effectiveness of the program.

DRA recommends the Commission approve SDG&E and SoCalGas' rewards program proposal as a component of its LIEE program and recommends that SDG&E and SoCalGas consider expanding its program from homes treated beginning in 2009 to include homes treated before 2009. DRA reasons that this change would make the program more equitable, and provide an excellent means of comparing the impact of LIEE with and without the rewards program.

19.2. Discussion

The Commission grants the request of SDG&E and SoCalGas on a pilot basis. SoCalGas and SDG&E shall monitor the effectiveness of the rewards program and provide in their annual reports due each May details of whether the program has (1) contributed to new customer enrollments or (2) enhanced program energy savings. Their report shall also contain a narrative section candidly explaining the results of the pilot. Once the results of the program are reviewed, the Commission will determine if the program results in the desired behavioral changes and sustained energy savings and will determine at that point whether such a program should be implemented beyond the pilot stage.

¹⁴⁵ SDG&E proposes a customized and detailed energy audit that creates a personalized energy-use profile for each customer that focuses on the needs of the household, will better align the assessment process with the goal of achieving energy savings, reducing greenhouse gas emissions, and lowering customer bills.