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ALJ/DMG/hkr Date of Issuance 12/5/2008

Decision 08-12-016 December 4, 2008

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Southern California Edison Company's Application for Approval of Embedded Energy Efficiency Pilot Programs for 2007-2008.

Application 07-01-024

(Filed January 16, 2007; reopened February 19, 2008)

And Related Matters.

Application 07-01-026

Application 07-01-029

Application 07-01-030

DECISION GRANTING INTERVENOR COMPENSATION AWARDS
TO THE NATURAL RESOURCES DEFENSE COUNCIL
AND THE UTILITY REFORM NETWORK
FOR SUBSTANTIAL CONTRIBUTIONS TO DECISION 07-12-050

TABLE OF CONTENTS

Title Page

DECISION GRANTING INTERVENOR COMPENSATION AWARDS TO THE NATURAL RESOURCES DEFENSE COUNCIL AND THE UTILITY REFORM NETWORK FOR SUBSTANTIAL CONTRIBUTIONS TO DECISION 07-12-050 22

Findings of Fact 3030

Conclusions of Law 3131

ORDER .............................................................................................. 3232

APPENDIX

DECISION GRANTING INTERVENOR COMPENSATION AWARDS
TO THE NATURAL RESOURCES DEFENSE COUNCIL
AND THE UTILITY REFORM NETWORK
FOR SUBSTANTIAL CONTRIBUTIONS TO DECISION 07-12-050

This decision awards $41,430.75 in compensation for Natural Resources Defense Council's substantial contributions during the consolidated proceeding leading to Decision (D.) 07-12-050. This represents a decrease of $22.20 from the amount requested due to disallowance of routine commuting costs.

This decision awards $76,349.76 in compensation for The Utility Reform Network's substantial contributions during the consolidated proceeding leading to D.07-12-050.

1. Background

1.1. Decision (D.) 07-12-050

D.07-12-050 directed the four major energy investor-owned utilities (IOUs or energy utilities) regulated by the Commission to fund and implement a series of water conservation pilot programs. The broad purpose of these pilot programs is to track and examine the potential for embedded energy1 to be saved, cost effectively, through those water conservation programs. The pilot programs therefore include studies and monitoring programs that track the water conservation programs and closely examine the related reduction in energy use associated with those water conservation programs to illustrate the relationship between water savings and associated energy savings.

Ultimately, these pilot programs were designed to yield the base data necessary to set the stage for anticipated future Commission proceedings by enhancing the Commission's understanding of the potential for embedded energy to be saved, cost effectively, through water conservation programs. The decision also directed the Energy Division to oversee and monitor the pilot programs and to conduct several related studies designed to ensure the collection of comprehensive foundational data and to supplement data resulting from the energy utilities' pilot programs. Using the resulting foundational data, the Commission announced its planned future efforts to develop its own cost-effectiveness calculator for water-energy saving measures and programs.

Cumulatively, the energy utilities will spend approximately $6.4 million on these pilot programs. The Commission anticipates that the results of this pilot process will inform later decisions about the incorporation of water conservation efforts in the energy efficiency (EE) programs for 2009-2011 and beyond.

1.2. Procedural History

The instant consolidated docket, which resulted in D.07-12-050, initially arose from the Commission's prior directives in other proceedings. The Commission began explicitly addressing the possibility that energy utilities might pursue demand side resources by targeting potential embedded energy savings in D.05-09-043, the decision addressing the 2006-2008 EE program applications of Pacific Gas and Electric Company (PG&E), Southern California Edison Company (SCE), San Diego Gas & Electric Company (SDG&E), and Southern California Gas Company (SoCalGas) (collectively, the energy utilities).

A few months later, the Commission opened a new EE rulemaking, (R.) 06-04-010, and confirmed that it intended to explore the issue of "counting embedded energy savings associated with water efficiency." A Scoping Memo was issued on May 24, 2006, which determined that it would be prudent to convene workshops and to receive comments. During 2006 and 2007, multiple educational and training workshops were conducted by the Commission to facilitate policy discussions relating to water-embedded energy savings pursuant to the preceding Scoping Memo. Parties likewise filed post-workshop comments and reply comments on issues laid out in the Scoping Memo on July 31, 2006, and August 18, 2006, respectively.

On October 16, 2006, assigned Commissioner Grueneich issued a ruling in R.06-04-010, directing the energy utilities to file applications in January 2007 to propose spending up to $10 million (collectively) on pilot programs designed to study water-embedded energy savings. The energy utilities, potential water utility partners, and other stakeholders then convened the "Water-Energy Consortium," a working group to assist the energy utilities during the fall of 2006 in developing their pilot program proposals.

On January 16, 2007, the energy utilities each filed an application (Application (A.) 07-01-024, A.07-01-026, A.07-01-029, and A.07-01-030) seeking Commission authorization to implement a pilot EE program intended to capture the embedded energy savings associated with water conservation. On January 30, 2007, the Commission held a prehearing conference (PHC), which was followed by three workshops in February and one in May. On June 14, 2007, the energy utilities served supplemental prepared testimony proposing revised pilot programs and supplementing their previous showing. On June 22, 2007, assigned Administrative Law Judge (ALJ) Weissman extended the schedule to allow for additional negotiations between the energy utilities and other parties. Following these negotiations, the energy utilities submitted amended supplemental prepared testimony on July 11, 2007, to address various issues that arose during those negotiations, and parties filed comments and reply comments on July 18, 2007, and July 25, 2007, respectively. On August 1, 2007, a second PHC was held and all parties stipulated to receipt of all of the applicants' proposals and supporting prepared testimony without cross-examination and without responsive testimony.

The assigned ALJ issued a proposed decision on November 15, 2007. Comments were due on December 5, 2007, and reply comments on December 10, 2007. D.07-12-050 closed the proceedings and approved various pilot programs, discussed above, as negotiated by parties and proposed by the energy utilities, with several modifications designed to ensure that pilot programs will yield the comprehensive and practical information needed to determine the ongoing role of water conservation efforts in the energy utilities' EE programs.

1 "Embedded energy" is the amount of energy needed to produce, convey, and treat a given quantity of water.

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