6. Productivity

D.98-04-059 directed customers to demonstrate productivity by assigning a reasonable dollar value to the benefits of their participation to ratepayers. (D.98-04-059, pp. 34-35.) The costs of a customer's participation should bear a reasonable relationship to the benefits realized through its participation. This showing assists us in determining the overall reasonableness of the request. However, it can be difficult to quantify in dollars the benefit of any one party's involvement in a series of multi-party negotiated settlements where evidentiary hearings were limited to adoption of the settlement agreements. Nonetheless, the Commission has previously recognized that compensation may be appropriate where specific monetary benefits are difficult to establish. (D.05-04-041.)

TURN argues its most obvious impact was on keeping rates lower for residential customers than proposed by PG&E. TURN argued for a 2% revenue allocation cap for residential class average bundled rates instead of 3.9% sought by PG&E. An increase of 2.9% was adopted in the MCRA Settlement. TURN also claims it preserved residential CARE rates at present levels, protected rates for 130% of baseline usage despite escalating costs for solar programs, and ensured that other increases or decreases to residential non-CARE rates would equitably flow to Tiers 3, 4, and 5. The Commission agrees that through its advocacy, TURN played a significant, if difficult to quantify, role in the adopted settlements that affords rate protection to all residential class consumers. Thus, the Commission finds that TURN's efforts have been productive.

TURN also persuaded the Commission that several modifications were needed to the MM Settlement in order to protect the pubic interest, primarily relating to consumer protections for tenants of master-metered commercial office buildings. The focus of TURN's advocacy was for small commercial tenants to have more information and an effective opportunity to efficiently meet their electricity needs. The small commercial class of tenants benefited from the consumer protections advocated by TURN because more efficient use of energy will result in lower bills. Thus, the Commission finds that TURN's efforts have been productive.

VSI advocated a 2% revenue allocation cap for residential and small light and power rates, collection of CSI funds on equal cents/kWh basis, and for changes to residential and small light and power tariffs to send clear price signals to consumers to reduce consumption in peak hours and provide incentives to install solar systems. VSI joined several other parties in advancing the 2% cap and CSI cost issues, but implies its participation was a substantial factor in favorable settlement results on these issues. We disagree and find VSI's efforts to be partially duplicative on these issues as discussed above in Section 5 and, thus, not fully productive. Similarly, we find VSI's efforts to explain problems with the E-6 and E-7 tariffs that reduced incentives to residential customers to install solar systems to be somewhat duplicative of the work of other parties including PV Now and CAL SEIA and, thus, not fully productive.

However, we recognize that VSI's expertise, development of customer witnesses, and participation with all parties in the settlement negotiations likely had a productive impact on the final results which accommodated most of VSI's concerns. As noted above, to the extent rate increases are lower, ratepayers benefit monetarily. Although precise monetary benefits to ratepayers cannot be quantified, the Commission agrees that residential and small light and power consumers will receive substantial benefits as a result of limited rate increases. We agree to the extent that changes in rate design lead to lower energy usage at peak times, ratepayers benefit monetarily by avoiding energy costs. We also agree that more customer-sited solar energy sources will advance the Commission's goals for development of solar and other renewable energy sources as articulated in CSI and the Energy Action Plan. Though hard to quantify, these benefits are substantial to all energy consumers in the long term. Therefore, we find VSI's efforts were productive in part, largely through its efforts with other parties to advance these issues in settlement.

There are two obstacles to consideration of the productivity of AECA's participation in D.07-09-004. The first is discussed above in Section 6.1 where no useful documentation was provided to identify and describe the tasks performed by Steven Moss and Richard McCann of "M-Cubed" for which AECA seeks $19,818.75, or 63.6% of its gross claim for compensation. We lack sufficient information by which to evaluate whether AECA's work was productive as to this amount.

Second, AECA applies a 77.3% compensation factor to claim compensation only for representing those it determined to be "small agricultural customers." To analyze the proper cost-benefit ratio, AECA's total cost of participation must be allocated between its members who are small and large customers. AECA states the 77.3% compensation factor was approved by the Commission in the prior award of intervenor compensation to AECA in D.07-05-048. In that decision, AECA reiterated the position it took in D.06-04-065 where the Commission agreed significant hardship had been shown for individual AECA members with annual electric bills of less than $50,000, or 77.3% of AECA's membership and adjusted compensation in the same proportion. In D.07-05-048, the Commission again agreed that the principle benefits of AECA's efforts went to all members more or less equally and concluded the requested 77.3% allocation was reasonable. However, the Commission also specifically pointed out that where other issues might be involved in a compensation request "[a]n appropriate allocation of costs should be developed for each individual request based on the circumstances surrounding that request." (D.07-05-048 at 13.)

Specifically where electric rates are affected by AECA's participation, consistent with AECA's focus in this request, the Commission stated that members with large electric bills would likely benefit more than members with relatively small electric bills. In such circumstances, benefits presumably flow more to members with larger bills and equal allocation of costs would "likely violate the principle that allocation of costs of participation should be based on the perceived benefits of that participation." (D.07-05-048 at 14.) The Commission directed AECA to fully justify its allocation of costs in future intervenor compensation requests and include an analysis to show which customers face significant financial hardship if they participate in the proceeding and an allocation methodology that "properly aligns the costs of AECA's participation with the benefits of that participation..." (D.07-05-048 at 14-15.)

No such analysis was performed by AECA in this request for compensation despite the fact that the focus of its participation was to generally lower agricultural rates. One possibility is that it may be more appropriate to allocate costs of participation based on the number of members weighted by the size of their annual electric bills. In any event, AECA performed no such analysis in its request for compensation nor in response to a specific request for such made by the ALJ in March 2008. Therefore, the Commission finds that there is insufficient evidence to conclude that any of AECA's costs of participation bear a reasonable relationship to the benefits realized by small agricultural interests.