4. Summary of Parties' General Comments on Staff Proposal

Comments on the Staff Proposal were filed on March 7, 2012 by 27 sets of parties. They are: Advanced Energy Economy (AEE); Agricultural Energy Consumers Association (AECA) and Sustainable Conservation; Altergy Systems (Altergy); Bay Area Biosolids to Energy Coalition (BAB2E); California Building Industry Association (CBIA); California Clean Distributed Generation Coalition (CCDC); California Farm Bureau Federation (CFBF); California Energy Efficiency Industry Council (Efficiency Council); California Large Energy Consumers Association (CLECA); Californians for Clean Energy and Jobs (CCEJ); Coalition of Energy Users (CEU); CALSTART; Center for Biological Diversity (CBD); Consumer Federation of California (CFC); Division of Ratepayer Advocates (DRA); Joint comments of the Black Economic Council, National Asian American Coalition, and the Latin Business Chamber of Greater Los Angeles; Joint comments of the Green Power Institute, the California Biomass Energy Alliance, the California Forestry Association, and Wheelabrator Technologies (Joint Biomass Parties); Joint comments of the Natural Resources Defense Council, the Union of Concerned Scientists, the Vote Solar Initiative, Sierra Club California, The Nature Conservancy, and the Ella Baker Center for Human Rights (Joint Environmental Groups); Joint comments of the Pacific Forest Trust and Watershed Research & Training Center (PFT/WRTC); Marin Energy Authority (MEA); PG&E; SDG&E; Solar Energy Industries Association (SEIA); SCE; The Utility Reform Network (TURN); University of California; and Waste Management.

Reply comments were filed on March 16, 2012 by 16 sets of parties. They are: Joint reply comments of AECA and Sustainable Conservation; Altergy; Joint reply comments of the Black Economic Council, National Asian American Coalition, and the Latino Business Chamber of Greater Los Angeles; CBD; Center for Energy Efficiency and Renewable Technologies (CEERT); CFC; Joint reply comments of the Joint Biomass Parties; MEA; Joint reply comments of the Joint Environmental Groups; PFT; PG&E; Republic Solar Highways LLC (Solar Highways); SCE; SDG&E; SEIA; and TURN.

Many parties support the basic policy rationale for funding and supporting public purpose activities in the electricity industry. AEE, the Joint Environmental Groups, Efficiency Council, PFT/WRTC, TURN, University of California, and Waste Management all generally support the policy case for ratepayer support and the guiding principles laid out in the staff proposal. CALSTART commented that the Public Interest Energy Research (PIER) program has led to technological breakthroughs in the past and has had direct benefits to ratepayers, and thus similar work should be continued. CCEJ generally supports the staff proposal's treatment of early stage technology development, but suggests additional emphasis on later stages.

A number of other parties oppose the basic rationale for continuing to support public interest electricity investment. CEU opposes the proposed EPIC program in its entirety. They argue that support for renewable technology development is a poor use of funds as demonstrated by the high-profile failure of the U.S. Department of Energy (DOE) loan guarantee program, including funds that went to Solyndra. CEU also characterizes a 2011 letter to Senator Alex Padilla from the LAO⁴ as criticizing the overall value of the PIER program. Further, CEU argues that the high electricity costs in California, to which programs like EPIC contribute, create a drag on the California economy, prevent businesses from opening, and have led to the loss of manufacturing jobs. Finally, CEU argues that while the renewables portfolio standard (RPS) program creates demand in a technology-agnostic manner, EPIC runs the risk of picking winners, which is at odds with technology neutrality.

CLECA opposes collecting EPIC funds and argues that programs like the RPS make EPIC "superfluous." They advocate funding be discontinued entirely or limited to 2012 only.

All of the electric utilities whose customers would fund the EPIC program also oppose aspects of the staff proposal to varying degrees. PG&E generally supports additional RD&D funding in California but disagrees with the policy construct offered in the staff proposal. Instead, PG&E believes that RD&D should be utility-specific and vary across utility territories, creating utility-specific customer benefits.

SCE goes further, arguing that the Commission may only allow utility-administered RD&D, at a funding level not exceeding the revenue requirement for the RD&D portion of the expired PGC. SCE argues the Commission should reject the staff proposal and refund the EPIC funds already collected.

SDG&E cites the 2011 LAO letter to Senator Padilla as a basis that the CEC programs were not effective. Thus, SDG&E argues that the expiration of the PGC funds does not constitute a gap in successful RD&D activities that needs to be backfilled by EPIC.

⁴ See http://www.lao.ca.gov/reports/2011/rsrc/cec_pier/cec_pier_011811.pdf.