4. Beginning the Examination
To begin its examination, the Commission invites discussion on the following themes surrounding rate design. The Commission will hold a workshop in advance of comments to discuss and refine these preliminary questions and will thereafter, by Assigned Commissioner's Ruling, file and serve a list of questions for comment. The preliminary set of questions is as follows:
1) As described in Section 2.6, the Commission defines an optimal rate design as encompassing several guiding principles. Are these the right goals to develop an optimal rate design? Are there other goals that should guide residential rate design? Please describe an optimal residential rate design structure based on those goals. For purposes of this exercise, assume that there are no legislative restrictions. Explain how your proposed rate design meets each goal and compare the performance of your rate in meeting each goal to current rate design. If your proposed rate does not rely on baselines and tiers, explain how low-income customers and customers with medical needs requiring a certain amount of electricity consumption would continue to have their basic needs met at an affordable cost. What barriers, legal or legislative, are in place that would hinder the implementation of the rate design?
2) Would your proposed rate structure produce any
cross-subsidies between coastal and inland customers? How do you define cross-subsidies in this context?3) Do existing CARE methodologies provide for an optimal rate protection or are there more efficient and equitable means to protect low income customers?
4) Can baselines and tiers be made compatible with a
time-variant or dynamic rate structure, or are revisions to existing legislation necessary?5) Are current rate structures compatible with innovative technologies that can help customers reduce consumption or shift consumption to a lower cost time period as compared to time varying rates; and
6) Are there other issues not raised by the preceding list that should be considered in this rulemaking?
Finally, there are many Commission proceedings currently examining the transition to time-variant and dynamic rates for residential customers and the dynamic rates themselves. In light of this, the Commission seeks comment on the following:
7) Is there a need to better coordinate between the dynamic pricing proceedings;
8) What needs to be harmonized between the proceedings;
9) Should any of these proceedings be suspended, consolidated, or dismissed pending the resolution of this rulemaking?
10) What policies would help ensure that successful strategies will be shared between utilities; and
11) Is there a need to better coordinate and advance the role of third party vendors and service providers to bring value to enhancing customers' ability to maximize energy savings under time-variant and dynamic rates?
The issues identified above are best resolved by a formal rulemaking. The results of this Order Instituting Rulemaking (OIR) may have important effects on California IOU customers. Accordingly, we desire that this order be distributed to a wide range of potentially interested parties. We will seek workshop participation, and subsequently, comments from all parties to this rulemaking.
After initial service of this order, interested persons and entities shall advise the Commission's Process Office of their interest in participating, as described in Section 6, so a new service list can be developed for this rulemaking. The assigned Commissioner, and the assigned Administrative Law Judge (ALJ) acting with the assigned Commissioner's concurrence, will have ongoing oversight of the service list and may institute changes to the service list or the procedures governing it as necessary.
