(END OF ATTACHMENT 2)

ATTACHMENT 3

Standardization Team's Response to Miscellaneous Issues

Relating to Chapter 7 of the Policy and Procedures Manual

SESCO raises several issues relating to Chapter 7 of the Policy and Procedures Manual. SESCO's comments are reproduced below in italics. The Team's response is as follows:

· Section 7.2.5 "should make provisions for homes in which the utility or other authorized party provides a measure pre-approval." The Team does not consider it necessary to include language on measure pre-approval in this section. If pre-approval is used, it is required to consider a measure feasible.

· Section 7.3.2 "does not specify if the caulking on the first floor of a structure should be on the interior or the exterior." The WIS Manual sets specific criteria for 1) selecting caulking materials, and 2) where caulking can be applied. The WIS Manual allows interior caulking around plumbing and electrical penetrations, which blower door studies indicate are major sources of infiltration.

· Section 7.3.4 "should not forbid ... attic insulation because the inspector may have difficulties in the inspection." The actual wording of the non-feasibility condition in Section 7.3.4 is "an inspector cannot gain safe physical access to all treated areas of the attic." The issue here is not one of convenience, but rather of quality control and safety. Inspections of attic insulation jobs are necessary to ensure that insulation was actually installed, the insulation was installed properly, and that no hazards were created. It is unreasonable to require inspectors to inspect a measure when they cannot gain safe access to the measure.

· Section 7.3.9 should be changed to indicate that "energy efficient faucet aerators may be added unless there are pre-existing energy efficient faucet aerators." The energy savings from replacing a standard aerator with a low-flow aerator are very small and the Team urges the Commission to reject SESCO's suggestion.

· Section 7.3.17 should indicate in which CEC climate zones evaporative coolers will be made available. The Team concurs, and suggests revising the last bullet of Section 7.3.17 to read: "Evaporative coolers are available only in CEC climate zones 2, 3, 4, 5, 9, 10, 11, 12, 13, 14, 15, and 16." Availability of evaporative coolers on a utility service area basis will of course be determined by the CEC climate zones which each service areas encompasses.

· Section 7.3.17 (on evaporative coolers) should indicate "when window/wall units should be installed and when portable units are to be installed." Due to rapid deployment, the Team does not feel that it is necessary to restrict installation to specific types of evaporative coolers in individual circumstances at this time. The more general question of the relative efficacy of window/wall evaporative coolers and portable evaporative units should be considered in the more general process of LIEE Program measure assessment.

· Section 7.3.19, "the comparability of refrigerator sizing... should be better defined." The Team's intent was that specific sizing requirements would be covered in contractor training sessions. However, the Team agrees that this policy should be clarified. We propose to use the following language: "The replacement refrigerator shall be equal to or larger than the existing unit, not to exceed 19 cubic feet. However, when two refrigerators and/or freezers are exchanged for a single unit, the replacement unit may be larger than the larger of the two existing units, provided that the new unit is no larger than 23 cubic feet."

· Some priority should be established among evaporative coolers, air conditioners, and whole house fans. This is done to some extent in Appendix D, which deals with rapid deployment measures like high efficiency air conditioners and whole house fans. Sections D.2.2 and D.3.4 indicate that "air conditioners should be replaced only in climate areas not covered by the evaporative cooler program, or where temperatures regularly exceed 100 degrees during the summer months." This language was taken directly from D.01-05-033 (OP 12). Section D.8.2 of the Policies and Procedures Manual indicates: The Team's recommended Policies and Procedures Manual, does not prohibit the installation of both high efficiency air conditioners and evaporative coolers in those climate zones where both are eligible. The Team does not propose any priorities other than those detailed in D.01-05-033.

· Evaporative cooler maintenance should be allowed "only in those areas where evaporative coolers are allowed to be installed." The Team does not feel that this restriction is necessary. If an existing evaporative cooler is present, regardless of climate zone, it will use less energy if it is maintained properly than if it is not. The question is not the efficacy of the customer's initial acquisition of the evaporative cooler, but rather the energy savings that can be achieved through maintenance. Note that, per Section D.9.2, non-operational units will be replaced only in CEC climate zones where evaporative coolers are eligible.

(END OF ATTACHMENT 3)

Attachment 4

Non-Energy Benefits Quantified By The Reporting

Requirements Manual Working Group

Table 1 Benefits categories considered for LIPPT

Benefit Category and description	Included or excluded in LIPPT
Utility benefits
Reduced Carrying Cost on Arrearages (7A) valued in terms of the cost to the utility	Included
Lower Bad Debt Written Off (7B) valued at utility costs	Included
Fewer shutoffs (7C) valued at utility costs	Included
Fewer reconnects (7D) valued at utility costs	Included
Fewer notices (7E) valued at utility costs	Included
Fewer customer calls (7F) valued at utility costs	Included
Lower collection costs (7G) valued at utility costs	Not included because separate data were not available
Reduction in gas emergency calls (7H) valued at utility costs	Included
Insurance savings	Not included to avoid double counting and because data weren't available
Transmission and/or Distribution savings (7J)	Excluded because the energy savings computations used in the LIPPT test incorporate these benefits
Reduced Subsidy (7K) valued at utility and ratepayer savings	Included
Societal benefits
Economic Impacts (8A) measured in state- or public benefits terms	Not included because supporting data were unreliable
Emissions / environmental Impacts (8B) measured in public benefits terms	Excluded because the avoided cost used in the energy savings computations for the LIPPT test include this benefit.
Health and Safety Benefits (8C) valued at amortized installation cost	Included, but zero value because no H&S measures are included in the LIEE program.
Water and Wastewater savings (8D) valued at avoided societal costs	Included conceptually, but zero value because of short life.
Participant benefits
Program incentives	Included, if applicable
Participant Water and wastewater bill savings (9A)	Included
Participant value from fewer shutoffs (9B)	Included
Participant value from fewer calls to the utility valued as time savings (9C)	Included
Fewer reconnects (9D) valued in saved time and costs for participants	Included
Property value benefits from program-provided home repairs (9E)	Included
Fewer fire losses to participants and society (9F)	Included

Fewer health-related expenses from health and safety improvements (9G)	Included, but zero value because no health and safety measures are included in the default LIEE programs.
Participant savings from fewer moves (9H)	Included
Fewer lost sick days from work (9I)	Included
Reduced transactions costs (9J)	Excluded because underlying data weak
Improved comfort, noise, and similar benefits to participants (9K)	Included
Reduced other hardship benefits - control over bill and energy use (9K)	Included

Determining Benefit Values

The determinations of benefit values were made using several different techniques as appropriate for each benefit. In the development of the test, the Subcommittee discussed how to value energy benefits: at retail costs to the participant or at avoided costs to the utilities. The Subcommittee decided that the energy benefits or energy savings should be counted at the avoided costs to the utility rather than the value of the savings to the participant because this is the value that is most reflective of the societal value for conserved energy. The non-energy benefits would be valued in one of three ways.

In the first method the utilities were each asked to provide data on costs associated with billing, arrearage, debt, connects, disconnects and costs associated with customer interactions. For the utility benefits associated with LIEE programs the calculated value of the benefit used in the test are derived from these utility-specific cost data. The benefits included in this report are average, state-wide benefits derived from all four utility's data. Upon use of the LIPPT model, utility-specific data will be used. The level of non-energy utility-associated impact for a LIEE program is estimated using program evaluations and estimations focusing on specific benefits and the expected occurrence of the benefit in a LIEE program. These impact estimations were then projected for California LIEE programs by using the best estimated results from the evaluation studies reviewed in the first two month of the project. These estimated incidences of the benefit are multiplied by the cost of the benefits as calculated using the utility-specific cost data.

The second method was used to calculate non-energy benefits when actual cost or savings values were not available from the utilities. For these benefits the consultants used estimates of benefit values as reported in the literature for low-income or residential programs. In many cases the search found a wide range of benefit estimations in the literature and the consultants were tasked to identify a study or estimation method that could conservatively be equated to California's low income program benefits. The calculation methods and the source of the benefit estimations are included in the program report and in the working model of the test.

The third method for valuing benefits primarily applied to participant benefits that could not be quantified through the literature or through utility cost data. These benefits include comfort, hardship and similar benefits associated with participation. For estimating these benefit values the consultants conducted a survey of California low-income program participants and asked them to give a monitory value that they would be willing to pay for the increased comfort or the reduced hardship associated with program participation. These benefits and benefit values are detailed later in this project report and in the Excel model and range from a low of a negative $12.62 per participant for the added hassles associated with participation to a high of $31.67 per year per household for their increased comfort as a result of the installed measures.

The values associated with specific NEBs using these methods are reflected in the following tables and provide an estimation of the expected benefits associated with an imaginary LIEE program implemented in California. Actual values will be different for each program.

Table 2 Example of utility non-energy benefits

Utility-Related Benefits: Benefits Valued At Utility Costs And Savings
		Annualized Benefits per Participant	Horizon for Benefit (in years)
7A	Reduced Carrying Cost on Arrearages (interest)	$3.76	10
7B	Lower Bad Debt Written Off	$0.48	10
7C	Fewer Shutoffs	$0.05	10
7D	Fewer Reconnects	$0.02	10
7E	Fewer Notices	$1.49	10
7F	Fewer Customer Calls	$1.58	10
7G	Lower Collection Costs	$0.00	10
7H	Red'n in emergency gas service calls	$0.07	10
7I	Utility Health & Safety - Insurance savings only	$0.00	10
7J	Transmission and/or distribution savings (distribution only)	$0.00	10
7K	Utility Rate Subsidy Avoided (CARE) payments	$2.77	10
	Subtotal	$10.22

Table 3 Example of societal non-energy benefits

Societal / Public Benefits: Benefits Beyond Utility And Participants
	NEB Category	Annualized Benefits per Participant	Horizon for Benefit (in years)
8A	Economic impact (direct and indirect employment)	$0.00	1
8B	Emissions / Environmental	$0.00	10
8C	Health and Safety Equipment (CO and Other H&S)	$0.00	7
8D	Water and wastewater (avoided)	$0.00	3
	Subtotal	$0.00

Table 4 Example of participant non-energy benefits

Participant Benefits: Benefits Accruing To And Valued At Participant Values And Costs
		Annualized Benefits per Participant	Horizon for Benefit (in years)
	Program rebate (directly from assumptions above)	$0.00	1
9A	Water/sewer savings	$5.65	3
9B	Fewer shutoffs	$0.17	3
9C	Fewer Calls to the utility	$0.18	10
9D	Fewer reconnects	$0.08	10
9E	Property value benefits	$17.80	10
9F	Fewer fires	$2.44	10
9G	Indoor Air quality (CO-related)	$0.00	7
9H	Moving costs / mobility	$1.30	10
9I	Fewer Illnesses and lost days from work/school	$3.78	10
9J	Reduced transactions costs (limited measures)	$0.00	0
9K	Net Household Benefits from Comfort, Noise, net of negatives	$6.44	10
9K	Net Household Benefits from Additional Hardship Benefits	$2.57	10
	Subtotal	$40.41

Table 5 Summary example of net present value for non-energy benefits

Summary Of All Non-Energy Benefits
	Annualized Benefits per Participant	Net Present Value of Benefits
Utility-Related NEBs: Benefits Valued at Utility-avoided Costs, Savings, or Values	$10.22	$368,460
Societal/Public NEBs: Benefits beyond those accruing to Utility or Participants	$0.00	$0
Participant NEBs: Benefits to Participants, Valued at Participant Costs and Values	$40.41	$1,456,291
Sum of Non-Energy Benefits (NEBs) Valued from All Perspectives	$50.63	$1,824,751