9. California Advanced Homes Program

The California Advanced Home Program (CAHP) is described in
D.09-09-047 at 160-161 as follows:

CAHP encourages single and multi-family builders of all production volumes to construct homes that exceed California's 2008 Title 24 energy efficiency standards by a minimum of 15%. In this program, multi-family, single-family, and low-income projects are approached identically. CAHP is proposed as a redesigned program continuation from 2006-2008 and attempts to address some key barriers identified by internal program evaluations. Specifically, the CAHP program proposes to improve the demand for high efficiency homes by assisting builders with marketing efforts and leveraging consumer awareness of "green" products rather than re-educate in terms of efficiency. Further, the CAHP aligns its participant entry point (15% above code) with that of the New Solar Homes Program (NSHP), administered by the California Energy Commission.

D.09-09-047, OPs 24(a) and (b) state:

(a) Pacific Gas and Electric Company, Southern California Edison Company, San Diego Gas & Electric Company, and Southern California Gas Company shall adjust the per-unit (kilowatt-hour, kilowatt, therm) incentive levels within their proposed incentive structure such that the CAHP program provides participants an average of 50% of the incremental measure cost at 20% above Title 24; and

(b) For the CAHP program, Pacific Gas and Electric Company,

Joint IOUs contend it is unclear whether the Decision is meant to apply only to single family units, or to multifamily units as well. Joint IOUs claim that while multifamily units have been eligible for solar electric incentives through NSHP since it was established (July 2007 Standards), the $2,000 per unit NSHP Tier 2 energy efficiency bonus has only been available to single family homes.

Joint IOUs argue that offering the same level of incentive for both single family and multifamily homes introduces considerable free-ridership concerns. The average typical incentive for multifamily homes is much lower than for single family homes, and thus a $1,000 bonus for multifamily homes is disproportionally high. For example, a typical single family home in climate zone (CZ) 10 would earn an incentive of $1,500, or 63% of the incremental measure cost (IMC) at $2,370. A typical multi-family unit in CZ 10 would earn an incentive of $600 or 69% of IMC at $864. Therefore, while adding $1,000 per unit is a bonus of 66% per single-family unit, adding $1,000 per multi-family unit is 166% per multi-family unit or 185% of IMC.

Joint IOUs request that D.09-09-047 be modified to clarify that the $1,000 bonus is to be offered to single family units only. If the Commission adopts a performance bonus for multifamily units, Joint IOUs suggest granting the utilities the latitude to offer a more proportional $200 incentive for multifamily units, or a territory-specific incentive, such as marketing dollars, or customized engineering reports, to more appropriately address this market segment.

DRA/TURN agree that a $1,000 performance bonus for multifamily units appears excessive. DRA/TURN recommend that the performance bonus applies only to single family units, and that the Energy Division work with the utilities to evaluate how to effectively increase the adoption of the CAHP within the multifamily market.

We agree with the parties that D.09-09-047 should be clarified to state that the $1,000 performance bonus applies only to single family units. For multifamily units, we agree with the Joint Utilities' proposal to offer a lower, more proportional, incentive.

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