ALJ/TJS/jt2 Date of Issuance 11/16/2011
Decision 11-11-002 November 10, 2011
BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA
In the Matter of the Application of Southern California Edison Company (U338E) for Summer Discount Plan Program. |
Application 10-06-017 (Filed June 30, 2010) |
DECISION AUTHORIZING MODIFICATIONS TO THE SUMMER DISCOUNT PLAN OF SOUTHERN CALIFORNIA EDISON COMPANY
TABLE OF CONTENTS
Title Page
DECISION AUTHORIZING MODIFICATIONS TO THE SUMMER DISCOUNT PLAN OF SOUTHERN CALIFORNIA EDISON COMPANY 22
2. Background: Proceeding Arose from Decision 10-06-034, which Adopted a Settlement Resolving Issues that Led to the "Double Purchase" of Power to Meet Resource Adequacy Standards 33
2.2. Statutory Provisions Most Relevant to this Proceeding 88
3. The Current SDP Program and the Proposed Modifications 99
4. Issues Before the Commission 1313
5. Discussion and Analysis 1414
5.1. Proposed Changes to the SDP Program 1515
5.2. Program Scale, Costs and Cost Recovery for SDP 2222
5.3. SDP Program - Costs and Benefits 2929
5.4. Timing of Program Changes and Subsequent Evaluation 3232
7. Comments on Proposed Decision 3535
7.1. Comments of Parties and Discussion 3636
DECISION AUTHORIZING MODIFICATIONS TO THE SUMMER DISCOUNT PLAN OF SOUTHERN CALIFORNIA EDISON COMPANY
1. Summary
This decision grants authority to the Southern California Edison Company (SCE) to revise its Summer Discount Plan (SDP), which provides residential electricity users who permit SCE to curtail power to air conditioners with reductions to their bills. The authorized revisions will enable SCE to use the SDP as a full price-responsive demand side resource that it can bid into the California Independent System Operator's (CAISO) markets for dispatch. As revised, the SDP will transition from a rarely-used emergency program to a frequently-used price-responsive Demand Response program. In addition, the revisions to the SDP will enable the CAISO to use this asset in a way that avoids the purchase of redundant supply-side electricity resources.
Pub. Util. Code § 454.5(b)(9)(C) requires that an electrical corporation first meet its unmet resource needs through available energy efficiency and demand reduction resources that are cost effective, reliable, and feasible. This statutory requirement, known as the "loading order," calls for the use of cost-effective demand-side resources before seeking supply side resources. The revised SDP complies with these policies.
In addition, the revised SDP fulfills the terms of a settlement agreement adopted in Decision 10-06-034 in which parties agreed that SCE would introduce a price-responsive option into its SDP.
To avoid customer attrition in this program, in which 330,000 residential customers of SCE currently participate, the revised SDP continues incentive payments to residential customers at current levels and permits customers to obtain from SCE a new switch that affords the option to "override" a limited number of service disruptions. This decision authorizes incremental funding of $26.6 million to the SDP to make these changes and to inform customers.
Despite the increase in authorized costs, SCE projects that benefits will continue to exceed costs. To manage any uncertainties associated with the projected benefits and costs, this decision adopts the Division of Ratepayer Advocates' recommendation that the Commission order SCE to file updated information on this program following the summer of 2012 to ensure that the program continues to produce benefits in excess of costs. This updated information can permit subsequent program modifications, if needed, to ensure that this program remains cost-effective in the face of the uncertain customer response to these many changes.
