4. Substantial Contribution

As we stated in D.07-11-024, intervenor participation in PRGs, PAGs and other non-traditional forums, such as settlements, present particular challenges for intervenors and the Commission in the context of intervenor compensation:

Some of the work undertaken in such collaborative processes by its nature results in activities, if not analysis and ideas, that overlap with the work of others. Also, Administrative Law Judges do not directly oversee this work and, therefore, cannot make a first-hand assessment of an intervenor's effectiveness and ultimate contributions to a Commission decision. In spite of these challenges, we have sought to provide compensation to intervenors who participate in these groups to the extent such participation is consistent with Public Utilities Code §§ 1801-1812.⁹

In order to compensate intervenor groups, §§ 1801-1812 establish the criteria under which an intervenor may be compensated for participating in Commission proceedings. Most germane to our order today are the following requirements:

The intervenor must demonstrate a "substantial contribution" to the proceeding, through the adoption, in whole or in part, of the intervenor's contention or recommendations by a Commission order or decision. (§§ 1802(i) & 1803(a).)

The customer's participation must not duplicate the presentations of other parties although it may materially supplement, complement, or contribute to the presentation of another party.
(§§ 1801.3(f) & 1802.5.)

"Compensation" means payment for all or part, as determined by the Commission, of reasonable advocate's fees, reasonable expert witness fees, and other reasonable costs of preparation for and participation in a proceeding. (§ 1802(a).)

The statute provides the Commission with latitude on how to implement the provisions of §§ 1801-1812 and the Commission has interpreted the statute to encourage participation in its proceedings. However, we did not intend to forgo an analysis of "substantial contribution" or "reasonableness of the amount requested" when we stated that active participation in PRGs and PAGs makes a significant contribution. Accordingly, to promote the efficient and effective review of intervenor compensation requests that involve PRGs and PAGs, we clarified in D.07-11-024 that compensation requests must include enough information for the Commission to make the findings required by §§ 1801-1812.¹⁰

More specifically, we directed that:

1. To evaluate the reasonableness of the requested compensation, the intervenor should explain the types of programs, policies, practices or documents reviewed in connection with its PRG or PAG work and how that work contributed to an outcome that benefited ratepayers;

2. The intervenor should address how its work added value to the review or advisory process because of the intervenor's unique analysis, perspective or work product or because of specific expertise or skills of the intervenor;

3. The intervenor should adequately describe its contributions to meetings or document review, and distinguish those contributions from other PAG/PRG members, consistent with § 1802.5. The intervenor should also demonstrate reasonable collaboration with other group members to minimize duplication of effort; and

4. The intervenor should provide the date, duration, and location of the PRG or PAG meeting for which compensation is requested and whether the intervenor attended in person or participated telephonically. If more than one member of the intervenor's group attends a meeting, the intervenor should provide justification for the staffing decision.

Finally, we identified the following two types of activities for which we would not compensate intervenors:

In the past, the Commission has reviewed intervenor timesheets which include tasks that might be considered staff work, i.e., work normally conducted under the direction of either a utility or Commission manager, including the implementation of program details according to that manager's discretion. We will not compensate intervenors for this type of work.

Nor will we compensate under the intervenor compensation statute for participation in ad hoc technical review committees that Energy Division may informally convene outside of these groups, as needed, in order to assist in carrying out its ongoing evaluation, measurement and verification (EM&V) responsibilities. In D.05-01-055, we encouraged Energy Division to draw on the experience of the Public Interest Energy Research (PIER) program run by the California Energy Commission (CEC) in creating such committees for its own purposes. Based on the CEC's experience with the PIER ad hoc committees, we concluded that this approach could draw on a pool of EM&V experts in California and other states who are willing and able to provide Energy Division with technical feedback at "very little or no cost" to ratepayers. [Footnote omitted.] Energy Division is currently investigating the payment of per diems to participants in ad hoc technical review committees. However, we do not modify D.05-01-055 to identify this type of participation in energy efficiency implementation activities as eligible for intervenor compensation, as one intervenor has recently suggested in R.06-04-010. [Footnote omitted.]¹¹

In its request for compensation, TURN describes the nature of its participation in the PRGs and PAGs for energy efficiency. Haley Goodson (TURN attorney) and Cynthia Mitchell (consultant to TURN) were selected to represent TURN on PG&E's PAG. Mitchell also represented TURN on PG&E's PRG. In addition, Mitchell was selected as TURN's representative to the SCE/SoCalGas PAG and PRG.

TURN states that its representatives actively participated in each PG&E and SCE/SoCalGas PAG and PRG meeting. In addition, TURN describes how its participation on these advisory groups helped shape the first statewide PAG working group to further explore program options for heating, ventilating and air conditioning (HVAC)¹² and how it led post-meeting follow-up projects. TURN also states that it encouraged the first statewide PAG meeting between the PAGs and utility administrators to discuss various energy efficiency activities and programs at a statewide forum to achieve economies of scale and scope at a state level. In addition, TURN describes how it assisted with the preparation of PRG assessments of the utilities' portfolios, and developed criteria for evaluating whether the proposed portfolios would satisfy near term savings targets. TURN states that its participation also helped with the processing of the utilities' compliance advice letters. Finally, TURN states that it led the PRG compliance phase effort directed at ensuring that the local government partnership "experiment" was given an opportunity to run in a fair and reasonable manner.¹³

By D.05-09-043, we recognized the overall contribution of the PRG and PAG process to our decision approving the overall level of funding and portfolio plans in D.05-09-043. In that decision, we concluded, "By all accounts, the advisory group process established by D.05-01-055 was constructive and collaborative, and based on the filings in these proceedings, has served this Commission well."¹⁴ More recently, we found in D.06-04-005 that input from the PAG and PRG process "substantially shaped the utilities' applications and the Commission's final decision on those applications."¹⁵ Based on TURN's description and documentation of PRG and PAG activities, we conclude that TURN's participation as a member of the energy efficiency PRGs and PAGs during the planning and compliance phases for the 2006-2008 program cycle substantially contributed to the constructive and collaborative input of these groups. In addition to actively contributing to the portfolio and funding review process that led to a full Commission decision in D.05-09-043, TURN's participation on the PRGs substantially contributed to the development of detailed assessments of the utility compliance filings. These assessments were, in turn, appended to the advice letter compliance filings and discussed by ED in its approval of the utilities' compliance plans.¹⁶

However, not all of the hours that TURN includes in its request are eligible for compensation. Under the issue area entitled "Energy Efficiency Portfolio Planning" (EEPP), TURN requests compensation for 106 hours of work by its consultant, Mitchell. Nearly 80 hours of that work was conducted prior to the issuance of D.05-01-055, which authorized the creation of the PRG/PAG groups and subsequent selection of its members by the utilities.¹⁷ Even if this work resulted in documents that TURN subsequently presented to the PRG/PAG group and that were relevant to the issues being discussed in those meetings, we cannot award compensation for work conducted prior to the date in which the PRGs and PAGs were actually authorized by the Commission.

Moreover, the remaining 26 hours listed under EEGA are described as time that Mitchell spent revising and expanding a portfolio analysis she initiated prior to the issuance of D.05-01-055, training an assistant on how to analyze utility data, and conducting general research, such as reviewing the Commission's procurement orders. These activities may well have improved the knowledge base and analytical capability of TURN's consultant in energy efficiency matters, and therefore enhanced her capability to serve as a PRG/PAG member. Nonetheless, we do not believe that such research or training hours are properly charged to ratepayers for TURN's participation as a PRG/PAG advisory group member.

In addition, our review of the hours submitted by TURN for Mitchell's work as both a PRG/PAG representative and as an intervenor in Application (A.) 05-06-004 et al. reveals some duplication. By D.07-12-040, we awarded TURN compensation for its participation in that proceeding as a party in the portfolio planning (Phase 1) and compliance phases for the 2006-2008 energy efficiency program cycle.¹⁸ We compensated TURN for over 150 hours of Goodson's attorney work and 150 hours of Mitchell's work as a technical consultant to TURN, most of which were hours spent on TURN's formal pleadings in Phase 1 and the compliance phase of D.05-09-043. Included in that award were 3.5 hours listed for Mitchell's work on June 4, 2005 described as "review TechMktWorks report." The exact same entry (and same number of hours on the same day) is included in TURN's Request for PRG/PAG work. Since we already authorized compensation for those hours in D.07-12-040, including them in this decision would be duplicative, and therefore we remove them.¹⁹

Even after making the above adjustments, TURN's compensation request is troubling for other reasons. First, it represents an unprecedented number of hours when considered in the context of other Commission awards for PRG/PAG participation. The 1,020 hours of consultant and attorney time for TURN's participation in the PAG/PRG process²⁰ is more than 40% higher than the 571 hours requested by the Natural Resources Defense Council (NRDC) and awarded by the Commission for NRDC's active participation in PRGs/PAGS over the same timeframe.²¹ While we recognize that it is very difficult to assess the relative level of effort or efficiency among advisory group participants by comparing the number of hours requested, the large disparity we observe here suggests to us that TURN's request is excessive.

Moreover, we note that TURN has been a party to this and related proceedings concurrently, with some of the same individuals participating in all dockets. It is very difficult to clearly delineate TURN's PRG/PAG work here from the hours of work that relate to TURN's participation as a formal party in other Commission proceedings. While in both instances we only give compensation for work contributing to Commission decisions, a request for compensation submitted by a party must demonstrate substantial contribution to issues addressed by the Commission in a decision, based on the written pleadings and other formal participation of that party. These requests are then reviewed and evaluated in the context of the Commission's written determinations on each issue. This type of showing (and issue-by-issue review of substantial contribution) is not required in requests for compensation for PRG/PAG participation due to the nature of the PRG/PAG's informal role in advising the utility program administrators during program implementation.

Therefore, we are also concerned that hours claimed by TURN here may represent work more properly submitted by TURN in compensation requests related to its participation in proceedings as a formal party, but for which it may not have been found eligible for intervenor compensation. In particular, we note that TURN was an active party to the 2006 Update of Avoided Costs in R.04-04-025 (2006 Update), which the Commission addressed in D.06-06-063. Among other things, the purpose of the 2006 Update was to (1) correct calculation anomalies in the spreadsheet models ("E3 calculators") that the utilities use to calculate energy efficiency portfolio cost-effectiveness, (2) consider the various options for defining peak demand reductions contained in those models and adopt a definition for energy efficiency performance, (3) identify problems in existing load shape data and in establishing priorities and study scopes for load shape improvements by end uses/measures, and (4) update the interim avoided cost methodology and the E3 calculator to more accurately reflect impact of energy efficiency and other resources on peak/critical peak loads.

TURN representatives attended the multiple 2006 Update workshops that were held from early October 2005, to mid-March 2006, and TURN filed formal comments on March 9, 2006, March 27, 2006 and April 14, 2006.²² Workshop attendance records provided by the assigned ALJ indicate that Mitchell was one of TURN's workshop participants, and TURN's comments were filed by Goodson. We note that TURN prevailed on some issues addressed by D.06-06-063 (e.g., how to adjust avoided costs to better reflect the hourly load shapes for air conditioning end-uses), but not on others (e.g., whether to modify current avoided costs using a combustion-turbine adder or simple capacity adder approach). However, TURN did not seek intervenor compensation for its participation in the 2006 Update, so we have never addressed the issue of whether its participation as a party to that proceeding contributed substantially to the Commission's determinations.²³

Our review of TURN's request indicates instances where hours submitted for TURN's PRG/PAG work clearly overlap with TURN's participation as a party in the 2006 Update workshops. In particular, TURN lists time spent by Mitchell on April 7, 10 and 11, 2006 for statewide PRG/PAG work that are described as "emails & discussions with J. Hirsh. TRC errors E3 calculator." As discussed in D.06-06-063, Hirsch was one of the presenters at the 2006 Update workshops and TURN filed comments on the load factor weighting factors contained in that report on April 14, 2006.²⁴ There are other entries in the timesheets for Cynthia Mitchell over the October 2005 to mid-April time frame that suggest further overlap, as they involve the type of activities that could also be associated with the 2006 Update, such as "HVAC Q1 matrix" discussions or working on "data requests" during the period when TURN was also participating in the 2006 Update workshops as a party and developing its formal comments.

In addition, we are concerned that the hours requested by TURN for Goodson's participation in the PRG/PAG process represent some activities that are beyond the scope of her responsibilities as a PG&E PAG representative. As discussed above, Goodson was selected to represent TURN (in addition to Mitchell) on PG&E's PAG, but was not a representative to the other utility PAGs or any of the PRGs. Mitchell, on the other hand, was selected as TURN's sole representative to the SCE/SoCalGas PAG and served on the PRGs of PG&E and SCE/SoCalGas. However, the description of Goodson's hours include entries such as: "SCE/SCG PRG-review correspondence re: compliance filing and discuss w/CKM," "review SCE PRG compliance phase assessment; email to CKM," "read update re: SCE, SDG&E HVAC program plans," "review and respond to PRG correspondence," "review edits to SCG PRG assessment." In addition, there are entries that suggest that Goodson's time was also spent supervising Mitchell's work, e.g., "review Mitchell's draft sections of SCE/SCG PRG," "review Mitchell work product" and "edit CKM's draft memo to PG&E." We believe that these types of activities are beyond the scope of Goodson's responsibilities as an individual representative to PG&E's PAG, and result in an excessive request for compensable attorney hours.

All things considered, we cannot justify the award amount TURN seeks for its work on the PRG and the PAG. We do not wish to discourage TURN's work in this or any other Commission proceeding and we have generally found TURN's work to be of exceptionally high quality. Moreover, we value TURN's contributions to the energy efficiency portfolios for the period in question, and believe that TURN effectively collaborated with other PRG and PAG members to avoid unnecessary duplication. We nevertheless find TURN's compensation request in this case to be excessive and that it seeks funding for work that is not compensable.

Accordingly, we make the following adjustments to TURN's compensation request: First, we reduce the hours requested for Mitchell by 106 hours and the hours requested by TURN's attorney, Goodson, by 5.75 hours to reflect our determination that none of the hours listed under "EEGA" activities are eligible for compensation. Next, we remove 3.5 hours of work listed for Ms. Mitchell under PAG/PRG statewide activities that we can specifically identify as overlapping with TURN's participation in another proceeding, i.e., the 2006 Update.

Unfortunately, the manner in which TURN has recorded and described the rest of the hours spent by Mitchell and Goodson makes it impossible for us to address our remaining concerns by making deletions to specific "time spent" entries in the timesheets attached to TURN's request. Many of those entries are described too generally for this purpose, e.g., they state that "materials" or "data" were reviewed, meetings or conference calls were held, or "analysis" was performed, but do not describe the purpose or issues addressed by such activities. For some entries, TURN has combined somewhat disjointed activities together, which does not permit us to readily calculate reductions in compensation for some activities, but not others.²⁵ Therefore, we must use our best judgment in adjusting TURN's request further to reflect the additional areas of concern discussed above. In our opinion, based on our overall review and assessment of the timesheets presented in TURN's request, we believe it is reasonable to reduce the hours requested for Goodson and Mitchell by another 15%, or by 24.25 and 128 hours, respectively.²⁶

⁹ D.07-11-024, mimeo., pp. 3-4.

¹⁰ D.07-11-024, mimeo., p. 5.

¹¹ D.07-11-024, mimeo., pp. 6-7.

¹² Referred to as the "HVAC PAGette."

¹³ See TURN Request, pp. 3-5 and TURN Supplement, pp. 3-4.

¹⁴ D.05-09-043, mimeo., p. 95.

¹⁵ D.06-04-005, mimeo., p. 9 (awarding intervenor compensation to the Natural Resources Defense Council for PAG and PRG related work).

¹⁶ Pursuant to D.05-09-043, the utilities filed compliance advice letters instead of applications because each of the PRGs was able to reach consensus with the utilities on their respective compliance plans. ED approved the plans, which were informed by PRG reports and the input from the advisory groups. See: ED Disposition of SCE Advice Letter 1955-E, dated April 18, 2006; ED Disposition of SoCalGas Advice Letter 3588-G, dated April 28, 2006; ED Disposition of PG&E Advice Letters 2704-G/2786-E, 2704-G-A/2786-E-A, dated June 1, 2006.

¹⁷ D.05-01-055 was issued on January 27, 2005. By OP 3, the Commission directed the utilities to "put together the advisory groups....and inform the assigned Commissioner and ALJ by letter of the individuals selected to serve on the Program Advisory Group and Peer Review Groups...."

¹⁸ We also awarded TURN compensation approximately 26 hours in that decision for its substantial contribution to D.06-12-013 addressing a petition to modify the Phase 1 decision, D.05-09-043.

¹⁹ See D.07-12-040, mimeo., pp. 19-20. By letter dated January 9, 2008, TURN submitted supplemental information regarding hours for work related to the Case Management Statement that are referred to in D.07-12-040. TURN has adequately explained to our satisfaction how those hours are non-duplicative.

²⁰ After making the adjustments described above, TURN's request includes 854 hours for Mitchell and 160.25 hours for Goodson (not including time spent on preparing TURN's compensation request).

²¹ By D.06-04-005 and D.07-04-008, we compensated a combined total of 571 hours for NRDC's active participation in the PRG/PAG process through April 2006. As discussed in those decisions, NRDC was represented on all three PRG/PAGs. In that capacity, NRDC attended almost all of the PAG and PRG meetings for each utility as well as many of the PAGette meetings. NRDC also actively participated in the compliance phase activities of the PRGs. (See D.06-04-005, p. 8 and D.07-04-008, pp. 6-7.)

²² See D.06-06-063, mimeo., pp. 12-14.

²³ R.04-04-025 was closed with the issuance of D.07-09-040.

²⁴ D.06-06-063, mimeo., pp. 12-14.

²⁵ For example, the entry under Goodson's timesheet for November 30, 2005 lists 4.25 hours of work for: "PG&E PRG-review LGP correp and discuss w/CKM; SCE/SCG PRG-review correspondence re: compliance filing and discuss w/CKM."

²⁶ 963.5 total hours claimed for Mitchell minus EEPP adjustment of 106 hours claimed in 2004/2005, minus 3.5 hours claimed in 2005 equals: (10-10) 0 hours in 2004, (777.5-(96+3.5)) 678 hours in 2005, and 176 hours in 2006, yields 854 hours. Reducing those hours by 15% yields a total of 576.3 hours in 2005 and 149.6 hours in 2006, for a combined total of 725.9 comparable hours for Mitchell's work.

166 total hours claimed for Goodson (unrelated to preparation of compensation request) minus 5.75 hours claimed in 2005 for EEPP equals: (120.25-5.75) 114.5 hours in 2005 and (45.75-0) 45.75 hours in 2006, yields 160.25 hours. Reducing those hours by 15% yields a total of 97.3 hours in 2005 and 38.9 hours in 2006, for a combined total of 136.2 compensable hours.