2006-2008 Energy Efficiency Programs
by Patrick Stoner, Local Government Commission
Planning for the next three years of energy efficiency (EE) programs
began earlier this year following the CPUC decision to place administration
of these funds with the investor owned utilities (IOU). Each IOU
set up a program advisory group (PAG), with the exception of Southern
California Edison and Southern
California Gas Company who combined
to share one PAG.
The purpose of the PAGs is to help the IOUs make informed choices
as to the types of EE programs to fund for 2006-08, and which entities
(IOUs, third party contractors, local governments or others) could
best implement them. These groups are only advisory; the IOUs will
be making their own decisions about the programs that they will
file with the CPUC on June 1st.
In addition to the PAGs, peer review groups (PRG) were established
to ensure the PAG process was open and fair, and to make recommendations
to the CPUC on the IOU program filings. PAG members will be allowed
to compete to implement EE programs, PRG members will not. PRG
members include representatives from the CPUC Energy Division,
the Office
of Ratepayer Advocates, the California
Energy Commission,
The
Utility Reform Network (TURN) and the Natural
Resources Defense Council (NRDC).
I have been participating in PG&E's PAG meetings as a representative
of local governments. Much of this update is related to my experience
on that PAG. PG&E's PAG met seven times from February through
April. Several workshops were also convened during that time period,
as well as two statewide PAG meetings. This has been a very open
process, with repeated efforts on the part of PG&E to get feedback
from the PAG and the public on the process, on the materials provided
by PG&E and others to help inform our comments, and on program
ideas.
Between the last PAG meeting and June 1st, PG&E
and the other IOUs will be developing their program portfolio,
identifying the types of programs to include, and in which market
segments they plan to place the most emphasis. PG&E will allow
third parties and local government partnerships to propose programs
in nearly all areas of the portfolio, excluding only upstream (point-of-sale)
lighting and new information-only programs. PG&E plans to complete
its RFP process before determining the exact budget for each program
area. PG&E will compare the top bids with the potential savings
in each market segment to create a well-balanced portfolio that
will maximize savings now and in future years.
I feel confident that PG&E's filing on June 1st will
fairly treat local governments, third parties, and the IOUs. PG&E
has solicited program ideas from current and potential future local
government partnerships for its June 1st filing. I don't
think I will be surprised on June 1st. I cannot speak
for what happened with the other PAGs.
PG&E is looking at creating a new paradigm to develop a least
cost portfolio that budgets for energy savings by market segment
with two key elements – deemed savings and calculated savings.
The deemed savings are for mass-market type programs, and the calculated
savings are for larger projects such as standard offer programs.
The market segments identified by PG&E are:
- Mass Markets
- Agriculture and Food Processes
- Schools and Colleges
- Retail Stores
- Fabrication Process Heavy Industries
- Hi-Tech Facilities
- Medical Facilities
- Office Buildings
- Lodging Facilities
- Residential New Construction
- Education, Training, Codes, and Emerging Technologies
- Statewide Information
Each market will need the following interventions, to different
degrees, to create savings:
- Information, education and training
- Deemed savings
- Calculated savings
Third parties and local government partnerships will be able to
apply to implement each of these intervention strategies for the
various market segments. For third party proposers (at least 20%
of all funding), PG&E envisions having three PG&E staffers
independently score each proposal and provide scoring justification,
having the PRG review the scoring, and allowing the proposers to
question the results. This should make this a very open and fair
process.
PG&E is hoping to start its RFP process shortly after its
June 1st filing, opening up non-controversial program
areas then, and having another RFP release later for areas that
are more controversial. In order to reduce the cost to proposers,
PG&E is also proposing a two-step process that asks for program
ideas, savings and budgets initially, and more detailed proposals
for the highest-ranking ideas. All of this needs CPUC approval.
The work of the PAGs is not over. They will continue to meet on
at least a quarterly basis throughout the three program years.
If you have questions about this process, email me at pstoner@lgc.org and I will either try to answer them or direct you to someone at
the IOUs for information. And be looking for the June 1st filings.
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