Energy Efficiency Incentives Proposed Decision Issued

The PUC has issued an energy efficiency Proposed Decision that presents a new regulatory framework for achieving and exceeding the state's energy efficiency goals. This action extends California's commitment to efficiency as the highest priority energy resource in advancing policies to reduce greenhouse gas emissions.

The proposal by Administrative Law Judge Meg Gottstein and PUC Commissioner Dian M. Grueneich, establishes a new system of incentives and penalties to drive investor-owned utilities above and beyond California's 2006-2008 energy savings goals. The new "risk/reward incentive mechanism" provides an estimated return to consumers of over 100 percent on consumer investment in energy efficiency.

The proposed decision outlines potential shareholder earnings and penalties at various levels of energy efficiency performance by California's investor-owned utilities (Pacific Gas and Electric Company, Southern California Edison Company, Southern California Gas Company, and San Diego Gas and Electric). The proposal also explains how ratepayers are guaranteed against financial losses on their investment in energy efficiency and presents estimated levels of net benefits that accrue for consumers. Meeting the Commission's energy efficiency goals for just the current period alone (2006-2008) will reduce global warming pollution by an estimated 3.4 million tons of carbon dioxide in 2008, equivalent to taking about 650,000 cars off the road.

This action builds upon California's landmark policies to advance clean air and energy, such as the Global Warming Solutions Act (Assembly Bill 32), the Low Carbon Fuel Standard (Executive Order S-01-07) and Emissions Performance Standard (Senate Bill 1368), and follows the direction of the state's Energy Action Plan.

The PUC anticipates a vote on this issue at its meeting on September 20, 2007.

• Read the Proposed Decision
• Commissioner Grueneich's Letter to Consumers

To get on the service list for future announcements on this proceeding, go to http://www.cpuc.ca.gov/published/service_lists/sl_index.htm .

This is one of many topics where the Local Government Sustainable Energy Coalition could be representing local governments before the CPUC.

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