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Investor-Owned Utility LIEE-CARE 2009-2011 Budget Applications

Presentation to the LIOB

San Diego Gas & Electric CompanySouthern California Edison Company

Southern California Gas CompanyPacific Gas and Electric Company

San Diego, CAJune 5, 2008

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Overview

Review of 2009 – 2011 LIEE-CARE Program and Budget Applications Common Utility Proposals SDG&E Application SCG Application SCE Application PG&E Application

Statewide Strategic Plan Update

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Common Proposal: Program Achieves 25% of Programmatic Initiative

Methodology and factors considered to determine estimated number of customers to be served between 2009-2011. Starting Point: Estimated number of eligible

LIEE customers Subtracted from the starting point include:

Number of households served by LIEE 2002 thru 2008 (actuals plus estimate for 2008)

Estimated number of households unwilling to participate (10%)

Number of households served by LIHEAP/DOE 2002 thru 2008 (actuals plus estimate for 2008)

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Common Proposal: Ten Year Rule

The utilities agreed on the following modifications/exceptions to be added to "Section 2.8 Previous Participation" of the LIEE P&P Manual:

New cost effective measures or technologies that were not previously available in the LIEE program at the time the utility treated a home shall be made available for those qualifying customers

In the event a key program eligibility requirement now makes a customer eligible for measures previously not offered at the time the utility treated the home, the utility shall make available those cost effective measures for qualified customers.

This modification gives the utilities full flexibility to return to homes that have been treated in the past and to provide the customers with cost effective measures that were either not available at the time the home was treated, or were not offered due to a condition that has now changed.

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D.07-12-051 directed that a statewide brand be developed for the LIEE program that all utilities would use as a tag line along with each utility’s own LIEE program name.

Utilities are in the process of contracting with an Ad Agency to develop and present several potential:

Statewide program descriptions/taglines Statewide program names

Potential program descriptions and names will be tested in focus groups conducted in all four utility service territories in multiple languages.

The Joint Utilities expect to present a recommendation to the Commission by July 14, 2008.

Common Proposal: Single Statewide Marketing Tagline

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Common Proposal: Measurement and Evaluation (M&E) Studies

Statewide Studies Total Cost

Impact Evaluation of the 2010 LIEE Program

$600,000

Process Evaluation of the 2009 LIEE Program

$250,000

Non-Energy Benefits Study $300,000

Refrigerator Degradation EUL Study*

$200,000

LIEE Household Segmentation Study**

$200,000

Total $1,550,000 * Joint study funded between the three electric utilities: PG&E, SCE and SDG&E. ** Joint study funded between SCE and PG&E.

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SoCalGas & SDG&E

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SoCalGas & SDG&E:Program Goals

SoCalGas & SDG&E proposed audit based, customized approach is primarily designed to:

Focus on the achievement of energy savings Reduce low-income customers’ bills Improve cost effectiveness Address health, comfort and safety issues.

Proposed program is aligned with the Strategic Plan.

To achieve maximum energy savings, the proposed LIEE program puts additional focus on highest energy users, without excluding those eligible customers who have lower energy consumption.

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SoCalGas & SDG&E: Cost Effectiveness

A primary goal is to improve the cost effectiveness of the LIEE program in PY 2009-2011.

Utility Cost Test Modified Participant Test Total Resource Cost TestPY 2008 0.40 0.58 0.31PY 2009 0.60 0.86 0.51PY 2010 0.60 0.86 0.51PY 2011 0.60 0.86 0.51

Ratio of Program Benefits over Program Costs

Utility Cost Test Modified Participant Test Total Resource Cost TestPY 2008 0.23 0.57 0.17PY 2009 0.46 0.86 0.35PY 2010 0.46 0.86 0.35PY 2011 0.46 0.86 0.35

Ratio of Program Benefits over Program Costs

SDG&E

SoCalGas

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SoCalGas & SDG&E: Program Design

Customized Energy Audit Proposed program design provides a

customized and detailed customized energy audit that creates a personalized energy-use profile for each customer.

Plan is to use an audit tool to compare a customer’s usage to that of neighbors with homes of similar size, construction, and occupancy.

Audit tool will include customer usage patterns, appliance information, and other pertinent household information that will help identify the highest savings opportunities.

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SoCalGas & SDG&E: Program Design

Customized Energy Education Proposing to implement a new and innovative

approach to customer energy education. Based on the results of the customized audit, energy education tailored to the individual customer will consist of the following:

Measures to be installed and associated energy savings; Customer-generated goals related to energy use; Potential benefits to the customer and the environment

and economy; Potential improvements to health, comfort, safety, and

quality of life; and Comparison of energy usage patterns of households with

similar characteristics.

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SoCalGas & SDG&E: Program Design

Customer Rewards Designed to reward customers who are able to

consistently maintain a reduction in their overall energy consumption.

This element will analyze customer energy usage after LIEE measures are installed and the energy usage will be compared to the same timeframe during the previous year.

Two Reward levels – Platinum & Gold The Platinum Level Incentive will be awarded to

customers who reduce their energy consumption by 20% or more.

The Gold Level Incentive will be awarded to customers who reduce their energy consumption by 10% to 19%

Customers may receive up to two rewards in one year during the first year of program participation.

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SoCalGas & SDG&E: Program Design

Customer Segmentation Identify those neighborhoods that have a high density of

customers who have a high likelihood of meeting the LIEE program’s eligibility guidelines.

Group the identified potentially eligible customers into tiers based on their household energy usage

To achieve maximum energy savings as soon as possible, usage levels of customers will be prioritize.

The expected number of households within each segment to be reached (PY 2009 – 2011) is approximately:

SoCalGas - 172,000 at or below baseline allowance and 171,000 above baseline allowance

SDG&E - 20,000 high users, 21,000 medium users, 19,000 low users

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SoCalGas & SDG&E: Program Design

Natural Gas Measure MixAt or Below Baseline Above Baseline

Ceiling Insulation Caulking Faucet Aerator Ceiling Insulation Furnace Clean and Tune Duct Testing/SealingFurnace Filter Evaporative Cooler CoverFurnace Repair/Replacement** Faucet AeratorHigh-Efficiency Clothes Washer Furnace Clean and TuneLow Flow Shower Head Furnace FilterMinor Home Repair* Furnace Repair/Replacement**Standing Pilot Change Out*** High-Efficiency Clothes WasherWater Heater Blanket Low Flow Shower HeadShower Start Shower StartWater Heater Pipe Wrap Minor Home Repair

Water Heater Replacement (Tank and Tankless) Standing Pilot Change Out***Caulking Water Heater Replacement (Tank and Tankless)Duct Testing/Sealing Water Heater Blanket Evaporative Cooler Cover Water Heater Pipe Wrap Weather-stripping Weather-stripping

Notes:* Minor Home Repairs are limited to "Repairs Required to Mitigate Catastrophic Envelope Leaks" as defined in Table 6-2 of the 2006 LIEE Statewide Policy and Procedures Manual

** Only available for owner-occupied homes*** Only available for operational furnaces

Blue text SDG&E onlyMeasures shown in Red text are proposed new measures

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SDG&E: Program Design

High Medium Low

Air Conditioner Replacement Air Conditioner Replacement Air Conditioner Replacement

Air Conditioner Tune-up Air Conditioner Tune-up Air Conditioner Tune-up

Compact Fluorescent Lights Compact Fluorescent Lights Compact Fluorescent Lights

Evaporative Cooler Evaporative Cooler Evaporative Cooler

HE Clothes Washer HE Clothes Washer HE Clothes Washer

Interior Hardwired Lighting Interior Hardwired Lighting Interior Hardwired Lighting

LED Night Light LED Night Light LED Night Light

Microwave Microwave Microwave

Porch Light Porch Light Porch Light

Refrigerator Replacement Refrigerator Replacement Refrigerator Replacement

Torchiere Lamps Torchiere Lamps Torchiere Lamps

ELECTRIC MEASURE MIX

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SoCalGas & SDG&E: Marketing Education & Outreach

Customer Segmentation Marketing & Outreach

• Targeted Direct Mail• Cross Promotion• Email Blasts• Canvassing• Advertising• Community Events• Coordination with Local Agencies• Customer Contact Centers• Brochures• Telemarketing• On-Line Request Form

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SoCalGas & SDG&E: Integration & Leveraging

Integration with Energy Efficiency – e.g., Mobile Home, Innovative Outreach and Measure Program. Ltg Exchange, etc

LIHEAP Potential Opportunities Implement a structured referral system Track customer referral in the program database and measures

installed by LIEE or LIHEAP. Provide LIHEAP contractors serving the SoCalGas service territory

access to SoCalGas’ LIEE database Strategic Partnership with Imperial Irrigation District to

provide low income customers in the overlapping service territories those measures offered by each utility

Strategic Partnership with Metropolitan Water District to leverage funds for the direct installation of HE clothes washers.

Cities, local communities & schools– continue to partner with these entities to conduct local events

CSI - coordinate efforts with the SF and MF program administrators to ensure that homes receiving CSI measures have received LIEE measures

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SoCalGas: PilotHE Forced Air Unit Furnace

SoCalGas proposes to offer a natural gas high-efficiency FAU furnace pilot to customers with high space heating needs during the winter season.

The pilot will replace existing, inefficient operational natural gas FAU furnaces with high-efficiency units that have an efficiency rating of at least 92%.

The pilot will be implemented for approximately 250 customers and the installations will occur after the 2008-2009 winter season.

Bill analysis will be used to determine the cost effectiveness for each installation and the results will be evaluated to determine if this potential measure will be offered in upcoming program years to customers with high space heating needs.

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SDG&E: Pilots Smart Meters - IHD & PCT

In Home Display (IHD) pilot - to customers with Smart Meters as part of the energy education process to help customers know their actual energy usage beginning in 2010

Programmable Communicating Thermostat (PCT) pilot - beginning in 2011. PCTs are thermostats that can receive price or electric system reliability signals, and can be programmed by a customer to automatically reduce energy consumption through thermostat set-point adjustments.

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SoCalGas & SDG&E:Proposed LIEE Budgets

Budget 2009 2010 2011Projected Total Budget $53,599,000 $65,849,000 $67,184,000Energy SavingsProjected Therms 2,564,567 3,292,424 3,345,967

Projected C02 Reduction (Tons) 13,494 17,473 17,757 Projected Vehicle Reduction 3,033 3,893 3,957

SoCalGas

Budget 2009 2010 2011Projected Total Budget $21,000,000 $21,000,000 $20,250,000Energy SavingsProjected kWh 8,887,914 8,887,914 8,575,260 Projected Therms 478,745 478,745 452,749 Projected kW 2,010 2,010 1,965

Projected C02 Reduction (Tons) 7,661 7,661 7,365 Projected Vehicle Reduction 1,548 1,548 1,489

SDG&E

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SoCalGas & SDG&ECARE 2009-2011 Application

Propose same residential program requirements for Sub-Metered Two year recertification cycle Anniversary date renewal Fixed Income Recertification

Propose two year recertification cycle for Expanded CARE Facilities Propose to include Section 8 & Public Housing in Categorical

eligibility Continue of four year recertification using probability modeling Expand phone enrollment, 3rd party outreach and leveraging

opportunities Telephone Enrollment

Continuation of Recertification Telephone Enrollment Addition of Inbound Telephone Enrollment

SoCalGas SDG&E

PY 2008 4.7$ 2.8$ PY 2009 6.3$ 2.9$ PY 2010 6.5$ 3.0$ PY 2011 6.6$ 3.1$

CARE Administrative Budgets ($ millions):

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Southern California Edison

2009-2011 Low Income Energy Efficiency Program

Proposal

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Customer Segmentation Mild/Temperate Climates Zones Hot Climate Zones Customers receive all eligible

measures High use customers targeted

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ME&O CARE ZIP7 Data Sharing Mobile Energy Units Energy Education Kits

• Targeted Direct Mail• Cross Promotion• Web-based Enrollment• Media Advertising• Community Events• Coordination with Local Agencies

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Integration with Energy Efficiency

Home Energy Efficiency Rebates (HEER) Multifamily Energy Efficiency Rebate

Program (MFEER) California New Homes Program (CANHP) Comprehensive Mobil Home Program

(CMHP) Home Energy Efficiency Surveys (HEES) Efficient Affordable Housing (EAH) WE&T School Program

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Integration with EE, cont…

Mobil Energy Unit (MEU) Community Language Outreach Program

(CLEO) Energy Leader Partnership (EL) Summer Discount Plan (SDP) Advanced Metering Infrastructure (AMI) Medical Baseline Energy Assistance Fund (EAF)

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SCE Application – Program Budget

Program Year

Homes Budget MWh MW

2009 75,243 $53,594,000 29,605 11.0

2010 75,243 54,783,000 32,992 12.2

2011 73,243 $56,633,000 33,031 12.4

3-Years 225,729

$165,010,000

95,628 35.6

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LIEE Savings & Benefits

Authorized Requested Percent2007-2008 2009-2011 Increase

Treated Customers 44,300 75,200 70%

MWh Savings 21,143 29,221 38%

MW Reduction 5 10 100%

TRC Ratio 0.52 0.55 6%

SCE 2009-11 LIEE Program Annualized Data

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Cost Effective Measure Offering

Cost-effectiveness- First criteria considered in the review of potential measures Efficient lighting Refrigerator replacement Evaporative cooler installation Central air conditioner maintenance Pool pump replacement

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Non-Cost Effective Measures

In evaluating measures that were not cost-effective, SCE was guided by Commission intent to “… continue to authorize funding for measures that serve important social objectives but may not be cost-effective, as long as they serve our primary objective of reducing energy use and promoting other values such as participants’ quality of life

Central Air Conditioners Window/Wall Air Conditioners

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2008 vs 2009LIEE Program Measures

Measure2008

Annual2009-2011

Annual

Refrigerator Replacement 16,900 20,000

Room Air Conditioner Replacement 1,000 850

Evaporative Cooler Installation 6,700 8,000

Central Air Conditioner Replacement 1,750 4,050

Central Heat Pump Installation 200 100

Weatherization 1,350 1,375

Compact Fluorescent Bulbs 194,000 338,000

Torchiere Replacement 425 2,475

Porch Light Fixture Replacement 650 950

Pool Pump Replacement 200 1,250

Duct Testing and Duct Sealing 1,750 4,000

Evaporative Cooler Maintenance 4,000 2,000

HVAC Maintenance 1,500 1,500

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SCE 2009 – 2011 Application 2009-11 Planned Proposal Recommendations:

o Same residential program requirements for sub-metered tenants

Two-year certification for CARE Expanded Programs Probability Model for recertification Multilingual program awareness campaign

• Spanish, Chinese, Korean, Vietnamese, and Cambodian Work with Public Housing Authority and Section 8 agencies

within SCE service territory to incorporate CARE application into agency intake process

Expanded outreach CARE/FERA Administrative Budget Requested

• $4.2 Current 2008 Budget• $5.5 million for PY 2009 • $5.4 million for PY 2010 • $5.5 million for PY 2011

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PG&E’s 2009-2011 Low Income Energy Efficiency and CARE Program Proposals

PG&ELow Income Oversight Board

June 5, 2008San Diego, CA

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2009-2011 LIEE Program

Year  BudgetHomesTreated KW KWH Therms

2007 $75,336,938 63,319 5,410 27,554,191 1,208,300

2009 $112,702,000 80,000 6,504  32,512,129  1,402,511

2010 $152,011,000 110,000 8,933  44,619,059  1,910,284

2011 $157,625,000 110,000 8,949  44,734,832  1,928,930

2009-2011 Total $422,338,000 300,000 24,386 89,386,403 5,241,725

2007 shows actual program results. 2009-2011 results are estimates. Budget includes REACH PLUS.

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2009-2011 LIEE Represents a Significant Program Expansion

Increased families served Increased funding 9 new pilot programs 5 new program studies 2 new measures New segmentation and outreach

approaches New partnerships, leveraging, and

integration opportunities

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2009-2011 LIEE Program Delivery Strategy PG&E will offer the LIEE program through a

multi-layered approach that considers: energy use, climate zone and housing type. This approach makes some less cost‑effective

measures available based on a customer’s electric and/or gas use.

Customers with the highest energy use also offer the greatest opportunity to save energy.

Helps customers: who save money on their bill Helps all California ratepayers: who benefit as

decreases in energy use strengthen the State’s energy resources and decrease GHG emissions.

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LIEE for PG&E Electric CustomersMeasure Low User Medium User High User

Energy Education

Screw in CFL

Interior HWD Light

Occupancy Sensor

Refrigerator

Torchiere

Evaporative Cooler

Window/Wall AC

Exterior HWD Light

Attic Insulation 1

AC Tune-Up

Door Weather-stripping2

Caulking 2

Attic Access Weather-stripping 2

Minor Home Repairs2

Available to all qualifying customers

Maybe available to qualifying customers based on climate zone and/or housing type

Maybe available to customers based on need

1 Attic Insulation - Feasible if the customer cools the home with a Central Air Conditioner.

2 Weatherization - Feasible if the customer’s home is All Electric.

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LIEE for PG&E Gas CustomersMeasure Low User High User

Energy Education

Water Heater Blanket

Low Flow Showerhead

Faucet Aerator

Pipe Insulation

Door Weather-Stripping

Attic Access Weather-Stripping

Attic Insulation

Utility Gaskets

Caulking

Duct Test/Seal

Minor Home Repair

Furnace Repair/Replacement 1

Water Heater Repair/Replacement1

Available to all qualifying customers

Maybe available to qualifying customers based on climate zone and/or housing type

Maybe available to customers based on need

1 Available to qualifying home owners.

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Nine LIEE Pilots Meals on Wheels – Deliver microwaves

to those customers who receive meals and don’t have a microwave (80% more efficient than ovens).

High Efficiency Washing Machines – Deliver high efficiency washing machines to households with 5 or more members. Test the viability of this measure.

Habitat for Humanity – Join with humanitarian home builder and rehab partner to create more energy efficient low-income housing.

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Nine LIEE Pilots (con’t)

City of San Jose – Partnering with City of San Jose’s strong neighborhood initiative program to assist in serving low income customers.

City of San Joaquin (Fresno County) – Partner with City to provide services to low income customers.

Energy Education Workshops – Continue to look for more efficient ways to perform group educations with CBOs.

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Nine LIEE Pilots (con’t) SmartAC – Leverage PG&E’s demand

response programs to educate low-income customers about air conditioning cycling options.

SmartMeter™ – Focus on educating low income customers on the value of AMI and how it can help them lower their utility bills.

Online Training for LIEE Implementation Crews – Explore more efficient training options and reduce crew in-class training time by 50%.

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2009-2011 CARE Program Proposed the same residential program

requirements for Sub-Metered tenants Proposed two-year certification for CARE

Expanded Programs Proposed a survey of customers not

responding to Recertification and Post-Enrollment Verification requests

CARE Administration budgets requested: ($7,732,000 current 2008 budget) $8,761,000 for 2009 $9,216,000 for 2010 $9,521,000 for 2011

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In Conclusion

PG&E’s 2009-2011 LIEE and CARE application represents a thoughtful balancing of: LIEE as an energy resource Cost-effectiveness Increased funding without overburdening

non-Low Income customers Innovation & experimentation Improving available information Retention of valuable program elements Health, Safety and Comfort for LIEE

customers

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PG&E 2009-2011 Low Income Programs Testimony Internet links to PG&E's Application and

Testimony for Approval of the 2009-2011 Low Income Energy Efficiency and CARE Programs and Budget:

Applicationhttps://www.pge.com/regulation/LowIncomeProgPY09-11/Pleadings/PGE/2008/LowIncomeProgPY09-11_Plea_PGE_20080515-01.pdf

Testimonyhttps://www.pge.com/regulation/LowIncomeProgPY09-11/Testimony/PGE/2008/LowIncomeProgPY09-11_Test_PGE_20080515-01.pdf

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California Energy Efficiency Strategic Plan (CEESP):Update of the Low Income Strategies

Presentation to the LIOB

San Diego Gas & Electric CompanySouthern California Edison Company

Southern California Gas CompanyPacific Gas and Electric Company

San Diego, CAJune 5, 2008

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LIEE Strategic Plan Update The California Energy Efficiency Strategic Plan

(CEESP) was filed 6/2/08 ACR from Commissioner Grueneich dated 5/5/08

delayed filing of the CEESP from 5/15 until 6/2/08 CEESP posted online at: http://

www.californiaenergyefficiency.com/index.shtml The LIEE Sector is addressed in Section 2 of

the Plan, along with the Residential Sector Still treated as a unique market sector Places it where belongs and includes low income in

the context of the residential sector

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Six Low Income Strategies Develop customer segmentation to improve

program delivery Pursue collaboration and leveraging of other

programs Integrate LIEE programs with Energy Efficiency

and other demand-side programs Promote the growth of a trained LIEE workforce

by developing LIEE workforce training requirements

Specify and employ program elements that emphasize long-term and enduring energy savings

Specify and deploy Marketing, Education, and Outreach (ME&O) for LIEE program consistent with energy efficiency strategies

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1) Develop customer segmentation to improve program delivery

… increasing the opportunities for program participation and energy savings

1.1: Identify customer sectors or segments using dimensions such as energy use, geographic locations

1.2: Develop and implement a plan to achieve 25% customer participation by 2012

1.3: Improve program delivery

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2) Pursue collaboration and leveraging of other programs

2.1: Increase collaboration and leveraging with other low income programs and services

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3) Integrate LIEE programs with Energy Efficiency and other demand-side programs

3.1: Coordinate and communicate between LIEE, EE and DSM programs to achieve service offerings that are transparent for the customer

3.2: Leverage deployment of advanced metering (AMI) to inform and empower low income customers

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4) Promote the growth of a trained LIEE workforce by developing LIEE workforce training requirements

… aiming training at low income, minority and other disadvantaged communities

4.1: Integration with the Workforce, Education and Training (WE&T) strategy in the CEESP

4.2: Continuation of existing training resources

4.3: Coordination with existing and potential resources for training related to LIEE program needs

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5) Specify and employ program elements that emphasize long-term and enduring energy savings

5.1: Improve customer knowledge on energy and environmental issues and improve their use of energy

5.2: Provide low income customers with measures that result in the most savings in the LIEE program

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6) Specify and deploy ME&O for LIEE program consistent with energy efficiency strategies

6.1: Develop the use of a recognizable and trustworthy Brand/Tagline for California’s Low Income Energy Efficiency

6.2: Market LIEE program using segmentation and social marketing