BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

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1 BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA Amended Application of Southern California Edison Company (U 338-E) for Approval of Energy Efficiency Rolling Portfolio Business Plan. Application of San Diego Gas & Electric Company (U 902-M) to adopt Energy Efficiency Rolling Portfolio Business Plan Pursuant to Decision Application of Pacific Gas and Electric Company for Approval of Rolling Portfolio Energy Efficiency Business Plan and Budget (U 39-M). Application of Southern California Gas Company (U 904-G) for adoption of its Energy Efficiency Rolling Portfolio Business Plan and related relief. In the matter of the Application of Marin Clean Energy for Approval of its Energy Efficiency Business Plan. Application Application Application Application Application NOTICE OF EX PARTE WRITTEN COMMUNICATION BY THE CALIFORNIA EFFICIENCY AND DEMAND MANAGEMENT COUNCIL, CENTER FOR SUSTAINABLE ENERGY, ECOLOGY ACTION, NATURAL RESOURCES DEFENSE COUNCIL, PACIFIC GAS AND ELECTRIC COMPANY, RISING SUN ENERGY CENTER, SAN DIEGO GAS & ELECTRIC COMPANY, SMALL BUSINESS UTILITY ADVOCATES, SOUTHERN CALIFORNIA EDISON COMPANY AND SOUTHERN CALIFORNIA GAS COMPANY May 22, 2018 MEGAN M. MYERS Law Offices of Megan M. Myers 110 Oxford Street San Francisco, CA Telephone: (415) Facsimile: (415)

2 BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA Amended Application of Southern California Edison Company (U 338-E) for Approval of Energy Efficiency Rolling Portfolio Business Plan. Application of San Diego Gas & Electric Company (U 902-M) to adopt Energy Efficiency Rolling Portfolio Business Plan Pursuant to Decision Application of Pacific Gas and Electric Company for Approval of Rolling Portfolio Energy Efficiency Business Plan and Budget (U 39-M). Application of Southern California Gas Company (U 904-G) for adoption of its Energy Efficiency Rolling Portfolio Business Plan and related relief. In the matter of the Application of Marin Clean Energy for Approval of its Energy Efficiency Business Plan. Application Application Application Application Application NOTICE OF EX PARTE WRITTEN COMMUNICATION BY THE CALIFORNIA EFFICIENCY AND DEMAND MANAGEMENT COUNCIL, CENTER FOR SUSTAINABLE ENERGY, ECOLOGY ACTION, NATURAL RESOURCES DEFENSE COUNCIL, PACIFIC GAS AND ELECTRIC COMPANY, RISING SUN ENERGY CENTER, SAN DIEGO GAS & ELECTRIC COMPANY, SMALL BUSINESS UTILITY ADVOCATES, SOUTHERN CALIFORNIA EDISON COMPANY AND SOUTHERN CALIFORNIA GAS COMPANY Pursuant to Rule 8of the Commission's Rules of Practice and Procedure, the California Efficiency and Demand Management Council, Center for Sustainable Energy, Ecology Action, Natural Resources Defense Council, Pacific Gas and Electric Company, Rising Sun Energy Center, San Diego Gas & Electric Company, Small Business Utility Advocates, Southern California Edison Company and Southern California Gas Company (hereinafter Joint Parties ) hereby give notice of the following written ex parte communication. On May 18, 2018, the Joint Parties sent a letter via to Commission President Picker, Commissioner Peterman, Commissioner Randolph, Commissioner Guzman Aceves and 2

3 Commission Rechtschaffen, with electronic service on the Service List in A , et al. (EE Business Plans). A copy of the letter has been attached hereto as Exhibit A. The letter provided recommendations on how the revised Proposed Decision Addressing Energy Efficiency Business Plans should be modified. Specifically, the letter recommends that the Proposed Decision adopt an interim cost-effectiveness framework as proposed by the Joint Parties for the ramp years ( ) to allow a smooth transition to the third-party model that supports the state s long-term vision and goals for energy efficiency. In addition, the Joint Parties request that the Proposed Decision clarify that the Assigned Commissioner and Administrative Law Judge s Ruling and Amended Scoping Memo in Rulemaking (R.) (Energy Efficiency) will be revised following the final decision. This clarification is necessary in order to prioritize updating the cost-effectiveness framework (including threshold requirements for portfolio approval), so that these issues can be resolved by the end of the first quarter of Respectfully submitted, May 22, 2018 /s/ MEGAN M. MYERS Megan M. Myers On Behalf of the Joint Parties Law Offices of Megan M. Myers th Avenue San Francisco, CA Telephone: (415) Facsimile: (415) meganmmyers@yahoo.com 3

4 EXHIBIT A

May 18, 2018 California Public Utilities Commission 505 Van Ness Avenue, 4 th Floor San Francisco, CA 94102 Subject: Ex Parte Communication on Cost-Effectiveness Issues in Application 17-01-013 et al.

5 May 18, 2018 California Public Utilities Commission 505 Van Ness Avenue, 4 th Floor San Francisco, CA Subject: Ex Parte Communication on Cost-Effectiveness Issues in Application et al. Dear CPUC Commissioners: On April 4, 2018, the California Public Utilities Commission (Commission) issued its proposed Decision Addressing Energy Efficiency Business Plans (PD). The Commission distributed a revised PD on May 10, 2018, and clarified the PD would be held until the May 31, 2018 Commission meeting. The California Efficiency and Demand Management Council, Center for Sustainable Energy, Ecology Action, Natural Resources Defense Council, Pacific Gas and Electric Company, Rising Sun Energy Center, San Diego Gas and Electric Company, Small Business Utility Advocates, Southern California Edison Company, and Southern California Gas Company (Joint Parties) appreciate the Commission s consideration of our opening and reply comments on the PD and request the May 10, 2018 redlined PD be modified in the following ways: Adopt an interim cost-effectiveness framework as proposed by the Joint Parties for the ramp years ( ) to allow a smooth transition to the third-party model that supports the state s long-term vision and goals for energy efficiency; and Clarify that the Assigned Commissioner and Administrative Law Judge s Ruling and Amended Scoping Memorandum (Amended Phase III Scoping Memo) in Rulemaking (R.) will be revised following the final decision, in order to prioritize updating the cost-effectiveness framework (including threshold requirements for portfolio approval), so that these issues can be resolved by the end of the first quarter of Discussion The PD proposes to require the investor-owned utilities (IOUs) to forecast portfolios that aim to achieve at least a 1.25 on the Total Resource Cost (TRC) test and implement portfolios that achieve at least a 1.0 TRC on an evaluated basis. In response to the PD, the Joint Parties

6 underscored our support for achieving and delivering cost-effective energy savings. We also expressed concern that the current cost-effectiveness requirements in the PD, which effectively makes the TRC the defining test, conflict with also achieving a number of important state and Commission goals that the Joint Parties support. Namely, the Joint Parties are committed to meeting the state s goals to double energy efficiency savings by 2030, foster innovative solutions from third parties, serve disadvantaged communities and hard-to-reach residents and small businesses, and support a high-quality workforce. However, the current framework will extensively inhibit the ability of both program administrators (PAs) and third-party implementers to support innovative programs and equitably reach customers, especially those that need the most support. In light of these multi-faceted objectives, thoughtful deliberation on whether the current approach to cost-effectiveness is aligned with the state s long-term vision and goals for energy efficiency is required. We agree that Application et al. is not the appropriate venue for major modifications to energy efficiency cost-effectiveness policy and that these changes require a more robust record. 1 However, the Amended Phase III Scoping Memo does not include overarching costeffectiveness policy as one of the four issues in scope for the remainder of Phase III. 2 The Joint Parties strongly recommend the PD be modified to state that the Amended Phase III Scoping Memo in R will be revised to include cost-effectiveness policy as a primary issue in scope for the proceeding, and that a record be developed to consider updates immediately upon approval of the final decision on the Business Plans so they can be resolved by the end of the first quarter of Timely resolution of energy efficiency cost-effectiveness policy is needed because it will provide greater certainty to PAs and third parties as solicitations for new programs begin. Addressing cost-effectiveness policy will also support other primary topics in scope for Phase III (e.g., market transformation) and the Joint Parties recommend it be included in the scoping memo as a near-term priority. In the interim, the Joint Parties recommend the PD adopt an interim cost-effectiveness framework for the ramp years ( ), rather than rely solely on the updated PD, to allow for PAs to serve all customers. The Joint Parties proposals in our opening comments provide various paths forward that enable adequate oversight of ratepayer funds, support innovative program designs with the potential to scale energy savings, and ensure all customers have access to energy efficiency programs. 3 An interim solution that provides clear and certain expectations for the ramping years is necessary to support innovation and diversity in third-party program 1 PD, April 4, 2018, p. 73, COL Instead, the Commission identifies updates to cost-effectiveness policy in the Amended Phase III Scoping Memo as one of eighteen policy issues that do not require near-term decision-making. 3 For example, see Natural Resources Defense Council (NRDC) Opening Comments on the proposed Decision Addressing Energy Efficiency Business Plans, pp. 3-6; PG&E s Opening Comments on the Proposed Decision Addressing Energy Efficiency Business Plans, pp. 1-10; Opening Comments of Rising Sun Energy Center on the Proposed Decision of ALJs Fitch and Kao Addressing Energy Efficiency Business Plans, pp. 7-9; San Diego Gas & Electric Company s (U 902-M) Comments on Proposed Decision Addressing Energy Efficiency Business Plans, pp. 1-5; Comments of Southern California Gas Company (U 904 G) to Proposed Decision Addressing Energy Efficiency Business Plans, pp

7 design and implementation, across all sectors and customers, and in priority areas of the portfolio. As the energy efficiency portfolios transition to the new third-party and statewide models, close coordination between energy efficiency program administrators, implementers, industry, stakeholders, and regulators will be essential to advancing the state s vision and goals for energy efficiency. The Joint Parties look forward to collaborating with the Commission and other parties as soon as possible in Phase III to develop an updated cost-effectiveness framework that recognizes, supports, and aligns with California s diverse energy efficiency objectives. Sincerely, Michelle Vigen Senior Policy Manager The California Efficiency and Demand Management Council Sephra A. Ninow, J.D. Associate Director, Regulatory Affairs Center for Sustainable Energy Josiah Adams Director of Policy and Analytics Ecology Action Lara Ettenson Director, Energy Efficiency Initiative: Climate & Clean Energy Program Natural Resources Defense Council David Poster Director, Energy Efficiency Programs Pacific Gas and Electric Company Jodi Pincus Executive Director Rising Sun Energy Center Hillary Hebert Customer Programs Policy & Strategy Manager San Diego Gas and Electric Company Kathryn Kriozere Regulatory Attorney Small Business Utility Advocates 3

8 Michael Bushey Director of Customer Programs & Services Southern California Edison Company Erin Brooks Regulatory Policy and Reporting Manager Southern California Gas Company cc: Service List in A , et al. (EE Business Plans) 4

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA Application of SOUTHERN CALIFORNIA GAS COMPANY (U 904 G) for adoption of its Energy Efficiency Rolling Portfolio Business Plan and related