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Erik Jacobson
Director
Regulatory Relations

Pacific Gas and Electric Company
77 Beale St., Mail Code B13U
P.O. Box 770000
San Francisco, CA 94177
Fax: 415-973-3582

October 8, 2020

California Public Utilities Commission - Energy Division
Attention: Tariff Unit
505 Van Ness Avenue
San Francisco, CA 94102
Subject:

Pacific Gas and Electric Company’s Reply to Protests from the Public
Advocates Office, the California Efficiency + Demand Council, and the
Small Business Utility Advocates regarding Advice Letter 4303G/5936-E (PG&E's 2021 Energy Efficiency Annual Budget Advice
Letter in Compliance with Decisions 15-10-028 and 18-05-041)

Dear Energy Division Tariff Unit:
Pacific Gas and Electric Company (PG&E) replies to the protests to PG&E’s Advice Letter
(AL) 4303-G/5936-E dated October 1, 2020 from the California Efficiency + Demand
Council (“the Council”), 1 the Small Business Utility Advocates (SBUA), 2 and the Public
Advocates Office. 3 PG&E’s 2021 Energy Efficiency Annual Budget AL (ABAL) was filed
September 1, 2020 in compliance with Decisions 15-10-028 and 18-05-041.
In response to these protests, PG&E’s positions are summarized as follows: 4
Protest of the California Efficiency + Demand Council of Pacific Gas and Electric Company’s
Advice Letter 4303-G/5936-E, 2021 Energy Efficiency Annual Budget Advice Letter (“Council
Protest”).
2 Protest of the Small Business Utility Advocates of Pacific Gas and Electric Company’s Advice
Letter 4303-G/5936-E, 2021 Energy Efficiency Annual Budget Advice Letter (“SBUA Protest”).
3 Protest of the Public Advocates Office of Pacific Gas and Electric Company’s Advice Letter
4303-G/5936-E, 2021 Energy Efficiency Annual Budget Advice Letter (“Public Advocates Office
Protest”)
4 PG&E is not responding to the Council’s specific protest points in this Reply to Protests. The
Council’s Protest suggests that the IOUs’ 2021 forecasts should allow existing programs to
continue with cost-effective activities until they are replaced by new programs, and PG&E’s 2021
ABAL already reflects this recommendation. PG&E’s 2021 forecasting process did not preclude
any existing programs from forecasting cost-effective activities in 2021 in cases where no overlap
with, or replacement by, a new third-party or statewide program is anticipated in 2021. As detailed
in Section III.G of its 2021 ABAL (Advice 4303-G/5936-E), all programs that are closing on
January 1, 2021, or are slated to close upon completion of commitments, are being replaced by
new third-party programs or statewide programs that will be launching by the time the existing
programs close (with the exception of two programs explained in Table 7 of Section III.G).
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PG&E Reply to Protest of Advice Letter 4303G/5936-E -2- October 8, 2020 1. The Commission should reject the Public Advocates Office recommendation that PG&E file a supplemental ABAL a. that meets the cost-effectiveness requirements of D.18-05-041 because (i) the 2021 ABAL falls under the scope of the conditions laid out in D.18-05041 under which the Commission may still dispose of the ABAL while requiring PG&E to file a new Business Plan; and (ii) PG&E’s 2021 forecast realistically reflects what its programs can achieve in 2021. b. to reallocate budget from the nonresidential sectors to the residential sector to address residential COVID support needs and improve costeffectiveness because (i) PG&E’s nonresidential sector is also supporting customer needs during the COVID pandemic, and the Public Advocates Office did not provide sufficient evidence for why the residential sector is in greater need of pandemic support via EE programs than the nonresidential sector; and (ii) PG&E’s 2021 forecast realistically represents what programs can deliver as the portfolio ramps down existing programs and ramps up new, competitively bid third-party programs; c. to standardize accounting and reporting practices for unspent and uncommitted funds because PG&E’s 2021 ABAL followed the Commissionprovided ABAL templates and explained unspent and uncommitted funds total sin detailed table notes in its ABAL. 2. The Commission should reject SBUA’s recommendation that PG&E update its ABAL with a. information regarding the service of hard-to-reach (HTR) customers and associated coordination with the Regional Energy Networks (RENs) because PG&E and its partner RENs have filed Joint Cooperation Memos explaining coordination activities and commitments that fulfill this purpose; and b. a break-down of data by customer subclasses (residential single family, residential multifamily, small commercial, medium commercial, and large commercial) because these data are not readily available for its program forecasts, and stakeholders would be better served if this issue were addressed through the upcoming Business Plan and 2022 ABAL filings as a result of the time required to obtain these data. PG&E responds to the protests in detail below. Reply to Public Advocates Office Protest 1. PG&E recommends that the Commission reject the Public Advocates Office recommendation that PG&E file a supplemental ABAL a. that meets the cost-effectiveness requirements of D.18-05-041 because (i) the 2021 ABAL falls under the scope of the conditions laid out in D.18-
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PG&E Reply to Protest of Advice Letter 4303G/5936-E -3- October 8, 2020 05-041 under which the Commission may still dispose of the ABAL while requiring PG&E to file a new Business Plan; and (ii) PG&E’s 2021 forecast realistically reflects what its programs can achieve in 2021. The Public Advocates Office states that PG&E’s ABAL must be rejected and recommends that the Commission order PG&E to submit a supplemental ABAL that meets the cost-effectiveness requirements of D.18-05-041. 5 PG&E recognizes that its 2021 portfolio forecasted TRC of 0.89 does not meet the minimum threshold TRC of 1.0 required for ABAL approval per D.18-05-041, 6 under which circumstances the Commission may dispose of the ABAL and require a revised Business Plan 7 filing even if the ABAL doesn’t meet costeffectiveness requirements. The Amended Scoping Ruling Addressing Impacts of COVID-19 further enables Commission staff to approve of PA budget and savings forecasts even if they do not meet the requirements of D.18-05-041. 8 PG&E further asserts that its 2021 forecast is realistic, and its forecasted portfolio cost-effectiveness cannot reasonably be increased in 2021 while ramping up new local and statewide third-party programs, ramping down existing programs, and meeting customer needs during the COVID-19 pandemic. PG&E describes cost-effectiveness challenges and its strategies to improve cost-effectiveness in Sections II.E and II.F of its 2021 ABAL. For these reasons, PG&E does not believe filing a supplemental ABAL to meet a portfolio TRC of 1.0 is necessary or realistic. b. to reallocate budget from the nonresidential sectors to the residential sector to address residential COVID support needs and improve costeffectiveness because (i) PG&E’s nonresidential sector is also supporting customer needs during the COVID-19 pandemic, and the Public Advocates Office did not provide sufficient evidence for why the residential sector is in greater need of pandemic support via EE programs than the nonresidential sector; and (ii) PG&E’s 2021 forecast realistically represents what programs can deliver as the portfolio ramps down existing programs and ramps up new, competitively bid third-party programs. The Public Advocates Office recommends that the Commission direct PG&E to file a supplemental ABAL that reallocates budget from the cost-ineffective non-residential programs to cost-effective residential programs to address Public Advocates Protest, p.3. D.18-05-041, OP 49 and p.133. 7 PG&E has been directed to file a new Business Plan on September 1, 2021, per the Amended Scoping Ruling Addressing Impacts of COVID-19, p.10. 8 Amended Scoping Ruling Addressing Impacts of COVID-19, issued July 3, 2020, p.9. 5 6
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PG&E Reply to Protest of Advice Letter 4303G/5936-E -4- October 8, 2020 residential customer needs during the COVID-19 pandemic and improve portfolio cost-effectiveness. 9 PG&E considered the COVID-19 needs of its customers during its 2021 forecast development, and is taking actions to support residential customers as described in its 2021 ABAL. 10 PG&E recognizes that nonresidential customers also require support during the COVID-19 pandemic, and its 2021 portfolio forecast reflects its commitment to serving both nonresidential and residential customers through the continuation of many existing EE programs as new local and statewide programs ramp up. PG&E will be closely monitoring customer needs during 2021 program operations and will reallocate budget to the residential sector if needed. PG&E also expects that its on-going third-party program solicitation will result in additional residential program contract(s) that will further serve the residential sector. The Public Advocates Office has not provided evidence for why residential customers require more support than nonresidential customers, as both customer groups have been impacted by the COVID-19 pandemic, thus PG&E recommends against reallocating budget at this time away from nonresidential customer groups that will be receiving support through PG&E’s nonresidential programs. PG&E also reiterates that its forecasted allocation of budget to cost-ineffective programs in its 2021 portfolio serves to ensure successful program ramp-down and continued pandemic support in the meantime. At the same time, PG&E expects to ramp up new local and statewide programs that are forecasted to be cost-effective and were selected through its competitive solicitations process. These programs will take time to reach full operating capacity, and the continuation of existing programs will be important to continue to meet customer needs during the transition. 11 c. to standardize accounting and reporting practices for unspent and uncommitted funds because PG&E’s 2021 ABAL followed the Commission-provided ABAL templates and explained unspent and uncommitted funds totals in detailed table notes in its ABAL. The Public Advocates Office recommends that the Commission direct PG&E to file a supplemental ABAL to standardize accounting and reporting of unspent and uncommitted funds and ensure adherence to published ABAL templates. 12 The Public Advocates Office points to Table 3a of PG&E’s ABAL Appendix, which reports $24 million of 2020 carryover, while Table 1 of its ABAL and also Table 9 of its Appendix show $10 million in 2020 carryover. PG&E responds that a supplemental filing is not necessary because its 2021 ABAL leverages Public Advocates Protest, pp.7-10. Advice 4304-G/5936-E, Section III.D. 11 Advice 4304-G/5936-E, Section III.G. 12 Ibid, pp.17-18. 9 10
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PG&E Reply to Protest of Advice Letter 4303G/5936-E -5- October 8, 2020 the Commission-provided ABAL templates as required, and its ABAL Appendix tables include table notes explaining the unspent and uncommitted carryover totals to mitigate confusion. PG&E clarifies here that unspent and uncommitted funds for PG&E total $10 million, while unspent and uncommitted funds for PG&E, MCE, BayREN, and 3C-REN (the Program Administrators whose 2021 EE budgets are recovered through PG&E rates) total ~$24 million. PG&E’s 2021 ABAL Table 3a includes combined budget and cost recovery for all Program Administrators (PAs) recovering budget through PG&E rates, including PG&E, Marin Clean Energy (MCE), the Bay Area Regional Energy Network (BayREN), and the Tri-County Regional Energy Network (3C-REN), as intended by the ABAL Appendix Template. Table 3d summarizes the unspent and uncommitted funds for cost recovery in 2021, totaling ~$24 million for all PAs, with a table note explaining the sources used for carryover assumptions for BayREN, 3C-REN, and MCE.13 Table 7 of the ABAL Appendix summarizes 2020 unspent and uncommitted funds that align with the unspent and uncommitted funds reported in Tables 3a and 3d; Table 7 also includes a table note explaining that the 2020 unspent and uncommitted funds total of ~$24 million “includes estimated unspent & uncommitted from PG&E of $10,000,000 and carryover funds from Non-IOU entities of $14,075,000. Carryover for BayREN, 3C-REN, and MCE were taken from their respective 2021 ABAL presentations to CAEECC on August 5, 2020.” 14 PG&E’s unspent and uncommitted funds estimate of $10 million is also shown in Table 1 of the advice letter and Table 9 of the ABAL Appendix. Because PG&E’s 2021 ABAL includes the Commission-provided ABAL templates as required and its Appendix tables include table notes explaining the unspent and uncommitted carryover totals, a supplemental advice letter is unnecessary. Advice 4304-G/5936-E, Appendix Table 3b, Table note 2 states “carryover for BayREN, 3CREN, and MCE were taken from their respective 2021 ABAL presentations to CAEECC on August 5, 2020. Carryover from these presentations is assumed to include carryover from both 2019 and 2020, but the carryover estimates were not broken out by year. PG&E assumed the 2020 electric/gas split of 70%/30% for all carryover in the absence of more precise information. Final 2021 cost recovery amounts, including carryover broken out by program year and corresponding electric/gas split, will be filed by PG&E in a Tier 1 advice letter following the issuance of 2021 ABAL dispositions for PG&E, BayREN, 3C-REN, and MCE.” 14 Advice 4304-G/5936-E, Appendix Table 7, Table note 4. Table Note 4 further explains that the 2020 unspent and uncommitted funds for MCE, BayREN, and 3C-REN are assumed to also include 2019 unspent funds totals even though funds were not broken out in their 2021 ABAL presentations to CAEECC, however unspent and uncommitted funds will be clarified in a Tier 1 advice letter following the issuance of 2021 ABAL dispositions for PG&E, BayREN, 3C-REN, and MCE. 13
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PG&E Reply to Protest of Advice Letter 4303G/5936-E -6- October 8, 2020 Reply to SBUA Protest 2. PG&E recommends that the Commission reject SBUA’s recommendation that PG&E update its ABAL a. with information regarding the service of hard-to-reach (HTR) customers and associated coordination with the Regional Energy Networks (RENs) because PG&E and its partner RENs have filed Joint Cooperation Memos explaining coordination activities and commitments that fulfill this purpose. SBUA recommends that PG&E update its ABAL with information regarding the service of HTR customers and associated coordination with the RENs. PG&E highlights the Joint Cooperation Memos (JCMs), which the Commission instructed program administrators to submit annually 15 in order to formalize and describe coordination activities between PG&E and program administrators with overlapping programs. In the 2021 JCM between PG&E and BayREN, “program staff have committed to meeting on a quarterly basis to ensure that cooperation, coordination, and the best service to joint territory ratepayers is realized. Meetings will include discussions on Customer Choice, marketing, policy, and double dipping prevention. BayREN and PG&E have jointly determined a schedule for 2021.” 16 At a minimum, PG&E and BayREN plan to meet quarterly. However, areas with greater program overlap, such as Residential Single-family programs, committed to increased coordination, as needed: “BayREN and PG&E’s single-family residential teams will continue to hold standing monthly check in calls. Ad-hoc meetings will also be scheduled to accommodate the need to resolve any urgent issues that might arise. Standing agenda items include program updates, uptake, challenges, contractor issues, data transfer, double dip processes, and marketing campaign plans. BayREN and PG&E senior management teams will continue to meet – at a minimum - on a quarterly basis to discuss ongoing collaboration and coordination.” 17 PG&E recommends that program administration coordination continue through the JCM process, and not be duplicated in the ABAL process. b. with a break-down of data by customer subclasses (residential single family, residential multifamily, small commercial, medium commercial, D.18-05-041, OP 38 PG&E Advice 4260-G/5851-E (BayREN Advice 14-E), p.1. 17 Ibid, p.8. 15 16
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PG&E Reply to Protest of Advice Letter 4303G/5936-E -7- October 8, 2020 and large commercial) because these data are not readily available for its program forecasts, and stakeholders would be better served if this issue were addressed through the upcoming Business Plan and 2022 ABAL filings as a result of the time required to obtain these data. SBUA recommends that the Commission direct PG&E to break out residential and commercial customers into subgroups, including residential single family, residential multifamily, small commercial, medium commercial, and large commercial. 18 PG&E responds that its 2021 forecast data cannot immediately be broken out by these customer subclasses, because the forecast was largely based on forecasts provided by program implementers that were not instructed to break out the forecast data in this manner. Consequently, a breakout by customer subclass would take time to develop. PG&E recommends that this breakout be considered for the upcoming Business Plan application and 2022 ABAL instead of retroactively for the 2021 ABAL. Conclusion PG&E recommends that the Commission reject the Public Advocates Office recommendation that the Commission direct PG&E to submit a supplement to its 2021 ABAL to improve cost-effectiveness, reallocate budget to the residential sector for customer pandemic support, and standardize unspent and uncommitted funds templates because PG&E’s 2021 ABAL forecast is realistic, provides needed pandemic support to all sector customers, and follows Commission templates with explanatory notes, respectively. Furthermore, PG&E recommends that the Commission reject the SBUA recommendation that the Commission direct PG&E to update its 2021 ABAL with additional information on REN coordination and to break out data by customer subclass, because the JCMs submitted by PG&E already outline REN coordination activities and breaking out data by subclass would be more appropriate for the upcoming Business Plan application and 2022 ABAL next year, respectively. PG&E respectfully requests that the Commission approve PG&E’s 2021 EE portfolio budget request in Advice 4303-G/5936E as filed on September 1, 2020. /S/ Erik Jacobson Director, Regulatory Relations cc: cc: cc: cc: 18 Shelly Lyser, Public Advocates Office Greg Wikler, CEDMC Ivan Jimenez, SBUA Service Lists R.17-01-013 et al., R.13-11-005 SBUA Protest, p.7.
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