Commission Delays 2009-11 Efficiency Plans

By Published On: February 20, 2009

A California Public Utilities Commission administrative law judge quietly delayed final commission consideration of investor-owned utility plans to spend $3.3 billion on energy efficiency between 2009 and 2011. Originally, the decision was expected late last year. The judge moved it to August. CPUC administrative law judge David Gamson postponed the approval process in a February 10 ruling amid continued controversy over the effectiveness of utility plans to subsidize compact fluorescent lights. A report by The Cadmus Group done for regulators last month showed that sale of compact fluorescent lights in other states is catching up with the rate of sales in California. The study--Compact Fluorescent Lamps Market Effects Interim Report-- raised questions about whether continuing to subsidize the bulbs still can be considered an innovative strategy for saving energy. “As long as we have studies that show we still have opportunities for compact fluorescent lamp installation and federal codes and standards have not yet taken effect, we and the state still need to maintain our work toward this goal,” said Grant Brohard, Pacific Gas & Electric manager, disagreeing with the report’s conclusions. How the commission decides the question is important as utilities revise their 2009-2011 plans. They must do so because after submitting their initial plans last summer, the commission ruled last fall that the goal for energy efficiency programs between 2009 and 2020 should be to pursue “big, bold” strategies (Circuit, Sept. 23, 2008). At the same time, the commission asked utilities to amend their plans to include such strategies, which are supposed to “transform” how energy is used and result in innovations in lighting, heating and air conditioning, as well as how buildings are designed and built. The commission’s eventual goal is for new buildings to use no more energy than the solar panels on their roofs produce. Against this backdrop, the latest Cadmus study is generating debate. “CFL sales in other states are as healthy, if not more so, even in states without utility CFL programs,” wrote Cynthia Mitchell, an economist representing The Utility Reform Network and Division of Ratepayer Advocates in comments to the CPUC on the report. This indicates that the California subsidy programs as now carried out are having little effect, the organizations have indicated. To make them more effective Mitchell wrote that the two organizations believe future compact fluorescent light efforts should carefully focus on supplying the bulbs to people who are not yet using them and in fostering a market for specialty applications of the energy saving bulbs, for instance with dimmer switches or smaller bases. An accompanying report by KEMA showed that--based on a survey of California homes--20 percent of all light sockets use compact fluorescent bulbs. Fifty-five percent use incandescent bulbs. Utilities questioned the methodology of the interim report. They maintain the subsidy programs are working. San Diego Gas & Electric, for instance, wrote that the programs are increasing sales of the bulbs and getting more companies to make and sell them in California. In addition, more retailers are selling them at lower prices even as their quality increases, the utility added. Investor-owned utilities are paid for pushing energy efficiency measures through a commission incentive program. That program, however, is in question. The commission opened up a docket for investigating potential problems with efficiency incentives earlier this year. On December 18, 2008, the commission approved $82 million in incentive payments that utilities did not have to verify. Two consumer advocate groups, the state Division of Ratepayer Advocates and The Utility Reform Network applied to overturn the decision.

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