On a split vote, the California Public Utilities Commission approved roughly $754 million in energy-efficiency funds for 2004-2005. The approved pot of money includes $245 million for utility energy-efficiency programs that replace a portion of procurement needs for the next year. Two other proposals before the CPUC that did not make the cut interfered with community-choice aggregation, according to community-choice supporters. In a rare victory for commission member Loretta Lynch, her plan?supported by conservation advocates?passed. Lynch?s plan cut $64 million from the funding allocated in a draft decision, on grounds it failed to meet criteria established by commission staff. Conservation activists have been trying to keep utilities out of the process of allocating the funds to local groups for their outreach, claiming that utilities are out of touch with local needs. While the $64 million worth of utility conservation programs are being scrutinized, they will be given bridge funding. Funds will be restored in February only if the programs measure up. Assigned commissioner Susan Kennedy argued that Lynch offered no guidance on how the programs in question could meet the applicable criteria. Kennedy added that submitting them to another round of review would unnecessarily burden the Energy Division. Commissioner Carl Wood responded that the ?commission has a right to take a second look? at programs to see whether they pass muster. Kennedy and commission president Mike Peevey cast dissenting votes. In other news, PG&E?s request to pay the Department of Water Resources for actual costs rather than remittance rates for interim procurement contracts signed in 2002 was rebuffed. Instead, the Energy Division said cost discrepancies should be ironed out in the DWR revenue requirement proceedings.