PG&E’s proposal, CLECA notes that CAISO will not move its resource adequacy availability assessment hours from 1:00 p.m.- 6:00 p.m. to 4:00 p.m. – 9:00 p.m. until 2019. PG&E does not deny CAISO’s plans, but adds that its loss of load expectations heat map analysis is already showing greatest value from 6:00 p.m. to 9:00 p.m. The Joint Demand Response Parties requests that the Commission require PG&E to return its Capacity Bidding Program hours to their current hours, arguing that PG&E has not substantiated why the program hours need to be modified. The Joint Demand Response Parties adds that PG&E is anticipating changes in resource adequacy Availability Assessment Hours that have not been adopted by the Commission in the resource adequacy proceeding and are not consistent with CAISO tariffs. The Joint Demand Response Parties do not consider the heat map analysis cited by PG&E equivalent to an analysis conducted by the Commission or CAISO. The Joint Demand Response Parties point out to the importance of consistent rules across the Utilities and consistency of Capacity Bidding Program operating hours and resource adequacy availability assessment hours. The Joint Demand Response Parties adds that third-party providers rely on Commission and CAISO rules as written. According to the Joint Demand Response Parties, allowing Utilities to modify those rules before adoption lead to market uncertainty and customer confusion. PG&E explains that PG&E’s loss of load expectations analysis is already showing a need for the proposed hours. PG&E’s analysis is clearly not equivalent to a Commission decision; however, we cannot simply ignore PG&E’s conclusions. Therefore, we see value in PG&E’s effort to be proactive and proposal to adjust the operating hours based on the grid needs. However, we also want to allow time for current program participants to adjust to these new
SDG&E’s Emerging Technology program proposal is adopted with one modification. SDG&E shall not pursue new permanent load shifting projects as the Commission has determined them not to be cost-effective. Here again, in order to address the low cost-effectiveness results for the portfolio, this Decision decreases SDG&E’s Emerging Technology budget by 10 percent. SDG&E is authorized a five-year program cycle budget of $3.483 million. 6.6. Demand Response Pilots 6.6.1. PG&E PG&E proposes to continue with two pilot programs, Supply Side II demand response pilot (SSP II) and the Excess Supply demand response pilot, and evaluate their performance in the mid-cycle review. According to PG&E, SSP II investigates the operational feasibility of utilizing demand response resources that are integrated in the wholesale energy markets and provide resource adequacy to address local distribution needs. This pilot was originally initiated in 2013. Most recently, the Commission approved SSP, the predecessor of SPP II, in D.16-06-029. PG&E explains that it proposes to continue with this pilot because (1) past pilots have shown that it will take more than a year to get meaningful results on utilizing demand response resources for distribution services, and (2) this work will entail exploring ways to operationalize the integration of wholesale demand response resources with distribution operations. PG&E’s other pilot proposal, Excess Supply Demand Response Pilot, aims to explore how customers can mitigate situations of excess supply by shifting their load. This pilot was initiated in 2015 and the Commission extended the pilot through 2017 in D.16-06-029. PG&E reports that progress has been made on
another program within the same budget category, with proper monthly reporting, but not between the seven budget categories we adopt in this decision. We continue to require that Utilities submit a Tier 2 AL before shifting more than 50 percent of a program’s fund to a different program within the same budget category and follow the directives given in D.12-04-045. We do not have substantiating record to change this policy in this proceeding and therefore maintain the existing funding shifting rules. 8.2. Budget Requests PG&E, SCE, and SDG&E submitted the following budget requests by program category for 2018-2022, as shown in Table 23. These budget requests cover anticipated administrative and incentive costs related to demand response programs and portfolios. Administrative costs include all costs other than incentives such as ME&O, pilot proposals, demand response operational cost, systems and support cost, measurement and evaluation, program management and overhead costs. Table 23 Utility Budget Requests for 2018-2022 (in thousands) PG&E SCE SDG&E Category 1 – Supply-Side Demand Response program $ 214,266 $ 51,819 $ 27,671 Category 2 – Load Modifying Demand Response Program $ 11,422 $ 6,925 $ 8,096 Category 3 – Demand Response Auction Mechanism and Direct Participation Support $ 12,931 $ 0 $ 8,037 Category 4 – Emerging and Enabling Technology programs $ 27,677 $ 67,620 $ 21,383 Category 5 – Pilots $ 13,768 $ 430 $ 8,429 Category 6 – Marketing, Education, and Outreach (ME&O) $ 14,363 $ 14,337 $ 4,502 Category 7 – Portfolio Support (includes EM&V, Systems Support, and Notifications) $ 54,740 $ 36,028 $ 19,819 Total for 2018-2022 Portfolio $ 349,165 $ 177,160 $ 97,938
Pacific Gas and Electric Company’s (PG&E) Demand Response Emerging Technology Program is approved as requested. PG&E is authorized a five-year budget of $7.230 million to operate the program. Southern California Edison Company’s (SCE) Automated Demand Response Technology Incentive Program and Programmable Communicating Thermostat Incentive Program are approved as amended. SCE shall provide Auto Demand Response technology incentives to participants of any supply side demand response program/activity not required to be analyzed for costeffectiveness. SCE is authorized a five-year budget of $43.639 million. Southern California Edison Company’s (SCE) Emerging Markets and Technologies program is approved as requested. SCE is authorized a five-year budget of $14.61 million. SCE may provide additional information on this program in the 2020 mid-cycle update. If SCE provides sufficient additional information, SCE may be granted additional funding up to $4.715 million each year, based on the amount requested for 2018 in this application. San Diego Gas & Electric Company’s (SDG&E) Auto Demand Response program is approved as amended. SDG&E shall provide Auto Demand Response technology incentives to participants of any supply side demand response program/activity not required to be analyzed for cost-effectiveness. SDG&E is authorized a budget of $11.967 million. San Diego Gas & Electric Company’s (SDG&E) Technology Deployment Program is approved. SDG&E shall require customers to enroll in any supply side demand response program, either SDG&E-administered or a third-party program. SDG&E is authorized a budget of $3.794 million. San Diego Gas & Electric Company’s (SDG&E) Emerging Technology program is approved as modified; SDG&E shall not implement its Permanent
Account (DREBA), and (2) establish a Demand Response Auction Mechanism Sub-account in the DREBA. San Diego Gas & Electric Company (SDG&E) is authorized a budget of $2.98 for costs related to operations of third party direct participation; the funding is contingent upon a reasonable showing by SDG&E in a Tier 2 Advice Letter. Within 60 days of the issuance of this Decision, SDG&E shall file the Tier 2 Advice Letter providing additional justification for the $2.98 million. The Director of the Energy Division is authorized to hold a workshop in the first quarter of 2018 to discuss a draft straw proposal on the subject of targeting demand response in constrained local capacity areas and disadvantaged communities. Pacific Gas and Electric Company, San Diego Gas and Electric Company, and Southern California Edison Company (the Utilities) are authorized a threeyear budget of $2.5 million for pilot programs, $1 million each for PG&E and SCE, and $.5 million for SDG&E, targeting demand response in constrained local capacity areas and disadvantaged communities. Ten percent of this budget shall be used to evaluate the success of the pilots. The specifics of the pilots will be determined in a future decision. Pacific Gas and Electric Company (PG&E), Southern California Edison Company (SCE) and San Diego Gas & Electric Company (SDG&E) are authorized a five-year budget of $5 million for updates to the Demand Response Potential Study and other research projects, $2 million each for PG&E and SCE, and $1 million for SDG&E. Unless indicated otherwise in this Decision, Pacific Gas and Electric Company, San Diego Gas & Electric Company, and Southern California Edison