Energy Efficiency
Edison:  Review of 2006 - 2008
Risk / Reward Mechanism



This proceeding was reopened to examine three decisions involving the investor owned utilities’ energy efficiency shareholder incentive awards for their 2006-2008 energy efficiency portfolios.  In December 2010, the CPUC issued a Decision, which approved the final shareholder rewards for PG&E's 2006-2008 programs in the among of $74.4 million. The Decision based the rewards on utility reported savings rather than on CPUC staff’s Evaluation Reports.  

On November 19, 2014, ORA filed a Petition  requesting the CPUC rescind the utilities' energy efficiency rewards based on improper ex parte communications between PG&E and a commissioner, which violated state law and the CPUC’s rules. The ex parte communications addressed pending proposed decisions for the final incentive award for the 2006 - 2008 program years. 

In September 2015, the CPUC issued a Decision reopening the proceeding to ensure utility rewards were reasonable and based on verified calculations, and to consider whether refunds should be made to ratepayers.  On March 18, 2016 Edison filed a Proposal seeking to retain their full incentive awards.  

See more background on ORA's Review of Utilities’ 2006-2008 Risk/Reward Incentive Mechanism web portal. 


Settlement Agreement

On August 10, 2016 ORA, TURN, and Edison filed a proposed Settlement Agreement which would require Edison to refund to customers $13.5 million in shareholder incentives for administering 2006 – 2008 Energy Efficiency programs. The refund will be returned to customers through credits to Edison’s Base Rates Revenue Balancing Account (BRRBA) over three years in equal amounts of $4.5 million per year.   


CPUC Final Decision

On October 13, 2016, the CPUC issued a Final Decision, adopting the Settlement Agreement  




ORA Positon 

ORA supports the Settlement Agreement because it comports with ORA’s recommendations that the CPUC’s 2010 Reward Decision should have complied with previous CPUC orders.  ORA urged the CPUC to calculate the utilities’ incentive rewards based on the results from the CPUC’s Energy Division’s evaluation reports, as originally conceived by the CPUC’s energy efficiency program evaluation framework.  


See ORA’s:    

April 8, 2016 Joint Comments with TURN on the utilities’ proposals.  

March 18, 2016 Joint Proposal with TURN.  

December 4, 2015 Joint Prehearing Conference Statement with TURN.   



CPUC Docket 

See the Proceeding docket.