State rewards PG&E for not conserving
When California electrical utilities meet goals for energy efficiency, the California Public Utilities Commission rewards them extra profits that result in rate increases. On the other hand, when they fail to meet the targets - the CPUC rewards them anyway.
That, in any case, is what the CPUC decided in December. Despite a draft report from its staff showing the utilities to have fallen far short of energy-savings goals for their 2006 - 07 energy-efficiency programs, the CPUC authorized an $82 million rate increase - $42 million of this to PG&E.
In September 2007 the CPUC set a minimum threshold that utilities were supposed to meet to earn up to 12% profits on energy efficiency. In January 2008 after months of furious lobbying by utility top brass, commissioners caved and lowered the threshold, and also made these profits non-refundable, even if final evaluation studies should end up showing lower achievements.
The December 2008 decision rendered the threshold meaningless, since the Commission gave out profits in spite of utilities' failing to meet even the twice-lowered bar.
(S)light savings
Over 90% of utility energy-efficiency savings come from lighting, about 60% from distribution of compact fluorescent light (CFL) bulbs. The utilities, however, have objected to the CPUC's requirement for surveys examining how many people purchased the item because they were influenced by the program, compared to how many would have purchased the item anyway, even if there was no program. The latest study shows that CFL sales in states with no CFL energy-efficiency programs are now as high as or higher than in California.
Utilities could have embraced this news as evidence that their past CFL programs have succeeded, and it's time to move on. Instead they stubbornly want CFLs to be the centerpiece of the next round of programs, for which they propose a budget of almost $4 billion - a 30% increase over 2006 - 08 programs.
The wrong savings
The Commission wants utilities to pay more attention to other energy-efficiency measures, especially those that reduce the load from airconditioning, which is the driving factor behind the construction of new power plants in California. Utilities are resisting these changes because they would have to work harder to get incentive money. They also want to claim profits that result from the work of state and local governments, for example on improved "codes and standards." Because of utility foot-dragging, the Commission is a year behind schedule in approving 2009-11 programs, which will now start in January 2010.
The Obama administration is awarding tens of billions of federal stimulus funds to cities and counties for energy-efficiency work in the next two years. California cities and counties, as well as the Sierra Club, Women's Energy Matters, TURN (The Utility Reform Network), and CPUC's Division of Ratepayer Advocates, are calling for an independent entity to administer energy efficiency, instead of utilities, in part to prevent utilities from claiming profits for work funded by federal dollars.
Not so "Climate Smart"
We shouldn't be misled by programs like "ClimateSmart", where PG&E shakes down conscientious people for extra money, some of which is donated to forest preservation. Unfortunately for the environment, the program's most important product is greenwashing - cleverly diverting attention from the environmental destruction and negligence of PG&E's everyday business practices.
PG&E has refused to offer tree-planting as part of the energy-efficiency programs already covered in our rates. By contrast, the Sacramento Municipal Utility District plants trees as a conservation measure, at no extra charge, and SMUD's rates average 30% less than PG&E's. In addition to the climate benefits of absorbing CO2, Sacramento's leafy streets lower the temperature of the city 7°, so that air conditioners consume much less power.
When environmentally concerned customers turn to PG&E to support tree planting, the company hopes that they will begin to view the company as a friend, focusing on minor benefits and failing to hold the company responsible for the much larger damages it causes.
WhatYouCanDo
Write the CPUC at public.advisor@cpuc.ca.gov. Urge the Commission to create an independent entity to administer energy efficiency, Request the public advisor to distribute your comments to all the commissioners.