posted on Tuesday, September 04, 2007 9:04 AM
by
Tracy Davis
CPUC to Consider Innovative Energy Efficiency Incentives for State's IOUs
The California Public Utilities Commission (CPUC) will soon consider an innovative incentive program to encourage the state's investor-owned utilities (IOU) to meet energy savings goals. Based on an August 9 proposed decision by CPUC Commissioner Dian Gruenich and Administrative Law Judge Meg Gottstein, the proposal would pay the IOUs -- include Pacific Gas & Electric Co., San Diego Gas & Electric Co., Southern California Edison Co., and Southern California Gas Co. -- up to $323 million over three years if they exceed the base targets. If utilities satisfy these goals, the plan would purportedly save California ratepayers $2.4 billion and cut about 3.4 million tons of carbon dioxide emissions in 2008. Conversely, if the utilities fail to meet the base targets, the plan would impose monetary penalties on them. The proposal caps both potential earnings and losses for shareholders at $500 million.
Commissioner Gruenich, the plan's chief proponent, argued that the proposal would provide "both a meaningful level of shareholder earnings and an estimated return of over 100 percent on ratepayers' investments in energy efficiency as the utilities reach toward and exceed our 2006-2008 energy savings goals." The proposed decision is on the CPUC's agenda for its September 20 meeting.