1. Bill Savings Public Workshop Costs and Bill Saving in the Low Income Energy Efficiency Programs for 2003 to 2005 April 21, 2005 - 10:00 AM to Noon 77 Beale Street San Francisco

2. 2 Introduction In 2000, D.00-07-020, Ordering Paragraph 7 ordered the utilities to: ...jointly develop standardized methods for producing bill savings and expenditures for the Low Income Energy Efficiency (LIEE) program on an overall program and per unit basis, by utility.  The methods were developed and the report ordered in D.00-07-020 was filed on time with errata filed on March 12, 2001.

3. 3 Introduction (cont.) This workshop presents the results of applying the accepted methodology for determining costs and bill savings estimates of the LIEE program years 2003 through 2005. A report will be filed that is in compliance with Decision (D) 01-12- 020, Ordering Paragraph 4

4. 4 Costs Each LIEE implementer is required to separate costs into 16 labor, non-labor, and contract expenditure components.

5. 5 Bill Savings Bill savings are the life cycle net present value saved by the average dwelling due to the measures installed under the LIEE programs.  Energy savings are determined from engineering analysis or M&E studies performed after the program was fielded.  Per-unit energy savings for PY2004 and PY2005 are from the PY2001 LIEE Impact Report and the Final LIEE Measure Cost Effectiveness Report.  Per-unit energy savings for PY2003 are from the PY2000 LIEE Impact Report and the Draft LIEE Measure Cost Effectiveness Report.  Many Effective Useful Life values for life cycle calculation based on CALMAC values, September, 2000. Substituted EULs from Revised / Updated EULs Based on Retention and Persistence Studies Results, July 2005 for 3 measures.

6. 6 EULs from “Revised/Updated” Report MeasurePrevious Bill Savings EUL Revised EUL from July 2005 report High Efficiency Furnace 2218 CFL Fixture, Residential 2016 Refrigerators1518

7. 7 Bill Savings (cont.) The general algorithm for estimating bill savings is: where: r = fuel type (gas or electric) Y=Year, starting with implementation program year m=measure type energy rate Y,r =energy rate ($ per kWh or therm) for fuel r in year Y Impact m = measure m gross impact per year (kWh or therm) Number m = number of measure type m installed EUL m = effective useful life (years) of measure type m

8. 8 Energy Rates

9. 9 Analysis of Data Analyzed and compared within each utility from PY2004 to PY2005 to explain year to year differences. Analyzed and compared across utilities to explain differences seen for PY2005 by “service territory”.  PG&E  SoCalGas and SCE combined  SDG&E

10. 10 Results Summary of Bill Savings to Cost Ratios by Service Area Summary of Average Per Home Life Cycle Bill Savings by Service Area

11. 11 Results - Bill Savings to Cost Ratio by Year SDG&E has a higher Bill Savings to Cost Ratio than SCE/SoCalGas and PG&E.

12. 12 Results - Per Home Bill Savings by Year Similar spread for 2005 compared to prior years.

13. 13 Results of Analysis – Year to Year Per Home Bill Savings -When EUL changes and changes in measure installation rates for refrigerators, CFLs, showerheads and furnace repair or replacement measures were taken into account, 2004 to 2005 per home bill savings difference for each utility was within 10%.

14. 14 Results of Analysis – Across Utility Adjusted 2005 Bill Savings/Cost Ratio PG&ESCE/ SoCalGasSDG&E Original Bill Savings to Cost Ratio 0.54 0.69 Actual PY2005 Energy Rate0.0956 kWh 1.0310 Therm 0.1016 kWh 0.9490 Therm 0.140 kWh 0.990 Therm Assumed Modified Energy Rate0.1117 kWh 0.9890 Therm Modified Bill Savings to Cost Ratio 0.610.590.58 - When adjusted for energy rates, the 2005 bill savings to cost ratio varies by ~5% across “service territories”.

15. 15 Results of Analysis – Across Utility Adjusted 2005 Per Home Savings - When adjusted for energy rates and refrigerator installation rates, the 2005 average per home savings vary by ~6% across “service territories”.

16. 16 Reasons for Results PY2003 reasons for variations are refrigerator installation rate, refrigerator impact values and energy rates. PY2004 Very little spread in unadjusted values. Energy rate had a marginal effect on bill savings to cost ratio. No other effects. PY2005 similar to PY2003, the variation seen is due to refrigerator installation rates and energy rates.

17. 17 Conclusions Changes in EULs and changes in measure installation rates for four measures accounted for all but ~10% of the 2004 to 2005 per home bill savings difference for each utility. Energy rates account for all but ~5% of the variation in the 2005 bill savings to cost ratio by across “service territories”. Energy rates and refrigerator installation rates accounted for all but ~6% of the variation in the 2005 average per home savings across “service territories”.

18. 18 Conclusions In short, this analysis shows that when variations in energy rates and measure installations rates are accounted for, the PY2005 LIEE program delivered comparable programs and savings to program participants statewide.

19. 19 Supplemental Slides

20. 20 Supplemental Slide 1 - EUL Values Used

21. 21 Supplemental Slide 2 – Year-to-Year Differences by Utility Percent Difference between PY2005 and PY2004 Number of Homes Treated by Year by Utility

22. 22 Supplemental Slide 3 – Results by Utility

23. 23 Supplemental Slide 4 – Results Across Utility