BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Transcription

1 BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA In the Matter of the Application of PacifiCorp (U 901-E) for Approval of the California Alternate Rates for Energy and Energy Savings Assistance Programs and Budgets for Program Years Application No (Filed February 2, 2015) APPLICATION OF PACIFICORP (U 901-E) FOR APPROVAL OF THE CALIFORNIA ALTERNATE RATES FOR ENERGY AND ENERGY SAVINGS ASSISTANCE PROGRAMS AND BUDGETS FOR PROGRAM YEARS Michelle R. Mishoe PacifiCorp 825 NE Multnomah, Ste 1800 Portland, OR Telephone: Facsimile: Date: February 2, 2015 Attorney for PacifiCorp 1

2 BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA In the Matter of the Application of PacifiCorp (U 901-E) for Approval of the California Alternate Rates for Energy and Energy Savings Assistance Programs and Budgets for Program Years Application No (Filed February 2, 2015) APPLICATION OF PACIFICORP (U 901-E) FOR APPROVAL OF THE CALIFORNIA ALTERNATE RATES FOR ENERGY AND ENERGY SAVINGS ASSISTANCE PROGRAMS AND BUDGETS FOR PROGRAM YEARS PacifiCorp, d/b/a Pacific Power (PacifiCorp or the Company) respectfully submits its Application for Approval of the California Alternate Rates for Energy (CARE) and Energy Savings Assistance (ESA) Programs and Budgets for Program Years (PY) (Application). This Application is made in accordance with California Public Utilities Commission (Commission) Decision (D.) , California Public Utilities Code 382 and 739.1(b) of the California Public Utilities Code and Commission Rules of Practice and Procedure Rule 2. I. INTRODUCTION/OVERVIEW PacifiCorp provides electric service to 1.7 million retail customers in six states, including California, Idaho, Oregon, Utah, Washington and Wyoming. PacifiCorp serves approximately 45,000 customers in northern California, of which approximately 35,400 are residential customers. The Company serves the northern-most areas in California from the Crescent City area on the coast, to Modoc County in the northeast corner of California, and the mountainous 2

3 Siskiyou County. This is a large geographic area with low population centers, with an average of 3.9 customers per square mile. PacifiCorp is one of six Small and Multi-jurisdictional Utilities (SMJUs) in California. SMJUs have significantly smaller ESA and CARE Program budgets, limited manpower, a smaller customer base for recovery of program costs and alternative reporting requirements as compared to the large investor-owned utilities in California. The Company offers income-eligible residential customers the opportunity to receive a bill discount through its CARE Program. The Company increased participation for the CARE Program from 75 percent in 2012 to 83 percent at the end of December 31, 2014, and will strive to reach the 90 percent participation goal set forth in D and in D for the PY budget cycles. The Company's proposed budget is commensurate with reaching the 90 percent penetration goal in PacifiCorp's ESA Program, which is administered locally through community-based organizations (CBO), offers weatherization services to income-eligible residential customers. The Company partnered with CBOs and continued to install energy efficiency measures in the homes of eligible customers during PY PacifiCorp intends to continue these relationships as a way to achieve the vision the Commission adopted for the low income communities in the Long Term Energy Efficiency Strategic Plan-to provide all cost-effective ESA measures to 100 percent of eligible and willing customers by Table la below shows the Company's proposed CARE Program budget for PY The Company's proposed budget for the CARE Program is discussed in more detail in 1 Ordering paragraph Ordering paragraph See D , p.ll. 3

4 Section II.B.2. The proposed budget is also shown by cost category on the Commissionprovided template in Attachment B-1, contained in Appendix B. TABLE1A CARE Proposed Program Budget for PY Program Budget 2015 $3,756, $3,968, $4,243,397 Table IB below shows the budget information for the ESA Program for PY The Company's proposed budget for the ESA Program is discussed in more detail in Section III.B.2. This proposed budget is also shown by cost category on the Commission-provided template in Attachments A-2 and A-3, contained in Appendix A. TABLE1B ESA Proposed Program Budget for PY Year Budget 2015 $937, $950, $950,000 Total Budget for PY $2,837,500 II. CARE PROGRAM A. BACKGROUND In 1989, California Public Utilities Code established the CARE Program. The CARE Program is an income-qualified rate assistance program that provides a 20 percent bill discount for eligible customers whose household income does not exceed 200 percent of the 4

5 federal poverty income guidelines. Before 2012, the Commission set eligibility for PacifiCorp's CARE Program using a lower percentage of federal poverty guidelines than other utilities. In D , the Commission issued guidelines for the CARE Program (formerly Low Income Rate Assistance program), which established eligibility for PacifiCorp's CARE Program at or below 130 percent of the federal poverty level compared to 150 percent of the federal poverty level for all other California utilities. The rationale for this difference was that the average household income within the Company's service territory was significantly below the overall average for California and a 130 percent level yielded an eligibility rate roughly commensurate with that of other utilities. In D , the Commission revised the income eligibility for PacifiCorp's CARE Program to 175 percent of the federal poverty guidelines. Eligibility for participation in PacifiCorp's CARE Program remained at 175 percent of federal poverty guidelines compared to 200 percent for other utilities until January 2012 when the Commission directed the Company to modify its eligibility requirements to 200 percent of federal poverty guidelines. 4 Based on 2010 U.S. Census data, this increased eligibility for participation in PacifiCorp's CARE Program from 34.5 percent to 39 percent, which essentially re-set the participation rate to the mid-70 percent range down from the mid-80 percent range. PacifiCorp now estimates approximately 83 percent of eligible customers participate in the CARE Program. PacifiCorp recovers its costs for the CARE Program through the CARE surcharge in Tariff Schedule S-1 00, which covers program administration and the CARE Program benefits (discounts) provided to income-eligible customers. PacifiCorp is not requesting a change to the CARE surcharge at this time. The Company will continue to monitor the Program and will file 4 D.l , Ordering Paragraph 10. 5

6 an advice letter to adjust the surcharge in October each year, if needed, as authorized in D B. CARE PROGRAM GOALS AND BUDGET FOR PY 2015, 2016, AND CARE Goals for PY 2015, 2016, and 2017 As of December 31, 2014, 11,552 customers, approximately 83 percent of eligible customers, were enrolled in the CARE Program. As shown in Table 2 below, the participation level increased during PY 2012, 2013 and During the budget cycle, PacifiCorp continued its outreach activities in an effort to reach the 90 percent CARE Program participation goal 6 by adding in 2012 and continuing for 2013 and 2014 print and radio advertisements throughout the Company's service territory. Additionally, beginning in 2013 and continuing in 2014, the Company sent a direct mail piece to all residential customers not enrolled in the CARE Program. After sending direct mail to all non-care residential customers, PacifiCorp's CARE participation increased from 74 percent to 81 percent. The direct mail outreach effort has proven to be an effective outreach method for PacifiCorp's low income customers. Plans are to continue this effort in the 2015 through 2017 budget cycle. Use of the direct mail outreach mechanism is helping to overcome the biggest challenge for the CARE Program--ensuring all potential participants know the CARE program is available to them and encouraging participation. PacifiCorp's participation goals for the CARE Program for PY 2015, 2016 and 2017, are 85 percent, 87 percent and 90 percent, respectively. Table 2 shows the number of CARE participants and penetration rate for each PY , and the projected number of participants and penetration rate for PY Also see Attachment B-2, contained in Appendix B. 5 n '),1 C)rrl.o>r1nrr Paragraph l' 7- LJ. o, '-/.1.\.J..V..L.L.I...LfS..L U...L 6 D.l , Ordering Paragraph 15. 6

7 TABLE2 CARE Program Participants and Penetration Rate YEAR PARTICIPANTS PENETRATION RATE ,064 73% ,975 79% ,552 83% Proposed Goal ,795 85% Proposed Goal ,000 87% Proposed Goal ,500 90% 2. CARE Budget for PY 2015, 2016, and 2017 As shown in Table 3 below, total Program costs, including the bill discount, are projected to be $3,756,530 for an 85 percent participation rate in 2015, $3,968,631 for an 87 percent participation rate in 2016, and $4,243,397 for a 90 percent participation rate in Approximately 97 percent of the Company's proposed annual budget will be used directly for the bill discount. Less than three percent of the proposed budget is for administration of the CARE Program. PacifiCorp proposes an annual budget for administration of the CARE Program of $130,000 for py Administration costs include Outreach, Processing/Certification/Verification, and General costs. The proposed budget for each of these cost categories is discussed in more detail below. Attachment B-1, contained in Appendix B, also provides a breakdown of the CARE Program budget (authorized and recorded) for PY and the proposed budget for PY by cost category. The cost per household by budget category is provided in Attachment B-3, contained in Appendix B. 7

8 TABLE3 CARE Actual and Proposed Program Costs Total Administration CARE Program Total Program Year Costs Discount Costs 2012 Actual $65,689 $2,975,094 $3,040, Actual $70,976 $3,076,631 $3,147, Actual $78,906 $3,434,611 $3,513, Proposed $130,000 $3,626,530 $3,756, Proposed $130,000 $3,838,631 $3,968, Proposed $130,000 $4,113,397 $4,243,397 The CARE budget includes a category for Processing/Certification/Verification costs. Attachment B-1, contained in Appendix B, includes no actual recorded costs in this cost category for PY because these costs were captured in the General Administration cost category. For this new budget cycle beginning in 2015, the Company has developed a mechanism for tracking these costs, which will be reported m the Processing/Certification/Verification cost category for PY As a result, the proposed budget for the Processing/Certification/Verification cost category in PY is higher than in prior years. Additionally, the proposed budget includes estimated costs for two new procedures the Company will implement to verify income eligibility in PY In prior years the Company used only the self-certification process as allowed in D As discussed in more detail below, beginning in 2015, the Company will be asking its partnering CBOs to select a random sample of customers enrolled in CARE that will be required to provide appropriate documentation demonstrating eligibility for the CARE Program. The Company has 7 Ordering Paragraph 2. 8

9 also initiated a percent of Baseline Post Emollment Verification process for CARE customers that will be administered through the CBOs. Labor expenses for CARE Program management personnel along with travel expenses to attend Commission meetings and workshops are included in the General cost category. The Company proposes increasing the General Administration category in PY to capture partial costs associated with the Company's intent to contract for a needs assessment study to be conducted in PacifiCorp's service territory. This study will identify and verify the Company's estimate of low income customers eligible for the CARE and ESA Programs. The study is discussed further in Section III.B.1. PacifiCorp proposes decreasing the Outreach budget from the previous budget cycle based on the actuals costs for Outreach during the PY The Company promotes both the CARE and ESA Programs together where possible to effectively manage the Outreach costs and does not anticipate significant differences in such costs for the PY budget cycle. Refer to Attachment B-3, contained in Appendix B, for total costs per household. C. CARE PROGRAM ADMINISTRATION 1. Program Enrollment/CertificationN erification As previously discussed, beginning in 2015, the Company will use a new mechanism for tracking emollment, certifications and verification costs and they will be reported as part of the Processing/Certification/Verification cost category for PY In prior years these costs were included in the General cost category. Attachment B-1, contained in Appendix B, provides the total recorded Processing/Certification/Verification costs for PY and the Company's proposed budget for PY Also see discussion in Section II.B.2. 9

10 a. Program Enrollment There are several ways customers may enroll in the CARE Program. Customers can work directly with PacifiCorp by obtaining a CARE Program Application from the Company's website or by calling the Company and returning a completed form to the Company, or by applying online by signing into the customer's online Pacific Power account. Additionally, the Company partners with CBOs that administer the federal Low Income Home Energy Assistance Program (LIHEAP) to assist customers with completing the CARE applications. On a quarterly basis PacifiCorp enrolls customers who receive federal LIHEAP payments in the CARE Program if they are not already enrolled. Further, PacifiCorp delivers CARE applications to local agencies such as senior centers, social service agencies and housing authorities in our service territory. Three local tribes are included in this distribution process, Yurok Tribal Housing Authority, Elk Valley Rancheria and Smith River Rancheria Housing Authority. b. Program Re-Certification PacifiCorp uses a self-certification process for CARE participants. 8 Every two years CARE customers must recertify their eligibility for the Program. As part of this process, the Company sends a letter with a recertification form and postage-paid return envelope to each customer that has participated in the program for the previous two years. Additionally, as mentioned above, on a quarterly basis PacifiCorp enrolls customers who receive federal LIHEAP payments in the CARE Program if they are not currently enrolled. If they are enrolled in the CARE Program, then PacifiCorp automatically recertifies them for another two-year cycle. 8 D , Ordering Paragraph 2. 10

11 c. Program Verification The costs associated with this function are included m the Processing/Certification/Verification portion of the CARE budget for PY Beginning in 2015, a two percent random sample of customers will be selected for income verification. The selected customers will be required to provide appropriate documentation demonstrating eligibility to participate in the CARE Program to one of the partnering CBOs. Any customer not meeting the income eligibility requirements or not responding to the verification request will be removed from the CARE Program. Additionally, consistent with D and Public Utilities Code 739.1, the Company initiated a percent of Baseline Post Enrollment Verification for CARE customers. PacifiCorp implemented this procedure in November 2014 and is contracting with one of the CBOs to perform the required post-enrollment income verification in addition to the random verification of the CARE customers described above. 2. General Report The CARE Program penetration rate increased from 73 percent in 2012 to 83 percent in The increase is in part due to a new outreach effort of providing a direct mail piece to all residential non-care customers. The Company has reported no customer complaints associated with the CARE program. See Section II.B.2. for a discussion on the proposed budget for General administrative costs for PY Outreach Report PacifiCorp uses a variety of media for outreach. Traditionally, PacifiCorp distributes CARE program bill inserts in all residential bills in February and September each year. Bill 9 Ordering Paragraph

12 messages describing CARE are printed on all residential bills in February, September, October and November. The Company includes articles promoting CARE in "Voices," the Company's customer newsletter distributed in bills in January/February, March and September each year. In the budget cycle, the Company added several components to its outreach efforts. The Company used radio and print advertisements and began an annual direct mail campaign to distribute letters directly to non-care customers each autumn. The direct mail campaign appears to be an effective outreach method because the CARE participation rate increased by approximately seven percent. This is consistent with findings in The Low Income Needs Assessment 10 (Assessment), which indicates that low-income households prefer to be contacted by mail about programs. Table 4 shows the Outreach costs per average household served in each year, TABLE4 Outreach Costs per Household PY Costs Number of Households Cost per Household 2012 $50,267 10,064 $ $44,739 10,975 $ $45,038 11,552 $3.90 For PY , PacifiCorp will continue to promote the CARE Programs. The Company intends to continue to use the previously mentioned methods of outreach, which appear to be successful in emolling customers in the CARE Program. Additionally, the Company will work to enhance its relationships with the Yurok Tribal Housing Authority, Elk Valley Rancheria and Smith River Rancheria Housing Authority as well as the other local 10 Needs i 1 c.ssessment for the Energy Savings Assistance and the California Alternate Rates for Energy Programs, Volume 1: Summary Report. 12

13 agencies to leverage their assistance in promoting the Program. Further, the Company is continually looking for new methods of outreach and meets regularly with the other SMJUs and monitors the large lou's programs for suggestions on how to enhance penetration rates. D. OTHER CARE PROGRAM ELEMENTS In PY , PacifiCorp will implement several program administrative changes. PacifiCorp has developed a mechanism to track Processing/Certification!V erification costs. PacifiCorp will also begin random verification of CARE customer eligibility. Also new in this budget cycle the Company will incorporate the percent of Baseline Post Enrollment Verification process for CARE customers with the help of the partnering CBOs. PacifiCorp will continue to be active in its local communities and provide CARE information to promote the Program. III. ENERGY SAVINGS ASSISTANCE PROGRAM A. BACKGROUND The ESA Program is designed to provide energy efficiency services at no cost to incomequalifying homeowners and renters residing in single-family, multifamily and mobile homes. The objective of the ESA Program is to help income-qualified customers reduce their electric consumption and costs in their homes while increasing their comfort, health and safety. PacifiCorp has funded weatherization services since 1986 and partners with local CBOs to administer the program. Households with incomes at or below 200 percent of the federal poverty guidelines qualify for the ESA Program services as follows: Participants with electric heating systems are eligible for shell measures such as the installation of insulation and replacement windows and minor home repairs. 13

14 Participants with electric water heat can receive low-flow showerheads and aerators. All participants are eligible for measures such as the installation of compact fluorescent light bulbs and refrigerators. PacifiCorp is unique in California in that it is a single-fuel utility and there is no natural gas service available in the Company's service territory. This presents a challenge because there is not another utility with which the CBOs can leverage additional funding and efficiency services. Further, PacifiCorp estimates that less than 40 percent of its income-eligible customers use electric heat, which limits the amount of shell measures the ESA Program is able to fund. The Company partners with Great Northern Services (GNS) in Siskiyou County and Redwood Community Action Agency (RCAA) 11 serving Modoc and Del Norte Counties. RCAA is located in Eureka and travels to Modoc County in the summer to provide work to PacifiCorp customers. These CBOs also receive funding from the California Department of Community Services and Development (CSD) who administer state and federal LIHEAP and Department of Energy funds designated for low income weatherization services. The CBOs are able to leverage government grants with PacifiCorp ESA Program funds resulting in the installation of a full range of efficiency measures and an increase in the number of homes they are able to serve. The Company reimburses CBOs for 50 percent of the cost of energy efficiency measures installed when they have government grants to leverage and 100 percent when government funds are depleted. Additionally, the Company funds another 15 percent to cover the CBOs' administrative expenses. 11 Paci:!:1Corp began partnering with RCAA after another CBO, the Dei Norte Senior Center, iost its state program funding. 14

15 The Company reviewed the findings of the studies and working group recommendations in the consolidated proceeding to address CARE and ESA Programs for Pacific Gas & Electric, Southern California Edison Company, Southern California Gas Company, and San Diego Gas and Electric Company. 12 The Company agrees with findings in the Assessment that states that households that only have utility service from a single fuel are less likely to be treated by the ESA Program. The Assessment also indicates that 32 percent of California utility-served households are income-eligible for CARE and ESA. PacifiCorp's analysis of2010 U.S. Census data estimates that 39 percent of PacifiCorp customers are income-eligible, that is above the average noted in the Assessment. The Assessment also found that 93 percent of the state's lowincome households reside in counties that are classified as urban and seven percent are in rural counties and may be less likely to know they are eligible and/or less willing to take assistance from the utility. As previously stated, PacifiCorp's service territory is rural, with less than four customers per square mile. PacifiCorp's Program is largely focused on targeting such customers. PacifiCorp will continue to work with the CBOs to promote the ESA Program. In regards to the other studies, the Company participated in a workshop with Commission staff and other SMJUs to discuss findings from the studies. PacifiCorp also participated in numerous meetings with the SMJU s following the workshop and leading up to the preparation of this Application to review the studies in more detail and discuss what opportunities the SMJUs could leverage within their own programs. The Energy Education Study will be shared with the CBOs. The Company plans to discuss best-practices with the CBOs and provide funding to enhance their Energy Education program. PacifiCorp recovers its costs for the ESA Program through the public purpose charge in 12 A.ll , et al. 15

16 Tariff Schedule S-192. PacifiCorp is not requesting a change to the public purpose surcharge at this time. The Company will continue to monitor the Program and will file an advice letter to adjust the surcharge in October each year, if needed, as authorized in D B. ESA PROGRAM GOALS AND BUDGET 1. ESA Goals Since 1986, over 4,000 homes have been completed through this Program. PacifiCorp works with the CBOs to deliver energy efficiency services to income-qualifying customers, and plans to continue these partnerships. This delivery process is the most advantageous means of serving eligible customers in PacifiCorp's very rural and geographically-challenging serv1ce territory. Table 5 shows the number ofesa participants annually from TABLES ESA Completions in 2002 through 2014 Year ESA Participation Number * * * Ordering Paragraph

17 *Federal American Reinvestment and Recovery Act (ARRA) funds in 2010/2011/2012 augmented agency manpower and their ability to treat additional homes. The goal of the ESA Program is to deliver energy savings for eligible customers. Pacifi.Corp calculated energy savings for the ESA Program based on the actual measures installed with Company funding during PY and the number of homes estimated to be weatherized during PY Included in Attachment A-4, contained in Appendix A, is a table showing actual energy savings for PY and estimated energy savings for PY Pacifi.Corp has approximately 35,400 residential customers with 39 percent, or approximately 13,800, households estimated to be eligible to receive ESA Program services. Of these households, Pacifi.Corp estimates approximately 38 percent have electric heat. Pacifi.Corp's partnering CBOs have weatherized over 4,300 of these homes to date, ieaving an estimated 900 electrically-heated homes yet to be served. Non-electrically heated homes are not included in the estimate because there are no gas utility partnerships available in the Company's serv1ce area. In D , 14 the Commission directed the Company to strive to weatherize 500 lowincome households per year and increased Pacifi.Corp's budget for the PY as a result. The Commission did not set a specific goal for PY Although the CBOs continue to work diligently to provide weatherization services to income-eligible customers, the remaining number of electrically-heated homes inhabited by income eligible families to be served is decreasing and the current goal has not been achieved. The partnering CBOs state that it is becoming more difficult to identify income-eligible customers residing in homes with electric 14 Ordering Paragraph 4. 17

18 heat because the number of homes to be treated is lower and the population base is widelydispersed. PacifiCorp is working with the CBOs to help them identify additional homes to serve by providing lists of CARE Program customers for them to contact, and the Company will continue to promote the ESA Program. Additionally, the Company intends to commission a needs assessment study to review the number of homes remaining to be weatherized in its service territory. The results will allow for further refinement ofthe goal for the ESA Program. PacifiCorp's proposed goals take into account CBO capacity as well as the limited number of eligible customers residing in homes with electric heat and not yet served. It is important that an achievable goal be established. The estimate of electrically-heated homes to be completed per year to reach the 2020 goal is 150 homes. The completion of 150 homes per year will result in the projected 900 homes yet to be weatherized to be served over the next six years. Refer to Attachment A-1, contained in Appendix A, for the number of homes treated and weatherized in PY and the number of projected home to be treated and weatherized in py PacifiCorp will work with the CBOs to deliver efficiency services to the low income population, and plans to continue the existing CBO partnerships. Partnering with CBOs, with the ability to leverage PacifiCorp's ESA funds with other funding sources, and having the relationships with limited income households and the local communities will result in the most efficient and well-received means to serve PacifiCorp's customers. 2. ESA Budget Attachment A-2, contained in Appendix A, provides an overview of the ESA Program budget (adopted and actual) for PY and the proposed budget for PY

19 Table 6 shows the ESA budget, expenditures and number of homes completed for PY ; and the proposed budget and number of proposed completed homes for PY TABLE6 ESA Program Budget Ordered Budget 15 Actual Spent 2012 $937,500 $683, $937,500 $757, $937,500 $506,506 Proposed Budget 2015 $937, $950, $950,000 PacifiCorp tracks program revenues and expenses in the ESA Balancing Account. As of December 31, 2014, this account had a balance of $347,084. These funds will be carried over and used in PY A portion of these funds will be used for water saving measures due to the drought emergency declared by Governor Brown in early The ESA Program will continue its current offerings by providing faucet aerators, and low-flow showerheads. The Company is also proposing for homes with electric water heating to add a measure for thermostat-controlled shower valves which automatically switch the flow to a trickle when the water is warm. The Energy Education component will be reviewed with the agencies. A portion of the carry-over funding may be directed to the Energy Education component and a newly commissioned needs assessment study. 15 D

20 The Company's proposed budget for the ESA program is $937,500 for 2015 and $950,000 annually for 2016 and The budget for 2015 is based on the 2014 budget approved in D.l and the actual funding spent by the CBOs. PacifiCorp proposes increasing the ESA Program budget for PY 2016 and 2017 to take into account an increase in costs for installing Program energy efficiency measures and an increase in CBO Administrative costs over the final two years of the budget cycle. C. ESA PROGRAM DESIGN PacifiCorp's ESA Program funds measures that improve electric efficiencies for electrically-heated homes. The Company estimates that 38 percent of homes in its service territory are heated with electricity. CBO staff has confirmed that this is a reasonable estimate. Funding from PacifiCorp will cover costs of installing measures that reduce electricity consumption only. PacifiCorp is proposing to add three new measures during the PY budget cycle. The first measure being added is the thermostat-controlled shower valves previously mentioned, and the other measures are light-emitting diode (LED) bulbs for lighting and hardwired LED fixtures. LED lighting is proposed because it provides a substantially longer effective useful life than compact florescent lights. LED lights have become more accessible and their costs have decreased. D. ESA OUTREACH PacifiCorp's outreach efforts for the ESA Program are similar to the CARE Program and include bill inserts, bill messages and articles included in the Company's customer newsletter. Print and radio advertisements were added in PY A direct mail postcard, specifically promoting the ESA Program was also added and distributed to all residential customers. CBO 20

21 staff indicated that this postcard appears to be an effective method to promote the program and the Company will continue to distribute them annually through the PY budget cycle along with the outreach methods currently in effect. In 2015, PacifiCorp will begin providing lawn signs for display in front of homes being weatherized. Table 7 shows the actual outreach costs and the average outreach cost per completed dwelling in PY TABLE 7 ESA Program Outreach Costs Outreach Costs Number of Households Cost Per Household 2012 $19, $ $25, $ $16, $139 The Company will continue to use CBOs as the delivery mechanism for the ESA Program. The CBOs are in the best position to administer the program because they work with the low-income population on a daily basis and are best able to assess their overall needs. The Company will continue to monitor the developments in the large investor owned utilities' ESA and CARE proceedings. IV. REVENUE REQUIREMENT AND RATE IMPACTS A. BENEFITS AND COSTS, AFFECT ON PARTICIPANTS The ESA Program participants benefit from the Program through kilowatt hours savings, which decrease their monthly bills and PacifiCorp's generation requirements. Their homes are also safer because some minor repairs are performed by CBOs, and they are more comfortable because measures such as insulation, caulking and weather-stripping reduce drafts in the home. In PY , PacifiCorp spent approximately $1,947,000 and estimates that coliectively 21

22 participants reduced their usage by over 434,000 kwh (at site) which is $4.48 per kwh and is equivalent to supplying approximately 36 homes (with monthly usage of 1,000 kwh) with electricity for one year. 16 The costs and benefits of the CARE Program are based on the total CARE Program costs and CARE Program discount amount as shown in Appendix B, Attachment B-1. This table summarizes the total costs for PY and proposed amounts for PY The total program costs for PY was $9,717,329 and the total CARE Program discount for PY was $9,486,336. The discount provided to the CARE Program customers reduces their bills and thus reduces their energy burden, which is defined as the share of annual household income that is used to pay annual energy bills. Reducing this energy burden frees dollars to be spent elsewhere on other necessities and makes households better able to keep current on their energy bills. B. BALANCING ACCOUNTS, CHANGES The balance in the CARE Program balancing account as of December 31, 2014 is $674,990 and for the ESA Program the balance in the balancing account is $327,084. The Company will continue to monitor these accounts and will file an advice letter to adjust the surcharge(s) in October each year, if needed, as authorized in D.l V. REQUEST TO CONTINUE FUNDING AND ALLOW FOR FUND SHIFTING PacifiCorp respectfully requests authorization to continue the CARE Program and ESA Program funding and activities into PY , and the flexibility to manage the funds over each program year in the event of a delay in the Commission's decision. 16 S d.... A.... py ~ ~. ~ ee Attacnment A-4, contame m Appenaix, or actual energy savmgs aunng 2014 and projected energy savings for PY LUlL- 22

23 VI. OTHER ENERGY SAVINGS ASSISTANCE PROGRAM ELEMENTS In the PY , PacifiCorp will continue to work with the CBOs to provide weatherization services to its customers. PacifiCorp will work closely with them to identify eligible ESA Program participants to meet the program goal. VII. STATUTORY AND PROCEDURAL REQUIREMENTS A. APPLICANT AND CORRESPONDENCE {RULES 2.1(a) and (b)) PacifiCorp is a public utility organized and existing under the laws of the State of Oregon. PacifiCorp engages in the business of generating, transmitting, and distributing electric energy in portions of Northern California and in the states of Idaho, Oregon, Utah, Washington, and Wyoming. PacifiCorp's principal place of business is 825 NE Multnomah Street, Suite 2000, Portland, Oregon Communications regarding this application should be addressed to: Cathie Allen Regulatory Manager PacifiCorp 825 NE Multnomah Street, Suite 2000 Portland, Oregon Telephone: (503) Facsimile: (503) ============~ Michelle R. Mishoe Senior Counsel PacifiCorp 825 NE Multnomah Street, Suite 1800 Portland, Oregon Telephone: (503) Facsimile: (503) ~~~~~~~~~~~~~ 23

24 In addition, PacifiCorp respectfully requests that all data requests regarding this matter be addressed to: By (preferred): By regular mail: Data Request Response Center PacifiCorp 825 NE Multnomah, Suite 2000 Portland, OR B. STATUTORY AND PROCEDURAL AUTHORITY (RULE 2.1) Rule 2.1 requires that all applications state clearly and concisely the authorization or relief sought, cite by appropriate reference the statutory provision or other authority under which Commission authorization or relief is sought, and be verified by the applicant. The relief being sought is summarized in Sections I through VI and is further described in the appendices and attachments supporting this application. PacifiCorp's authority for this request includes, but is not limited to, Sections 382 and of the California Public Utilities Code, and prior decisions, orders and resolutions of the Commission. PacifiCorp's request is consistent with Rules 1.5 through 1.11 and 1.13, which specify the procedures for the filing of documents. In addition, this request is consistent with Rules 2.1 through 2. 7, which specify general requirements for applications. An officer of PacifiCorp has verified this application as required by Rules 1.11 and 2.1. C. PROPOSED CATEGORIZATION, NEED FOR HEARING, ISSUES TO BE CONSIDERED, AND PROPOSED SCHEDULE (RULE 2.1 (c)) Rule 2.l(c) requires PacifiCorp to state "[t]he proposed category for the proceeding, the need for hearing, the issues to be considered, and a proposed schedule." PacifiCorp proposes that the Commission classify this proceeding as "ratesetting." The issues in this proceeding relate to PacifiCorp's proposed budget for the C.AF,E Program and the ESA Program. 24

25 If no party objects to this Application, hearings may not be necessary. PacifiCorp's Application and supporting exhibits and appendices constitute a sufficient record for the Commission to base its decision without the need for hearings. However, PacifiCorp is prepared to provide such other information as the Commission may require during its review of this Application. PacifiCorp proposes the following schedule, which allows for expedited Commission resolution of the application: Application filed February 2, 2015 Protest/Responses to Application to be determined 17 Prehearing Conference April1, 2015 Scoping Memo May 1, 2015 Proposed Decision August 3, 2015 Comments on Proposed Decision August 24, 2015 Reply Comments on Proposed Decision August 31, 2015 Final Commission Decision September 17, D. ORGANIZATION AND QUALIFICATION TO TRANSACT BUSINESS (RULE 2.2) A certified copy ofpacificorp's Articles oflncorporation, as amended, and presently in effect, was filed with the Commission in A ll, which resulted in Commission issuance ofd and is incorporated by reference pursuant to Rule 2.2 of the Commission's Rules of Practice and Procedure. 17 In accordance with the Commission Rules of Practice and Procedure, Rule 2.6(a), a protest or response must be filed within 30 days of the date of the notice of the filing of the application fl.rst appears in the Daily Calendar. 25

26 E. LIST OF EXHIBITS AND APPENDICES PacifiCorp's submissions in this Application include the following, which are incorporated by reference: APPENDIX A Attachment A -1 Attachment A-2 Attachment A-3 Attachment A -4 ESAPROGRAM Energy Savings Assistance Program Treated and Weatherized Homes for PY and PY Energy Savings Assistance Program Budgets for PY Energy Savings Assistance Program Budgets for PY Increase/(Decrease) Over Prior Year Energy Savings Assistance Program Energy Savings APPENDIXB Attachment B-1 Attachment B-2 Attachment B-3 CARE PROGRAM CARE Proposed Program Budget for PY CARE Estimated Participation for PY CARE Proposed Program Budget for PY Cost per Household VIII. CONCLUSION The Company respectfully requests approval of its Application for California Alternative Rates for Energy and Energy Savings Assistance programs and budgets for PY Michelle R. Mishoe PacifiCorp 825 NE Multnomah, Ste 1800 Portland, OR Telephone: Facsimile: michelle.mishoe@pacificorp.com Attorney for PacifiCorp 26

27

28 APPENDIX A ENERGY SAVINGS ASSISTANCE PROGRAM

29 Attachment A-1 PacifiCorp Energy Savings Assistance Program Treated (T) and Weatherized (W) Homes Utility 2016 Utility 2017 Utility Utility Authorized 2012 Actual Authorized 2013 Actual 2014 Actual Projected Projected Projected T T/W* T T/W* T T/W* T T/W* T T/W* T T/W* PacifiCorp *PacifiCorp does not differentiate between treated and weatherized homes

30 Attachment A-2 PacifiCorp Energy Savings Assistance Program Budgets for PY carry 201acarry 2012 over from 2013 over from Utility Adopted Actual Adopted Actual Adopted 201'1,Actual Proposed Proposed Proposed Outreach $ 50,000 $ 19,863 $ 50,000 $ 25,640 $ 50,000 $ 16,922 $ 40,000 $ 40,000 $ 40,000 Inspections $ 5,000 $ 1,809 $ 5,000 $ 2,175 $ 5,000 $ 966 $ 5,000 $ 5,000 $ 5,000 Generall $ 125,000 $ 92,282 $125,000 $113,317 $ 125,000 $ 88,808 $145,000 $145,000 $145,000 Subtotal Admin $ 180,000 $113,954 $180,000 $141,132 $ 180,000 $106,696 $190,000 $190,000 $190,000 Weatherization* $ 757,500 $569,085 $757,500 $616,400 $ 757,500 $399,810 $742,500 $755,000 $755,000 Measures* $ $ $ $ $ $ $ - $ - $ - - Energy Education* $ - $ - $ - $ - $ - $ - $ 5,000 $ 5,000 $ 5,000 Subtotal Program $ 757,500 $569,085 $757,500 $616,400 $ 757,500 $399,810 $747,500 $760,000 $760,000 Total Program $ 937,500 $23!,~32 $683,039 $937,500 $ 392,179 $757,532 $ 937,500 :ti506,506 $937,500 $950,000 $950,000 *Weatherization includes the costs and budgets for Weatherization, Measures, and Energy Education. PacifiCorp does not differentiate between Weatherization and and Measure costs. The CBO partnering agencies provide Energy Education as part of weatherization services and costs. In PY the Company is proposing to provide additional dollars to supplement the Energy Education program and will be able to track these additional costs separately from Weatherization.

31 Attachment A-3 PacifiCorp Energy Savings Assistance Program Budgets for PY lncrease/(decrease) Over Prior Year mcrease 2014 Carry- (Decrease) Increase Increase Over(from 2016 Utility over Utility (Decrease) over 2017 Utility (Decrease) over Utility Authorized Actual 2013) Proposed Proposed Proposed 2015 Proposed Proposed 2016 Proposed Outreach $ 50,000 $ 16,922 $ 40,000 $ (10,000) $ 40,000 $. $ 40,000 $ lnspecticms $ 5,000 $ 966 $ 5,000 $. $ 5,000 $ - $ 5,000 $ General $ 125,000 $ 88,808 $ 145,000 $ 20,000 $ 145,000 $. $ 145,000 $ Subtotal Admin $ 180,000 $ 106,696 $ 190,000 $ 10,000 $ 190,000 $ - $ 190,000 $ Weatherization $ 757,500 $ 399,810 $ 742,500 $ (15,000} $ 755,000 $ 12,500 $ 755,000 $ Measures* $ - $ - $ - $ - $. $ - $ - $ Energy Education* $. $. $ 5,000 $ 5,000 $ 5,000 $ - $ 5,000 $ Subtotal Program $ 757,500 $ 399,810 $ 747,500 $ (10,000} $ 760,000 $ 12,500 $ 760,000 $ Total Program :p 937,500 :p 506,506 :p 406,178 :p 937,500 :jj 24,816 :p 950,000 :p 12,500 :jj 950,000 :p *Weatherization includes the costs and budgets for Weatherization, Measures, and Energy Education. PacifiCorp does not differentiate between Weatherization and Measure costs. The CBO partnering agencies provide Energy Education as part of weatherization services and costs. In PY the Company is proposing to provide additional dollars to supplement the Energy Education program and will be able to track these additional costs separately from Weatherization.

32 Attachment A-4 PacifiCorp Energy Savings Assistance Program Energy Savings 2012Actual 2013 Actual 2014Actual 2015 Estimated 2016 Estimated 2017 Estimated kwh kwh kwh kwh kwh kwh I 205, ,300 87, , , ,000

33 APPENDIXB CALIFORNIA ALTERNATE RATES FOR ENERGY PROGRAM

34 Attachment B-1 PacifiCorp CARE Proposed Program Budget for PY CARE Budget Categories Authorized Recorded Authorized Recorded Authorized 2014Actual Proposed Proposed Proposed Outreach $ 75,000 $ 50,267 $ 75,000 $ 44,739 $ 75,000 $ 45,038 $ 50,000 $ 50,000 $ 50,000 Pro./ Certification I and Verification $ 15,000 $ - $ 15,000 $ - $ 15,000 $ - $ 30,000 $ 30,000 $ 30,000 General $ 20,000 $ 15,422 $ 20,000 $ 26,237 $ 20,000 $ 33,868 $ 50,000 $ 50,000 $ 50,000 Total Expenses $ 110,000 $ 65,689 $ 110,000 $ 70,976 $ 110,000 $ 78,906 $ 130,000 $ 130,000 $ 130,000 CARE Progam Discount $ 2,975,094 $ 2,975,094 $ 3,076,631 $ 3,076,631 $ 3,434,611 $ 3,434,611 $ 3,626,530 $ 3,838,631 $ 4,113,397 Total Pmgram Costs $ 3,085,094 $ 3,040,783 $ 3,186,631 $ 3,147,607 $ 3,544,611 $ 3,513,517 $ 3,756,530 $ 3,968,631 $ 4,243,397

35 Attachment B-2 PacifiCorp CARE Estimated Participation for PY Total Enrolled py 2014 Total Enrolled 12 Through Estimated /31/2014 Eligible (Source) (1) (2) (3) Estimated Net py 2014 Enrollments (2)-(1) Estimated Year End PY 2014 Participation (col B+E) Estimated Net Estimated Year End Estimated Net Estimated Net Estimated PY py 2015 py 2015 Estimated PY 2015 py 2016 Estimated Year End Estimated PY 2016 py 2017 Estimated Year End Estimated PY Goal Rate Enrollments Participation Goa! Rate Enrollments PY 2016 Participation Goal Rate Enrollments PY 2017 Participation Goa! Rate (col F/0) (4) (col F+H) (coli/d) (4) (col. I+K) (col. L/D) (4) (col. L+N) (col. 0/0) ~. - 10,975 11,552 13, ,552 83% ,795 85% ,000 87% ,500 90% (1) CARE Annual Heport filed 5/1/2014 (2) Total based on 12/31/2014 actual enrollment (3) Actual CARE enrolled customers in 2014 (4) Each utility's estimate based on eligibility rates filed

36 Attachment B-3 - PacifiCorp CARE Proposed Program Budget for PY Cost per Household Cost per 2013 Cost per 2014 Cost per 2015 Cost per 2016 Cost per 2017 Cost per CARE Budget Categories Recorded Household Recorded Household Actual Household Proposed Household Proposed Household Proposed Household Number of 1-louseholds 10,064 10,975 11,552 11,795 12,000 12,500 Outreach $ 50,267 $ 4.99 $ 44,739 $ 4.08 $ 45,038 $ 3.90 $ 50,000 $ 4.24 $ 50,000 $ 4.17 $ 50,000 $ 4.00 Pro./ Certification I and Verification $ - $ - $ - $ - $ - $ - $ 30,000 $ 2.54 $ 30,000 $ 2.50 $ 30,000 $ 2.40 General $ 15,422 $ 1.53 $ 26,237 $ 2.39 $ 33,868 $ 2.93 $ 50,000 $ 4.24 $ 50,000 $ 4.17 $ 50,000 $ 4.00 Total Exp,enses $ 65,689 $ 6.53 $ 70,976 $ 6.47 $ 78,906 $ 6.83 $ 130,000 $ $ 130,000 $ $ 130,000 $ CARE Progam Discount $2,975,094 $ 3,076,631 $3,434,611 $3,626,530 $3,838,631 $4,113,397 Total Program Costs $3,056,205 ~.147,607 $3,513,517 $3,756,530 $3,968,631 $4,243,

37 BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA In the Matter of the Application of PacifiCorp (U 901-E) for Approval of the California Alternate Rates for Energy and Energy Savings Assistance Programs and Budgets for Program Years Application No (Filed February 2, 2015) CERTIFICATE OF SERVICE I hereby certify that I have this day served a copy of In the Matter of the Application of PacifiCorp (U 901-E) for Approval of the California Alternate Rates for Energy and Energy Savings Assistance Programs and Budgets for Program Years on all known parties to A , by transmitting an message with the document attached to each person named in the official service list. Acting Chief ALJ David M. Gamson will receive two paper copies via overnight delivery. (Service List last changed January 27, 2015) CATHERINE M. MAZZEO, ESQ. SOUTHWEST GAS CORPORATION 5241 SPRING MOUNTAIN RD. / PO BOX LAS VEGAS, NV catherine.mazzeo@swgas.com P VIDHYA PRABHAKARAN DAVIS WRIGHT & TREMAINE LLP 505 MONTGOMERY STREET, SUITE 800 SAN FRANCISCO, CA VidhyaPrabhakaran@dwt.com P RAYMOND J. CZAHAR WEST COAST GAS CO., INC BEATTY DR. SACRAMENTO, CA westgas@aol.com P DAVID KIRKLAND OPOWER ONLY ONLY, CA 0 david.kirkland@opower.com I KEITH SWITZER GOLDEN STATE WATER COMPANY 630 EAST FOOTHILL BOULEVARD SAN DIMAS, CA kswitzer@gswater.com P STEVEN F. GREENWALD DAVIS WRIGHT TREMAINE LLP 505 MONTGOMERY STREET, SUITE 800 SAN FRANCISCO, CA SteveGreenwald@dwt.com P MICHELLE R. MISHOE PACIFICORP 825 NE MULTNOMAH STREET, SUITE 1800 PORTLAND, OR michelle.mishoe@pacificorp.com P EMILY SANGI DAVIS WRIGHT TREMAINE ONLY ONLY, CA 0 emilysangi@dwt.com I Rashid A. Rashid CALIF PUBLIC UTILITIES COMMISSION 505 VAN NESS AVENUE SAN FRANCISCO, CA rhd@cpuc.ca.gov P MICHAEL LAMOND ALPINE NATURAL GAS COMPANY 15 ST. ANDREWS ROAD, SUITE 7 VALLEY SPRINGS, CA anginc@goldrush.com P CATHIE ALLEN PACIFICORP ONLY ONLY, OR 0 CaliforniaDockets@pacificorp.com I JOHN AIELLO ONLY ONLY, CA 0 electricrev@nctv.com I 1

38 DAVIS WRIGHT TREMAINE LLP ONLY ONLY, CA 0 dwtcpucdockets@dwt. com I KRISTIEN TARY SOUTHWEST GAS CORPORATION 5241 SPRING MOUNTAIN ROAD LAS VEGAS, NV Kristien.Tary@swgas.com I NGUYENQUAN BEAR VALLEY ELECTRIC SERVICE 630 EAST FOOTHILL BLVD. SAN DIMAS, CA N Quan@gswater. com I MATTHEW O'KEEFE OPOWER 760 MARKET STREET, 4TH FLOOR SAN FRANCISCO, CA california@opower.com I LIBERTY UTILITIES (FORMERLY CALPECO) LLC 933 ELOISE A VENUE SOUTH LAKE TAHOE, CA cpuc@libertyutilities.com I ANNA JEW CALIFORNIA PUBLIC UTILITIES COMMISSION ONLY ONLY, CA 0 anna.jew@cpuc.ca.gov s Alice Glasner CALIF PUBLIC UTILITIES COMMISSION 505 VAN NESS A VENUE SAN FRANCISCO, CA ag6@cpuc.ca.gov s David Peck CALIF PUBLIC UTILITIES COMMISSION 505 VANNESS AVENUE SAN FRANCISCO, CA dbp@cpuc.ca.gov s Kimberly Kim CALIF PUBLIC UTILITIES COMMISSION 505 VAN NESS A VENUE SAN FRANCISCO, CA kk2@cpuc.ca.gov s BROOKS CONGDON SOUTHWEST GAS CORPORATION 5241 SPRING MOUNTAIN ROAD, LVB-100 LAS VEGAS, NV brooks.congdon@swgas.com I FRED G. Y ANNEY YANNEY LAW OFFICE MARQUARDT AVE. UNIT C- 4 CERRITOS, CA FredYanney@gmail.com I DANIELLE DECLERCQ BEAR VALLEY ELECTRIC SERVICE GARSTIN DRIVE I PO BOX 1547 BIG BEAR LAKE, CA danielle.declercq@lbves.com HILLARY CORRIGAN CALIFORNIA ENERGY MARKETS 425 DIVISADERO STREET, SUITE 303 SAN FRANCISCO, CA cem@newsdata. com I MARIS A DECRISTOFORO PACIFICORP 825 NE MUL TNOMAH STREET, SUITE 800 PORTLAND, OR Marisa.Decristoforo@PacifiCorp.com I STEPHANIE HARRIS CPUC ONLY ONLY, CA 0 sh4@cpuc.ca.gov s Christopher Clay CALIF PUBLIC UTILITIES COMMISSION 505 VAN NESS A VENUE SAN FRANCISCO, CA cec@cpuc.ca.gov s Hazlyn Fortune CALIF PUBLIC UTILITIES COMMISSION 505 VAN NESS A VENUE SAN FRANCISCO, CA hcf@cpuc.ca.gov s Rahmon Momoh CALIF PUBLIC UTILITIES COMMISSION 505 VAN NESS A VENUE SAN FIV\NCISCO, CA rmm@cpuc.ca.gov s 2 CELINEAPO SOUTHWEST GAS COMPANY 5241 SPRING MOUNTAIN ROAD LAS VEGAS, CA celine.apo@swgas.com I ALLANRAGO QUALITY CONSERVATION SERVICES 4751 ARROW HIGHWAY MONTCLAIR, CA arago@qcsca.com I DENISE WALKER BEAR VALLEY ELECTRIC SERVICE GARSTIN DR./PO BOX 1547 BIG BEAR LAKE, CA dwalker@bves.com I BOB DODDS 933 ELOISE A VENUE SOUTH LAKE TAHOE, CA Bob.Dodds@liberty-energy.com I AMY BAKER CALIFORNIA PUBLIC UTILITIES COMMISSION ONLY ONLY, CA 0 amy.baker@cpuc.ca.gov s TORY FRANCISCO CALIFORNIA PUBLIC UTILITIES COMMISSION ONLY ONLY, CA 0 tnf@cpuc. ca. gov s Colette Kersten CALIF PUBLIC UTILITIES COMMISSION 505 VAN NESS A VENUE SAN FRANCISCO, CA cek@cpuc.ca.gov s Karen Camille Watts-Zagha CALIF PUBLIC UTILITIES COMMISSION 505 VAN NESS A VENUE SAN FRANCISCO, CA kwz@cpuc.ca.gov s Syreeta Gibbs CALIF PUBLIC UTILITIES COMMISSION 505 VAN NESS A VENUE SAN FRANCISCO, CA syg@cpuc.ca.gov s