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PG&E’s Operating Experience with TVP Rates

PG&E’s Operating Experience with TVP Rates. Best Practices and Lessons Learned in Time-Variant Pricing R.12-06-013 Residential Rate Workshop. “TVP Load and Bill Impacts, Role of Technology, and Operational Considerations” 1:00 – 2:45pm July 30, 2014. Gregory B. Mandelman

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PG&E’s Operating Experience with TVP Rates

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  1. PG&E’s Operating Experience with TVP Rates Best Practices and Lessons Learned in Time-Variant Pricing R.12-06-013 Residential Rate Workshop “TVP Load and Bill Impacts, Role of Technology, and Operational Considerations” 1:00 – 2:45pm July 30, 2014 Gregory B. Mandelman Customer Energy Solutions Research and EvaluationPacific Gas & Electric Co.

  2. PG&E Has Multiple Years of Experience Operating Opt-In Residential TVP Rates • SmartRate™ (Opt-In CPP) has grown from 8,800 customers at the end of 2008 to 130,000 today • Average annual aggregate load impacts increased from 3.5 MW to 44 MW between 2008 and 2013 due to targeted marketing • Load impacts are persistent year-over-year and within a given season when weather and customer mix are taken into account • Between 2012 to 2014, enrollments grew by 110,000 customers by leveraging lessons learned on SmartRate targeted direct mail marketing techniques • On average, SmartRate customers save up to $73 (CARE) and $75 (Non-CARE) on their summer bill, compared to the standard tiered rate • PG&E’s Opt-In TOU Rates have grown to about 112,000customers* • Most recent load impact conducted for Schedules E-6 and E-7 include 59,000 non-NEM customers • Average annual aggregate load impacts ranged between 5.8 MW to 7 MW between 2012 and 2013 • Enrollments, peaking at 130,000 customers in 1995 for E-7, have been largely driven by rate design, low pre-AMI meter charges and rate availability • Net Energy Metering participation, evaluation methods and changing enrollment options complicate research on PG&E’s opt-in TOU rates • On average, E-6 and E-7 customers save up to $236 on their annual bill compared to the standard tiered rate * PG&E has three residential TOU rates that are open to new enrollments: E-6, EV-A and EV-B. E-6 is a tiered TOU rate, with 80% solar participation. EV-A and EV-B are electric vehicle rates. There are three TOU rates that are closed to new enrollments: E-7, E-9A and E-9B. E-7 is a tiered TOU rate, with 20% solar participation.E-9A and E-9B are electric vehicle rates.

  3. 2013 SmartRate Research Insights – Part 1 • Performance by Climate and Geography: Temperature Matters • Average customer load impacts were 21% • Reductions across the PG&E service territory ranged from 15% in coolest area up to 28% in the hotter regions • SmartRate + SmartAC = Nearly Twice the Load Impacts • On average, dually enrolled customers provide a 29% drop in demand • This is almost twice as much load reduction as SmartRate-only customers, who reduce by 16% • Low-Income Customers: Perform Better with Direct Load Control • CARE customers enrolled in both SmartRate + SmartAC provide roughly the same percentage load reductions, 27%, as dually enrolled non-CARE customers, 29% • SmartRate-only CARE customers provide an average of 7% load reduction, compared to a 19% reduction for SmartRate-only Non-CARE customers • PG&E Service Area = 70,000 sq. miles • Residential Population = 4.6 million • Baseline Territories = 10

  4. 2013 SmartRate Research Insights – Part 2 • Targeting Marketing: Enrolling High Performing Customers in the Bay Area • Overall targeting focuses on those with greatest load to shed (hot areas) and high propensity to enroll • Carefully target marketing within hotter micro climates of the Bay Area increased average per customer load reduction between 2012 and 2013 • SmartRate-only customers increased by roughly 80%, from 0.10 kW in 2012 to 0.18 kW in 2013 • SmartRate + SmartAC customers increased reductions by 75%, from 0.28 kW to 0.49 kWbetween 2012 and 2013 • Structural Winners: More Likely to Enroll and Perform Well • Structural winners who are told that they will do well on SmartRate are more likely to enroll compared to winners that are not told (5% enrollment vs. 4%) • Importantly, their percentage load reductions are right in line with average SmartRate customers (21%) • Event Day Notification: Greater Engagement Leads to Better Impacts • SmartRate-only customers who receive four successful notifications provide 31% reductions, compared to 4% for those who do not sign-up for any form of notification • Dually enrolled customers who were successfully notified four times generated 37% reduction, verses 19% for dually enrolled participants who received no notifications

  5. Questions Greg Mandelman gregory.mandelman@pge.com 415-973-4778

  6. References • “2009 Load Impact Evaluation for Pacific Gas and Electric Company’s Residential SmartRate-Peak Day Pricing and TOU Tariffs and SmartAC Program: Volume 1: Ex Post Load Impacts” • Freeman, Sullivan & Company, April 1, 2010, R.13-09-011 • https://www.pge.com/regulation/DemandResponseOIR/Other-Docs/PGE/2010/DemandResponseOIR_Other-Doc_PGE_20100401-01.zip • https://www.pge.com/regulation/DemandResponseOIR/Other-Docs/PGE/2010/DemandResponseOIR_Other-Doc_PGE_20100401-02.zip • “2010 Load Impact Evaluation of Pacific Gas and Electric Company’s Time-Based Pricing Tariffs” • Freeman, Sullivan & Company, April 1, 2011, R.13-09-011 • https://www.pge.com/regulation/DemandResponseOIR/Other-Docs/PGE/2011/DemandResponseOIR_Other-Doc_PGE_20110401_208487.zip • “2011 Ex Post Load Impact Evaluation of Pacific Gas and Electric Company’s Residential Time-based Pricing” • Freeman, Sullivan & Company, March 29, 2012, R.13-09-011 • https://www.pge.com/regulation/DemandResponseOIR/Other-Docs/PGE/2012/DemandResponseOIR_Other-Doc_PGE_20120601_239253.zip • “2012 Load Impact Evaluation of Pacific Gas and Electric Company’s Residential Time-based Pricing Programs” • Freeman, Sullivan & Company, April 1, 2013, R.13-09-011 • https://www.pge.com/regulation/DemandResponseOIR/Other-Docs/PGE/2013/DemandResponseOIR_Other-Doc_PGE_20130402_269622.zip • “2013 Load Impact Evaluation of Pacific Gas & Electric Company’s Residential Time-based Pricing Programs” • Nexant, April, 1, 2014, R.13-09-011 • https://www.pge.com/regulation/DemandResponseOIR-2013/Pleadings/PGE/2014/DemandResponseOIR-2013_Plea_PGE_20140401_300478.zip • “Report on SmartRate™ and TOU Tariffs,” PG&E Rate Design Window 2012, Appendix A, Volume 1, Report in Compliance with D.11-11-003 OP 3 • PG&E, February 29, 2012, A.12-02-020 • https://www.pge.com/regulation/RateDesignWindow2012/Testimony/PGE/2012/RateDesignWindow2012_Test_PGE_20120229_230078.pdf

  7. Appendix

  8. PG&E’s Residential TOU RatesE-7 and E-7 E-7 Opened: 1986 Closed: 2008 Summer Periods:2 Summer Peak: 12pm – 6pm Rev. Neutral: No E-6 Opened: 2006 Closed: No Summer Periods:3 Summer Peak: 1pm – 7pm Rev. Neutral: Yes

  9. PG&E’s Residential CPP RatesSmartRate™ SmartRate™ Opened: 2008 Closed: No Peak Period:2pm – 7pm Peak Adder: ¢60/kWh Rev. Neutral: No

  10. Load Impact Persistence? Yes.Year-Over-Year: SmartRate impacts are steady and driven by temperature and customer mix During 2012 and 2013, PG&E began actively target marketing to high performing customers, which led to increased percentage load reductions despite cooler temperatures Between 2008 and 2011, impact track very close to reduce event season temperature

  11. Load Impact Persistence? Yes.Within Season: SmartRate impacts remain steady when called back-to-back over three days Decline associated with a significant 7 degree reduction in temperature between the last two event days

  12. SmartRate: Snap Back? Not Really.All SmartRate Customers exhibit minimal Snap Back

  13. Humboldt N = 1,128 % LI = 15% kW LI = 0.25 kW How Do Different Groups Perform? Look here.Six Years of Data: Explores load impacts, bill impacts, low-income, climate, technology, structural winners North Coast N = 5,248 % LI = 19% kW LI = 0.22 kW Sierra N = 9,718 % LI = 28% MW LI = 0.68 kW Stockton N = 9,264 % LI = 20% kW LI = 0.49 kW Greater Fresno N = 9,582 % LI = 20% kW LI = 0.56 kW Other* N = 22,470 % LI = 21% kW LI = 0.40 kW Kern N = 8,701 % LI = 16% kW LI = 0.42 kW Greater Bay Area N = 52,034 % LI = 22% kW LI = 0.27 kW

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