Rulemaking (R.) 12-01-005 – Incentive Mechanism – continued implementation of reforms to the incentive mechanism as a successor docket to R.09-01-019. Under this Rulemaking, the 2010-12 and 2013-14 incentive mechanisms were adopted in D.12-12-032 and D.13-09-023, respectively.
In D.12-12-032, the Commission approved a 2010-12 incentive mechanism to award the utilities with a management fee equal to 5% of actual energy efficiency portfolio expenditures plus a performance bonus of up to an additional 1% of portfolio expenditures for conformance with the Commission-adopted ex ante review requirements.
In D.13-09-023, the Commission adopted the Efficiency Savings and Performance Incentive (ESPI) mechanism. The ESPI awards the IOUs for performance in both non-resource and resource activities, as follows:
1. Non-resource programs – management fee equal to 3% of non-resource program expenditures, not to exceed authorized expenditures;
2. Codes and standards programs – management fee equal to 12% of codes and standards program expenditures, not to exceed authorized expenditures;
3. Ex ante performance – performance-based award of up to 3% of resource program expenditures (minus codes and standards program expenditures); and
4. Energy savings – performance-based award of up to 9% of resource program expenditures (minus codes and standards program expenditures)
All expenditure amounts would exclude funding dedicated to administrative activities; regional energy networks (RENs); community choice aggregator (CCA); and EM&V activities.
The Commission closed R.12-01-005 with the approval of D.13-09-023.
R.09-01-019 - Risk/Reward Incentive Mechanism (RRIM) - In D.07-09-043, the Commission authorized a RRIM, under which utilities would be rewarded/penalized based on evaluated energy savings for the 2006-2008 and subsequent program cycles. See R.09-01-019 for all Commission decisions regarding incentive payments for the 2006-2008 program cycle and modifications to D.07-09-043.
Energy Division 2009 RRIM White Paper - Energy Division proposal for reworking the Risk Reward Incentive Mechanism established in D.07-09-043.