California Utilities DSM Bidding Program

Vantage was selected by the State of California Public Utilities Commission (CPUC) through the Commission Advisory and Compliance Division (CACD) to conduct a financial assessment associated with the administrative functions and costs of the Demand-Side Management (DSM) bidding program for the Pacific Gas and Electric Company (PG&E), San Diego Gas and Electric Company (SDG&E), Southern California Edison Company (SCE), and Southern California Gas Company (SCG). In conducting this audit, CACD, the utilities, and Vantage recognized the changes taking place within the California utility industry which are having an impact on future DSM programs.

As our team came to recognize that the role of Energy Service Companies (ESCOs), their relationship with utilities, and their need for administrative services were changing, we met with CACD representatives, the assigned Administrative Law Judge (ALJ), and the utility representatives to determine how this assessment could be of greatest value to all parties. Therefore, in addition to meeting the requirements of the CPUC Order and the Request For Proposal, the report reflects our understanding of how these changes may impact administrative cost issues in the future.

The project was organized into four major tasks that are defined as follows:

Establish Benchmarks - developed a preliminary assessment of the costs offered by each utility for comparison.
Monitor Administrative Functions - reviewed the methodologies employed by each of the utilities in developing and using their administrative services.
Compare Utility Cost Functions - required a comparison of the administrative costs across and between the four utilities, as well as by the ESCOs themselves.
Develop Recommended Fee Schedules - made a series of recommendations that support a framework for ensuring the fair and equitable provision of administrative services for future DSM programs of this type.


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