public utilities commission of the state of …...time-related demand (trd) charges and no...

P.O. Box 800 8631 Rush Street Rosemead, California 91770 (626) 302-9645 Fax (626) 302-6396

December 15, 2020

ADVICE 4370-E (U 338-E)

PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA ENERGY DIVISION

SUBJECT: Information-Only Advice Letter, Southern California Edison Company’s Report on Option E Rates for Medium and Large Commercial Customers

PURPOSE

Pursuant to Ordering Paragraph (OP) 9 of California Public Utilities Commission (Commission or CPUC) Decision (D.)18-11-027, Southern California Edison Company (SCE) hereby submits this information-only Advice Letter (AL) to provide an annual report on SCE’s Option E rates for medium and large commercial customers. Included in the report are marketing materials for Option E rates, customer enrollments, and rate impact information for both Option E participants and non-participants.

BACKGROUND AND DISCUSSION

On December 7, 2018, the Commission issued D.18-11-027 to adopt marginal cost, revenue allocation and rate design related issues raised in A.17-06-030 (the Decision). The Decision approved all the settlements filed in the proceeding and approved the creation of two main forms of rate design for SCE’s medium and large commercial customers: Option D rates and Option E rates. Option D is the base rate design for all customers with Option E provided as an optional rate1 that features lower generation time-related demand (TRD) charges and no distribution TRD charges. The Option E rate is also designed with lower non-coincident demand charges that may benefit certain customer groups who would not otherwise respond well to the peak demand charge. Both Options D and E were implemented and made available to customers as of March 1, 2019.2 1 For TOU-8, Option E eligibility is limited to those with qualifying distributed energy

resources (DER) technologies and all technologies that are eligible under the old Option A and Option R rates. Option E is available without limitation to Schedule TOU-GS-2 and TOU-GS-3 customers.

2 Advice 3957-E.

Gary A. Stern, Ph.D. Managing Director, State Regulatory Operations

ADVICE 4370-E (U 338-E) - 2 - December 15, 2020

The Decision ordered SCE to “provide Energy Division with an information-only Tier 1 advice letter enclosing SCE’s marketing material for the Option E rates for MLP customers, the total customer enrollments in Option E in each of the TOU-GS-2, TOU--GS-3, and TOU-8 tariffs, the bill impacts for customers that switch to Option E, and the rate impact on non-Option E customers due to customer enrollment on Option E in each of the TOU-GS-2, TOU-GS-3, and TOU-8 tariffs.”3 SCE is ordered to file an Tier 1 advice letter for Option E annually by the end of 2019, 2020, 2021, and 2022. SCE hereby submits each requirement listed in OP 9 of the Decision as follows:

- SCE’s marketing materials for the Option E rate for Schedules TOU-GS-2, TOU-GS-3, and TOU-8 in Attachment A.

- The total customer enrollments, bill impacts for enrolled customers, and rate impact on non-participants are included in the Tables below.

For the purpose of the rate impact analysis, SCE extracted recorded data for customers who have enrolled on Option E since October 1, 2019. The revenue shortfalls associated with customers opting into Option E rates instead of electing to be on the base (Option D) rates are estimated with the following assumptions:

1. Customer enrollment on Option E as of September 2020 2. The customers’ usage data for the period of October 2019 through September

2020 3. Effective rates as of October 1, 20204 are used for rate impact analysis for both

participants and non-participants 4. Bill estimates of Option E net energy metering (NEM) customers are calculated

using delivered load (kWh)

Base on the stated criteria above, SCE calculated the customers’ annual revenues under their elected Option E and the would-be default Option D tariffs. See Table 1 below for the summary:

Table 1

3 D.18-11-027, p. 38. 4 Advice 4301-E.

Distribution URG Other Total Distribution URG Other Total

Estimated Annual

Revenues Deficiency

Estimated Annual Impact -

%A B C D F G H I = F + G + H J K L M = J + K + L N = I - M O = N / M

TOU-GS-2 24,112 1,214 2,167,388 $197,782 $149,141 $85,693 $432,616 $218,730 $159,670 $85,693 $464,093 ($31,477) -6.8%TOU-GS-3 1,185 353 741,796 $54,398 $42,807 $29,620 $126,825 $61,489 $45,237 $29,620 $136,346 ($9,521) -7.0%TOU-8 (Non-Standby) 62 86 209,774 $10,383 $11,100 $8,042 $29,525 $12,100 $12,824 $8,042 $32,966 ($3,441) -10.4%Total 25,359 1,652 3,118,959 $262,563 $203,048 $123,356 $588,966 $292,319 $217,731 $123,356 $633,405 ($44,438) -7.0%

Rate Groups

Number of Option E

participantsAnnual Max

MW

Annual Delivered

MWh

Estimated Annual Revenues - $000Option E Option D


Column B in Table 1 shows the total customer enrollments on Option E, and Column O shows the bill impacts for these enrolled customers. The TOU-8 (non-standby) rate group represents the consolidation of all customers in the TOU-8-SEC, TOU-8-PRI, and TOU-8-SUB non-standby subgroups given the small number of customers in each subgroup.5 The resulting revenue deficiencies attributed to customers enrolled on Option E, shown in Table 1 column N above are to be contained within the individual rate class in which the deficiency exists.6 The distribution revenue shortfalls, or column F minus column J shown in Table 1, will be allocated to customers on both bundled and unbundled services. The Utility Retained Generation (URG) revenue shortfalls, or column G minus column K shown in Table 1, will be allocated to bundled service customers only. See Table 2 and Table 3 (and specifically columns G2 and G3) below for the summary of annual impact to all non-participating customers in Option E as a result of the shortfall associated with customers participating in Option E rates. The estimated $44.4 million annual revenue deficiency in Table 1 Option E, column N assumes 12 months usage. SCE will update the optional rates revenue deficiencies calculation prior to the implementation of 2021 ERRA rate change to be included in rate recovery.

5 According to 15/15 Rule requirement. 6 Revenue Allocation Settlement Agreement (A.17-06-030), p.21 n.10.

Rate GroupsEstimated # of

Customers Annual MWhEstimated cents/kWh

Estimated Subsidy due to

Option E Revenue

Deficiency - cents/kWh

Estimated Average Rate with Subsidy -

cents/kWh

Estimated Average Rate

Impact - %A2 B2 C2 D2 E2 F2 = D2 + E2 G2 = F2 / D2

TOU-GS-2 70,561 8,998,279 20.35 0.27 20.62 1.35%TOU-GS-3 5,250 4,370,703 18.05 0.15 18.20 0.83%TOU-8-SEC (Non-Standby) 1,596 4,817,949 16.15 0.01 16.16 0.06%TOU-8-PRI (Non-Standby) 459 2,962,747 14.62 0.04 14.66 0.27%TOU-8-SUB (Non-Standby) 81 2,771,449 9.68 0.04 9.71 0.38%

Rate GroupsEstimated # of

Customers Annual MWhEstimated cents/kWh

Estimated Subsidy due to

Option E Revenue

Deficiency - cents/kWh

Estimated Average Rate with Subsidy -

cents/kWh

Estimated Average Rate

Impact - %A3 B3 C3 D3 E3 F3 = D3 + E3 G3 = F3 / D3

TOU-GS-2 22,600 4,347,947 11.31 0.16 11.47 1.39%TOU-GS-3 2,416 3,091,836 9.50 0.10 9.59 1.00%TOU-8-SEC (Non-Standby) 858 3,238,504 9.02 0.01 9.02 0.06%TOU-8-PRI (Non-Standby) 256 2,477,119 7.78 0.02 7.80 0.24%TOU-8-SUB (Non-Standby) 52 3,211,755 4.12 0.00 4.13 0.11%

1/ B2, C2, D2 = Calculated results from Advice 4301-E, effective October 1, 20201/ E2 = (F minus J) / (C2 + C3) + (G minus K) / C22/ B3, C3, D3 = Calculated results from Advice 4301-E, effective October 1, 20202/ E3 = (F minus J) / (C2 + C3)

Table 2Bundled Services 1/

Table 3Unbundled Services 2/


No cost information is required for this advice letter. This advice letter will not increase any rate or charge, cause the withdrawal of service, or conflict with any other schedule or rule. TIER DESIGNATION Pursuant to OP 9 of D.18-11-027, this advice letter is submitted with a Tier 1 designation. NOTICE In accordance with GO 96-B, General Rule 6.2, this information-only advice letter is not subject to protest. In accordance with General Rule 4 of GO 96-B, SCE is serving copies of this advice letter to the interested parties shown on the attached GO 96-B and A.17-06-030 service lists. Address change requests to the GO 96-B service list should be directed by electronic mail to [email protected] or at (626) 302-4039. For changes to all other service lists, please contact the Commission’s Process Office at (415) 7032021 or by electronic mail at [email protected]. Further, in accordance with Public Utilities Code Section 491, notice to the public is hereby given by submitting and keeping the advice letter at SCE’s corporate headquarters. To view other SCE advice letters submitted with the Commission, log on to SCE’s web site at https://www.sce.com/wps/portal/home/regulatory/advice-letters. For questions, please contact Alexander Echele at (626) 302-4856 or by electronic mail at [email protected].

Southern California Edison Company

/s/ Gary A. Stern, Ph.D. Gary A. Stern, Ph.D.

GAS:el:jm Enclosures


Attachment A

ADVICE LETTER S U M M A R YENERGY UTILITY

Company name/CPUC Utility No.:

Utility type:Phone #:

EXPLANATION OF UTILITY TYPE

ELC GAS

PLC HEAT

MUST BE COMPLETED BY UTILITY (Attach additional pages as needed)

Advice Letter (AL) #:

WATERE-mail: E-mail Disposition Notice to:

Contact Person:

ELC = ElectricPLC = Pipeline

GAS = GasHEAT = Heat WATER = Water

(Date Submitted / Received Stamp by CPUC)

Subject of AL:

Tier Designation:

Keywords (choose from CPUC listing):AL Type: Monthly Quarterly Annual One-Time Other:If AL submitted in compliance with a Commission order, indicate relevant Decision/Resolution #:

Does AL replace a withdrawn or rejected AL? If so, identify the prior AL:

Summarize differences between the AL and the prior withdrawn or rejected AL:

Confidential treatment requested? Yes NoIf yes, specification of confidential information:Confidential information will be made available to appropriate parties who execute a nondisclosure agreement. Name and contact information to request nondisclosure agreement/access to confidential information:

Resolution required? Yes No

Requested effective date: No. of tariff sheets:

Estimated system annual revenue effect (%):

Estimated system average rate effect (%):

When rates are affected by AL, include attachment in AL showing average rate effects on customer classes (residential, small commercial, large C/I, agricultural, lighting).

Tariff schedules affected:

Service affected and changes proposed1:

Pending advice letters that revise the same tariff sheets:

1Discuss in AL if more space is needed.

CPUC, Energy DivisionAttention: Tariff Unit505 Van Ness AvenueSan Francisco, CA 94102 Email: [email protected]

Protests and all other correspondence regarding this AL are due no later than 20 days after the date of this submittal, unless otherwise authorized by the Commission, and shall be sent to:

Name:Title:Utility Name:Address:City:State:Telephone (xxx) xxx-xxxx:Facsimile (xxx) xxx-xxxx:Email:

Name:Title:Utility Name:Address:City:State:Telephone (xxx) xxx-xxxx: Facsimile (xxx) xxx-xxxx:Email:

Zip:

Zip:

mailto:EDTariffUnit%40cpuc.ca.gov?subject=

ENERGY Advice Letter Keywords

Affiliate Direct Access Preliminary StatementAgreements Disconnect Service ProcurementAgriculture ECAC / Energy Cost Adjustment Qualifying FacilityAvoided Cost EOR / Enhanced Oil Recovery RebatesBalancing Account Energy Charge RefundsBaseline Energy Efficiency ReliabilityBilingual Establish Service Re-MAT/Bio-MATBillings Expand Service Area Revenue AllocationBioenergy Forms Rule 21Brokerage Fees Franchise Fee / User Tax RulesCARE G.O. 131-D Section 851CPUC Reimbursement Fee GRC / General Rate Case Self GenerationCapacity Hazardous Waste Service Area MapCogeneration Increase Rates Service OutageCompliance Interruptible Service SolarConditions of Service Interutility Transportation Standby ServiceConnection LIEE / Low-Income Energy Efficiency StorageConservation LIRA / Low-Income Ratepayer Assistance Street LightsConsolidate Tariffs Late Payment Charge SurchargesContracts Line Extensions TariffsCore Memorandum Account TaxesCredit Metered Energy Efficiency Text ChangesCurtailable Service Metering TransformerCustomer Charge Mobile Home Parks Transition CostCustomer Owned Generation Name Change Transmission LinesDecrease Rates Non-Core Transportation ElectrificationDemand Charge Non-firm Service Contracts Transportation RatesDemand Side Fund Nuclear UndergroundingDemand Side Management Oil Pipelines Voltage DiscountDemand Side Response PBR / Performance Based Ratemaking Wind PowerDeposits Portfolio Withdrawal of ServiceDepreciation Power Lines

Company Name: Southern California Edison Company (U 338-E)Phone: (626) 302-2086ELC: YesGas: OffWater: OffEmail: [email protected]: OffHeat: OffEmail Disposition Notice: [email protected] Person: Darrah MorganDate Submitted: Advice Letter #: 4370-ETier Designation: 1Subject of AL: Information-Only Advice Letter, Southern California Edison Company’s Report on Option E Rates for Medium and Large Commercial CustomersKeywords: ComplianceMonthly: OffQuarterly: OffAnnual: OffOne-Time: YesOther: OffOther text field: AL Commission Order: Decision 18-11-027Prior AL: Confidential treat - NO: YesDifferences: Confidential treat - YES: OffConfidential info: Confidential contact: Resolution YES: OffResolution NO: YesEffective date_af_date: No: of Tariff Sheets: -0-

Estimated revenue effect: Estimated rate effect: Tariff Schedules Affected: NoneService affected: Pending advice letters: NoneClear Form: Email 2: [email protected] 2: (415) 929-5544Telephone 2: Zip 2: 94102City 2: San FranciscoAddress 2: 601 Van Ness Avenue, Suite 2030Utility Name 2: Southern California Edison CompanyTitle 2: Managing Director, Regulatory RelationsName 2: Tara S. Kaushik c/o Karyn GanseckiState 2: [California]Email 1: [email protected] 1: (626) 302-6396Telephone 1: (626) 302-9645Zip 1: 91770State 1: [California]Name 1: Gary A. Stern, Ph.D.City 1: RosemeadAddress 1: 8631 Rush StreetUtility Name 1: Southern California Edison CompanyTitle 1: Managing Director, State Regulatory Operations

public utilities commission of the state of …...time-related demand (trd) charges and no...

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