Peak Off-Peak Ratio % Discount (Pk/SOP) (SOP)* Tier 1 18.1 cents 12.6 cents 6.1 cents Tier 2 28.7 cents 23.2 cents 16.7 1.72 17% Hypothetical 25 cents 18 cents 10 cents 2.5 50% untiered rate** *relative to an estimated 20 cent average non-CARE residential rate **This hypothetical rate is intended to illustrate the type of rate that could provide adequate incentive to increase consumption in super-off-peak periods. While SCE’s Tier 1 rates seem attractive, a majority of customers consume more than baseline quantities in some months, and therefore pay Tier 2 rates during those months. We find that SCE’s Tier 2 spring weekday super-off-peak rates (16.7 cents per kWh) are too high to provide adequate incentive to increase consumption in super-off-peak periods. Furthermore, offering a 50% discount relative to the average residential rate as illustrated in Table 1 would be unlikely to violate the rate floor consisting of the sum of nonbypassable costs (NBCs) and marginal costs. By this Resolution, we therefore order SCE to file a supplemental advice letter proposing an optional TOU rate that is revenue neutral to its Rate 3 proposal, has the same TOU periods and seasons as the proposed Rate 3, but does not contain a baseline credit. For non-CARE customers, the untiered Rate 3 proposal must have a super-off-peak rate that is at least 50% below the seasonal average CARE residential rate. For CARE customers, the untiered Rate 3 proposal must have a super-off-peak rate that is at least 50% below the seasonal average CARE residential rate. Both non-CARE and versions of the untiered Rate 3 must have a ratio of seasonal peak to super-off-peak rate of at least 2.5. While this approach would distinguish SCE’s Rate 3 from the other IOUs’ TOU pilot rates and the control group, we believe that there is sufficient comparability to obtain reliable and useful results about the differential load and billing impacts across each service territory with and without a baseline credit. Essentially, the comparison of SCE’s Rate 3 group to the control group would test
Peak Off-Peak Ratio (Pk/SOP) % Discount (SOP)* Tier 1 18.1 cents 12.6 cents 6.1 cents Tier 2 28.7 cents 23.2 cents 16.7 1.72 17% Hypothetical untiered rate** 25 cents 18 cents 10 cents 2.5 50% *relative to an estimated 20 cent average non-CARE residential rate **This hypothetical rate is intended to illustrate the type of rate that could provide adequate incentive to increase consumption in super-off-peak periods. While SCE’s Tier 1 rates seem attractive, a majority of customers consume more than baseline quantities in some months, and therefore pay Tier 2 rates during those months. We find that SCE’s Tier 2 spring weekday super-off-peak rates (16.7 cents per kWh) are too high to provide adequate incentive to increase consumption in super-off-peak periods. Furthermore, offering a 50% discount relative to the average residential rate as illustrated in Table 1 would be unlikely to violate the rate floor consisting of the sum of nonbypassable costs (NBCs) and marginal costs. By this Resolution, we therefore order SCE to file a supplemental advice letter proposing an optional TOU rate that is revenue neutral to its Rate 3 proposal, has the same TOU periods and seasons as the proposed Rate 3, but does not contain a baseline credit. For non-CARE customers, the untiered Rate 3 proposal must have a super-off-peak rate that is at least 50% below the seasonal average residential rate. For CARE customers, the untiered Rate 3 proposal must have a super-off-peak rate that is at least 50% below the seasonal average CARE residential rate. Both non-CARE and CARE versions of the untiered Rate 3 must have a ratio of seasonal peak to super-off-peak rate of at least 2.5. While this approach would distinguish SCE’s Rate 3 from the other IOUs’ TOU pilot rates and the control group, we believe that there is sufficient comparability to obtain reliable and useful results about the differential load and billing impacts across each service territory with and without a baseline credit. Essentially, the comparison of SCE’s Rate 3 group to the control group would test
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