California regulators reiterated on Thursday their strong reliance on energy efficiency programs and the need to provide utility shareholder incentives to expand the efforts. In doing so they ignored calls from consumer advocates to end the rewards to shareholders.

While the California Public Utilities Commission (CPUC) approved continued funding for utility efficiency programs and handed out $60 million in incentive rewards, the CPUC’s independent Division of Ratepayer Advocates (DRA) renewed its call for eliminating what it alleges is a costly and ineffective program of bonuses to private-sector utility shareholders.

The bonuses granted Thursday were for 2009 program results by Pacific Gas and Electric Co. $26.2 million, Southern California Edison Co. $18.1 million, and Sempra Energy’s two utilities, San Diego Gas and Electric Co. $13.7 million and Southern California Gas Co. $2 million. Combined they had asked for $77 million in rewards for the 2009 program efforts.

“The $60 million in bonuses approved are in addition to $68 million awarded in 2010 for a total of $212 million awarded for the 2006-2008 programs, even though none of the bonus amounts awarded met the CPUC-established goals for energy savings,” said a DRA spokesperson.

Four years ago, the CPUC established a “risk-reward incentive mechanism” to encourage utilities to invest in efficiency and help defer the need for new generating capacity.

The DRA argues that the utilities are not meeting their goals, but the rewards are still being distributed anyway. The consumer unit said the latest bonuses awarded were based on the utilities’ self-reported claims, discounted for overstatement of savings from lighting programs. Last year the CPUC itself reportedly found what DRA called “large discrepancies” between utility reported energy savings and independently evaluated savings.

Nevertheless, the CPUC Thursday unanimously agreed to continue to fund efficiency, research/development/demonstration (RD&D), and renewable energy programs through the end of next year.

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