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P.O. Box 800 2244 Walnut Grove Ave. Rosemead, California 91770 (626) 302-3630 Fax (626) 302-4829

Akbar Jazayeri Vice President of Regulatory Operations

November 23, 2011

ADVICE 2659-E (U 338-E)

PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA ENERGY DIVISION

SUBJECT: Southern California Edison Company’s Informational Advice Letter Compliance Filing on Statewide Marketing, Education and Outreach (ME&O)

In compliance with the October 13, 2011 Assigned Commissioner’s Ruling (ACR) Regarding the Statewide Marketing and Outreach Program, Southern California Edison Company (SCE) hereby submits for filing this Advice Letter demonstrating a stop work order has been issued to Draftfcb and its subcontractors. All necessary supporting documentation is attached hereto.

PURPOSE

The purpose of this Advice Letter is to provide the information required by the California Public Utilities Commission (CPUC or Commission) in the aforementioned ACR.

BACKGROUND

The historic Statewide ME&O program, previously known as Flex Your Power, originated from an effort to respond to the energy shortages from the California Energy Crisis in 2001. In 2009, stakeholders aligned the statewide ME&O program with California Energy Efficiency Strategic Plan (CEESP), which resulted in the development of the web portal (www.engage360.com) and the Integrated Marketing and Communications (IMC) plan. As cited in Decision (D.) 09-09-047, the Commission had “engaged in a thorough review of the [Statewide ME&O] program” during this time and required the investor-owned utilities (IOUs) to work under the direction and guidance of the Commission staff to implement the Statewide ME&O program. Activities to be conducted during this program cycle included: “brand assessment/creation, audience segmentation, integrated communication planning, web portal development, and the

ADVICE 2659-E (U 338-E) - 2 - November 23, 2011

Statewide ME&O program implementation for 2010-2012.”1 With SCE as the lead, the IOUs have implemented this program in close collaboration with the Energy Division.

In June, the IOUs approached Energy Division with a presentation on an alternative option in lieu of using “Engage 360” as the primary name on the Statewide ME&O campaign. The IOUs identified in this discussion that consumers did not intuitively identify the name Engage 360 as being related to energy. The IOUs recommended creating a new identity that clearly communicated what Engage 360 is about, while still complying with existing Commission directives.

Commissioner Ferron spoke with the Statewide ME&O taskforce on September 26, and directed that expenditures related to Engage 360 be brought immediately to zero, or as near thereto as possible. This direction was also mentioned by Commissioner Ferron at the October 6 Commission meeting. Commissioner Ferron then issued an ACR on October 13, directing the IOUs to take the following steps:

1) SCE shall immediately issue a stop work order to Draftfcb (the Engage 360 contractor) and its subcontractors (Draft) directing Draft to stop all spending associated with Engage 360 and the statewide ME&O, so that expenditures by Draft and its subcontractors borne by utility ratepayers are at zero. I understand that SCE has already done so orally and that Draft and its subcontractor expenses are already zeroed out, but SCE shall issue the written stop work order nonetheless.

2) SCE shall make an informational Advice Letter compliance filing demonstrating that it has given such notice.

3) SCE shall stop all of its own work associated with Engage 360 as well, except as necessary to assist Commission staff in its investigation of next steps for the program, and redirect personnel to other tasks pending direction from this Commission on next steps.

4) To the extent any expense is not at zero, SCE shall file, on its own behalf or with regard to SCE, Draft, or any subcontractors, with the foregoing informational Advice Letter filing, an explanation of that expenditure.

While encompassed in the foregoing directive, I wish to make clear that all work on the Engage 360 website/web portal shall cease. The site may be "frozen" as is, but no additional upgrades or maintenance shall take place pending further notice.”

1 D.09-09-047, p. 241.


SCE submits the following information herein:

• Attachment A to this Advice Letter includes the Notice to Stop Work letter sent to Draftfcb.

• Attachment B to this Advice Letter includes the Notice to Stop Work letter sent to Ascentium.

• Attachment C to this Advice Letter includes an itemized list of expenditures not at zero.

PROPOSAL

1. Issuance of Notice to Stop Work

Immediately following Commissioner Ferron’s direction on September 26, SCE telephoned Draftfcb and verbally instructed it to stop all work and bring spending to zero. SCE then confirmed this direction to Draftfcb in an email on September 27. Following the issuance of the ACR, on October 18, SCE issued a formal Notice to Stop Work pursuant to Section 6.3 of the Terms and Conditions in SCE’s Purchase Order #4500277102 to Draftfcb.

A formal Notice to Stop Work was also mailed to Ascentium, the Engage 360 web portal implementer, pursuant to Section 6.3 of the Terms and Conditions in SCE’s Purchase Orders #4500126483 and #4500436505.

The web portal was immediately “frozen” in accordance with the ACR which stated that “no additional upgrades or maintenance shall take place.” However, since then, SCE has instructed Ascentium to safeguard the web portal as the consequences of no maintenance could be detrimental to consumers and the reputation of the IOUs and CPUC. These safeguards are necessary to prevent unauthorized use of the site or worse, and to protect against hacker attacks on the site. Hacker attacks could lead to defacing of the site, the posting of unauthorized or offensive material, and infecting users with malware and the possible compromise of confidential information.

2. Suspension of SCE Work

As the lead utility for Statewide ME&O, SCE had dedicated a staff of four full-time employees to the effort: one manager, two project managers, and one financial analyst.

As of November 1, the manager’s labor allocation to the Statewide ME&O has been reduced by 50 percent as necessary to assist the Commission staff in determining next steps for the program (the remaining 50 percent has been redirected outside the scope of the program) and the two project managers were reassigned to other projects. The manager will continue work in this capacity until further direction on this program is provided by the Commissioner. The financial analyst will continue to work with the program until year-end or further as directed by the Commissioner. This is necessary in


order to close all billing invoices with Draftfcb and Ascentium. The financial analyst will also continue to coordinate the IOU co-funding agreements and invoices.

3. Explanation of Non-zero Expenditures

In compliance with the Commissioner’s directive, Statewide ME&O expenditures were brought to zero to the degree possible upon receipt of the ACR on October 13.

Recognizing that there are some expenses associated with ramping down and closing the program, an itemized list is attached for reference (Attachment C). Please note that the majority of these expenses were claimed by Draftfcb as the primary vendor, and represent claimed amounts only. SCE does not agree with the amounts, and thus figures presented in Appendix C part b are subject to resolution. Furthermore, item g in section 4, below, is included in Attachment C, part (a), as an additional expenditure.

4. Additional Proposals

Below SCE presents a set of recommendations related to other aspects of the program that do not fall within this proceeding but would like the Commission to be aware of.

a. Energy Savings Assistance Program D.09-10-012 directs the Statewide Energy Savings Assistance Program to co-brand with the Statewide ME&O brand, Engage 360. In accordance with the Commissioner’s direction, the 2011 Statewide Energy Savings Assistance Program campaign will remove the Engage 360 logo from Energy Savings Assistance Program statewide marketing materials including bus/rail interiors and transit shelters in geo-targeted locations. This material was previously planned to point customers to the Engage 360 website (http://www.engage360.com). However, in light of this direction, SCE seeks to direct consumers to a new URL specific to this program (such as http://www.energysavingassistanceprogram.com), which can redirect to the CPUC webpage for the Energy Savings Assistance Program (http://www.cpuc.ca.gov/PUC/energy/Low+Income/liee.htm).

b. Demand Response Education SCE recommends Demand Response Education activities continue to be prepared for launch in anticipation of the warmer temperatures in spring and summer seasons. If deemed appropriate by the Commission, Draftfcb should be permitted to work on planning strategies and concepts during Q4 2011.

c. Statewide Emergency Alert System As the IOUs are adopting and rolling out new demand response/time-of-use programs/rates, it is logical to re-evaluate the benefit of a statewide demand response emergency alert system. It is SCE’s position that an emergency alert system is unnecessary and will result in consumer confusion.


d. Web Portal Rebate Finder SCE requests that the Commission allow the continued support of the Rebate Finder tool by the Engage 360 web portal. There are currently 109 organizations managing their own rebates and incentives through the administration forms. This request would include sharing of the rebate finder database with EnergyUpgradeCA.org and CoolCalifornia.org and resolving any data transfer issues or critical issues that prevent the rebate information from being accurately displayed. This request would exclude the addition of new organizations, introducing new functionality, resolving individual user account issues and questions.

e. Ascentium Contract Expiration/Extension SCE requests that the Commission allow the extension of the Ascentium’s contract (which is set to expire on December 31, 2011) through February 28, 2012. This will allow sufficient time to determine the best course of action based on the Commission’s review and direction.

f. Web Portal User Registration SCE requests that the Commission allow the registration of users on the http://www.engage360.com website, since this is a passive action that is built into the website. Additionally, while the Commission determines the best possible course for this program, SCE recommends continuing to allow registered users to post information to the website. There are currently over 1,000 registered users, and in some cases there are members of statewide programs that have identified the statewide EE web portal as a communication tool for their program. Examples of such programs include the Statewide Lighting Market Transformation program, the Local Government Partnerships, and the Statewide Workforce, Education & Training program.

g. Web Portal Maintenance SCE has notified the Energy Division of ongoing issues surrounding the basic security concerns for a statewide website linked to ratepayer funding and the Commission. The vendor has been authorized to perform basic upkeep to the site to identify, prevent, and resolve any security issues. Additionally, the same vendor has been requested to perform work necessary to identify and remove inappropriate content and ban users that violate the Engage 360 Terms of Use.

h. Reporting of Program Performance Metrics SCE requests that a future ACR, Resolution, or Decision related to this program include direction related to the reporting of ME&O Program Performance Metrics (PPMs) pursuant to Resolution E-4385. Additionally, Market Transformation Indicators (MTIs) could potentially be adopted prior to the approval of this Advice Letter, and should also be addressed for this program in future Commission direction.


i. Additional Requests SCE hereby notifies the Commission that it will work with Energy Division directly and notify the Assigned Commissioner of any additional items related to the suspension of the Engage 360 brand. Promotional items (e.g., cold-water laundry detergent with the Engage 360 logo) are currently in storage and in many cases may need to be addressed prior to the approval of this Advice Letter. SCE will make every effort to inform and seek input in such instances.

No cost information is required for this advice filing.

This advice filing will not increase any rate or charge, cause the withdrawal of service, or conflict with any other schedule or rule.

TIER DESIGNATION

Pursuant to General Order (GO) 96-B, Energy Industry Rule 5.3, this Advice Letter is submitted with a Tier 3 designation.

EFFECTIVE DATE

This advice filing will become effective upon Commission approval.

NOTICE

Anyone wishing to protest this advice filing may do so by letter via U.S. Mail, facsimile, or electronically, any of which must be received no later than 20 days after the date of this advice filing. Protests should be mailed to:

CPUC, Energy Division Attention: Tariff Unit 505 Van Ness Avenue San Francisco, California 94102 E-mail: [email protected] and [email protected]

Copies should also be mailed to the attention of the Director, Energy Division, Room 4004 (same address above).

In addition, protests and all other correspondence regarding this advice letter should also be sent by letter and transmitted via facsimile or electronically to the attention of:

Akbar Jazayeri Vice President of Regulatory Operations Southern California Edison Company 2244 Walnut Grove Avenue Rosemead, California 91770 Facsimile: (626) 302-4829 E-mail: [email protected]


Leslie E. Starck Senior Vice President c/o Karyn Gansecki Southern California Edison Company 601 Van Ness Avenue, Suite 2030 San Francisco, California 94102 Facsimile: (415) 929-5540 E-mail: [email protected]

There are no restrictions on who may file a protest, but the protest shall set forth specifically the grounds upon which it is based and shall be submitted expeditiously.

In accordance with Section 4 of GO 96-B, SCE is serving copies of this advice filing to the interested parties shown on the attached GO 96-B and R.09-11-014 service lists. Address change requests to the GO 96-B service list should be directed by electronic mail to [email protected] or at (626) 302-2930. For changes to all other service lists, please contact the Commission’s Process Office at (415) 703-2021 or by electronic mail at [email protected].

Further, in accordance with Public Utilities Code Section 491, notice to the public is hereby given by filing and keeping the advice filing at SCE’s corporate headquarters. To view other SCE advice letters filed with the Commission, log on to SCE’s web site at http://www.sce.com/AboutSCE/Regulatory/adviceletters.

For questions, please contact Laura Kimes at (626) 302-0689 or by electronic mail at [email protected].

Southern California Edison Company

Akbar Jazayeri

AJ:lk:sq Enclosures

Attachment A

Notice to Stop Work Letter Sent to DraftFCB

Attachment B

Notice to Stop Work Letter Sent to Ascentium

Attachment C

Itemized List of Expenditures Not at Zero

C-1

Attachment C - Part (a) Expenditures Not at Zero – Ascentium and SCE DESCRIPTION October November December Total Ascentium Site Maintenance $ 2,250 $ 3,150 $ 3,150 $ 8,550 Site Hosting $ 4,500 $ 4,500 $ 4,500 $ 13,500 SCE Labor $ 16,000 $ 10,300 $ 10,300 $ 36,600 TOTAL $ 58,650

C-2

Attachment C - Part (b) DraftFCB Expenditures Not at Zero (Amounts are those claimed by DraftFCB – SCE does not agree with these amounts. All amounts are subject to resolution among the contractual parties.)

SCE STOP WORK ORDER 10.13.2011

DRAFTFCB WORK STOP COSTS

Finance HrsContract

Rate Monthly Avg Sept Oct Nov Dec TOTALSUBTOTAL $21,785 $5,446 $21,785 $21,785 $21,785 $70,801

Narratives HrsContract

Rate Sept/Q3 Sept Oct Nov Dec TOTALSUBTOTAL $6,948 $0 $6,948 $0 $0 $6,948

Community Outreach Sunk Costs (non-cancelable costs through December 2012) TOTALSUBTOTAL(administrative travel and hours to set up offices are not reflected) $114,187

Community Outreach Staff Time from Stop Work through Term

HrsContract

Rate Sept/Oct Idle TOTALSUBTOTAL $225,394 $90,440 $315,834

Other DFCB Staff Time from Stop Work to Redeploy

Title HrsContract

Rate Sept/Oct Idle TOTALSUBTOTAL $57,327 $57,327

TOTAL $565,097

+Severance Period (2wks)

NOTE: All discussions on effective dates of hourly rate changes and contract change orders for previously completed work are not reflected in this document and are being addressed separately.

CALIFORNIA PUBLIC UTILITIES COMMISSION

ADVICE LETTER FILING SUMMARY ENERGY UTILITY

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

Company name/CPUC Utility No.: Southern California Edison Company (U 338-E)

Utility type: Contact Person: James Yee

ELC GAS Phone #: (626) 302-2509

PLC HEAT WATER E-mail: [email protected]

E-mail Disposition Notice to: [email protected]

EXPLANATION OF UTILITY TYPE

ELC = Electric GAS = Gas PLC = Pipeline HEAT = Heat WATER = Water

(Date Filed/ Received Stamp by CPUC)

Advice Letter (AL) #: 2659-E Tier Designation: 3

Subject of AL: Southern California Edison Company’s Informational Advice Letter Compliance Filing on Statewide Marketing, Education and Outreach (ME&O)

Keywords (choose from CPUC listing): Compliance

AL filing type: Monthly Quarterly Annual One-Time Other

If AL filed 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 AL1:

Confidential treatment requested? Yes No

If 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: upon Commission approval

No. of tariff sheets: -0-

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: None

Service affected and changes proposed1:

Pending advice letters that revise the same tariff sheets:

1 Discuss in AL if more space is needed.

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

CPUC, Energy Division Attention: Tariff Unit 505 Van Ness Ave., San Francisco, CA 94102 [email protected] and [email protected]

Akbar Jazayeri Vice President of Regulatory Operations Southern California Edison Company 2244 Walnut Grove Avenue Rosemead, California 91770 Facsimile: (626) 302-4829 E-mail: [email protected] Leslie E. Starck Senior Vice President c/o Karyn Gansecki Southern California Edison Company 601 Van Ness Avenue, Suite 2030 San Francisco, California 94102 Facsimile: (415) 929-5540 E-mail: [email protected]

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