STATE OF CALIFORNIA EDMUND G. BROWN JR., Governor

PUBLIC UTILITIES COMMISSION 505 VAN NESS AVENUE

SAN FRANCISCO, CA 94102-3298

May 24, 2018

Advice Letter 5279-E

Erik Jacobson

Director, Regulatory Relations

Pacific Gas and Electric Company

77 Beale Street, Mail Code B10C

P.O. Box 770000

San Francisco, CA 94177

SUBJECT: Details of PG&E's SB350 Transportation Electrification Idle Reduction

Technology Priority Review Project.

Dear Mr. Jacobson:

Advice Letter 5279-E is effective as of May 27, 2018.

Sincerely,

Edward Randolph

Director, Energy Division

Erik Jacobson Director Regulatory Relations

Pacific Gas and Electric Company 77 Beale St., Mail Code B13U P.O. Box 770000 San Francisco, CA 94177 Fax: 415-973-3582

April 27, 2018

Advice 5279-E (Pacific Gas and Electric Company ID U 39 E)

Public Utilities Commission of the State of California

Subject: Details of PG&E’s SB350 Transportation Electrification Idle

Reduction Technology Priority Review Project

Purpose As provided in Ordering Paragraph (OP) 28 of Decision (D.)18-01-024, Pacific Gas and Electric Company (PG&E) hereby submits this Tier 2 advice letter to provide additional details regarding its Idle Reduction Technology Priority Review Project. Specifically, OP 28 requests that PG&E identify:

(1) commitments from both truck stops and fleet operators; (2) PG&E’s efforts to engage and educate these partners throughout the

duration of the pilot; (3) how PG&E will design this pilot to collect the necessary data to inform future

rate designs that can make these idle reduction technologies economically feasible; and

(4) whether PG&E plans to support truck stop electrification, transport refrigeration units, or both.

Ordering Paragraph 28 also directs PG&E to “present its Idle Reduction Technology Project before the California Freight Advisory Committee and report any feedback as part of its Tier 2 Advice Letter.”

Background On January 11, 2018, the California Public Utilities Commission (Commission or CPUC) issued D.18-01-024 approving, with modifications, 15 of the Priority Review Projects proposed by California’s three largest investor owned electric utilities for a total budget of approximately $41 million. PG&E’s Idle Reduction Technology project was approved with a budget of $1.72 million contingent upon the provision of further information about the economic viability of the technology and identification of partners. Moreover, the

Advice 5279-E - 2 - April 27, 2018 CPUC noted in D.18-01-024 that it felt PG&E had not adequately “…identified[sic] what barriers are currently limiting the adoption of these technologies, or explain how its proposal would address those barriers.” In this Advice Letter, PG&E will address market barriers and provide additional details as requested by the CPUC. Deployment of any idle reduction technology will not begin until approval by the Commission of this Tier 2 Advice Letter.

Commitments from Truck Stops and Fleet Operators PG&E has spoken with several grocery chains, food manufacturers, food service/distribution companies, and truck stop owners; nearly all of them expressed interest in participating in the pilot. PG&E intends to implement the pilot at one to two facilities, subject to securing of signed contracts with the customer counterparties, detailed design estimates, and the project budget. The currently-identified facilities include a dairy manufacturer‘s distribution warehouse (Customer 1) and the distribution center for a large grocery chain (Customer 2), both of which are located in disadvantaged communities in the San Joaquin Valley. Upon approval of this Advice Letter, PG&E will finalize contract terms with the customer(s) and perform detailed design to assess the costs/budget for these sites. If funds remain, PG&E may plan an additional pilot site. PG&E is currently in conversations with Customer 1 who manufactures and distributes dairy products. Customer 1 has between 15-30 refrigerated trailers idling for various hours of the day, typically no longer than 12 hours. Approximately 40% of the customer’s current fleet are Electric Transport Refrigeration Units (eTRUs), with more units being purchased each year as the non-eTRU fleets turnover. While the customer’s fleet is currently capable of using electricity for pre-cooling and maintaining the temperature of the cargo, the customer has not used this feature as there are no electrified spaces at the facility; the customer instead uses diesel to power the TRUs. The key barrier to adoption for the customer has been identified as the lack of electric infrastructure, hence PG&E intends to install make-ready infrastructure to support between 15-25 electrified parking spaces at its facility, pending approval of the Tier 2 Advice Letter, agreement on contract terms, and detailed design. PG&E is also working with the customer to identify which charging pedestals will meet the customer’s needs, and may provide a rebate/incentive for such chargers. PG&E is also in conversations with Customer 2, a large grocery chain with a distribution center in the San Joaquin Valley. Customer 2 currently has over 200 eTRUs and expects to convert its entire fleet to eTRUs over the next 15 years. The customer estimates a future need for possibly 500 electrified parking spaces. Average idling times for the refrigerated trailers range between 4 to 10 hours, with some instances of idling over 12 hours while the trailers wait for dispatch. Similar to Customer 1, Customer 2 does not have enough infrastructure to plug in its eTRU fleet. PG&E intends to utilize

Advice 5279-E - 3 - April 27, 2018 the pilot to install at least 15 electrified parking spaces at the distribution center, with the final number subject to signing of a customer contract, detailed design, and what is feasible within the pilot budget.

Efforts to Educate and Engage Project Partners PG&E has already had initial conversations with the customers identified above to collect more information on their fleets, charging needs, and barriers to adoption. Upon approval of this Advice Letter, PG&E will create a detailed project scope, assess the opportunity for complementary tools such as energy storage or energy management software, and begin detailed design of each site. PG&E will work with each customer to identify optimized electric plug-in behavior and rate schedules, and to finalize the data collection necessary to assess total cost of ownership for the fleet. PG&E will communicate regularly with each customer on progress of the design and construction of the facilities, and will work with each customer to design a change management plan for their operations, if necessary.

Plan to Collect Data to Inform Future Rate Design Cost and the lack of understanding on the benefits of using electric fuel vs. diesel fuel have been identified as key barriers for fleet owners in the adoption of eTRUs (see discussion starting on page 5). As a result, PG&E’s pilots will focus on understanding total cost of ownership for an electrified trailer fleet, as opposed to a traditional fossil-fuel fleet. See Table 1 below for a sample of data that PG&E intends to collect. PG&E intends to collect operational data at least quarterly and will monitor utilization of the charging equipment once installed and operational. PG&E intends to meet at least semi-annually with each customer to review charging behavior, utilization, and electricity charges. In this way, PG&E will be able to assess total cost of ownership for the fleet and determine what rate changes, if any, may further reduce total cost of ownership given the fleet’s charging behavior. TABLE 1: EXAMPLE DATA EXPECTED TO BE COLLECTED FOR PG&E’S IDLE REDUCTION

PILOTS

Line No Category Metric

1 Deployment Site description Vehicle/eTRU type and number EVSEs installed (including power rating, make and model) Deployment time Installation cost (total and average) of chargers Installation cost for make-ready infrastructure Deployment within or adjacent to Disadvantaged Communities

2 Operational Utilization rate by site, by type of charger Applicable rate kW profile

Advice 5279-E - 4 - April 27, 2018

kWh usage by price Load management approaches, where applicable Other usage data: plugged in time, charging duration, charging power level Charging load profiles (aggregate and by charger) Load impacts Cost of alternate fuels for traditional fleet Customer experience and satisfaction

3 Descriptive Key barriers to deployment of EV charging infrastructure and the Program’s approaches to overcome these barriers Change management approaches/ key operational process considerations Insights on effect of the program on the EVSE and EV market

PG&E expects to propose new electric vehicle commercial rates in 2018. Upon approval of such rates, PG&E will model each customer’s load and switch each customer to the new rate plans, if beneficial. In addition, PG&E intends to survey each customer to understand their experience in switching eTRUs to electric standby from diesel standby. These surveys will enable PG&E to be able to provide valuable lessons learned from the perspective of the customer, for the benefit of other customers interested in adopting eTRUs. The pilot will also provide PG&E with more granular data on costs to serve unique Transportation Electrification loads, including eTRUs, which will help inform how future EV rate designs allocate costs.

PG&E’s Plan to Support Truck Stop Electrification, Transport Refrigeration Units,

or Both For its idle reduction technology pilot, PG&E intends to support only short-haul eTRU fleets at distribution warehouses/facilities. By siting infrastructure at a privately-owned distribution warehouse/facility, fleet owners will have the ability and incentive to ensure full utilization of the plug-in infrastructure. PG&E will also be able fully assess the economic benefits for eTRU adopters, as these private fleet owners will be able to make a direct comparison between their electric fueling costs vs diesel fueling costs. While the focus of the Idle Reduction Technology Priority Review Project will be eTRUs, PG&E recognizes that there is still a larger need for electrification of truck stops across its service territory and the FleetReady program will accommodate truck stop electrification (TSE). TSE can address two idle reduction opportunities. First, electric charging infrastructure installed at truck stops can support long-haul eTRU fleets and can be used to maintain temperature within the refrigerated trailer without the use of an internal combustion engine (ICE). Second, idle reduction technology (single system/off-board or dual system/on-board) can be used not only for eTRU fleets but also for other long-haul trucking operations to heat and cool the truck cabin, charge batteries, or power other appliances in a sleeper cab without the need to use an ICE.

Advice 5279-E - 5 - April 27, 2018 California houses 87 truck stops which meet the definition of the National Association of Truck Stop Operators (NATSO). These truck stops represent 10,406 truck parking spaces. PG&E’s service territory houses 25 of these truck stops representing 3,699 parking spaces, of which only 5 truck stops currently offer 149 electrified parking spaces and infrastructure to support eTRUs.1 By installing electric plug infrastructure at truck stops, PG&E could eliminate 33% of an individual long-haul truck’s typical idling time. Adding rest stops would reduce idling another 21%.2 It is clear that more infrastructure will be needed to support long-haul fleets in the future, and PG&E believes that electric infrastructure will be needed at truck stops to address barriers to adoption of eTRUs and further reduce air pollutants caused by diesel engine idling.

Description of Market and Market Barriers The CPUC noted in D.18-01-024 that it felt PG&E had not adequately “…identified[sic] what barriers are currently limiting the adoption of these technologies, or explain how its proposal would address those barriers.” The following section discusses market barriers for the adoption of TSE and eTRUs and how PG&E’s pilots are intended to address such market barriers. PG&E’s idle reduction technology pilot will focus on reducing idling and the resultant emissions from Transport Refrigeration Units (TRUs) which are mobile refrigeration systems powered by integral internal combustion engines designed to control the environment of temperature sensitive products that are transported in trucks and refrigerated trailers.3 While technology now exists in the form of Electric Transport Refrigeration Units (eTRUs) that are capable of shutting down the integral ICE and instead using an electric motor for temperature control when stationary and plugged in at electrified parking spaces, the technology has not been widely adopted in the U.S., nor has the practice of plugging in fleets with electric capabilities. This has negative impacts on public health, particularly in disadvantaged areas where TRUs often congregate at distribution centers/warehouses and truck stops.4,5

1 Alternative Fuels Data Center, “U.S. Truck Stop Electrification Locations.” [Online] Available: https://www.afdc.energy.gov/truckstop. [Accessed 14 March 2018]. 2 M.A. Tunnel and V. Deck, “Idle reduction technology: Fleet preferences survey,” NYSERDA, Albany, NY, 2006. Available: http://www.atri-online.org/research/results/Idle%20Reduction%20Technology%20Fleet%20Preferences%20Survey.pdf 3 “Technology Assessment: Transport Refrigerators.” California Air Resources Board, August 2015, pg ES-1. 4 https://www.lewis.ucla.edu/wp-content/uploads/sites/2/2016/09/2015-2016_CommunityScholars_DeliveringtheGood_FinalReport.pdf 5 “California Freight Mobility Plan”, Chapter 3.4 Community & Environmental Context, page 200, California State Transportation Agency, December 2014.

Advice 5279-E - 6 - April 27, 2018 Demand for fresher foods and temperature control transportation is a growing trend, with the frozen food sector estimated to grow between 0.5% and 4.5% annually.6 At the same time, national standards for the safe transportation of food have increased with the US Food and Drug Administration (FDA)’s 2016 release of its Food Safety Modernization Act rule on Sanitary Transportation of Human and Animal Food which imposed more stringent measures on fleet owners to ensure that temperatures throughout the supply chain are maintained per the requirements.7 Moreover, fleet owners in California are under increased regulations imposed by the California Air Resources Board (CARB) for idling and emissions reductions. These include regulations expected in 2018 that phase in strict time limits on idling at distribution centers, terminals, food manufacturing plants, cold storage facilities, and anywhere else TRUs congregate in California.8 All of these restrictions drive higher equipment and operating costs for TRU fleet owners who are typically trucking companies, grocery stores, food manufacturers, and food service/distribution providers operating in competitive industries with thin profit margins. According to Jeff Cohen, a grocery industry analyst with IBIS World, the average profit margin for grocery stores is 1.3%, and data collected by Professor Aswath Damordan at the NYU Stern School of Business indicate the average margin for the trucking industry is 2.0%.9, 10 PG&E’s discussions with potential customers indicate that a small number of fleet owners in PG&E’s service territory are slowly beginning to adopt eTRU technology as their traditional TRU fleets reach end of life; however, customers lack the electrified power plugs/parking spaces to fully utilize this technology, thereby rendering the benefits null. Several customers indicated that they have eTRUs that idle for an average of 5 hours a day while pre-cooling, being loaded, and waiting for dispatch once full. At any time there can be between 15-50 eTRUs idling at a small to medium-sized customer’s facility. One large grocery chain with whom PG&E spoke indicated it may need 500+ electrified parking spaces to support its refrigerated distribution fleet. A study by the Electric Power Research Institute (EPRI) in 2015 found multiple barriers to widespread adoption of eTRUs.11 See Table 2 below for a full listing of these barriers

6 “Workshop #2: Reducing Residual Risk from Transport Refrigeration Units by Transitioning to Zero-Emission Technologies”, California Air Resources Board, Aug 8 , 2017. [accessible at https://www.arb.ca.gov/cc/cold-storage/documents/tru_workshop2_slides.pdf] 7 Galligan, Jim. Transport Topics. “Food Standards, Emission Regulations Affect Load Flexibility for Refrigerated Fleets”. August 25, 2017 (http://www.ttnews.com/articles/food-standards-emission-regulations-affect-load-flexibility-refrigerated-fleets) 8 “Transport Refrigeration Residual Risk Reduction Airborne Toxic Control Measure (TR4 ATCM)”, California Air Resources Board, https://www.arb.ca.gov/cc/cold-storage/cold-storage.htm [accessed 4/4/2018]. 9 https://www.marketplace.org/2013/09/12/business/groceries-low-margin-business-still-highly-desirable 10 http://people.stern.nyu.edu/adamodar/New_Home_Page/data.html [accessed 3/19/2018] 11 “Market and Technology Assessment of Electric Transport Refrigeration Units,” Electric Power Research Institute, December 2015

Advice 5279-E - 7 - April 27, 2018 and whether they apply to both warehouses and truck stops. Moreover, several of these barriers were also identified by CARB in its 2015 Technology Assessment for Transport Refrigerators. Specifically, CARB found that “limited fueling infrastructure exists, and fueling infrastructure costs are significant”.12 TABLE 2: BARRIERS FOR ADOPTION OF ETRU TECHNOLOGY

Given the thin profit margins of eTRU fleet owners and the high cost of capital to install electric infrastructure, it is unsurprising that lack of infrastructure has been a key barrier to adoption in this space. CARB has noted that “incentive programs are needed to reduce economic barriers and accelerate deployment. Encouraging necessary

12 “Technology Assessment: Transport Refrigerators.” California Air Resources Board, August 2015, page ES-9

Advice 5279-E - 8 - April 27, 2018 energy/fueling infrastructure development with funding and incentive programs would address one of the key barriers to deployment.”13 However, “few grant programs allow electric infrastructure as an eligible project type”.14 PG&E agrees with these findings. Highlighted in Table 3 are barriers that PG&E intends to address initially through its idle reduction technology pilot and eventually through its FleetReady program. TABLE 3: BARRIERS TO BE ADDRESSED BY PG&E

13 “Technology Assessment: Transport Refrigerators.” California Air Resources Board, August 2015, pg ES-12 14 “Market and Technology Assessment of Electric Transport Refrigeration Units,” Electric Power Research Institute, December 2015, pg 4-4

Advice 5279-E - 9 - April 27, 2018 PG&E’s idle reduction pilot will aid fleet owners who may not have the resources to invest in significant infrastructure required to power their eTRU fleets when not in transit. The pilot will study the Total Cost of Ownership for eTRUs and what tools may help lower overall Total Cost of Ownership for these fleets. For example, conversations with CARB and eTRU retailers indicate that eTRUs can draw anywhere between 4 kW and 18 kW when plugged in. High variability in plug loads for a fleet of units may make eTRU sites good candidates for energy management software or energy storage in order to mitigate demand charges. PG&E will use the pilot’s resultant data to provide the market and other PG&E fleet owner customers with data and educational materials that demonstrate the economic and health benefits of using standby electric power for eTRUs over those of idling diesel engines. Research has shown that “fleets [are] often not aware of the capability to plug into grid power using hybrid electric TRUs. Many industry interviews have revealed that drivers or fleet managers often do not fully understand the difference between a hybrid electric TRU running on diesel vs. a grid-connected hybrid electric TRU running on electricity.”15 As a result, it will be critical to produce educational materials that can be used in broader outreach for the PG&E FleetReady program. PG&E has already budgeted approximately $50,000 within its idle reduction project to produce such materials for ongoing education and outreach within this space.

Feedback from the California Freight Advisory Committee As directed by the CPUC, PG&E distributed its project implementation plan for the Idle Reduction Technology pilot to the members of the California Freight Advisory Committee (CFAC) for review (see Appendix A) on April 5, 2018. Members were asked to provide feedback no later than April 16, 2018 to CFAC@dot.ca.gov. The Caltrans team coordinating CFAC confirmed on April 19, 2018 that no feedback was received.

Protests Anyone wishing to protest this filing may do so by letter sent via U.S. mail, facsimile or E-mail, no later than May 17, 2018, which is 20 days after the date of this filing. Protests must be submitted to:

CPUC Energy Division ED Tariff Unit 505 Van Ness Avenue, 4th Floor San Francisco, California 94102

15 “Pacific Gas and Electric Company (PG&E) Electrification Case Study Report, Electric Power Research Institute, March 2017.

Advice 5279-E - 10 - April 27, 2018

Facsimile: (415) 703-2200 E-mail: EDTariffUnit@cpuc.ca.gov

Copies of protests also should be mailed to the attention of the Director, Energy Division, Room 4004, at the address shown above. The protest shall also be sent to the SGIP PAs either via E-mail or U.S. mail (and by facsimile, if possible) at the address shown below on the same date it is mailed or delivered to the Commission:

Erik Jacobson Director, Regulatory Relations c/o Megan Lawson Pacific Gas and Electric Company 77 Beale Street, Mail Code B13U P.O. Box 770000 San Francisco, California 94177 Facsimile: (415) 973-3582 E-mail: PGETariffs@pge.com

Any person (including individuals, groups, or organizations) may protest or respond to an advice letter (General Order 96-B, Section 7.4). The protest shall contain the following information: specification of the advice letter protested; grounds for the protest; supporting factual information or legal argument; name, telephone number, postal address, and (where appropriate) e-mail address of the protestant; and statement that the protest was sent to the utility no later than the day on which the protest was submitted to the reviewing Industry Division (General Order 96-B, Section 3.11).

Effective Date PG&E requests that this Tier 2 advice filing become effective on regular notice, May 27, 2018 which is 30 calendar days after the date of filing. Notice In accordance with General Order 96-B, Section IV, a copy of this advice letter is being sent electronically and via U.S. mail to parties shown on the attached list and the parties on the service list for A.17-01-020, A.17-01-021, A.17-01-022. Address changes to the General Order 96-B service list should be directed to PG&E at email address PGETariffs@pge.com. For changes to any other service list, please contact the Commission’s Process Office at (415) 703-2021 or at Process_Office@cpuc.ca.gov.

Advice 5279-E - 11 - April 27, 2018 Send all electronic approvals to PGETariffs@pge.com. Advice letter filings can also be accessed electronically at: http://www.pge.com/tariffs/. /S/ Erik Jacobson Director, Regulatory Relations Attachment cc: Service List A.17-01-020, A.17-01-021, A.17-01-022

CALIFORNIA PUBLIC UTILITIES COMMISSION ADVICE LETTER SUBMITTAL SUMMARY

ENERGY UTILITY

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

Company name/CPUC Utility No. Pacific Gas and Electric Company (ID U39 E)

Utility type: Contact Person: Yvonne Yang

ELC GAS Phone #: (415) 973-3582

PLC HEAT WATER E-mail: QXY1@pge.com and PGETariffs@pge.com

EXPLANATION OF UTILITY TYPE

ELC = Electric GAS = Gas

PLC = Pipeline HEAT = Heat WATER = Water

(Date Submitted/ Received Stamp by CPUC)

Advice Letter (AL) #: 5279-E Tier: 2

Subject of AL: Details of PG&E’s SB350 Transportation Electrification Idle Reduction Technology Priority Review

Project

Keywords (choose from CPUC listing): Compliance

AL submittal type: Monthly Quarterly Annual One-Time Other _____________________________

If AL submitted in compliance with a Commission order, indicate relevant Decision/Resolution #: D.18-01-024

Does AL replace a withdrawn or rejected AL? If so, identify the prior AL: No

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

Is AL requesting confidential treatment? If so, what information is the utility seeking confidential treatment for: No

Confidential information will be made available to those who have executed a nondisclosure agreement: N/A

Name(s) and contact information of the person(s) who will provide the nondisclosure agreement and access to the confidential

information: __________________________________________________________________________________________________

Resolution Required? Yes No

Requested effective date: May 27, 2018 N No. of tariff sheets: N/A

Estimated system annual revenue effect (%): N/A

Estimated system average rate effect (%): N/A

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: N/A

Service affected and changes proposed: N/A

Pending advice letters that revise the same tariff sheets: N/A

Protests, dispositions, 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:

California Public Utilities Commission Pacific Gas and Electric Company

Energy Division

EDTariffUnit

505 Van Ness Ave., 4th Flr.

San Francisco, CA 94102

E-mail: EDTariffUnit@cpuc.ca.gov

Attn: Erik Jacobson

Director, Regulatory Relations

c/o Megan Lawson

77 Beale Street, Mail Code B13U

P.O. Box 770000

San Francisco, CA 94177

E-mail: PGETariffs@pge.com

Advice 5279-E April 27, 2018

Appendix A

PG&E Idle Reduction Technology Pilot An SB350 Priority Review Project

PG&E Idle Reduction Technology Pilot An SB350 Priority Review Project

4/5/18

4/5/2018 | Slide 2

Purpose• Provide members of the California Freight Advisory Council with information

on Pacific Gas & Electric Company’s (PG&E) Idle Reduction Technology pilot • Solicit member feedback on the proposal, as directed by the California Public

Utilities Commission (CPUC)

Action RequestedPlease review the project details and send your comments and questions to CFAC@dot.ca.gov no later than 5pm on April 16.

Table of Contents

I. Introduction Slides 3-4

II. Idling Reduction Market and Barriers to Adoption Slides 5-7

III. PG&E Idle Reduction Technology Pilot Slides 8-12

IV. Appendix Slides 13-21

Executive Summary

I. Introduction

4/5/2018 | Slide 4

Pursuant to the passing of Senate Bill 350, Pacific Gas & Electric Company (PG&E) filed a transportation electrification (TE) application focused on accelerating electrification in the medium and heavy duty sectors1

• PG&E’s filing proposed several “Priority Review Projects” (PRPs), including a pilot focused on idle reduction technology within the food services industry

– On January 11, 2018, the California Public Utilities Commission (CPUC) provided conditional approval of PG&E’s idle reduction pilot, contingent upon PG&E filing a Tier 2 Advice Letter

– The CPUC directed PG&E to solicit feedback from the California Freight Advisory Committee (CFAC) in advance of filing a Tier 2 Advice Letter:

“Prior to implementing its Idle Reduction Technology Project, Pacific Gas and Electric Company (PG&E) must file a Tier 2 Advice Letter with the Commission’s Energy Division identifying: (1) commitments from both truck stops and fleet operators; (2) PG&E’s efforts to engage and educate these partners throughout the duration of the pilot; (3) how PG&E will design this pilot to collect the necessary data to inform future rate designs that can make these idle reduction technologies economically feasible; and (4) whether PG&E plans to support truck stop electrification, transport refrigeration units, or both. Prior to filing, PG&E must present its Idle Reduction Technology Project before the California Freight Advisory Committee and report any feedback as part of its Tier 2 Advice Letter.” 2

PG&E’s SB350 Transportation Electrification Filing Targets the Medium & Heavy-Duty Sectors

1. See Appendix A1 – A3 for more detailed information on SB350, and PG&E’s proposed programs within the transportation electrification application.2. Decision D.18-01-024 Ordering Paragraph 28

II. Idle Reduction Technology and Barriers to Adoption

4/5/2018 | Slide 6

PG&E Has Identified Two Key Opportunities for Reducing Idling of Diesel Engines

1) Truck Cabin Comfort / Truck Stop Electrification 2) Transport Refrigeration Units (TRUs)

• Description: Reduce idling used by long-haul truckers to provide cabin heating, cooling, and power for electronics while resting

• Ideal Sites: Truck stops along freight corridors

• Target Market: Long-haul truckers, truck stop owners

• Description: Reduce idling used to pre-cool/heat and maintain temperature control of trailers delivering food products

• Ideal Sites: Food distribution centers and warehouses, food manufacturing facilities, dairy and meat processing facilities

• Target Market: Privately-owned return-to-base fleets

PG&E will focus on transport refrigeration units for its Idle Reduction Pilot

4/5/2018 | Slide 7

PG&E will support market growth by reducing

infrastructure-related barriers and producing education and

outreach materials

Many Barriers to Adoption of eTRU Technology Exist; Some Can be Addressed by Utilities

• Key barriers include:– Lack of electric infrastructure, often

due to cost– Lack of education and awareness on

eTRU technology and the possible savings

• PG&E has found a small number of fleet owners in its service territory who have already adopted eTRU technology

– However, many of them continue to use diesel engines for power in standby, due to a lack of charging infrastructure

Source: “Market and Technology Assessment of Electric Transport Refrigeration Units.” Electric Power Research Institute, December 2015.

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III. PG&E Idle Reduction Technology Project Details

4/5/2018 | Slide 9

PG&E will work with 1-2 grocery or food service customers to install at least 15 electrified parking spaces at one of the customers’ facilities

• PG&E is targeting customers with facilities located in disadvantaged communities3 and who currently own or have ordered a fleet of eTRUs

• PG&E would own and cover the cost for utility make-ready infrastructure up to the charger – including new service, electric panel, trenching, conduit, and design, permitting, and construction costs

• Fleet owner would be responsible for procurement of eTRUs and chargers

– PG&E will provide additional incentives to help with purchase of the chargers

• Following a year of data collection, PG&E will publish a handbook of lessons learned for industry education

• Total pilot budget = $1.72M

3. As defined by CalEnviroscreen 3.0. In PG&E’s community, census tracts with a percentile rating greater than or equal to 64.63% are considered a Disadvantaged Community.

Utility transmission & distribution infrastructure

Utility meter, panel, and conduit

Utility make-ready for charger

Utility make-ready infrastructure

Customer-owned charger (rebate to be

provided by PG&E)

PG&E’s Idle Reduction Project Proposal

4/5/2018 | Slide 10

• PG&E has spoken with more than four grocery and food service companies and is performing additional outreach to understand the broader eTRU opportunity

• PG&E has identified a dairy manufacturer in the San Joaquin Valley as its initial partner 4, 5

– Customer currently has between 15-30 eTRUs idling (using diesel fuel) at its facility while pre-cooling, loading, and awaiting dispatch

• PG&E may work with one additional customer for the pilot, budget allowing

• PG&E has also spoken with one truck stop owner and will continue outreach to understand the broader Truck Stop Electrification opportunity but PG&E will not pursue Truck Stop Electrification in this idle reduction technology pilot

– TCO in this space is more difficult to calculate as owners of charging infrastructure are not the fleet owners and incentives are low for truck drivers to utilize the infrastructure

4. See Appendix A.8 for more details on PG&E’s site and customer selection process.5. Pending approval of Tier 2 Advice Letter, detailed project design, and customer contract signing

Pilot Goals and Customer Outreach Status

Pilot Goals

1. Further the adoption of idle reduction technology by demonstrating lower Total Cost of Ownership (TCO) through:

a) Minimizing infrastructure costs: Working closely with customers to find efficiencies in infrastructure installation

b) Minimizing fuel costs: Testing the hypothesis that “electric fuel” costs compare favorably to the cost of diesel fuel spent while idling; assessing viability of tools such as storage and/or charge management software

2. Reduce emissions of air pollutants from diesel engines

Customer Outreach

4/5/2018 | Slide 11

Project Implementation Plan and TimelineProject Implementation Plan

• After receiving comments and feedback from CFAC, PG&E will file a Tier 2 Advice Letter with the CPUC

• Upon approval of PG&E’s Tier 2 Advice Letter and execution of a customer contract, PG&E would perform detailed design of the customer site and work with the customer to solidify detailed project scope

– PG&E would evaluate the buildout of between 15-25 electrified parking spaces

– PG&E would work with the customer to evaluate other tools, such as charge management software or energy storage, to reduce energy costs

• Customer would be required to provide PG&E an easement to construct and install all make-ready infrastructure

– Target installation date by January 2019

• Once chargers are activated, PG&E would coordinate with the customer to collect a year’s worth of data

• PG&E will use the data to evaluate total cost of ownership for fleet owners, future rate design opportunities, and success of the project; PG&E will also produce educational materials, such as lessons learned, for industry awareness and outreach

JunJan Feb Mar Apr May AugJul Sep Oct Nov Dec Jan 2019

Feb Mar... Jun 2019…

Jan 2020

Post Jan

2020

01 Initial Project Scoping & Customer Acquisition 02 Tier 2 Advice Letter

Filing & Approval 03 Detailed Project Design and Construction 04 Data Collection 05 Lessons Learned

Today

4/5/2018 | Slide 12

Request for Feedback from CFAC Members

PG&E is interested in hearing your thoughts on this pilot proposal.

Please send your comments and questions to CFAC@dot.ca.gov no later than 5pm on April 16.

Feedback Questions1. How does this project complement activities contemplated by CFAC?

2. Does this project address barriers to adoption in the industry? Are there barriers that are not being addressed that you feel are well-suited for utilities to tackle?

3. Please provide general comments and feedback on the project scope.

IV. Appendix

4/5/2018 | Slide 14

Senate Bill 350 – the Clean Energy and Pollution Reduction Act – was signed into law on Oct 7, 2015

• Established California’s 2030 greenhouse gas (GHG) reduction target of 40% below 1990 levels

• Established CA targets that included a 50 percent reduction in petroleum use in cars and trucks, a 50 percent increase in energy efficiency in buildings, and a goal of 50 percent of state utilities’ power coming from renewable energy, all by 2030

• Transportation electrification in SB 350:

“The Legislature finds and declares that … a principal goal of electric and natural gas utilities’ … shall be … to encourage … energy efficiency … renewable energy resources …, and widespread transportation electrification.”

• The legislation will be implemented through a collaboration by the California Public Utilities Commission (CPUC), the California Energy Commission (CEC), and the California Air Resources Board (CARB)

A1. Background – SB350 Establishes Goals for Transportation Electrification

4/5/2018 | Slide 15

CPUC Assigned Commissioner’s Ruling Pursuant to SB350 (Sept 2016)

• On September 2016, the CPUC issued guidance setting forth the requirements for the investor-owned utilities’ transportation electrification (TE) Applications.

• Directed the three investor-owned utilities (IOUs) to file a first round of TE applications by January 20, 2017

– Expressly limited applications to Electric Vehicles (EVs) (i.e. no hydrogen or natural gas proposals to be included)

• PG&E’s filing focused on electrification within the medium and heavy duty sector and included:

– $20M split between five 1-year projects ($4M max per project) for “priority review” (i.e. the Priority Review Projects or PRPs)

o Included a PRP focused on idle reduction technology within the food services industry

– 2-5 year “standard review” programs

– Included a “Fleet Ready Program” which would target electrification of medium to heavy duty fleet vehicles (e.g. transit buses, school buses, forklifts, transport refrigeration units)

– Included a Direct Current Fast Charging (DCFC) Program which would install 50+ DCFC in transit corridors across PG&E’s service territory for use by light-duty passenger vehicles

– Additional rebates for charging equipment and funding to support specific marketing, education, and outreach

A2. Background – SB350 Implementation by the CPUC and Utilities

4/5/2018 | Slide 16

On January 11, 2018, the CPUC Approved fifteen SB350 Priority Review Projects (PRPs) that were included in the IOUs’ TE Applications

• PG&E proposed five PRPS, four of which are focused on accelerating electrification in the medium and heavy duty sectors a

• The CPUC provided conditional approval for PG&E’s idle reduction pilot (more detail on following pages)

– Full approval is contingent upon PG&E filing a Tier 2 Advice Letter

– The CPUC directed PG&E to solicit feedback from CFAC in advance of filing its Advice Letter:

“Prior to implementing its Idle Reduction Technology Project, Pacific Gas and Electric Company (PG&E) must file a Tier 2 Advice Letter with the Commission’s Energy Division identifying: (1) commitments from both truck stops and fleet operators; (2) PG&E’s efforts to engage and educate these partners throughout the duration of the pilot; (3) how PG&E will design this pilot to collect the necessary data to inform future rate designs that can make these idle reduction technologies economically feasible; and (4) whether PG&E plans to support truck stop electrification, transport refrigeration units, or both. Prior to filing, PG&E must present its Idle Reduction Technology Project before the California Freight Advisory Committee and report any feedback as part of its Tier 2 Advice Letter.” b

a. See Appendix A7 for a description of PG&E’s proposed priority review projectsb. Decision D.18-01-024 Ordering Paragraph 28

A3. Background – Utility SB350 Activities Begin with Approved Priority Review Projects

4/5/2018 | Slide 17

A4. PG&E at a glance

Key Highlights

Employees

Californians served

Net income (2016)

Revenue (2016)

Miles of electric lines

MW utility-owned generation

GWh electricity generated and procured

~24,000

~16M

~$1.4B

~$17.6B

~160,000

~7,700

~68,500

Miles of natural gas pipelines ~50,000

Carbon-free and renewable energy delivered ~70%

4/5/2018 | Slide 18

A5. PG&E has proposed to invest $380M in EV infrastructure

APPROVED PROPOSED PROPOSED

Fast Charge

• 50+ plazas for DC Fast Charging; utility provides make-ready infrastructure

• $22 million; 5 years

• Corridor and urban sites

• Plan for variety of power requirements (50 – 350 kW)

• Additional incentives for disadvantaged communities

FleetReady

• Make-ready infrastructure for non-light-duty fleets (e.g. delivery vans, transit buses, forklifts, truck refrigeration)

• $211 million; 5 years

• Program sized to meet forecasted adoption

• Additional incentives for disadvantaged communities, school and transit buses

EV Charge Network

• 7,500 Level 2 chargers (10-20 chargers per site)

• $130 million; 3 years

• Targeting Workplaces, multi-unit dwellings

• Turnkey installation from utility covers most costs; rebate/participation payment for site hosts

4/5/2018 | Slide 19

Residential charger marketplaceMedium-duty customer demonstration

School bus excess supply price signal Idle-reduction

customer demonstration

Medium- and heavy-duty

Public transit School buses Delivery fleets Private shuttles

Idle-reduction (truck-stops, truck refrigeration units)

Class 1 forklifts

Port, rail and airport equipment

PG&E GRC Phase II rate proposals (reduced demand charges for 20 – 500 kw customers)

Light-duty EV Infrastructure:

– Phase 1 (pending)– Phase 2 (planned)

DC fast charger (DCFC) make-ready program

Medium-/heavy-dutyLight-duty Off-road

“FleetReady” (non-light-duty make-ready) program with targeted incentives for beachhead sectors and DACs

BMW i ChargeForward

EV submetering

DC fast charger siting tool

Open vehicle-grid integration platformR&D

Infra-structure

Program / Rate Design

A-1 transit bus rate pilot Vehicle on-site grid support system

Residential EV rates

Clean Fuel Rebate (LCFS)

Note: Initiatives in black were included in PG&E’s January SB350 Transportation Electrification (TE) application. Initiatives in green are part of PG&E’s TE portfolio that are either complete, underway, or expected to occur in the future.

Priority review

projects

Standard CPUC

review

A6. PG&E’s Transportation Electrification Portfolio

4/5/2018 | Slide 20

A7. Summary of PG&E’s Approved SB350 Priority Review Projects

1

2

3

4

Medium/Heavy Duty Fleet Customer DemonstrationPG&E will partner with one fleet customer to demonstrate a lower total cost of ownership for an electric fleet and produce a handbook of lessons learned. PG&E will deploy make-ready infrastructure, offer a rebate for the EVSE, and provide technical assistance to one fleet. The fleet should be located in a disadvantaged community.

Electric School Bus Renewables IntegrationPG&E will deploy make-ready infrastructure to serve two to five school buses. PG&E will explore opportunities to manage the charging of the buses so they charge during times with excess renewable energy mid-day. Charging incentives could include participation in a demand response program, or some other mechanism. This project will be deployed in a school district that primarily serves one or more disadvantaged communities.

Idle Reduction TechnologyPG&E will demonstrate idle-reduction technologies for truck stop electrification or transport refrigeration units in a disadvantaged community. PG&E must first develop a more detailed implementation plan for this project and submit it to the CPUC for approval. The plan should identify truck stops and fleet operators that PG&E intends to work with, discuss data collection efforts that will help with rate design for idle reduction technologies, and provide more information and analysis regarding which idle reduction technologies PG&E will support.

Home Charger Information Resource PilotPG&E will enhance the EV information it provides on its website, including checklists to help customers know what to look for when searching for charging stations or contractors to install them. Information should also be translated into other languages PG&E customers speak.

Approved

Approved

Pending Tier 2 Advice Letter

Filing

Status

Pending Tier 2 Advice Letter

Filing

4/5/2018 | Slide 21

Geographic Diversity

Disadvantaged Community

(DAC) Status

Procurement Timeline

Cost, Ability, Timing to Build

Sited in a PG&E Disadvantaged Community *

Dispersed throughout

PG&E service territory

Owns its own fleet

Electric vehicles already ordered

Grant funding requested

Electric fleet procurement

plan developed

Can be built by end of year

2018

Costs in line with initial

estimates from SB350 filing

* Received percentile rating greater than or equal to 64.63% per Cal Enviro Screen 3.0

Best fit

Minimally acceptable

AND

OR

AND

OR

A.8 Evaluation Criteria for PRP Sites/Customers

PG&E Gas and Electric Advice Filing List General Order 96-B, Section IV

AT&T Downey & Brand Pioneer Community Energy Albion Power Company Ellison Schneider & Harris LLP Praxair Alcantar & Kahl LLP Energy Management Service Regulatory & Cogeneration Service, Inc. Anderson & Poole Evaluation + Strategy for Social

Innovation SCD Energy Solutions

Atlas ReFuel GenOn Energy, Inc. SCE BART Goodin, MacBride, Squeri, Schlotz &

Ritchie SDG&E and SoCalGas

Barkovich & Yap, Inc. Green Charge Networks SPURR Braun Blaising Smith Wynne P.C. Green Power Institute San Francisco Water Power and Sewer CalCom Solar Hanna & Morton Seattle City Light California Cotton Ginners & Growers Assn ICF Sempra Utilities California Energy Commission International Power Technology Southern California Edison Company California Public Utilities Commission Intestate Gas Services, Inc. Southern California Gas Company California State Association of Counties Kelly Group Spark Energy Calpine Ken Bohn Consulting Sun Light & Power Casner, Steve Keyes & Fox LLP Sunshine Design Cenergy Power Leviton Manufacturing Co., Inc. Tecogen, Inc. Center for Biological Diversity Linde TerraVerde Renewable Partners City of Palo Alto Los Angeles County Integrated Waste

Management Task Force Tiger Natural Gas, Inc.

City of San Jose Los Angeles Dept of Water & Power TransCanada Clean Power Research MRW & Associates Troutman Sanders LLP Coast Economic Consulting Manatt Phelps Phillips Utility Cost Management Commercial Energy Marin Energy Authority Utility Power Solutions County of Tehama - Department of Public Works

McKenzie & Associates Utility Specialists

Crossborder Energy Modesto Irrigation District Verizon Crown Road Energy, LLC Morgan Stanley Water and Energy Consulting Davis Wright Tremaine LLP NLine Energy, Inc. Wellhead Electric Company Day Carter Murphy NRG Solar Western Manufactured Housing

Communities Association (WMA) Dept of General Services Office of Ratepayer Advocates Yep Energy Don Pickett & Associates, Inc. OnGrid Solar Douglass & Liddell Pacific Gas and Electric Company