Update Texas PUC OKs Settlement To End AEP Texas Efficiency Program Reimbursing REPs for LED Lamps If Not Cost-Effective This Year

Update, 9/9: The Texas PUC approved the proposed orders adopting the stipulations as modified by Commissioner Brandy Marty Marquez's changes

From 9/8:

Stipulations in the AEP Texas Central's and AEP Texas North's energy efficiency cost recovery factor proceedings would require that the Energy Connection Pilot Market Transformation Program not be offered in 2017 if the program is not cost-effective in 2016.

The AEP Texas Energy Connection Pilot is a program which targets residential customers by partnering with Retail Electric Providers (REPs) who will promote energy efficiency to their customers. Under this program, REPs initially offer customers LED lamps at a discounted price via an online marketplace. AEP Texas offers incentives for REPs to reduce the costs of the bulbs to the customer

The programs were not cost-effective in 2015, which was the first year of the program

At TCC, the program had a cost-benefit ratio of 0.45 in 2015, which is below the required ratio of 1.0 (showing that the costs equal the benefits).

At TNC, the benefit-cost ratio of the program is 0.23

However, AEP Texas expects the programs to be cost-effective by the end of the year, with participation in the first five months of 2016 exceeding participation for 2015

Accordingly, stipulations among AEP Texas, PUCT Staff and TIEC provides that the AEP Texas utilities will not continue the Efficiency Connection Pilot program in 2017 if it is not cost effective in 2016.

Proposed orders in each of the AEP Texas EECRF would adopt the stipulations, but such proposed orders do not explicitly recite the stipulations' terms regarding the potential termination of the Efficiency Connection Pilot.

Commissioner Brandy Marty Marquez has proposed modifying the proposed orders to explicitly state that the Energy Connection Pilot Market Transformation Program was not cost-effective in 2015 and that TCC and TNC will not continue the Energy Connection Pilot Market Transformation Program in 2017 if it is not cost-effective in 2016.

The Commission is scheduled to consider the proposed orders at today's open meeting

Dockets 45928, 45929