November 1, Advice 4949-E (Pacific Gas and Electric Company ID U 39 E) Public Utilities Commission of the State of California

Transcription

1 Erik Jacobson Director Regulatory Relations Pacific Gas and Electric Company 77 Beale St., Mail Code B10C P.O. Box San Francisco, CA Fax: November 1, 2016 Advice 4949-E (Pacific Gas and Electric Company ID U 39 E) Public Utilities Commission of the State of California Subject: Purpose Pacific Gas and Electric Company s Marketing, Education & Outreach Plan in Compliance With December 17, 2015 Assigned Commissioner and Administrative Law Judge s Ruling and Decision This Advice Letter (AL) requests approval of Pacific Gas and Electric Company s (PG&E s) Marketing, Education & Outreach (ME&O) Plan in compliance with the December 17, 2015 Assigned Commissioner and Administrative Law Judge s Ruling Requiring Utilities to Prepare Comprehensive Marketing, Education and Outreach, Metrics, Goals and Strategies for Residential Rate Reform, and Decision (D.) (Decision), Decision on Residential Rate Reform for Pacific Gas and Electric Company, Southern California Edison Company, and San Diego Gas & Electric Company and Transition to Time-of-Use Rates. Background On July 3, 2015, the California Public Utilities Commission (Commission or CPUC) issued D that raised the importance of providing adequate marketing, education and outreach to customers so that they can understand and respond appropriately to their electricity rates 1. In addition, D identified the need for targeted ME&O for two groups of customers that will be highly affected by residential rate reform: low usage customers and customers who use more than 400% of baseline quantities of electricity. The Decision also required the Investor Owned Utilities (IOUs) to form an ME&O Working Group, which would specifically address the program to promote low-cost and no-cost energy-efficiency options for current Tier 1 and Tier 2 customers, as well as long-term residential outreach. 2 1 D , p D , OP 14

2 Advice 4949-E November 1, 2016 In its December 17, 2015 Assigned Commissioner and Administrative Law Judge Ruling, the Commission further clarified ME&O requirements for residential rate reform, directing the IOUs to: (1) hire a consultant to advise the ME&O Working Group on appropriate ME&O metrics, goals and strategies for meeting those goals, and (2) prepare a comprehensive ME&O plan with strategies for implementing Residential Rate Reform. 3 The December 2015 Ruling set forth objectives for the ME&O consultant to deliver: (1) metrics with goals and targets, (2) a strategic action plan for IOUs to achieve said targets, and (3) a plan for statewide ME&O program coordination. Through a competitive bidding process and under the direction of the CPUC s Energy Division, Greenberg Inc. (Greenberg) was chosen as the independent consultant to assist the ME&O Working Group with appropriate goals, metrics and strategies. Greenberg began working on the project in May 2016 and released a report (MEO Blueprint 4 ) on August 20, The Blueprint proposed a vision, metrics for residential rate reform, and an ME&O implementation plan, in preparation for the 2019 default of customers on time-of-use (TOU) rates. PG&E s ME&O Plan, included with this advice letter as Attachment 1, builds on the Working Group s efforts and the Greenberg MEO Blueprint. PG&E s three-year proposed plan covers the ME&O efforts to be implemented in 2017 and will continue through the default of customers to TOU rates in PG&E s ME&O plan is structured using the revised chapter outline issued in the ALJ ME&O ruling on September 30, 2016, providing a revised common outline incorporating comments from the September 12, 2016 workshop. PG&E's ME&O plan aligns with the Commission s intent for Rate Reform, which includes: making rates more understandable to customers and more cost-based; and implementing default TOU rates in a meaningful way that empowers residential electricity customers and encourages them to conserve energy and shift their usage to times of day that support a cleaner more reliable grid. PG&E s ME&O plan is intended to increase customer s awareness, understanding and engagement of their electricity rates and prepare them for default to TOU rates in Protests Anyone wishing to protest this filing may do so by letter sent via U.S. mail, facsimile or , no later than November 21, 2016 which is 20 days after the date of this filing. Protests must be submitted to: 3 The December 2015 Administrative Law Judge (ALJ) Ruling directed the IOUs to file their respective ME&O plans by September 1, On May 26, 2016, an ALJ Ruling was issued extending the due date for the ME&O plans to be no later than the due date for the Energy Efficiency Business Plans and no later than November 1, Per the October 7, 2016 ALJ Ruling, Greenberg s MEO Blueprint has been added to the record of R for reference purposes. Thus, PG&E will not attach the MEO Blueprint to this advice letter and will reference it going forward.

3 Advice 4949-E November 1, 2016 CPUC Energy Division ED Tariff Unit 505 Van Ness Avenue, 4 th Floor San Francisco, California Facsimile: (415) 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 PG&E either via 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 B10C P.O. Box San Francisco, California Facsimile: (415) 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) 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 respectfully requests that this Tier 3 AL be approved and become effective as of the Commission s March 2, 2017 decision conference.

4 Advice 4949-E November 1, 2016 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 R Address changes to the General Order 96-B service list should be directed to PG&E at address PGETariffs@pge.com. For changes to any other service list, please contact the Commission s Process Office at (415) or at Process_Office@cpuc.ca.gov. Send all electronic approvals to PGETariffs@pge.com. Advice letter filings can also be accessed electronically at: /S/ Erik Jacobson Director, Regulatory Relations Attachment cc: Service List R

5 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. Pacific Gas and Electric Company (ID U39 E) Utility type: Contact Person: Annie Ho ELC GAS Phone #: (415) PLC HEAT WATER and EXPLANATION OF UTILITY TYPE ELC = Electric GAS = Gas PLC = Pipeline HEAT = Heat WATER = Water (Date Filed/ Received Stamp by CPUC) Advice Letter (AL) #: 4949-E Tier: 3 Subject of AL: Pacific Gas and Electric Company s Marketing, Education & Outreach Plan in Compliance With December 17, 2015 Assigned Commissioner and Administrative Law Judge s Ruling and Decision Keywords (choose from CPUC listing): Compliance, Energy Efficiency AL filing type: Monthly Quarterly Annual One-Time Other If AL filed in compliance with a Commission order, indicate relevant Decision/Resolution #: D 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: March 2, 2017 Estimated system annual revenue effect (%): N/A Estimated system average rate effect (%): N/A No. of tariff sheets: 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 filing, 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., 4 th Flr. San Francisco, CA EDTariffUnit@cpuc.ca.gov Attn: Erik Jacobson Director, Regulatory Relations c/o Megan Lawson 77 Beale Street, Mail Code B10C P.O. Box San Francisco, CA PGETariffs@pge.com

6 PACIFIC GAS AND ELECTRIC COMPANY RESIDENTIAL RATE REFORM MARKETING, EDUCATION AND OUTREACH PLAN IN COMPLIANCE WITH CPUC DECISION AND DECEMBER 17, 2015 ASSIGNED COMMISSION AND ADMINISTRATIVE LAW JUDGE RULING NOVEMBER 1, 2016

7 PACIFIC GAS AND ELECTRIC COMPANY RESIDENTIAL RATE REFORM MARKETING, EDUCATION AND OUTREACH PLAN IN COMPLIANCE WITH CPUC DECISION AND DECEMBER 17, 2015 ASSIGNED COMMISSION AND ADMINISTRATIVE LAW JUDGE RULING NOVEMBER 1, 2016 TABLE OF CONTENTS I. Executive Summary... 1 A. Summary of PG&E s Overarching Marketing Plan... 2 B. Summary of Voluntary Time-of-Use (TOU) Plans... 3 C. Summary Default TOU Plan... 4 D. Alignment With the Greenberg Blueprint... 4 II. Regulatory Background and Objectives... 6 A. Regulatory Background... 6 B. Regulatory Risks... 8 C. Objectives III. Market and Situation Overview A. Customer Engagement and Program Enrollment B. Energy Efficiency Opportunity Score C. PG&E Residential Customer Personas D. Customers Media Consumption E. Customers Relationship With Energy F. Rate Understanding: What Customers Want from a Rate and Rate Communications G. Default TOU Segmentation Strategy IV. Product Profiles and Evolution A. Standard Tiered Rates B. Pre-Existing Optional TOU Rates Standard Tiered Rates C. Newly Introduced Voluntary TOU Rates D. Opt-In TOU Pilot Project i-

8 PACIFIC GAS AND ELECTRIC COMPANY RESIDENTIAL RATE REFORM MARKETING, EDUCATION AND OUTREACH PLAN IN COMPLIANCE WITH CPUC DECISION AND DECEMBER 17, 2015 ASSIGNED COMMISSION AND ADMINISTRATIVE LAW JUDGE RULING NOVEMBER 1, 2016 TABLE OF CONTENTS (CONTINUED) E. Other Rate Changes F. High Usage Surcharge Outreach and Implementation V. Learning from Current Efforts A. Recap of 2016 Rate Reform Campaigns B. Tier 1 and Tier 2 Winter Customer Outreach (Winter 2016) C. E-8 Rate Elimination D. E-7 Rate Elimination and Transition E. Summer Heat Campaign Targeted Media Outreach Web Traffic F. Opt-In TOU Pilot Outreach Opt-In Pilot Participant Acquisition Education and In-Season Outreach Summary a. Welcome Kits b. Summer Seasonal Outreach c. Smartphone App Invite d. Opt-In Pilot Results Overall e. Results to Date G. Small and Medium Business Default TOU Key Learnings Leveraging Key Stakeholders and Constituents to Spread the Message Communications Clarity and Timing H. General Website and Contact Center Results ii-

9 PACIFIC GAS AND ELECTRIC COMPANY RESIDENTIAL RATE REFORM MARKETING, EDUCATION AND OUTREACH PLAN IN COMPLIANCE WITH CPUC DECISION AND DECEMBER 17, 2015 ASSIGNED COMMISSION AND ADMINISTRATIVE LAW JUDGE RULING NOVEMBER 1, 2016 TABLE OF CONTENTS (CONTINUED) VI. Overall Marketing, Outreach, and Education Introduction A. Marketing Plan Objectives B. Marketing Goals C. Target Audience D. Marketing Strategies Tools and Tips Engagement Campaign Pre-Summer and Pre-Winter Seasonal Campaigns a. Pre-Summer and Pre-Winter Media Plan Engagement Tests a. Gamification Program b. Energy Engagement Kits c. Behavioral Pledges d. Increase Online Accounts e. Engagement With Specialized Energy Statement Formats E. Emotional Quotient (EQ) & Intelligence Quotient (IQ) Message Approach F. Considerations for Specific Customer Groups VII. Statewide Marketing, Education and Outreach Campaign Plan A. Alignment With the Greenberg Blueprint B. Further Considerations Required for a Statewide Campaign C. Statewide Integration Recommendations D. Marketing Consultant Recommendation iii-

10 PACIFIC GAS AND ELECTRIC COMPANY RESIDENTIAL RATE REFORM MARKETING, EDUCATION AND OUTREACH PLAN IN COMPLIANCE WITH CPUC DECISION AND DECEMBER 17, 2015 ASSIGNED COMMISSION AND ADMINISTRATIVE LAW JUDGE RULING NOVEMBER 1, 2016 TABLE OF CONTENTS (CONTINUED) E. Statewide Budget Recommendation F. Schedule Recommendation VIII. IOU Marketing Plan A. Voluntary TOU Acquisition TOU Bill Impact Analysis Benefits of Voluntary TOU for Certain Low Income Customers Customers Who Can Win Now But Would Lose on Default TOU : Emphasis on ETOU-B : Addition of ETOU-A Marketing Messages and Strategies Marketing Tactics a. Acquisition Tactics b. Retention Tactics Risks and Open Issues B. Default TOU Outreach Segmentation Marketing Strategy Exclusions and Considerations for Specific Customer Groups Messaging Approach Pre-Certification of Ineligibility for TOU Post-Default Retention Communications C. Support Channels iv-

11 PACIFIC GAS AND ELECTRIC COMPANY RESIDENTIAL RATE REFORM MARKETING, EDUCATION AND OUTREACH PLAN IN COMPLIANCE WITH CPUC DECISION AND DECEMBER 17, 2015 ASSIGNED COMMISSION AND ADMINISTRATIVE LAW JUDGE RULING NOVEMBER 1, 2016 TABLE OF CONTENTS (CONTINUED) 1. PG&E s Approach to Marketing Integration a. Integration Considerations b. Examples of Prior Integration Efforts c. Examples of Residential Rate Reform Integration Initiatives d. Future Residential Rate Reform Integration Efforts for e. Potential Rate Reform Integrated Outreach Opportunities for f. Reporting of Integration Efforts PGE.com Website a. Recent Rate Reform Website Improvements b. Future Rate Reform Website Improvements c. General PGE.com Improvements d. Online Energy Management Tools PG&E Contact Center a. Training for Customer Service Representatives b. Resources for Customer Service Representatives c. Start/Transfer Service Enhancements d. Welcome Kits for New Customers e. Communications Campaign Overview: Media and Employees Media Relations (Public Relations) a. Regional Grassroots Public Awareness b. Media Influencer Relations v-

12 PACIFIC GAS AND ELECTRIC COMPANY RESIDENTIAL RATE REFORM MARKETING, EDUCATION AND OUTREACH PLAN IN COMPLIANCE WITH CPUC DECISION AND DECEMBER 17, 2015 ASSIGNED COMMISSION AND ADMINISTRATIVE LAW JUDGE RULING NOVEMBER 1, 2016 TABLE OF CONTENTS (CONTINUED) c. Educational Curriculum d. Thought Leadership Platform e. Digital and Social Media f. Social Media Presence g. Employee Education IX. Partner and Community-Based Organization (CBO) Strategy A. Approach for CBO Strategy B. Alignment with the Greenberg Blueprint on Network of Networks Framework C. PG&E s CBO Partners Actively Engage Hard-to-Reach Communities D. PG&E Will Employ a Multifaceted Community Engagement Plan Internal Coordination and Leadership External Coordination and Community Partnerships E. Prioritization of Communities Impacted By Rate Changes F Community Engagement Work Plan for Residential Rate Awareness G. Ongoing Training and Support for CBO Partners H. Integration with Low-Income Proposed Decision and Alternate Proposed Decision X. Measurement and Metrics A. Metrics Goals and Objectives B. ME&O Working Group Recommendations for Draft Metrics C. Survey Approach Baseline Survey vi-

13 PACIFIC GAS AND ELECTRIC COMPANY RESIDENTIAL RATE REFORM MARKETING, EDUCATION AND OUTREACH PLAN IN COMPLIANCE WITH CPUC DECISION AND DECEMBER 17, 2015 ASSIGNED COMMISSION AND ADMINISTRATIVE LAW JUDGE RULING NOVEMBER 1, 2016 TABLE OF CONTENTS (CONTINUED) D. Alignment With Greenberg Blueprint Recommendation on Metrics E. Discussion of ME&O Survey-Based Metrics and Implications for the Survey Goal Constructs for Discussion and Consideration are: a. Awareness of TOU: b. Awareness of Rate Options: c. A Positive Customer Experience: Draft Goal Metrics F. Method and Timing of ME&O Study Understanding our Customer: Segment-Specific Outreach and Surveys G. Tracking Outreach Efforts H. Tracking Community-Based Outreach Efforts I. Tracking Engagement and Customer Actions XI. Budget A. Introductory Caveats B. PG&E s Preliminary RROIR ME&O Budget Estimates C. PG&E s Preliminary, Utility-Specific RROIR ME&O Budget Estimates XII. Marketing Automation A. Current Marketing Automation B. Future Marketing Automation Journey Builder Advertising Studio vii-

14 PACIFIC GAS AND ELECTRIC COMPANY RESIDENTIAL RATE REFORM MARKETING, EDUCATION AND OUTREACH PLAN IN COMPLIANCE WITH CPUC DECISION AND DECEMBER 17, 2015 ASSIGNED COMMISSION AND ADMINISTRATIVE LAW JUDGE RULING NOVEMBER 1, 2016 TABLE OF CONTENTS (CONTINUED) 3. Social Studio viii-

15 PACIFIC GAS AND ELECTRIC COMPANY QUARTERLY REPORT RESIDENTIAL RATE REFORM MARKETING, EDUCATION AND OUTREACH PLAN IN COMPLIANCE WITH CPUC DECISION AND DECEMBER 17, 2015 ASSIGNED COMMISSION AND ADMINISTRATIVE LAW JUDGE RULING NOVEMBER 1, 2016 I. Executive Summary Pacific Gas and Electric Company (PG&E or the Company) submits this proposed Residential Rate Reform Marketing, Education and Outreach (ME&O) plan to the California Public Utilities Commission (CPUC or Commission) as Attachment 1 to the Advice Letter required by the December 17, 2015 Assigned Commission and Administrative Law Judge s (ALJ) Ruling. That Ruling required the three Investor Owned Utilities (IOU) to each prepare and file a comprehensive ME&O plan for customer communications relating to Residential Rate Reform. PG&E s 3-year proposed plan covers the ME&O efforts PG&E expects to implement in 2017 and 2018 and to continue through the full-scale default of residential customers to Time-of-Use (TOU) rates, targeted for 2019, as envisioned in the CPUC s Residential Rate Reform OIR (RROIR) Phase 1 Decision (D.) Over the next three years, PG&E intends to take customers on an energy management journey that will prepare them for the transition to default TOU in PG&E does not underestimate the challenge ahead, given that: 1) a transition of this magnitude and complexity (with default TOU potentially involving upwards of 4 million PG&E residential customers) has never been undertaken in California before; 2) our customers have a low engagement with energy the average time a consumer spends interacting with their utility is only 20 minutes per year; 1 3) there is intense competition for our customers attention in a media-saturated world; and 4) the human attention span is ever-decreasing just 8.25 seconds. 2 In addition to these market conditions, PG&E and the other IOUs are challenged by the fact that there are many unknowns, with numerous decisions still to be made prior to default TOU that will impact ME&O strategies such as: 1 Accenture New Energy Consumer Research Attention Span Statistics Statistic Brain Statistic Brain Research Institute, publishing as Statistic Brain. July 2,

16 1) What will be the final, approved default TOU rate? 2) Will enrollment be done on a rolling, phased basis versus a big bang approach? 3) What will be the final requirements for customer eligibility for default to TOU? 4) What will be the results from the Opt-In and Default TOU Pilots? and 5) When will the CPUC issue its approval of a final default TOU plan? 3 PG&E s approach to ME&O in support of RROIR D is to increase customers engagement with energy management through rate options, tools, tips and programs to prepare them for the eventual transition to default TOU in the most efficient and cost-effective way. A consistent theme throughout the following chapters is that our proposed ME&O efforts seek to prioritize a positive customer experience. Segmentation and personalization receive heavy attention, to better enable PG&E to increase the relevance of these communications and deliver the right message to the right customer at the right time, and also make customers resulting actions as easy and seamless as possible. Also notable is the attention to a multi-channel approach to increase the chances of engaging with our customers where they already are. This strategic effort of preparing our customers for the coming changes in 2019 is described in further detail in Chapter VI Overall ME&O Introduction. PG&E appreciates the efforts of the Residential Rate Reform ME&O Working Group (WG), the Energy Division staff, and Greenberg Inc. (Greenberg) for their diligent and collaborative efforts during the months leading up to PG&E s final development of this plan. PG&E s ME&O plan aligns with the Commission s intent for Rate Reform, which includes: making rates more understandable to customers and more cost-based; and implementing default TOU rates in a meaningful way that empowers residential electricity customers and encourages them to conserve energy and shift their usage to times of day that support a cleaner more reliable grid. A. Summary of PG&E s Overarching Marketing Plan The overarching objectives of PG&E s ME&O Residential Rate Reform efforts are to generate awareness, understanding and engagement with PG&E customers. PG&E s 3 PG&E will require up to six months to begin defaulting customers to TOU after a final CPUC decision is issued. This lead time is necessary in order to complete billing system programming, online tools, bill impact analysis, and prepare final marketing materials. The timing can be decreased if the Commission adopts a rate already programmed into PG&E s billing system. The schedules shown in this document could change depending on the outcomes on these variables. -2-

17 plan will focus on educating customers on the choices and control they have over their bill by familiarizing customers with different rate options, tools, programs and tips that can help them better manage their energy use. PG&E will reach out to its most impacted customers with summer and winter campaigns to provide them with seasonally-relevant information during the highest use periods, and assist them in learning how to better manage their energy usage during the months when they are most likely to be motivated to take action. The overarching marketing strategy for PG&E s utility-specific ME&O efforts 4 will evolve in three phases through the 2017 to 2019 period. In Phase 1 (2017), the focus will be to lay the foundation for engagement with customers and deploy a test and learn approach with multiple outreach tactics designed to gain insights on the most effective ways to engage with customers. In Phase 2 (2018), PG&E will optimize the outreach based on lessons learned from 2017 and scale to drive deeper engagement with rate options, tools, tips and programs to help customers further manage their energy usage and prepare for default to TOU rates in Finally, in Phase 3, during 2019, PG&E will continue to drive customers engagement with energy management, and begin targeted communications to prepare customers for default with messages that are tailored to their level of likely bill impact. B. Summary of Voluntary Time-of-Use (TOU) Plans PG&E currently has two available residential TOU rate plans, ETOU-A and ETOU-B. Combined, they currently have just over 41,000 customers, and are growing at a rate of approximately 2,000 per month. In the next couple of years, prior to default TOU, PG&E proposes to embark on a campaign of voluntary customer acquisition to expand enrollments on these existing TOU rates. The aim of these voluntary TOU campaigns is to cost-effectively move toward getting more of the right customers onto the right rates for them, and then helping them succeed on that rate. This presents an opportunity to provide positive customer experiences, reduced load at peak hours, and provide critical learning about how to best improve customers knowledge, attitudes and practices regarding TOU rates and peak energy use prior to default TOU in PG&E also assumes that there will be a Statewide ME&O effort, providing high level, emotionally engaging messaging that prepares customers for the more specific outreach that will be undertaken by PG&E as proposed in this plan. (See Chapter VII, below, discussing the next steps PG&E recommends for such statewide marketing, which needs to move forward into the planning stage in Q1 2017). -3-

18 C. Summary Default TOU Plan PG&E is preparing to transition eligible residential customers to a default TOU rate in This ME&O plan, in support of this unprecedented rate transition for millions of PG&E residential customers, has been developed utilizing PG&E s in-market data and experience executing previous ME&O, the Greenberg Blueprint, learnings from other TOU initiatives, including Sacramento Municipal Utility District (SMUD), 5 and PG&E s hands-on experience from the relatively recent successful transition of Small and Medium Business (SMB) customers to mandatory TOU rates in recent years. 6 PG&E s ME&O plan assumes a rolling, phased default strategy, and will incorporate learnings from the ongoing Opt-In TOU Pilot, the upcoming Default TOU Pilot in 2018, and the planned voluntary TOU acquisition campaigns in 2017 and 2018, all of which will provide important insights to support a more successful execution of this huge rate transition. While the specific rate PG&E will propose in its 2018 Rate Design Window (RDW) Application, to be filed January 1, 2018, has not yet been specifically formulated, PG&E currently assumes that its proposed default TOU rate will have a mild price differential between on-peak and off-peak time periods, as the CPUC recommended in D As a result, PG&E has incorporated a strong emphasis on conservation into its ME&O messaging plans, and not just on shifting load away from peak periods, as both such efforts will be important for helping customers manage their energy use, and ultimately, their bills. D. Alignment With the Greenberg Blueprint In developing PG&E s ME&O plan, PG&E reviewed the Greenberg Blueprint and incorporated the most applicable concepts. These include: (1) acknowledging the key challenges, (2) utilizing Emotional Quotient (EQ) in statewide and to some degree in IOU specific messaging, (3) prioritizing an optimal customer experience, and (4) the principle of developing strategic goals and monitoring metrics based on the objectives. PG&E agrees with the Greenberg Blueprint s observation that the biggest challenge is motivating change in an unengaged customer, who does not care about electricity, and 5 Smart Grid Investment Grant, Time-of-Use as a Default Rate for Residential Customers: Issues and Insights, June D (modifying D and D ) approved November 10, 2011 in PG&E s 2009 RDW Application (A ). In D the CPUC approved a rolling default schedule for SMB customers over several years, beginning on November 1, D , mimeo, pp

19 when they do, it is mostly in negative circumstances when their bill spikes. 8 To support successful implementation of Residential Rate Reform, an increase in customer energy management education to deepen customer engagement is appropriate. The Greenberg Blueprint emphasized the concept of prioritizing the ME&O messaging on EQ over Intellectual Quotient (IQ). 9 PG&E believes Greenberg may have overemphasized EQ. PG&E recommends a mixture of EQ and IQ in IOU specific communications, guided by customer research. Sharing IQ-related content (such as rate mechanics 10 and TOU rate related bill impacts) in customer-friendly language will help them understand how Rate Reform impacts their choices and energy bill. In turn, this power of information will help them to decide whether they want to make use of the tools PG&E is making available to them. The Greenberg Blueprint states 11 this reform will only succeed with best practice ME&O strategy and implementation that centers on customer experience. PG&E emphasizes customer experience throughout this ME&O plan, and acknowledges that effortless and satisfactory experiences are core to increasing customer engagement. PG&E agrees with Greenberg that metrics must be meaningful, account for change and determine progress. 12 In terms of the Greenberg Blueprint vision metrics assigned to IOUs, PG&E believes that customer awareness of rate choices and customers feeling they are on the right rate are more appropriate indicators of success than TOU retention. In addition, because the customer experience is PG&E s focus throughout the transition to TOU, elevating a positive customer experience metric is recommended. PG&E s ME&O plan has been designed to be flexible; however assumptions had to be made about the open decisions and unknowns referenced above, as well as lack of 8 RROIR MEO Blueprint: Integrated Marketing, Measurement, and Alignment Strategic Action Plan for Residential Rate Reform and TOU_V2. Greenberg, Inc. August 19, p RROIR MEO Blueprint: Integrated Marketing, Measurement, and Alignment Strategic Action Plan for Residential Rate Reform and TOU_V2. Greenberg, Inc. August 19, p The Greenberg Blueprint identifies rate mechanics as the rates, structures, rate windows, etc. p RROIR MEO Blueprint: Integrated Marketing, Measurement, and Alignment Strategic Action Plan for Residential Rate Reform and TOU_V2. Greenberg, Inc. August 19, p RROIR MEO Blueprint: Integrated Marketing, Measurement, and Alignment Strategic Action Plan for Residential Rate Reform and TOU_V2. Greenberg, Inc. August 19, p

20 formal commitments regarding Community Choice Aggregator (CCA) participation. Any of these factors could necessitate future modifications to the plan and budget. PG&E reserves the right to amend its plan as decisions are made and TOU Pilots data become available. As PG&E proceeds with its proposed test and learn approach, additional adjustments may be warranted to support a more successful Residential Rate Reform transition. For the reasons set forth in the chapters below, PG&E respectfully requests that the CPUC grant approval, in early 2017, of this Residential Rate Reform ME&O plan, and provide a mechanism for making future adjustments to the adopted plan as more is known. II. Regulatory Background and Objectives A. Regulatory Background California has long been and remains at the forefront of innovative energy policy development and implementation. As articulated throughout Rulemaking (the Residential Rate Reform Order Instituted Rulemaking, or RROIR), the Commission and the State have developed energy policies geared towards achieving a more environmentally sustainable California. Additionally, clean energy technology (e.g., rooftop solar) innovation and adoption have increased significantly in recent years. While policy and technology are rapidly changing, residential electricity rate structures have remained largely unchanged. In 2013, upon the enactment of Assembly Bill 327 (AB 327), many restrictions on residential rate design were lifted, permitting new rate structures. The CPUC implemented this law through Rulemaking , setting forth various Residential Rate Reform milestones. Commission D ordered, among other things, consolidation and flattening multiple rate tiers, revisions to the Minimum Bill, improved bill comparison tools and educational materials, implementation of TOU pilots, and effective ME&O to help customers better understand and respond appropriately to the price signals in their electricity rates. -6-

21 D also recommended that default TOU begin with a mild price differential between on-peak and off-peak rates, which the CPUC called a TOU-Lite rate. 13 PG&E s proposed default TOU rate design will align with this guidance. In addition, D identified the need for targeted ME&O for two groups of customers that will be highly affected by Residential Rate Reform: low usage customers and high usage customers who use more than 400% of baseline quantities of electricity. D also required the IOUs to form a ME&O WG, which would specifically address the program to promote low-cost and no-cost energy efficiency options for current Tier 1 and Tier 2 customers, as well as long-term residential outreach. 14 On December 17, 2015, the CPUC issued an Assigned Commissioner and ALJ Ruling, which further clarified ME&O requirements for Residential Rate Reform: directed the IOUs to (1) hire a consultant to advise the ME&O WG on appropriate ME&O metrics, goals and strategies for meeting those goals and (2) prepare a comprehensive ME&O plan with strategies for implementing Residential Rate Reform. 15 The December 2015 Ruling set forth objectives for the ME&O consultant to deliver: (1) metrics with goals and targets, (2) a strategic action plan for IOUs to achieve said targets, and (3) a plan for Statewide ME&O program coordination. A Request for Proposal process was conducted during the first quarter of Afterwards, the ME&O WG, under the leadership of the CPUC s Energy Division, selected Greenberg as the ME&O consultant. From May through August of 2016, members of the ME&O WG met with Greenberg, via in-person meetings, in-depth 13 The CPUC stated: The purpose of this mild differential [between peak and off-peak prices] is to be an introductory rate that allows customers to learn and understand the new [TOU] rate structure before they are subject to differentials that could produce significant rate shock for the unaware. During the TOU-Lite transition period, we would expect to see less load-shifting than we would with more fully cost-based price differentials [D]uring the transition, it is more important to ensure customer acceptance of the new rate structure and understanding of the directional price signal. The TOU-Lite structure will be more acceptable to customers, less volatile, and avoid[s] other potential issues. The shift toward more fully cost-based price differentials may be made later, informed by data and experience gathered during the course of pilot implementation and ongoing review of the glidepath transition. (D , mimeo, pp ) 14 D , mimeo, p. 336, Ordering Paragraph (OP) The December 2015 ALJ Ruling directed the IOUs to file their respective ME&O plans by September 1, On May 26, 2016, an ALJ Ruling was issued extending the due date for the ME&O plans to be the earlier of the due date for the Energy Efficiency Business Plans or November 1,

22 interviews, numerous conference calls, and online focus groups, providing content review and feedback on Greenberg s deliverable. On August 20, 2016, Greenberg released its ME&O Blueprint, 16 detailing a recommended strategic action plan for statewide and local utility marketing. The Greenberg Blueprint proposed a vision, metrics for Residential Rate Reform, and a ME&O implementation plan, in preparation for 2019 default TOU rates. On September 12, 2016, PG&E, along with several other stakeholders, participated in a CPUC sponsored ME&O workshop, to quickly and efficiently determine the role of the Greenberg Blueprint. During the workshop, parties commented on the Greenberg Blueprint within a framework of five areas: (1) things that seem reasonable and should inform the IOUs plans, (2) things that are necessary to the IOUs plans, but are not in the Greenberg Blueprint, (3) things that could be done by action at the Commission level, but not as part of the RROIR proceeding, (4) things that cannot be included in the plans, and (5) things that raise concerns. 17 In addition to the direction on ME&O, on July 22, 2016, an ALJ Ruling 18 was issued which (1) adopted guidelines for the bill comparisons reports, (2) directed the IOUs to conduct research to determine whether bill comparison reports have an impact on customer awareness and understanding of rate options, and (3) directed IOU development of a plan for engaging with customers to help them understand their rate options when they establish or re-establish service. These activities are discussed within their respective sections of this ME&O plan. B. Regulatory Risks While the IOUs have received significant regulatory guidance on ME&O for Residential Rate Reform and have developed ME&O plans based on this guidance, the RROIR Proceeding remains open. Many ongoing activities associated with the RROIR may further impact PG&E s ME&O plan and require the strategies and budgets to be revised. Ongoing activities in this proceeding include, but are not limited to: 16 ALJ McKinney issued a Ruling on October 7, 2016 adding Greenberg s Marketing, Education & Outreach Blueprint v.2 (MEO Blueprint) into the record for R for reference purposes. PG&E will continue to reference the MEO Blueprint going forward. For a copy of the report, please see the link provided in the ALJ s Ruling. 17 August 29, 2016 ALJ Ruling. 18 July 22, 2016 ALJ Ruling Regarding Bill Comparisons and Directing Utilities to Develop Plans for Engaging New Customers, p. 9. The requirements for bill comparison set forth in the July 22, 2016 ALJ Ruling were later affirmed in D

23 1. Public Utilities Code (Pub. Util. Code) Section 745 Outstanding issues including whether the TOU pilots show any additional groups of customers may experience unreasonable hardship under default TOU, such that the CPUC might decide to exclude some customers from default, revise the rate, and/or require special outreach to such customers. Resolution of such open items may require changes to this ME&O plan, including changing the numbers of customers to be defaulted to TOU, or to the timing extent or type of communication with them. 2. Participation of CCA customers in default TOU CCAs are not under the CPUC s ratemaking jurisdiction, thus the CPUC cannot require them to participate in default TOU. While most of the current CCAs have indicated they intend to participate, it is possible that CCAs may deviate from PG&E s default TOU plans. In addition, as new CCA s begin, they may decide not to participate in default TOU or to deviate from PG&E s plans. 3. Ongoing Opt-In TOU Pilot PG&E s Opt-In TOU Pilot will generate lessons learned, which will inform best practices and implementation planning. Because the Opt-In TOU Pilot is currently planned to conclude at the end of 2017, with a final evaluation report to be released in March of 2018, complete learnings are not yet available. The results of these learnings may lead to changes in the default TOU implementation plan, including ME&O activities. 4. Default TOU Pilot PG&E will be filing its plan for its Default TOU Pilot on December 16, As with the Opt-In TOU Pilot, PG&E anticipates the Default TOU Pilot will generate lessons learned, which may impact PG&E s ME&O approach. Early learnings (such as operational and initial messaging surveys) are anticipated to be available in Summer 2018, with complete learnings no earlier than Fall These learnings may lead to changes in the default TOU implementation plan, including ME&O. 5. Default TOU It has not yet been decided what PG&E s proposed 19 default TOU rate will be, nor is it known what the CPUC s ultimately approved default TOU rate design will be. In addition, it is uncertain what will be adopted as the final default TOU implementation plan. For example, it is unknown when the CPUC will vote out its final decision on PG&E s 2018 RDW s default TOU proposals. Issuance of a final decision after November 2018 would affect when default TOU is actually launched in 2019 and thus the ultimate, duration of default TOU implementation. Again such future CPUC decisions may include changes to PG&E s proposal, including this ME&O plan. 6. Timing of ME&O Plan Approval Significant delays in approving PG&E s ME&O plan, beyond early 2017, may require PG&E to adjust its proposed ME&O plan. Nevertheless, PG&E presents its ME&O plan, which is designated to support customers as they transition through Residential Rate Reform, including the transition to default TOU rates. PG&E s ME&O plan focuses on educating customers and providing 19 D , OP 9 directs PG&E to file a RDW application no later than January 1, 2018, proposing a default TOU rate for residential customers, among other things. -9-

24 them with choice and control, which should lead to increased customer awareness, understanding and ultimately engagement among customers regarding their rate options, choosing the right rate plan for them, and what energy management solutions such as tips, tools, and programs they can use to better manage their use, and ultimately their bill. C. Objectives PG&E supports changes in the way residential customers are charged for their electricity. As the Commission notes in its Order Instituting Rulemaking for Residential Rate Reform, energy industry changes have an impact on utility operations, utility costs, how the utility recovers those costs, and ultimately, the rate itself. As the state moves to a cleaner resource mix, rates must be established that allow the utility to recover the costs related to these programs in an equitable manner. 20 In order to address the changing energy landscape, PG&E has identified the following long-term objectives for implementing Residential Rate Reform: Simplify the rates and provide more customer choice to enhance the customer experience. Modify the way PG&E charges customers for their energy to better reflect the cost to serve. Provide price signals, tools and information that better incent and empower customers to efficiently manage their energy use. PG&E has identified the following objectives for implementation of default TOU rates beginning in 2019: Customers have support and easy access to timely effective information in their transition to default TOU. Customers understand TOU rate changes and are aware they have rate choices. A clearly articulated plan is implemented to effectively and efficiently transition the business operations and processes in time to support a successful launch of default TOU. 20 Order Instituting Rulemaking on the Commission s Own Motion to Conduct a Comprehensive Examination of Investor-Owned Electric Utilities Residential Rate Structures, the Transition to Time Varying and Dynamic Rates, and Other Statutory Obligations, Issued June 28, 2012, p

25 Risks associated with default TOU are identified and mitigated for items such as customer satisfaction, customer engagement and PG&E resources and costs. To achieve these objectives, it is important to effectively educate customers about rate options and energy management and provide them tools to help make the transition to default TOU rates a success. As the Commission has repeatedly noted, it is important to provide adequate marketing, education and outreach to customers so that they can understand and respond appropriately to their electricity rates. 21 Among the rate design principles adopted in this rulemaking, are two principles that highlight the need for customer understanding and choice: Principle 6: Rates should be stable and understandable and provide customer choice. Principle 10: Transitions to new rate structures should emphasize customer education and outreach that enhances customer understanding and acceptance of new rates, and minimizes and appropriately considers the bill impacts associated with such transitions. 22 Finally, PG&E believes that management of overall costs must be a key consideration in determining what marketing solutions should be adopted by the CPUC, and has sought to balance affordability while achieving the stated objectives. III. Market and Situation Overview PG&E s service territory is unique with a highly diverse population, a broad base of industries, and an equally varied climate and topography. Financial, political, religious, and ethnic and lifestyle differences vary greatly among the residential customers across PG&E s four core regions (the Bay Area, Central Coast, Central Valley, and Northern Regions). In addition, PG&E s service territory encompasses a wide range of geographies and climates, including temperate coastal regions, warm inland valleys, hot desert climates, expansive mountainous terrain, bays and peninsulas, and other distinct geographic and climactic features. 23 The diversity encompasses various language barriers and specialized needs, and necessitates communications to be carefully developed and targeted for specific customer segments. 21 D , mimeo, p D , mimeo, p

26 Of the over five million residential customers in PG&E s service territory, close to two-thirds (63%) are dual-commodity (i.e., taking both natural gas and electric service from PG&E). Single-commodity residents are comprised of 22% electric only and 15% gas only. The greatest concentrations of residential customers are around the San Francisco-Oakland-San Jose area and the Central Valley, from Sacramento to Bakersfield, which is a mix of temperate and non-temperate climates. The distribution of residential customers has held steady for several years, with only modest shifts in ethnic make-up and population growth. The distribution of PG&E s residential customers across the f regions within PG&E s service territory, which have not changed from 2015 to 2016, are presented below: Residential Customer Distribution Region Counties % in 2016 Bay Area Marin, Napa, Contra Costa, N. Alameda and San Francisco 22% Central Coast Central Valley Northern Santa Clara, S. Alameda, San Mateo, Santa Cruz, Monterey, San Benito, San Luis Obispo, Santa Barbara San Joaquin, Calaveras, Amador, Alpine, Stanislaus, Tuolumne, Mariposa, Merced, Madera, Fresno, Kings, Kern Sonoma, Lake, Mendocino, Humboldt, Shasta, Tehama, Glenn, Lassen, Plumas, Butte, Colusa, Sutter, Yolo, Solano, Sacramento, Placer, Yuba, Nevada, Sierra, El Dorado 30% 21% 27% Approximately 74% 24 of PG&E s residential customers live in detached dwellings and 28% in shared homes, such as apartments, condos or townhouses down from 31% in The percentage of homeowners grew modestly from 61% in 2015 to 63% in While 55% of PG&E s residential customers have lived in their homes for six years or more, at the other end of the spectrum just 4% have lived in their current home for less than a year. The majority of homes were built from 1950 to 1974 (18%), 26 with fewer built in 2005 or later (4%). This indicates lower residential new construction activity in recent times, and people within the PG&E territory moving into existing homes. 24 Demographic data source: Acxiom July Note that some customers have multiple homes. 26 Demographic data source: Acxiom July

27 The household composition of residential customers has remained relatively stable in recent years. The ethnic make-up is split by African American (3%), Asian (11%), Hispanic (21%) and others including Caucasian (58%). Most households (70%) have one to three residing adults. In terms of language preference, according to available third-party data, about 77% prefer English, 15% prefer Spanish, 2% Chinese, and 2% Hindi communications. This is a small shift from Spanish to English from the prior year (1%). Twenty-eight percent of PG&E s households have one adult (up from 21% in 2014), while 30% of households have two adults, the same as in Thirty-two percent of PG&E s residential customers have a person under 18 living in the household. This indicates growth in one-adult households, which could be the result of aging into the 18 to 24 group (young adults leaving parental homes and setting up on their own residence) and also the growing 65+ age group. Personal income levels have remained unchanged over the past two years, with 28% of customers having a household income of less than $50,000, 41% from $50,000-$99,000, and 31% earn over $100,000. In terms of education, 46% graduated from high school, 36% graduated from college, and 17% completed graduate school. There is a fairly even distribution of ages, with a slightly higher concentration of mature customers. Seniors, defined as age 65 or over, make up about 27% of PG&E s residential customer population, and this segment is growing as the population ages. Other customer age bands include 14% of customers aged 18 to 34, 37% aged 35 to 54 years old, and 22% aged between 55 and 64 years old. In terms of current rate plans, the vast majority of PG&E s residential customers are on a tiered rate: 95% residential customers are on PG&E Schedules E-1 and EL-1 (standard tiered rate and its Californians for Renewable Energy (CARE) counterpart, respectively), with fewer than 4% on an existing voluntary TOU rate, and 0.5% on an Electric Vehicle rate. The past 12 months of usage data indicates that the majority of PG&E s customers electricity usage reached Tier 3, with 80% whose usage exceeded Tier 3. This is compared to 12.1% whose usage never exceeded Tier 1 (the baseline quantity) in the past 12 months, with the balance of 7.1% only reaching Tier 2 (and no higher) during the same period. High usage customers, defined as those reaching at least 400% baseline or above during the last 12 months, comprise approximately 7% of PG&E s total residential electric customer base. -13-

28 A. Customer Engagement and Program Enrollment Customers use a variety of methods and solutions for engaging with PG&E. When it comes to managing their bill, just over half of residential customers have used some form of electronic payment (57%), including electronic funds transfer or auto-pay. Just 4% of customers are currently enrolled in the Balanced Payment Program. Forty-three percent of residential customers have provided their address to PG&E (an increase from 42% in 2015). Other forms of payment include the use of the interactive voice response system with PG&E s 800 number. Thirty-six percent have used this service over the past year. Approximately 3% of PG&E s residential customers are enrolled in the SmartAC Program (nearly 147,000 customers), while 3% are enrolled in PG&E s SmartRate (residential critical peak pricing program, with approximately 142,286 enrolled customers). Twenty-six percent of all PG&E residential customers are enrolled in the CARE Program. Residential customer participation in energy efficiency rebate programs has recently been consistent year over year, with 21% of residential customers redeeming a rebate in Over half of that (about 11% of customers) received an appliance rebate, and another 3% received a rebate for improvements to their home s HVAC system. Program Program Participation by PG&E Customers 2016 Percentage of Customers Percentage of Customers 2014 Percentage of Customers Online Account 52% 43% 43% CARE 26% 26% 26% SmartRate 3% 2% 2% SmartAC 3% 3% 3% Net Energy Metering (NEM) for solar customers 5% 3% 2% Rebate participation 21% 21% 19% B. Energy Efficiency Opportunity Score PG&E maintains for each customer an Energy Efficiency Opportunity Score. This is a modeled score applied to customers based on their energy savings opportunity as compared with their peers. If the customer is less efficient than others that have similar usage profiles then there is a larger opportunity to improve their energy efficiency Program participation percentages current as of July

29 PG&E has used Energy Efficiency Opportunity Score scores to characterize customers who appear to have an opportunity to save energy, and target them for appropriate communications. Customers are grouped together that look alike and a norm is determined for that group given that group s overall usage. Then each customer s actual usage is compared to that norm. The difference becomes the degree to which they are efficient or inefficient. There are 10 peer groups and each one is broken into five quintiles showing the least to the most efficient. The Energy Efficiency Opportunity Score has been used in conjunction with PG&E s product propensity scores to identify customers with both an inclination to PG&E s products, plus a greater amount of energy to save. Energy Efficiency Opportunity Scores of PG&E Customers 28 Quintile* # Customers Missing Score** 795, , , , , ,288 * (1 = inefficient; 5 = efficient) **Not yet scored C. PG&E Residential Customer Personas PG&E s Customer Analytics and Segmentation database categorizes all residential customers into one of 11 psychographic segments called personas. Eight of these personas apply to all-electric or dual-commodity customers, and three Geo-Centric personas apply to PG&E s gas-only customers. Each PG&E customer has a persona designation, and by creating groups of similar customers, PG&E is able to overlay additional data such as psychographics, life stage, income, media usage, and attitudes, which are not widely available at the customer level. Personas can help guide PG&E in how to communicate with each type of customer, what motivates them and the right kind of language to use to encourage engagement. The largest persona segments include Eco-Active Go-Getters (18%) and the Way Wired segment (18%). The next two largest groups are Heart and Home (14%) and Living for Today (10%). The number of customers in Living for Today and Stable Living persona segments has been 28 Data as of July

30 declining since 2014, while the Way Wired persona segment has been growing as technology innovation has become more mainstream. The table below summarizes the distribution of PG&E s persona segments, with the corresponding key characteristics of each. -16-

31 Persona Segment Name Customer % Way Wired 18% Eco-Active Go Getter Heart and Home Living for Today 18% 14% 9% Stable Living 9% Geo-Centric Digitals 9% Gadget Family 7% Beyond Their Means 5% Style Seeker 5% Geo-Centric Discounters Geo-Centric Basics 4% 2% PG&E Residential Customer Persona 29 Brief Description Likely to have higher income, white collar occupations Live in higher value homes Primarily live in temperate areas such as San Jose, San Francisco and East Bay Likely to be concentrated in the San Francisco area Mix of renters and homeowners, with few children and wide ranges of income Tend to skew Asian Likely to be low to middle income with smaller, older homes Higher concentration of Hispanics Skew older Likely to be younger Frequent movers and low to middle income More likely to be Hispanics, mix of renters and home owners Likely to be on CARE Primarily renters, middle aged or older High rate of recent movers, lower income and Spanish - speaking Likely to be younger, high online engagement ( , e-pay, online account) Gas only customers Primarily homeowners with moderate incomes Longer term customers who are likely higher income, homeowners Married with children Likely to live in East Bay, San Jose and North Coast Likely to be middle aged or older Homeowners with lower income Have higher energy requirements because of older / larger homes Likely to be renters in the Bay area Younger, recent movers Ethnically diverse and lower to middle income Likely to be cost conscious Offline and gas only customers Likely to be settled in life, typically aged 45+ with a long tenure Lower income, often on CARE Have basic relationship with PG&E Likely to have higher incomes Likely to have lived in their home for less than a year 29 Sources for PG&E Residential Customer Segments include: PG&E s Customer Analytics and Segmentation [CAS] database (containing PG&E customer data, Acxiom, Personicx, Geoscape and Simmons). -17-

32 D. Customers Media Consumption When it comes to media consumption, the diversity of PG&E s residential customer base requires recognition of the different ways customers use media. For example, a 25 to 34 year old Millennial uses media very differently than those age 65+. Millennials are more digitally-driven than older segments. Millennials grew up with digital devices, social networks, video-on-demand, YouTube, Hulu, etc. and are in the habit of controlling and curating content. Their media usage habits reflect those roots and, to effectively reach them, planning must include digital. Fifty percent are lighter television viewers, 30 choosing to watch shows on their mobile devices. Twenty-nine percent watch TV shows online, while 35% watch movies online. Millennials are medium to heavy radio users, where 44% fall into the two heaviest user groups/quintiles and listen via Internet/app or listen to satellite radio. The Internet is integral to Millennial customers daily life. Fifty-five percent fall into the two heaviest user groups/quintiles, and 56% get their news online and stay socially connected through Facebook (79%), Instagram (35%), Pinterest (27%) and YouTube (69%). The 35 to 64 (Mid-Life) segment engages with both digital and traditional offline media. 31 Their busy lifestyles (working, raising kids and maintaining a home) limits their available time, so they are selective media users. As full a mix of media radio, digital, and print as is reasonably affordable, can effectively reach this demographic. 30 Sources for media points above include MRI 2016 Doublebase Study: Media Quintile Analysis for A25-34, A35-64, A65+; Nielsen, The Cross Platform Report March 2014; MRI 2016 Doublebase Study: Activities done on the Internet in last 30 days A25-34, A35-64, A65+; MRI 2016 Doublebase Study: Radio listening Internet/Satellite; Total Audience; MRI Doublebase Study: Websites Visited in the Last 30 Days A25-34, A35-64, A Sources for all media information cited above include MRI 2016 Doublebase Study: Media Quintile Analysis for A25-34, A35-64, A65+; Nielsen, The Cross Platform Report March 2014; MRI 2016 Doublebase Study: Activities done on the Internet in last 30 days A25-34, A35-64, A65+; MRI 2016 Doublebase Study: Radio listening Internet/Satellite; Total Audience; MRI Doublebase Study: Websites Visited in the Last 30 Days A25-34, A35-64, A65+; MRI Doublebase Study: Cable, Satellite & Fiber Optic TV; Household Subscription; MRI Doublebase Study: Radio Networks Terrestrial Listening; Total Audience. -18-

33 Mid-Life customers listen to broadcast radio (AM/FM, NPR) as well as satellite radio while commuting to and from work. They are average newspaper readers and 50% also rely on online news sources. The Internet keeps them connected, helps them manage their hectic lives, and enables them to obtain financial information, real estate and medical information, book personal and business travel, look for recipes and keep up with current events. Mid-Life customers receive good exposure to out-of-home media as they are out and about daily, commuting to work, picking up kids from activities, shopping, and running errands. They are lighter, selective TV watchers. Primetime viewing is the highest viewing time of day (either together with their family or through separate, parallel coviewing). Of Mid-Life households, 45% subscribe to cable and 28% to satellite TV. Within satellite in particular, Mid-Life households subscribe to Dish (11.5%) or DirectTV (16.4%) at a higher propensity than average U.S. adults, or the other PG&E age segments. Mid-Life customers use of social media is average and growing they stay connected to keep tabs on their children, friends and family (Facebook 60%, Instagram 14%, Pinterest 19%); and to stay business-relevant (LinkedIn 15%). Those 65 years and older (Seniors) rely heavily on traditional offline media and much less on Internet or social media. If they do use online or social media, their time and frequency of use are very limited. Radio and print will play a significant role in reaching this audience. Seniors prefer AM radio, NPR and are average listeners of satellite radio (Sirius 12%). Newspapers are their most relied upon news source 58% fall into the two heaviest newspaper user groups/quintiles. They use the Internet, but 69% fall into the two lightest user groups/quintiles. Seniors are heavy users of television, all day, every day with daytime and primetime viewing. -19-

34 There is less potential exposure to out-of-home media as they are less active, less out and about regularly than their 35 to 64 year-old (Mid-Life customer) counterparts. In terms of social media, Facebook sees the widest Senior usage (29%), with limited use of other networks like Instagram (2%), Pinterest (6%), LinkedIn (5%), and Twitter (2%). Media usage research can provide directional data to inform the diversity of media mixes for developing an effective ME&O plan. Some research highlights: Hispanic and African American targets have strong radio usage, placing them into the top/heaviest user quintiles. 32 Community newspapers provide the ability to carry unique language creative and reach into the community. While Asian media usage ranks high for Internet, print and radio can also be utilized to further extend reach into local Asian communities. E. Customers Relationship With Energy Research indicates that energy (electricity) is a low involvement category from a residential customer perspective. Accenture 33 reports that customers spend no more than twenty minutes per year, or less than two minutes every month, interacting with their electricity provider, and that traditionally, consumers and their utility have not had a high value relationship. Gallup 34 points out that 65% of people would oppose regulations on how much energy people can use in their homes, which indicates that many customers have a sense of entitlement when it comes to their approach to energy use. PG&E s research studies 35 show that despite some customer segments being more involved with energy (e.g., Net Energy Metering (NEM) customers), most customers don t want to spend any more time thinking about their energy use than they 32 Source for diversity segment media: MRI 2016 Doublebase Study: Media Quintile Analysis for Spanish Spoken Most Often; Spanish, Hispanic Origin or Descent; Black/African American, Asian. 33 Actionable Insights for the New Energy Consumer, Accenture Gallup Poll March, New Product Development: An Ethnographic Approach, Greenberg Inc., 2008; Residential Rate Reform Focus Group Report, Hiner & Partners, 2014; Rate Analyzer Study, Hiner & Partners, January

35 have to. In short, there is little evidence that consumers feel personally responsible when it comes to energy use, and that their relationship with electricity and their energy utility is largely transactional. They are focused on the payment of their bill, indicating that they may have little reason to care other than monetary benefit. It is this lack of customer relationship with their electricity, and lack of emotional involvement (or EQ) that the Greenberg Blueprint identifies as among the biggest challenges for developing effective customer communications to support as successful a transition to residential default TOU as possible. PG&E studies over recent years 36 have clearly shown that, when it comes to energy, customers want choice and control. However, many customers do not always feel that they have choice and control over their bill. Residential customers have stated that they often feel powerless when it comes to lowering their electricity bill. Over half (53%) agree that they actively manage energy use as many ways as possible in terms of trying to lower their energy bill, and 40% of customers state that they had taken actions to save, but felt there is not much more that can be done to lower their bill. Because the vast majority of PG&E residential customers are interested in lowering their energy costs, Rate Reform presents an opportunity for PG&E to empower its residential customers with education and ways to take more control and manage their bills. This need for customer control extends to customers feelings towards rate plans and what they want from their rate. F. Rate Understanding: What Customers Want from a Rate and Rate Communications Despite significant and continued communications, rate plans appear to remain a mystery to many customers. Qualitative research indicates that some customers are unaware that they are on a rate plan per se. Current levels of customer confusion are considerable. Specifically, customers do not understand very well the rate tiers on Schedules E-1 and EL-1. PG&E s baseline ME&O tracking survey 37 shows that 49% of PG&E s residential customers are not sure which rate plan they currently have for their home; 11% of customers think they are on a TOU rate plan (when approximately only 4% actually are); and just 39% think they are on a tiered rate plan (when approximately 36 New Product Development: An Ethnographic Approach, Greenberg Inc., 2008; Residential Rate Reform Focus Group Report, Hiner & Partners, 2014; RROIR Customer Survey, Hiner & Partners, Rate Reform ME&O Tracking Survey Report, Hiner & Partners, March

36 95% actually are). Just over half of all PG&E residential customers (55%) have heard of a TOU rate. Still, 74% customers have tried to save money by shifting their energy use, 38 indicating that time shifting is already a familiar concept to many customers, that was probably learned through past outreach around Flex Your Power. It is important to note that with so many customers claiming they have time shifted usage at some point, this may have contributed to customer feelings of confusion regarding their bills when such activities show no benefit to their bills due to their monthly, tiered rate structure. The same study shows that two-thirds of residential customers rate saving money as the main required attribute of a rate plan, with all other attributes, such as stable (32%), simple (30%) and predictable (29%), being rated secondary. These desired rate attributes are reinforced in PG&E s qualitative research, which also emphasizes that customers want a choice of rate plan one that best suits their usage and lifestyle needs, and that better allows them to control their bill. When it comes to communications, customers want transparency 39 and simplicity. Rates need to be communicated in a straightforward, matter-of-fact manner. Customers do not want to be overwhelmed with detailed explanations of rates, but instead be given a clear description of how the rate influences their bill. Since customers already feel that rates are complex and confusing, they simply wish to know what does this rate change mean for me? PG&E s communications must strike a balance between giving the customer what they need to know, and being careful not to overwhelm them so as not to make them disengage. The rates should also be explained in customer-friendly language as opposed to utility-speak or jargon. In fact, qualitative research indicates that, when it comes to rate communications, customers want to know: What is happening? What is the rate? What are the implications? How will it impact me in terms of my bill? What do I need to do (what actions do I need to take) to be successful on the rate? How will PG&E help? However, customers can be predisposed to be suspicious of rate communications from PG&E. 40 Qualitative research shows that many customers assume any 38 RROIR Customer Survey, Hiner & Partners, Rate Change Communications Qualitative Study, Hiner & Partners, Rate Change Communications Qualitative Study, Hiner & Partners,

37 communication about their rate is informing them of a rate increase, and that any change of rate may hide a rate hike. With regard to a TOU rate, 55% of residential customers claim to have heard of TOU according to the ME&O Tracking Survey. 41 When customers are exposed to the idea of the updated, evening peak period with higher peak rates, many customers initially view it negatively and see an evening peak as increasing the risk of a possible negative impact on their bill. 42 In the rate comparison study 43 of customers exposed to a structural benefiter scenario, many customers viewed switching as a risk, and felt that remaining on their current rate was the most comfortable option for them. However, perceived risk is likely to be mitigated by customers being made aware that they have choices, and of their projected level of bill impacts under each of these choices. Knowing that one has a choice of rates is an important component of a positive customer experience. While PG&E s residential customers clearly want a choice of rate plans and the ability to select the one that best fits their needs, most customers (62%) 44 are currently unaware that they have a choice. Recent PG&E Customer Voice Panel research 45 on Rate Reform creative concepts shows that customers appreciate rate choice messaging. Overall, the messaging tested in creative concepts appeared to increase favorability among nearly one-third of PG&E s residential customers in the study. According to open-ended questions in surveys, customers often received messaging around rate changes negatively. However messaging around choices and rate options was able to counter this effect and produce a positive customer response. G. Default TOU Segmentation Strategy Customer segmentation can be an important strategy, where appropriate, to enable PG&E to provide relevant rate information and actions in certain of its customer communications. Generally, PG&E agrees with the segmentation principles in the Greenberg Blueprint. Accordingly, PG&E is beginning to construct a new impact-based segmentation approach that primarily will be derived from summer bill impact data. The final approved default rate and the CPUC s ultimate resolution of such issues as 41 Rate Reform ME&O Tracking Survey Report. Hiner & Partners, March May 2016; TOU Pilot Communications Optimization Study, February Rate Reform Communications Focus Groups, King Brown & Partners, May Rate Reform ME&O Tracking Survey Report. Hiner & Partners, March Rate Reform Umbrella Marketing Test, PG&E Customer Voice Panel; June

38 whether there will be any additional customer exclusions per Pub. Util. Code Section 745(c)(2), will be needed to guide PG&E s final approach to segmentation. PG&E currently assumes its impact-based segmentation will likely consist of Benefiters (customers who will certainly save on default TOU), Neutrals (customers likely to have negligible bill impacts on default TOU), and Non-Benefiters (customers likely to see bill increases under default TOU if they make no changes in behavior). In contrast with the Greenberg Blueprint, Non-Benefiters may be further segmented into just two micro segments: Mild Non-Benefiters and Extreme Non-Benefiters. PG&E does not believe that the five microsegments recommended in the Greenberg Blueprint are necessary given the mild price differentials in the default TOU rate. Another consideration when assessing bill impacts will be energy burden, defined as the level of energy cost relative to household income, as well as bill volatility; both these factors will be incorporated into any impact model. Secondarily, customers may be segmented based on their geography, in-language dependence, and program participation, age or designation as low income. Additional considerations will be made for segmentation leveraging psychographics/persona groupings and load profiles, such as large electric usage during peak hours. These added segmentation layers might change during various stages (pre/post default). Also, the attributes included and the final segmentation approach will be carefully considered to ensure there is sufficient value from a messaging perspective to warrant the extra cost and complexity associated with additional versioning. The segmentation approach will be tested in the Default TOU Pilot and finalized prior to the 2019 default to TOU rates. IV. Product Profiles and Evolution In Phase 1 of the Commission s RROIR, the Commission in July 2015 issued D (Phase 1). That Phase 1 Decision directed PG&E to make a number of changes to residential tiered rates, primarily reducing the number of tiers and narrowing the rate differentials between tiers over a transition period from 2015 through The purpose of this section is to review the Rate Reform-related changes to PG&E s residential rates that have taken place since that decision in July These include changes related to: (a) PG&E s Standard Tiered Rate, Schedule E-1; (b) PG&E s pre-existing residential TOU rates, Schedules E-6 and E-7; (c) PG&E s newly introduced TOU rates, Schedules ETOU-A and ETOU-B; and (d) PG&E s Opt-In TOU Pilot project rates, Schedule ETOUPP. Finally, this section summarizes similar changes made to the CARE versions of these rate schedules available to qualifying low income -24-

39 households, as well as changes to residential rates related to Family Electric Rate Assistance (FERA) Program, changes to rates for customers who qualify for Medical Baseline allowances, and changes to the Minimum Bill amount charged to customers with little or no usage in any given month. A. Standard Tiered Rates The Phase 1 Decision implemented a glidepath for standard tiered rates over the transition period from 2015 through Specifically, once per year, PG&E was directed to collapse (i.e., combine), particular tiers and/or modify the ratios between the rates in the various tiers to hit Commission specified rate ratio targets in each year. The Commission s objective was for PG&E to eventually reach, in the last year of the glidepath period, a rate structure with two tiers plus a High Usage Surcharge tier, where the ratio of the Tier 2 to the Tier 1 rates would ultimately be 1.25, and the ratio of the High Usage Surcharge tier rate to the Tier 1 rate would be However, the Phase 1 Decision also specified a cap on the degree to which the Tier 1 rate could increase versus its value twelve months prior. Specifically, when tiers are collapsing, the percentage increase in the Tier 1 rate was to be capped at the corresponding percentage increase in the residential class average rate plus 5%. The Phase 1 Decision directed that the first step on the glidepath was to take place shortly after the decision was issued in July This first step continued the four-tier rate structure already in effect, but specified target tier rate ratios that would narrow the gap between the top (Tier 4) and bottom (Tier 1) rates. Specifically, the target rate ratios for 2015 were as follows: Tier 2: Tier 1 = 1.18 Tier 3: Tier 1 = 1.5 Tier 4: Tier 1 = 1.91 On September 1, 2015, PG&E implemented this narrowing of its Schedule E-1 rates and was able to set rates whose ratios exactly matched the targeted ratios above. Per the Phase 1 Decision, the second step in the glidepath called for the number of tiers to be reduced from four to three in This was to be achieved by collapsing the then current Tier 2 (usage between 100% and 130% of baseline) and Tier 3 (usage between 130% and 200% of baseline), into a single new Tier 2 that corresponded to customer usage between 100% and 200% of baseline. In addition, the 2016 glidepath target rate ratios between the resulting rates were set as follows: -25-

40 Tier 2: Tier 1 = 1.23 Tier 3: Tier 1 = 1.81 However, because the Tier 1 rate cap was reached in 2016, it was mathematically impossible for PG&E to set rates to achieve these two target rate ratios. As a result, the Commission ultimately approved PG&E rates that had the following rate ratios (both of which were higher than the target ratios): Tier 2: Tier 1 = 1.31 Tier 3: Tier 1 = 2.18 These rates were implemented on June 1, In June and July of 2016, customers temporarily continued to see four tiers on their energy statement, with Tiers 2 and 3 showing the same rate value. By August 2016, billing system programming was completed so as to allow customers energy statements to display three tiers. B. Pre-Existing Optional TOU Rates Standard Tiered Rates At the time of the Phase 1 Decision in July 2015, PG&E was already providing service on two separate residential voluntary TOU rates, Schedules E-7 and E-6. Schedule E-7, PG&E s original TOU rate for residential customers, was a hybrid tiered TOU rate with two TOU periods in both summer and winter, and a peak period on weekdays from Noon to 6 p.m. At the time of the RROIR Phase 1 decision, Schedule E-7 had been closed to new customers for about seven years. In its RROIR testimony, PG&E proposed that Schedule E-7 be eliminated and the Phase 1 Decision granted this request. Schedule E-7 was initially scheduled to be eliminated in March 2016, concurrent with the introduction of PG&E s new optional TOU rates, Schedules ETOU-A and ETOU-B (described in the following section), but due to problems with notifying affected customers, the CPUC extended the elimination date to May 31, As of August 1, 2016 no customers remained on the E-7 rate and all former E-7 customers were receiving service under one of the other available rates. Schedule E-6 was adopted in 2007 as PG&E s voluntary TOU rate effective when Schedule E-7 was closed to new customers. Schedule E-6 is also a hybrid tiered TOU rate, but it has three TOU periods in summer and two in winter, with a summer peak period on weekdays from 1 p.m. to 7 p.m. In its RROIR testimony, PG&E proposed that Schedule E-6 be closed to new customers and replaced by a new non-tiered TOU rate, Schedule ETOU. The Phase 1 Decision granted PG&E s request to close the E-6 rate to new customers. Subsequently, in PG&E s 2015 RDW proceeding, the Commission -26-

41 approved a settlement that specified that Schedule E-6 would be closed to new customers as of the date on which the new Schedule E-TOU rates became available, in early Schedule E-6 was initially scheduled to close by March 1, 2016, but for the reasons noted in the previous paragraph, the closure date was extended to May 31, As of May 31, 2016, Schedule E-6 is closed to new customers. Per the Commission s decision in PG&E s 2015 RDW, Schedule E-6 will remain open for existing customers (i.e., those who had chosen it prior to its closure) with its current summer peak period definition of 1 p.m. to 7 p.m. through 2020, but then the peak hours will move later in the day over a two-year transition period until the summer peak hours are 4 p.m. to 9 p.m. in C. Newly Introduced Voluntary TOU Rates In D in PG&E s 2015 RDW, the CPUC also approved two new optional residential TOU rate schedules with peak hours that are later in the day. The first rate, schedule ETOU-A, is a two-tiered TOU rate, with two TOU periods in both summer and winter, and a peak period on weekdays (non-holidays) from 3 p.m. to 8 p.m. (moving to a 4 p.m. to 9 p.m. peak period as of January 1, 2020). The second rate, Schedule ETOU-B, is a simpler, non-tiered TOU rate, which also has two TOU periods in both summer and winter, but includes a peak period on weekdays (non-holidays) that is an hour later, from 4 p.m. to 9 p.m. Both rates were implemented on March 1, D. Opt-In TOU Pilot Project In December 2015, in compliance with the Phase 1 Decision and after months of active participation in the TOU WG, PG&E filed Advice Letter 4764-E with a proposed rate design for its Opt-In TOU Pilot. In February 2016, the Commission issued Resolution E-4762 approving PG&E s advice letter with modifications. Three alternative sets of experimental treatment rates were approved for each of the three IOUs. Customers who were randomly selected for PG&E s Opt-In Pilot, and who agreed to participate, were placed on one of three Schedule ETOU-PP treatment rates (or, in the case of the control group, on Schedule E-1 tiered rates) starting in June The three schedule ETOU-PP rates, all of which have two tiers, are summarized below. Opt-In Pilot Rate 1 is similar in its structure to Schedule ETOU-A. Like that schedule, it has two TOU periods in both summer and winter, and its peak period hours occur on weekdays (non-holidays) from 4 p.m. to 9 p.m. -27-

42 In contrast, Opt-In Pilot Rate 2 has three TOU periods in summer and two in winter. It also differs from Opt-In Pilot Rate 1 in that its peak period hours occur on weekends and holidays as well as weekdays, and these hours are concentrated in a shorter, three-hour window lasting from 6 p.m. to 9 p.m. Finally, Opt-In Pilot Rate 3 adds a spring season to the rate structure. In both summer and winter there are two TOU periods, with the peak hours occurring on weekdays from 4 p.m. to 9 p.m. In spring, though, there are three TOU periods. The spring peak hours are the same as the other two seasons, but a spring super-off-peak period is added, from 10 a.m. to 4 p.m. on all days to reflect the lower prices expected to occur in the future during those hours in the Spring months. Using these three approved rates, the Opt-In TOU Pilot began operations on June 1, 2016 and will continue through December 31, E. Other Rate Changes This section summarizes a number of other residential rate changes that have occurred since the RROIR Phase 1 Decision in July CARE Rates Per the direction in the Phase 1 Decision, the tier definitions for CARE were similarly changed on June 1, 2016 to reflect the same tier definitions and glidepath ratios as non-care rates. In addition, the Phase 1 Decision prescribed gradually decreasing the CARE discount over a transition period, eventually reaching 35% by Consistent with this direction, PG&E on September 1, 2015 filed Advice Letter 4697-E, with a proposed glidepath for the CARE discount that gradually declines from its then-current level of 37.6% to 35.0% in Advice Letter 4697-E was approved on November 12, PG&E s CARE discount as of June 1, 2016 is 37.0%, in accordance with that approved glidepath. 2. FERA Rates The Phase 1 Decision adopted PG&E s proposal to simplify the FERA rate discount by providing a flat 12% discount on all FERA sales. PG&E implemented this in March Medical Baseline The Phase 1 Decision adopted PG&E s proposal to provide a $0.04 per kilowatt-hour discount on all usage of Medical Baseline customers that exceeds 200% of their baseline amount. PG&E implemented this in March Minimum Bill Amount The Phase 1 Decision made two changes to the Minimum Bill Amount that applies to customers with little or no usage in any given month. In Step 1, the CPUC increased PG&E s Minimum Bill Amount from $4.50 to $ PG&E implemented this Step 1 change on September 1, Second, the CPUC directed PG&E in Step 2 (after its billing system was programmed to do so) to change the methodology for calculating the Minimum Bill Amount so that it would apply only to the Delivery portion of the bill (rather than to the entire bundled bill amount). PG&E implemented Step 2 s new Minimum Delivery Bill Amount in March

43 F. High Usage Surcharge Outreach and Implementation On October 16, 2015, PG&E filed Advice Letter 4722-E for approval of what the CPUC had called the High Usage Surcharge outreach and implementation plan, as required by D Pursuant to requests from Energy Division and other stakeholders, PG&E submitted AL 4722-E-A on March 25th, This supplemental filing substantially revised and supported PG&E s original High Usage Surcharge outreach and implementation plan. On July 27, 2016, PG&E filed Supplemental Advice Letter 4722-E-B to revise PG&E s timeline for outreach, revise the name of the surcharge to appear on customer bills as the High Usage Surcharge consistent with customer focus group research, as well as incorporate changes to the monthly usage amount that would trigger outreach to customers. The Commission approved PG&E s plan by disposition letter on August 24, PG&E will implement its High Usage Surcharge outreach and implementation plans, as approved by the Commission, to educate customers who are at risk of reaching 400% of their Baseline quantity or have previously had actual usage levels above 400% of baseline on a consistent basis through the year, as well as for those who are impacted seasonally by this new surcharge, which is set to begin in early PG&E s High Usage Surcharge outreach plan will make high usage customers aware that their electricity usage is significantly above that of the typical household and encourage them to take steps to change their behavior to become better at conserving energy. The plan will target customers who reach 350% or more above baseline for at least three months during the prior twelve months. The communications will be timed to address customers who have seasonality spikes in energy usage and those that are at risk or above 400% of baseline on a more consistent basis. The communications will begin prior to the High Usage Surcharge going into effect starting in February 2017 and will continue with notifications and education materials after implementation. After continued consideration of its original plan and the unintended impact the communications may have on customers not impacted by the surcharge, PG&E filed AL 4938-E on October 12, 2016 seeking approval to modify several elements of its original outreach plan for the High Usage Surcharge. PG&E has determined not to proceed with a bill insert that would go to all customers or digital ads. In addition, PG&E provided a clarification on the planned direct mail outreach efforts. The plan and roadmap indicated postcards would be utilized as one of the direct mail methods. However, after further consideration, PG&E plans to instead utilize a different format of -29-

44 direct mail and send customer letters in order to provide customers with more information than a postcard will allow. The advice letter also includes several clarifications on the implementation of the High Usage Alerts. V. Learning from Current Efforts In 2016, PG&E completed a variety of outreach initiatives in support of these overall goals. The results of the Rate Reform outreach to date as well as key learnings from other marketing campaigns not specific to Rate Reform have been and will be used to inform ongoing and future outreach strategies. Below is a high-level overview of some of the best practices that will be leveraged for future education and outreach initiatives. 1. Leverage Learning from Small and Medium Business TOU Default as it relates to targeting, communication sequences and key messages, utilizing marketing best practices, training and educating key employees, third parties and other stakeholders. 2. Understand impacted customers As previous outreach efforts have modeled, continuing to leverage key customer insights and data to personalize messages, tips and resources will be critical to success. 3. Offer targeted and relevant solutions to PG&E customers to improve the customer experience and drive deeper engagement to help customers feel more in control of their energy usage. 4. Ensure proper training and support Customer Service Representatives and employees need to be provided with training and supporting tools prior to implementation. 5. Coordinate closely with stakeholders Timely and thoughtful coordination with employees, internal resource groups and external stakeholders is important to the success of outreach efforts. 6. Test/Learn/Optimize Energy Efficiency Opportunity Score ensure that PG&E continues to revisit the learnings from the Rate Reform initiatives to date as well as those still to come, and continues to apply best practices and test optimization opportunities. A. Recap of 2016 Rate Reform Campaigns The table below provides a list of Rate Reform outreach PG&E performed in A few of the communications were very specific to changes impacting a smaller, segmented group of customers, like those with rate eliminations, Minimum Bill methodology changes, etc.). While these targeted communications included an overview of Rate Reform, the primary purpose was to provide educational information directly related to the change. -30-

45 Initiative Tier 1 and 2 Outreach E-8 Rate Elimination E-7 Rate Elimination 2016 Rate Reform Campaigns Tactics Approximate Total Communication Volume In-Market Dates 2016 Direct Mail, 1,053,799 January Direct Mail (2 touches)/ (1 touch) Direct Mail, 40,688 (received a total of 2 communications) 57,999 (received a total of 2 communications) January/ February February/ March Minimum Bill Direct Mail, 375,990 February Summer Heat TOU Opt-In Pilot Acquisition TOU Opt-In Pilot Education Direct Mail, , Digital, Radio, Automated Calls 781,300 July Direct Mail 348,798 March Welcome Kits; Summer Seasonal Communications; Smartphone App DM insert and (7,000); Fall/Winter Seasonal 13,847 May, July, September/ October B. Tier 1 and Tier 2 Winter Customer Outreach (Winter 2016) In January 2016, PG&E launched a campaign to educate Tier 1 and Tier 2 customers about Rate Reform and advise them about potential winter bill impacts. Approximately one million Tier 1 and Tier 2 customers received direct mail and communications. A segmented and solutions oriented approach was utilized in this campaign. The campaign promoted low-cost and no-cost winter savings tips that customers could take advantage of regardless of their residence ownership status. The communications integrated energy efficiency messaging and provided targeted information on PG&E programs that could help customers take control of energy bills and manage energy use. One of the solutions promoted to all recipients was to complete a personalized Home Energy Checkup. Savings opportunities such as the Balanced Payment Plan and low-income programs were targeted to the appropriate audiences. Low-income customers received bilingual versions (English and Spanish), that promoted Home Energy Checkup as well as CARE or Energy Savings Assistance (ESA) programs depending on past program participation and eligibility. Customers received one of the four versions with tailored messaging: -31-

46 Segment 1: General customers, not including CCA and NEM encouraged participation in Home Energy Checkup and Balanced Payment Program. Segment 2: Low-income customers not enrolled in CARE encouraged participation in Home Energy Checkup and CARE. Segment 3: Low-income customers enrolled in CARE encouraged participation in Home Energy Checkup and ESA Program. Segment 4: CCA customers, NEM customers and current ESA Program participants encouraged participation in the Home Energy Checkup. Key Takeaway Customers engaged with the s at higher than industry average open and click-through rates (industry averages: 20% open rate; 1.77% click-through) Winter Outreach Results 46 Total Sent Open Rate Click-Through Rate 396,162 25% 4% C. E-8 Rate Elimination The E-8 seasonal rate plan was closed on February 1, 2016, and approximately 43,000 customers were to be transitioned to PG&E s E-1 rate plan, unless they proactively chose a different rate. A rate analysis was completed, and customers were sent letters that provided a best rate recommendation, either E-1 or E-6 rate plan. Customers received letters and reminders by direct mail and , and were segmented into the following nine groups each receiving customized messaging: Customers whose best rate option was E-1 were segmented to those who: a) may have saved money on the rate; b) may have saved money on the rate and were good Balanced Payment Plan candidates; c) were likely to see bills increase; or d) were likely see bills increase and were good Balanced Payment Plan candidates. Customers whose best rate option was E-6 were segmented to those who: a) may have saved money; b) may have saved money and were good Balanced Payment Plan candidates; 46 Data as of October

47 c) were likely to see bills increase; d) were likely to see bills increase and were good Balanced Payment Plan candidates; or e) NEM customers. Key Takeaway Customers engaged with the s at higher than industry averages (industry averages: 20% open rate; 1.77% click-through) suggesting high levels of engagement in the topics of rates related content. While highly engaged, less than 1% of customers chose to proactively enroll in a TOU rate, versus auto-transitioning to E-1, even if told the rate could be better for them. E-8 Rate Elimination Results 47 Total Sent Open Rate Click-Through Rate 14, % 8.86% D. E-7 Rate Elimination and Transition PG&E transitioned E-7 customers (approximately 61,000) to a new rate plan beginning on June 1, As detailed in PG&E s May 2, 2016, Quarterly Report on Residential Rate Reform, PG&E initially sent direct mail to impacted E-7 customers on February 4, 2016, informing them that the E-7 rate would be eliminated on the originally planned date of March 1, The first set of communications were designed to help minimize the impact on customers who have been on the E-7 rate for a number of years, by letting each transitioning customer know both their new default rate and the new TOU rate option on which their bills appear likely to be the lowest. PG&E developed nine segmented versions of the letter, which were based on two types of rate comparison analyses. For E-7 customers not on a NEM rate, for whom adequate interval data was available, PG&E ran a bill comparison calculating bills for each rate option based on the customer s available historical hourly interval usage data from August 2014 to July However, due to the added complexity of developing such a bill comparison for E-7 NEM and CCA customers, and given the limited time available, PG&E instead developed and used a simpler, proxy rate analysis model, which considered net usage status during the on-peak period. This E-7 NEM proxy analysis was used to identify the potential best rate for these customers based on their usage 47 Data as of October

48 from 4 p.m.-9 p.m. during the period from January 2014 November 2015, for the months in which PG&E had SmartMeter data for that customer. Based on indications of customer confusion regarding the E-7 transition, the ALJ issued a Ruling on February 19, 2016, directing PG&E to file supplemental information and serving notice of potential disallowances to marketing expenditures. In PG&E s February 23 response to the ALJ s February 19 Ruling, PG&E documented plans to delay the E-7 transition to May 3, 2016, and informed customers that they had until May 2 to select an available rate plan option. On March 25, PG&E requested, and Energy Division agreed, to extend the deadline to May 31 as the last day to select a new rate under the E-7 transition. The May 31 date would provide additional time to process letters and provide E-7 NEM customers, who had sufficient interval usage data, with a rate comparison based on a newly programmed, improved bill comparison analysis. On March 31, PG&E sent an automated telephone call with a recorded message to E-7 customers letting them know that the transition date for E-7 had been extended to May 31. In April, PG&E sent E-7 customers communications that were segmented by: Non-NEM customers NEM customers with a rate comparison NEM customers without a rate comparison Customers without a SmartMeter Key Takeaways As documented in PG&E s presentation submitted, at the request of the ALJ, for the CPUC s March 25, 2016 workshop on the Progress of Residential Rate Reform. PG&E provided best practices related to the E-7 rate elimination as well as other outreach communications. Many of these practices were leveraged for the later stages of the E-7 rate elimination and are continuing to be leveraged for future communications, generally. Best practices going forward, as documented in the March 25 presentation, are summarized below: 1. Understanding Impacted Customers Knowing more about the customer by leveraging customer personas, bill impacts, usage data, geography, etc. will improve outreach and education. Additionally, it is critical to consider possible unique cases (e.g., master meter customers, customers without SmartMeter, CCA, NEM, etc.) 2. Contact Center Training Customer Service Representatives must be well trained in advance and training should be timed with customer outreach, ideally within one to two weeks prior to the launch of customer communications. -34-

49 Additionally, rate comparison tools or data should be available to Customer Service Representatives. 3. Employee Education General employee education and training for Employee Resource Groups are important to change management efforts of Rate Reform. Employees can help to communicate and clarify changes to their community, family and friends. 4. Clarity and Timing of Communications Customer communications should clearly and simply explain all available information, options and required action. In many cases, customers respond better to a multi-phased approach (i.e., direct mail followed by ). Additionally, customers must be provided with appropriate lead time prior to a transition (i.e., 30-day, 60-day, 90-day letters). The timing of communications is important, specifically identifying when customers will be more engaged, when bill impacts will be most significant, etc. 5. Internal Operations It is critical to ensure that internal teams are prepared for change (e.g., Billing Operations, Customer Relations, etc.). 6. Stakeholder Engagement Key stakeholders are integral to the acceptance and success of the rate changes and should be brought in as early in the process as possible. This includes coordinating with CCA teams, Solar Advocates, intervenors, etc. 7. Tools and Analytics Online rate comparison tools must be available to customers prior to transition. Data and analytics must be timely, accurate and reflect actual usage data. E. Summer Heat Campaign In mid-july, 2016, PG&E launched a Summer Heat campaign, utilizing direct mail, , digital advertising, radio and automated calls, and followed a model for outreach that had been implemented in both 2014 and The campaign materials were in English and Spanish, and the call-to-action for all tactics was to visit pge.com/summer (or pge.com/verano for Spanish) to learn more about ways to save. The Summer Heat campaign direct mail was targeted to approximately 780,000 customers of the direct mail recipients whose bill impact analysis indicated they were likely to see higher summer bills. High impact customers were defined as non- CARE customers who would see a bill increase of more than $20 and 10% and, for CARE customers, a bill increase of more than $10 and 10%. The direct mail contained easy tips for saving energy, information about Rate Reform changes that were underway, and a call for customers to go to pge.com/summer (or pge.com/verano) to learn more. The reinforced all of the direct mail messages, but also included program information customized for each customer segment. Featured programs in the included Home Energy Checkup, Pool Pump Rebates or HVAC Rebates. -35-

50 1. Targeted Media Outreach In addition to the direct mail and , PG&E ran targeted media from late July through early September. As with the direct outreach, the media outreach targeted customers in the hottest areas of PG&E s service territory such as Sacramento, Bakersfield, and Stockton with media messages about ways to save energy during the hot summer months. The call-to-action was to go online for more savings tips and tools. The media campaign included 30 second and 15 second radio spots in both English and Spanish, digital advertisements, Facebook ads, search engine marketing, and recorded message that ran when customers called into PG&E. 2. Web Traffic The Summer Heat campaign drove customers to unique landing pages in both English and Spanish (pge.com/summer and pge.com/verano) that provided additional energy management information. There were over 62,000 total visits to these webpages from late July through September, with 52,000 visits to the English page and nearly 10,000 visits to the Spanish version. The average time customers spent on the site was over two minutes and thirty seconds per customer for both English and Spanish pages. Customers were primarily interested in savings tips, low-cost home fixes and more ways to save while on the Summer Heat landing page. Following the visit to the main landing page, customers were most likely to move on to the page discussing Rate Reform changes as their next step during their visit to pge.com. Key Takeaways The multi-channel approach was effective at driving high customer engagement with the website specifically with the Summer Heat campaign content. While the Summer Heat wasn t as successful as other campaigns to-date, the open rate was still high. Future iterations of the campaign will involve additional testing to determine how to raise the engagement Summer Heat Results 48 Total Sent Open Rate Click-Through Rate 315, % 0.67% 48 Data as of June

51 F. Opt-In TOU Pilot Outreach One of the primary objectives of the Opt-In TOU Pilot is to test marketing tactics to assess customer understanding, acceptance, engagement, and satisfaction with various TOU rate options. Additionally, the pilot rate options are intended to provide insight into the potential degree of hardships that might result during the 2019 default on key segments (i.e., senior citizens and low-income customers in hot areas, in accordance with Pub. Util. Code Section 745). Another key objective is to evaluate adoption rates of enabling technologies for customers on TOU rates and determine whether the enabling technologies have a significant positive influence on load impacts, bill impacts, and/or customer satisfaction. 1. Opt-In Pilot Participant Acquisition The first task of the Opt-In TOU Pilot was to acquire enough customers willing to participate for adequate measurement of various pilot tests. Recruitment materials were pre-tested and modified to help achieve customer understanding and recruitment goals. There was also a substantial financial incentive involved for a customer enrolling and participating in the pilot, tied to completion of several surveys along the way. 2. Education and In-Season Outreach Summary a. Welcome Kits In May 2016, approximately 21,000 customers who were being enrolled into the Opt-In Pilot study were sent a welcome kit. Each welcome kit contained information about the rate onto which they were being placed and reiterated important points about their participation in the study. There were four total welcome kit versions one version for each of the three Time-of-Day Study rate plans, as well as one for the control group. Customers who indicated Spanish or Chinese as their language preferences during enrollment were provided the welcome kit in Spanish or Chinese, respectively. Each welcome kit included the following: 1. Rate Education Customers were introduced to the rate onto which they had been placed and given specific details for that rate, including pricing and peak time periods. 2. Performance Tips Customers were provided with tips on how to best perform on the rate, reminders on how to shift usage away from peak hours, and low and no-cost actions they can take to manage their energy usage. 3. Physical Reminder Customers were provided with a physical reminder, in the form of appliance decals, to provide on-appliance reminders featuring rate details emphasizing peak periods. -37-

52 Customers in the control group were informed their rate was not changing, provided study detail reminders, and given tips for reducing electricity use around the house. Unlike customers on the pilot rates, customers in the control group did not receive any additional seasonal outreach for the Opt-In Pilot. b. Summer Seasonal Outreach In late July 2016, Opt-In Pilot participants were sent outreach aimed at highlighting aspects of their rate and tips to succeed in summer. While these customers had recently received a welcome kit detailing all the relevant rate information, it was important to highlight peak/off-peak and electric opportunities to shift energy usage and save, since for many customers summer is the highest-priced season of the year. PG&E developed two segments to provide more relevant tips and information to customers to help them manage their energy usage on their new rate plan. Cluster 1 Predict and Control: These customers motivations are control, predictability, and smart energy management. Their messaging direction is to take control; control/manage bills; you have the control. Cluster 2 Careful Consideration: These customers motivations include: protect the future, community, and environment. The messaging for this group focuses on more sustainable/cleaner energy future; all Californians; in it together; you can help make an impact. The communications were sent in both a greeting card format and an . It also featured integrated energy efficient messaging that introduced customers to Home Energy Checkup, and AC Quality Care program, by driving them to those webpages as well as other seasonal savings tips webpages. A customer survey, and an internal measurement and evaluation of customer energy usage data are being conducted as a part of the study. Results will help inform whether outreach is having an impact on customer load shift and reduction. c. Smartphone App Invite As a part of the enabling technology treatment of this pilot, half of participants on the Time-of-Day Study Rate Plan have received an invitation to download Bidgley s HomeBeat smartphone app as a tool to help them manage their electricity use on their new rate plan. The app can help customers monitor energy usage over time and become informed about peak periods by checking the app and receiving push notifications. Of the approximately 7,000 customers selected to be part of the -38-

53 smartphone app treatment, approximately 5,300 customers for whom PG&E has address information received an invitation to download the app in mid-july All of the approximately 7,000 selected customers received the invite as an insert in their Summer Seasonal mailing in late July Opt-In TOU Pilot Smartphone App Results 49 Smartphone App Sends Unique Open Rate Unique Click Rate TOU Pilot Smartphone App 6, % 3.45% PG&E is planning a second outreach to customers that have not completed a download and data share of the app, this time targeted towards particular persona cluster groupings and with a revised layout designed to help achieve increased adoption. d. Opt-In Pilot Results Overall Opt-In TOU Pilot participants are currently being surveyed about their pilot participation and results will be published in Q While the survey asks about TOU outreach, the questions are not extensive and will provide directional information only. Additional customer outreach research will be conducted in Q and electricity load data will be measured throughout the Opt-In Pilot to help determine whether and to what extent customers are choosing to engage with their TOU rate. These research results will also help inform whether outreach helped customers understand and achieve load-shifting and usage reductions during peak times. To date, customers have not indicated dissatisfaction with outreach materials. e. Results to Date As of September 24, 2016, there were a total of 1,433 calls to the Opt-In TOU Pilot dedicated phone line. As shown in the table below, the largest shown portion of that call volume, around 500 calls, occurred during the three weeks around the start of the pilot when the welcome kits were sent out. Minor spikes in call volumes occurred in June 2016 following the summer seasonal mailers with the Smartphone app invite, and in September 2016 when customers experienced higher summer bills without any participation incentive to reduce the net impact. 49 Downloads and data share completes (July through September 2016). -39-

54 Opt-In TOU Pilot Calls Month Count of Month % 16-May % 16-Jun % 16-Jul % 16-Aug % 16-Sep % Grand Total 1, % Of the 1,433 calls, approximately 300 were from customers wanting to opt-out of the study (tables below) and around 100 complaints/escalations. The opt-out trend declined from May to June to July, but rose again in August due to high summer bills. Microsite traffic ramped up at the end of the month in May, June and July. The overall high point for microsite traffic was reached in July 2016 the first month during which Opt-In Pilot participants received a bill on their new rates. G. Small and Medium Business Default TOU Key Learnings Starting in November 2012, PG&E began defaulting 500,000 SMB service accounts from flat rates to mandatory TOU rates (with no opt-out). This default process is ongoing and has provided key learnings that PG&E has used in developing its plan for default TOU outreach to residential customers. SMBs customers were highly segmented and received targeted messaging based on their forecasted bill impact, higher peak usage, and their engagement with online tools. SMB customers who were forecasted to have a higher impact received additional outreach, targeted tools, and person-to-person conversations, when possible, to help them identify and implement energy management solutions prior to being defaulted to TOU rates. Outreach directed customers to set up and engage with their online account in order to help provide personalized information about their usage, energy profile, rate options and possible behavior modifications or energy efficiency improvements that could help them save energy and money. 1. Leveraging Key Stakeholders and Constituents to Spread the Message PG&E representatives were extensively trained to ensure they were well-informed about these changes so they would be able to help customers understand what was happening and how they could minimize the potential impacts to their bill from mandatory TOU. Community-based organizations (CBOs) were enlisted to target diverse communities, where appropriate. -40-

55 PG&E s Customer Service Representatives received special additional training in advance of Small and Medium Business TOU outreach efforts and had rate comparison tools and individual customer data at their disposal to help them guide customers towards one of the several available TOU rates plan, and/or other supporting tools and resources. This training was especially important following the mailing of Rate Comparison Reports when call volumes increased. PG&E provided additional training to a smaller number of representatives who became subject matter experts on the rate changes and provided mentoring and assistance with specific default questions. This is an important learning that has already been leveraged for Residential Rate Reform. Starting in May 2016, PG&E selected and trained over 60 representatives to become subject matter experts on Rate Reform, provide mentorship and support to other Customer Service Representatives, and review customer outreach materials and tools prior to launch. Ensuring that PG&E employees and employee resource groups were trained about the SMB default allowed them to serve as informed ambassadors who can help to communicate and clarify rate changes to their community, family and friends. Training included providing employees talking points about what is happening and resources for customers (i.e., visit your online account; take the Business Energy Checkup, etc.). Talking points and collateral were also available to customer facing frontline employees such as gas service representatives and meter technicians. These important tactics have already started to be leveraged in 2016 for Rate Reform and will continue to be expanded upon from 2017 through See Chapters 6 and 8 for further discussion of these tactics. To further support a smooth customer experience and minimize frustration surrounding a changing rate, the Small and Medium Business TOU default experience reinforced the critical need to ensure that all necessary internal stakeholders (Billing Operations, Customer Relations, etc.) are properly prepared in advance of the roll-out of default. The residential Default TOU Pilot will help inform many critical data points to help make the 2019 rolling Residential TOU default more successful. Data from the Default TOU Pilot such as response volumes, customer reaction and other information points will help operations teams and others plan and adjust accordingly. Coordination with key stakeholders was integral to the acceptance and success of the rate changes for the Small and Medium Business TOU default. These stakeholders were identified and included in the outreach planning process as early as possible. For -41-

56 Residential Rate Reform, many of these conversations and planning sessions with stakeholders are already taking place, as a result of various WGs and other PG&E relationships. It will be critical to continue to share outreach messages, plans, talking points, and other resources to collaborate and inform constituents about what is happening, when, and how to best approach special populations. 2. Communications Clarity and Timing Customer communications for the Small and Medium Business TOU default reinforced several best practices that PG&E will continue to use for its marketing efforts across all rates outreach. Communications for the SMB audience clearly and simply explained: (1) what was happening, (2) what options were available, and (3) what actions were required prior to and after the default. PG&E used a multi-touch, phased approach (direct mail followed by ) that resulted in positive customer engagement. Not only is the timing of communications important, but; specifically, it is vital to identify when customers are likely to be more engaged, such as when their bill impacts are expected to be most significant. As learned from the SMB default, it is critically important to provide customers with simple but specific actions to take through the course of phased outreach. Increased urgency, especially for Non-Benefiters, helped guide customers as the default date came closer. This model will also be leveraged for residential customers as the time to default TOU approaches. Just as with SMB outreach, well-timed and consistent messaging and calls-to-action will be applied as a best practice to build customer familiarity, and foster a sense of choice and control throughout TOU the transition process. H. General Website and Contact Center Results PG&E.com is an important outreach and education tool for Rate Reform. Visits to the pge.com webpages are tracked and closely monitored. Per the table below, the majority of web traffic driving to pages related to Rate Reform and rate plan options shows a significant growth in engagement through webpage visits between 2015 and 2016: -42-

57 PGE.com Topic Understanding Rate Plans Compare Plans Tiered Base Plan TOU Plans Rate Changes Landing Page Learn more about rate changes PGE.com Links Visits Oct Sept 2015 Visits Oct Sept Year over Year Variance Rate Information Pages -plans/rate-planoptions/understanding-rateplans/understanding-rate-plans.page 103, , % -plans/how-rates-work/find-my-bestrate-plan.page 29,304 61, % -plans/rate-plan-options/tiered-baseplan/tiered-base-plan.page 113, ,060 63% -plans/rate-plan-options/time-of-usebase-plan/time-of-use-plan.page 41, , % Information about Rate Reform Changes -plans/how-rates-work/ratechanges/rate-changes.page 100,304 85,093 21% -plans/how-rates-work/ratechanges/general-rate-case-rate- 9,275 35, % updates/general-rate-case-rate- updates.page Calls to PG&E s Contact Center relating to Rate Reform are also monitored. In 2014, PG&E set up a dedicated phone number for Rate Reform which includes a self-service interactive voice response that provides customers with references to PG&E s website and other tips. This dedicated phone number is provided in most Rate Reform education and outreach communications. However, for larger initiatives such as the Opt-In TOU Pilot and fall 2016 Rate Comparison Report test and learn, separate phone numbers have been established to facilitate call tracking and monitoring for these specific initiatives. Appendix A includes a chart showing the number of calls to the general Rate Reform dedicated phone number. The number of calls offered measures the total number of calls made to the direct line, and the calls handled measures the number of calls which were handled by a Customer Service Representative. A peak call volume of 5,641 calls occurred in February 2016 and was primarily attributed to Tier 1 and Tier 2 outreach, E-8 Elimination, initial communications about 50 Data as of October

58 E-7 elimination, and changes to the Minimum Bill. Given that over 1.5 million total customer communications were distributed in January and February for these specific rate change events, the peak number of calls in February was small on a percentage basis. The volume of calls was consistent in March, April and May due to the extension of the E-7 elimination and the E-6 closure. During this time, PG&E s contact centers monitored and categorized specific E-7 rate elimination calls to ensure customers were receiving the proper rate change information. Additional training and support were provided to Customer Service Representatives as needed. A much smaller peak occurred in August due to the Summer Heat campaign. VI. Overall Marketing, Outreach, and Education Introduction A. Marketing Plan Objectives PG&E developed this Residential Rate Reform marketing plan based on the following three objectives: (1) address the needs of a unique and diverse customer base through careful segmentation; (2) prioritize a positive customer experience; and (3) allow for flexibility and optimization based on the results of Opt-In and Default TOU Pilot data, final decision on the default rate, ongoing customer research and response to in market test campaigns. B. Marketing Goals Generate awareness and understanding among customers regarding their rate options, choosing the right rate plan for them, and what they can do to better manage their use and ultimately their bill. C. Target Audience While the marketing activity described in this plan will address PG&E s residential customer base, particular attention will be paid to the following priority target groups: High usage customers, including those exceeding 350% of baseline; Those most likely to see significant bill impacts due to default TOU, if they don t change their behavior while subject to one-year bill protection; Those most likely to benefit on ETOU-A and B rate plans, including low income customers; Low usage Tier 1 and Tier 2 customers; and Low income and hard-to-reach customers. -44-

59 D. Marketing Strategies To address PG&E s overarching goal leading up to default TOU in 2019, as well as to help PG&E customers to shift their electric usage away from peak periods and to conserve energy overall, PG&E s focus is on moving customers from an unengaged state to becoming aware of the new ways they can control their energy bill. This is not easy and will require time, repetition and a variety of engagement channels in hopes of catching customers when they are willing to receive, pay attention to and ultimately act on our outreach efforts. The first step is not simply providing information about rates to people who are uninterested, rather it is creating personal engagement with tools and solutions that intrigue and empower customers to manage their energy use. PG&E marketing strategy has three phases: 1. Phase 1 in 2017: Lay the foundation for TOU engagement. Deploy a test and learn approach utilizing multiple new tactics and messages focused on choice and control to engage customers in energy management and new rate options. This proposed year of test and learn aims to allow PG&E to determine the most efficient and cost-effective ways to drive awareness, understanding and engagement leading up to Phase 2 in 2018: Scale and optimize. Deploy the most successful campaigns from 2017 at greater scale, through the Default TOU Pilot, to drive deeper engagement with tools, tips and programs to help customers conserve, and glean more lessons learned and prepare for the full rollout of default TOU in Phase 3 in 2019: Continue education and engagement outreach efforts to prepare eligible customers for the ongoing roll-out of default TOU, and tailor the quantity and timing of default touch points based on the expected customer impacts. Please see Appendix B for PG&E s Proposed Residential Rate Reform ME&O Timeline. PG&E plans to use the following specific strategies to achieve PG&E s overarching objectives with respect to Residential Rate Reform. 1. Tools and Tips Engagement Campaign This campaign will be the centerpiece of engaging PG&E s customers over the next two years and through the transition to default TOU. PG&E will be focused on delivering a steady stream of communications focused on tips, tools and programs. The primary communication channels will be digital (search and display advertising) and , however, additional avenues will be used such as the monthly bill package, communitybased outreach, PG&E s website, Contact Center on hold messages and information displayed at local offices. -45-

60 Digital display and search creates the foundation for an always-on campaign running consistently throughout the year. As discussed in Chapter III, customers continue to migrate to digital channels. Utilizing the always-on approach allows PG&E to engage with a majority of our customers, where they already are, in the most cost-effective manner. PG&E s digital display plan will include a schedule of high volume impressions million per four week period. 51 The campaign will be designed to speak to all customers, but content and targeting will consider attributes such as age, household income level, typical tier reached on Schedule E-1, psychographic segments, diverse in-language outreach in languages such as Spanish, Cantonese/Mandarin, Hmong, Vietnamese, and Korean. The campaign will be geo-targeted to specific climate zones to support heavier media weight in certain geographic areas during seasonal campaigns. Digital search will provide an ongoing layer of media to further engage customers as they seek out more information. Content and messaging will focus on tips, tools and programs such as rate options and will be regularly rotated across channels to drive momentum and to avoid message fatigue. Some of the specific items that PG&E plans to promote to engage customers with better managing their energy usage are: 1. Create an online account on pge.com (or do so with the help of a CBO or local office representative); 2. Complete a rate analysis 52 and change rates as appropriate; 3. Take the Home Energy Checkup; 4. Sign-up for Energy Alerts; 53 and/or 5. Adopt new, positive energy behaviors. Additionally, a variety of programs will be promoted on a targeted basis like the CARE and ESA programs for low income customers and Rebates, Energy Upgrade California Home Upgrade and SmartRate programs for those who are eligible. PG&E will use additional tactics during this campaign such as the following: 51 Impressions are a measure of advertising weight the potential total advertising exposures delivered to a targeted audience over a given period of time (in this case, the average 4-week period). PG&E determined million is a reasonable level of impressions to support key messages at any given time, with the flexibility to allow for hyper-targeting to specific segments as needed. The definition of impressions is the sum of the target audiences of all vehicles (media types radio, digital, print etc.) in the schedule. 52 As of October 2016, the online rate analysis is not available for NEM and CCA customers. 53 As of October 2016, Energy Alerts are not available for NEM and CCA customers. -46-

61 1. The Residential Energy Advisor digital newsletter will be used to provide customers with specific messages on tools, tips, programs and their benefits. This communication reaches a large number of Tier 1 and Tier 2, high usage and low income customers. 2. CBOs and local office support will focus on low income and hard-to-reach customers (as described in Chapter IX below). For example, CBOs and local office staff will be trained to help customers sign-up for specific tools, programs, provide behavioral tips and will be supported in-language. 3. Contact Center on hold messages with rotational messages on tools, programs, and behavioral tips. 4. Information on the PGE s home page with rotational messages on tools, programs, and behavioral tips. 5. Triggered s, a component of marketing automation, will be used to drive engagement in a more targeted way. PG&E plans to analyze customer data to create s that will take customers through an energy management journey one step at a time. 2. Pre-Summer and Pre-Winter Seasonal Campaigns Since the Summer of 2014, PG&E has deployed campaigns promoting energy savings solutions, tips and programs to customers that are likely to see high bills during the hottest and coldest times of the year. These campaigns have included direct outreach efforts including and direct mail to customers that were found likely to have the highest bill impacts under the early stages of Rate Reform. PG&E plans to continue executing these seasonal targeted campaigns and include an overlay of media including radio, digital and social media in highly impacted areas to reinforce the messages and reach a wider audience that may feel the impact of summer heat or winter cold on their bills. The seasonal campaigns will continue to be positioned as annual reminders to customers to engage, conserve and adopt positive energy behaviors in an effort to mitigate large swings in their seasonal bills. Multiple channels will be leveraged in key geographies impacted by cold and hot weather. In addition, PG&E plans to continue targeting those most impacted by High Usage Surcharge and tier changes, which can include Tier 1 and Tier 2 low usage customers. Those customers will receive direct outreach mostly in the form of direct mail or featuring segmented tools, programs and behavioral tips to help them manage their energy use. Additional planned tactics: 1. Telephone Town Hall events for Seniors, low income and hard-to-reach customers. This type of program allows customers to join a phone conference and learn about a variety of topics through a town hall format with various speakers and a question and answer session. -47-

62 2. Promotion in the bill package. For example, in Q1 2017, PG&E is deploying a bill insert to help make customers aware of the tiered plan changes, including the tier collapse. 3. Digital media may be layered on to increase reach and frequency within targeted customer segments such as low income and hard-to-reach. PG&E s pre-summer and pre-winter campaigns will be particularly important to prepare customers for how to engage with their energy use during peak seasons, as part of their transition to default TOU rates. PG&E s preliminary analysis of the type of default rate structure (TOU-Lite) that may be proposed in its 2018 RDW Application on January 1, 2018, suggests that, overall, only a small percentage of customers are likely to be non-benefiters year round. However, a large percentage appears likely to be negatively impacted in the summer months on TOU rates. The chart below shows the anticipated impacts from an assumed 2019 default rate if it were based on PG&E s current ETOU-A rate structure. If this or a similar rate is adopted, the summer campaign will be critical for managing customer expectations regarding seasonal high bills and assisting them with ways to lower them. PG&E will also help customers understand that on an annual basis their bill savings may be positive, despite their summer bills being high. -48-

63 Preliminary 2018 E-TOU A Bill Impact Analysis 54 % Customers # Customers Impact Categories (Summer (Summer Avg) Avg) Benefiter Decrease of > $10 or 10% (non-care) 1.51% 32,953 Decrease of > $5 or 10% (CARE) 0.14% 1,145 Neutral (+) Decrease of $0 -$10 or 0% -10% (non-care) 1.78% 38,845 Decrease of $0 - $5 or 0% - 10% (CARE) 0.21% 1,717 Neutral (-) Increase of $0-10 or 0% -10% (non-care) 59.03% 1,288,204 Increase of $0 - $5 or 0% -10% (CARE) 42.01% 343,521 Mild Non-Benefiter Increase of $10 - $20 or 10% - 20% (non-care) 22.25% 485,559 Increase of $5 - $10 or 10% - 20% (CARE) 24.55% 200,748 Non-Benefiter Increase of > $20 or 20% (non-care) 15.24% 332,581 Increase of > $10 or 20% (CARE) 33.10% 270,663 a. Pre-Summer and Pre-Winter Media Plan PG&E s media plan was developed with an eye toward meeting its overall objectives, while at the same time managing costs to minimize total expenditures as much as possible. PG&E recommends that media begin prior to the start of each summer and winter season. A recommended reach and frequency is 75% reach and 4-5X frequency, which are expected to achieve a highly visible, yet efficient campaign. PG&E will need to conduct more analysis to ultimately determine the appropriate reach and frequency level. PG&E recommends a campaign with a heavy focus on digital display and video, traditional and digital radio, and community/diverse print based on what PG&E knows today about its goals, objectives and assumptions for Rate Reform. PG&E plans to leverage channels that are newsworthy, informative, authoritative and community-based. PG&E plans to explore the following strategies and tactics in its plan: 54 This data analysis was performed on October 3, 2016 for a representative sample of accounts, and is based on dollar ($) impacts with an assumption that three million customers would be eligible for default in While it is expected that the percentages in this analysis will remain consistent, PG&E will re-run the analysis to include both dollar ($) and percent (%) impacts for the target population prior to execution of customer outreach. -49-

64 1) Digital Media a. Digital display and search may be planned at million impressions per month, and digital video planned at 3 million impressions per month. These recommendations could change based on continuous monitoring and analysis. b. Other strategic targeting recommendations that will be considered: possible Geo-targeting to Designated Market Area (DMA), but focus on climate zones by zip code, re-targeting strategies. c. Ongoing search will be relevant to Rate Reform, including broad keywords and phrases such as home care, home energy, home improvements, conservation plus money saving tips, energy savings, energy save, energy audit, energy calculator, and saving energy, how to save electricity bill, etc. The final search keyword and re-targeting recommendations will leverage the data PG&E has collected over the last few years. 2) Radio a. PG&E recommends digital radio and diversity radio, with a focus on Spanish and Chinese. b. Traditional radio may be recommended and scheduled at 60 Target Rating Points (TRPs)/week for 4 weeks (60% reach, 4.0 frequency). c. Digital radio will be considered to provide engagement with companion banners. 3) Print a. Diverse print targeted at Spanish and Asian languages to support low income and hard-to-reach customers. b. Community print focused in hotter summer climate zones, such as Sacramento, Central Valley, Bakersfield, Fresno, Chico, Monterey and Salinas. c. Home-oriented magazines (e.g., Sunset Northern California edition, 326K circulation). 4) Alignment with the Greenberg Blueprint on Mass Media Plan The Greenberg Blueprint communication plan was built on continuous statewide paid media along with IOU (local) paid media focused on pre- and post- default. PG&E s position is that the Greenberg Blueprint continuous (high level) paid media direction, whether at statewide or IOU (local) level, is a high cost and inefficient approach. include: PG&E s paid media plan employs more fiscally prudent, yet effective, strategies that a. A two-pronged plan structure that combines a very cost-efficient, continuous foundation of media, partnered with focused flights of summer and winter seasonal support. b. A cost-efficient media mix aimed at achieving the maximum possible effectiveness for the minimum possible budget expenditures. -50-

65 c. Reach and frequency goals to minimize message wear out and continuous high-cost production needs. PG&E recognizes that as statewide and IOU ME&O plans are further developed and adopted, communications will need to be tightly integrated to appear seamless to the consumer and minimize duplication of efforts and expenditures. PG&E believes that continuous media messaging is important to reach consumers during the Rate Reform process. Therefore, PG&E s plan includes an always-on, digital foundation, utilizing digital display and search which allow PG&E s communications to be highly targeted and efficient while providing opportunities to engage the consumer throughout the campaign. The digital display layer is not planned on a traditional reach and frequency basis, rather it is planned on impression levels and tactics that can target and re-target the customer to deliver specific consumer segments, tier groups, climate zones, etc. PG&E is currently recommending a 75% reach and 5x frequency during the average 4-week period, 55 which is adjusted from the Greenberg Blueprint recommendation (85-90% Reach and 10+ frequency over an average of four weeks), 56 to better manage costs as well as avoid message fatigue for customers. This reach/frequency goal may be delivered during the pre-summer and pre-winter periods, by which paid media advertising delivers timely messages to consumers when they are most likely to be motivated to want to learn and practice seasonally smart energy habits. PG&E believes that impacting 90%+ of consumers with ongoing messages is important, however, other communication elements such as public relations and direct marketing, should be expected to contribute to that goal. It should not be the sole role of paid media to deliver high impact. Relative to each of the IOU s local territory plans, the Greenberg Blueprint recommendation was heavily weighted to print (newspaper), accounting for 31% of dollars and less than 4% to digital/social. This heavy dollar allocation to print (regional USA Today, Major Dailies) skews the media plan to Seniors 65+ and carries a high cost per thousand impressions premium versus other local/regional media types (whether 55 Reach is the percent of people (unduplicated) within the target audience that are estimated to be reached by the advertising, during an average 4-week time period (4-week is the standard measure for the calculation). The goal during the campaign time period is to reach 75% of PG&E s target audience an average of 4-5 times during a 4-week period. 56 RROIR MEO Blueprint: Integrated Marketing, Measurement, and Alignment Strategic Action Plan for Residential Rate Reform and TOU_V2. Greenberg, Inc. August 19, p

66 based on circulation cost per thousand or Adult Readership cost per thousand impressions). While PG&E s plan includes some print media, PG&E recommends a much higher percentage of digital media than did the Greenberg Blueprint. Digital media selection will utilize all trackable digital elements 57 to generate quality awareness and then potential site engagement with visitors learning more about energy management including rates. In addition, Public Relations was a limited portion of the Greenberg Blueprint recommendation. PG&E believes that this represents a missed opportunity as public relations can more efficiently reach customers than would a large percentage of the buy in print. Therefore, PG&E recommends increasing support in public relations and reducing the Greenberg Blueprint s recommended overall print buys. However, PG&E is in agreement that diverse print outreach, including local community papers should enable customers who are income-qualified for the CARE and ESA programs, as well as hard-to-reach customers, to see relevant messages in summer and winter. 3. Engagement Tests PG&E s plans to consider a variety of strategies and tactics to test ways to further engage customers with managing their energy usage. These programs will be leveraged for various customer segments and with customers at different levels of energy engagement, to help them take the next steps in their energy management journey. a. Gamification Program PG&E s plan proposes to test innovative strategies like gamification programs, with rewards to drive customer engagement in tips, tools and programs. About 58% of all Americans play video games with average age being 30 years old, and 45% of those who play being female. 58 In addition, gamification has been used effectively in energy efficiency programs to change behavior and reduce energy use. The American Council for an Energy-Efficient Economy (ACEEE) conducted a study where they collected information on gamification related to energy efficiency programs. ACEEE found that in the nine projects it reviewed, there was a range of 3 6% energy savings amongst a sizable number of participants, proving that gamification could be effective in motivating 57 Users can be tracked from impression to click, click to call, call to conversation, creative messaging interactions, engagements, and/or PG&E program enrollments as well as the device (desktop, tablet or mobile) and geography. 58 Gamified Energy Efficiency Programs, American Council for an Energy-Efficient Economy, February 11,

67 savings. 59 Given that PG&E s Rate Reform ME&O communications focus on both conservation and load-shifting, PG&E believes that there is a substantial opportunity to leverage gamification for engagement and potentially energy savings. Given the broad acceptance of Americans playing video games, PG&E plans to test across all segments and personas to understand the impact and efficacy of each approach, including those most likely to be negatively impacted by TOU rates in 2019 as well as low income, Tier 1 and 2 and high usage customers. Customers are motivated to engage with reward programs if they know they will be compensated. When customers psychologically feel like they earned a reward, they see it more like a prize than marketing. PG&E will consider testing a variety of offers and rewards potentially leveraging digital and mobile-ready platforms, such as digital banners, social media and s. The types of games tested could include: trivia games, scratch-off games, spin the wheel and object comparison. In addition, to be effective, PG&E recommends games that will be quick, requiring only about five to ten seconds of a customer s time. The current thinking is that PG&E would like to test two hypotheses: (1) whether Millennials (defined as ages 18-34), who are known to be more likely to play trivia games, will engage with energy themed trivia games; (2) whether Seniors, who are known to be more likely to play chance based games (scratch off and spin the wheel), will engage with energy themed chance based games. Games could likely employ a smart rewards system (i.e., timers, reward swaps, gifting, etc.). Incentives and rewards are key components to this strategy. PG&E proposes to explore testing a variety of reward values and prizes. For example, PG&E could test a game with a reward versus one with no reward, as well as test medium and high value (grand prize) incentives, based on calls-to-action. Types of smart rewards could include: quantity-based (everyone eligible to redeem something), percentage-based (a percent of the audience is eligible to redeem based on scoring), grand prize (everyone is eligible to enter to win, but only one winner is named). Categories of rewards could include: physical product (free or discounted; energy efficiency related or not), gift cards (energy efficiency related or not), donation/charity based, service like a home energy make-over. 59 Gamified Energy Efficiency Programs, American Council for an Energy-Efficient Economy, February 11,

68 PG&E recommends driving awareness and engagement with such rewards programs, once proven and refined through testing, through a variety of channels including direct mail, and targeted mass media and in community-based outreach. b. Energy Engagement Kits Managing their energy use is generally not at the top of the to-do list for most PG&E customers. Even when it is, customers don t often feel like they can do more than they currently do. In order to bring customers attention to managing their energy use and eventually to encourage load-shifting behaviors PG&E has an opportunity to develop what could be truly engaging, interactive experiences in the form of energy shifting kits. These kits could include products, literature and helpful instructions or tips to help customers lower their overall energy use and begin to shift behaviors. Ideally, they would have one or two innovative, cool products that PG&E hopes consumers will find enticing, as the impetus for obtaining a kit. PG&E is considering offering the kit in two ways: Kits as giveaways or incentives: Low income and hard-to-reach audiences could benefit from the products included in the kit. PG&E propose distributing them through our CBOs and other networks to use as giveaways when customers agree to take a desired action such as completing a Home Energy Checkup or provide their address. Kits for purchase: PG&E believes they will be attractive to many customers and most impactful for high usage customers. 1) Kit Contents PG&E is evaluating the following items that could be offered as part of its Energy Engagement kits: a. Advanced power strip Allows customers to determine which electronics/appliances in their home need to be always-on and which can sometimes be shut down (e.g. TVs, etc.), giving them the ability to conserve plug load overall and control to power on during off-peak hours. b. LED light bulbs With prices dropping across the U.S., LED lighting is becoming a real option for Americans at every economic level. If every American replaced one light bulb with an ENERGY STAR bulb, our country would save enough energy to light 2.6 million homes for a year. -54-

69 c. Magnetic digital clocks Provide two magnetic clocks that are pre-programmed to alarm when off-peak hours hit, serving as a visual and audible reminder that it s an ideal time to be using energy. NOTE: These are specific to load-shifting, and may only be included in kits specific to TOU rate adoption or TOU outreach in 2018 and d. Smart Wi-Fi thermostat The kit could also provide a smart thermostat that gives customers ultimate control and understanding of their energy use, and is all made available on their smartphone. PG&E recognizes that this is a higher cost item and which must be carefully considered due to the higher cost. PG&E will be reviewing results from this year s test marketing of a Simple Savings Kit, as well as reviewing the attractiveness of different energy saving products relative to critical audiences like low income and high usage customers, to determine the final recommendation of contents for such kits. c. Behavioral Pledges In 2016, PG&E embarked on a behavioral-based marketing campaign test called Step Up and Power Down. The test is continuing and results are still pending, but the objective is to determine if nudging or signing a pledge to reduce energy use is an effective way to change consumer engagement and behavior with electricity. The campaign supports the customer energy management journey through personalized interactions, calls-to-action, and social norming and will measure impacts on customer participation in PG&E s energy efficiency portfolio over time. The campaign found a tremendous partner in the city of Woodland, CA and has generated over 1,500 residential participants. Woodland is a small city of approximately 60,000 residents, median age of 33 years old, and a median income of $55K. 60 Woodland and the immediate surrounding area s economies have largely been based on agriculture. There were 19,806 housing units at an average density of 1,294.3 per square mile (499.7/km²), of which 10,472 (55.9%) were owner-occupied, and 8,249 (44.1%) were occupied by renters. 61 Forty-seven percent of the Woodland population is of Hispanic origin. Average summer temperatures are 96 degrees Fahrenheit and average winter 60 United States Census Bureau Quick Facts for Woodland City, California United States Census Bureau Quick Facts for Woodland City, California

70 temperatures are 36 degrees Fahrenheit. The Step Up and Power Down team conducts marketing and outreach activities to deepen relationships with participants (individuals and organizations) and motivate them to take action. Participants are encouraged to select the recommendations that are most relevant and accessible to them and to pledge to take those actions. Each action pledged and completed moves the customer along the customer journey and creates the conditions for sustained behavior change and long-term engagement with PG&E. Some of pledge options for customers to choose from include: Complete the Home Energy Checkup Eliminate energy waste by closing doors and vents to unused rooms Winterize windows Set water-heater temperature below 120 degrees Use timers on outdoor lights Use smart power strips Wash clothes in cold water Air dry clothes Set thermostat at 68 degrees during cooler weather months PG&E will be monitoring these participants and comparing their engagement with the ME&O outlined in this plan to the rest of the residential customer base to determine if their previous hand-raising has any impact on these customers interaction with communications and subsequent program participation, energy savings and behavior change. d. Increase Online Accounts In addition to digital and campaigns for tools engagement, additional strategies will be leveraged to increase online account creation and increase PG&E s overall penetration of addresses. PG&E currently has 3.1 million residential customers with an online account. One of the biggest barriers to getting customers to sign-up for a free online account is the requirement to enter their account number. Approximately 40% of online account registrations are aborted when customers are -56-

71 prompted to input their account number. 62 To reduce this barrier, PG&E is creating an account lookup tool on its website that will allow these customers a timely and easy way to get this information so they can more easily complete the process and begin taking advantage of the tools and information available at pge.com. Additionally, PG&E is investigating other opportunities for making the online enrollment process easier and more seamless for customers, by potentially creating their accounts for them on the backend. Customers would then be given access to a link where they would provide security information that allows them to check their information and create a password before getting access to their private usage and other account information. e. Engagement With Specialized Energy Statement Formats Customers find energy statements difficult to understand and this is made even more difficult for those who are English language learners and audiences who require larger font formats like seniors. PG&E is considering launching campaigns to hard-to-reach customers to increase awareness about their bill by encouraging customers to enroll in customized bill formats. The target audiences for these efforts are Chinese speaking customers, Spanish speaking customers and Seniors (65+). PG&E will explore promotion of Spanish-language and Chinese-language bills using multi-cultural channels. For example, PG&E is able to target Spanish-speaking customers leveraging new data called Geoscape that is a third-party data source identifying language preference. PG&E can enable enrollment with this target audience by allowing them to sign-up for in-language bills via text/sms on their mobile phone, which is their preferred communication channel. Using their preferred channel and their preferred language will make it easier and more convenient for them to sign-up quickly. For seniors, PG&E plans to explore automated calls to promote use of large font energy statements. In addition, these customized bill formats will be promoted in community-based outreach efforts. PG&E is also working to improve the overall experience of its website for in-language customers to support these outreach efforts. More detail on these efforts is presented in Section 5 below on PG&E s proposed channel support for its ME&O. Overall, PG&E s messaging needs to address a complex set of objectives inherent in our goals: 62 Webtrends Report on PGE.com 2016 Month over Month. -57-

72 a. Engaging the unengaged: How does PG&E create messages that will vitalize our customers relationships with energy in an unprecedented way? b. Balance of EQ and IQ: What is the ideal balance, and how does PG&E design messages that speak to both? c. Behavior change over time: What methods can PG&E bring to bear that are proven to create widespread change through long-term education and engagement? d. Message translation across unique target audiences: What message structures will have the flexibility to successfully speak to each target audience? The path from unengaged to engaged needs to be viewed as a long-term investment, not something heavily-informative campaigns can accomplish with just a few touches. There are very few aligning success stories for short-term informationbased campaigns that are meant to accomplish widespread awareness, education and eventual behavior change. a. Digital TV transition took place over several decades with multi-layered communications campaigns. b. ENERGY STAR awareness and understanding is commonly thought of as a success story. Although ENERGY STAR hasn t yet fully accomplished customer education, its current high levels of awareness took decades and many layers of communication including ubiquitous labeling to achieve. c. No Texting while Driving campaigns have been active for several years, with a multitude of communicating parties. Despite the critical nature of this public safety threat, and the intensive nature of marketing to date, the campaigns have seen only very limited success in achieving behavior change so far, with only nominal decreases in texting while driving. Although these success stories took many years to achieve, PG&E is hopeful that there could be a more rapid track to engagement with our customers here, by centering communications of messaging on solutions-based approaches. Customers who have participated in other utility programs especially those in low income segments show a much higher level of satisfaction. If PG&E s Rate Reform approach can be designed to be delivered in the context of solutions for customers, PG&E believes it is likely to create the conditions to significantly increase engagement by those currently unengaged. E. Emotional Quotient (EQ) & Intelligence Quotient (IQ) There is merit in Greenberg s Blueprint recommendation to utilize both EQ and IQ in rate change outreach. The Greenberg Blueprint outlines several references and approaches to this strategy. There is a lot of research on the differences between these and their importance in marketing and engagement. Far fewer sources highlight best -58-

73 practices in balancing the two. While balance is important to consider, emotional intelligence, in particular, should be leveraged precisely because it actually improves PG&E ability to understand concepts. Utility rates are a complex, confusing and unfamiliar concept for people. Utilizing emotional messages could greatly enhance the ability to create greater customer understanding of and engagement with their electric rates. Customer experience is often thought of as being driven by right-brain practices making things more effective and making processes more efficient. But there s a whole left-brain element of customer experience that we think is going to be a greater focus as companies try to understand how to deliver emotionally compelling experiences. Michael Gazala, VP Research Director, Forrester From a marketing perspective, brands tend to use EQ strategies primarily because brand loyalty is built at the emotional level, not the functional/data level. Positive relationships with a brand are built based on how the product, service or company makes us feel, rather than what it makes us think. Consumers demand, whether consciously and subconsciously, that every brand they interact with provides this kind of emotional satisfaction, including their energy utility. EQ is also central to behavior change. People might know how to do something and know that it is the right thing to do, but act in an opposite manner. This is often because the stimulus of our subconscious is impacting our emotions and how we feel like anxiety or fear associated with behavior change. For concepts as complex as engaging with their energy use, it is important to provide the data that speaks to people s IQ (to demonstrate the factual case) as well as recognize where they might be emotionally in the consideration process to bridge the EQ gap (such as addressing the barriers that might be getting in the way of a desired action). This is particularly important when dealing with economic and racial diversity and being sensitive to cultural differences/nuances. Ultimately, for some customers to be satisfied with and successful on TOU rates, they would have to undertake changes in their daily lives, such as conservation and load-shifting, that could be perceived as being inconvenient. For example, the financial benefit of load-shifting may seem negligible or simply not important enough to them. In other cases, there is a real risk that a decision not to conserve more or load-shift could mean higher bills. The default TOU transition asks for a tremendous amount of understanding and action from our electric customers on concepts as to which they are barely if at all engaging. -59-

74 No amount of psychological awareness will overcome people s reluctance to lower their standard of living. Daniel Kahneman, from Don t Even Think About It, By George Marshall 1. Message Approach If PG&E expects our customers to actively engage with their energy use largely in the absence of motivating, tangible benefits, PG&E needs to activate a continuum of messaging that tackles pieces of this change over time, in a way that is digestible and compelling for our customers. PG&E believes it will take concerted effort over the next three years to lead residential customers to TOU and set them up for success once they are defaulted. To do this effectively, PG&E needs to create and apply its messages in moments that influence customer s experience and expectations. This message cannot simply be layered on if long-term engagement is to be achieved. Rather, PG&E must identify the intersections of their needs/desires and PG&E s messaging. This is where messaging around rate options and ways to engage with energy use can be most effective as the first step to TOU default success PG&E is exploring the following time-based messages: 2017 Customers have new rate options and ways to engage with energy use to provide more choice and control. The operative words here are: New This gives customers a reason to care. They re not used to new concepts from their utility. Ways to engage -This sets up a reason to listen. Most people are not used to engaging with PG&E outside the transactional relationship The messages to be utilized for 2018 will be heavily influenced by the responses and overall performance of 2017 campaigns. Assuming the 2017 priming takes place, as proposed above, residential customers should have already begun to think about and take action on low-barrier engagement steps (e.g., switching to the best rate, doing more energy efficiency, utilizing bill management tools, etc.). This priming is aimed to set up PG&E s plan to begin to introduce the concept of TOU. PG&E currently anticipates building its message around choice and control. PG&E will use the test and learn approach that is the gold standard for successful long-term marketing campaign. PG&E will also continue to apply the test and learn approach from its messaging used -60-

75 in the Default TOU Pilot expected to begin in March 2018 for approximately 250,000 residential customers PG&E will ramp up the default of most customers to TOU rates. The timing above uses a priming approach to shifting market behaviors. 63 It s often referred to as the hidden effect, referring to something to which someone is exposed to (stimulus) at an earlier time that will trigger and/or shape their response in the future. 64 For these messages to work long-term, the priming messages must align with the core beliefs, attitudes and perceptions of the customer otherwise the message could turn customers off. When this happens, people can t really explain why they have a negative view of the company or initiative, they just do. This is because priming occurs at a subconscious level and those hidden effects can impact our efforts in a positive or negative way. F. Considerations for Specific Customer Groups For PG&E s outreach efforts leading up to and including default to TOU, certain types of customers may require specific outreach or refined messaging to make them aware of the rate changes that may impact their bill. Since many of these customer groups are also low usage at the current Tier 1 and Tier 2 levels, outreach efforts will include a focus on engaging these customers in managing and lowering their energy usage by providing tips and tools. Throughout the Residential Rate Reform transition, PG&E will leverage learnings from prior communications and both the Opt-In and Default TOU Pilots with diverse groups of customers. PG&E hopes to reach customers through a method or channel to which they are most likely and able to respond to including direct mail, , digital, radio, in-person events, telephone outreach, CBOs and in-language materials as deemed appropriate. 63 Machin, J., Fitzsimmons, G. (2005). Marketing by Mistake: The Unintended Consequences of Consumer Research. Applying Social Cognition to Consumer Focused Strategy. Eds. Kardes, F., Herr, P., Nantel, J. Mahwah, NJ: Lawrence Earlbaum Associates. Feldman, J., Lynch, J. (1988). Self-generated validity and other effects of measurement on belief, attitude, intention, and behavior. Journal of Applied Psychology. 64 What is Priming? A Psychological Look at Priming & Consumer Behavior. Motive Metrics. Behavior. -61-

76 PG&E will collaborate with the advisory members of its Communities of Color initiative to identify opportunities to target these audiences. For example, PG&E has identified there is a Hispanic skew within the Beyond Their Means persona and an Asian skew within the Stable Living persona. PG&E plans to work with the Communities of Color advisory team to identify additional ways to target these specific audiences in order to obtain additional customers in the voluntary TOU rates before default TOU is rolled-out. PG&E s direct outreach will include key recruitment information and calls-to-action in large print on materials, and will include telephone numbers and a website address to provide customers with options on how they can obtain more information based on discussions with Melissa Kasnitz of the Center for Accessible Technology. In 2016, PG&E comprehensively redesigned its website and is striving to meet the Web Content Accessibility Guidelines (WCAG) AA Standards. 65 As part of the accessibility improvements, PG&E updated its website to include a refined web design with larger fonts, a higher color contrast, easy click buttons for key actions, and updated videos with closed captioning and written transcripts. This website redesign provides PG&E customers with disabilities webpages that have been enhanced to offer additional ways to learn more about Residential Rate Reform and ways they can better manage their energy usage. In addition, as a part of PG&E s 2014 General Rate Case, PG&E hired a disability access coordinator who is active in a wide variety of outreach forums that specifically target disabled customers. In PG&E s April 2016 report, 2015 activities included 67 external customer outreach events reaching over 18,000 customers to promote programs and services that could benefit this customer group, such as Medical Baseline, CARE, ESA, Third-Party Notification and worked to identify preferred bill formats for low vision and Braille. 66 There have been over 120 external customer outreach events in Such events to engage with disabled customers can and will also be used to provide awareness of residential rate changes and help them learn about programs, services, tools and tips that will help them manage their energy use. 65 What is in WCAG 2.0, Web Accessibility Initiative. October 19, PG&E s Annual Report on Activities and Spending to Promote Accessibility for 2015, filed April 26, p Events held through September 30,

77 VII. Statewide Marketing, Education and Outreach Campaign Plan The December 17, 2015 Assigned Commissioner and ALJ Ruling in this proceeding directed the IOUs to work with Energy Division and the ME&O WG to hire a consultant to advise the WG on appropriate ME&O metrics, goals and strategies to meet those goals. One of the objectives was specific to the coordination between Rate Reform ME&O activities and the Statewide ME&O Program (Energy Upgrade California), including how the messaging, campaigns and plans should be aligned. The Greenberg Blueprint did not provide recommendations for coordination between campaigns, but rather proposed a statewide campaign as part of the ME&O strategy, and a framework for collaboration, competencies, organization, and marketing automation. As a result, a significant amount of work remains to plan for coordination of the Statewide and IOU specific campaigns and refinement of the proposed topics discussed in this chapter. A. Alignment With the Greenberg Blueprint PG&E agrees with the following statewide campaign recommendations in the Greenberg Blueprint: 1. The statewide campaign should use messages that appeal to customers emotions by giving them both something to care about and something to connect with that is more personally meaningful than rates. 2. Statewide messaging should be repositioned from the ever-changing product mechanics of rate design to meeting California s climate goals of reducing Greenhouse Gas Emissions to 40% below 1990 levels by 2030, 68 achieving a clean energy future, and empowering Californians to take action. 3. Alignment, content, and timing are critical for success: We must prioritize the best possible customer experience, 69 and To connect with customers, the right message has to be delivered by the right entity at the right time, or customers will either not believe it or won t pay attention The Governor s Climate Change Pillars: 2030 Greenhouse Gas Reduction Goals. California Environmental Protection Agency Air Resource Board October 19, RROIR MEO Blueprint: Integrated Marketing, Measurement, and Alignment Strategic Action Plan for Residential Rate Reform and TOU_V2. Greenberg, Inc. August 19, 2016, p RROIR MEO Blueprint: Integrated Marketing, Measurement, and Alignment Strategic Action Plan for Residential Rate Reform and TOU_V2. Greenberg, Inc. August 19, 2016, p

78 B. Further Considerations Required for a Statewide Campaign While PG&E believes that a statewide campaign can be of value in engaging customers, three key issues need to be resolved before a final format for such a campaign can be determined: 1. Whether to use a rolling default approach, in which targeted information is provided to customers in accordance with their scheduled enrollment in TOU rates (as PG&E will propose for operational reasons), or the Greenberg Blueprint s assumed big bang approach, in which all customers are introduced to the key elements of Rate Reform at the same time, regardless of the timing of their enrollment. The CPUC has informally indicated that the IOUs should assume a rolling default, as the likely approach that the CPUC expects will be approved. Formal as well as confirmation details on the specific rollout schedule are still needed. 2. How to ensure alignment with and integration between Rate Reform and Statewide ME&O. PG&E believes a single campaign designed to support both the Statewide ME&O s needs and Rate Reform needs from a statewide perspective makes more sense financially and to support an optimal customer experience. 3. The percentage of customers who will be excluded from default TOU, after the CPUC makes its findings on unreasonable hardship to comply with Pub. Util. Code Section 745(c) (1) and 745(c) (2). 71 The CPUC s final decision on each of these three issues will affect the success of the Residential Rate Reform outreach and may influence decisions about when a statewide campaign should begin, the length of time in-market, the target audience, the focus of the messaging, and the appropriate size and allocation of the budget. C. Statewide Integration Recommendations It is important for the Energy Upgrade California Statewide ME&O campaign to integrate with any statewide Residential Rate Reform initiatives so that consumers understand the connection these programs have with the ultimate goal of a clean 71 D Decision on the Requirements of the California Pub. Util. Code 745 for Default TOU Rates for Residential Customers. September 15, Section 745(c)(1) identifies specific customer groups, such as Medical Baseline customers and customers who cannot be disconnected without an in person visit must be excluded from default TOU, but also allows the CPUC, in its discretion, to designate other customers who shall not be subject to default TOU without their affirmative consent. The findings the CPUC is required to make under Section745(c)(2), to ensure that any time-of-use rate schedule does not cause unreasonable hardship for senior citizens or economically vulnerable customers in hot climate zones may cause the CPUC to consider either making additional segments of customers ineligible for default TOU, changing the structure of the rate to remove any unreasonable hardship and/or changing the communications to affected customers that helps avoid impacts that might be deemed to constitute unreasonable hardship. -64-

79 energy future. It is critical that the IOUs be able to leverage statewide messaging and outreach to support local campaigns that are actionable and segmented by impact, solutions, and calls-to-action supporting rate plans and energy management choices. The messages and their timing must be crafted and coordinated to ensure the right message is delivered by the right entity at the right time. With careful attention to messaging and timing, PG&E can avoid such situations as: 1. Excluded customers thinking they are being defaulted. 2. Customers thinking that they are already on a TOU rate and altering their behavior prior to their default date, and then seeing no benefits reflected on their bill. 72 D. Marketing Consultant Recommendation Based on this discussion, PG&E recommends that the IOUs be authorized as soon as possible to issue a request for proposal and select a consultant to do the following: 1. Serve as an unbiased leader of the Rate Reform ME&O WG to facilitate the overarching statewide Rate Reform strategy. This role will include coordination, integration and alignment of various, sometimes disparate, points of view from WG participants. 2. Facilitate discussions between the Rate Reform ME&O WG, the Statewide ME&O WG, and the new Energy Upgrade California Statewide ME&O implementer (DDB). The Rate Reform ME&O consultant will be tasked with ensuring that the Rate Reform statewide needs and the Energy Upgrade California Statewide ME&O efforts being worked on by DDB are aligned from the start. The Rate Reform Statewide ME&O consultant will work with the two WGs to determine the best approach for ensuring alignment and coordination of objectives, messages, targeting, and budget 73 in order to achieve the desired outcomes. 74 With regard to statewide messaging, PG&E is concerned about the efficacy of the concepts in the Greenberg Blueprint. PG&E recently undertook customer research to identify opportunities for message improvement and examine alternate messaging 72 This could lead customers to stop their time shifting behavior prior to their scheduled default and miss seeing changes in their bills. While some amount of confusion may be unavoidable, PG&E would like to minimize the uncertainty and deliver the best possible customer experience to such customers. 73 The Statewide ME&O implementer s budget is approximately $68 million for the three-year period for ME&O during October 1, 2016 to September 30, 2019 per the contract filed in Advice Letter PG&E AL 3770-G_4939-E on October 17, PG&E is concerned about the efficacy of the Greenberg Blueprint s message concept and is currently conducting customer research to determine opportunities for improvement or alternate constructs. The results of this research will be shared with the WGs when available. -65-

80 constructs. Results 75 from a survey of PG&E s residential customers indicate that the Greenberg recommended statewide messaging is not as effective as alternate concepts in evoking positive attitudes towards thoughtful energy use and personal energy management responsibility. Similarly, the Greenberg Blueprint statewide messaging is not considered as strong in conveying the importance of planning for California s energy future. The research indicates that a healthy environment-based concept is more effective in terms of message clarity and encouraging positive attitudes towards reduced energy use, as well as a personal connection with electricity. These findings appear consistent across all three IOUs. Please see Appendix C for the results of this study. E. Statewide Budget Recommendation At the time of this filing, PG&E is unable to propose a budget for statewide Rate Reform activities, as any such budget will require resolution of the big bang versus rolling default approach, and an answer to the question of communicating to customers who are excluded from TOU rate changes. The budget also depends on the outcome of the engagement efforts PG&E is proposing for the Rate Reform ME&O WG, the Statewide ME&O WG, and the Statewide ME&O Program s stakeholders. F. Schedule Recommendation PG&E recommends that the process for selecting the Rate Reform statewide consultant begin immediately after the IOUs file their Residential Rate Reform ME&O plans. It is critical to start the RFP process in November, as the contract with the Statewide ME&O implementer was executed in October and on-boarding has begun. The current Energy Upgrade California Statewide ME&O schedule calls for the statewide implementer (DDB) to complete both the first Annual Joint Consumer Action Plan and the Five-Year ME&O Strategic Roadmap by February 28, 2017, for a campaign to begin in or about April In order to ensure integration between these two related statewide outreach projects, it is critical that an expedited RFP process for selecting the Statewide Rate Reform ME&O consultant be completed by the end of 2016, to allow them to start in January 2017, in time to participate in development of DDB s Statewide ME&O strategic plan. This expedited approach allows for more strategic and holistic integration of these initiatives, resulting in a more cohesive and effective plan; and more efficient use of time, resources and budget. Therefore, PG&E 75 TOU Statewide Messaging Concept Test Survey, Hiner and Partners, October

81 recommends the following high-level schedule for hiring a Rate Reform Statewide ME&O consultant and requests that the CPUC authorize the IOUs to proceed with the necessary RFP in November 2016, as follows: Activity Proposed Date Issue RFP 11/15/2016 Consultant Engagement January 2017 If this expedited schedule is delayed, there is significant risk that the current Rate Reform WG will lack the bandwidth and focus to ensure solid alignment and integration with the Statewide campaign and result in two campaigns running independently of each other creating customer confusion and lost cost-efficiencies. PG&E requests a timely decision on the recommendation to hire a consultant so that this component of Rate Reform ME&O can be resolved and the appropriate work can begin. VIII. IOU Marketing Plan A. Voluntary TOU Acquisition PG&E has two available residential TOU rate plans, ETOU-A and ETOU-B. Combined, they currently have just over 41,000 customers, and are growing at a rate of approximately 2,000 per month. 76 To date, PG&E has not conducted a campaign to market these rates to customers on PG&E s tiered rate Schedule E-1. However, for some customers, these TOU rates are an appropriate fit given their energy usage patterns and approach to energy, and may also represent a financial benefit compared to their existing rate. In the next couple of years prior to full roll-out of default TOU, PG&E proposes to embark on a campaign to increase voluntary enrollment on its existing TOU rates, with the aim of getting the right customers on the right rates and helping them succeed on those rates, while also managing outreach expenditures. The period between 2017 and 2019 presents an opportunity to provide positive customer experiences, begin to reduce load at peak hours, and provide critical learning about how to best improve customers knowledge, attitudes and practices regarding TOU rates and peak energy use. 76 In addition, as of September 30, 2016 there were 110,459 customers on PG&E s E-6 rate which was closed to new customers as of June 1,

82 In the period prior to the full rollout of default TOU, PG&E plans to pursue voluntary enrollment in available TOU plans. There is a set of clear business goals that comprise PG&E s rationale for pursuing voluntary TOU acquisition and informing the approach proposed below. These goals include: a. Provide positive customer experiences, particularly for low income customers: For those customers for whom adoption of TOU may represent a significant financial savings, or where the rate structure aligns with their energy attitudes and practices, or where they might not benefit financially on an eventual default rate they but could gain from early adoption of any existing TOU rate; joining a TOU rate early is likely to result in a positive customer experience. Such customers who choose to enroll, including low income customers, may experience the benefits of TOU for up to two years prior to when they would otherwise have likely been defaulted. For low income customers who benefit from TOU, but might be exempted from the default process, this is an opportunity to get on a financially beneficial rate. b. Reduce load at peak hours: Any customer who migrates to a TOU plan and responds to the price structure and rate education by shifting load away from peak times represents a win for the grid. Bill impact modeling discussed in this section suggests that some likely TOU rate early adopters are also significant household users of energy; the sooner PG&E begins communications on peak hour and load-shifting with them the better. Experiences at SMUD demonstrate that customers who opt-in to TOU rates provide approximately three times the peak load reduction of defaulted customers. 77 c. Identify TOU customer profiles and cost-effective acquisition strategies: Through early adoption of TOU rates, PG&E will begin to understand the customer profiles and experiences most appropriate to each TOU rate, and the most effective strategies, tactics and channels to communicate with customers regarding TOU rates, regardless of when and how they are migrating to TOU. d. Optimize TOU customer retention and rate success: In addition to other TOU pilots, PG&E will gain real-world experiences to inform how to best encourage customers to remain on the rate and support their success at managing their peak energy use, and thus their energy costs. The marketing objectives behind voluntary TOU acquisition can be summarized quite simply: cost-effectively get the right customers to enroll in PG&E s existing TOU rates and help them succeed on those rates. Specific objectives include: Identifying the customer segments most appropriate to acquire on these rates; Testing, refining and deploying effective and audience-appropriate acquisition strategies; and 77 Cappers, Peter, C. Anna Spurlock, Annika Todd, Patrick Baylis, Meredith Fowlie, and Catherine Wolfram. Time-of-Use as a Default Rate for Residential Customers: Issues and Insights. Lawrence Berkeley National Laboratory, June

83 Designing a suite of communications and other rate support touchpoints that encourage customers understanding of their new rate and success on the rate. These marketing objectives have value in achieving the specific business goals related to voluntary TOU described above. Also, along with PG&E s existing TOU Opt-In Pilot and the Default TOU Pilot described in this filing, it will provide real-world learning and concrete marketing approaches that can be adopted for the eventual default. Voluntary TOU acquisition represents a vital bridge between PG&E s ongoing Opt-In Pilot which is size-constrained (approximately 20,000 customers) and incentivized, and the Default TOU Pilot, which is not expected to start until March 2018, and which will primarily emphasize testing operational readiness and messaging on a limited group of approximately 250,000 customers. PG&E proposes to begin voluntary TOU acquisition marketing efforts in 2017, which provides a long enough time window before the full roll-out of default TOU to allow for varied iterations of strategies and tactics. PG&E can utilize lessons learned from the messaging and rate support suite it creates for voluntary TOU, and tests on those customers for a year or more to help ensure a successful roll-out of default TOU. As recommended in the Greenberg Blueprint, PG&E proposes to design voluntary TOU acquisition with impact-based segmentation, 78 and further, to overlay targeting strategy (impact) and messaging strategy (psychographics). 79 Like Greenberg, PG&E shares the hypotheses that bill impacts are the best predictor of how satisfied customers are likely to be on TOU rates. Therefore, outreach and targeting efforts should be based on the degree of bill impacts, thus customer segments, segments should be determined based on the degree to which their bill changes on TOU TOU Bill Impact Analysis PG&E used the last 12 months of interval data for each existing residential customer to model the cost differences of selecting any of our existing residential plans. This is similar to the rate calculations performed for the Residential Rate Comparison 78 RROIR MEO Blueprint_081916_v2, p RROIR MEO Blueprint_081916_v2, p RROIR MEO Blueprint_081916_v2, p

84 report, but includes additional rate options. 81 The calculations assume no behavior change. For those customers who are net-positive (demonstrating savings on at least one TOU rate), the distribution of customers whose best rate, financially speaking, is a TOU rate, is: Best Rate Best Rate Analysis (based on current rates) 82 Count % of Population Who Should Switch ETOU-A 1,096, % ETOU-B 1,112, % Total 2,208, % PG&E has approximately 2.2 million customers who would benefit to some degree by switching to one of its currently available TOU rates. As a note of particular focus, at least 60,000 customers would benefit financially from joining the current ETOU-B rate, but would not benefit financially on an ETOU-A rate. Twenty-six percent of these win now, lose later customers are CARE. Based on current customer usage, the breakdown of the impact on PG&E s residential population from switching to either of our existing TOU rates (ETOU-A and ETOU-B) is: 81 Customer counts in this section are limited by modeling constraints, particularly for customers with limited interval data, and should be taken as approximate. 82 Data current as of October 19,

85 Bill Impacts From Switching to a TOU Rate Today 83 (Annual Bill Impacts Based on Current Rates) % of Row Best Rate Is Impact Segmentation % of population 84 ETOU-A ETOU-B Benefiter 19% 13% 87% Non-CARE: savings of >10% or >$120 15% 14% 86% CARE: savings of >10% or >$60 4% 10% 90% Neutral (+) 26% 73% 27% Non-CARE: savings of 0-10% or $0-$120 19% 77% 23% CARE: savings of 0-10% or $0-$60 7% 61% 39% Neutral (-) 25% Non-CARE: bill increase of 0-10% or $0-$120 17% CARE: bill increase of 0-10% or $0-$60 8% Non-Benefiter 3% Non-CARE: bill increase of >10% or >$120 1% CARE: bill increase of >10% or >$60 2% For these customers, their best rate is their existing rate Due to the existence of two available Opt-In TOU rate structures, and given typical bill sizes, Benefiters are heavily concentrated on ETOU-B. For voluntary TOU outreach efforts, PG&E intends to target primarily customers who will experience perceptible and significant bill savings over tiered rates on an annual basis. 85 However, the threshold at which bill savings become significant to a given customer is still to be defined, especially for the low income customers described below. PG&E hypothesizes that this threshold will depend on a number of factors including, but not limited to: energy burden, audience psychographics, and demographics, like personas and customers orientation toward cost savings versus pro-environmental behaviors. Customer responsiveness to initial voluntary TOU outreach and subsequent PG&E analysis of rate changes and rate performance will inform modifications to our impact thresholds and targeted outreach. 83 Data current as of October 24, Note that percentages do not add to 100% of PG&E residential population due to inability to model bill impacts for customers without sufficient electricity usage data. 85 RROIR MEO Blueprint: Integrated Marketing, Measurement, and Alignment Strategic Action Plan for Residential Rate Reform and TOU_V2, Greenberg, Inc. August 19, p

86 2. Benefits of Voluntary TOU for Certain Low Income Customers PG&E disagrees with the Greenberg Blueprint recommendation that voluntary TOU acquisition be confined to higher income customers who have the ability and wherewithal to manage their finances throughout the year. PG&E find this statement highly generalized and not indicative of the diversity within our low income population. Indeed, 38% of PG&E s CARE customers more than 500,000 customers are net-positive (that is, benefit financially from a TOU rate) absent any behavior change, equivalent to the percentage in our overall population. In fact, as the table below shows, 18% of PG&E s CARE population, more than 235,000 customers, are TOU Benefiters, with a full 9% surpassing an assumed threshold of positive high impact. Impact Segment Neutral-Positive (+) (Savings of 0-10% or $0-$60) Benefiter (Savings of > 10% or >$60) Further Subsets of Benefiter CARE Customers Whose Best Current Rate Is TOU 86 Count % of CARE Population % on ETOU-A % on ETOU-B 375,704 28% 17% 11% 235,147 18% 2% 16% High Positive Impact (>10% and > $120) Significant Benefiter (> 20%) 121,867 9% <1% 9% 32,773 2% <1% 2% The energy burden among PG&E s low income population varies significantly. Some lower income customers absorb and pay large energy bills each month, and presumably the marginal impact of a $10 or 10% increase to them is different than a low-bill peer. In fact, PG&E has identified at least 45,000 CARE customers whose monthly bill is greater than $200. Of those higher-bill CARE customers, 65% would benefit from shifting to one of PG&E s existing available TOU plans, with more than half of those customers saving more than $200 annually. PG&E believes it is very important that these customers be made aware of the TOU rates that would provide them with this relief. Therefore PG&E proposes to include such low income customers in its proposed voluntary TOU acquisition campaign. 86 Data current as of October 24,

87 3. Customers Who Can Win Now But Would Lose on Default TOU It is possible that the final default TOU rate may resemble ETOU-A consistent with D s directive for an initial TOU-Lite rate. With the current rate structures, approximately 60,000 residential customers benefit financially from migrating to ETOU-B, but would be negatively impacted by migrating to ETOU-A. In other words, these customers win if they join TOU now on their own terms, but lose if they join later during the default. PG&E believes that the Company does these customers a disservice if they are not presented with ample opportunity to elect the TOU rate plan most appropriate for their energy usage : Emphasis on ETOU-B As illustrated below, in 2017 PG&E is proposing to focus voluntary TOU outreach on customers whose best rate is ETOU-B, particularly CARE and other highly-impacted customers. The targeted customers not only have the largest financial impetus to join a TOU rate early, but under a default scenario they will likely either be excluded (CARE) or moved to a rate not as beneficial for them. SEGMENT CARE ETOU-B Benefiter CARE ETOU-B Neutral Positive DEFINITION CUSTO MER TYPE APPROX. COUNT 87 Savings of > 10% or > $60 annually CARE 140,000 Savings of 0-10% or $0-$60 annually CARE 135,000 Win-on-ETOUB, Lose-on-Default Gen Pop ETOU-B Benefiter Savings of >0% annually on E-TOU-B but <0% on E-TOU-A Savings of > 10% or > $120 annually <4 months High Usage Surcharge Both 60,000 Gen Pop 600,000 PG&E will continually monitor the adoption rates of the over one million customers projected to benefit from voluntary TOU rates (in the chart above) and will revise the targeting priorities accordingly. If PG&E expects to reach the cap of 225,000 customers, a request for a higher cap may be requested in PG&E s GRC Phase 2 or 2018 RDW : Addition of ETOU-A In the second year of voluntary TOU outreach, PG&E proposes continuing to target customers identified in PG&E will utilize knowledge gained in our initial efforts, as 87 Data current as of October 24,

88 well as insights from the Residential Rate Comparison report, Opt-In TOU Pilot, and ongoing organic rate sign-ups, to further refine this audience. For instance, PG&E may uncover bill impact thresholds or marketing tactics that yield higher acquisition and retention rates or lower cost-per-acquisition rates. In addition, in 2018 PG&E anticipates adding to the targeted audience customers whose best rate is ETOU-A. These include CARE customers who may be excluded from the default, as well as general population customers who may have a significant motivator to join ETOU-A, and would be electing to do so perhaps more than a year prior to their default date. Note that the population sizes in these segments are smaller than those from 2017 because of how rate structures interact with energy use and bill size. SEGMENT DEFINITION CUSTOMER TYPE APPROX. COUNT 88 All Those Not Converted From 2017 Additional waves of outreach for same customers with targeting adjusted based on 2017 learning CARE ETOU-A Benefiter Savings of > 10% or > $60 annually CARE 22,000 CARE ETOU-A Neutral Positive Gen Pop ETOU-A Benefiter Savings of 0-10% or $0-$60 annually Savings of > 10% or > $120 annually <4 months High Usage Surcharge CARE 230,000 Gen Pop 115, Marketing Messages and Strategies For voluntary TOU acquisition, where the principal target segments are Net- Positives and Benefiters on TOU rates, financial messages (i.e., probable savings) are likely to resonate with customers. However, only through experience in the first phases of this acquisition, plus the residential Rate Comparison Report, will it be possible to better discern the thresholds at which financial messages resonate and result in plan switching, which is expected to vary across income groups and psychographic personas. Meanwhile, PG&E believes it is important to utilize messages that appeal to EQ as well as financial IQ, as recommended by the Greenberg Blueprint. This means 88 Data current as of October 24,

89 communications frames that emphasize community benefits, convenience and positive environmental returns, for example. In PG&E s ongoing fall 2016 Residential Rate Comparison report test and learn, PG&E is comparing customer s level of engagement given three distinct messaging frames: financial, responsibility and environmental. PG&E will also conduct customer research with several marketing concepts that are in development for voluntary TOU acquisition, to identify the overall campaign approach that is clearest and most impactful for our customers. Below is an example of how distinct messaging approaches can be tested and utilized with distinct customer segments the two persona clusters mentioned are predominant amongst PG&E s ETOU-B net-positive target audience. CLUSTER PERSONAS FINANCIAL MESSAGES, E.G. Cool & Connected Needs First Gadget Family Way Wired Beyond Their Means Living for Today Heart & Home - There are new ways to pay for energy - More control over your energy statements - Lower your monthly statement - Keep more of your hardearned money for what matters NON-FINANCIAL MESSAGES, E.G. Cutting Edge - Be an early adopter - Use information to your advantage Societal - Join other Californians to meet our shared goals - Preserve our resources for future generations 7. Marketing Tactics a. Acquisition Tactics Campaign tactics for voluntary TOU acquisition take into consideration what has been successful from PG&E s prior customer communications, learning from other utility experiences in other states, and our understanding of the target segments. Overall, the outreach includes a combination of direct marketing, targeted digital media, and some limited social and traditional media. The majority of PG&E s outreach that is under consideration is direct marketing direct mail, and outbound phone calls. These tactics ensure that the right message gets in the hands of the right customer, and they allow PG&E to personalize messages to the financial benefits and best-rate for a given customer. Wherever possible, and cost-efficient, these messages will be personalized to the customer, including their current rate plan, their best rate and their energy usage. Where possible, -75-

90 PG&E intends to use an -based lead nurturing approach, to support customers who may have opened or clicked an , placed a call, or visited the website, only to drop off during the process of selecting a new rate. In both 2017 and 2018, the voluntary TOU acquisition campaign aligns with the delivery of a Residential Rate Comparison report. 89 The Residential Rate Comparison will be a reinforcing communication, providing to customers who would be net-positive on our existing TOU rate plans a clear statement that a TOU rate may be better for them. In order to increase the frequency of exposure to TOU messages, ensure complete coverage, and reach target segments in channels customer respond to, PG&E will consider using targeted digital (display, social, and native digital with content-rich blog sites related to energy use and savings). The digital channels allow for highly focused targeting, where PG&E can use first-party data, such as address or visits to our website, to deliver content and retargeting to just those customers who are in our acquisition target segments. The campaign will also provide PG&E with the ability to use look-a-like data in social media to expand to customers very similar to our target customers, which may prove especially valuable once initial outreach shows those customers with a propensity to join and succeed on a TOU rate. PG&E can also specifically target customers who are making purchases, researching, or otherwise engaging with relevant topics, such as household energy management, smart home and family budgeting. b. Retention Tactics The initiative described here is not only for acquisition, but also seeks to facilitate customer retention and success on the TOU rates once a customer has joined. To this end, PG&E is developing a new, print welcome kit that provides customers with the most critical information regarding their new rate. In partnership with our programs, PG&E is developing a testing plan to identify the post sign-up series of communications that will deliver the most positive customer experience, encourage retention, and support load-shifting behaviors. Initially, PG&E proposes to develop an 8-week supporting communication, in both direct mail and format, which will be delivered to customers after two complete billing cycles. This would be followed by seasonal 89 Required as part of D and the July 22, 2016 ALJ Ruling on Rate Comparisons. (Rate Comparison Reports are further discussed in Chapter 8.) -76-

91 communications, alerting customers to the change from winter to summer bill rates, and accompanying tips and programs, and vice versa. Based on the results of the testing planned to be conducted during initial outreach in 2017, PG&E may also recommend an ongoing (e.g., monthly) sequence of communications and feedback to customers. In all post sign-up communications, the objective is to deliver as much personalized content as possible, including where feasible, references to a customer s usage and savings on their TOU rate and provide recommendations based on monthly usage rather than annual usage. 8. Risks and Open Issues By taking a phased approach and prioritizing customers with a clear financial benefit from joining a TOU rate, PG&E s plan reduces the risk of customer dissatisfaction. Indeed, as described in the objectives of this section, voluntary TOU acquisition is a method to improve the customer experience by getting customers on the most appropriate rate for them sooner, rather than later. One risk to the success of this initiative, at scale, will be the eventual cost-per-acquisition. PG&E believes the budget indicated for these efforts is justified to achieve the benefits resulting in acquiring customers onto a voluntary TOU rate prior to default in See Chapter XI for further detail on PG&E s proposed budget. However, should the costs required to contact, acquire and retain customers on the existing TOU rates prove higher than expected, PG&E would need to re-evaluate the value and viability of this voluntary TOU acquisition project. Until PG&E enters Phase 1 and document not only true costs but also conversion rates, cost-per-acquisition is a speculative exercise. Another risk for the success of this effort would be significant changes to the structure of the available TOU rates. These could include material changes to price per kilowatt-hour on these plans, alterations to the hours of TOU for either plan, or the availability of either plan for customer enrollment. Any of these changes would impact the target segments, but would also pose a serious risk for customer dissatisfaction. B. Default TOU Outreach In accordance with D , PG&E is preparing to transition eligible customers to a default TOU rate in The ME&O plan has been developed utilizing PG&E s in-market data and experience executing previous ME&O, the Greenberg Blueprint, -77-

92 learnings from other TOU initiatives, including SMUD, 90 and PG&E s hands-on experience from the relatively recent successful transition of SMB customers to mandatory TOU rates in recent years. 91 Two rigorous pilots are taking place prior to 2019 to help inform this large and critical undertaking. The following ME&O plan for default TOU will be modified with learning and results from these pilots as they become available, and results from PG&E s other ME&O efforts in 2017 and PG&E s approach for default TOU is to design an optimal customer experience. Based on information provided to the IOUs on operational constraints, and in consultation with the TOU WG, the ALJ advised that the IOUs should assume a rolling or phased default, not a big bang. The ALJ confirmed at the September 12, 2016, ME&O workshop that a rolling default should be assumed for the IOU s ME&O plans. Based on current projections, primarily from an operational standpoint, PG&E currently believes that about 500,000 customers can be successfully transitioned to TOU within the period of a month. Ongoing analysis will help determine how best to transition eligible customers to default TOU for their optimal experience, including awareness lead times, operations, etc. The outreach plan will be modified once the final default strategy is determined. In line with the Greenberg Blueprint, PG&E recommends avoiding transitioning customers during higher bill periods, including summer (June-September) and winter (January-February). By avoiding these periods, customers have more time to learn about the rate plan and ways to save prior to higher priced months and more extreme weather conditions. This will help mitigate dissatisfaction, optimize call center experiences, and help avoid customers wanting to immediately get off the rate after being placed on it. In addition, PG&E concurs with the Greenberg Blueprint that transition should be avoided during the winter holidays when messages may be missed due to the overwhelming amount of marketing clutter during the season. The table below is one possible scenario for rolling default timing, such as depending on when the CPUC s final 2018 RDW decision is issued. The chart is a visual representation of how 90 Smart Grid Investment Grant, Time-of-Use as a Default Rate for Residential Customers: Issues and Insights, June D (modifying D and D ) approved November 10, 2011 in PG&E s 2009 RDW Application (A ). In D the CPUC approved a rolling default schedule for SMB customers over several years, beginning on November 1,

93 a waves approach could be implemented. Each wave would include up to 500,000 customers and would occur every month during the default implementation except the months of January-February (to avoid already highly impacted times for the call centers and higher bills) and June-September (where prices and usage tend to be higher). The waves would begin after final approval of the default plan filed through an RDW 92 and would continue until all eligible customers are defaulted. The following three objectives have been defined for the default TOU marketing plan to support an optimal customer experience: a. Drive awareness and understanding of rate options, default TOU and when customers need to take action to opt-out if they choose to do so; b. Drive awareness within certain customer classes that they can choose not to participate in default (Pub. Util. Code Section 745); and c. Provide ongoing education about TOU rate plans and how to be successful on them, including ways to conserve as well as shift usage away from the peak periods. 1. Segmentation As noted in Chapter III, PG&E currently assumes impact-based segmentation will likely consist of Benefiters (customers who will certainly save on default TOU), Neutrals (customers likely to have negligible bill impacts on default TOU), and Non-Benefiters (customers likely to see bill increases under default TOU if they make no changes in behavior). In contrast with the Greenberg Blueprint, Non-Benefiters may be further segmented into just two micro segments: Mild Non-Benefiters and Extreme Non-Benefiters. PG&E does not believe that the five microsegments recommended in the Greenberg Blueprint are necessary given the mild price differentials in the default 92 D OP 9 directs PG&E to file a RDW Application no later than January 1, 2018, proposing default TOU rate for residential customers. -79-

94 TOU rate. In addition, a key consideration when assessing bill impacts will be energy burden, defined as the level of energy cost relative to household income, as well as bill volatility; both these factors will be incorporated into any impact model. Secondarily, customers may be segmented based on their geography, in-language dependence, and program participation, age or designation as low income. Additional considerations will be made to further leverage psychographics/persona groupings and load profile-based segmentation, such as adding a layer of large electric usage during peak hours. The added segmentation layers might change during various stages of pre- and post-default. Also, the attributes included and the final segmentation approach will be carefully considered to ensure there is sufficient value from a messaging perspective to warrant the extra cost and complexity associated with additional versioning. The segmentation approach will be tested in the default pilot and finalized prior to the 2019 default to TOU rates. Impact Segmentation 93 % Customers (Summer Avg) # of Direct Touches Outreach Start Date Benefiter Decrease of > $10 or 10% (non-care) 1.51% 2 60 Days Decrease of > $5 or 10% (CARE) 0.14% Neutral (+) Decrease of $0 -$10 or 0% -10% (non-care) 1.78% 2 60 Days Decrease of $0 - $5 or 0% - 10% (CARE) 0.21% Neutral (-) Increase of $0-10 or 0% -10% (non-care) 59.03% 2 60 Days Increase of $0 - $5 or 0% -10% (CARE) 42.01% Mild Non-Benefiter Increase of $10 - $20 or 10% - 20% (non-care) 22.25% 4 Increase of $5 - $10 or 10% - 20% (CARE) 24.55% Non-Benefiter Increase of > $20 or 20% (non-care) 15.24% Increase of > $10 or 20% (CARE) 33.10% Up to 120 Days Up to 120 Days 93 This data analysis was performed on October 3, 2016 for a representative sample of accounts and is based on dollar ($) impacts only. While it is expected that the percentages in this analysis will remain consistent, PG&E will re-run the analysis to include both dollar ($) and percent (%) impacts for the target population prior to execution of customer outreach. 94 May include: Interactive Voice Response System, telephone outreach to customers or telephone town hall. -80-

95 2. Marketing Strategy PG&E will target customers by bill impact which may result in increased touches and overall outreach for most impacted and hard-to-reach customers, similar to what is recommended in the Greenberg Blueprint. Customers will be provided with personalized, actionable information so they can become educated about the rate, the possible impact on their bills, available tools and solutions to help manage bills, and encouraged to make an active choice (even if that means they decide to take no action). PG&E will use results and learning from pilots, voluntary acquisition, and customer research to modify the initial default ME&O plan to achieve marketing objectives while utilizing the most efficient and cost effective outreach methods. PG&E plans to concentrate on direct-to-customer outreach which allows for personalized impact information including varied urgency and encouragement to take action. While the Greenberg Blueprint recommends mass media, PG&E is instead proposing to utilize mostly direct to-customer outreach. This will allow for a more cost-effective, efficient and targeted campaign. The use of mass media would generate a lot of waste and likely cause customer confusion because the rolling default is expected to take place over the course of a full year. PG&E doesn t want customers to think they are on the rate before they are physically transitioned to it as would happen for many customers with a mass media approach. This is similar to the approach PG&E used with its successful SMB default TOU transition. a. Direct to Customer: Customers will receive a direct mail or an on-bill notification for their primary communications about default. Customers who have not indicated a preference will receive a direct mail notification. The current plan for direct mail is to start notifying customers of the upcoming transition up to 120 days out for the most impacted customers and leading up to 60 days for Neutral and Benefiters. PG&E proposes to test various outreach scenarios during the Default TOU Pilot to help determine the most effective way to notify customers during default to TOU. This will include timing of communications as well as the type of communications (simple notification versus rate comparison report). As this is tested and results come in, the plan will be modified to optimize the customer experience. This recommendation is similar to what was suggested by Greenberg, though PG&E is recommending additional types of direct mail treatments as part of its Default TOU Pilot and may or may not ultimately recommend the same cadence as the Greenberg Blueprint. Depending on impact level some customers may receive in addition to or, in some cases, in place of direct mail as the primary means of outreach. The cadence of direct mail and communications will be determined based on outcomes being tested during the Default TOU Pilot to achieve maximum -81-

96 awareness and understanding of the default TOU rate with most cost-effective channels. b. Telephone Town Halls: This tactic, experimented with during early stages of Rate Reform, may be employed for customers as a way to educate them about default and provide a more in-depth educational session for customers that choose to participate. Telephone Town Halls work well with customers who prefer a live discussion versus printed content, as well as with who have less flexibility to visit local offices or CBO events. This tactic also provides the ability to communicate in-language with customers who have limited English proficiency. c. Digital Media: PG&E is evaluating targeted digital (search, display, native and retargeting) to drive awareness of the default with affected customers. The ability to leverage this tactic depends on how PG&E ultimately defaults customers. This recommendation differs substantially from the Greenberg Blueprint which recommended significant levels of mass media that would complement a big bang default and did not take into account complications with mass media that would result from a large percentage of customer exclusions. The traditional mass media approach as detailed in the Greenberg Blueprint would create budget inefficiencies. It would also likely cause customer confusion regarding default TOU because the messages would be difficult to target both from a timing and audience perspective. d. Community-Based Outreach: PG&E plans to employ a comprehensive person-to-person outreach strategy in the form of co-sponsored events via community partners. This will aid in outreach to hard-to-reach, in-language and other vulnerable communities that are still a part of default. Further details on this direct outreach can be found in Chapter IX. 3. Exclusions and Considerations for Specific Customer Groups Statutory exclusions from default TOU are all of the following: (1) Medical Baseline customers; (2) third-party notification customers; and (3) customers who require an in-person visit from a utility employee before disconnection. It is also possible that the CPUC could order further exclusions, such as, certain CCA customers, certain Senior households, customers within a specific energy burden threshold, certain CARE and/or low income or hard-to-reach customers, etc. 95 Such possible additional exclusions, if 95 D , approved by the CPUC on September 15, 2016, included certain requirements for Pub. Util. Code Section 745 for default TOU rates for residential customers. The decision interpreted and set definitions for many of the terms in Section 745, such as the definitions of economically vulnerable customers and Seniors. However, the decision points out (on page 32) that the remaining Section 745 issues fall into two broad categories which will likely be addressed in separate decisions. First, the CPUC must resolve operational and technical issues, such as those identified in the Section 745 Matrix. Second, after data has been collected, the CPUC must make findings as to whether and how to meet Section 745(c)(2) requirement of preventing unreasonable hardship from by default TOU rates. -82-

97 any, are being explored and will be determined later in the RROIR proceeding after the CPUC makes its findings on unreasonable hardship under Pub. Util. Code Section 745(c)(2). The final outcome of any such CPUC decision will need to be factored into PG&E s final outreach plan, which may need to be modified, accordingly. 4. Messaging Approach Prior to default awareness communications, PG&E will have collected insight on tactical approaches as well as message effectiveness through three primary activities: 1. Opt-In TOU Pilot 2. Acquisition campaign for existing voluntary TOU rates 3. Default TOU Pilot Given this, the example messaging structures for default and post-default communications, below, will be strongly influenced by insights not yet obtained. Example Default Messaging Structure (still to be tested) Segment Up to 120 Days 90 Days 60 Days 30 Days Benefiters/ Neutrals Non- Benefiters n/a Driving awareness/building urgency: TOU details, this change could impact you, review your rate options and choose the best rate for you n/a Driving awareness/building urgency: TOU details, this change could impact you, review your rate options and choose the best rate for you General awareness: A change is coming, basic default detail, review your rate options and choose the best rate for you Driving awareness/high degree of urgency (Follow-up): Action recommended: TOU details, this change could impact you, review your rate options and choose the best rate for you Awareness/Education: Your new rate is coming in 30 days. See how you can be most successful on this new rate. Awareness/Education: Your new rate is coming in 30 days. See how you can be most successful on this new rate. Audiences will receive anywhere from two to four direct touches in the period of up to 120 days as shown above, primarily based on level of impact but also to accommodate for communications challenges such as those customers who are billed through their bank and do not receive their paperless bill directly from PG&E, and customers whom the Company may not have an on file. Therefore, those customers would receive direct mail. The assumption is that default specific messages will be deployed immediately following or within the same timeframe as other support messages such as the statewide campaign and the always-on campaign that consistently runs throughout the year. As such, PG&E feels the proposed level of default communication is appropriate, and not likely to create fatigue. PG&E will -83-

98 evaluate this cadence when the Opt-In TOU Pilot, acquisition campaigns and insights are analyzed. 5. Pre-Certification of Ineligibility for TOU PG&E seeks to drive awareness with customers whom the CPUC determines are ineligible from TOU default to enable them to certify their status and facilitate their exclusions from default. These customers may include hard-to-reach customers including income qualified, CARE/FERA and Seniors over 65+. PG&E will seek to reach these customers through automated calls, community-based outreach, and monthly billing statements. 6. Post-Default Retention Communications Once customers have defaulted onto their new rate plan, PG&E will conduct multi-channel campaigns designed to continue driving awareness, understanding and engagement on their new rate. Customers will receive a new rate welcome communication once they have transitioned. It will reinforce the rate change, provide further information about the rate, and tips on how they can shift and reduce electricity usage. Customers who are forecasted to be negatively impacted during the higher energy use summer and winter seasons will receive additional outreach with tips tailored to energy reduction for hot or cold weather. Customers will be provided with education on PG&E s programs, services, and tools that will further their ability to manage their energy use through residential rates outreach efforts and integration efforts with PG&E s other offerings. The Opt-In and Default TOU Pilots along with the TOU acquisition campaigns will be testing various messages and tactics to help customers stay on and be successful with TOU rates. These campaigns will directly inform post-default communications strategies and messages, in addition to other forms of customer research. For Non-Benefiters who will need to actively change behavior to save or stay neutral on the default rate, PG&E will likely need to maintain a cadence of tips and assistance to help them conserve and shift. For Benefiters and Neutrals, the motivations to shift and/or conserve may need to be handled differently. They may not be as motivated as they are not feeling an increased burden on the default rate (and may benefit naturally) and therefore may not be willing to undertake the work involved in load shifting away from peak hours. More insight is needed on this audience to determine the best ways to -84-

99 engage them in load-shifting. Some such insights will be provided by the voluntary TOU acquisition campaigns. C. Support Channels 1. PG&E s Approach to Marketing Integration Since 2014, PG&E has ensured customer outreach efforts regarding Rate Reform are integrated into strategies for CARE, Energy Efficiency, Demand Response programs as well as others, as appropriate. 96 The approach to Rate Reform integration was built on a foundation that has been successfully in practice for several years, within PG&E s marketing department. This section will first review PG&E s general marketing outreach approach and how integration has been overlaid, for many years, to create a blueprint for use with multiple products, services and messages including Rate Reform. The section will then provide a review of future plans for marketing integration. With all ME&O, PG&E s objectives are to: 1. Inspire and empower our customers to take action to help lower their bill or energy use; 2. Position PG&E as our customers trusted Energy Advisor; and 3. Increase customer engagement with PG&E s various portfolios such as rate plan options, tips and programs while meeting program participation and energy management goals. PG&E plans to continue utilizing the following strategies in ongoing efforts to achieve our integration objectives: 1. Establish and nurture relationships with customers to drive ongoing customer engagement and higher product adoption over time; 2. Lead customers on personalized journeys that make sense for their energy/bill management; and 3. Evaluate integration opportunities to provide holistic solutions and deliver an optimal customer experience and return on investment. a. Integration Considerations For more than five years, PG&E has focused on integrating marketing efforts across many of our programs and services. As with all of our marketing outreach, data is leveraged in the decision-making process to determine which customers to target, the segmentation tools to utilize, which messages will be the most motivational, and what 96 PG&E will be incorporating rate reform related integration into the CARE and ESA program marketing plans per the low Income PD/APD still to be voted out by the Commission and into PG&E s Energy Efficiency Business plans to be filed January 15,

100 channels will be the most efficient. When looking to integration and how to best approach it, the following considerations are examined: 1. Customer: Determine whether the inclusion of multiple messages will make sense to the customer when presented together, and motivate them to take action(s) in response to the information while supporting a good customer experience. 2. Communication Objectives: Ensure that integration will allow for effective communication of multiple ideas without detracting from the main message/ need for the communication. 3. Channel: Determine which channel(s) supports the ability to effectively present multiple messages. 4. Test/Learn/Optimize: Ensure that there is an opportunity to learn from the integration initiatives (test) and that the data supports the next steps/direction to focus the integration (learn/optimize). b. Examples of Prior Integration Efforts 1) Energy House Calls This video series 97 is an ongoing integration initiative. It was created in 2012 and has resulted in the production of 34 videos that have received over 1.3 million views. 98 The videos were created to focus on a variety of solutions for managing a customer s energy and bill. The opportunities showcased in the videos were designed for customers looking to make small, medium or larger changes and how to successfully do so. In addition to energy efficiency tips and easy steps the customers can take on their own, the videos also focus on incorporating different PG&E programs and services such as SmartAC (Demand Response), Energy Efficiency rebates, solar (Distributed Generation both NEM and solar water heating), CARE and the ESA programs. 2) Residential Digital Newsletter The monthly newsletter presents integrated messages in an easy, engaging and digestible format for the target audiences. The newsletter is segmented by key demographic/psychographic information and data regarding previous engagement into four versions: Best Prospects: Customers with energy efficiency opportunities who have engaged with PG&E before; Data as of September 10, 2016, based on all Energy House Call video views. -86-

101 Barrier Prospects: Those with energy efficiency opportunities who have not engaged with us; Limited Prospects: Those with low energy efficiency opportunity such as renters, gas-only, and low bill customers; and Low Income: Those with energy efficiency opportunities that have income limitations. This degree of segmentation allows PG&E to present integrated, relevant ideas and solutions in the form of energy and money savings tips. Since the newsletter launched in 2013, PG&E has consistently grown the customer base that elects to receive such communications and has increased the engagement with the newsletter in both customers who are opening the s and clicking on the content to learn more. 3) Hot Days Promotion Since 2007 PG&E has worked to drive customer participation and engagement with our SmartRate and SmartAC programs. Both programs help customers to reduce load on the hottest days of the year. SmartRate offers customers an ongoing financial incentive for participation and SmartAC offers a one-time rebate for joining. Beginning in 2009, the marketing team began to cross-sell the programs. This meant that after a SmartRate customer was acquired, they would receive a SmartAC promotion (assuming they had an air conditioning unit) and vice-versa. In 2014, PG&E elevated the sequenced promotion of the programs and tested integrated co-promotion. PG&E believed that bundling these programs together would make a more seamless experience for our customers by reducing the effort needed to respond. Overall the results of the test reinforced that the integrated promotion made sense from a return on investment perspective. Customers were much more likely to sign up for the programs together than separately. However, the experience on the backend wasn t as seamless as the enrollment process. SmartRate can be applied to a customer s account within a few days, but the SmartAC installation can vary which resulted in a less than ideal customer experience. To support an optimal customer experience the results of this test led PG&E to continue to cross-sell the programs versus bundling them together. c. Examples of Residential Rate Reform Integration Initiatives Leading up to and following the issuance of D in July 2015, PG&E has continued the integration initiatives. The Rate Reform communications PG&E has -87-

102 created have focused on upcoming changes and have been coupled with solutions that can help customers manage their energy use and bill. In addition, PG&E has been testing the integration of Rate Reform messaging in program specific marketing to determine if it helps drive deeper engagement with the programs. Some key examples of these integration initiatives include: 1) Rate Reform Rate Increases October 2014 The communications effort was targeted to customers who were impacted by various rate changes/increases in 2014 including the first Rate Reform impacts. High impact customers, defined as a monthly impact of 10% and $10 for CARE and 10% and $20 for non-care, were the key recipients. The communication educated customers about rate changes and offered them information about targeted programs, tips and energy management solutions to help them lower their bills. PG&E segmented the audience based on income and current program participation in CARE, ESA or SmartRate to provide the most relevant solutions to customers. This was an excellent opportunity for integration as it allowed PG&E to tell customers about changes, but then also presented ways to help them manage their energy use and bill amounts through the changes. The objective for the Rate Reform communication was aligned with the promoted program objectives of helping customers to save energy and money. Also, PG&E chose to use direct mail because it allowed for a more detailed explanation of programs and tips. PG&E saw a 2% increase in program participation among the target audience and have leveraged this model for several subsequent Rate Reform communications. 2) Seasonal Campaigns 2014-Present Since the summer of 2014, PG&E has executed targeted campaigns promoting energy savings solutions, tips and programs to customers that are likely to see a high bill impact during the hottest and coldest times of the year. PG&E s summer campaigns have included direct outreach efforts including and direct mail to customers likely to have the highest bill impacts and overlaid targeted media-radio, digital and social media-in highly impacted areas to reinforce the direct communication message and reach audiences that would still feel the effects of summer heat on their bills. In these communications, customers were reminded that the heat of summer could mean higher energy use and bills, and were directed to pge.com/summer to find more targeted -88-

103 solutions for energy and money savings with programs like ESA, CARE, SmartRate, SmartAC, etc. The 2015/2016 winter campaign also focused on targeting customers with high bill impacts as well as all customers in Tier 1 and Tier 2. The tactics for this initial winter outreach were limited to direct channels only and provided customers with more detailed information about Rate Reform along with energy efficiency tips and targeted programs, like Home Energy Checkup, CARE, ESA and Balanced Payment Plan, that could help customers better manage their use and bills in the winter. As the 2016/2017 winter campaign approaches, PG&E will model the channel selection after the past summer campaigns to drive greater engagement for customers in higher impact areas as well as among the most impacted customers. Available data has indicated that a high population of low income and Hispanic customers is likely to be impacted in the summer and winter periods. As a result, many of the campaign materials are bilingual (English/Spanish). The call-to-action in all of the seasonal campaigns drives customers to areas of pge.com where they can find more information on programs, tips and tools that will help them save energy and money as well as information on Rate Reform and what s changing. 3) Communities of Colors Integrated Campaign Throughout 2015, PG&E conducted a campaign specifically targeted at in-language and diverse customers via their distinct media channels. The acculturated campaign messages provided various simple and no-cost ways for customers to save energy and money and drove them online to engage in even more tools and solutions such as SmartRate, online account, CARE, ESA Program, etc. Customer targets included the Hispanic, Chinese, and Vietnamese, Filipino, Asian Indian, Japanese/Pan Asian, African American and Hmong communities and included TV, radio, print and digital advertising as well as direct mail and to key geographies with high concentrations of the target customer audiences. 4) Program Integration of Rate Reform Messages Since early 2016, PG&E has focused on integrating Rate Reform information into targeted program marketing. In keeping with the test, learn and optimize approach that PG&E outlined above, PG&E has tested both the integration of the Rate Reform message within the primary communication about a program, as well as adding a separate section to program communications that independently speaks to Rate -89-

104 Reform. With these two integration methods, PG&E is working to determine whether inclusion of the Rate Reform message increases a customers engagement with the program or with their desire to learn more about what is changing as it relates to Rate Reform. Thus far, testing has resulted in an equal level of engagement with the program specific message, nominal increased interaction with the Rate Reform messaging and a slight uptick in unsubscribing/marking the communication as spam over the control version in the case of one . PG&E plans to continue to test and learn to determine the most effective way to integrate messages and drive customer engagement. 5) Additional 2016 Rate Reform Integration Examples a. Residential Digital Newsletter The monthly Energy Advisor residential digital newsletter continues to promote a variety of energy and money savings solutions to targeted customers as well as including messaging related to Rate Reform. b. Low Income Integrated Brochure This brochure features multiple programs including: CARE, ESA and Balanced Payment Plan, among others and services such as Relief for Energy Assistance through Community Help (REACH), Third-Party Notification for low income audience as well as messaging related to Rate Reform. c. Employee, Affiliate and Contractor Reference Guide This tool was created to provide an overview of several key residential programs and how they can be discussed with customers in a one-on-one conversation. Updates to this piece in 2016 further integrated messaging on Rate Reform so that various PG&E employees and representatives who interact with customers can also address it with customers as needed. d. Pool Pump Rebates An integrated Rate Reform message was included in outreach efforts as an additional message to the main Pool Pump Rebate message. e. SmartAC Integrated Rate Reform was included in outreach as an additional message to the SmartAC acquisition message. f. ESA Program An integrated Rate Reform message was incorporated into direct mail and outreach promoting ESA. g. Home Energy Report in 2016, messaging about Rate Reform and rate plan options was provided to approximately 1.4 million Home Energy Report recipients in either the April/May or August/September printed reports (approximately one million general population/400,000 low income). Customers who received this message were invited to go online to learn more about their rate plan options and ensure they were on the right rate for their home. h. CBO and Contractor Training Toolkits The toolkits were designed for CBOs, community leaders and ESA program contractors and provide overall Rate Reform information, a breakdown of key aspects of Rate Reform, and suggested solutions to help customers work through the changes. All toolkits include: (1) training materials; and (2) creative collateral, including social media -90-

105 posts and a brochure that provides information on rate changes. The brochure also has in-language options for hard-to-reach customers. The brochure is available in Spanish, Chinese (traditional), Tagalog, Vietnamese and Hmong. i. SmartRate Welcome Kit Currently contains integrated tips for energy efficiency and ways to shift/save as well as Rate Reform messaging. j. SMB Digital Newsletter An article on residential rate options was included in the July issue which encouraged employers to share the information with their employees to ensure that everyone was on the right rate plan for their home. k. Residential Welcome Kit In the new residential welcome kit, PG&E will include information about rate options and rate choices, directing customers to learn more. d. Future Residential Rate Reform Integration Efforts for Looking ahead to 2017 through 2019, PG&E will continue to focus on helping customers gain greater control over their energy use and bill by facilitating deeper engagement with rate plan options, programs, tips, tools and solutions. The integrated initiatives will leverage consideration of various types of customers, objectives and channels to help the Company successfully promote what s best for customers while adhering to the test, learn, optimize approach. PG&E will continually look to new opportunities to integrate messages related to both Rate Reform efforts and its Integrated Demand Side Management (IDSM) portfolio. The list below outlines some key integration ideas that are being considered for the future. This list is illustrative and is not exhaustive of all examples or future possibilities. a. Voluntary TOU and Default TOU Education Communications Educational materials will also present customers with details on bill management tools and solutions including Energy Alerts, Balanced Payment Plan, and the benefits associated with an online account. Seasonal solutions for summer and winter will concentrate on programs and tips and tools to help shift and reduce load. b. High Usage Surcharge Communications will help customers understand what the high usage surcharge is and offer them tips and tools to help with energy conservation, such as Home Energy Checkup, low income programs, and rate options. c. Summer and Winter Campaigns Twice yearly campaigns will feature content with energy efficiency tips and programs across PG&E s IDSM portfolio to help customers save money and energy. d. Rate Comparison Reports In addition to helping customers understand what rate is best for them and that they have rate options, the content in this communication will include energy efficiency tips for customers. As the tool is rolled out in future iterations, PG&E will explore opportunities to integrate other programs and solutions that are tailored to the customer receiving the report. -91-

106 e. Website For many campaigns, customers will be directed to pge.com where they will find additional information about rate plan options, programs and energy management options for their energy use and bill. f. Community-Based Engagement Integration efforts for community-based outreach will occur in , as described in Chapter IX. e. Potential Rate Reform Integrated Outreach Opportunities for In addition to the opportunities for integration identified in 2016, many of which will continue, PG&E has identified new opportunities for integration, including: a. Energy Alerts Include Rate Reform message; b. Energenius (After School Program) Build in information about Rate Reform as part of the curriculum for the Energenius Program; c. CARE Retention Materials Incorporate Rate Reform messaging into the Auto-Renew and Recertification communications; d. CARE Welcome Kit Add Rate Reform messaging to 2017 CARE welcome kits, which already contain energy efficiency tips and information on ESA Program; and e. Future proceeding Integration Opportunities: Assembly Bill (AB) As AB 793 rolls out in 2017, communications will include Rate Reform messaging, as appropriate Low Income There will be an opportunity to promote Rate Reform messages, as appropriate, in ESA program energy education which is provided while the contractor is on site at the customer s home f. Reporting of Integration Efforts To ensure that these integration initiatives have broad visibility, PG&E will continue to submit its IDSM Quarterly Report 100 as well as the quarterly Progress on Residential Rate Reform Quarterly Reports (PRRR) PGE.com Website PG&E customers with online accounts can view and pay their bills, check their account balance and payment history, set up recurring payments, sign-up for paperless bills, and set up account alerts. Pge.com is one of the most effective channels for 99 Assembly Bill 793 (AB 793) requires an electrical or gas corporation to develop a program to provide incentives and to educate customers about the incentive program to a residential or SMB customer to acquire energy management technology for use in the customer s home or place of business. 100 D D , Decision on Residential Rate Reform, July 3, 2015, mimeo, pp

107 educating customers on energy related topics, especially those focused on rates. The channel s use is widespread, with 3.1 million residential utility accounts enrolled online. 102 Visits are up roughly 7% year over year, and 55% of customers are in PG&E s High Tech segment (up from 31% in 2008). 103 This group gravitates toward self-service, and gets excited about new digital offerings. Results from a March 2016 study further support pge.com s role in educating customers on and engaging customers in their energy use. The study concluded that 72% of residential customers consider PG&E as a resource to find information on customer rebates, energy savings and tips to help customers save energy and money on their bill, and of those respondents 80% indicated that pge.com was their preferred channel for obtaining the above information. It is also important to note that PG&E s high usage customers are even more likely to use the pge.com website (87%) as their preferred channel for information on how to save energy and reduce their bill. 104 An increasing number of PG&E customers are using digital channels as their preferred source to obtain information about their energy use. In addition, rates and rate options are seen as increasingly important to PG&E customers. Customers seeking information on rates can receive general guidance on the public portion of pge.com, and if they create an account and sign in, they can receive more personalized rate guidance. To address this customer need, PG&E created a dedicated tab to Rate Plans on pge.com. 105 This dedicated page, along with improved site navigation, has yielded an average 17.5 thousand visitors per month from October 2015 to September 2016, and total visits over that same time period is up 74% year over year. 106 The primary website objective in support of Residential Rate Reform is to provide customers with easy access to information that promotes education, understanding and engagement with residential rates and rate options. As noted in the Greenberg 102 CC&B custom extract (SM-7031). 103 Webtrends Report on PGE.com measured from January 1 to December 31, 2015 against January 1 to December Rate Reform ME&O Tracking Survey Report, Hiner & Partners, March Webtrends Report on PGE.com comparing Oct Sept versus Oct Sept

108 Blueprint, 107 it is important to have the information available for those that want it instead of trying to burden communications with too many details. Pge.com is the ideal environment to provide information for those want to understand ore of the details, as well as those that may just want the highlights. PG&E s goal is to provide easy online access to rate information for all customers, regardless of whether the customer has an online account login. For customers without an online account login, there is publicly available information in the rates section of pge.com. Customers can easily find an overview of all rate plans, as well as pages that offer more details for each rate option. Additionally, there is educational material to help the customer understand how rates are set, definitions of common terminology, and an overview of upcoming changes. For customers who create an online account, PG&E provides a more robust selection of personalized information, after login, through which they can compare rates and see projected savings for various rate options based on their past usage. The PG&E website is an important component of PG&E s customer education and outreach strategy. The following strategies will help to further the customer communication goals for Rate Reform: a. Align website messaging with broader marketing initiatives to create a connected customer experience that helps drive understanding and engagement with rates and rate plans; b. Ensure an intuitive customer experience that simplifies the customer journey and drives engagement in rates related tools; c. Drive customers to personalized tools to help them understand their personal impact and ways to manage their energy use; and d. Provide relevant, in-language online experiences for customers who prefer Chinese and Spanish and where possible other communities of color. a. Recent Rate Reform Website Improvements The content for pge.com/ratechanges was upgraded as part of a larger pge.com site redesign in which improvements were made to make the website more accessible to customers with disabilities. The upgrade also resulted in a simpler and friendlier user experience. Over 800 pages of content were re-written for brevity and clarity, and customers were involved in all aspects of the redesign, from the grouping of information to naming those groups. The upgrade also focused on a mobile first design, given that 107 RROIR MEO Blueprint: Integrated Marketing, Measurement, and Alignment Strategic Action Plan for Residential Rate Reform and TOU_V2, Greenberg, Inc., August 19, 2016, p

109 almost 40% of all visits to pge.com are from a mobile device. 108 As a follow-up to the recent upgrades, PG&E conducted a website audit to evaluate the content and the customer flow of the Residential Rate Reform pages to ensure an optimal customer experience. The audit resulted in the following actions: Developed new content to educate customers about rate related topics Streamlined navigation and removed redundant pages Translated rates related content for Spanish and Chinese b. Future Rate Reform Website Improvements 1. Launch New Education Video Series PG&E plans to launch a series of videos focused on rates, energy management and tools to help customers better understand these topics. Topics in consideration are rate options including tiered and TOU plans, tools and programs to help manage energy usage, the High Usage Surcharge and Rates 101, which would give customers a better understanding of how PG&E makes money and why energy management is so critical. These videos may also be featured on the employee education Topic page or on PG&E s YouTube channel. 2. Improve In-language Rates Experience PG&E plans to continue to improve messaging for rates related content on the Spanish and Chinese pages. 3. Overall Language Improvements Taking recent customer research and best practices into account, PG&E plans to simplify language related to rates to make the content overall on the rates pages more customer friendly. This is consistent with the website redesign, where the target grade level for reading comprehension is no higher than 9.9 to meet web accessibility standards (WCAG 2.0 AAA). c. General PGE.com Improvements PG&E is focused on continuing to improve the website platform in the coming years as the channel continues to grow. These enhances are not specific to Rate Reform, but will continue to improve customers overall online experience; examples include: 1. Implementation of a tool that will allow PG&E to see how the user moves through the website, instead of just the count of pages viewed. For example: Did the customer go from page A to B to C? Or, Did they start at B, and then go to page A? This will help PG&E better understand the customer s online journey. 2. Implementation of a tool that allows a playback of the user s session, which will help in troubleshooting any, reported issues. 3. Migrating the existing Spanish and Chinese pages over to the new website design, and improving the experience for customers visiting on mobile devices. 108 Webtrends Report on PGE.com, month over month trends, September

110 4. Continued A/B testing and optimization to get more customers to their transactions online, CARE enrollment, rate changes, or starting service. 5. Creation of a searchable online help center to help customers get answers to their most frequently asked questions. 6. The ability to look up an account number online in case they don t have it available. d. Online Energy Management Tools PG&E plans to continue evolving customers online experience to help them more easily understand and manage their energy usage. PG&E s strategy for improving online tools to support customers is a two-pronged approach. First, the strategy seeks to increase customer awareness of energy usage, and second, offer assistance that enables customers to make changes in order to manage their bills. Online features that help customers better understand their energy usage include: (1) the components of their energy statement; (2) rate options; and (3) savings opportunities. Online features that enable customers to take actions include: (1) creating energy management plans; (2) applying for rebates, and (3) purchasing products and/or services such as sealing air leaks, insulation, or appliance recommendations. The following table summarizes the educational material available to customers through PG&E s online account platform. Please see Appendix D for images of PG&E s web tools. -96-

111 Product Usage and Cost Presentment Home Energy Checkup Table: Digital Energy Management Educational Tools Product Description Helping Customers Increase Awareness and Understanding of Energy This product helps customers understand their energy usage by providing a graphical depiction of customer usage and cost. Customers can choose from various temporal views (e.g., year, bill period, and interval) to display their usage and cost. For most residential customers, the interval view displays cost and energy usage by hour. This product helps customers understand their energy usage by providing energy efficiency tips for households. Customers are given a quick 5-minute online questionnaire. Once the questionnaire is completed, customers are presented with a customized energy assessment that shows how much energy they use, where they use it, and steps they can take to lower their bill. Bill Forecasts Energy Alerts (Bill Forecast Alert) This product helps customers by creating a no surprises billing experience. By providing an estimated projection of the expected bill at the end of the billing cycle, based on current usage patterns, customers are able to better predict the cost of their bill and take necessary steps to manage their bill. In conjunction with the Bill Forecast tool, tips for the home are provided as a way to help manage the bill. This product creates a no surprises billing experience for customers. Customers who sign-up for Energy Alerts can set a unique monthly bill notification amount, using a dollar amount threshold for electricity and gas charges. If a customer s bill is estimated to exceed the threshold, the customer will receive an Energy Alert via their channel of choice , text or phone call. By receiving these notifications prior to exceeding the threshold amount, customers are given an opportunity to adjust their energy usage as necessary. Moving From Understanding Energy to Adjusting Energy Usage Bill Comparison This product provides customers with additional insight into changes in their bill amount by allowing customers to view total bill comparisons for gas and electric charges. Customers using this product are presented with top reasons that explain why their bills have most likely changed. These top reasons include changes in pricing, variations in weather, and changes in season. If a customer s total bill has changed for rate-related reasons, an applicable rate-related insight appears. Some examples of rate-related insights include: Highest tier insight: If a customer s highest tier has changed between bill periods, customers are presented with an explanation of the change in total cost of their current bill, compared to a previous bill, using the highest tier of both bills as the point of reference. For example, a customer receiving this insight might see an explanation of, You were in the less expensive Tier 2 rate because you used less electricity, or, You were in Tier 4 during this time last year. Time-of-Day insight: For customers enrolled on a time-of-use rate plan, this insight compares time-of-use charges by time-of-day periods (i.e., peak, off-peak, and partial peak) on the customer s current bill to the customer s previous bill. SmartRate insight: For customers enrolled in SmartRate, this insight displays SmartRate charges and credits as compared to the previous bill. -97-

112 Product Home Energy Analysis Next Best Action Table: Digital Energy Management Educational Tools Product Description Moving From Understanding Energy to Adjusting Energy Usage This product provides customers with a detailed view of their energy usage and costs, by appliance, in order to enable customers to understand where they may be able to adjust energy usage. For all customers using this product, monthly energy usage is displayed by end-use category (i.e., appliances, lighting, and heating). For customers using this product who choose to take a Home Energy Checkup, customers are provided with the added detail of cost in each end-use category for a given bill period. This product will guide customers through energy management decisionmaking, taking into account previous actions taken. For example, Next Best Action will encourage a customer to complete a Home Energy Checkup if the customer has not done so previously. The customer discovery guides the customer journey. PG&E is currently in development to improve the tool to create the aforementioned customer journey in order to ensure that customers experience the most relevant features. Tips and Ideas This product provides customers with energy management and money saving tips. Tips are organized by themes, and further sorted by highest potential savings. Customer response to the Home Energy Checkup also impacts the filtering. Examples of some themes include: Manage Your Summer Energy Costs and Tips for Renters. Moving From Adjusting Energy Usage to Managing Energy Usage Rate Comparison and What-If On-Line Rate Enrollment Solar and EV What-If Rate Comparison helps customers understand which rate they would perform best on. What-If helps customer understanding of rates by further providing information about how the rate works. Completion of Rate Comparison is a prerequisite for using the What-If tool. Rate Comparison calculates hypothetical bills on alternate rates available to the customer, using historical usage. If a customer continues onto the What-If tool, the customer is presented with various behavioral questions (e.g., Can you reduce usage all the time? Can you shift usage during certain times during the day?). Upon answering these questions, recommended actions appear to help the customer understand how they can lower their energy usage and costs. What-If further demonstrates how those actions impact performance on their best rate. Finally, What-If takes into account customer behavior from the responses to the behavioral questions in order to present hypothetical bill impacts. This product helps simplify the rate enrollment process by offering online rate enrollment, an alternative to calling to enroll in a rate. By visiting pge.com/myrate, customers can enroll in alternate rate plans. This product will help customers manage their energy usage by understanding how a photovoltaic (PV) system or an electric vehicle (EV) could potentially impact their bill. The Solar and EV What-If tool allows customers to model the impact of PV system or an EV, on various applicable rates. 3. PG&E Contact Center The Contact Center is one of PG&E s primary channels for providing direct customer support. As a result, PG&E s Customer Service Representatives play a crucial role in rate education through this direct interaction with customers. In order to leverage -98-

113 the opportunity to educate customers about residential rate changes and rate options, PG&E continues to enhance training and resources. In addition to ongoing training efforts, PG&E is planning various enhancements to the start/transfer service channel and upgraded welcome kits for new residential customers. a. Training for Customer Service Representatives In order to enable Customer Service Representatives to provide a positive customer experience, training is provided frequently using a variety of tactics. PG&E s approximately 900 Customer Service Representatives have received multiple training sessions on residential rates changes. This includes new hire training, which is a 7-week training with over 30 hours devoted to rates and specialized training on Rate Reform. Additionally, given the numerous changes from Residential Rate Reform, PG&E has utilized several methods to reinforce retention of rates knowledge, including electronic read and learns, department-wide communications, podcasts, wallboards, supervisor-led discussion guides, two-way dialogue between employees, and rates-related articles in PG&E s company-wide General Reference (GenRef) tool. Moreover, PG&E is currently in the midst of providing a refresher on its prior general rate education training, to further reinforce knowledge of rates and customers rate choices. As part of the updated general rate education training, Customer Service Representatives will receive training on how to provide additional TOU related rate information to customers, such as rate comparisons. PG&E has started this training and will continue the training to ensure new and seasoned Customer Service Representatives will be able to effectively and efficiently interact with residential customers. Due to the large scope of this exercise, which affects taking them off the phones to train, this general rate education training is anticipated to be complete by the end of the First Quarter b. Resources for Customer Service Representatives In addition to training on content, resources are necessary to support rate conversations with customers. These resources include tools and internal subject matter experts. Some sample tools for Customer Service Representatives include: 1. Rate Recommendation Tool: PG&E is currently planning to develop a tool that representatives can use to help customers choose the rate that is best for them without needing the customers online login information. This tool utilizes an algorithm that selects an optimal rate based on lifestyle and energy usage questions. The algorithm was developed by modeling energy usage on various rates. Due to the difficulty of accurately forecasting future performance on rates, -99-

114 this tool relies on modeled actual usage and assumptions about usage behavior, to select an optimal rate. As PG&E continues to learn more about forecasting future performance on rates, the algorithm for this tool will be further refined. 2. Follow-Up Tool: PG&E is currently planning to develop a tool that representatives can utilize to send follow-up s to customers after a residential customer contacts the call center. These s would be customized to include additional information about programs, tips, or rate option information, depending on the relevance to the customer s reason for contacting PG&E. This tool is currently in the development stage and will be further refined. Moreover, PG&E has recently created a new group of approximately 60 Customer Service Representatives, who have volunteered to become Rate Pros. These Rate Pros are rate content experts, who will not only be prepared to have detailed rate conversations with customers, but will also be rate-related mentors and coaches for their fellow representatives. c. Start/Transfer Service Enhancements The July 22, 2016 ALJ Ruling directs the IOUs to include, in this ME&O plan, a detailed plan for integrated rate discussions into the start and transfer service process, including a sample customer service script used by the Customer Service Representatives to assist customers in understanding their rate options, when customers establish or re-establish service. As the July 2016 Ruling notes, when customers move and establish, or re-establish, electricity service, 109 which PG&E refers to as starting or transferring service, it is an opportunity to learn about rate options. Currently, residential customers can start or transfer their service by speaking to a Customer Service Representative, visiting a local office, calling PG&E and using the interactive voice response system, or visiting PG&E online at pge.com. PG&E plans to enhance the start and transfer service by continuing to improve customer rate option education. PG&E is in the process of developing specific plans and training content for the start and transfer service. As currently planned, the training will be developed in Second Quarter 2017 and implemented in Third Quarter 2017, with completion of training planned by December 31, This training content will aim to train Customer Service 109 July 22, 2016 ALJ Ruling Regarding Bill Comparisons and Directing Utilities to Develop Plans for Engaging New Customers, p

115 Representatives to effectively help customers understand their rate information and enable customers to make an informed decision, when selecting their rate plan. There are a variety of ways to provide this training and PG&E is in the process of evaluating the best alternative for this effort. The training and process tools available to Customer Service Representatives will include a revised set of questions to ask customers, starting in 2018, during a start or transfer service request, or a script. The script is intended to support conversations with customers by listing questions relevant to a customer s energy usage that will help them identify a recommended rate. The script also contains information about specific rate options that may be provided as additional information. PG&E has developed a sample script and intends on further refining the script, to incorporate research pertaining to identifying optimal language and additional feedback from various subject matter experts like rate experts and Customer Service Representatives. After the revised script is implemented, it will continue to be refined as learnings from pilots and open proceedings are obtained. Pending the outcome, in this proceeding, on various remaining issues under Pub. Util. Code Section 745, PG&E will refine this script at a later time (e.g., to incorporate the CPUC s final findings on unreasonable hardship). The following is a sample script that contains illustrative questions and is subject to change, as PG&E garners additional insight

116 Sample Script Electric Residential Start/Transfer call, prior to discussing rate plan options: Agent will search and pull up the customer s account record or, if new, create person and account record Locate premise Review and verify general account, premise information and notes Now that we have set up an application of service, may I ask you a few questions about your home to help you select the best electric rate plan for you? Access questionnaire, if applicable (Agent identifies the baseline territory and the heat source of where the customer is starting service) o Home and lifestyle sample questions: How many bedrooms does your residence have? Do you have an air conditioning unit? If yes, how many? Is anyone home during the day? Do you own an Electric Vehicle? If yes, how many? Review responses and based on decision tree determine best electric rate option. PG&E offers five different rate plan choices. Based on the information you have provided, I would recommend the rate plan. Provide customer summary of the rate plan (use GenRef for bullet points) and include pricing information. Does the rate plan sound like it will work for you? Please note, as rate changes take effect over the next few years and as your electricity usage changes, your rate options may also change. You can monitor your usage by registering your account online at pge.com. You will receive a welcome kit with additional rate plan options and programs we offer at PG&E. In addition to Customer Service Representative training, the interactive voice response system with PG&E 800 number will be enhanced to incorporate a new script that will identify new-to-pg&e customers. Currently, customers who call in through the interactive voice response system start or transfer service process must go through an authentication process. If they are unable to authenticate themselves, likely because they do not have an existing account with PG&E, they are transferred to a Customer Service Representative instead of starting their process through the interactive voice response system. The new script will identify new-to-pg&e customers and allow new customers to start their service through the interactive voice response system process, without being transferred to a representative. The option to learn more about available rate plans is currently provided in the interactive voice response system process and will be provided in the enhanced interactive voice response system script for new -102-

117 customers. Enhancements to the interactive voice response system script are currently anticipated to be complete by the end of In addition to the interactive voice response system script changes, PG&E plans to enhance the online start and transfer service request process to better support customers in choosing a rate. While customers who visit PG&E online are offered various applicable rate choices when they start or transfer service, PG&E would like to provide additional information to help customers choose their rate. PG&E is currently analyzing the type of information that would be most helpful to customers. Once the analysis is complete, PG&E will determine how best to implement any changes to the online start and transfer service process. d. Welcome Kits for New Customers When new residential customers start service with PG&E, the customer is sent a welcome kit. Given the importance of this opportunity to educate customers, PG&E is in the process of reassessing the existing customer welcome kit. PG&E currently plans to update the welcome kit, to include information on PG&E s available residential rate options, program offerings, and helpful contact information. Overall, this integrated plan to enhance the existing start and transfer process will further enable customers to better understand their rate choices and provide them an opportunity to select the best rate for them, when they establish or re-establish service. e. Communications Campaign Overview: Media and Employees PG&E s corporate communications primary goal is to inform and engage employees, media and influencers about the importance of residential rate change in PG&E s service area. The communications plan is integrated with the marketing plan to ensure consistency of message, timing and call-to-actions. As the internal and external communications campaign will span three years, it s important to sustain the rate change conversation over this time period. In 2017 and 2018, PG&E will lay the foundation about the changes under Rate Reform, and its importance, as well as inform media and employees about available options and tools. In 2019, PG&E will set the context for automatically enrolling customers in TOU rates. The primary messages will be about a customers rate options and how they can engage with tools to help them make the right choices for themselves and family or business, as well as why and how Residential Rate Reform is good for the state of California

118 The goals of this communications plan are to: Establish PG&E as a trusted Energy Advisor who is here to help; Educate media outlets about rate choice and the many options customers have to reduce energy use as well as how rate change is Good for California; Educate via seasonal campaigns, both summer and winter. Build awareness through summer and winter seasonal campaigns about the impacts of structural rate changes such as bills might be higher during hot months, but should be lower than before during the rest of the year; Drive awareness for low income programs through events with CBOs; Communicate that rate change is an important and timely initiative that customers need to learn more about; and Simplify the proposition that rate changes are a good thing for California and will help leave a cleaner, greener state for generations to come. A number of communications vehicles will be employed to extend the reach and frequency of messages to the target audiences. Different people consume media in many different forms. It is important to develop and distribute messages across a wide variety of platforms in order to inform, educate, and generate awareness to as broad a demographic as possible. PG&E may utilize the following communication channels for external audiences: Mainstream media Local media Local influencers Bloggers Social media channels as appropriate 4. Media Relations (Public Relations) To increase the overall reach of the marketing plan, PG&E plans to leverage Media Relations. PG&E believes that the Greenberg Blueprint recommendation undervalues and underleverages Media Relations in its recommendation. Media Relations are a cost effective way to drive additional reach and awareness. As stated earlier in Chapter V, PG&E believes that impacting 90%+ of consumers with ongoing messages is important, however, other communication elements like public relations and direct marketing, -104-

119 should be expected to contribute to that goal. It should not be the sole role of paid media to deliver high impact customer messages. In working with the media, it s important to develop a messaging framework to ensure consistency across all channels and spokespeople. As this is a three-year program, PG&E will stage its messages to match the programs that are being introduced to our customers. 1. In 2017, PG&E plans to lay the rate change foundation, highlighting the tools and options available to our customers; 2. As additional programs such as the High Usage Surcharge are introduced in 2017, PG&E plans to include these in our educational efforts; and 3. As our customers are automatically enrolled in TOU rates in 2019, PG&E will focus the conversation on this program. Media relations tactics include: 1. Develop a targeted and tested message platform. You have Options and Good for California are two possible overarching messages around which PG&E will develop comprehensive messaging. 2. Media train subject matter experts as spokespeople who can inform and engage customers. 3. Develop media materials including deskside briefing materials, fact sheets, rate change presentations, frequently asked questions and media statements. 4. Initiate an aggressive media outreach campaign to inform the media about rate options available to customers and the tools to help them manage their energy use. 5. Plan and manage local media tours with key spokespeople. These media tours will be timed with the phased approach of the default TOU rollout. 6. Partner with key in-language media partners to inform customers in their language, via vehicles that they trust. 7. Develop a series of op-eds on the benefits of rate change, tools, options and a cleaner California. a. Regional Grassroots Public Awareness Face-to-face conversations are critical in helping customers understand and make changes in how they use and manage energy. PG&E will work closely with communities to identify local thought leaders and influencers from elected officials or local CBOs who can help share rate change information and explain about the tools and options available to help our customers. In close coordination with local CBOs and teams, local activities to increase awareness may include the following: Host webinars or online media and consumer events to inform employees and customers about the options and tools available to them; and -105-

120 Develop and media train local consumer advocates who can in turn, inform their networks on the options and tools available to them. b. Media Influencer Relations The way PG&E customers consume media has changed significantly. In addition to television and newspapers, PG&E customers are informed about current topics from a variety of different channels, most importantly social media outlets. The influencer program will research the many ways our customers consume information and who they trust. PG&E will target influencers in each market and work in partnership to inform their audiences on rate change, options and tools. The process needed to develop an influencer program could include the following: 1. Recruit and train influencers and trusted third-party advocates to inform customers about rate change, options and tools. 2. Develop a toolkit for these trusted partners to use to inform and engage their networks. 3. Develop relationships with influential bloggers, and conduct outreach around rate change milestones. 4. Host blogger summits where clean technology and rate change is discussed and debut website content and other campaign elements. An example of this could be to develop platform where PG&E would partner with mom bloggers who have large followings to help inform other moms about rate change, options and tools. 5. Seek out YouTube stars and bloggers who could create a video series about their own focus on activity that is Good for California. c. Educational Curriculum Often, the loudest voices in a household are the kids, and they can be effective messengers and teachers. Borrowing a page from playbooks for recycling and seatbelt educational efforts, PG&E is looking to collaborate with third-party resources to develop and incorporate an educational curriculum for high school students to learn about rate change and the need for a 21st century energy grid. PG&E can also repurpose such materials for senior citizens, a group often living on a fixed-income whom it would be especially important to educate. The process to develop such a program could include: 1. Develop a rate option curriculum unit for audiences for high school and community college students; 2. Partner with home health-care professionals and community colleges to educate senior citizens on the best rate and programs for them; and 3. Program could also establish the early stages of college-level training for green collar jobs

121 d. Thought Leadership Platform Thought leaders are the informed, go-to people in their field of expertise. They are trusted sources who move and inspire people with innovative ideas. PG&E would develop a thought leadership platform on the benefits of rate change for California. 1. Partner with thought leaders on California environmental leadership. 2. Develop academic partnerships to help inform our customers about rate change and the need for conservation; 3. Research and develop speaking and sponsorship opportunities about the need for a cleaner, greener California; and 4. Collaborate with environmental NGOs and other third-party organizations to support the benefits of rate change. e. Digital and Social Media As detailed in the marketing section, a strategic communications program entails meeting customers where they live, work and play. Today, this often means utilizing digital and social channels. Today s customers are connected, 24/7, mobile and social. It is interesting to note that according to the 2016 Edelman Trust barometer study; friends and families are the most trusted information sources online, followed by academics. PG&E is investigating leveraging customers social nature to supplement the Residential Rate Reform content on pge.com. 1. Employ the voice of the customer. Video and transcript copy of interviews and home walk-throughs with customers who have made behavioral changes and seen an impact. 2. Create extensive FAQ s based on user-submitted questions on rate changes and energy efficiency changes. f. Social Media Presence PG&E has a robust social media presence. Our current channels include Twitter (61,600 followers), Facebook (149,000 followers), LinkedIn (78,800 followers), Instagram (7,000 followers) and YouTube (2,936 followers). In PG&E s experience, local and targeted messages garner the most support and engagement, and sponsored posts enable PG&E to reach more of our audience. The content will need to be carefully curated to successfully engage our customers via these social channels. Earlier attempts to inform customers on rates have resulted in a mostly negative response, so a cautious and well-thought out content strategy will be critical. 1. Host live chat sessions with experts Chat with a Rate Guru. 2. Utilize Twitter feed to share news, innovations, and interact with media, prospective customers, etc

122 3. Leverage YouTube channel to house all related video content, executive interviews, customer testimonials, thought leadership, etc. 4. Turn employees and partners into social media ambassadors and seek out opportunities for them to engage in discussions on blogs and/or message boards. g. Employee Education PG&E has over 22,000 employees throughout our service area. These employees are well-positioned to act as the bridge between the Company and its customers, and are often the best advocates. PG&E will establish a regular cadence of communications and training to ensure that its employees and retirees understand the schedule of rate changes and have the tools they need to discuss these matters with customers, family and friends. As previously mentioned, the timeline for rate change will take place over the next three years. Employee communications will be timed with the various rate change programs so that employees are well versed in how to help customers, family and friends prior to new changes being introduced. Employee educational outreach may include the following: 1. Web-based training modules. 2. Presentation and meeting materials 3. Frequently Asked Questions (FAQs) for employees. 4. Ongoing development of materials for customer interaction. 5. Regular employee communications on the implementation of new rates, and how best to help customers make informed choices about their energy use. 6. PG&E will host an intranet site to house all previously-distributed information as well as links to tools and programs that can help PG&E employees assist customers with making the right rate choice and manage their energy costs. 7. PG&E will inform employees of its unique Here to Help hotline. Employees who are asked questions from their family and friends, but don t know where to turn to find the correct information, can call the Here to Help hotline. Hotline advisors will be well informed regarding the tools, rates and programs available to PG&E employees and customers. IX. Partner and Community-Based Organization (CBO) Strategy A. Approach for CBO Strategy PG&E is committed to low income and hard-to-reach customers and the Communities of Color efforts. PG&E offers a portfolio of programs, services and partnerships that serve customers each year in 48 counties. PG&E collaborates -108-

123 throughout the state to educate customers about the impacts of rate changes and the availability of rate options, programs, tips and tools to improve energy management. Currently, PG&E partners with over 70 CBO s that support awareness, outreach and enrollment activities for PG&E s portfolio of services. Building upon these trusted relationships and developing new, strategic partnerships will be a critical component in informing PG&E s customers of rate changes. PG&E aspires to build broad engagement throughout communities in its territory by promoting high-impact community collaborations and utilizing the knowledge, creativity and outreach capabilities of community partners to benefit those who may be hard-to-reach or unengaged low-income customers. These efforts seek to foster a culture of energy awareness, management and sustainability to promote energy learning and support customers to take action to manage their energy usage. PG&E s Community Engagement goals are to: 1. Develop an overall implementation plan and community feedback loop. 2. Create innovative training guides, tools and collateral. 3. Inform local and elected officials, civic institutions and community leaders about rate change. 4. Drive engagement via events and community activities. 5. Empower customers to take action on rate choice, control and options. 6. Nurture ongoing network of community partners to serve as ambassadors for rate change. PG&E plans to direct its community outreach efforts towards the hard-to-reach customers. These customers are often less engaged and have not been as accessible or responsive to conventional marketing methods like direct mail, and automated calls. Community partners will complement traditional marketing tactics with one-on-one direct interaction with hard-to-reach customers, host community events within the neighborhoods and locations where hard-to-reach groups reside, and offer information on energy management when customers seeking other social services visit their organizations. Community partners will be well-equipped with information and comprehensive training necessary to address bill impacts for customers who may have questions about bill fluctuations due to rate changes, such as customers incurring a High Usage Surcharge and those affected by the gradual increase in Tier 1 and Tier 2 prices. Select CBOs will educate these customers on programs, tips and tools like Energy Alerts, Home Energy Checkup, and energy conservation activities

124 PG&E will test its community engagement efforts on Residential Rate Reform awareness. To develop its test plan, PG&E engaged its Communities of Color Advisory Group, made up of CBO and faith-based leaders across the service territory, to advise the company on metrics, reporting cadence and evaluation expectations. PG&E designed a plan that tracks metrics such as: community events, number of customers enrolled by CBOs into low-income assistance programs, number of CBO staff trained on rate changes, and demographics of customers reached by CBOs. These results and CBO testimonials will become part of PG&E s ongoing feedback loop to determine scope, efficiency and effectiveness of community engagement efforts. B. Alignment with the Greenberg Blueprint on Network of Networks Framework In general, PG&E agrees with Greenberg s articulated framework in the Network of Networks strategy and offers areas of further consideration. Leveraging multiple networks for grass-roots outreach is an effective channel to overcome key barriers to engagement. Network Community Nodes increase engagement, promote authenticity and deepen credibility when deployed in communities. 110 PG&E s current Community Engagement strategies follow these same principles. The company has cultivated numerous networks throughout the service territory. PG&E awards funding to diverse non-profits, collaborates closely with community-based organizations to advance low-income assistance programs, and maintains key relationships with elected officials, local representatives and civic institutions to strategize on issues facing their communities. These networks come together to coordinate on broad awareness topics (e.g., safety, rate change) and address specific issues particular to that community (e.g., CARE enrollment). PG&E efforts build on the Greenberg Blueprint activate the network approach and ensure deeper integration with community-based organizations through their unique standing in the community and leadership they provide. The Greenberg Blueprint recommendation to develop a network hub to include three to five statewide/national non-profits is a strong start to achieve broad buy-in and leadership from large 110 RROIR MEO Blueprint: Integrated Marketing, Measurement, and Alignment Strategic Action Plan for Residential Rate Reform and TOU_V2. Greenberg, Inc. August 19, p

125 groups. 111 However, these statewide non-profits must partner with smaller, nimble community-based organizations that have the pulse of a community and more closely represent the people they serve. These high-impact CBOs provide insights on nuanced relationships within a community and real-time opportunities to address challenges. On-the-ground stakeholders can also assist in expanding the Greenberg Blueprint proposed hard-to-reach scope. Greenberg identified four key hard-to-reach populations: linguistic isolation, high poverty, disabilities, and remote locations. 112 PG&E recommends partnering with specific CBOs who can address other hard-to-reach populations like: racial/ethnic minorities, elderly, transient families who move frequently, and renters in multifamily buildings. Including CBOs with deep knowledge in these areas furthers the network s understanding of these communities and effective strategies to serve them. PG&E applauds the Greenberg Blueprint for recognizing the benefits of targeting 13 to 21 year olds who will be future rate paying customers, and who already tend to be energy and environmentally savvy. 113 However, PG&E believes that a more cost effective approach to reaching this audience is through its existing school-based energy curriculum, Energenius, throughout afterschool programs in targeted, low-income districts, rather than mass media, as recommended by Greenberg. This series of four Energenius learning guides have been updated with culturally-competent curriculum and engaging activities to encourage youth to better understand their energy choices and take action to reduce usage. Students are provided tips and tools to share at home with family and community members to spread awareness on energy and the environment. PG&E will continue to train afterschool professionals on the Energenius curriculum as an effective, tangible strategy to educate students within hard-to-reach communities. 111 RROIR MEO Blueprint: Integrated Marketing, Measurement, and Alignment Strategic Action Plan for Residential Rate Reform and TOU_V2. Greenberg, Inc. August 19, P RROIR MEO Blueprint: Integrated Marketing, Measurement, and Alignment Strategic Action Plan for Residential Rate Reform and TOU_V2. Greenberg, Inc. August 19, P RROIR MEO Blueprint: Integrated Marketing, Measurement, and Alignment Strategic Action Plan for Residential Rate Reform and TOU_V2. Greenberg, Inc. August 19, P

126 C. PG&E s CBO Partners Actively Engage Hard-to-Reach Communities PG&E defines hard-to-reach 114 customers as groups who are inaccessible to most conventional marketing and outreach methods and is comprised of those who traditionally would not seek support or cannot access the usual PG&E avenues. These customers can be identified throughout PG&E s entire territory and share one or more of the following hard-to-reach characteristics: 1. Disabled 2. Elderly 3. Limited English proficiency 4. Geographic isolation (rural communities) 5. High poverty 6. Racial/ethnic minorities 7. Transient families who move frequently 8. Housing type (multifamily/mobile home) 9. Home ownership (renters) 10. Education and literacy levels 11. Refugee status PG&E s CBO partners have long-standing relationships throughout these specific communities and serve as a trusted resource to engage hard-to-reach customers. They offer culturally-competent programs, often in a customer s native language, and employ staff who represent the demographics of the communities they serve. D. PG&E Will Employ a Multifaceted Community Engagement Plan PG&E has developed a comprehensive engagement plan that captures both internal and external coordination across partners. 1. Internal Coordination and Leadership PG&E s Community Engagement team (as part of PG&E s low-income Programs and Strategies group) coordinates across existing company departments to leverage communication resources, CBO relationships, community visibility and outreach. PG&E departments represented are: 114 Similar terms for Hard-to-Reach: hidden populations, marginalized populations, vulnerable populations, disadvantaged populations, special populations

127 a. Customer Communications b. Solutions Marketing c. External Affairs d. Community Relations and Public Affairs e. Employee Resource Groups f. Division Leadership Teams g. Local Offices h. Low-income programs (CARE and ESA programs) Each of these groups plays a key role in developing strategy, implementation plans and execution of rate awareness. Leaders from these groups meet regularly to coordinate plans, discuss key community activities, and prioritize funding for community engagement efforts. The Community Engagement team will support internal coordination and leadership in the following ways: Create a culturally and linguistically relevant training curriculum to explain and educate community partners on Residential Rate Reform and the availability of rate options, programs, tips and tools to improve energy management. Conduct periodic check-ins with internal stakeholders on the training and outreach activities. PG&E will incorporate feedback as the year progresses. 2. External Coordination and Community Partnerships CBO partners utilize multiple communication channels including, but not limited to: a. Face-to-face awareness and education efforts with impacted customers b. Community workshops c. Community events d. Door-to-door campaigns e. Outreach through churches and other faith-based groups A primary goal of CBO outreach will be to drive awareness of new rate options and pricing structures that will: a. Make rates more understandable to customers b. Provide customers with new rate plan options CBOs educate customers on becoming better energy managers and providing the resources, tools and tips for customers to make the right decisions for their household. These resources include, but are not limited to: -113-

128 a. Sign-up for an online account and request specialized bill formats (such as Spanish, Chinese, or large font). b. Energy Alerts customers can choose to be notified when their bill is forecasted to reach a certain dollar amount. c. High Usage Alerts customers can receive an alert when they may be close to reaching 400% of baseline. d. Rate Comparison Tool customers can log-in to their accounts and view a comparison on rate options. e. Home Energy Checkup customers can log-in and answer a few basic questions about their home and lifestyle habits in order to receive a list of personalized, suggested improvements from PG&E. f. Providing education on low cost, no cost behavioral tips to help customers manage their energy. For low-income customers, assistance programs are also promoted including, but not limited to: a. California Alternate Rates for Energy (CARE) discounted utility rate for income qualified customers. b. Energy Savings Assistance (ESA) Program free energy efficiency program for qualified customers. c. Medical Baseline customers dependent on life-support or other equipment due to medical needs may be eligible. d. Balanced Payment Plan monthly bill averaged out to allow you to budget your energy costs and eliminate big payment swings. e. Relief for Energy Assistance through Community Help (REACH) one-time payment assistance for qualified customers. f. Low-income Home Energy Assistance Program (LIHEAP) one-time payment assistance for qualified customers. g. Family Electric Rate Assistance (FERA) discounted utility rate for income qualified customers. PG&E partners with CBOs across the utility s service territory to educate customers on assistance programs, energy tips, tools and rate impacts. The types of organizations range from non-profit organizations, advocacy organizations, food banks and public assistance agencies. A few examples of the organizations PG&E currently partners include: a. Health Outreach Workers Respond to needs in the Hispanic community by providing culturally and linguistically relevant outreach to promote PG&E s assistance programs in hard-to-reach communities. b. Community Outreach Contractors PG&E contracts with community outreach contractors, which consist of community-based organizations, institutions, and other agencies, to conduct grassroots, community-based outreach and -114-

129 enrollment. These contracts are performance based and community outreach contractors are compensated at $20 per new CARE enrollment. c. Employee Resource Groups Consist of PG&E s employee affinity networks. These networks serve as a channel to conduct outreach to diverse, hard-to-reach communities, overcoming barriers such as language and trust. Local Offices/Call Centers Offer opportunities to educate customers when they visit. Hard-to-reach customers, particularly in the low-income sector, frequently pay their PG&E bills at local offices on a monthly basis. After-school energy based curriculum (Energenius) The Energenius out of School Time is an after-school curriculum designed to promote energy education to educators and youth. In coordination with California School Age Consortium, PG&E informs families on ways to save money and energy on their PG&E bills. Community Ambassador Program The Community Ambassador pilot is comprised of community-based organizations throughout PG&E s service territory that are trained to provide CARE enrollment and post enrollment verification assistance, energy awareness, and education on PG&E s portfolio of low-income offerings to customers and their families. Communities of Color Advisory Group The Communities of Color Advisory Group was established through the General Rate Case settlement and is scheduled to continue through This group advises PG&E on conducting outreach to diverse, hard-to-reach communities on residential rate awareness. PG&E s primary in-language support for residential rate awareness is Spanish, Chinese, Vietnamese, Tagalog and Hmong. These CBOs are able to provide support in a number of different languages, including, but not limited to the following: Burmese, Cambodian, Cantonese, Hmong, Japanese, Korean, Lao, Mandarin, Tagalog, Taiwanese, Thai, Russia, Spanish, and Vietnamese. The communities served by these CBOs include, but are not limited to African American, Asian-Pacific American, Cambodian, Chinese, Hmong, Japanese, Korean, Hispanic, Lao, Native American, Russian, Vietnamese, Disabled, Seniors, and Veterans. E. Prioritization of Communities Impacted By Rate Changes In Q4 2016/Q1 2017, PG&E plans to focus on customers highly impacted by bill impacts in the winter months, complementing PG&E s proposed marketing campaigns. The company prioritized customers using a data driven approach to identify high impact -115-

130 customers (CARE enrolled and CARE eligible customers that may experience a bill increase of $10 and 10%) in the winter and summer seasons. Pending results of the 2016 campaign, this process will most likely be repeated in 2017/2018/2019 summer and winter outreach. F Community Engagement Work Plan for Residential Rate Awareness PG&E will build upon its existing Community Engagement strategies and incorporate deeper residential rate awareness efforts. Successful channels like Community Outreach Contractors, Community Ambassadors, Energenius curriculum, and Community Health Outreach Workers will be provided increased support and funding to expand their work. Currently, these channels educate customers on low-income assistance programs and will now add specific Residential Rate Reform awareness as a natural complement to these organization s current efforts to provide customers with energy assistance. PG&E anticipates rate change messages will be incorporated into interactions with customers. As part of this coordination, PG&E is proposing to further enhance community engagement activities. Plans for the activities outlined below may change based on additional research and planning

131 Launch Residential Rate Community Ambassador (RRCAMs) program for a select number of Community Outreach Contractors Update low-income brochures with Residential Rate Reform messages Support CBOs to attend community events and offer residential rate assistance Deploy Community Health Outreach Workers in select Highly Impacted counties Train Energenius Professionals to educate youth on Residential Rate and Energy Awareness Proposed Community Engagement Activities PG&E will train high-performing Community Outreach Contractors to have in-depth conversations with customers on Residential Rate Reform. RRCAMs will host energy awareness events, attend community issues forums, and outreach to hard-to-reach communities on breadth of low-income assistance programs. PG&E will review integrated low-income program brochures to add language specific to residential rate awareness to be distributed to the CBO network. PG&E will establish a sponsorship fund for CBOs who request support to attend community events to outreach on residential rate awareness. CBO partners will leverage PG&E funds to cover staffing and set-up at community events they would otherwise be unable to attend. PG&E will direct Health Outreach Workers to canvass highly impacted, Hispanic communities and educate on residential rate awareness. Health Outreach Workers will use culturally and linguistically competent curriculum to discuss issues of rate impacts. PG&E will leverage its existing Energenius curriculum to increase training support for Out of School Time professionals who are educating youth on energy awareness and low-income programs after school, before school, and summer education. Out of School Time professionals will strengthen their knowledge of residential rate impacts and messages to encourage youth to work with their parents and family members to better understand rate impacts and take action. G. Ongoing Training and Support for CBO Partners In order to ensure consistent residential rate awareness messaging, PG&E plans to develop and implement a training curriculum for CBOs with regional trainings held in In addition to the training, PG&E intends to implement a continuous community feedback loop on a quarterly basis and periodic check-ins to maintain quality assurance and control over the residential rate awareness messaging. Furthermore, PG&E will provide CBOs marketing materials and information upon request. The regional training sessions will be designed to educate customers and demonstrate how customers sign-up and use resources, and may include topics such as: -117-

132 How to understand an energy bill What is TOU is and why it is important Rate options What are High Usage Surcharge Alerts How to interpret Rate Comparison Reports Understanding available low-cost and no-cost energy tips Energy Alerts Home Energy Checkup Understanding the best ways to reduce energy during peak periods Low-income assistance programs including: CARE, ESA, Relief for Energy Assistance through Community Help (REACH), Low-income Home Energy Assistance Program (LIHEAP), Community Help and Awareness for Natural Gas and Electric Services (CHANGES), Family Electric Rate Assistance (FERA) Balanced Payment Plan H. Integration with Low-Income Proposed Decision and Alternate Proposed Decision 115 In August 2016, the Commission released its Proposed Decision (PD) and Alternate Proposed Decision (APD) outlining possible future directions for the upcoming ESA/CARE program cycle. These documents provide discussion, analysis, and ordering paragraphs on how low-income programs will be administered and funded including extensive coverage on marketing, outreach, and enrollment activities. PG&E is supportive of the PD s and APD s position on Third-Party Outreach and Enrollment. The Proposed Decision and Alternate Proposed Decision recognize the importance of cultivating relationships with CBOs and other community partners as critical support strategies to augment traditional marketing. Specifically, the PD and APD provide direction on strategies to enhance IOUs engagement with community partners: 115 For Application (A.) ( ESA/CARE Programs and Budgets)

133 Collaborate with ESA Contractors to educate customers on energy education and awareness; Work with California Lifeline providers, Covered California, and other low-income centric assistance agencies for joint outreach and enrollment; Increase Community Outreach Contractor partnerships to further education, outreach, enrollment, retention, and post enrollment verification processes; and Explore other innovative opportunities with low-income assistance agencies where overlap in eligibility and program guidelines exist. PG&E currently supports many community engagement activities laid out in the PD and APD and will continue to identify new community stakeholders to promote marketing, outreach, and enrollment for its low-income programs. X. Measurement and Metrics A. Metrics Goals and Objectives Generate awareness and understanding among customers regarding their rate options, choosing the right rate plan for them, and what they can do to better manage their use and ultimately their bill. PG&E s ME&O plan is designed to prioritize the customer experience throughout the Rate Reform transition process. It is imperative that how PG&E measures the effectiveness of ME&O allows PG&E to understand the customer and how Rate Reform changes impact them on the path to default TOU and beyond. PG&E, SCE and SDG&E have worked collaboratively on the measurement strategy to ensure there is a level of consistency around measurement and metrics yet flexibility to allow for customization by each IOU based on unique circumstances and needs. PG&E s measurement approach, therefore, focuses around awareness, understanding and engagement of specific Rate Reform initiatives (e.g., tier collapse, High Usage Surcharge), and default TOU. This measurement approach encompasses: 1. Tracking the information, tools and solutions that customers are provided by PG&E. 2. Tracking (via surveys) customer awareness and understanding of the outreach and education. 3. Tracking how customers responded through their actions/engagement (e.g., with the PG&E website, with their rate comparison, making a rate change, etc.)

134 B. ME&O Working Group Recommendations for Draft Metrics Following the discussion at the ME&O WG Session on November 16, 2015, the WG proposed ME&O overall objectives for success metrics consisting of awareness, understanding and engagement of: 1. Rate Reform changes, specifically tier collapse and the High Usage Surcharge; 2. Programs, products, tools and tips that customers can use to respond to Rate Reform changes in order to offset increases; and 3. New TOU rate plans and future transition. The ME&O WG agreed to a draft version of 20 key metrics with the intent of finalizing these metrics after the ME&O consultant provided their input. Within the WG recommendations, six of these metrics were recommended as goal metrics; these six metrics are based on customer responses to survey questions, while the remaining fourteen metrics were recommended to be tracked by PG&E

135 Metric # 1 Working Group s Recommendations for Rate Reform ME&O Metrics Metric Customers are aware that there are rate plans that may help them mitigate energy expenditures Goal versus Tracking Goal 2 Customers know where to go to get more information about how to manage their energy use Goal 3 Customers understand how energy use can impact bills Goal 4 Customers understand the benefits of lowering their energy use Goal 5 Customers are aware of the rebates, energy efficiency programs, and tips offered by their utility that can help them manage their Goal energy bill 6 Customers feel they were provided useful information explaining their bills Goal 7 Customers were provided with information explaining their bill Tracking 8 Customers were provided with information and services to help reduce their energy bill Tracking Percent of CARE/FERA/Non-CARE customers on arrearage remains stable based on the average of last five years ( ) Percent of CARE/FERA/Non-CARE customers experiencing service disconnection remains stable based on the average of last five years ( ) Customers are provided with information and service to be able to avert service disconnection Tracking Tracking Tracking 12 Number of Rate Reform related escalated customer complaints (the IOUs will be coordinating with the Consumer Affairs Branch of the CPUC to determine how best to measure this) Tracking Number of community partners utilized to support rate outreach and education and number of people reached Number of events and presentations held in support of rate outreach and education and number of people reached Tracking Tracking 15 Percent of customers provided a personalized pricing plan comparison report Tracking 16 Open rates and click-through rates for rate education related s Tracking 17 Number of views to rate education webpages Tracking 18 Number of customers who have changed rates over the last quarter Tracking 19 Percent of customers on voluntary TOU rates Tracking 20 Percent of customers using bill comparison tools Tracking -121-

136 Metric # ORA s Recommended Rate Reform ME&O Metrics Metric ORA-Suggested Metrics Proportion of customers that are aware of the rate changes and potential impacts on their bills Website activity: length of time, # of pages visited, unique visitors, referrals to outside sites such as EUC Digest of featured stories in news and social media regarding Rate Reform Goal versus Tracking Goal Tracking Tracking C. Survey Approach 1. Baseline Survey Based on the proposed draft metrics, PG&E engaged Hiner and Partners (Hiner) in Q1 of 2016 to conduct a baseline ME&O survey. The intent of the survey was to track awareness, understanding and engagement with Rate Reform through the same core questions over the period leading up to TOU default and through default itself, at a minimum of twice yearly. The survey was administered to 1,000 residential customers, with oversampling among Tier 1/Tier 2 customers as well as potential High Usage Surcharge customers. This baseline ME&O survey 116 provides a starting point from which to measure the impact of Rate Reform communications, and is focused on the goal metrics listed below with the baseline survey results (see table below). 117 The Hiner Baseline ME&O Report concluded that residential customers show moderate to high awareness on the key metrics at this baseline stage early in the multi-year transition to default TOU. Some customers were exposed to Rate Reform communications in 2015, as well as media coverage around rate changes in California, and are therefore beginning to pay attention. However, customer awareness is quite low regarding specific details of the changes (e.g., that the number of tiers and the price difference between tiers is being reduced), and results show customers are starting from a place of confusion in that many are unsure of their rate structure, and some customers think that a High Usage Surcharge currently exists when it has yet to be 116 Rate Reform MEO Tracking Survey Report: Baseline, March 31, 2016, prepared by Hiner and Partners. 117 Note that some of these measures reflect awareness or yes/no agreement, whereas others show top 3 box agreement, or understanding, on a scale of 1-10 where 1 is don t agree/understand and 10 is agree/understand completely

137 introduced. Customers do appear to be aware that PG&E provides tools, tips and programs to help navigate the changes, but relatively few have taken any action. Corresponding Metric Summary Results From Baseline Study 118 Key Metrics and Measures General Population Response 1 Rate plans are available that may help you better manage any price increases 2 Know where to get information about assistance offered by PG&E 3 How to manage your electric bill using the rate plan that you are currently on 34% customers aware 63% customers agree 36% (a) customers understand statement and rate 8-10 on 1-10 scale; 5.79 (mean) 3 How changes to current rate plans mean you could be paying more unless you can adjust your electricity use 4 Lowering or shifting electricity use will: save money, reduce bill, improve reliability, help environment, manage price increases 34% (a) customers understand statement and rate 8-10 on 1-10 scale; 5.56 (mean) 41 to 51% (a) customers agree and rate 8-10 on 1-10 scale; 6.26 to 6.89 (mean) 5 Aware PG&E provides rebates, energy efficiency programs and tips 72% customers aware 6 Information was useful 44% (a) customers agree and rate 8-10 on 1-10 scale; 6.67 (mean) PG&E recently provided information about rebates, energy efficiency programs and tips 28% customers agree Took action as result of upcoming Rate Reform changes (a) Percent rating 8-10 on 1-10 scale. 12% customers aware of changes agree D. Alignment With Greenberg Blueprint Recommendation on Metrics The Greenberg Blueprint proposed 119 three high-level vision metrics for measuring progress towards the recommended vision for Rate Reform, with each of the three metrics being the responsibility of the recommended Statewide campaign, 118 Rate Reform MEO Tracking Survey Report: Baseline, March 31, 2016, prepared by Hiner and Partners. 119 RROIR MEO Blueprint: Integrated Marketing, Measurement, and Alignment Strategic Action Plan for Residential Rate Reform and TOU_V2, Greenberg, Inc, August 19, 2016, p

138 PG&E s campaign, or both entities. The Greenberg Blueprint proposed vision metrics include: a. Statewide: Affinity X% of Californian s feel a personal connection to electricity and feel strongly about being thoughtful about when they use energy. b. IOU: Retention X% of customers stay on TOU 15 months after default. c. Both: Sustained actions X% of Californians sustain at least one significant peak reduction action for 12 months after defaulting. PG&E s comments on each of these vision metrics are as follows: a. Affinity: PG&E is recommending that current statewide efforts be aligned and combined with Statewide ME&O, thus necessitating new objectives and strategies, and new metrics which may or may not include measurement of affinity. Until statewide decisions are made about the statewide campaign, it would be premature to discuss metrics at this level. b. Retention: The Greenberg Blueprint recommended a specific retention goal to be owned by the IOUs. PG&E proposes that while it is important to track TOU retention, at this early stage on the path to default TOU it is too soon to set a TOU retention goal metric, since PG&E is looking to the Default TOU Pilot to provide guidance on expected retention levels among defaulted customers. Also, PG&E s intention is to make sure customers are on the right rate for them by offering rate choices, thus PG&E considers rate satisfaction and awareness of rate choices (and whether the customer feels they are on the right rate for them) to be more appropriate metrics for assessing marketing effectiveness over time, not simply looking at retention. Indeed, the Greenberg Blueprint noted that rate satisfaction and awareness of rate choices are linked to retention, and PG&E agrees that these play key roles in an overall positive customer experience, which PG&E recommends as a new goal construct (Section E.1.3 below) c. Sustained actions: The Greenberg Blueprint has suggested that a specific sustained behavior change should be a goal metric for the IOUs and Statewide campaigns. While sustained behavior change is best measured via load impact studies and not via claimed behaviors, PG&E plans to include it in its study questions around specific shifting and conservation behaviors in the ME&O tracking survey, in addition to those already captured in the current questionnaire. E. Discussion of ME&O Survey-Based Metrics and Implications for the Survey Going forward, it is important to ensure that the survey-based measurements and metrics used to evaluate marketing for Rate Reform: Align with our ME&O goals Align with ME&O messaging and strategies Monitor marketing progress -124-

139 Reflect and are sensitive to individual target segment differences Adapt if strategy and course corrections are necessary PG&E s focus continues to be educating the customer to enable a positive customer experience as they engage with rate options and energy management tools leading up to, during and following default TOU. The Greenberg Blueprint recommended that of the six draft survey-based metrics proposed by the ME&O WG (see table above for survey-based metrics list), the first five should be retained since they will provide insight into the achievements of our strategy, but the sixth metric (customers feel they were provided useful information explaining their bills) should not be retained since it focuses on tactical achievements and not strategic goals. 120 PG&E feels that the perceived usefulness of the information provided is an important part of ensuring customer understanding of the implications of their rate and what actions they should take, thus PG&E would propose retaining that metric. In terms of additional goal metrics and the survey, PG&E is considering additional goal metric constructs going forward which have implications for survey content. Given the proposed educational strategy, PG&E believes many of the measures in the current survey are robust and will provide significant insights into the progress of Rate Reform and default TOU. PG&E intends to consider the addition of certain measurements to inform goal setting and ME&O optimization. 1. Goal Constructs for Discussion and Consideration are: a. Awareness of TOU: The Greenberg Blueprint recommended TOU awareness as a possible goal, and the Hiner ME&O baseline survey already measures specific awareness of TOU. In terms of TOU understanding, the implications of the rate change may be minimal or very mild for the majority of customers, but for those more impacted customers, they will need to understand the importance of thoughtful use of energy and what they can do to be successful in terms of conservation/shifting actions. 120 RROIR MEO Blueprint: Integrated Marketing, Measurement, and Alignment Strategic Action Plan for Residential Rate Reform and TOU_V2. Greenberg, Inc. August 19, 2016, p

140 b. Awareness of Rate Options: Awareness of rate choices, included in our survey, and understanding these options is also necessary for customer acceptance and satisfaction with their TOU rate, or another rate chosen pre or post-default. While ultimately PG&E wants to support its customers in remaining on TOU and shift as much load as possible to non-peak periods, there will be those default-eligible customers among the highly impacted for whom the default TOU rate could be burdensome. Measurement of rate retention will be important to monitor. Knowledge of and understanding of choice (which gives the customer more control) will serve to optimize the customer experience. PG&E s research studies have constantly shown that choice and a feeling of control are keys to customer satisfaction with their bill. c. A Positive Customer Experience: PG&E s ME&O strives to not only ensure customer acceptance but an optimal customer experience throughout the Rate Reform timeframe and beyond. The Greenberg Blueprint called out rate satisfaction as part of their retention vision metric. In survey terms this broad construct could encompass customer agreement that they are on the best rate for them, being confident that they are on the right rate, and/or being satisfied with their rate. Equally, a customer needs to feel that PG&E is providing them with the tools and information they need; communicating rate changes in a timely manner that it s easy to get help from PG&E; and other related areas. Finally, a positive customer experience is also a function of customer credibility and trust in PG&E, which is the messenger and deliverer of the experience. PG&E, therefore, is considering survey changes that reflect this important construct. 2. Draft Goal Metrics PG&E is proposing draft goal metrics as follows: -126-

141 Draft Goal Metrics No. Metric 1 Customers are aware that there are rate plans that may help them mitigate energy expenditures 2 Customers know where to go to get more information about how to manage their energy use 3 Customers understand how energy use can impact bills 4 Customers understand the benefits of lowering their energy use 5 Customers are aware of the rebates, energy efficiency programs, and tips offered by their utility that can help them manage their energy bill 6 Customers feel they were provided useful information explaining their bills 7 Customers are aware of TOU 8 Customers are aware of rate choices 9 Customer have an optimal experience Other areas PG&E is currently considering including in a survey, to more sensitively measure campaign success include: 1. Awareness and understanding of specific campaign/segment messaging 2. Intent to act 3. Specific shifting/conservation actions 4. Barriers to taking action Finally, with regard to numeric goal setting as it applies to the draft goal metrics captured by the survey: PG&E feels that it is premature at this stage of ME&O planning to state numeric goals with confidence since: PG&E is recommending new metrics in addition to those for which PG&E has gathered baseline results. This will necessitate changes to the survey instrument. PG&E will be looking to the results and feedback from the test-and-learns and pilots to provide guidance on specific goal setting. PG&E plans to address the process of numeric goal setting as expeditiously as possible, working in collaboration with the ME&O WG. F. Method and Timing of ME&O Study PG&E s recommendation is to continue with the current IOU surveying instrument, adding modifications where necessary, ensuring measures that are able to give strategic, actionable feedback for outreach optimization. The current surveying approach is by telephone; PG&E is considering a blended or mixed methodology phone and web surveying in the future, so that PG&E ensures incorporation of the -127-

142 younger end of residential customer target (difficult to reach by phone), and at the same time realize cost efficiencies. In terms of timing, PG&E proposes that the next wave of the ME&O tracking survey takes place in early 2017, rather than the original timing of Q The timing is based on the fact that there has been limited Rate Reform outreach to residential customers since the March 2016 baseline survey (Summer Heat campaign to highly impacted customers only), thus significant score shifts are not anticipated, plus response rates can be unpredictable during the holiday season. Also, the study questionnaire needs to be optimized for new metrics/content and reviewed by the ME&O WG. Finally, PG&E s Rate Comparison Impact survey (immediately after the October/November 2016 test-and-learn) utilizes the majority of the ME&O tracking study questionnaire, thus our control group results can be viewed as a proxy for an end-of-year wave of the ME&O study. Going forward, PG&E proposes the following survey frequency and timing over the next four years: Survey Timing and Frequency February, September February, October March, July, November February, June, October Surveys become more frequent around the default date, through the rollout of default TOU and as bill protection ends. PG&E proposes three surveys per year beginning in 2019 (sample size 1,000 minimum, general population, with relevant added oversamples of specific segments where appropriate) are enough to sensitively monitor outreach effectiveness. The Greenberg Blueprint suggested Pulse Surveys around the time of default to measure awareness and responses to TOU. PG&E will consider the need for real-time feedback via supplemental pulse surveys, after it reviews the results of the Default TOU Pilot. 1. Understanding our Customer: Segment-Specific Outreach and Surveys PG&E agrees that it is critical to ensure that the measurement approach reflects and supports the way customers are segmented. The adopted approach needs to: (a) be sensitive to key customer segment market movements in terms of awareness, -128-

143 understanding and engagement, and (b) enable better understanding of the use of certain segmentation approaches in improving customer awareness, understanding and engagement, and whether such approaches are effective in making communications more customer-relevant. Key segments from a measurement perspective include: Rate impact (Benefiters, Neutrals, Non-Benefiters) Usage-based segments such as High Usage Surcharge customers, T1 and T2 customers Low-income, hard-to-reach, Seniors Psychographics or specific personas/persona clusters PG&E can measure specific segments through several approaches: a. Via the ME&O survey among the general PG&E residential population: Results from our baseline survey of March 2016 enabled PG&E to evaluate segmentspecific responses. Within the general population survey PG&E is able to evaluate the results among segments such as low income/care customers versus non-care customers. b. Via oversampling segments within the ME&O survey: For other smaller segments of interest (e.g., High Usage Surcharge and low usage Tier 1 and Tier 2 customers who represent under 7% and under 20% customers respectively), PG&E oversampled these groups in the baseline survey in order to obtain more accurate measures of awareness, understanding and engagement among these groups. Going forward, PG&E can continue to oversample these segments and others, where appropriate and according to outreach efforts. c. Via ad hoc studies: PG&E plans to leverage ad hoc studies that focus on segment-specific responses to specific outreach. Examples of these planned studies are as follows: 1. Rate Comparison Impact Survey PG&E plans to measure the ability of rate comparisons to increase customer awareness, understanding and engagement with rate options. PG&E already has begun its approved test and learn for the Rate Comparison Reports. These are being carried out in two waves, in October and November 2016, among a sample of residential customers (approximately 160,000 customers across the two waves). These customers have been divided into those who usually receive paper bills and those who have signed up for paperless billing, with a further segmentation of customers by bill impact (Benefiters, Neutrals and Non-Benefiters). There is a further segmentation of the paperless billing customers by message type: financially-based messaging, -129-

144 green-based messaging, and responsibility-based messaging. PG&E plans to complete its follow-on research surveys immediately after the outreach has been received by these customers to see if exposure to their rate comparisons has impacted their engagement with rates. Whereas PG&E has baseline measures (of rate option awareness and understanding) from the ME&O survey in March, PG&E plans to survey customers exposed to the rate comparisons (paperless and paper bill customers the treatment group) as well as a control group of customers who have not been exposed to the rate comparison outreach. The control group will reflect the make-up of the treatment group in that these will comprise paper bill customers and paperless billing customers similarly divided by impact. Surveying will be done by phone and online, and will cover key questions from the ME&O survey around customer knowledge/understanding of rates and rate options, and understanding of bill impacts, as well as additional message-specific questions, actions they took as a result of seeing the rate comparisons, and the customer experience. The results of this survey should be available by December TOU Acquisition Research PG&E plans to measure the effectiveness of initial voluntary TOU acquisition outreach efforts (planned for Q1 2017) in terms of impact on the customer. This will take the form of quantitative research, done after initial acquisition marketing, to explore customer awareness, understanding of and engagement with the TOU outreach. The outreach will be going to different customer impact segments defined primarily in terms of their level of financial benefit in joining a TOU rate, as well as CARE/non-CARE populations. The research will compare customers who received the outreach (treatment) versus a control sample who match the targeted customers in terms of characteristics but did not receive the outreach. During this survey PG&E will also evaluate customer understanding and engagement through the lens of personas, to understand whether certain customer personas were impacted more than others. 3. Other research studies PG&E believes it is critical to utilize research studies to better understand the customer as the full rollout of default TOU approaches. In addition to the ME&O survey and key initiative studies already identified and discussed, PG&E will be planning additional research to keep its finger on the pulse of the customer and illuminate how future outreach can be made more effective. PG&E intend to leverage both qualitative -130-

145 and quantitative approaches to research. PG&E plans to leverage qualitative methodologies such as focus groups and in-depth interviews to optimize the effectiveness of our outreach (in terms of language used, clarity, relevance and tonal appropriateness), as well as examining how our marketing materials have been understood by customers. PG&E also plans to utilize its Customer Voice Panel, (consisting of 15,000 residential customers with addresses, who have agreed to participate in PG&E surveys), as well as other quantitative approaches to optimize creative and also examine the customer impact of marketing materials. G. Tracking Outreach Efforts The particular metrics agreed by the ME&O WG to track information, tools and solutions provided to customers is identified in the chart below: Tracking Metrics to Monitor Rate Reform Metric # Metric Goal versus Tracking 7 Customers were provided with information explaining their bill Tracking Customers were provided with information and services to help reduce their energy bill Customers are provided with information and services to be able to avert service disconnection Number of community partners utilized to support Rate Education outreach and education and number of people reached Number of events and presentations held in support of Rate Education outreach and education and number of people reached Percent of customers provided a personalized pricing plan comparison report Tracking Tracking Tracking Tracking Tracking PG&E plans to track customer communications to provide a view of outbound communications and customer reactions using various test and learn methodologies (e.g., A/B testing), along with scores to help the Company understand: How are communications contributing to generating awareness? How are communications increasing the level of understanding? Are Rate Reform communications encouraging customers to take action? Overall, what is the impact of Rate Reform messaging on engagement, product adoption and satisfaction? -131-

146 Additionally, PG&E is tracking integrated activity (the type and amount of coordination or co-marketing with other ME&O programs), how it affects response at the program level and whether customers are more or less apt to respond to a program communication when Rate Reform is included. Every integrated activity is reported out in the IDSM Quarterly Report. H. Tracking Community-Based Outreach Efforts Similar to the Greenberg Blueprint, PG&E acknowledges that a community engagement strategy is complementary to conventional marketing efforts. Working closely with CBOs and leaders provides deeper one-to-one education on rate change, tools and options. However, both the Greenberg Blueprint and PG&E recognize the limitations of CBOs capacities, funding, staffing and capabilities. These organizations are designed to be resources within a community to address specific societal problems. This focused approach can limit the organizations ability to provide broad outreach on non-mission-driven issues like rate change and awareness. With this understanding, PG&E works with these groups as partners who can deepen engagement, follow-up on existing marketing collateral, and help clarify messages. In turn, PG&E s measurement and evaluation of these groups reflects those expectations. Outreach goals may appear to be modest, but are truly commensurate with the capacity of community groups to do this work. The Community Engagement team currently monitors CBOs residential rate efforts in the following ways: -132-

147 Channel CARE Community Outreach Contractors LIHEAP REACH Health Outreach Workers Initiative After-school Initiative (Energenius) Community Ambassadors Communities of Color Advisory Group Tracking Number of Community Partners Number of contracts Number of CE Partners Program Manager tracks Number of CE Partners Contract with program administrator Number of CE Partners Contract with program administrator Number of CE Partners Contract with program administrator Number of CE Partners Number of contracts with Community Ambassador Number of CE Partners Number of member organizations represented in the Advisory Group Number of CE Partners Tracking Number of People Reached Track number of CBO staff trained on residential rate awareness Track number of events Track number of people touched at each event Track number of CBO staff trained on residential rate awareness Track number of CBO staff trained on residential rate awareness Track number of CBO staff trained Track number of events Track number of people touched at each event Track number of CBO staff trained Track number of events Track number of people touched at each event Track number of CBO staff trained Track number of events Track number of people touched at each event Track number of attendees at each advisory group meeting For Residential Rate Reform awareness, PG&E outlines below the proposed outcomes and activities for community partners. Community partners will engage in the following outcomes and activities: Outcome 1: Increase awareness of rate options. Outcome 2: Increase outreach on low-income assistance programs. Outcome 3: Increase customer outreach via workshops, events and door-to-door campaigns. Eleven CBOs have received GRC funding through PG&E to conduct Residential Rate Awareness outreach work on behalf of the utility. They will be reporting their results by capturing the following metrics: Number of events Type of event (community event, community workshop or door-to-door campaign) -133-

148 Ethnicities targeted Languages targeted Number of customers touched on Residential Rate options Number of customers touched on how to manage energy use (Energy Alerts, etc.) Number of customers touched on the ESA Program Number of customers touched on energy resource assistance programs (REACH, Medical Baseline) Number of customers touched on CARE In addition, CBOs are being required to submit a narrative report that captures customer complaints and resolutions as it relates to this outreach activity. I. Tracking Engagement and Customer Actions Tracking which actions did customers take as a result of outreach and messaging (i.e., their engagement with PG&E s tools and programs, as well as other resulting customer consequences) is key to understanding ME&O effectiveness. The draft metrics, which fall into this category, identified by the WG are shown below: Metric # Tracking Engagement and Customer Actions Metric Percent of CARE/FERA/Non-CARE customers on arrearage remains stable based on the average of last five years ( ) Percent of CARE/FERA/Non-CARE customers experiencing service disconnection remains stable based on the average of last five years ( ) Number of rate reform related escalated customer complaints (the IOUs will be coordinating with the Consumer Affairs Branch of the CPUC to determine how best to measure this) Goal versus Tracking Tracking Tracking Tracking 16 Open rates and click-through rates for Rate Reform education related s Tracking 17 Number of views to rate education webpages Tracking 18 Number of customers who have changed rates over the last quarter Tracking 19 Percent of customers on voluntary TOU rates Tracking 20 Percentage of customers using bill comparison tool Tracking N/A 121 Percentage of customers in the super user category Tracking 121 There is no metric for this that corresponds to the list of WG recommended metrics. This tracking metric was required by the December 17, 2015 ALJ ruling

149 In addition to tracking whether customers change their rate, PG&E also plans to track the percentage of High Usage Surcharge customers. The impact of communications on customers actions can be inferred by viewing post-communication pursuits that generate understanding as well as rate change related actions taken. a. Open and click-through rates on Rate Reform s b. Visits to rate education webpages c. Visits to energy management tips webpages Trends of key metrics will be tracked over time to show correlation between marketing, awareness of Rate Reform and customer behavior. To aid in this effort and enable greater insight, customer behavior will be tracked and scoring algorithms will be created to further understand a customer s experience with marketing outreach along with their overall level of engagement. One of the scores is intended to yield insights into the degree of communications the customer is experiencing related to rate change. This will help PG&E correlate outreach and education to changes in customer awareness, perception and behavior. Anticipated outcomes include insights into a customer s responsiveness to communications, effectiveness of the communications, and recommendations for optimizing marketing spend across various groups of customers. Another area where scores can lead to valuable insights will be around a customer s overall relationship with PG&E. PG&E can begin to understand what is their level-of-engagement, what are their channel preferences and how PG&E outreach communications are impacting behavior. The goal is to gain learning around changing customer conditions and other outside influences that may impact their engagement overall. These types of insights will be important to integrate with any psychographic learning in order to best understand how to communicate with customers. In addition, this information will be leveraged to further inform the segments and micro-targets for more personalized, targeted messaging. Finally, the learning from a combination of the scores will aid in measuring a customer s level of engagement with energy management programs at PG&E by assessing the depth and breadth of energy efficiency engagement along the customer s journey where possible. The ultimate end use will be to drive customers from initial awareness to higher levels of understanding and engagement with energy management

150 This will be used in conjunction with the existing Energy Efficiency Opportunity Score (EEOS) to pinpoint the customers with the most opportunity at each stage of their engagement journey, and will be useful for building journey-related automated marketing campaigns in direct channels. Another means of measuring customer engagement will be the use of test and control both with a Universal Test and Control combined with individual campaign test and controls. The Universal Test and Control groups at PG&E are the means to measure the full impact of all combined marketing communications. This enables PG&E to quantify the impact of marketing on such metrics as overall program engagement, new program adoptions and energy usage. The Universal Test and Control groups work by randomly selecting a sample of marketable residential customers who are assigned for 24 months to either the test or control group. The control group is suppressed from all marketing communication, but continues to receive operational communications and is eligible for customer research communications. The customers in the Universal Test group continue to receive communications normally. When it becomes time to measure, these two groups (Test and Control) are compared to each other in order to understand the lift in engagement between those who received overall communications (Test) and no communications (Control). This lift measures the customer engagement of the combined efforts and overall efficacy of the direct-to-customer marketing efforts. For example, in Q2 of 2016 there was a focused increase and investment in marketing communication for CARE customers. At the end of Q2, the Universal Control and Test results showed a statistically significant difference (at the 95% confidence interval) in new engagement in CARE between those who had received the direct-to-customer marketing, and those who had not and were in the control group. This indicates that the marketing overall helped drive the success of this CARE engagement. The Universal Test and Control groups do not replace the need for standard campaign control groups to measure the impact of each individual campaign, but rather to measure the cumulative impact of all the campaigns together. In order to understand if a specific campaign was effective, standard control groups should be withheld from communications to compare to those that received that communication

151 XI. Budget A. Introductory Caveats The rate transition set in motion by D , including both tier flattening and a new High Usage Surcharge, as well as moving millions of residential customers to default TOU, is a huge and complex undertaking necessitating communications of a type that PG&E has never done before. Accordingly, it is not possible at this early stage to predict with precision the level of its ultimate, actual costs. There are many unknowns, including: (1) how the CPUC will resolve remaining issues under Pub. Util. Code Section 745, (2) what structure and timing the CPUC will adopt for the full-scale roll-out of default TOU to be proposed in the IOUs 2018 RDW Applications, (3) what type of statewide marketing takes place, (4) when, as well as what lessons will be learned after data is collected from the Opt-In and Default TOU Pilots, and (5) as well as from other early test and learn ME&O efforts, among other things. The ultimate outcomes on any one of these unknowns could result in significant cost changes that might either increase or decrease any of the elements PG&E has attempted to forecast in these preliminary budget estimates. PG&E reserves the right to update this budget as such unknowns are resolved. It should also be noted that a start-up effort such as this one, is likely to have somewhat higher costs in the early years. PG&E s marketing department is data-driven, and until results from early efforts are received and analyzed, it cannot be known whether future changes to this plan might be deemed to be necessary, in order to support a successful roll-out of default TOU, and if so, whether such changes would result in a net increase or decrease in costs relative to this preliminary proposed budget estimate. PG&E designed the framework of its ME&O plan to both support a successful rollout of default TOU while also aiming to do so at a reasonable cost and is committed to continuously looking for additional cost-savings. PG&E is pleased that it was able to optimize its ME&O plan so as to result in an estimated budget that is far lower than what was projected in the Greenberg Blueprint, while still remaining focused on the goal of generating awareness and understanding among customers regarding their rate options, choosing the right rate plan for them, and what they can do to better manage their use and ultimately their bill

152 B. PG&E s Preliminary RROIR ME&O Budget Estimates PG&E is providing preliminary proposed cost estimates for currently anticipated activities related to ME&O and other supporting activities to prepare customers for residential rate changes in PG&E s territory. In the table below, PG&E has included estimates of PG&E s likely incremental labor and third-party contract costs relating to ME&O activities that are to be recovered through the 2017 GRC Settlement filed on August 3, 2016 Application The estimates include: Summer and winter campaigns; Rate options; Voluntary TOU acquisition; Full-scale default in 2019; Development of tools for customer education; Contact center support; Ongoing customer research; Marketing effectiveness studies; and Pro-rated portion of the expected Salesforce Marketing Cloud automation platform including the addition of Salesforce s Journey Builder, Advertising Studio, and Social Studio, which are being added to further enhance marketing automation as discussed in Chapter XII. PG&E s budget estimates do not include statewide outreach costs, which are proposed to be decided in a separate Advice Letter filing after further consideration and coordination efforts with the ME&O WG. Also, the Opt-In Pilot is not included as it is already underway. Further the Default TOU Pilot ME&O costs are not included in this budget as that will be discussed in PG&E s Default TOU Pilot Advice Letter to be filed on December 16, In addition, these preliminary estimates also do not include the costs associated with ongoing outreach and education activities after customers default to TOU rates. 122 PG&E s ME&O costs for the Default TOU Pilot are not included in this budget as PG&E will include that in the December 16, 2016 Advice Letter. PG&E s ME&O costs for the Opt-In TOU pilot are already being recorded in the memorandum account per Resolution E

153 C. PG&E s Preliminary, Utility-Specific RROIR ME&O Budget Estimates PG&E s preliminary estimate of the costs for the ME&O activities that it currently envisions for 2017 is $11,964,582, with an estimated increase of $3,767,995 in 2018, and increase of $5,515,799 in 2019, for an estimated total of $15,732,577 in 2018 and $21,248,376 in All costs are based on assumptions for ME&O activities planned for 2017, 2018, and These costs are subject to change based on the final outcomes on various unresolved factors previously identified. PG&E will report its actual ME&O costs incurred for these activities, in its quarterly PRRR reports. 123 Tactic PG&E s ME&O Budget Estimates for Years Location in Filing 2017 Proposed Budget 2018 Proposed Budget 2019 Proposed Budget Overall Plan Chapter VI $5,047,580 $5,436,580 $7,446,580 Voluntary TOU Chapter VIII A 950, ,500 Default TOU Chapter VIII B 1,051,000 5,505,000 Public Relations/Employee Chapter VIII C 595, , ,000 Communications Web Development Chapter VIII C 150, , ,000 (Inclusive of all activities) Support Channels (Contact Chapter VIII C 500,000 2,842,195 2,843,153 Centers) Customer Research Chapter X 436, , ,000 Community-Based Chapter IX 397, , ,500 Organizations Marketing Automation Chapter VII 238, , ,982 Measurement & Reporting Chapter X 250, , ,000 High Usage Surcharge Chapter IV 700, , ,000 (Super User) PG&E Labor (Marketing & N/A Customer Insight) 2,700,000 2,772,000 2,846,160 Total $11,964,582 $15,732,577 $21,248,376 As an integral part of Residential Rate Reform, PG&E plans to leverage other programmatic marketing efforts to integrate communications about residential rate options with other PG&E programs and services, if and as appropriate. The marketing of rate options, tips, and tools will be cross-promoted with Residential Energy Efficiency, Demand Response (Smart AC), Solar Choice, CARE, and ESA, and other PG&E program communications, where applicable. The total costs associated with the outreach efforts proposed in this plan have been captured in these budget estimates. 123 D , p

154 However, PG&E plans to leverage the budgets authorized in other proceedings to co-fund integrated outreach efforts and cross-promotion opportunities. PG&E will record its actual costs incurred to carry out this plan in its RROIR Memorandum Account for tracking. In PG&E s 2017 GRC Phase I, a settlement was reached, which is pending resolution before the CPUC. If adopted, the settlement would allow PG&E to seek recovery of up to a total of $57.9 million in costs booked to the Residential Rate Reform Memorandum Account for the period through the Annual Electric True-up filings for those years. The settlement would also authorize PG&E to seek recovery of additional costs for those years through a Tier 3 advice filing. 124 The preliminary budget estimates set forth in the table above are subject to change due to a variety of factors, including if: The CPUC s Resolution approving this Advice Letter is delayed and outreach activities do not commence as planned starting in Revisions are required as part of the CPUC s Resolution approving this Advice Letter Subsequent CPUC decisions resolving remaining issues under Pub. Util. Code Section 745, and approving the final TOU default rate differ from the assumptions made in developing this plan There are changes in the number of excluded customers, and/or most impacted customers over the course of the three-year cycle. As stated above, PG&E reserves the right to make adjustments to this preliminary ME&O plan, including those necessary to capture additional lessons learned, or findings from customer research from the Opt-In TOU and Default TOU Pilots. Changes to the marketing channels or their associated costs throughout 2017 to 2019-including direct mail, , digital media, and telephone outreach, among others, could affect the 124 A , Joint Motion of Office of Ratepayer Advocates, The Utility Reform Network, Alliance for Nuclear Responsibility, Center for Accessible Technology, Coalition of California Utility Employees, Collaborative Approaches to Utility Safety Enforcement, Consumer Federation of California, Environmental Defense Fund, Marin Clean Energy, Merced Irrigation District, Modesto Irrigation District, National Diversity Coalition, Small Business Utility Advocates, South San Joaquin Irrigation District, and Pacific Gas and Electric Company for Adoption of Settlement, Attachment 1, pp. 1-8 and 1-9, Section , Residential Rates Reform Memorandum Account: 2017 and Beyond Costs

155 overall ME&O expenditures. PG&E will report its actual ME&O costs, incurred for these activities, in its quarterly PRRR reports. 125 XII. Marketing Automation A. Current Marketing Automation PG&E agrees that default TOU requires targeting the right people as stated in the Greenberg Blueprint 126 and has previously discussed how PG&E is already using automation tools to assist with targeting the right customers at the right time with the right messages with the Greenberg team. Today, PG&E uses the Salesforce Marketing Cloud to automate and SMS/text campaigns. This platform helps optimize and personalize connections with customers more effectively than ever before. The software solution allows PG&E to engage customers with promotional, transactional and triggered marketing campaigns. PG&E can automate and personalize messages, thereby generating greater trust with our customers as Energy Advisors through relevant and timely information and solutions. The feature set provides the ability to build and send personalized (including in-language), from basic newsletters to the most complex campaigns. Included with the platform are tools that allow PG&E to track and optimize campaigns, which then drive higher performance. The process starts with leveraging data inputs like behavioral, psychographic and robust usage data to create timely and highly relevant messages that allow PG&E to engage and re-engage customers. Built into the platform are tools that guide our marketing professionals through the deployment system and allow for pre-campaign testing to reduce errors. One of the many differences from a traditional platform is the ability to use dynamic and predictive content to create highly personalized messages that drive action. Something as simple as placing the customer s city in the subject line has increased unique opens by 4.8% over 2015 in recent campaigns. PG&E also utilizes the software s A/B testing feature that allows the Company to perform split testing of two different versions of content or subject lines and provides real-time feedback on the most engaging content and messages. PG&E 125 D , mimeo, p RROIR MEO Blueprint: Integrated Marketing, Measurement, and Alignment Strategic Action Plan for Residential Rate Reform and TOU_V2. Greenberg, Inc. August 19, 2016, p

156 currently has the ability to automate a significant amount of the process, from data imports and sends to scheduled reports, which increase our efficiency and ability to make smarter decisions. PG&E can analyze its efforts at every step and can define specific goals for each campaign and measure everything including click-through rates, timing, channels, conversions and more. One of the biggest benefits of utilizing the Salesforce Marketing Cloud platform is the ability to automate campaigns as PG&E has with the CARE Program. The platform allows PG&E to scale campaigns by automating sending, data imports and reporting. One of the reasons PG&E chose the Salesforce platform is their ability to provide high volume sending and unbeatable deliverability through spam detects that scan every for content that might prevent delivery to the recipient s inbox. B. Future Marketing Automation PG&E is in the process of enhancing the Salesforce Marketing Cloud with greater automation through Journey Builder, Advertising Studio and Social Studio add-on software. 1. Journey Builder Journey Builder will allow PG&E to automate customer journeys across channels leading to a more seamless and effortless experience. The add-on software listens for customer cues such as an open or form completion, and then triggers additional communication based on that particular behavior. By listening across multiple platforms, PG&E will be able to deliver more personalized journeys among a variety of channels, devices and touchpoints. One example of how PG&E might use Journey Builder for customers negatively impacted by Rate Reform is to create a customer journey by grouping similar customers into a one contact list, which may include: a) An to entice customers to setup an online account. Salesforce would capture all those customers who click-through the and sign-up for an online account. b) A follow-up could be triggered within the hour congratulating the customer on their first step towards Energy Understanding and encourage them to take the next step a Home Energy Checkup. c) For those customers who open the but do not click-through to the website, an automated can be sent three days after open encouraging them to take the Home Energy Checkup. d) For those customers who again open the but do not click-through to the website, a third can be sent. However, this may also ask if they -142-

157 need assistance and if they prefer to communicate via SMS/text, telephone or direct mail (or all three). Additionally, Journey Builder will provide even greater analytics so PG&E can continue to optimize the customer experience. PG&E will be able to define specific goals and measure everything from click-through rates, timing, channels and conversations. The Marketing Department will be able to evaluate the effectiveness and efficiency of the journeys and continue to optimize the campaign for even greater performance. 2. Advertising Studio The Advertising Studio will allow PG&E to activate its customer data, and reach target audiences to find new prospects to engage in rates and energy management discussions, re-engage inactive customers with energy management offerings, and connect our digital advertising with the rest of PG&E s marketing within the customer journey. The Advertising Studio will enable PG&E to use , mobile and website data to target ads to existing customers on Facebook, Instagram, Twitter, LinkedIn and mobile publishers, so that PG&E can continue to enhance our ability to meet customers where they are instead of trying to get them to come to PG&E. An example of how this might be used is for driving acquisition of in-language bills. Advertising Studio could be utilized to market directly to customers in-language within Facebook and Google promoting in-language bills. A form will appear directly in Facebook and Google with pre-populated data that can allow customers to submit a request to opt-in to in-language bills without leaving the social network. This data has the ability to write directly back to Salesforce and could then be pushed back to PG&E s primary marketing database. 3. Social Studio Even more exciting is the Social Studio because it can take these efforts even further and advance the goal of creating a consistent customer experience by integrating social media activity with marketing on a single platform. Social Studio provides the capability to monitor billions of conversation topics and proactively identify customers looking for help. For example, if a customer is lamenting about the high cost of their PG&E energy bill on social media, PG&E can serve up messages to that customer across multiple channels featuring tips, rate options, tools and programs. This tool will also enable PG&E to unlock deeper insights about customers such as -143-

158 sentiment, influencers and detractors, which will assist the Company in better understanding of customers in the moment, and monitor trends as they arise. PG&E agrees with the Greenberg Blueprint that marketing automation is necessary to execute a real-time, relationship-oriented approach for both maintaining and extending customer engagement. PG&E currently has many of the necessary capabilities in place with the Salesforce Marketing Cloud platform, but with the addition of Journey Builder, Advertising Studio and Social Studio, by the end of 2016, 127 PG&E will be well positioned to close the loop and take our automated efforts to the next level in time for the transition to default TOU rates. 127 Currently, the Salesforce Marketing Cloud is funded by various PG&E programs that are utilizing communications. This will remain an annual cost going forward. Journey Builder, Advertising Studio and Social Studio are add-on units within the platform needed to expand our efforts of marketing automation for which residential rate funding will share a portion of. Costs are estimated at 25% of the Salesforce Marketing Cloud platform and 50% of the three add-on unit s annual costs

159 PACIFIC GAS AND ELECTRIC COMPANY APPENDIX A PG&E CONTACT CENTER OPERATIONS RATE REFORM CALL VOLUME

160 Appendix A PG&E Contact Center Operations Rate Reform Call Volume A-1

161 PACIFIC GAS AND ELECTRIC COMPANY APPENDIX B RESIDENTIAL RATE REFORM MARKETING PLAN PROPOSED TIMELINE

162 Residential Rate Reform Marketing Plan - Proposed Timeline* OVER-ARCHING PLAN Tips & Tools Campaign Digital Media /Digital Newsletter Energy Statement Package Call Center On-Hold Messages Local Office Outreach Community-Based Organization Outreach Pre-Winter/Pre-Summer Campaign Digital Ethnic Print Direct Mail Digital Newsletters Engagement Tests Gamification Rewards Energy Engagement Kits Engagement Campaigns Online Account Acquisition Specialized Energy Statements 2017 TEST AND LEARN 2018 SCALE AND OPTIMIZE 2019 DEFAULT ENGAGEMENT Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 ALL TACTICS (Summer) DIGITAL MEDIA /DIGITAL NEWSLETTER ENERGY STATEMENT PACKAGE CALL CENTER ON-HOLD MESSAGES LOCAL OFFICE OUTREACH COMMUNITY-BASED ORGANIZATION OUTREACH ALL TACTICS (Winter) ALL TACTICS (Summer) GAMIFICATION REWARDS ENERGY ENGAGEMENT KITS ONLINE ACCOUNT ACQUISITION SPECIALIZED ENERGY STATEMENTS ALL TACTICS (Winter) ALL TACTICS (Summer) ALL TACTICS (Winter) VOLUNTARY TOU Direct Mail/ /Calls Digital Media Energy Statement Rate Comparison ALL TACTICS DIRECT MAIL CALLS DIGITAL MEDIA ENERGY STATEMENT RATE COMPARISON ALL TACTICS Ineligibility Energy Statement Mailing/Calls ENERGY STATEMENT MAILING/CALLS DEFAULT TOU Direct Mail/ /Calls/Teletown Hall Energy Statement Messages Energy Statement Rate Comparison Digital Media DIRECT MAIL CALLS ENERGY STATEMENT MESSAGES ENERGY STATEMENT RATE COMPARISON DIGITAL MEDIA OTHER INITIATIVES High Usage Surcharge Direct Mail High Usage Tiered Collapse and High Usage Bill Insert BILL INSERT DIRECT MAIL CHANNELS pge.com Energy Statement Package Digital Newsletter Call Center Hold Message Community-Based Outreach pge.com ENERGY STATEMENT PACKAGE DIGITAL NEWSLETTER CALL CENTER HOLD MESSAGE COMMUNITY-BASED OUTREACH *PG&E s proposed timeline is subject to change based on approval of PG&E s marketing plan. Lessons learned from the Opt-In and default TOU pilots will inform best practices and implementation planning. B-1

163 PACIFIC GAS AND ELECTRIC COMPANY APPENDIX C RATE REFORM MARKETING, EDUCATION AND OUTREACH TRACKING SURVEY REPORT

164 Rate Reform Marketing, Education and Outreach Tracking Survey Report Baseline C-1 March 31, 2016

165 2 Table of Contents C-2 Background, Objectives, and Methodology. 3 Executive Summary 6 Key Findings Awareness of Rate Plan Types Awareness of Rate Reform and Recent Communications 14 Understanding Rate Reform and Transition Changes 30 Knowledge About PG&E Assistance Actions Taken as a Result of Rate Reform Changes.. 44 Overall Evaluation of PG&E 51 Demographics 54

166 This survey has been designed around the draft key metrics as shown in the table below. 6 Customers feel they were provided useful information explaining their bills C-3 Background & Metrics PG&E, along with other California IOUs, is communicating to its residential customers about rate reform and changes to rates such that customers will be prepared for the transition to a Time-of-Use rate in Metric # Description Customers are aware that there are rate plans that may help them mitigate energy expenditures Customers know where to go to get more information about how to manage their energy use Customers understand how energy use can impact bills (based on the rate plan they re on) 4 Customers understand the benefits of lowering their energy use 5 Customers are aware of the rebates, energy efficiency programs, and tips offered by their utility that can help them manage their energy bill 3

167 C-4 Objectives Research objectives of the tracking survey include: a) Measurement of customer perceptions of rate reform changes including: Awareness Reduction in tiers and the price difference between tiers; addition of a high user surcharge (SUE); transition to TOU; availability of tools to manage and make choices regarding the changes Understanding How the changes will impact customer s bill; reasons for the changes; TOU transition and its benefits; which programs, tools, and tips to help save money Engagement Actions taken around rate reform changes/tou/tools: e.g. changed electricity use behavior, chose a new rate, looked at a rate comparison, went to PGE.com or called PG&E b) Tracking of Key Metrics/Goals Metrics 1 through 6 (1) Customers are aware that there are rate plans that may help them mitigate energy expenditures (2) Customers know where to go to get more information about how to manage their energy use (3) Customers understand how energy use can impact bills (based on the rate plan they re on) (4) Customers understand the benefits of lowering their energy use (5) Customers are aware of the rebates, energy efficiency programs, and tips offered by their utility that can help them manage their energy bill (6) Customers feel they were provided useful information explaining their bills 4

168 Completed Interviews 1, Survey Length Incidence 81% 81% 81% 84% 5 Methodology C-5 PG&E, with HINER & Partners, conducted a telephone survey among a general population sample of 1,000 residential customers. Including proportional representation of CARE, NEM, and demographic-based subgroups: all age groups including seniors, income groups including low income, households with a disabled person, and others. Climate areas are represented by: Hot (zones P, R, S, W), Moderate (Q, X, Y), and Cool (T, V, Z). Oversamples were completed among Tier 1/Tier 2 customers and SUE customers to ensure sufficient sample sizes among these groups. SUE customers were defined as 350% of baseline in one or more of the previous 12 months. Customers were called and screened to interview the person in the household who usually reviews and/or pays their monthly PG&E bill. Survey details include: General Population Baseline Tier 1/ Tier 2 Tier 3/ Tier 4 SUE Interviewing Began February 24, Interviewing Completed March 15, Participation Rate 48%

169 Executive Summary: Overview of Metrics C-6 The baseline MEO tracking survey provides a starting point from which to measure the impacts of rate reform communications. It is focused on key metrics, some of which already show relatively high awareness or knowledge among residential customers. Over half (55%) of residential customers say they ve heard of TOU, and one in four (27%) have heard about upcoming rate plan changes. Interest in switching to a TOU rate plan (among those who say they are not on a TOU) is moderate, with 44% claiming they are very or somewhat interested. Note that customers are confused about rates - 49% customers are not sure which type of rate plan they are on. Metric 1: One-third (34%) say they are aware that rate plans are available that may help you better manage any price increases. However, more customers (50%) are aware that rate plans are available that could help you save money. Metric 3: Slightly fewer have high understanding of: how to manage your electric bill using the rate plan you are currently on (36%), and how changes to current rate plans mean you could be paying more unless you can adjust your electricity use (34%). One in five (22%) also say they are aware of the reasons for the transition, with top reasons being: encourage energy savings, upgrade infrastructure, and reduce environmental impacts. Metric 4: Residential customers have relatively high knowledge of the impacts of reducing or shifting their electricity use, with high agreement (ranging from 41% to 51%) that these actions will: save money, reduce your bill, improve reliability, help the environment, and help you manage for price increases. Metric 6: One in four (23%) said they have received information about how upcoming rate changes will impact their monthly bill, and almost half of these (44% rating 8-10) said the information was very useful. Metric 5: Three out of four (72%) are aware that PG&E provides rebates, energy efficiency programs, and tips to help save energy and money on their bill, though fewer (28%) said they recently received this. Metric 2: Two out of three (63%) also said they know where to get this type of information (most mentioned PGE.com). 12% said they ve taken action as a result of upcoming changes. 6

170 In sum, residential customers show moderate to high awareness on the key metrics. Some customers have been exposed to rate reform communications in 2015, as well as media coverage around rate changes in California, and are therefore beginning to pay attention. However, customer awareness is quite low regarding specific details of the changes (e.g., that the number of tiers and the price difference between tiers is being reduced), and results show customers are starting from a place of confusion in that many are unsure of their rate structure, and some customers think that a high usage surcharge currently exists when it has yet to be introduced. Customers do appear to be aware that PG&E provides tools, tips and programs to help navigate the changes, but relatively few have taken any action. Going forward, monitoring awareness, understanding and engagement around rate changes via this study will aid PG&E in the development of attention-getting, relevant and informative education and outreach and help define communications effectiveness and success. Executive Summary: Overview C-7 7

171 - Aware of TOU (RA1) 55% Non-CARE > CARE, NEM > Non-NEM - Heard of rate plan changes (AW1) 27% NEM > Non-NEM, Hot & Cool > Moderate - Received bill impact information (UN5) 23% Tier 1/2 & Tier 3/4 > SUE, Cool > Hot & Moderate 8 Key Measures: Overview C-8 Metric Key Measures (with question #) General Population Comments - Interest in switching to TOU (RA3) 14%*, 3.89 (mean) SUE > T 3/4 > T 1/2 1 Rate plans are available that may help you better manage any price increases (AW2) 34% 3 How to manage your electric bill using the rate plan that you are currently on (UN1) 36%*, 5.79 (mean) Tier 1/2 > SUE, NEM > Non-NEM 3 How changes to current rate plans mean you could be paying more unless you can adjust your electricity use (UN1) 34%*, 5.56 (mean) Tier 1/2 & Tier 3/4 > SUE, Hot & Moderate > Cool Aware of reasons for transition (UN2) 22% Tier 1/2 > Tier 3/4 > SUE, NEM > Non-NEM; Top reasons: encourage energy savings, upgrade infrastructure, and reduce environmental impacts 4 Lowering or shifting electricity use will: save money, reduce bill, improve reliability, help environment, manage price increases (UN4) 41% to 51%* 6.26 to 6.89 (mean) Tier 3/4 > Tier 1/2 & SUE 6 Information was useful (UN6) 44%*, 6.67 (mean) 5-2 Aware PG&E provides rebates, ee programs & tips (PA1) 72% Tier 1/2 > Tier 3/4 PG&E recently provided info about rebates, ee programs & tips (PA3) 28% Tier 1/2 > Tier 3/4, CARE > Non-CARE, Non-NEM > NEM Know where to get info about assistance offered by PG&E (PA2) 63% - Took action (AC1) 12% *Percent rating 8-10 Non-CARE > CARE, Cool > Hot & Moderate; Top sources: PG&E website (80%, NON-CARE > CARE, Tier 3/4, SUE > Tier 1/2), called PG&E (15%, CARE > non-care, T1/2/3/4 > SUE) CARE > Non-CARE; Top actions: reduced use, signed up for a program, called PG&E, switched rate plan, went to PGE.com,

172 Key Findings: Awareness of Rate Plan Types C-9 9

173 Tier 3/Tier 4 (n=678) b 10 Awareness of Rate Plan Types C-10 Awareness of rate plan types is relatively high, although 40% of customers still have not heard of a tiered rate. Awareness of TOU at 55% is a good starting point (and up from 44% in the 2013 RROIR survey). Regarding the rate plans they currently have, customer knowledge is relatively low with half (49%) being not sure. Super Users (SUE) have generally higher awareness of types and of their current rate plan. Rate Plans: Heard Of Baseline General Population (n=1,000) Tier 1/Tier 2 (n=501) a SUE (n=222) c Tiered 60% 56% 59% 69% ab Time-of-Use (TOU) 55% 52% 56% 50% Electric Vehicle (EV) 41% 39% 42% 45% a Net Energy Metering (NEM) 38% 34% 39% ac 32% Rate Plans: Have Tiered 39% 34% 39% a 49% ab Time-of-Use (TOU) 11% 9% 11% 10% Electric Vehicle (EV) 2% 2% 2% 2% Net Energy Metering (NEM) 8% 8% 9% 5% Not Sure 49% 53% bc 48% c 41% RA.1: Which of the following types of rate plans for your home electricity use have you heard of? RA.2: And which of these types of rate plans do you currently have for your home?

174 Moderate (n=551) f Tiered 51% 62% a 78% d 59% 63% g 60% g 54% Time-of-Use (TOU) 43% 57% a 77% d 52% 52% 55% 54% Net Energy Metering (NEM) 29% 38% a 82% d 33% 37% 38% 33% Electric Vehicle (EV) 33% 44% a 55% d 40% 35% 46% e 42% e Tiered 35% 40% a 30% 39% c 40% g 41% g 33% Time-of-Use (TOU) 6% 12% a 25% d 9% 9% 10% 12% Net Energy Metering (NEM) 5% 9% a 51% d 5% 9% 8% 7% Electric Vehicle (EV) 1% 2% a 6% d 1% 1% 3% eg 1% Not Sure 57% b 46% 19% 50% c 48% 46% 53% f 11 Awareness of Rate Plan Types C-11 Among subgroups, CARE customers are less aware of rate plan types, and of their own rate plan. Conversely, NEM customers have greater awareness of rate plan types and of the type of rate plan that they currently have, though still just half (51%) of NEM customers said they have NEM. Customers in hot and moderate climate zones have greater awareness of the tiered rate plan, while those in moderate and cool zones have greater awareness of the EV rate plan. Rate Plans: Heard Of CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e Cool (n=356) g Rate Plans: Have RA.1: Which of the following types of rate plans for your home electricity use have you heard of? RA.2: And which of these types of rate plans do you currently have for your home?

175 Tier 3/Tier 4 (n=603) b SUE (n=199) c Mean a 4.85 ab (n=678) b (n=222) c 12 Interest in TOU & Lowering Bill C-12 Those who don t think they have a TOU rate plan were asked their interest in it. 14% are very interested (rating 8-10), and another 30% are somewhat interested, so just as many are very or somewhat interested (44%) as are not interested (46%). Higher users, especially Super Users (SUE), have greater interest in TOU. Higher users are also more interested in actively managing their use to lower their bill, but a slight majority of lower users are active energy managers as well. Interest in Switching to TOU Baseline General Population Do Not Think They Have TOU (n=894) Tier 1/Tier 2 (n=455) a Very Interested (8-10) Somewhat Interested (4-7) Not Interested (1-3) Not Sure 14% 30% 46% 10% 12% 27% 53% bc 7% 13% 32% 45% c 11% a 22% ab 33% 34% 12% a Interest in Lower Electric Bill Baseline General Population (n=1,000) (n=501) a Actively Manage as Many Ways as Possible 53% 51% 52% 59% ab Look to Manage Energy Use but Make Trade Offs 27% 28% 28% 27% Not Concerned 17% 20% c 17% c 12% Not Sure 3% 1% 3% a 2% RA3: [IF DO NOT HAVE TOU} How interested are you in switching to a Time-of-Use or TOU rate plan, using a 10-point scale where 1 means not at all interested, and 10 means very interested? IN1: How would you describe your current level of interest and activity toward lowering your electric bill? Would you say

176 Moderate (n=496) f Very Interested (8-10) 15% 13% 14% 14% 13% 14% 15% Somewhat Interested (4-7) 28% 31% 26% 31% 29% 30% 34% Not Interested (1-3) 47% 46% 47% 46% 49% g 46% 43% Not Sure 9% 10% 14% 9% 9% 11% 9% Mean Manage as Many Ways as Possible 66% b 49% 60% 53% 57% g 54% g 47% Manage Energy Use but Make Trade Offs 21% 30% a 23% 28% 26% 27% 31% Not Concerned 10% 19% a 13% 17% 16% 17% 19% Not Sure 2% 2% 4% 2% 1% 3% e 3% 13 Interest in TOU & Lowering Bill C-13 Interest in TOU is similar across the subgroups, except that hot climate zone customers are somewhat more likely not to be interested (rating 1-3) in TOU. Regarding interest and activity for lowering their electric bill, CARE have greater interest than non-care. Customers in the hot and moderate climate zones have more interest than cool climate zone customers. Interest in Switching to TOU CARE (n=323) a Non-CARE (n=934) b NEM (n=58) c Non-NEM (n=1,152) d Hot (n=448) e Cool (n=313) g Interest in Lower Electric Bill RA3: [IF DO NOT HAVE TOU} How interested are you in switching to a Time-of-Use or TOU rate plan, using a 10-point scale where 1 means not at all interested, and 10 means very interested? IN1: How would you describe your current level of interest and activity toward lowering your electric bill? Would you say

177 Key Findings: Awareness of Rate Reform Changes and Recent Communications C-14 14

178 Tier 3/Tier 4 (n=678) b 15 Awareness of Rate Plan Changes C-15 One in four (27%) of the general population of residential customers said they had heard about upcoming rate plan changes in the past few months with little difference between the usage groups. Heard of Rate Plan Changes Baseline General Population (n=1,000) Tier 1/Tier 2 (n=501) a SUE (n=222) c Yes 27% 29% 26% 27% No 70% 66% 72% a 70% Not Sure 4% 5% b 3% 3% AW1: Have you heard in the past few months about any upcoming changes to PG&E s rate plans for your home electricity use? This could include changes to the types of rate plans that are offered or the way that rate plans are structured?

179 Moderate (n=551) f Yes 26% 27% 53% d 26% 30% f 23% 28% f No 69% 69% 44% 70% c 66% 73% e 68% Not Sure 4% 3% 3% 4% 4% 3% 3% 16 Awareness of Rate Plan Changes C-16 NEM are more likely than non-nem to have heard about upcoming rate plan changes by about two to one (53% vs. 26%). Those in the hot and cool climate zones are also more likely to have heard about changes than those in moderate zones. Heard of Rate Plan Changes CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e Cool (n=356) g AW1: Have you heard in the past few months about any upcoming changes to PG&E s rate plans for your home electricity use? This could include changes to the types of rate plans that are offered or the way that rate plans are structured?

180 17 Awareness of Specific Changes C-17 Just over half of the general population is familiar with the tiered plan (52%), and baseline (55%) with higher awareness among higher electricity users. Not surprisingly, very few said they are aware of the reduction from 4 to 2 tiers (13%), or of the price difference reduction between tiers (12%). For these changes, there are no differences between the electricity usage groups. Statements: Aware Of Electricity is currently billed using a 4-tiered rate plan, where customers use allotted electricity for each tier before they move up to the next, higher priced tier during the monthly bill period Each customer is given a monthly baseline quantity of electricity usage that is charged at the lowest price level or tier Baseline General Population (n=1,000) 52% 55% Tier 1/Tier 2 (n=501) a Tier 3/Tier 4 (n=678) b SUE (n=222) c 48% 53% a 59% a 56% 55% 57% In the future, the number of tiers in the 4- tiered rate plan will be reduced to two 13% 12% 12% 14% In the future, the difference in electricity price between tiers will be reduced 12% 12% 10% 10% AW2: Which of the following statements about PG&E rate plans are you aware of?

181 18 Awareness of Specific Changes C-18 Regarding changes to the tiered rates, CARE customers have somewhat lower knowledge of the baseline aspect, but greater awareness of the changes to reduce the number of tiers and reduce the price difference between tiers compared to non-care customers. NEM customers also have greater awareness of how tiered plans work, and of the future reduction in the number of tiers. Hot and moderate climate zone customers are more knowledgeable about tiered plans and forthcoming changes in the number of tiers than those cool zones. Statements: Aware Of Electricity is currently billed using a 4-tiered rate plan, where customers use allotted electricity for each tier before they move up to the next, higher priced tier during the monthly bill period Each customer is given a monthly baseline quantity of electricity usage that is charged at the lowest price level or tier CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e Moderate (n=551) f Cool (n=356) g 50% 53% 75% d 51% 55% g 55% g 44% 51% 57% a 78% d 55% 55% 57% 54% In the future, the number of tiers in the 4- tiered rate plan will be reduced to two 15% b 11% 23% d 12% 15% fg 11% g 10% In the future, the difference in electricity price between tiers will be reduced 17% b 9% 12% 11% 13% 10% 10% AW2: Which of the following statements about PG&E rate plans are you aware of?

182 19 Awareness of Specific Changes C-19 Awareness of having a choice of rate plans (38%), of the availability of a rate plan comparison (28%), and of new TOU plans that will be made available (22%) is modest, and reflective that some customers are aware of changes to come. Awareness that most residential customers will transition to a TOU rate plan (10%) is considerably lower. Since this has not yet been communicated, the 10% level likely represents the minimum false positive level. Super Users (SUE) are less aware that they have a choice of rate plans than the other segments. Statements: Aware Of A choice of rate plans is available so you can decide which rate plan best suits your needs Baseline General Population (n=1,000) 38% Tier 1/Tier 2 (n=501) a Tier 3/Tier 4 (n=678) b SUE (n=222) c 37% 39% c 32% A personalized rate plan comparison is available to help you choose the rate plan best for you 28% 30% 27% 27% New Time-of-Use or T-O-U rate plans will be made available to all PG&E customers 22% 24% 21% 21% By 2019, most residential customers will be transitioned onto a Time-of-Use or T-O-U rate plan 10% 12% 9% 10% AW2: Which of the following statements about PG&E rate plans are you aware of?

183 Moderate (n=551) f Cool (n=356) g 20 Awareness of Specific Changes C-20 Regarding statements about TOU rate plans, CARE are more aware of the upcoming changes that new TOU plans will be made available and that most residential customers will transition to TOU by NEM customers have greater awareness than non-nem that there is a choice of rate plans available, and that a personalized rate plan comparison is available. Hot and moderate climate zone customers have greater awareness that a choice of rate plans is available. Statements: Aware Of CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e A choice of rate plans is available so you can decide which rate plan best suits your needs 36% 37% 55% d 35% 39% g 38% g 32% A personalized rate plan comparison is available to help you choose the rate plan best for you 28% 28% 38% d 28% 28% 29% 27% New Time-of-Use or T-O-U rate plans will be made available to all PG&E customers 26% b 21% 29% 22% 23% 24% 21% By 2019, most residential customers will be transitioned onto a Time-of-Use or T-O-U rate plan 13% b 9% 14% 10% 11% 10% 9% AW2: Which of the following statements about PG&E rate plans are you aware of?

184 21 Awareness of Specific Changes C-21 Awareness is relatively high of rate plans that can help you save money (50%), and somewhat lower for rate plans that can help to manage price increases (34%). Awareness of a surcharge for high usage at 34% suggests that some customers might interpret the existing higher tiers as a surcharge. One in four (24%) are aware of the alerts that notify if you are exceeding a pre-set bill amount. Statements: Aware Of Rate plans are available that could help you save money Baseline General Population (n=1,000) 50% Tier 1/Tier 2 (n=501) a Tier 3/Tier 4 (n=678) b SUE (n=222) c 53% 50% 49% METRIC 1 Rate plans are available that may help you better manage any price increases 34% 34% 34% 29% To encourage energy conservation, a surcharge will be applied to a customers bill whenever their electricity use is excessively high 34% 33% 33% 36% Customers can sign up for Alerts which notify you when you are about to exceed a pre-set bill amount of your choice to avoid the surprise of a high bill 24% 22% 23% 24% AW2: Which of the following statements about PG&E rate plans are you aware of?

185 Moderate (n=551) f Cool (n=356) g 22 Awareness of Specific Changes C-22 Regarding statements related to managing one s electricity use, there is little difference in awareness between CARE and non-care, NEM and non-nem, and by climate zones. Statements: Aware Of CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e Rate plans are available that could help you save money 53% 50% 57% 50% 52% 51% 49% METRIC 1 Rate plans are available that may help you better manage any price increases 33% 33% 32% 33% 32% 34% 34% To encourage energy conservation, a surcharge will be applied to a customers bill whenever their electricity use is excessively high 35% 33% 35% 33% 32% 34% 33% Customers can sign up for Alerts which notify you when you are about to exceed a pre-set bill amount of your choice to avoid the surprise of a high bill 24% 23% 18% 23% 23% 24% 21% AW2: Which of the following statements about PG&E rate plans are you aware of?

186 C-23 Sources of Awareness Top sources of unaided awareness about rate plan changes include news (mentioned by 7% of the population), bill inserts (4%), a separate letter from PG&E (4%), from PG&E (2%), word-of-mouth (2%), a phone call from PG&E (2%), and a contractor or retail store (2%). Four key sources were also asked about on an aided basis. Bill inserts have the highest recall at 26% followed by a separate letter at 22%, and and a postcard at 15% each. Sources (Unaided and Aided) Baseline General Population (n=1,000) Tier 1/Tier 2 (n=501) a AW3: [IF AW1=YES] You mentioned you heard about changes to rate plans for home electricity use. From what sources do you recall hearing or learning about rate plan changes? AW4: PG&E can communicate rate plan changes in different ways. Do you recall receiving information about upcoming rate plan changes in the past three months through? Tier 3/Tier 4 (n=678) b SUE (n=222) c Inserts in bill* 4% 26% 28% 24% 28% Separate letter from PG&E* 4% 22% 23% 21% 19% from PG&E* 2% 15% 15% c 15% c 9% Postcard from PG&E* 1% 15% 14% 14% 11% News (TV, radio, paper, online) 7% 8% 8% 8% Word-of-mouth 2% 2% 1% 4% b Telephone call from PG&E 2% 1% 2% 1% Contractor or retail store 2% 1% 1% 5% ab Information on PG&E s website 1% 2% 1% 1% In-person from PG&E local office 1% 1% 1% <1% TV Ad 1% 1% 1% 1% Radio Ad 1% 2% 1% 1% All others 2% 2% 2% 3% Don t recall or not sure 3% 3% 2% 2% Unaided Aided 23

187 Moderate (n=551) f Inserts in bill* 32% b 24% 18% 27% c 27% 25% 27% Separate letter from PG&E* 24% 21% 30% d 21% 24% 21% 20% from PG&E* 11% 15% a 17% 14% 12% 15% 16% Postcard from PG&E* 15% 13% 16% 14% 13% 15% 13% News (TV, radio, paper, online) 7% 8% 16% d 7% 8% 6% 9% Word-of-mouth 2% 2% 3% 2% 3% f 1% 2% Contractor or retail store 1% 2% a 5% 2% 2% 2% 1% Telephone call from PG&E 1% 2% 1% 1% 2% 1% 1% Information on PG&E s website 1% 1% 3% 1% 1% 1% 1% Radio Ad - 1% a 4% 1% 1% 1% 2% f In-person from PG&E local office 1% 1% - 1% c 1% 1% 1% TV Ad 1% 1% 1% 1% 1% f <1% 1% All others 1% 2% 5% 2% 2% 2% 1% Don t recall or not sure 1% 3% a 3% 3% 2% 2% 3% 24 Sources of Awareness C-24 Sources of awareness show that CARE customers rely more on bill inserts and less on , while NEM are more likely to have heard about changes via a separate letter from PG&E or from the news than non-nem. Sources are similar across climate zones. Sources (Unaided and Aided) CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e Cool (n=356) g AW3: [IF AW1=YES] You mentioned you heard about changes to rate plans for home electricity use. From what sources do you recall hearing or learning about rate plan changes? AW4: PG&E can communicate rate plan changes in different ways. Do you recall receiving information about upcoming rate plan changes in the past three months through?

188 25 Sources of Awareness: Continued C-25 Less frequently recalled information sources are shown below each mentioned by less than 1%. Baseline Sources (Unaided and Aided) General Population Tier 1/Tier 2 Tier 3/Tier 4 (n=1,000) (n=501) a (n=678) b SUE (n=222) c Local Community Organization < 1% <1% 1% 1% Social Media < 1% - <1% a <1% In-Person from PG&E at Event < 1% <1% <1% <1% Energy Upgrade California < 1% <1% <1% <1% CPUC < 1% - <1% - Telephone Call to PG&E < 1% <1% <1% - Other Source < 1% 1% b - <1% AW3: [IF AW1=YES] You mentioned you heard about changes to rate plans for home electricity use. From what sources do you recall hearing or learning about rate plan changes? AW4: PG&E can communicate rate plan changes in different ways. Do you recall receiving information about upcoming rate plan changes in the past three months through?

189 26 Key Messages Received C-26 About one in ten residential customers said they recalled receiving one of the forthcoming key messages (ranging from 12% to 9%). These levels represent false positives since PG&E has not yet communicated these messages with customers. Results are similar between the three usage segments for all three messages. Key Messages Baseline General Population (n=1,000) Tier 1/Tier 2 (n=501) a Tier 3/Tier 4 (n=678) b SUE (n=222) c A notice that new Time-of-Use rate plans will be available A notice that the number of tiers in a tiered rate plan are being reduced, and the difference in electricity price between tiers are being reduced A personalized rate plan comparison, showing you how much your electric bill would be on different rate plans 12% 10% 9% 12% 11% 10% 10% 9% 7% 10% 9% 10% AW4B-D: [IF AW3 OR AW4= , SEPARATE LETTER, INSERTS IN BILLING STATEMENT, OR POSTCARD] Which of the following, if any, do you recall receiving from PG&E?

190 Moderate (n=551) f 27 Key Messages Received C-27 CARE customers are more likely to recall a notice that new TOU rate plans will be available and that the number of tiers are being reduced than non-care. Non-NEM are more likely to recall a message about a personalized rate plan comparison being available, although NEM are more likely to have been aware of a rate plan comparison tool. Key Messages CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e Cool (n=356) g A notice that new Time-of-Use rate plans will be available A notice that the number of tiers in a tiered rate plan are being reduced, and the difference in electricity price between tiers are being reduced A personalized rate plan comparison, showing you how much your electric bill would be on different rate plans 15% b 10% 14% 11% 9% 9% 11% 12% b 8% 10% 9% 9% 9% 9% 12% 9% 5% 10% c 12% 10% 12% AW4B-D: [IF AW3 OR AW4= , SEPARATE LETTER, INSERTS IN BILLING STATEMENT, OR POSTCARD] Which of the following, if any, do you recall receiving from PG&E?

191 (n=144) (n=43) (n=102) (n=20) (n=98) (n=24) 28 Evaluation of Communications C-28 Customer evaluations of the communications show high scores for being easy to understand (rating 8-10), with somewhat lower scores for being useful and caused you to take action. received slightly high ratings than the other three methods. Tier 3/4 customers gave higher ratings than the other segments for , separate mail, and postcards, while Tier 1/2 gave higher ratings for bill inserts. Inserts in Bill (%8-10) Baseline Gen Pop Received Communication (n=257) Tier 1/Tier 2 (n=138) a Tier 3/Tier 4 (n=164) b Useful 36% 42% c 35% c 19% Easy to Understand 44% 51% c 42% 31% Caused you to take action 20% 22% 21% 15% SUE (n=62) c Separate Letter from PG&E (%8-10) (n=221) (n=117) Useful 36% 35% c 40% c 14% Easy to Understand 43% 44% 42% 30% Caused you to take action 19% 20% 19% 12% from PG&E (%8-10) (n=148) (n=77) Useful 39% 27% 44% a 30% Easy to Understand 51% 42% 57% ac 30% Caused you to take action 24% 16% 28% ac 10% Postcard from PG&E (%8-10) (n=148) (n=68) Useful 34% 31% 33% 21% Easy to Understand 45% 38% 47% 33% Caused you to take action 21% 25% 16% 21% AW5: How would you rate your level of agreement with the following statements using a 10-point scale where 1 means you completely disagree and 10 means you completely agree, and you can use any number between 1 and 10?

192 Useful 37% 33% 35% 33% 31% 38% 34% Easy to Understand 48% 39% 48% 40% 38% 42% 45% Caused you to take action 30% b 14% 17% 19% 17% 20% 18% Useful 44% b 25% 17% 30% 30% 35% 22% Easy to Understand 52% b 38% 75% d 39% 32% 55% eg 33% Caused you to take action 29% 17% 17% 20% 22% 23% g 11% 29 Evaluation of Communications C-29 CARE customers had more positive evaluations for all the types of communications measured in the survey than non-care. Among the climate zone segments, customers in moderate climate zones are more favorable toward the communications than customers in other zones, but these differences are significant only for bill inserts and postcards. Inserts in Bill (%8-10) CARE (n=110) a Non-CARE (n=254) b NEM (n=14) c Non-NEM (n=339) d Hot (n=130) e Moderate (n=139) f Cool (n=95) g Useful 41% 32% 29% 34% 32% 42% g 28% Easy to Understand 46% 43% 26% 43% 36% 50% e 45% Caused you to take action 31% b 15% 29% 19% 22% 22% 15% Separate Letter from PG&E (%8-10) (n=81) (n=223) (n=23) (n=267) (n=119) (n=114) (n=71) from PG&E (%8-10) (n=37) (n=162) (n=13) (n=173) (n=61) (n=80) (n=58) Useful 51% b 33% 38% 35% 36% 40% 31% Easy to Understand 68% b 44% 46% 47% 46% 55% 41% Caused you to take action 35% b 19% 8% 22% c 21% 21% 22% Postcard from PG&E (%8-10) (n=52) (n=138) (n=12) (n=174) (n=63) (n=82) (n=45) AW5: How would you rate your level of agreement with the following statements using a 10-point scale where 1 means you completely disagree and 10 means you completely agree, and you can use any number between 1 and 10?

193 Key Findings: Understanding Rate Reform and TOU Transition Changes C-30 30

194 Understanding of TOU Bill Impacts 31 C-31 Statements of understanding are rated highest for how you can better manage bill increases by adjusting your energy usage and lowest for how your bill is or would be impacted by a Time-of-Use rate plan, but the range of means between the five statements (6.30 to 5.17) is relatively narrow. Understanding is significantly lower for SUE customers than the other two usage segments for all statements except how you can save money by shifting electricity use to other lower-priced times of day on a Time-of-Use rate plan. Statements Baseline General Population (n=1,000) Tier 1/Tier 2 (n=501) a Rating (8-10) Tier 3/Tier 4 (n=678) b SUE (n=222) c How you can better manage bill increases by adjusting your energy use How you can save money by shifting electricity use to other lower-priced times of day on a Time-of Use rate plan METRIC 3 How to manage your electric bill using the rate plan that you are currently on How changes to current rate plans mean you could be paying more unless you can adjust your electricity use METRIC 3 43% 33% 22% 37% 30% 30% 36% 34% 28% 34% 33% 30% 2% 3% 2% 2% 43% c 43% c 36% Mean: % 36% 32% Mean: % c 35% 30% Mean: % c 34% c 27% Mean: How your bill is or would be impacted by a Time-of-Use rate plan 29% 33% 35% UN1: How well would you say you understand each of the following, for example how this might affect you? Use a scale of 1 to 10, where one means you do not understand at all and 10 means you understand very well, and you can use any number from 1 to 10? 2% 28% c 29% c 20% Mean: c 5.14 c 4.72 (8-10) (4-7) (1-3) Not Sure

195 Understanding of TOU Bill Impacts Moderate (n=551) f Cool (n=356) g 32 C-32 Non-CARE customers have greater understanding than CARE regarding how to manage bill increases by adjusting energy use, and how to save money by shifting use to other times of day with a TOU rate plan. NEM have greater knowledge than non-nem about how to save money by shifting with a TOU rate plan, and how to manage your electric bill using the rate plan you are on. Across the climate zones, those in cool zones are less knowledgeable about how changes could mean they could pay more and how their bill would be impacted by TOU. Statements CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e How you can better manage bill increases by adjusting your energy use Mean: a % 43% 49% 41% 40% 45% 40% How you can save money by shifting electricity use to other lower-priced times of day on a Time-of Use rate plan Mean: a 6.36 d METRIC 3 How to manage your electric bill using the rate plan that you are currently on Mean: d How changes to current rate plans mean you could be paying more unless you can adjust your electricity use METRIC 3 Mean: g 5.20 How your bill is or would be impacted by a Time-of-Use rate plan Mean: g % 37% a 47% d 35% 35% 38% 34% 38% 34% 45% d 35% 36% 34% 35% 33% 32% 31% 32% 34% g 35% g 28% 26% 28% 35% 27% 27% g 30% g 23% UN1: How well would you say you understand each of the following, for example how this might affect you? Use a scale of 1 to 10, where one means you do not understand at all and 10 means you understand very well, and you can use any number from 1 to 10?

196 Awareness of Reasons for the Transition 33 C-33 Almost one in four (22%) residential customers is aware of reasons for the transition. Those with higher electricity usage are less likely to be aware of any reasons. Top reasons that customers identified are: (1) encourage energy savings, (2) upgrade the infrastructure to support other sources of energy such as solar, and (3) reduce negative impacts on the environment. Aware of Reasons for Transition Baseline General Population (n=1,000) Tier 1/Tier 2 (n=501) a Tier 3/Tier 4 (n=678) b SUE (n=222) c Yes 22% 27% bc 22% c 16% No 76% 71% 76% a 83% ab Not Sure 2% 2% 3% c 1% Reasons Aware of Reasons (n=147) (n=36) (n=134) (n=216) Encourage energy savings 78% 81% 69% 81% 76% 75% 70% 70% 69% 69% 68% 62% 61% 61% Upgrade the infrastructure to support other sources of energy such as solar 73% 77% c 58% Reduce neg. impacts on the environm. to meet CA s GHG reductn. goals 69% 78% a 64% Make it easier to see how energy use impacts your monthly energy costs 59% 74% a 67% Increase revenue for PG&E 69% 69% 72% Make rate plans simpler to understand 63% 70% 58% Help customers save money or reduce their electric bills 58% 69% a 64% Improve reliability by reducing the possibility of frequent outages 70% 67% 56% Make it more fair and equitable for all customers 60% 63% 53% More closely align electricity prices with the true costs of service 51% 62% a 56% Directed by the California Public Utility Commission or CPUC 62% 61% 69% UN2: Are you aware of the reasons why PG&E is making changes to the way they charge their residential customers for electricity use? UN3: [IF UN2=YES] Which of the following reasons are you aware of for the upcoming changes to rate plans for home electricity use?

197 Awareness of Reasons for the Transition Encourage energy savings 89% b 75% 74% 78% 78% 80% 77% Upgrade the infrastructure to support other sources of energy such as solar 78% 72% 74% 73% 69% 74% 77% Reduce neg. impacts on the environm. to meet CA s GHG reductn. goals 81% b 70% 74% 72% 70% 74% 22% Make it easier to see how energy use impacts your monthly energy costs 81% b 63% 59% 68% 69% 66% 65% Increase revenue for PG&E 67% 70% 78% 68% 69% 68% 72% Make rate plans simpler to understand 79% b 62% 63% 66% 68% 61% 70% Help customers save money or reduce their electric bills 82% b 58% 41% 66% c 62% 65% 64% Improve reliability by reducing the possibility of frequent outages 78% b 64% 52% 69% c 68% 60% 76% f Make it more fair and equitable for all customers 76% b 56% 37% 63% c 60% 58% 64% More closely align electricity prices with the true costs of service 64% 55% 67% 55% 59% 56% 56% Directed by the California Public Utility Commission or CPUC 74% b 59% 63% 61% 59% 65% 63% Cool (n=356) g 34 C-34 CARE and non-care are similar in their awareness of reasons for the rate plan changes, but among those aware, CARE have greater knowledge of more of the various reasons. NEM have greater awareness of the reasons than non-nem. Aware of Reasons for Transition CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e Moderate (n=551) f Reasons Yes 21% 23% 35% d 22% 22% 23% 24% No 77% 75% 60% 76% c 77% 74% 74% Not Sure 2% 2% 5% 2% 1% 3% eg 1% UN2: Are you aware of the reasons why PG&E is making changes to the way they charge their residential customers for electricity use? UN3: [IF UN2=YES] Which of the following reasons are you aware of for the upcoming changes to rate plans for home electricity use?

198 Understanding Impacts of Electricity Use Tier 3/Tier 4 (n=678) b SUE (n=222) c 35 C-35 Agreement is relatively high for statements representing the impact of lowering or shifting electricity use, ranging from 51% (rating 8-10) for allow you to save money to 41% for help keep any price increase manageable. Mean scores are all above 6.0 as well. The Tier 3/Tier 4 segment has significantly higher agreement than the other two segments that lowering or shifting use will improve reliability of the electric grid to reduce the possibility of frequent outages. Lowering your electricity use or shifting the time you use it will (%8-10) Baseline General Population (n=1,000) Tier 1/Tier 2 (n=501) a METRIC 4 Allow you to save money 51% 29% 17% 2% 48% 51% 50% Mean: Reduce your electricity bill Reduce negative impacts on the environment Improve reliability of the electric grid to reduce the possibility of frequent outages Help keep any price increase manageable 50% 29% 45% 32% 19% 43% 33% 41% 35% 18% 20% 21% 3% 4% 4% 3% 46% 52% a 47% Mean: % 46% 40% Mean: % 42% 40% Mean: ac % 41% 38% Mean: (8-10) (4-7) (1-3) Not Sure UN4: For each of the following statements, how would you rate your agreement, using a scale from 1 to 10, where 1 means you do not agree at all and 10 means you agree completely? Lowering your electricity use or shifting the time you use it will

199 Understanding Impacts of Electricity Use Moderate (n=551) f Cool (n=356) g 36 C-36 Regarding their understanding of the impacts of lowering electricity use or shifting the time they use it, there are few differences among the various subgroups here, except that customers in cool climate zones have generally higher agreement while those in hot zones have lower agreement. Hot zone customers also have significantly lower agreement that these actions reduce negative impacts on the environment. Lowering your electricity use or shifting the time you use it will (%8-10) CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e METRIC 4 Allow you to save money 51% 49% 52% 49% 48% 50% 52% Mean: Reduce your electricity bill 48% 49% 51% 49% 47% 49% 51% Mean: Reduce negative impacts on the environment Mean: e 6.85 e Improve reliability of the electric grid to reduce the possibility of frequent outages 43% 41% 36% 42% 40% 42% 44% Mean: Help keep any price increase manageable 46% 43% 44% 44% 40% 46% e 48% e 42% 39% 39% 40% 39% 38% 42% Mean: UN4: For each of the following statements, how would you rate your agreement, using a scale from 1 to 10, where 1 means you do not agree at all and 10 means you agree completely? Lowering your electricity use or shifting the time you use it will

200 Received Information on Bill Impacts Tier 3/Tier 4 (n=678) b SUE (n=222) c Mean C-37 One out of four (23%) of the residential general population said that PG&E has provided them with information explaining how the upcoming rate changes will impact their bill. The SUE segment is less likely to have received this information than the other two segments. Almost half (44%) said this information explaining their bill impacts is very useful (rating 8-10), while conversely just 15% said it is not useful (rating 1-3). Received Bill Impact Information Baseline General Population (n=1,000) Tier 1/Tier 2 (n=501) a Yes 23% 25% c 23% c 18% No 65% 60% 65% a 71% ab Not Sure 12% 15% 12% 11% METRIC 6 Usefulness of the Information Received Information on Bill Impacts (n=227) (n=126) (n=159) (n=40) Very Useful (8-10) 44% 37% 43% 32% Somewhat Useful (4-7) 38% 40% 40% 48% Not Useful (1-3) 15% 19% 14% 18% Not Sure 3% 4% 3% 2% UN5: Has PG&E provided you with information explaining how upcoming rate changes will impact your monthly bill? UN6: [IF YES TO UN5] How would you rate the usefulness of the information explaining the impact to your monthly bill from PG&E using a scale of 1 to 10, where one mean not at all useful and 10 means very useful?

201 Received Information on Bill Impacts Moderate (n=551) f Cool (n=356) g Yes 24% 23% 22% 23% 22% 23% 25% No 67% 64% 64% 64% 66% g 66% g 59% Not Sure 9% 14% a 14% 12% 12% 11% 15% f 38 C-38 CARE and NEM subgroups have similar recall regarding PG&E having provided them with information explaining how upcoming rate changes will impact their monthly bill. Those in hot and moderate climate zones are more likely to say they did not receive this information compared to those in cool zones. For rating this information s usefulness, those in the hot zones gave directionally higher ratings than those in moderate or cool zones. Received Bill Impact Information CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e Usefulness of the Information (n=83) (n=242) (n=17) (n=296) (n=109) (n=126) (n=90) METRIC 6 Very Useful (8-10) 47% 37% 41% 39% 44% 37% 38% Somewhat Useful (4-7) 37% 42% 29% 41% 44% 37% 41% Not Useful (1-3) 14% 17% 24% 17% 10% 21% e 18% Not Sure 1% 4% a 6% 3% 2% 5% 3% Mean UN5: Has PG&E provided you with information explaining how upcoming rate changes will impact your monthly bill? UN6: [IF YES TO UN5] How would you rate the usefulness of the information explaining the impact to your monthly bill from PG&E using a scale of 1 to 10, where one mean not at all useful and 10 means very useful?

202 Key Findings: Knowledge About PG&E Assistance C-39 39

203 Tier 3/Tier 4 (n=678) b SUE (n=222) c 40 Awareness of PG&E Assistance C-40 Almost three out of four (72%) are aware that PG&E provides rebates, energy savings, and tips to help customers save energy and money on their bill, with the Tier 1/Tier 2 segment having higher awareness than Tier 3/Tier 4. Far fewer (28%) said that PG&E recently provided them with this information. Tier 1/Tier 2 are more likely to have received this information recently than the Tier 3/Tier 4 or the SUE segments. Aware PG&E Provides Assistance Baseline General Population (n=1,000) Tier 1/Tier 2 (n=501) a METRIC 5 PG&E Recently Provided Yes 72% 76% b 72% 74% No 26% 23% 27% 25% Not Sure 2% 1% 2% c <1% Yes 28% 34% b 27% 28% No 56% 50% 58% a 56% Not Sure 15% 16% 15% 15% PA1: Are you aware that PG&E provides rebates, energy savings programs, and tips to help you save energy and money on your bill? PA3: Did PG&E recently provide you with information about its rebates, energy savings programs, and tips to help you save energy and money?

204 Moderate (n=551) f Cool (n=356) g Yes 36% b 28% 22% 30% c 30% 29% 31% No 54% 55% 57% 54% 56% 56% 51% Not Sure 10% 17% a 21% 15% 14% 15% 18% 41 Awareness of PG&E Assistance C-41 All subgroups have similar awareness that PG&E provides rebates, energy savings programs, and tips to help customers save energy and money. However, there are differences regarding if customers recently received information about this assistance. CARE are more likely than non-care, and non-nem are more likely than NEM to have received information recently. Aware PG&E Provides Assistance CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e METRIC 5 Yes 71% 74% 73% 74% 72% 75% 73% No 28% 24% 22% 25% 27% 23% 26% Not Sure 1% 1% 5% 1% 1% 2% 1% PG&E Recently Provided PA1: Are you aware that PG&E provides rebates, energy savings programs, and tips to help you save energy and money on your bill? PA3: Did PG&E recently provide you with information about its rebates, energy savings programs, and tips to help you save energy and money?

205 Knowledge of Where to Go for Assistance Tier 3/Tier 4 (n=678) b SUE (n=222) c 42 C-42 Two out of three (63%) said they know where to go for information about rebates, energy savings programs, and tips offered by PG&E. PG&E s website, mentioned by 80% of the general population, is overwhelmingly the top source for this type of information. Another 15% said they would call PG&E. Higher electricity users are more likely to mention the website, while lower users are more likely to say they would call. Know Where to Get Assistance Baseline General Population (n=1,000) Tier 1/Tier 2 (n=501) a METRIC 2 Yes 63% 64% 63% 61% No 36% 35% 36% 39% Sources of Assistance from PG&E Not Sure 1% 1% c 1% c - Know Where to Get Assistance (n=630) PG&E s Website 80% 75% 81% a 87% a Called PG&E 15% 16% c 16% c 10% CPUC 3% 4% 3% 1% PG&E Office 3% 3% 3% 7% b Energy Upgrade CA Website 1% <1% 1% 2% (n=322) (n=429) (n=136) Other 8% 10% b 6% 8% Not Sure 1% 1% <1% - PA2: Do you know where to go to get information about rebates, energy savings programs, and tips offered by PG&E? PA2B: [IF PA2=YES] Where would you go for this information?

206 Knowledge of Where to Go for Assistance No 40% 35% 31% 36% 38% g 37% 32% Not Sure 1% 1% 1% 1% <1% 1% 1% PG&E s Website 64% 84% a 81% 79% 75% 83% e 80% Called PG&E 22% b 13% 19% 15% 16% 14% 15% CPUC 7% b 2% 4% 3% 4% f 1% 5% f PG&E Office 6% b 3% - 4% c 5% g 3% 2% Energy Upgrade CA Website 1% 1% 2% 1% 1% <1% 2% f Other 12% b 6% 6% 8% 11% fg 6% 7% C-43 A majority from all subgroups know where to get information about rebates, energy savings programs, and tips, but non-care are more likely to know than CARE, and cool climate zone customers are more likely to know than those in hot or moderate zones. Regarding where customers would go to get information, CARE are more likely to call, go the CPUC, or go to a PG&E office, while non-care are more likely to use the website. Moderate climate zone customers are more likely to go to PG&E s website for information, while those in hot zones are more likely to go to a PG&E office. Hot and moderate zones are also more likely to go to the CPUC. Know Where to Get Assistance CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e Moderate (n=551) f Cool (n=356) g METRIC 2 Yes 59% 65% a 68% 63% 61% 62% 67% e Sources of Assistance from PG&E (n=203) (n=684) (n=52) (n=799) (n=303) (n=344) (n=240) Not Sure - 1% a - <1% c <1% 1% <1% PA2: Do you know where to go to get information about rebates, energy savings programs, and tips offered by PG&E? PA2B: [IF PA2=YES] Where would you go for this information? 43

207 Key Findings: Actions Taken as a Result of Rate Reform Changes C-44 44

208 Actions Taken as a Result of Rate Reform 45 C-45 Almost one in eight (12%) said they took action as a result of becoming aware of or receiving information about upcoming rate plan changes. Top changes included: took steps to reduce use (mentioned by 5% of the population), signed up for a program (2%), called PG&E for more info (2%), switched rate plans (2%), and went to PG&E s website (2%). Took Action as a Result Actions Taken Baseline General Population (n=1,000) Tier 1/Tier 2 (n=501) a Yes 12% 12% 10% 12% No 40% 42% 40% 36% Not Sure 1% 1% 1% 1% Not Aware 48% 45% 9% 50% Took steps to reduce electricity use 5% 7% b 4% 5% Signed up for a PG&E program 2% 1% 3% a 3% Called PG&E for more info 2% 2% 2% 2% Switched rate plans 2% 2% 2% 2% Went to PG&E s website 2% 1% 2% c <1% Shifted electricity use to a lower price time of day 1% 2% 1% <1% Personalized rate plan comparison online < 1% <1% 1% c - Personalized rate plan comparison in-person < 1% <1% <1% <1% Personalized rate plan comparison by phone < 1% <1% <1% c - Other < 1% <1% <1% 1% Not Sure < 1% <1% 1% <1% AC1: After you became aware of/received communications about upcoming changes to PG&E s rate plans for home electricity use, did you take any action? AC2: [IF AC1=YES] What actions did you take in recent months? Tier 3/Tier 4 (n=678) b SUE (n=222) c

209 Actions Taken as a Result of Rate Reform Yes 16% b 10% 17% 11% 11% 11% 13% No 36% 41% 51% d 40% 41% 39% 40% Not Sure 1% 1% - 1% c <1% 1% 3% ef Took steps to reduce electricity use 7% b 5% 3% 5% 5% 5% 6% Signed up for a PG&E program 4% b 1% 4% 2% 2% 2% 2% Called PG&E for more info 3% b 1% 5% 2% 2% 1% 3% Switched rate plans 2% 2% 6% d 1% 1% 2% 3% Went to PG&E s website 1% 2% 6% d 1% 1% 1% 2% Shifted electricity use to a lower price time of day 1% 1% - 1% c 1% 1% 1% Personalized rate plan comparison online 1% <1% - <1% c 1% <1% 1% Personalized rate plan comparison in-person 1% <1% - <1% c - 1% e <1% Personalized rate plan comparison by phone 1% <1% 1% <1% <1% <1% 1% Other 1% <1% 1% <1% 1% <1% 1% Not Sure <1% <1% - <1% c <1% <1% 1% 46 C-46 CARE are more likely than non-care and NEM are more likely than non-nem to have taken action as a result of becoming aware or receiving communications about upcoming rate plan changes. CARE were also more likely to take steps to reduce, to sign up for a program, or to call PG&E. Took Action as a Result CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e Moderate (n=551) f Cool (n=356) g Actions Taken Not Aware 46% 48% 32% 48% c 47% 50% 45% AC1: After you became aware of/received communications about upcoming changes to PG&E s rate plans for home electricity use, did you take any action? AC2: [IF AC1=YES] What actions did you take in recent months?

210 Tier 3/Tier 4 (n=678) b 47 Actions Taken in General C-47 The table below shows the actions taken by customers NOT as a result of upcoming rate changes. A main finding is that customers already have a relatively high level of activity, especially taking steps to reduce their electricity use and going to PG&E s website. The upcoming changes, though, do appear to have prompted a higher frequency of rate plan switching than otherwise occurs, given that nearly as many (2%) switched rate plans as a result of changes as did for other reasons (3%). Tier 3/Tier 4 and SUE customers are more likely that Tier 1/Tier 2 to have taken many of these actions. Actions Taken Baseline General Population (n=1,000) Tier 1/Tier 2 (n=501) a SUE (n=222) c Took steps to reduce electricity use 47% 41% 49% a 49% a Signed up for a PG&E program 11% 9% 11% 18% ab Called PG&E for more info 17% 14% 19% a 21% a Switched rate plans 3% 2% 3% 4% Went to PG&E s website 32% 22% 35% a 32% a Shifted electricity use to a lower price time of day 13% 10% 14% a 16% a Personalized rate plan comparison 8% 6% 9% a 8% Other 1% 1% 1% 2% Not Sure 22% 30% bc 20% 20% AC3: [IF NOT AWARE OF RATE REFORM OR NO ACTIONS TAKEN BECAUSE OF RATE REFORM] Have you done any of the following in recent months?

211 48 Actions Taken in General C-48 CARE, non-nem, and customers in the hot climate zones are more likely to have signed up for a PG&E program. Non-CARE and moderate climate zone customers are more likely to have gone to PG&E s website than CARE or the other climate areas. Customers in the hot and moderate zones are more likely than those in cool areas to have called PG&E for more information, and hot zone customers are more likely to have shifted electricity use to a lower price time of day. Actions Taken CARE Non-CARE NEM Non-NEM Hot (n=343) a (n=1,058) b (n=1,270) d (n=494) e Cool (n=356) g Took steps to reduce electricity use 43% 47% 40% 47% 52% 49% 47% Signed up for a PG&E program 25% b 8% 5% 12% c 19% fg 10% 12% Called PG&E for more info 19% 17% 17% 16% 23% g 20% g 14% Switched rate plans 3% 3% 5% 3% 3% 5% 4% Went to PG&E s website 23% 32% a 35% 29% 31% 38% eg 30% Shifted electricity use to a lower price time of day 13% 13% 18% 13% 19% fg 14% 13% Personalized rate plan comparison 8% 7% 5% 7% 10% 11% 9% Other 1% 1% 3% 1% 2% 1% 1% Not Sure 21% 25% 21% 24% 23% 25% 33% ef (n=77) c Moderate (n=551) f AC3: [IF NOT AWARE OF RATE REFORM OR NO ACTIONS TAKEN BECAUSE OF RATE REFORM] Have you done any of the following in recent months?

212 Tier 3/Tier 4 (n=678) b 49 Programs Signed Up For C-49 Programs that customers said they signed up for recently include: CARE (9% of the general population), ESA (2%), Balanced Payment Plan (1), Payment Assistance (1%), and My Energy (1%). SUE customers are more likely than the other segments to have signed up for CARE. Program(s) Signed Up For Baseline General Population (n=1,000) Tier 1/Tier 2 (n=501) a SUE (n=222) c CARE 9% 7% 8% 14% ab ESA 2% 1% 2% 1% Balanced Payment Plan (BPP) 1% <1% 1% a 1% Payment Assistance 1% <1% 1% 1% My Energy / My Account 1% <1% 1% 1% SmartRate < 1% - 1% a <1% Energy / Bill Alerts < 1% <1% <1% <1% Appliance Rebate < 1% <1% <1% <1% SmartAC - <1% - - Other 1% 1% 1% 3% Not Sure 2% 2% 3% 2% AC4: [IF SIGNED UP FROM PROGRAM] What program or programs did you sign up or apply for?

213 Moderate (n=551) f CARE 24% c 3% - 9% c 13% fg 6% 6% ESA 3% c 1% 4% 1% 2% f 1% 2% Balanced Payment Plan (BPP) 1% 1% - 1% c 2% fg <1% <1% Payment Assistance 1% c <1% - 1% c 1% <1% <1% My Energy / My Account 1% <1% - 1% c 1% g <1% - SmartRate 1% <1% - <1% c <1% 1% g - Energy / Bill Alerts 1% <1% 1% <1% <1% 1% 1% Appliance Rebate <1% <1% - <1% c 1% f - <1% SmartAC - <1% - <1% <1% - - Other 2% 1% 1% 1% 1% 1% 2% Not Sure 3% 2% 3% 2% 2% 3% 3% 50 Programs Signed Up For C-50 Not surprisingly, CARE customers are more likely to have signed up for CARE and ESA than non-care customers. Non-NEM are more likely to have signed up for most of these programs than NEM. Customers in the hot zones are also more likely to have signed up for CARE, BPP, My Energy, and appliance rebates than customers in other areas. Program(s) Signed Up For CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e Cool (n=356) g AC4: [IF SIGNED UP FROM PROGRAM] What program or programs did you sign up or apply for?

214 Key Findings: Overall Evaluation of PG&E C-51 51

215 Tier 3/Tier 4 (n=678) b 52 Overall Evaluation of PG&E C-52 30% have high agreement (rating 8-10) that PG&E helps customers make smart energy choices and save money. Slightly more (34%) have high favorability toward PG&E. Tier 1/Tier 2 are the most favorable with highest agreement, followed by Tier 3/Tier 4 customers. SUE customers gave the lowest ratings. Smart Energy Choices Baseline General Population (n=1,000) Tier 1/Tier 2 (n=501) a SUE (n=222) c High Agreement (8-10) 30% 33% c 29% c 19% Moderate Agreement (4-7) 46% 46% 46% 50% Low Agreement (1-3) 22% 18% 23% a 29% ab Not Sure 3% 3% 3% 2% Mean bc 5.72 c 5.12 Favorability High Favorability (8-10) 34% 42% bc 34% c 21% Moderate Favorability (4-7) 49% 45% 49% 55% a Low Favorability (1-3) 16% 12% 16% 23% ab Not Sure 1% 1% 1% 1% Mean bc 6.25 c 5.43 OE1: Using the 1 to 10 agreement scale, how would you rate your agreement with the statement PG&E helps customers make smart energy choices and save money. OE2: One last question about PG&E. Using a 10-point scale where 1 means your feelings are not at all favorable and 10 means your feelings are extremely favorable, how would you rate your favorability towards PG&E?

216 High Agreement (8-10) 38% b 26% 16% 30% c 27% 31% 28% Moderate Agreement (4-7) 44% 47% 52% 45% 47% 43% 51% f Low Agreement (1-3) 16% 24% a 31% d 22% 24% g 23% g 18% Not Sure 3% 3% 1% 3% 3% 3% 3% Mean 6.34 b c High Favorability (8-10) 43% b 32% 26% 35% c 34% 37% 33% Moderate Favorability (4-7) 46% 49% 48% 49% 47% 47% 53% ef Low Favorability (1-3) 10% 17% a 25% d 15% 19% g 15% 13% Not Sure 1% 1% 1% 1% 1% 1% 1% Mean 6.80 b c e Overall Evaluation of PG&E C-53 CARE customers gave PG&E higher ratings than non-care for helping customers make smart energy choices and save money and for their overall favorability of PG&E. Similarly, non-nem gave higher ratings to PG&E than NEM. For the climate zone segments, means scores are lower in the hot zones for PG&E helping them make smart energy choices, and higher in moderate zones for overall favorability. Smart Energy Choices CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e Moderate (n=551) f Cool (n=356) g Favorability OE1: Using the 1 to 10 agreement scale, how would you rate your agreement with the statement PG&E helps customers make smart energy choices and save money. OE2: One last question about PG&E. Using a 10-point scale where 1 means your feelings are not at all favorable and 10 means your feelings are extremely favorable, how would you rate your favorability towards PG&E?

217 54 C-54 Key Findings: Demographics

218 Own or Rent & Number Living in Home Mean a 3.45 ab 55 C-55 Two out of three (66%) are owners and 32% are renters. Owners tend to be higher electricity users than renters. The mean household size is 2.65 persons, with larger households being much more likely to have higher electricity use. Own or Rent Baseline General Population (n=1,000) Tier 1/Tier 2 (n=501) a Tier 3/Tier 4 (n=678) b SUE (n=222) c Own 66% 59% 68% a 69% a Rent or lease 32% 38% bc 29% 28% Something Else < 1% <1% <1% <1% Not Sure or Prefer not to answer 2% 2% 2% 2% Nr. People in Household One 21% 39% bc 17% c 9% Two 36% 33% c 38% c 26% Three 16% 12% 17% a 19% a Four 16% 8% 16% a 21% a Five or more 9% 4% 9% a 22% ab Prefer not to answer 3% 3% 3% 3% H1: Do you own or rent your home? D1: Including you, how many people live in your household?

219 Own or Rent & Number Living in Home Cool (n=356) g Own 48% 71% a 96% d 64% 68% g 66% g 60% Lease 50% b 27% 3% 33% c 30% 30% 39% ef Something Else 1% <1% - <1% c <1% - <1% Not Sure or Prefer not to answer 2% 2% 1% 2% 2% g 4% eg <1% One 33% b 20% 6% 25% 22% 21% 28% ef Two 26% 34% a 38% 33% 34% 33% 37% Three 13% 17% 16% 16% 15% 17% 16% Four 14% 14% 26% d 14% 15% 15% 12% Five or more 11% 9% 13% 9% 12% g 9% 7% Prefer not to answer 3% 3% 1% 3% 3% g 4% 1% Mean d g 2.64 g C-56 CARE customers are less likely to be owners, and are more likely to be in single-person households than non-care. NEM are more likely owners in larger households than non- NEM. The cool climate zones have fewer owners and smaller household sizes. Own or Rent CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e Moderate (n=551) f Nr. People in Household H1: Do you own or rent your home? D1: Including you, how many people live in your household?

220 Age of Decision Maker & Senior in HH 57 C-57 Household decision maker ages are distributed normally with a peak in the year old category. One in three (33%) of households has a senior (65 or older) living there. Tier 1/Tier 2 is more likely to include seniors, while Tier 3/Tier 4 has a higher proportion of year olds and the SUE segment has more year olds.. Age Baseline General Population (n=1,000) Tier 1/Tier 2 (n=501) a Tier 3/Tier 4 (n=678) b SUE (n=222) c 18 to 24 years 25 to 34 years 35 to 44 years 45 to 54 years 55 to 64 years 65 to 74 years 4% 15% 13% 15% 20% 16% 3% 12% 10% 15% 20% 17% 5% c 16% ac 14% a 14% 20% 15% 1% 9% 17% a 20% b 23% 17% 75 or older 10% 16% bc 9% 6% Prefer not to answer 7% 7% 6% 6% Seniors (65+) in Household Yes (NET) 33% 38% bc 31% 29% Yes Self 26% 33% bc 24% 23% Yes Someone else 7% 6% 7% 6% No 63% 57% 65% a 67% a Prefer not to answer 4% 4% 3% 4% D2: What is your age? D2a: [IF D2 NOT 65 OR OLDER] Is anyone else in your household 65 or older?

221 Age of Decision Maker & Senior in HH C-58 CARE customers are equally distributed across age groups, except for somewhat fewer who are year olds. CARE are also no more likely to have a senior in the household than non-care. NEM customers tend to be older (45-74 years old) compared to non- NEM, and they are directionally more likely to have a senior in the household. The cool zones have fewer seniors than either hot or moderate zones as well. Age CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e Moderate (n=551) f Cool (n=356) g Seniors (65+) in Household 18 to 24 years 4% 3% - 4% c 4% 3% 5% f 25 to 34 years 15% 13% 3% 13% c 13% 14% 14% 35 to 44 years 10% 14% a 16% 13% 12% 15% eg 11% 45 to 54 years 15% 16% 21% 16% 15% 15% 17% 55 to 64 years 21% 20% 26% 21% 23% f 18% 21% 65 to 74 years 17% 16% 25% d 16% 17% 15% 16% 75 or older 12% 11% 6% 12% c 12% 11% 9% Prefer not to answer 6% 7% 4% 7% 5% 8% e 6% Yes 36% 33% 40% 34% 37% g 33% 29% Self 29% 26% 31% 27% 29% 26% 25% Others 7% 6% 9% 6% 8% g 7% g 3% No 61% 63% 56% 62% 59% 61% 68% ef Not Sure 3% 4% 3% 4% 4% 5% g 2% D2: What is your age? D2a: [IF D2 NOT 65 OR OLDER] Is anyone else in your household 65 or older? 58

222 Education & Employment C-59 Over half the general population customers have an undergraduate degree (34%) or masters or doctorate degree (23%), with a slight tendency for those with undergraduate degrees to be higher users. A majority are employed full-time (41%) or are retired (28%), with retired being more likely in Tier 1/Tier 2. Education Baseline General Population (n=1,000) Tier 1/Tier 2 (n=501) a Tier 3/Tier 4 (n=678) b SUE (n=222) c High School or Less 22% 23% 21% 23% Trade or Technical School 16% 15% 16% 15% Undergraduate Degree 34% 31% 35% 36% Masters or Doctorate Degree 23% 25% 23% 21% Prefer not to answer 5% 5% 5% 5% Employment Status Employed Full Time 41% 37% 44% ac 37% Employed Part Time 7% 7% 6% 6% Self - Employed 8% 5% 7% 15% ab Unemployed 5% 5% 5% 5% Homemaker or Caregiver 3% 1% 3% a 5% a Student 1% 1% c 2% c - Retired 28% 35% bc 26% 24% Semi Retired 1% <1% 1% 1% Prefer not to answer 6% 7% 5% 7% D3: What is the last year of school you completed? D6: What is your current employment status? 59

223 Moderate (n=551) f High School or Less 37% b 17% 9% 23% c 33% fg 17% 15% Trade or Technical School 17% 15% 18% 15% 18% 15% 14% Undergraduate Degree 29% 36% a 42% 33% 31% 32% 41% ef Masters or Doctorate Degree 12% 27% a 29% 23% 14% 29% e 28% e Prefer not to answer 6% 5% 3% 5% 5% g 7% g 3% Employed Full Time 24% 46% a 39% 40% 36% 44% e 42% e Employed Part Time 10% b 6% 8% 7% 6% 7% 8% Self - Employed 9% 7% 10% 8% 10% 7% 7% Unemployed 10% b 4% 3% 5% 5% 4% 7% f Homemaker or Caregiver 3% 2% 4% 3% 3% g 3% 2% Student 1% 1% - 1% c 1% 1% 1% Retired 32% 28% 35% 29% 32% 28% 27% Semi Retired 1% 1% - 1% c 1% 1% 1% Prefer not to answer 9% b 6% 1% 7% c 6% 7% 5% Education & Employment C-60 CARE customers have lower education levels and are less likely to be full-time employed, while they are more likely to be employed part-time or to be unemployed. NEM customers have higher education levels than non-nem. The hot climate zones have the lowest education levels. The hot zones also have fewer with full-time employment and more who are retired. Education CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e Cool (n=356) g Employment Status D3: What is the last year of school you completed? D6: What is your current employment status? 60

224 61 Ethnicity & Preferred Language C-61 Most of the general population is White (not Hispanic) (61%), with representation of Hispanic (10%), Asian (8%), and African-American (5%). Asian customers are less likely to be in the SUE segment, but otherwise ethnicity is not related to electricity use. Most prefer English communications, consistent with the survey having been conducted in English. Ethnicity Baseline General Population (n=1,000) Tier 1/Tier 2 (n=501) a Tier 3/Tier 4 (n=678) b SUE (n=222) c White (not Hispanic) 61% 64% 61% 66% Hispanic or Latin America 10% 8% 10% 9% Asian or Pacific Islander 8% 9% c 8% c 4% African - American 5% 5% 5% 5% Mixed 4% 3% 4% 3% Native American 1% <1% 1% a <1% Other 1% <1% <1% <1% Prefer not to answer 11% 10% 11% 12% Preferred Language English 96% 96% 97% 95% Spanish 2% 2% 2% 2% Asian (NET) 1% 1% c 1% c - Chinese - Mandarin 1% 1% c 1% c - Chinese - Cantonese < 1% - <1% - Japanese < 1% <1% - - Vietnamese < 1% - <1% - Other < 1% 1% 1% <1% Prefer not to answer 2% 2% 2% 4% D4: What do you consider your ethnicity to be? D5: In what languages do you prefer to receive communications?

225 Moderate (n=551) f White (not Hispanic) 55% 65% a 70% 63% 64% 62% 63% Hispanic or Latin America 16% b 7% 8% 9% 13% fg 8% g 5% Asian or Pacific Islander 4% 9% a 6% 7% 2% 12% e 9% e African - American 9% b 3% 4% 5% 4% 3% 9% ef Mixed 4% 3% 1% 3% 3% 3% 5% Native American 1% 1% 1% 1% 1% 1% 1% Other - <1% a - <1% c - 1% eg - Prefer not to answer 10% 11% 9% 11% 13% g 11% g 8% English 95% 97% 97% 96% 96% 95% 97% Spanish 3% 2% 1% 2% 2% 2% 1% Asian (NET) 1% 1% - 1% c - 1% e 1% e Chinese - Mandarin <1% 1% - <1% c - 1% e 1% Chinese - Cantonese <1% - - <1% - <1% - Japanese - <1% - <1% - <1% - Vietnamese <1% - - <1% - - <1% Other 1% 1% - 1% c <1% 1% 2% e Prefer not to answer 3% 3% 1% 3% 3% g 3% g 1% 62 Ethnicity & Preferred Language C-62 CARE customers are more likely Hispanic or African-American than non-care. The cool zones have more Asian and African-American customers, the moderate zones have more Asian and Hispanic customers, and the hot zones have more Hispanic customers. Ethnicity CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e Cool (n=356) g Preferred Language D4: What do you consider your ethnicity to be? D5: In what languages do you prefer to receive communications?

226 Disability of HH Member C-63 One in five (19%) of the residential general population have someone with a disability living in the home. These households are more likely to be in the SUE segment. By disability type, those with chronic disease are more likely to have lower electricity use, while those with cognitive or psychological disabilities are more likely to have higher electricity use. Anyone Disabled in Household Baseline General Population (n=1,000) Tier 1/Tier 2 (n=501) a Tier 3/Tier 4 (n=678) b SUE (n=222) c Type of Disability Yes 19% 21% 17% 29% ab No 76% 75% c 79% c 67% Prefer not to answer 5% 4% 4% 4% Someone with disability in HH (n=189) Mobility 40% 35% 40% 45% Chronic disease Hearing Cognitive (learning or mental) Psychological Vision Other - 19% 15% 9% 8% 5% 33% bc 13% 5% 5% 5% - 19% 16% 9% 9% 6% - 12% 11% 11% 14% a 3% - Prefer not to answer 4% 5% 3% 3% (n=103) (n=116) (n=64) Want communications 3% 4% c 3% c - in large type or braille D7a: Do you or does anyone in your household have a permanent disability, related to mobility, hearing, vision, cognitive, psychological, or chronic disease? D7b: [IF D7a=YES] In which category would you classify the disability? D7c: [IF D7b=VISUAL] In which category would you classify the disability? 63

227 Moderate (n=551) f Yes 39% b 14% 16% 21% 27% fg 15% 18% No 58% 81% a 82% 75% 68% 79% e 79% e Prefer not to answer 3% 5% 3% 4% 4% 5% g 3% Mobility 38% 41% 50% 39% 36% 41% 44% Chronic disease 28% b 18% 17% 23% 24% 20% 24% Hearing 7% 19% a 8% 14% 13% 16% 10% Cognitive (learning or mental) 8% 7% 8% 7% 10% g 8% 3% Psychological 12% b 5% - 9% c 10% 6% 10% Vision 5% 5% 17% 5% 5% 5% 5% Other Prefer not to answer 3% 4% - 4% c 3% 4% 5% 64 Disability of HH Member C-64 CARE customers are almost three times as likely as non-care to have someone with a disability in the household. Regarding the type of disability, CARE are more likely to have a chronic disease disability, while non-care are more likely to have hearing disabilities. Hot climate zone customers also have a higher proportion of disabilities. Anyone Disabled in Household CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e Cool (n=356) g Type of Disability (n=133) (n=150) (n=12) (n=265) (n=135) (n=85) (n=63) Want communications 4% 1% - 3% c 1% 2% 5% in large type or braille D7a: Do you or does anyone in your household have a permanent disability, related to mobility, hearing, vision, cognitive, psychological, or chronic disease? D7b: [IF D7a=YES] In which category would you classify the disability? D7c: [IF D7b=VISUAL] In which category would you classify the disability?

228 Tier 3/Tier 4 (n=678) b 65 Household Income & Gender C-65 Almost half of the general population (40%) did not give their income. Among those that did, 11% have income of less than $25,000 and 21% have income in the $100,000 or more range. Tier 1/Tier 2 customers are more likely to be in the lowest income group, while Tier 3/Tier 4 and SUE are more likely to have income of $100,000 or more. 52% of respondents are female and 48% are male. Household Income Baseline General Population (n=1,000) Tier 1/Tier 2 (n=501) a SUE (n=222) c Less than $25,000 11% 16% bc 10% 9% $25,000 to < $50,000 14% 15% 13% 15% $50,000 to < $100,000 14% 14% 14% 17% $100,000 or more 21% 18% 24% a 25% a Prefer not to answer or not sure 40% 37% 39% 35% Gender Female 52% 52% 52% 54% Male 48% 48% 48% 46% D8: What is you annual household income before taxes? D9: GENDER BY OBSERVATION

229 Moderate (n=551) f Less than $25,000 34% b 5% 3% 13% c 18% fg 8% 10% $25,000 to < $50,000 24% b 11% 12% 15% 18% fg 11% 13% $50,000 to < $100,000 6% 17% a 14% 14% 14% 15% 13% $100,000 or more 1% 28% a 40% d 20% 16% 26% e 24% e Prefer not to answer or not sure 34% 39% 31% 38% 34% 40% e 39% Female 65% b 48% 48% 53% 61% fg 46% 51% Male 35% 52% a 52% 47% 39% 54% e 49% e 66 Household Income & Gender C-66 As expected, CARE customers have much lower income than non-care, and NEM have higher income than non-nem. CARE are also more likely to be female. Customers in hot climate zones also have lower income and are more likely to be female than those in moderate or cool climate zones. Household Income CARE (n=343) a Non-CARE (n=1,058) b NEM (n=77) c Non-NEM (n=1,270) d Hot (n=494) e Cool (n=356) g Gender D8: What is you annual household income before taxes? D9: GENDER BY OBSERVATION

230 67 C-67 Questions? HINER & Partners, Inc. Steve Westberg (562) ext 40

231 PACIFIC GAS AND ELECTRIC COMPANY APPENDIX D WEB TOOL IMAGES

232 Appendix D - Web Tool Images 1. Home Energy Check-up 2. Usage and Cost Presentment Page 1 of 7 D-1

233 3. Bill Forecasts 4. Energy Alerts Page 2 of 7 D-2

234 5. Bill Comparison SmartRate 6. Appliance Costs Page 3 of 7 D-3

235 7. Next Best Action 8. Tips and Saving Guides Page 4 of 7 D-4

236 9. Rate Comparison and What-If Page 5 of 7 D-5

237 10. On-Line Rate Enrollment Page 6 of 7 D-6