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W A T E R E N E R C Y I RIVERSIDE PUBLIC UTILITIES WI& Board Memorandum P U B L I C U T I L I T I E S BOARD OF PUBLIC UTILITIES DATE: AUGUST 14, 2017 ITEM NO: 6 SUBJECT: ENERGY EFFICIENCY AND DEMAND REDUCTION TEN-YEAR TARGET AS REQUIRED BY ASSEMBLY BILL 2021 AND ASSEMBLY 2227 ISSUE: Recommend that the City Council approve the updated Energy Efficiency and Demand Reduction 10 -year target. RECOMMENDATION: That the Board of Public Utilities recommend that the City Council approve the Riverside Public Utilities updated Energy Efficiency and Demand Reduction 10 -year target of 1% of annual projected retail energy sales for the period beginning 2018 through 2027. LEGISLATIVE BACKGROUND: Assembly Bill (AB) 1890 (Brulte, 1996) requires that 2.85% of electric revenue be utilized to fund public benefits programming and must be used in at least one of four areas: demand side management (energy efficiency), renewable energy, low-income assistance, or research, development, and demonstration. Senate Bill (SB) 1037 (Kehoe, 2005), a comprehensive package that sets ambitious energy conservation policies and goals. SB 1037 requires publicly owned utilities (POU's) when procuring energy to serve their customer load, to "first acquire all available energy efficiency (EE) and demand reduction (DR) resources that are cost effective, reliable, and feasible" and to report kilowatt hour (kWh) savings to the California Energy Commission annually. This Senate bill also requires POU's to report results annually to its customers and the Energy Commission on its energy efficiency and demand reduction programs. AB 2021 (Levine, 2006) requires POU's to identify, target and achieve all potentially cost effective electric savings and establish 10 -year energy efficiency targets. Riverside Public Utilities (RPU) has set an ambitious 10 -year energy efficiency target of 1 % of annual retail energy sales. Assembly Bill 2227 (Bradford, 2012) changed the frequency of the 10 -year energy efficiency potential studies from once every three years to once every four years to be consistent with the State's Integrated Energy Planning process. SB 350 (De Leon, 2015), establishes annual targets for statewide energy efficiency savings and demand reduction that will achieve a cumulative doubling of statewide energy efficiency savings in electricity and natural gas by January 1, 2030. The bill requires local POU's to establish annual targets for energy efficiency savings and demand reduction consistent with this goal.