Direct Access Working Group

Consumer Education Plan

Discussion Draft for September 26, 1996 Meeting

NOTE: Comments on this document are to be sent to Carl Silsbee by October 4, 1996.

I. Summary

• Two stage process for educational efforts, covering "start-up" in 1997, and an ongoing sustainable program for future years
• Stage I is primarily managed by the utilities, with oversight from other stakeholders
  • Utilities are responsible for developing and implementing a consumer education plan (CEP) through a consensus-based process.
  • The CEP will rely heavily on a third-party advertising g/media firm jointly selected by the three utilities (possible participation by municipal systems) to craft and deliver a consistent statewide "message" consistent with the different markets that exist.
  • The CEP will include utility efforts, such as bill inserts, customer solicitations, and so forth, as appropriate.
  • The CEP will establish broad goals and specific, measurable objectives for consumer education, targeted primarily toward smaller consumers
• Stage II needs to be a coordinated program between the CPUC, the utilities, and the consumer education trust fund
  • Design should take place in 1997, based on initial results of the Stage I program
  • What do we say to establish a foundation for creating the consumer education trust fund in 1997, pursuant to the CPUC Restructuring Decision?
  • Permanent funding mechanisms (subject to review and sunset provisions) and an assessment of ongoing "maintenance level" activities are needed
• Utilities will proceed with preparing education plan filings on 12/6/96 (???), setting forth the scope of services that would be procured from a third-party advertising/media firm, and requesting interim funding. If the CPUC prefers a different approach or timeline, we request that the Assigned Commissioner issue a ruling as soon as possible providing further guidance.
• We intend to request that the CPUC make the following specific approvals/findings in response to the 12/6/96 filings:
  • Approve the general approach of a primary utility role in developing a CEP
  • Provide specific guidance for developing an RFP to select an outside advertising/media firm

Prepared by Carl Silsbee, Edison

Discussion Draft, 9/25/96

• Approve the utility interim funding request
• Select of a CPUC "referee" to provide guidance to the utilities in areas where it is not possible to reach agreement through the consensus-based process

II. The Need For Flexibility

• Lack of certainty regarding "upstream" design elements (e.g., the phase-in schedule) is an ongoing problem endemic to the restructuring effort. CPUC approvals must be broad in direction, and provide flexibility to tailor the CEP to "dovetail" with other aspects of direct access implementation.
• Uncertain issues that may substantially affect the design of the CEP
  • Rapidity and selection criteria for direct access choice
  • Consumer and retailer level of interest in direct access
• Need to assess areas where education interfaces with consumer protection (e.g., verification and slamming)
  

III. Elements of the CEP

• Timeline of activities in conjunction with various direct access phase-in schedules
• Initial measurement of customer wants and expectations, and existing perceptions of structure and restructuring issues
• Staging of the message(s) to consumers (the five themes developed at the 8/28 DAWG subgroup meeting)
• Degree of saturation/market penetration necessary for each of the five themes
• Multi-media, multi-cultural, and multi-lingual needs
• Recommendations regarding delivery mechanisms
  • Role of the outside firm
  • Utility bill inserts and educational pamphlets
• Quantifiable mechanisms to assess program success at conveying the message to consumers

IV Role of the Outside Advertising/Media Firm

• Rely on the selected firm to assist in developing the CEP
• Rely on the selected firm to help craft and deliver the message
• Use the RFP and resulting scope of services to allow the consensus-based process to more effectively oversee the process. That is, explicitly set parameter of the work, and overall goals and objectives in the RFP
• Guidelines governing RFP development (need to develop a list)
  

Prepared by Carl Silsbee, Edison

Discussion Draft, 9/25/96

V The Consensus-Based Process

• Stakeholder involvement in reviewing/advising utility development of the RFP and CEP.
• Checkpoint review of specific consumer materials (e.g., bill inserts), outside firm selection, key recommendations of the outside firm, and so on.
• Who should participate in the process?
• Is the process informal or formal?
• Role and selection of the CPUC referee
• Options for selection (senior CACD staff, Commissioner, outside expert)
• Method for interaction with the referee (degrees of informal v. formal process)

VI. Funding

• Utilities will file a funding request to recover incremental costs in rates, subject to the following principles:
  • No increase in rates during the AB 1890 rate freeze period (prior to December 31, 2001).
  • No utility risk that CEP expenses will put recovery of transition costs in jeopardy
• No reasonableness review of expended funds, as a result of the consensus-based process and the involvement of the CPUC referee. (Good faith reliance on the opinions of the CPUC referee should be per se reasonable.)
• "Rough" magnitude (and possible variance) of funding needs is ....

VII. Recommendation

• The short time until educational efforts must commence requires prompt action. Due to the general agreement reached in the working group on educational issues, parties are prepared to move forward with 12/6/96 utility filings without further guidance.
• The DAWG requests the Assigned Commissioner issue a ruling affirming our recommended course of action, providing a formal comment period to take comments from any parties that oppose our proposed actions, and providing any further guidance as appropriate.
  
  
  

Prepared by Carl Silsbee, Edison

Discussion Draft, 9/25/96