2017 Residential Electric Rate Summit

December 4th, 2017

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Agenda1. 2017 Rate Changes Bill Impacts

2. High Usage Charge Implementation

3. Text Alert Trials

4. Energy Management Tools to Low Income & Disadvantaged Communities

5. Status of Rate Design Window

Appendixa) Voluntary TOU Enrollments

b) Start/Transfer Service Pilots

c) Opt-In Pilot Text Alert Campaign

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Non-CARE & CARE Customer Bill ImpactsJune 2016 and June 2017 Tiered Rates

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SCE filed Advice 3696-E with 1/1/18 glidepath rate changes on Nov. 16th. RAR increased 2.7% mostly related to sales decreases.

Non-CARE

Usage Level # of Customers

Avg. Monthly Usage (kWh)

% of Non-CARE Customers

2016 Average Monthly Bill

2017 Average Monthly Bill $ Change % Change

Up to Baseline (BL) 914,222 250 30.9% $41.73 $43.24 $1.51 3.6%

101% to 400% of BL 1,953,894 653 66.0% $132.06 $133.83 $1.77 1.3%

> 400% of BL 94,436 2,023 3.2% $525.98 $521.71 -$4.28 (0.8%)

CARE

Usage Level # of Customers

Avg. Monthly Usage (kWh)

% of CARE Customers

2016 Average Monthly Bill

2017 Average Monthly Bill $ Change % Change

Up to Baseline (BL) 453,835 272 36.8% $29.27 $31.32 $2.04 7.0%

101% to 400% of BL 775,407 604 62.9% $79.49 $81.15 $1.66 2.1%

> 400% of BL 3,407 1,861 0.3% $346.01 $316.58 -$29.43 (8.5%)

High Usage Customer (HUC) Responses to Letters• SCE sent letters to HUC customers who were reaching 350%-400% of

baseline usage (Pre-Breach) and those customer who reached 400+% of baseline (Breach)‒ From Jan ‘17 to Oct ‘17 SCE sent 482k Pre-Breach letters and 435k Breach letters

• Key Findings:‒ The letters encouraged customers to take action to enroll in programs‒ Breach letters received a higher response than pre-breach letters‒ Despite customers taking action to enroll in programs, we did not find any

conservation in load

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%’s are based on number who received letters and made enrollment or rate changes - numbers exclude organic enrollment (only incremental is shown)

0.3%0.2%

0.9%

0.5% 0.4%

2.4%

0

2,000

4,000

6,000

8,000

10,000

12,000

Budget Assistant Medical Baseline TOU Rate Change

# of

Enr

ollm

ents

/Rat

e Ch

ange

s Customers Responses to HUC Letters

Pre-Breach Breach

ME&O Campaign – Text Alert Trials

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Background

• 2016 TOU research conducted by Bovitz and bill redesign efforts found that customers were interested in receiving alerts/reminders to help them adjust to TOU rates.

• A text alert trial was developed to determine if real world TOU customers would be interested in and utilize this type of service

Customer Experience• > 90% of customers recall receiving the alerts.

• 85% believe the alerts were somewhat or very helpful.

• 70% claim they did something different or changed the way they used electricity in response to the alerts.

• Customers who received the text alert at 2 pm (before the peak hours) performed better than both 8 pm (after the hour) and control groups, both regarding overall load reduction and peak hour usage shifts.

Implementation for Default Pilot

• SCE will offer Default TOU Pilot participants the opportunity to opt-in to receive text message alerts.

• A website link (able to enroll via phone as well) will be included in the Welcome Kit.

• Participants will be able to choose when they would like to receive the text alerts with the exception that texts are only offered on weekdays.

Phase Date Solicitation Method* Enrolled Customers Take Rates** Opt-Out Rates Text Alert Timing

1 April 2017 Direct Mail 452 13% 17% (77) ½ received the alert at 2pm ½ received the alert at 8pm

2 June/July 2017 TOU Bill Comparison Mailers 436 29% 11% (47) ~¼ received the alert at 2pm~¾ received the alert at 8pm

* For both phases customers were directed to enroll by Business Reply Card (BRC) only** Phase 1 direct mail targeted 3,434 customers resulting in 452 enrollments** Phase 2 TOU bill comparison mailers were sent to 52,468 customers; 1,497 made a rate change to TOU and 436 of those enrolled in text alerts

ME&O CampaignEnergy Management Tools to Low Income Communities with DAC Zip Codes

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• Conducted 7-week Energy Management Tools campaign into low income ($75K and under) communities within disadvantaged communities (DAC) zip codes, including Desert/San Jacinto, Orange, Metro LA, San Joaquin.

• Objectives ‒ Test the viability of digital banner ads and social media as a way to deliver an energy management message in this

segment‒ Determine the appetite for the message and creative to this segment

• Results‒ Delivered over 13 million impressions, with a click-through rate of 0.43%, suggesting appetite for this type of messaging ‒ Highest click-throughs came from the Metro and Orange regions; lowest click-throughs observed in San Joaquin. ‒ In all regions except San Joaquin, a tablet had highest click-throughs followed by mobile

Example Facebook Post

Example Tablet DisplayExample Desktop Display

Status of Rate Design Window

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Appendix

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Voluntary TOU Enrollments

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TOU Rate Option# of Customers % Change

(Q1 ’16 – Q3 ’17)Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017TOU-D Option-A 6,247 6,798 7,087 7,334 9,046 9,643 10,579 69.3% TOU-D Option-B 8,657 9,672 10,306 10,914 16,957 18,630 20,312 134.6% TOU-D-T 15,696 14,909 14,675 14,586 14,520 14,206 14,391 (8.3%)TOU-EV-1 785 789 782 771 749 810 843 7.4% Totals 31,385 32,168 32,850 33,605 41,272 43,289 46,125 47.0%

31,385 32,168 32,850 33,605

41,27243,289

46,125

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

0

5,000

10,000

15,000

20,000

25,000

Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017

Total # of Customers on all TO

U Rates

# of

Cus

tom

ers o

n In

divi

dual

TO

U R

ates

TOU-D Option-A TOU-D Option-B TOU-D-T TOU-EV-1 Totals

TOU-D-B rate enrollments took the lead in 2017, primarily driven by HUC letters

Start/Transfer Service Pilot Background

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Pilot Timing: Oct 4th - ongoing

Overall Pilot Objective: Assess customer and operational impacts of mentioning rate options on the call.

Pilot Target Volumes: Aiming for 4k Billing Inquiry (QAB) calls and 2.5k turn-on/transfer (TUON) calls, handled by two teams of SCE Energy Advisors with enhanced scripting. As of Nov 24th, there have been 1,013 QAB and 1,973 turn-on calls taken

Scripting: For TUON calls one group of Energy Advisors will have a brief script that spurs customers to go online to view the rate options, and a second group will probe and ask if they would like to discuss their rate options.

“SCE offers a variety of rate plans. Our TOU rate plans may benefit

you if you are able to reduce your energy use during the weekday afternoons and evenings. Visit

SCE.com/rates to learn more about the TOU rate plans.”

TURN-ON/TRANSFERS“Your account will be placed on the

Domestic tiered rate; however, SCE does offer a variety of Time of Use rate plans.

Our TOU rate plans may benefit you if you are able to reduce your energy use during

the weekday afternoons and evenings. Please visit SCE.com/rates to learn more

about different rate options. “Are you okay with the defaulted rate or would you like to

hear more about other options?”

Option 2

“There may be other rate options that you could benefit from. Do

you have a few minutes to discuss those options or would you prefer

to visit our website for more information?”

BILLING INQUIRIES

Energy Advisors Observations: Energy Advisors Observations

Energy Advisors feel customers are sometimes overwhelmed with the information/conversation during the turn-on process and advised they will look online later on the rate options

Some of the calls coming through TUON through IVR may not be eligible for the TOU rate conversation (i.e. clean & show, new business/development, new meter spots)

Customers who are interested or would like to know more ask the Energy Advisors for recommendations for the best rate option

Billing Inquiry calls are more willing to listen to TOU conversations

Some customers are not aware of when they are using electricity the most

Some customers think they are already on a time-of-use rate

Option 1

Start/Transfer Service Pilot Interim Survey Results

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Survey Objectives: Determine if inbound-calling residential customers who are selected and who receive proactive suggestions

regarding TOU rates will demonstrate higher levels of awareness of, familiarity with, and interest in TOU options. Concurrently, we also seek to evaluate the comments of customers toward the suggestions.

Survey Approach: Surveys conducted via telephone Two test cells : QAB and TUON callers who were exposed to the TOU script Two control cells for QAB and TUON callers 100 interviews in each of the four cells have been completed*

Interim Survey Findings: Engagement with customers calling for QAB or TUON significantly enhances awareness that customers have a choice

of rates, awareness that TOU is one of those choices, and familiarity with how a TOU rate works. Many say they don’t recall the conversation, the differences in these metrics suggest the conversations are,

nonetheless, effective. Billing customers in the test cell are much more impacted relative to their control cell than are Turn On customers

relative to their control cell. This is likely because customers calling about a high bill are more receptive to the information, but it could also be due to differences in the CSR groups.

Customers who do recall the conversation, for the most part, found the conversation worthwhile, containing new information that was easy to understand and not overly burdensome, in terms of the amount of time spent on the topic by the representative.

Pilot Next Steps: Continue Pilot Operations to hit desired call volume targets Continue to conduct post-surveys for QAB and TUON Continue to request observations from Energy Advisors Measure Average Handle Time for calls – plan to conduct a time study to review extra call time– expect to complete

in Q1 2018

* It is our understanding, however, that some of the interviews completed as either test or control TUON may not qualify and may need to be removed from these findings.

ME&O CampaignCARE Mailer Updates

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• Updated CARE direct mail in Q4 to include larger fonts, bolding and color contrasting of key statements to allow for easier readability among seniors and the visually impaired. ‒ We will continue to modify the letter in 2018 based on feedback and consultation

with stakeholders. BEFORE AFTER

Text Alert Messaging Trial Load Impact Study

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Results in Comparison to Control Group 2 PM Text Alerts 8 PM Text Alerts

Average Peak Hour Usage Shift 0.04 kWh (0.03) kWh*

Average Conservation Effect 0.11 kWh 0.07 kWh

Customers who received the text alert at 2 pm (before the peak hours) performed better than both 8 pm (after the hour) and control groups, both regarding overall load reduction

and peak hour usage shifts.

* Indicates customers used more during the peak hours than the non-peak hours compared to comparison group

Study Background• SCE estimated the peak hour usage shifts and overall conservation effects of Text Alert by Alert Time

(2 pm vs. 8 pm) for TOU Program Participants of Phase 1.

• Treatment Group – Participants who accepted to receive the text alerts

• Comparison/Control Group – Those who didn’t accept to receive the text alerts

Study Caveat• This was a high-level analysis and wasn’t a true RCT design, so these results might only be

generalized for highly engaged customers who opted in. To eliminate possible sample selection bias and for further sensitivity check, matching methods have to be employed, and sample selection phenomenon would need to be taken into account.

Text Message Campaign – Opt-In TOU Pilot• Campaign Background

‒ Of the 21,534 initial customers in the Opt-In TOU Pilot, 2,677 elected to receive Text Message Alerts (12.4% take rate) as part of the Enhanced ME&O Pilot group

‒ Current Opt-Out rates remain low at ~ 4%‒ SCE sent 2 text alerts per month about how TOU

works, which season currently applies for their rate, and additional tips. To date SCE has sent 29 text messages and will send 1 to 2 more additional messages.

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• Results ‒ There is some indication that ME&O texts helped

some segments remember the peak hours better, but there are contradictory findings as well.

‒ One reason for the contradictory findings could be that the ME&O messages weren’t targeted by household usage or characteristics.

Tiered Rate Pricing UpdatesJune 2016 to June 2017

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Residential (Non-CARE) - ( ¢/kWh) 6/1/2016 6/1/2017 % Difference % of Non-CARE Baseline*

Baseline 15.7 ¢ 16.2 ¢ 3.5% 100%

Non Baseline 101% - 200% BL 22.9 ¢ 24.8 ¢ 8.1% 152%

201% - 400% BL 29.2 ¢ 24.8 ¢ (15.2%) 152%

Over 400% of BL 29.2 ¢ 31.2 ¢ 6.9% 192%

Residential (CARE) - ( ¢/kWh) 6/1/2016 6/1/2017 % Difference % of Non-CARE Baseline*

Baseline 10.2 ¢ 11.0 ¢ 7.4% 67%

Non Baseline 101% - 200% BL 15.7 ¢ 16.7 ¢ 6.0% 102%

201% - 400% BL 21.7 ¢ 16.7 ¢ (23.3%) 102%

Over 400% of BL 21.7 ¢ 21.0 ¢ (3.3%) 129%

* Ratio’s refer to June 2017 rates