Implementation of Power Rates Rate Applications Group LADWP Rates & Contracts

Power Rates - Overview  Two year increase for FY and FY  FY 12-13: 4.9% general increase  FY 13-14: 6.0% general increase  Overall 2-year system average increase: 11.1%, 1.4¢/kwh  Impact of rate increases is projected to be equal across all rate classes, but the impact may vary between customers within classes, depending on consumption levels and patterns  New Ordinance is incremental to existing rates that are currently in effect, which are capped

Power Rates - Background  Purpose: higher costs to DWP to meet legal/regulatory requirements, and to replace aging infrastructure  Rates are the result of an in-depth analysis and coordination between DWP staff and outside consultants. Rates reflect extensive review by the independent Ratepayer Advocate  Extensive public input was solicited and received through community outreach in 2011 and in 2012

Power Rates - Implementation  Projected implementation date is November 11, 2012  Written ordinance shows incremental numbers that will be added to existing capped rates  CIS and DWP bills will display the sum total of the capped and incremental rates  Several new billing factors have been created, which will be embedded in current line items on CIS and on DWP bills

Power Rates - Implementation  Approved ordinance includes several new billing factors: –VEA – Variable Energy Adjustment –CRPSEA – Capped Renewable Portfolio Standard Energy Adjustment –VRPSEA – Variable Renewable Portfolio Standard Energy Adjustment –IRCA – Incremental Reliability Cost Adjustment  VEA, CRPSEA and VRPSEA will be embedded with the ECA on CIS  IRCA will be embedded with the ESA and RCA

Power Rates – Residential Rate R-1A Monthly rates through June 30, 2013 High Season (June – Sept) Low Season (Oct – May) Residential R-1ACappedIncrementalTotalCappedIncrementalTotal Energy Charge - per kwh Zone 1 Tier 1 - first 350 kwh $ $ $ $ $ $ Tier 2 - next 700 kwh $ $ $ $ $ $ Tier 3 - greater than 1050 kwh $ $ $ $ $ $ Zone 2 Tier 1 - first 500 kwh $ $ $ $ $ $ Tier 2 - next 1000 kwh $ $ $ $ $ $ Tier 3 - greater than 1500 kwh $ $ $ $ $ $ charges below are in addition to Energy ChargesElements Only in Capped Ordinance ECA - per kwh $ $ - $ $ - $ ESA - per kwh $ $ - $ $ - $ RCA - per kwh $ $ - $ $ - $ Minimum Charge - fixed charge per month $10.00 $ - $10.00 $ - $10.00 Elements Only in Incremental Ordinance VEA - per kwh $ - TBD $ - $ ( ) CRPSEA - per kwh $ - TBD $ - $ ( ) VRPSEA - per kwh $ - TBD $ - $ IRCA - per kwh $ - $ $ - $

Power Rates – before & after (residential rate R1A) –Example shown here is for High Season –Overall bill format will not change –Existing bill shows line items, bill calculations, etc –ECA line item will now include VEA, CRPSEA, and VRPSEA –ESA line item will continue to include RCA, and will now include IRCA New bill: Energy 500 x $ = $35.91 = $35.91 ECA 500 x $ = $28.83 = $28.83 ESA 500 x $ = $2.87 = $2.87 Tax $67.60 x 0.1 = $6.76 State (unchanged)= $0.15 TOTAL = $74.51

Power Rates – Residential Rate R-1B (TOU) Monthly rates through June 30, 2013 High Season (June – Sept) Low Season (Oct – May) Residential R-1BCappedIncrementalTotalCappedIncrementalTotal Service Charge $ per month $ 8.00 $ - $ 8.00 $ - $ 8.00 Energy Charge - per kwh High Peak Period $ $ $ $ $ $ Low Peak Period $ $ $ $ $ $ Base Period $ $ $ $ $ $ Electric Vehicle Discount $ $ ( ) $ - $ ( ) $ - $ ( ) charges below are in addition to Energy ChargesElements Only in Capped Ordinance ECA - per kwh $ $ - $ $ - $ ESA - per kwh $ $ - $ $ - $ RCA - per kwh $ $ - $ $ - $ Elements Only in Incremental Ordinance VEA - per kwh $ - TBD $ - $ ( ) CRPSEA - per kwh $ - TBD $ - $ ( ) VRPSEA - per kwh $ - TBD $ - $ IRCA - per kwh $ - $ $ - $

Power Rates – Commercial Rate A-1A Monthly rates through June 30, 2013 High Season Low Season Small General Service A-1ACappedIncrementalTotalCappedIncrementalTotal Service Charge $ per month $ 6.50 $ - $ 6.50 $ - $ 6.50 Facilities Charge $ per kw $ 5.00 $ 0.29 $ 5.29 $ 5.00 $ 0.29 $ 5.29 Energy Charge $ per kwh $ $ $ $ $ $ charges below are in addition to Energy ChargesElements Only in Capped Ordinance ECA - per kwh $ $ - $ $ - $ ESA - per kw $ 0.46 $ - $ 0.46 $ - $ 0.46 RCA - per kw $ 0.96 $ - $ 0.96 $ - $ 0.96 Elements Only in Incremental Ordinance VEA - per kwh $ - TBD $ - $ ( ) CRPSEA - per kwh $ - TBD $ - $ ( ) VRPSEA - per kwh $ - TBD $ - $ IRCA - per kw $ - $ 0.36 $ - $ 0.36

Monthly rates through June 30, 2013 High Season Low Season Primary General Service A-2BCappedIncrementalTotalCappedIncrementalTotal Service Charge $ per month $ $ - $ $ - $ Facilities Charge $ per kw $ 5.00 $ 0.29 $ 5.29 $ 5.00 $ 0.29 $ 5.29 High Peak Demand $ per kw $ 9.00 $ 0.50 $ 9.50 $ 4.25 $ 0.25 $ 4.50 Low Peak Demand $ per kw $ 3.25 $ 0.25 $ 3.50 $ - Base Demand $ per kw $ - High Peak Energy $ per kwh $ $ $ $ $ $ Low Peak Energy $ per kwh $ $ $ $ $ $ Base Energy $ per kwh $ $ $ $ $ $ Electric Vehicle Discount $ $ ( ) $ - $ ( ) $ - $ ( ) charges below are in addition to Energy and Demand Charges Elements Only in Capped Ordinance ECA - per kwh $ $ - $ $ - $ ESA - per kw $ $ - $ $ - $ RCA - per kw $ $ - $ $ - $ Elements Only in Incremental Ordinance VEA - per kwh $ - TBD $ - $ ( ) CRPSEA - per kwh $ - TBD $ - $ ( ) VRPSEA - per kwh $ - TBD $ - $ IRCA - per kw $ - $ 0.36 $ - $ 0.36 for Reactive Energy Charges please refer to attachments Power Rates – Commercial Rate A-2B

Power Rates – before & after (commercial rate A2B) (High Season bill shown here) high peak high peak Demand 47.2 x $9.50 = $ Energy 2960 x $ = $ ECA 2960 x $ = $ Tax $ x 12.5% = $95.65 State 2960 x $ = $0.86 Total high peak= $ low peak low peak Demand 48 x $3.50 = $ Energy 4480 x $ = $ ECA 4480 x $ = $ Tax $ x 12.5% = $76.86 State 4480 x $ = $1.30 Total low peak= $ base base Energy 15,840 x $ = $ Service 1 month x $28.00 = $28.00 Facilities 53.6 x $5.29 = $ ECA 15,840 x $ = $ ESA 53.6 x $1.78 = $95.41 Tax $ x 12.5% = $ State 15,840 x $ = $4.59 Total base= $ TOTAL BILL= $

Monthly rates through June 30, 2013 High Season Low Season Subtransmission Service A-3ACappedIncrementalTotalCappedIncrementalTotal Service Charge $ per month $ $ - $ $ - $ Facilities Charge $ per kw $ 4.00 $ 0.39 $ 4.39 $ 4.00 $ 0.39 $ 4.39 High Peak Demand $ per kw $ 9.00 $ 0.35 $ 9.35 $ 4.00 $ 0.15 $ 4.15 Low Peak Demand $ per kw $ 3.00 $ 0.15 $ 3.15 $ - Base Demand $ per kw $ - High Peak Energy $ per kwh $ $ $ $ $ $ Low Peak Energy $ per kwh $ $ $ $ $ $ Base Energy $ per kwh $ $ $ $ $ $ Electric Vehicle Discount $ $( ) $ - $( ) $ - $( ) charges below are in addition to Energy and Demand Charges Elements Only in Capped Ordinance ECA - per kwh $ $ - $ $ - $ ESA - per kw $ $ - $ $ - $ RCA - per kw $ $ - $ $ - $ Elements Only in Incremental Ordinance VEA - per kwh $ - TBD $ - $ ( ) CRPSEA - per kwh $ - TBD $ - $ ( ) VRPSEA - per kwh $ - TBD $ - $ IRCA - per kw $ - $ 0.36 $ - $ for Reactive Energy Charges please refer to attachments Power Rates – Commercial Rate A-3A

Power Rates – Some Important Points to Consider  Certain customers will be impacted more –Residential high kwh users –Commercial users with poor load factors (high demand, low consumption)  In addition to the Ratepayer Advocate, this rate action had widespread support, including business representatives (LA Chamber of Commerce, LA Times) and environmental groups (Sierra Club)  Even after this rate action, rates are still less than or competitive with neighboring utilities  Rate action enables DWP to continue and expand efficiency programs, which help customers manage their costs