PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Item #14

ID #9722

ENERGY DIVISION RESOLUTION E-4357

September 23, 2010

REDACTED

RESOLUTION

Resolution E-4357. Pacific Gas and Electric Company requests approval of a renewable power purchase agreement with Desert Sunlight Holdings, LLC.

PROPOSED OUTCOME: This Resolution approves cost recovery for a Pacific Gas and Electric Company renewable energy power purchase agreement with Desert Sunlight Holdings, LLC. The power purchase agreement is approved without modifications.

ESTIMATED COST: Costs of the power purchase agreement are confidential at this time.

By Advice Letter 3629-E filed on March 8, 2010.

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SUMMARY

Pacific Gas and Electric Company's renewable energy power purchase agreement with Desert Sunlight Holdings, LLC complies with the Renewables Portfolio Standard procurement guidelines and is approved without modification

Pacific Gas and Electric Company (PG&E) filed Advice Letter (AL) 3629-E on March 8, 2010, requesting California Public Utilities Commission (Commission) review and approval of a power purchase agreement (PPA) between PG&E and Desert Sunlight Holdings, LLC (Desert Sunlight), a wholly owned subsidiary of First Solar, Inc. Under the proposed PPA, PG&E would procure an estimated average of 619 gigawatt hours per year (GWh/yr) of renewable energy from the planned 300 megawatt (MW) solar photovoltaic facility. The proposed PPA has a guaranteed delivery term of 25 years.

This resolution approves the Desert Sunlight PPA without modification. The Desert Sunlight PPA resulted from PG&E's 2008 RPS solicitation. The project is consistent with PG&E's 2008 RPS Procurement Plan, including its resource need, which the Commission conditionally approved in Decision 08-02-008. Because the contract was executed greater than 18 months following the close of PG&E's 2008 RPS solicitation, costs of the PPA were compared to offers received in PG&E's 2009 RPS solicitation. Deliveries under the Desert Sunlight PPA are reasonably priced and fully recoverable in rates over the life of the contract, subject to Commission review of PG&E's administration of the PPA.

The following table provides a summary of the Desert Sunlight PPA: