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ALJ/CFT/jva Date of Issuance 12/22/2008
BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA
Order Instituting Rulemaking to Consider Smart Grid Technologies Pursuant to Federal Legislation and on the Commission's own Motion to Actively Guide Policy in California's Development of a Smart Grid System.
PUBLIC UTILITIES COMMISSION
December 18, 2008
SAN FRANCISCO OFFICE
ORDER INSTITUTING RULEMAKING
TABLE OF CONTENTS
Attachment A TITLE XIII - SMART GRID
Attachment B RESPONDENT ELECTRICAL CORPORATIONS
(Public Utilities Code Section 218)
Attachment C TEMPORARY SERVICE LIST
ORDER INSTITUTING RULEMAKING
The California Public Utilities Commission (Commission) initiates this proceeding pursuant to federal legislation as well as its own motion to consider policies for California investor-owned electric utilities (IOUs) to enhance the ability of the electric grid to support important policy goals including reducing greenhouse gas emissions, increasing energy efficiency and demand response, expanding the use of renewable energy, and improving reliability. The proceeding will consider setting policies, standards and protocols to guide the development of a smart grid system and facilitate integration of new technologies such as distributed generation, storage, demand-side technologies, and electric vehicles.
The Energy Independence and Security Act of 2007 (H.R. 6, 110th Congress, or "EISA") states:
It is the policy of the United States to support the modernization of the Nation's electricity transmission and distribution system to maintain a reliable and secure electricity infrastructure that can meet future demand growth...1
California shares this national goal, as demonstrated by its firm commitment to resource adequacy, reliability, distributed generation, and demand-side programs.
This proceeding is an opportunity to evaluate the IOUs' existing electric infrastructure and polices and the steps they have already taken toward modernizing their electricity grids, and to consider whether and to what extent the Commission should develop a forward-looking regulatory program that encourages electric utilities to develop smart grid systems.
Consequently, we seek to achieve the following in this rulemaking:
· Consider the principles and criteria that should guide the Commission's smart grid policies;
· Address the specific provisions of EISA that relate to smart grid investments and information;
· Determine the characteristics and requirements of a smart grid in California that would support existing policies;
· Identify the IOUs' existing activities and investments related to a smart grid;
· Consider whether standards and protocols are needed for the deployment of a smart grid in California and, if so, identify what the Commission's role should be in standards development, if any;
· Determine how the Commission should assess the costs and benefits of smart grid-related expenditures that may be necessary to meet the state's future needs;
· Develop an appropriate regulatory approach to support the development of a cost-effective smart grid in California;
· Address other issues as needed to guide Commission policy in this area.
Respondents for this proceeding shall be all electrical corporations.2 In addition, we will serve this order on all other load serving entities (LSEs) as defined in § 380(j) of the Public Utilities Code, who may wish to participate in this proceeding, as well as on the California Energy Commission (CEC), the California Independent System Operator (CAISO), and the service lists in the following Commission proceedings: Rulemaking (R.) 07-01-041 (Demand Response), R.06-04-010 (Energy Efficiency), R.08-02-007 (Long-Term Procurement Rulemaking), R.05-12-013 (Long Term Resource Adequacy Rulemaking), R.08-04-012 (Planning Reserve Margin Rulemaking) and Application (A.) 08-07-021 et al. (Energy Efficiency Program Plans).
1 EISA Section (§) 1301. For easy reference, the relevant portions of EISA are attached to this Order Instituting Rulemaking (OIR) as Attachment A.
2 EISA requires consideration of certain smart grid issues by "each State regulatory authority (with respect to each electric utility for which it has ratemaking authority)" (§ 1307). The Commission has ratemaking authority for all electrical corporations, as defined in Public Utilities Code § 218. They are listed in Attachment B to this OIR.