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STATE OF CALIFORNIA EDMUND G. BROWN JR., Governor

PUBLIC UTILITIES COMMISSION

505 VAN NESS AVENUE

SAN FRANCISCO, CA 94102-3298

July 20, 2012 Agenda ID #11329

To: Service List for Proposed Resolution ALJ-268

Re: Additional Revisions to Proposed Resolution ALJ-268

As you know, on February 25, 2010, the Commission adopted Resolution ALJ-244, which updates the Commission's advice letter pilot program for certain transfers of utility property that require advance approval pursuant to Public Utilities Code Section 8511 (the pilot program), in view of Assembly Bill (AB) 698 (Stats. 2009, ch. 370) (effective January 1, 2010). Resolution ALJ-244 also extended the pilot program for an additional year until August 23, 2011. The Commission subsequently extended the pilot program until August 23, 2012 in Resolution ALJ-272 (adopted August 18, 2011).

On May 8, 2012, we mailed proposed Resolution ALJ-268, which makes the pilot program permanent and adopts a General Order codifying regulations for the advice letter program, to the service list for review and comment. We have responded to comments received from the parties in the text of the Resolution. The Commission has not yet acted on this proposed Resolution.

Since the mailing of proposed Resolution ALJ-268 to the service list, we have made additional changes to the General Order adopted in the Resolution. These changes include the addition of a new Rule 2.6 and a minor revision to reporting requirements in Rule 10, and are marked with a line in the right margin in the proposed General Order.

Although we are not required to do so, we are providing this additional opportunity for the parties to review and file comments on the above changes to the proposed General Order. Comments shall be limited to the above changes to the General Order.

Opening comments on this draft resolution shall be submitted to Administrative Law Judge (ALJ) Myra J. Prestidge, by no later than August 9, 2012, by mail sent to the above address, facsimile sent to (415) 703-1723, or by e-mail addressed to tom@cpuc.ca.gov. Reply comments shall be submitted to Judge Prestidge by August 14, 2012. Comments should be consistent with the requirements of Rule 14.5 of the Commission's Rules of Practice and Procedure. In addition, please serve a copy of your opening and reply comments on the service lists attached to this letter, to Assistant Chief Administrative Law Judge Janet Econome at jjj@cpuc.ca.gov; and Andrew Barnsdale, Energy Division, at bca@cpuc.ca.gov. Persons who do not have access to e-mail may serve a hard copy of their comments by mail. Please serve ALJ Prestidge, Assistant Chief ALJ Econome, and Andrew Barnsdale by hard copy and e-mail.

If you have questions, please do not hesitate to contact ALJ Prestidge at (415) 703-2629 or by email addressed to tom@cpuc.ca.gov; or Assistant Chief ALJ Econome at (415) 703-1494 or by e-mail at jjj@cpuc.ca.gov.

Very truly yours,

/s/ KAREN V. CLOPTON

Karen V. Clopton

Chief Administrative Law Judge

cc: Janet Econome, ACALJ

Attachment

ALJ/TOM/gd2 DRAFT Agenda ID #11329 (Rev. 3)

PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

R E S O L U T I O N

RESOLUTION ALJ-268. Adopts General Order ___, which makes permanent and modifies the Pub. Util. Code § 851 Pilot Program Established in Resolution ALJ-186, as modified by Resolution ALJ-202 and Resolution ALJ-244 and extended in Resolution ALJ-272.

SUMMARY

This resolution adopts General Order (GO) ___ (attached as Appendix A), which makes the Pub. Util. Code § 8512 pilot program established in Resolution ALJ-186 (adopted August 25, 2005), modified by Resolution ALJ-202 (adopted August 23, 2007) and Resolution ALJ-244 (adopted March 2, 2010) and extended by Resolution ALJ-272 (adopted August 18, 2011) (the pilot program), permanent, makes minor technical amendments to the pilot program regulations for the purpose of clarity, and renumbers and reorders the regulations.

We further direct Commission staff to hold a workshop with interested parties to discuss options for clarification of GO 69-C, which authorizes public utilities to implement certain transactions involving the transfer of minor, revocable interests in utility property, such as certain easements, licenses, or permits, without prior Commission approval, within 180 days of this order and to issue a written report to the Commission with recommendations within the following 120 days. The Director of the Commission Energy Division may extend the time for holding the workshop and/or submitting the workshop report to the Commission for good cause.

In addition, pursuant to Section 853(b), we grant PacifiCorp an exemption from Section 851 only for transactions that meet the following criteria: a) the transaction involves PacifiCorp property or assets located entirely outside of California, b) PacifiCorp has received any legally required approval of the transactions from governmental agencies regulating public utilities in other states in which PacifiCorp conducts business, to the extent that such approvals are legally required, c) the fair market value of the transaction allocated to California will not exceed $10,000, and d) the transaction, if it were reviewed by the Commission as part of making a discretionary decision, would not require environmental review pursuant to the California Environmental Quality Act.

BACKGROUND

A. Commission Adoption of Resolution ALJ-186

On August 25, 2005, the Commission adopted Resolution ALJ-186, which established a two-year pilot program for processing and approving certain transfers of interests in utility property through advice letters, rather than formal applications under Section 851. Section 851 generally requires Commission approval of any sale, lease, encumbrance, mortgage, or other transfer or disposition of an interest in utility property that is necessary or useful in the provision of the utility's services to the public.3 The purpose of the Commission's review is to ensure that the proposed transaction is not adverse to the public interest, i.e., does not impair the ability of the utility to provide safe and reliable service to customers at reasonable rates.

Before our adoption of the pilot program, utility transactions involving the transfer or disposition of interests in property necessary or useful in the provision of services to the public generally required a formal application and a Commission decision pursuant to Section 851. The purpose of the pilot program was to expedite and simplify the Commission's review and approval of non-controversial transactions involving the transfer or conveyance of interests in utility property that did not require environmental review by the Commission as a Lead Agency under the California Environmental Quality Act (CEQA), and did not warrant more extensive review by the Commission through the formal application process.

1 The Commission originally adopted the pilot program in August 2005 in Resolution ALJ-186, and amended the pilot program in Resolution ALJ-202 in August 2007.

2 All subsequent Code references are to the Public Utilities Code, unless otherwise stated.

3 Exceptions to this requirement apply if the Commission exempts a utility, class of utility, transaction, or class of transactions from the requirements of Section 851 pursuant to Section 853(b), including whether the particular transaction meets the criteria stated in General Order (GO) 69-C.

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