3. Discussion
3.1. Necessity
The Project is designed as a peaking facility to meet electrical generation load in Southern California during periods of high demand. The Project incorporates newer turbine generator technology that provides faster startup times and greater efficiency than prior peaking generators.2 We acknowledged the need for additional generation such as the Project will produce in the 2008 Energy Action Plan where we state:
Even with energy efficiency, demand response, and renewable resources, investments in conventional power plants and transmission and distribution infrastructure will still be needed.3
Consistent with the statement above, the proposed Tie-Line will serve California consumers by delivering power produced by the Project during periods of high demand to the CAISO controlled grid. We therefore find it to be necessary.
3.2. Financing and Ratepayer Impact
Typically, before granting a CPCN, the Commission must consider an analysis of the financial impacts of the proposed project on the utility's ratepayers and shareholders. The rationale for this line of inquiry has been set forth as follows:
Traditionally, utilities apply for [a] CPCN for new projects which will be placed into the utility's rate base, allowing the utility to earn a rate of return on its investment and to depreciate its capital investment over a reasonable period of time. It is the ratepayers who usually pay these costs. The provisions of the PU [Public Utilities] Code related to CPCN require the Commission to consider the cost effectiveness of a proposed project as a means of meeting a perceived need before saddling ratepayers with the economic burden of new investments.4
The estimated cost of the Tie-Line and related interconnection facilities is $7.19 million. SCE states that "the construction of the Tie-Line will cause no direct financial impact on SCE's ratepayers as the total costs of the Tie-Line including the construction, operation, and maintenance charges, will be paid entirely by WCE." (Application at 3.) Given SCE's representations, we need not consider the cost-effectiveness of the project or issues related to ratepayer impact. However, in what may be an abundance of caution, as a condition to approval of this CPCN, we direct that SCE may not recover any costs associated with the
Tie-Line or the Project from ratepayers. We further direct that SCE shareholders, as opposed to ratepayers, should assume all risk and liability associated with the Tie-Line related to the Project, based on its agreement with WCE, and that SCE may not pass on to ratepayers, directly or indirectly, any costs, risks, or liability associated with the Tie-Line or the Project.
3.3. Compliance with Commission Rules and Orders
SCE has included a description of the project and its location (see Application, Appendix B at 5), project maps and engineering and design diagrams consistent with Pub. Util. Code § 1003.5 (Application, Appendices B and F), a construction management plan as required by Pub. Util. Code
§ 1003.5(e) (Application, Appendix D), cost estimates as required by Pub. Util. Code § 1003.5(d) (Application, Appendix B), and referenced a copy of its articles of incorporation as required by Pub. Util. Code § 1004 (Application at 10).5 Based in part on this showing, the CEC determined:
The Conditions of Certification contained in this Decision, if implemented by the project owner, ensure that the whole of the project will be designed, constructed, and operated in conformity with applicable local, regional, state, and federal laws, ordinances, regulations, and standards, including applicable public health and safety standards, and air and water quality standards.
(Application, Appendix B at 311.) Thus, SCE has satisfied the other requirements that are necessary for the issuance of a CPCN.
3.4. Environmental Review
Pursuant to CEQA requirements,6 the Commission must consider the environmental consequences of a project that is subject to the Commission's discretionary approval. In doing so, the Commission must act as either a Lead Agency or Responsible Agency. The Lead Agency is the one with the most responsibility for supervising or approving the project as a whole.7
In this case, the CEC is the Lead Agency and the Commission is a Responsible Agency. As Lead Agency, the CEC conducted an environmental analysis of the Project and associated tie-line pursuant to the CEC's jurisdiction under Pub. Res. Code §§ 25500 et seq., to site power plants and their related
tie-lines. The CEC's siting process and associated documents are functionally equivalent to an Environmental Impact Report.8
CEQA requires the Commission to consider the Lead Agency's environmental documents and findings before acting upon or approving a project.9 The Commission must review the CEC's environmental documents and findings, including any Conditions of Certification or mitigation or monitoring programs, if any, as they pertain to the tie-line and cannot rely on the Final Staff Assessment for these purposes. The CEC certified the Final Staff Assessment on February 27, 2008.
The CEC's environmental analysis assessed the impacts of the Project and tie-line with respect to transmission line engineering, safety and nuisance; air quality; public health; hazardous materials management; worker safety/fire protection; biological resources; soil and water resources; cultural resources; geological and paleontological resources; waste management; land use; noise; socio-economics; traffic and transportation; and visual resources. As a result of its environmental analysis, the CEC adopted Conditions of Certification for the Project and Tie-Line. The CEC found that:
Implementation of the Conditions of Certification contained in the accompanying text will ensure protection of environmental quality and assure reasonably safe and reliable operation of the facility. The Conditions of Certification also assure that the project will neither result in, nor contribute substantially to, any significant direct, indirect, or cumulative adverse environmental impacts. (Application, Appendix B at 311.)
The record in this proceeding includes CEC Order No. 08-0227-02, which contains the CEC's environmental analysis and Conditions of Certification. We have reviewed the CEC's environmental documents and findings as they pertain to the Tie-Line, and we find these documents are adequate for our
decision-making purposes.
We conclude that the CEC reasonably found that the proposed Tie-Line, as conditioned, will not result in any significant direct, indirect, or cumulative adverse environmental impacts. Therefore, consistent with CEQA Guidelines 15091 and 15096(h), we will adopt the CEC's Conditions of Certification that pertain to the Tie-Line. The CEC is responsible for monitoring compliance with its Conditions of Certification. Thus, there is no need for us to adopt a program for monitoring and enforcing compliance with the CEC's Conditions of Certification as would otherwise be required by CEQA Guideline 15091(d).
The entity that submitted comments on the application raises concerns about the potential risks to human health created by the proximity of the electric power lines to individuals working in one of the adjacent buildings.10 Both the CEC and the Commission consider the possibility of health effects from exposure to electric and magnetic fields (EMFs) to be an important issue. The CEC requires WCE to comply with the Commission's policy on field strength management. Specifically, the CEC's final decision directs that:
The project owner shall construct the proposed transmission lines according to the requirements of California Public Utility Commission's GO-95, GO-52, GO-131-D, . . . and Southern California Edison's EMF-reduction guidelines.11 (Application, Appendix B at 266.)
The Commission has examined EMF impacts in several previous proceedings.12 We found the scientific evidence presented in those proceedings was uncertain as to the possible health effects of EMFs, and we did not find it appropriate to adopt any related numerical standards. Because there is no agreement among scientists that exposure to EMF creates any potential health risk, and because CEQA does not define or adopt any standards to address the potential health risk impacts of possible exposure to EMFs, the Commission does not consider magnetic fields in the context of CEQA and determination of environmental impacts.
However, recognizing that public concern remains, we do require (pursuant to GO 131-D, Section X.A) that all requests for a CPCN include a description of the measures taken or proposed by the utility to reduce the potential for exposure to EMFs generated by the proposed project. We developed an interim policy that requires utilities, among other things, to identify the no-cost measures undertaken, and the low-cost measures implemented, to reduce the potential EMF impacts. The benchmark established for low-cost measures is 4% of the total budgeted project cost that results in an EMF reduction of at least 15% (as measured at the edge of the utility
right-of-way). SCE provides its EMF Field Management Plan and notes that it has implemented magnetic field reduction measures that include:
· Implementing phasing arrangement(s) to reduce magnetic field levels at the edges of the right-of-way.
· Using pole heights that meet or exceed the Preferred Design criteria as specified in SCE's EMF Design Guidelines.
· Placing existing nearby 66 kV subtransmission lines underground.
(See Application, Appendix E.) SCE's EMF plan for the Tie-Line is consistent with D.93-11-013 and D.06-01-042, as well as the applicable national and state safety standards for the Tie-Line.
2 CEC Final Decision at 10.
3 Energy Action Plan 2008 Update at 15.
4 Re Pacific Gas and Electric Company, 51 CPUC2d 594 (Decision (D.) 93-10-039).
5 SCE did not include a balance sheet and/or statement of income in the application because it is not funding the construction of the Tie-Line.
6 The provisions of CEQA are set forth in Pub. Res. Code § 21000 et seq.
7 CEQA Guidelines (Title 14, Division 6, Chapter 3 of the California Code of Regulations), Section 15051(b).
8 Pub. Res. Code § 25519(c).
9 CEQA Guidelines 15050(b) and 15096.
10 See footnote 1 infra.
11 The project owner is required to submit evidence of compliance with these conditions prior to starting construction of the transmission line or related structures and facilities. (Application, Appendix B at 269.)
12 D.06-01-042 and D.93-11-013.
