3. Selection of the EnerNOC Agreement
The EnerNOC Agreement was solicited via SDG&E's 2010-2012 Supply RFO.6 The 2010-2012 RFO was released to the public on March 9, 2007. Three products were sought: Product 1 - DR for initial delivery in 2010, 2011, or 2012, running for a total of 15 years; Product 2 - peakers or intermediate class resources, in SDG&E's territory, totaling a minimum of approximately 200 MWs as turnkey or power purchase agreements for a minimum of 15 years, with
on-line dates of between April 2010 and April 2012; and Product 3 - a generation facility, located inside or outside SDG&E's service territory of an approximately 500 MWs nameplate capacity, deliverable to SDG&E's service territory.
This Application addresses bids received and evaluated for Product 1 - DR. According to SDG&E, bids for Product 1 were for a product that "must be a means of reducing an end-use customer's demand and/or energy usage" that would reduce demand by at least 1.0 MW and be within SDG&E's service territory. Product 1 - DR offers were also required to comply with the policy guidance of the Energy Action Plan (I and II) and be in alignment with the state's "Demand Response Vision for the Future." Offers were also required to meet the Commission's definition of DR.
Generation resources located on the customer side of the meter, such as back-up generation, were disqualified as DR products in this offer.7 Products including DR committed on existing programs, or products for Direct Load Control programs targeted toward residential and business customers with demands of less than 100 kW, were also excluded. SDG&E sought offers that also met the resource adequacy requirements for DR as set forth by the Commission in D.05-10-042. Finally, the offer stated that SDG&E preferred DR products that would be available from May 1, 2010 through October 31, 2025. Products which were not available for all the months during this period required clarification from bidders, in detail, as to when the product would be available and the circumstances surrounding its availability.
SDG&E received a total of four offers for Product 1 - DR. Through its bid selection process,8 the number was narrowed, and SDG&E entered into negotiations with the top two ranking vendors, one of which was EnerNOC. SDG&E indicates that it is continuing to negotiate with the second vendor. If and when those negotiations result in an executed contract, SDG&E states that it will file a separate application for Commission approval of that contract.
6 SDG&E requested and was granted in the 2006 Long Term Procurement Plan (LTPP) proceeding authority to launch or continue competitive solicitations in advance of the Commission's final adoption of need for the 2006 LTPP. Recognizing that a final decision on the 2006 LTPP was still pending, the 2010-2012 RFO was designed to fill only a portion of the need identified during the development of the 2006 LTPP. The Commission's final approval of authorized need was provided in Decision
(D.) 07-12-052.
7 See D.06-11-049, pp. 57 - 58.
8 The bid selection process is detailed in Exhibit 1, pp. 10-20.
