2. Standard of Review: The CPCN/CEQA Process
Two different regulatory schemes govern the Commission's responsibilities in reviewing GRS' and PG&E's requests for the approval of the Applications. First, §§ 1001 et seq., require that before Applicants can construct the Proposed Project, the Commission must grant a CPCN on the grounds that the present or future public convenience and necessity require or will require construction of the Proposed Project. In addition, construction of power line and substation facilities operating between 50 kV and 200 kV, such as those proposed in the PG&E Application, requires a PTC, pursuant to the requirements of General Order (GO) 131-D.
Second, CEQA (Public Resources Code §§ 21000, et seq.) requires that the Commission, as lead agency for the Proposed Project, prepare a document assessing the environmental effects of the Proposed Project for the Commission's use in considering the request for a CPCN or PTC.11
These requirements are discussed separately below.
2.1. CPCN Requirements
The CPCN requirements of the Public Utilities Code include a determination of whether the Proposed Project is necessary. In addition, before granting a CPCN, the Commission considers the financial impacts of a project on the utility's ratepayers and shareholders. The Commission reviews the estimated cost of a project, and for those projects estimated to cost more than $50 million, the Commission sets the maximum amount that can be spent by the utility on a project without seeking further Commission approval.
The Gas Storage Decision (Decision (D.) 93-02-013) and subsequent decisions modified some of these requirements as they apply to competitive gas storage providers under the Commission's "let the market decide" policy. These modifications apply to the Applications and are discussed more fully below.
In addition, § 1002 requires the Commission to consider the following factors in determining whether or not to grant a CPCN: (1) community values, (2) recreational and park areas, (3) historical and aesthetic values, and (4) influence on the environment.
2.2. PTC Requirements
GO 131-D defines an electric "power line" as one designed to operate between 50 and 200 kV, and requires utilities to first obtain Commission authorization, in the form of a PTC, before beginning construction of a power line or substation.12 GO 131-D requires PTC applications to:
1) Include a description of the proposed facilities and related costs, a map, reasons the route was selected, positions of the government agencies having undertaken review of the project, and a PEA;13
2) Show compliance with the provisions of CEQA related to the Proposed Project, including the requirement to meet various public notice provisions;14 and
3) Describe the measures to be taken or proposed by the utility to reduce the potential for exposure to electric and magnetic fields (EMF) generated by the Proposed Project.15
2.3. CEQA Requirements
CEQA requires that the Commission consider the environmental consequences before acting upon or approving the Proposed Project.16 Under CEQA, the Commission must act as either the Lead Agency or a Responsible Agency for project approval.17 Here, the Commission is the Lead Agency. If a Lead Agency determines that a proposed project would not have a significant effect on the environment, CEQA requires the Lead Agency to adopt a Negative Declaration or an MND to that effect.
Based on its initial study, the Commission's Energy Division (Energy Division) determined that an MND is required because, as discussed below, if certain mitigation measures are adopted, the Proposed Project will not have a significant adverse impact on the environment.
To administer the Commission's dual responsibilities under the Public Utilities Code and Public Resources Code, the proceeding was bifurcated into a review of non-environmental (CPCN/PTC) issues and an environmental review under CEQA. The environmental and non-environmental parts of the proceeding converge at the time the Final MND is submitted into the formal proceeding for adoption by the Commission, and the MND becomes part of the record at that time.
11 If a lead agency determines that a proposed project would not have a significant effect on the environment, the lead agency shall adopt a negative declaration to that effect. (Public Resources Code § 21080(c).) If there is substantial evidence, in light of the whole record before the lead agency, that the project may have a significant effect on the environment, an environmental impact report shall be prepared. (Public Resources Code § 21080(d).)
12 Section I and Section III.B.
13 Section IX.B.1. PTC applications for power lines need not include a detailed analysis of purpose and necessity, a detailed estimate of cost and economic analysis, a detailed schedule, or a detailed description of construction methods beyond that required for CEQA compliance. (Section IX.B.1.f.)
14 Section IX.B.2-5. Compliance with Section IX.B is not required for proposed power lines and substations that have undergone environmental review as part of a larger project, and for which the final CEQA document finds no significant unavoidable environmental impacts caused by the proposed line or substation. (Section III.B.1.f.)
15 Section X.
16 CEQA Guidelines, Section 15050(b).
17 The Lead Agency is the public agency with the greatest responsibility for supervising or approving the Proposed Project as a whole. (CEQA Guidelines, Section 15051(b).)
