5. Substantial Contribution
In evaluating whether a customer made a substantial contribution to a proceeding, we look at several things. First, we look at whether the Commission adopted one or more of the factual or legal contentions, or specific policy or procedural recommendations put forward by the customer. (§ 1802(i).) Second, if the customer's contentions or recommendations paralleled those of another party, we look at whether the customer's participation unnecessarily duplicated or materially supplemented, complemented, or contributed to the presentation of the other party. (§§ 1801.3(f) and 1802.5.)
As described in § 1802(i), the assessment of whether the customer made a substantial contribution requires the exercise of judgment.
In assessing whether the customer meets this standard, the Commission typically reviews the record, composed in part of pleadings of the customer and, in litigated matters, the hearing transcripts, and compares it to the findings, conclusions, and orders in the decision to which the customer asserts it contributed. It is then a matter of judgment as to whether the customer's presentation substantially assisted the Commission.6
Should the Commission not adopt any of the customer's recommendations, compensation may still be awarded if, in the judgment of the Commission, the customer's participation substantially contributed to the decision or order. Fox example, if a customer provided a unique perspective that enriched the Commission's deliberation and the record, the Commission could find that the customer made a substantial contribution. With this guidance in mind, we turn to the contributions GPI asserts it made in these proceedings.
Overall GPI claims that it has been an active participant in the Commission's RPS proceeding since the beginning of the program in 2003. GPI states that it participated in workshops, and provided testimony, briefs and comments on issues addressed in the decisions. We now look at the specific claimed contributions.
5.1. D.07-02-011, Approval of 2007 RPS Procurement Plans
GPI states that it made a substantial contribution to this decision in the area of clarifying the definition of renewable energy credits (RECs). PG&E and SCE had proposed changes to the Commission's definition of a REC. GPI argued in its comments on the Proposed Decision7 that additional clarifying language was necessary, and the changes should be extended to the definition of the REC in the standard terms and conditions on RECs. In support of its claim, GPI cites D.07-02-011 at 41, which states:
We decline to add "any other tradable rights" as proposed by PG&E for a fifth item in the list of what is an environmental (green) attribute. The list is already characterized as "include[s] but not limited to." Nonetheless, it is unreasonable to add a term as undefined and open-ended as "any other tradable right," particularly since it may cause unintended disputes with regard to taking of property rights. We saw no need for language this broad in 2004, and similarly see no need today. Finally, we combine PG&E's proposed fourth term with the third term, as recommended by GPI.
The Decision also agrees with GPI by saying: "We similarly conform Section 3.4 of the standard terms and conditions for RECs (as recommended by GPI in comments on the proposed decision)." D.07-02-011 at 41.
In addition, D.07-02-011 adopted Conclusion of Law 14 at 68, which states:
Each Plan should include a definition of RECs as proposed by PG&E, SCE's additional language for conformance with SB 107 should be included for SCE's Plan, and "Environmental Attribute" should be changed to "Green Attribute" with most of the further changes recommended by PG&E.
GPI argues that the Conclusion of Law uses the word "most" because the Commission adopted GPI's suggested changes, rather than using PG&E's language verbatim.
We have reviewed the record and concur that GPI is correct that it made several contributions, including suggested language that was superior to that proposed by PG&E, and was adopted. GPI also proposed combining PG&E's proposed third and fourth term in a series of items that compose RECs. This GPI proposal was adopted. The combination, however, was found to be problematic and was effectively reversed by D.07-05-057. GPI failed to make a substantial contribution in its recommendation to combine the third and fourth term. GPI's accounting does not differentiate its definition work between REC issues: (a) work on the combination of the third and fourth term, and (b) work on other than the combination of the third and fourth term. Absent this data, we disallow 25% of GPI's hours which relate to its work on D.07-02-011, outlined as follows:
Participant |
Hours Requested |
Work Year |
Approved hours minus 25% reduction8 |
G. Morris |
83.0 |
2006 |
62.3 |
G. Morris |
20.0 |
2007 |
15.0 |
V. Morris |
15.0 |
2006 |
11.3 |
V. Morris |
9.5 |
2007 |
7.1 |
Z. Harrold |
22.0 |
2007 |
16.5 |
5.2. D.07-05-057, Modifying D.07-02-11 Regarding Definition of Green Attributes
In D.07-05-057, GPI joined PG&E, SDG&E, and TURN in requesting a correction of an inadvertent error in the definition of the REC that was adopted in D.07-02-011. The Commission adopted the joint petitioners' request, in large part because the correction was of language that GPI had originally provided, and GPI was on record as requesting the clarifying change: "GPI, as a co-signer of the April 17, 2007 letter, states that it did not mean to change SB 107's statutory definition of REC when recommending combination of the two clauses." (D.07-05-057 at 2.)
GPI submits that its substantial contribution to D.07-05-057 led to Findings of Fact 1 and 2, Conclusion of Law 2, and the Ordering Paragraph as evidenced by these contents in the decision:
Findings of Fact
1. The Commission adopted a recommendation of GPI to modify a proposal of PG&E regarding the definition of Green Attributes.
2. GPI now states that it did not mean for its recommendation to change SB 107's statutory definition of RECs and GPI joins three other parties in recommending a change.
Conclusions of Law
2. The recommendation of Joint Parties to modify the definition of Green Attributes should be adopted.
IT IS ORDERED that the definition of Green Attributes in Decision 07-02-011 (mimeo., at 42) is corrected in relevant part.
We disagree with GPI's assessment of its claim of substantial contribution to D.07-05-027. GPI joined other petitioners in seeking correction to GPI's prior proposal to combine the third and fourth term in a series in the REC definition. The petition and D.07-05-027 would not have been necessary if GPI's initial work had been more accurate. As such, we disallow 6 hours of Morris' 2007 work for inefficient effort.
5.3. D.08-02-008, Approval of 2008 RPS Procurement Plans
GPI submits that it substantial contributions to D.08-02-008 were made in the areas of unlimited earmarking of contracts and procuring towards the 33% renewable target.
On the subject of the unlimited use of earmarking in the flexible-compliance process, GPI argued against the extension of the rules that the Commission ultimately adopted in the decision. Nevertheless, GPI believes that evidence of its contribution to broadening the record is acknowledged in the decision in a footnote on page 17, which states:
Otherwise eligible for earmarking means (as PG&E and SCE say in reply comments on the proposed decision) that the applicable energy meets all other requirements for earmarking. Contrary to GPI's concern, this does not negate the safeguards that are in current earmarking rules, create unlimited earmarking, or change any existing rules. This is the case because pooling does not alter whether a contract is eligible for earmarking, the time limits associated with earmarking, or the amounts of energy permitted to be earmarked from year to year.
Moreover, GPI submits that the decision shares its overriding concern about the unlimited rollover of procurement deficits by concluding in Conclusion of Law 11:
Unlimited carry-forward of a procurement deficit is incompatible with the statutory provision that inadequate procurement in one year may be carried forward to no more than the following three years. (D.08-02-008 at 52.)
On the subject of the 33% target, GPI filed comments on the 2008 Procurement Plans on August 30, 2007, which argued that it is essential to enact a stretch goal for the renewables program, in order to continue and consolidate the progress already made.
GPI believes that its concerns were acknowledged on page 20 of the decision which states:
GPI, among others, supports the 33% by 2020 target, observing that to rest at 20% by 2010 would result in a quick burst of energy followed by an abrupt and precipitous halt. Also, as recently stated, we agree with Aglet that pursuing a 33% target is a policy goal of the Commission and one that should be pursued by the IOUs at this time.
GPI submits that, although the decision does not adopt annual procurement targets greater than the statutory limit of 20 percent, it does instruct the utilities to address, on a planning-level basis, 33% renewables by 2020. Conclusion of Law 13 states:
Retail sellers should be expected to increase RPS procurement each year toward a goal of 33% by 2020, but should not, at this time, be subject to penalties for failure to procure more than 20% by 2010.
We agree that GPI made a substantial contribution as outlined here. We did not adopt GPI's exact recommendation in all of these areas, but GPI made a substantial contribution to our discussion. The Commission's understanding in each of these areas was improved as a result of GPI's work, and the Commission's decision was influenced and improved as a result of GPI's concerns. We fully compensate GPI for all work related to D.08-02-008.
5.4. D.08-04-009, Compiling Standard Terms and Conditions
GPI asserts its substantial contribution to D.08-04-009 was made through its efforts to avert changes to the standard terms and conditions of the definition of RECs offered by PG&E. In support of this claim, it cites:
In its comments [on the proposed decision], PG&E suggests several changes to standard terms and conditions 2 which PG&E characterizes as non-substantive. In reply comments, a subgroup of Joint Parties [including GPI] contend the changes may adversely affect the interest of parties. We decline to make a change to the proposed decision given controversy about its effects absent adequate vetting of the change and its implications. (D.08-04-009 at 5-6.)
We agree that GPI made a substantial effort in fending off an effort to change the standard terms and conditions on the definition of RECs offered by PG&E. We fully compensate GPI for all work related to D.08-04-009.
5.5. D.09-06-018, Approval of RPS Procurement Plans
GPI asserts that it made a substantial contribution to D.09-06-018 in the areas of application of the project-viability calculator and prudent over-contracting in order to achieve state RPS goals. GPI's concerns focused on (a) how the project-viability calculator will be used in the RPS program, and (b) its belief that the utilities appear to be assuming a much higher rate of project success than is justified by historical experience, or by their own current experience with their current portfolios of contracts for new renewables projects.
In GPI's comments and replies on the February 3, 2009 Assigned Commission Commissioner's Ruling in this proceeding (filed February 27, 2009 and March 6, 2009), comments on the project-viability calculator (filed May 5, 2009), and comments on the Proposed Decision (filed May 21, 2009), GPI argued that the appropriate use of the project-viability calculator is not in determining which projects are or are not eligible for the short list, but rather in assigning a reasonable estimate of probability of success to the projects as one element of the consideration of whether they should make the short list, and in order to assess how many megawatt (MW) of projects under contract will be needed in order to realistically achieve the necessary operating MWs to provide for the utilities' RPS procurement obligations.
GPI submits that consistent with the advice it proffered in various comments and at the project-viability calculator workshop, the Decision adopts the project-viability calculator as part of the three utilities' procurement plans, but declines to use it as a tool to eliminate low-scoring bids from consideration,9 reaffirms the basic RPS compliance rules, declines to link the project-viability score to flexible compliance treatment of projects,10 and declines to link the project-viability score to the development security.11
GPI maintains that it has been consistent in its position that the utilities are not building a sufficient margin of expected contract failure into their RPS procurement planning efforts. GPI points out that the IOUs have collectively lost ground with respect to the attainment of their annual procurement targets every year since the inception of the RPS program in 2003. GPI states that some of its areas of concerns were addressed in the admonitions included in D.09-06-018, including: (1) that the flexible compliance provisions do not excuse a utility from fulfilling its RPS Program targets with actual deliveries of energy by the end of the flexible compliance period,12 and (2) the final paragraph on page 32-33 of the decision which states:
We have made it clear that success is not measured by contracts or promises but by actual deliveries of energy. Deficit deferral permitted for up to three years pursuant to flexible compliance provisions must ultimately be filled by actual deliveries no later than at the end of three years. Failure to do so exposes the utility to a penalty up to $25 million. [Footnote deleted.] This gives each utility a strong incentive to select viable projects, but permits a three-year window to allow for various contingencies. Moreover, we have consistently stated that each utility must include a reasonable margin of safety in its procurement in order to build a buffer against contingencies, and should build and operate its own plants, if necessary, to meet RPS Program targets.
We agree that in part based on GPI's concerns, the Commission reaffirmed basic compliance rules and declined to adopt the project viability calculator and its resulting score (a) as a deterministic tool, (b) for purposes of flexible compliance, or (c) as a strict link with project development security amounts. GPI's work made a substantial contribution to D.09-06-018 and, as such, we fully compensate GPI for all work related to D.09-06-018.
5.6. D.09-06-050, Establishing Price Benchmarks for Short-Term Contracts
GPI states that it made a substantial contribution to D.09-06-050 in the areas of setting short-term contracting parameters, use of short-term contracts for projects in startup and early-term operations, and the importance of including a renewable adder in benchmarks for RPS contract terms.
In its May 26, 2009 comments on the Proposed Decision, GPI pointed out that short-term contracts for RPS energy could be a useful option for new renewables projects under development in order to carry them through their startup, and, in some cases, period of pre-participation in local RPS programs. GPI asserts that its participation is acknowledged on page 11 of the decision (and is foundational to Finding of Fact 4 and Conclusion of Law 2), where GPI is identified as one of several parties[1] that pointed out that "valuable opportunities for short-term contracts could also arise with generation facilities in development that were close to commercial operation."
Additionally, GPI argues that it made a substantial contribution to the decision by making a case for the inclusion of a renewables adder in any price benchmark that is applied to the RPS program. GPI states that it advocated for this in various pleadings on June14, 2007, June 25, 2007, September 24, 2007, and May 26, 2009, the first three of which were in R.06-02-012. GPI submits that its position was adopted in principle by the Commission in D.09-06-050, although it believes the implementation is incomplete in the sense that the decision employs the use of an adder in the determination of a benchmark for very short-term contracts, but does not include one in the determination of a benchmark for moderately-short term contracts. GPI believes that its contribution is acknowledged on page 14 of the decision (and is foundational to Findings of Facts 9 and 10, and Conclusion of Law 4), which states:
Parties agree that this basic price should be supplemented by an additional renewable value, though they do not agree on what that value should be.
Lastly, GPI submits that it made a substantial contribution to the decision in areas where the Commission did not adopt GPI's recommendations
by enrichment of the record upon which the Commission made its final decision.
In supports of this claim, GPI states that it suggested that the Commission did
not need to move forward quickly with the development of a fast-track process for the approval of short-term RPS contracts, but rather use the standard of just and reasonable for such contracts. Additionally, GPI states that it argued for the use of five years, close to the adopted four, as the upper limit on very short-term contracts.
We agree that GPI made a substantial contribution as outlined above on these issues13 and should be fully compensated for all of its work related to D.09-06-050.
6 D.98-04-059, 79 CPUC 2d 628 at 653.
7 GPI's Comments on the Proposed Decision, filed January 31, 2008.
8 In Section 7.1 below we discuss disallowance of time associated with clerical tasks. This time has been removed prior to calculating the 25% reduction for lack of substantial contribution to D.07-02-011. That is, we disallow 9 hours of Morris' work in 2006 and 14.5 hours of Morris' work in 2007 spent "completing, filing and serving various pleadings," which we deem to be clerical in nature and not compensable. In the table above, we have removed these hours prior to our calculation of the 25% reduction in the hours GPI requests.
9 See D.09-06-018, Findings of Fact 11 and Conclusions of Law 10 and 13.
10 See D.09-06-018, Findings of Fact 12 and Conclusions of Law 14.
11 See D.09-06-018, Findings of Fact 10 and Conclusions of Law 12.
12 See D.09-06-018, Finding of Fact 15.
[1] CEERT, PG&E, SCE and SDG&E provided various comments on this point.
13 The Commission did not adopt GPI's suggestion to delay the development of the fast-track process, but GPI's comments about the state of RPS contracting were helpful in developing the record.
