7. Assignment of Proceeding

Rachelle B. Chong is the assigned Commissioner and Timothy J. Sullivan is the assigned ALJ in this proceeding.

1. Parties filed comments in this rulemaking on February 9, 2009 and reply comments on March 9, 2009.

2. Workshops in this proceeding took place on May 27, June 5, June 28, July 15 and July 21, 2009 to address issues identified in this proceeding.

3. On September 28, 2009, a joint ruling of the assigned Commissioner and the ALJ sought comments and replies on tentative policies and findings pertaining to EISA.

4. Parties filed comments on October 26 and reply comments on November 2, 2009 on the policies and findings pertaining to EISA contained in the September 28, 2008 joint ruling.

5. Sierra Pacific, Mountain Utilities, and PacifiCorp do not operate in the CAISO's control area.

6. Many grid investments, such as a pole replacement or grid extension, are routine matters and tasks that utilities must perform.

7. Requiring a utility to demonstrate that it has considered a "Smart Grid" technology before making an investment in poles, wires, or grid extensions would delay infrastructure investment, increase costs, and increase the response time for consumer service.

8. Requiring Sierra Pacific, Mountain Utilities, PacifiCorp and Bear Valley Electric to demonstrate that they have considered a Smart Grid investment before investing in any nonadvanced grid technologies would lead to inefficiencies and produce no benefits.

9. Requiring SCE, SDG&E and PG&E to demonstrative that they have considered a Smart Grid investment before investing in any nonadvanced grid technologies would lead to inefficiencies and higher costs.

10. Requiring a utility to demonstrate that it has considered a Smart Grid investment before investing in a nonadvanced grid technology in the case of each and every one of the thousand of grid components the utilities invest in each year would be burdensome and contrary to cost-effective regulatory practices, and would delay needed grid investments.

11. Since current Commission policy offers utilities a reasonable return on investments, adopting a similar standard for Smart Grid investments offers no change in policy and could result in confusion concerning what investments "qualify" as a Smart Grid investment.

12. The record in this proceeding provides no basis for offering an earnings premium for investments in a Smart Grid.

13. The Commission's practice of considering policies pertaining to the recovery of the costs associated with stranded assets at the time that the Commission considers the new investments, such as in a General Rate Case or application, is reasonable and will be workable for Smart Grid investments.

14. At this time, it is not clear that Smart Grid investments will lead to stranded assets.

15. The Commission has not adopted any requirements concerning the communication of prices in either real-time or near real-time.

16. The current block pricing of electricity makes it difficult for a residential customer to know the price that the customer pays at a particular time.

17. Sierra Pacific, Mountain Utilities, PacifiCorp and Bear Valley Electric have not installed advanced meters in California at this time.

18. The small size of Sierra Pacific, Mountain Utilities, PacifiCorp and Bear Valley Electric operations in California would make the cost of installing advanced meters to meet the information disclosure standards proposed by EISA overly burdensome at this time.

19. To realize the benefits of AMI, customers and authorized third parties need access to the information provided by the meters on a real-time or near real-time basis.

20. To realize the benefits of AMI, customers and authorized third parties need access to pricing information on a real-time or near real-time basis.

21. To realize the benefits of AMI for customers who choose not to or are unable to invest in a HAN device, customers and authorized third parties need access data collected by the utilities, including price and usage data, via the Internet.

1. CFC does not identify a factual dispute that would warrant evidentiary hearings

2. EISA requires that this Commission consider three requirements concerning Smart Grid investments and two requirements concerning Smart Grid information for each electric utility subject to Commission regulation.

3. A purpose of PURPA is to produce equitable rates for consumers.

4. A purpose of PURPA is to produce the efficient use of facilities and resources by electric utilities.

5. Since a requirement to demonstrate that a utility has considered a Smart Grid investment before investing in any nonadvanced grid technologies would increase costs without producing benefits, it would lead to higher rates and is therefore inconsistent with producing equitable rates for consumers, which is a purpose of PURPA.

6. Since a requirement to demonstrate that a utility has considered a Smart Grid investment before investing in any nonadvanced grid technologies would impose a regulatory hurdle that would slow infrastructure investment and modernization, it is inconsistent with the efficient use of facilities and resources by electric utilities, which is a purpose of PURPA.

7. Under the provisions of § 8362 of the Pub. Util. Code, the Commission must determine the requirements for a Smart Grid deployment plan and guide utility investments.

8. Adopting policies to guide Smart Grid deployment is reasonable and consistent with the purposes of EISA.

9. There is no significant difference between Commission ratemaking procedures, which offer IOUs a reasonable return on investments, and the requirement proposed in EISA that would adopt as a regulatory standard "authorizing each utility to recover from ratepayers any capital, operating expenditure, or other costs of the electric utility relating to the deployment of a qualified Smart Grid."

10. Since adopting a requirement that authorizes each utility to recover from ratepayers any capital, operating expenditure, or other costs of the electric utility relating to the deployment of a qualified Smart Grid risks regulatory confusion while yielding no change in policy, it is inconsistent with the efficient use of facilities and resources by electric utilities, which is a purpose of PURPA.

11. Adopting a requirement that authorizes any electric utility that deploys a Smart Grid to recover in a timely manner the remaining book-value costs of any equipment rendered obsolete based on the remaining depreciable life of the obsolete equipment is inconsistent with the purposes of the act because creating a special policy for these investments when none is needed may cause regulatory confusion and delay.

12. Requiring Sierra Pacific, Mountain Utilities, PacifiCorp and Bear Valley Electric to provide customers with access to the information referenced in 16 U.S.C. § 1621(d)(19)(B) in written and electronic form is inconsistent with producing equitable rates for consumers, which is a purpose of PURPA, because the costs would be overly burdensome to these utilities at this time.

13. Requiring SCE, SDG&E and PG&E to provide customers with access to the information referenced in 16 U.S.C. § 1621(d)(19)(B) is not necessary because prior Commission actions on implementing information disclosure policies in the context of the utilities' advanced metering initiatives constitute a "prior state action" pursuant to 16 U.S.C. § 1621(d), and make further action unnecessary to fulfill EISA requirements.

14. It is reasonable to initiate workshops to identify low cost or no cost methods to meet the EISA standard of providing real-time or near real-time information via a HAN and backhaul data via the internet on customer usage and the price/cost of electricity charged to customers, to consider whether to adopt NIST standards for all customers that have meters, and to consider how utilities can recover the costs, if any, of providing customers and authorized third parties with access to price and usage information. In addition, it is reasonable to consider in these workshops whether to provide customers with access to their cumulative monthly usage, relative to baseline allocations and their cumulative monthly bill.

15. Requiring Sierra Pacific, Mountain Utilities, PacifiCorp and Bear Valley Electric to provide their customers with access to usage information at any time through the Internet and on other means of communications elected by the utility and to provide other interested persons with access to certain information not specific to any one purchaser via the internet is inconsistent with producing equitable rates for consumers, which is a purpose of PURPA, because the costs would be overly burdensome to these utilities at this time.

16. Requiring SCE, SDG&E and PG&E to provide their customers with access to usage information at any time through the Internet and on other means of communications elected by the utility and to provide other interested persons with access to certain information not specific to any one purchaser via the internet is not necessary because prior Commission actions on implementing information disclosure policies in the context of the utilities' advanced metering initiatives constitute a "prior state action" pursuant to 16 U.S.C. § 1621(d), and make further action unnecessary to fulfill EISA requirements.

17. It is reasonable to set a deadline by which SCE, SDG&E, and PG&E must be capable of providing an authorized third party with access to the customer's usage information that is collected by the utility by the end of 2010 should the customer desire that information.

18. It is reasonable to require that SCE, SDG&E, and PG&E be capable of providing a customer possessing an AMI meter with access to the customer's usage information on a near real-time basis by the end of 2011.

19. It is reasonable to require that access to usage data be consistent with rules developed in this proceeding pursuant to EISA, the general public interest, and state privacy rules.

20. It is reasonable for the Commission to consider requiring the three major IOUs to fully comply with Smart Grid standards recommended by NIST in this proceeding.

ORDER

IT IS ORDERED that:

1. Tendril Networks' Motion to Become a Party to this proceeding is granted.

2. North American Power Partners' Motion to Become a Party to this proceeding is granted.

3. Southern California Edison Company, San Diego Gas & Electric Company, and Pacific Gas and Electric Company shall provide an authorized third party with access to the customer's usage information that is collected by the utility by the end of 2010 should the customer desire that information. This access shall be consistent with the rules developed pursuant to Ordering Paragraph 5 below.

4. Southern California Edison Company, San Diego Gas & Electric Company and Pacific Gas and Electric Company shall provide to their customers with a smart meter access to usage data on a real-time or near real-time basis no later than the end of 2011, consistent with the rules developed pursuant to Ordering Paragraph 5 below.

5. The next phase of this proceeding shall consider rules to provide customers and third parties with access to usage and price data consistent with Energy Information and Security Act of 2007 standards, the general public interest, and state privacy rules.

6. The participation in the next phase of this proceeding by the utilities PacifiCorp, Sierra Pacific, Mountain Utilities, and Bear Valley shall be limited to issues raised by Senate Bill 17 (Chapter 327, Statutes of 2009) unless a utility files a motion in this proceeding requesting full participation within 30 days of the adoption of this decision. Alternatively, each of these utilities may file a motion asking for dismissal from this proceeding. The assigned Commissioner or assigned Administrative Law Judge may grant such a motion via a ruling provided that the utility meets the conditions set forth in Senate Bill 17 for exemption from its requirements.

This order is effective today.

Dated December 17, 2008, at San Francisco, California.

I reserve the right to file a concurrence.

/s/ DIAN M. GRUENEICH

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