COM/MP1/lil Date of Issuance 4/14/2010

Decision 10-04-028 April 8, 2010

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Application of Pacific Gas and Electric Company for Approval and Recovery of Costs Associated with its Fuel Cell Project.	Application 09-02-013 (Filed February 20, 2009)
Application of Southern California Edison Company for Authority to Implement and Recover in Rates the Cost of its Proposed Fuel Cell Installation Program for State Universities.	Application 09-04-018 (Filed April 27, 2009)

DECISION AUTHORIZING FUEL CELL PROJECTS

1. Summary

This decision approves, with modifications, the applications of Pacific Gas and Electric Company (PG&E) and Southern California Edison Company (SCE) for approval of each utility's Fuel Cell Project to install utility-owned fuel cells on several University of California and California State University campuses. The decision finds it reasonable for the utilities to proceed with their respective Fuel Cell Projects, as long as the projects are modified in two respects. First, PG&E and SCE shall each reduce their project capital costs to reflect a lower contingency percentage. Second, PG&E shall remove contingency costs and education and outreach labor costs from its estimated non-fuel operations and maintenance costs.

In response to protests to the applications, the decision finds the following: 1) the applications comply with Commission guidance for competitive solicitation of utility-owned generation, as set forth in Decision 07-12-052; 2) the decision rejects SCE's suggested treatment of its Fuel Cell Project stranded costs; and 3) the decision denies SCE's request to use excess Self-Generation Incentive Program funds to pay for half the capital costs for its Fuel Cell Project.