ALJ/AES/oma Date of Issuance 1/14/2011

Decision 11-01-026 January 13, 2011

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Order Instituting Rulemaking to Continue Implementation and Administration of California Renewables Portfolio Standard Program.

Rulemaking 08-08-009 (Filed August 21, 2008)

DECISION REVISING RULES FOR THE RENEWABLES PORTFOLIO STANDARD PURSUANT TO SENATE BILL 695

DECISION REVISING RULES FOR THE RENEWABLES PORTFOLIO STANDARD PURSUANT TO SENATE BILL 695 1

1. Summary 2

2. Procedural Background 3

3. Discussion 5

3.1. Previous Commission Decisions 5

3.2. Statutory Framework 8

3.3. Review of RPS Program Features 11

3.3.1. Parties' Proposals 11

3.3.2. RPS Procurement Plans 12

3.3.3. Limits on TRECs 16

3.3.3.1. Temporary Limit on TRECs Usage 16

3.3.3.2. Temporary Limit on IOU Payments for TRECs 18

3.3.4. Reporting and Compliance 19

3.3.5. RPS Contracts and the Contracting Process 20

3.3.6. Tariffs and Standard Contracts for Small Generators 24

3.3.7. Next Steps 25

4. Comments on Proposed Decision 25

5. Assignment of Proceeding 27

Findings of Fact 27

Conclusions of Law 27

ORDER 28

DECISION REVISING RULES FOR THE RENEWABLES PORTFOLIO STANDARD PURSUANT TO SENATE BILL 695

1. Summary

This decision implements new Pub. Util. Code § 365.1, which requires among other things that, once the Commission has begun the process of reopening direct access transactions, the Commission must ensure that electric service providers (ESPs) are subject to the same requirements of the renewables portfolio standard (RPS) program as are the three large investor-owned utilities (IOUs).

Section 365.1 expressly exempts community choice aggregators (CCAs) from its requirements and does not address small and multi-jurisdictional utilities (SMJUs). Consequently, this decision does not address RPS program requirements as they apply to CCAs or SMJUs.

This decision reviews RPS program requirements for ESPs and the three large IOUs and concludes that almost all significant RPS requirements currently apply equally to large IOUs and ESPs. The decision adds to the RPS obligations of ESPs the filing of RPS procurement plans for Commission approval, in compliance with instructions from the assigned Commissioner or assigned Administrative Law Judge in this proceeding or its successor. This decision also concludes that any limit on the use of tradable renewable energy credits (TRECs) for RPS compliance that applies to the large IOUs applies to ESPs. Any limit on the price an IOU may pay for TRECs, however, applies only to IOUs.