4. Comments on Proposed Decision

The proposed decision of the ALJ in this matter was mailed to the parties in accordance with Section 311 of the Public Utilities Code and comments were allowed under Rule 14.3 of the Commission's Rules of Practice and Procedure. Comments were filed on June 13, 2011. Reply Comments were filed on June 20, 2011.

Based upon comments to the proposed decision, the following modifications have been made:

· Clarify language concerning penalties for RA program violations, generally as suggested by DRA. The time period for increased penalties for repeat violations is now consistently a "compliance year";

· Modification of Finding of Fact 32, related to the DR resources, suggested by PG&E;

· Addition of language related to the replacement rule, seeking further quantification of costs incurred by the CAISO and LSEs;

· Denial of SCE's request made in comments to the Proposed Decision to provide it with an exemption for RA treatment of two DR programs;

· Clarification of DR program totals allocated toward RA credit, consistent with the Settlement in D.10-06-034; and

· The LSE replacement rule is maintained for the 2012 RA compliance year.