ALJ/TRP/jt2 Date of Issuance 2/24/2012
Decision 12-02-024 February 16, 2012
BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA
Application of Stanford University for Modification of Decision 03-04-030. |
Application 11-10-021 (Filed October 18, 2011) |
DECISION REGARDING APPLICATION FOR MODIFICATION
1. Introduction
This decision resolves the Application of Stanford University (Stanford) for Modification of Decision (D.) 03-04-030 in the manner outlined below. In D.03-04-030, the Commission adopted policies and mechanisms related to cost responsibility surcharges (CRS) applicable to Departing Load served by Customer Generation within the service territories of California's major electric utilities.1
In D.03-04-030, the Commission created a categorical exemption from CRS for departing load that began to receive service from customer generation on or before February 1, 2001 (with respect to Department of Water Resources (DWR)-related components of the CRS). This exemption was consistent with the Commission's policy of maintaining bundled customer indifference, thereby ensuring that an investor-owned utility's bundled customers will not be better or worse off as a result of a customer switching to self-generation.
The Commission, however, did not explicitly address in D.03-04-030 the situation in which exempt or grandfathered customer generation load2 switches to direct access (DA).
Stanford therefore seeks modification of D.03-04-030 to clarify that customers who switch self-generation load that is exempt from CRS to DA service are only obligated to pay DA-CRS based on the amount of total annual power consumption (calculated by reference to historical usage) previously provided by the investor-owned utilities, for example under stand-by service.
Stanford argues that its situation justifies a modification of D.03-04-030 and related tariff schedules. Since 1987, Stanford load for its main campus has been served by on-site generation. A gas-fired cogeneration plant on the Stanford campus has served the campus' full electric and thermal energy loads. PG&E supplied backup power under Schedule S. Pursuant to the Commission's rules implementing the limited re-opening of DA for non-residential customers, Stanford became a DA customer within PG&E's service territory on March 2011. Stanford thus switched service for the portion of its campus load not served by on-site generation from PG&E to an Electric Service Provider. Stanford is also now in the process of reducing self-generation and substituting DA service for that reduced self-generation.
Stanford has no objection to paying CRS charges reflecting the California DWR obligations on the quantity of electricity previously used to provide the campus load with stand-by service. Stanford argues, however, that it should not have any obligation to pay any additional CRS charges because the balance of its power has been provided by on-site generation, not PG&E or DWR. In order to clarify its cost responsibility in this regard, Stanford seeks modification of D.03-04-030.
This issue may also arise for other customers seeking to fully or partially replace their previously existing or grandfathered self-generation with DA service. Based on review of the underlying facts and arguments presented, as discussed below, we find merit in Stanford's request to be relieved of the obligation to pay additional CRS for the balance of its power that was previously supplied through its on-site customer generation, and that was not previously supplied by PG&E on a stand-by basis. For reasons explained below, however, we address Stanford's concern by granting Stanford a limited deviation from the terms of the PG&E tariff, rather than by adopting any modifications to D.03-04-030 or requiring amendments to the PG&E tariff.3
1 Departing Load, as defined in D.03-04-030, refers to the portion of a utility customer's electric load for which the customer: (a) discontinues or reduces purchase of bundled or direct access service; (b) purchases or consumes electricity supplied and delivered by customer generation to replace the utility or direct access purchases; and (c) remains physically located within the utility's service territory. Customer Generation refers to cogeneration, renewable technologies, or any other type of generation (a) dedicated wholly or in part to serve a specific customer's load; and (b) relying on non-utility or dedicated utility distribution wires, rather than the utility grid, to serve the customer, the customer's affiliates and/or tenants, and/or not more than two other persons or corporations.
2 As described in D.03-04-030 at 11-12, "grandfathered" customer generation refers to customer generation departing load served by new onsite or over-the-fence generation up to a prescribed annual new cap that is exempt from a surcharge for DWR-related costs. "Exempt" customer generation simply refers to customer generation that does not have to pay CRS for any reason.
3 PG&E's tariff schedule DA-CRS identifies the following CRS elements:
Energy Cost Recovery Amount, Ongoing Competition Transition Charges, California Department of Water Resources (DWR) Bond Charge, and the Power Charge Indifference Adjustment (PCIA), as set forth in each rate schedule.
The PCIA is calculated annually and is vintaged by calendar year in PG&E's annual Energy Resource Recovery Account proceeding based on the year the load departed. As adopted in D.06-07-030, the PCIA instituted a bottoms-up calculation of ratepayer indifference, to replace the previous tops-down calculation of DWR power charges.
Pursuant to D.08-09-012 and D.06-07-029, PG&E may apply for a collect a "New Generation" charge as part of the DA-CRS.
