II. Procedural Background
On June 19, 2003, we issued D.03-06-071, which provided guidance on a range of RPS issues, including development of an MPR methodology.1 On June 9, 2004, we issued D.04-06-015, which adopted a cash-flow simulation methodology to calculate MPRs, and determined that MPRs will be publicly disclosed to all parties simultaneously, after utilities' RPS solicitations have closed, but before advice letters requesting contract approval are filed. On July 8, 2004, we issued D.04-07-029, which described the RPS solicitation - contract approval schedule, including the process for calculating and releasing the MPR; detailed how the MPR would be used in the bid evaluation process; and outlined the California Energy Commission's (Energy Commission) Supplemental Energy Payment (SEP) process.
Pursuant to D.04-06-015, an Assigned Commissioner's Ruling (ACR) and associated staff report was issued on February 4, 2005, which publicly disclosed the 2004 MPRs.2 Parties filed comments and reply comments. After staff review of the comments, we adopted Resolution E-3942 on July 21, 2005, which disclosed the final 2004 MPR values for baseload and peaking proxy plants.
A prehearing conference (PHC) was held May 18, 2005, to address issues related to the calculation and adoption of the 2005 MPR, including modifications to the existing 2004 MPR methodology; a methodology for applying Time of Delivery (TOD) profiles to the 2005 MPR; and gas and non-gas inputs for the 2005 MPR. Based on the consensus reached at the PHC, an Administrative Law Judge's (ALJ) Ruling dated May 24, 2005, asked the parties to file separate pre-workshop comments for two proposed MPR workshops: one covering gas and non-gas inputs, gas forecast modeling, and the cash flow model adopted for the 2004 MPR; and one covering TOD profiles.3 The gas/non-gas workshop and TOD workshop were held on June 20-21, 2005 and June 27-28, 2005, respectively.
After these workshops, an ALJ Ruling dated July 7, 2005 asked parties to file post-workshop comments to address a series of questions regarding gas/non-gas inputs, 2005 MPR methodology, and the MPR TOD methodology. Parties filed comments on August 5, 20054 and reply comments on August 16, 20055. In addition to extensive comments filed by the parties, a number of documents were circulated to the parties and presentations were made at the workshops and in subsequent working group meetings by parties, by staff, and by Energy and Environmental Economics, Inc. (E3),6 consultants to staff.
1 This was in compliance with the Legislature's instruction in Pub. Util. Code ยง 399.14(a)(2)(A) that certain methods and processes for the RPS program be adopted within six months of the January 1, 2003 effective date of the RPS legislation, Senate Bill (SB) 1078 (Sher). All subsequent references to sections are to the Public Utilities Code unless otherwise specified.
2 On February 7, 2004, it came to staff's attention that there had been a technical error in the MPR calculation. The technical error was corrected and the revised 2004 MPRs and staff report were reissued in an ACR on February 11, 2004.
3 Pre-workshop comments were filed on June 10, 2005, by the California Cogeneration Council, California Wind Energy Association (CalWEA), and California Biomass Energy Alliance jointly (CalWEA group); Green Power Institute (Green Power); Pacific Gas and Electric Company (PG&E); Southern California Edison Company ( SCE); San Diego Gas & Electric Company (SDG&E); Solargenix; and Union of Concerned Scientists (UCS).
4 Comments were filed by jointly by CalWEA group; Green Power; Office of Ratepayer Advocates (ORA); PG&E; SDG&E; SCE; Solargenix; The Utility Reform Network (TURN), and UCS.
5 Reply comments were filed by the CalWEA group, Green Power, ORA, PG&E, SDG&E, SCE, and TURN.
6 Information about E3 may be found at its web site, http://www.ethree.com.
