VI. Assignment of Proceeding
Dian M. Grueneich is the Assigned Commissioner and Julie M. Halligan is the assigned ALJ in this proceeding.
1. The provisions of § 399.25 apply to applications for transmission line construction subject to the Commission's siting jurisdiction, either network or gen-tie, that are deemed necessary to facilitate the achievement of the RPS goals.
2. A finding of "network benefits" pursuant to § 399.25(b)(1) is not a prerequisite for backstop cost recovery under § 399.25(b)(4); the two provisions of[n] the code function independently of one another.
3. High voltage, bulk-transfer transmission facilities, whether classified as network or gen-tie, that are designed to serve multiple RPS-eligible generators where it has been established that the amount of added transmission capacity will likely be utilized by RPS-eligible generation projects within a reasonable period of time are eligible for § 399.25 cost recovery.
4. New network transmission facilities needed to interconnect an RPS-eligible resource whose developer has entered into a Commission-approved power purchase agreement are eligible for § 399.25 cost recovery.
5. The utilities may file an application for transmission facilities that do not require a Certificate of Public Convenience and Necessity (CPCN) or Permit to Construct (PTC) from the Commission. Any such application must contain a showing that the facilities are necessary to meet the RPS goals and must demonstrate that the normal method for cost recovery of similar transmission facilities constructed under the normal course of utility business (i.e., recovery through FERC transmission rates) is not available to the proposed facilities.
6. Section 399.25 can be applied to new transmission facilities resulting from either new renewable generation projects or repowered or expanded renewable generations projects, if the transmission facilities meet the criteria set forth in this Decision.
7. Nothing in this decision is intended to relieve renewable generators from their responsibility for their fair share of the costs of non-network transmission facilities necessary to interconnect the generator with the network.
8. A finding of eligibility for cost recovery is a necessary, though not sufficient, condition for cost recovery through retail rates under Section 399.25.
9. To protect ratepayers from the risk associated with unnecessary facilities, we do not anticipate finding gen-tie facilities to be necessary to facilitate the achievements of the RPS goals absent at least one approved RPS contract.
10. The utilities are authorized to file an Advice Letter seeking approval to record and recover certain study and project development costs prior to the filing of an application for Section 399.25 cost recovery for identified transmission facilities that fall into the first category of eligible facilities set forth in this decision.
11. Advice Letters filed pursuant to Finding of Fact 10, above, shall clearly identify the environmental, engineering, and permitting studies necessary to the determination of project viability, as well as the estimated cost of those studies. Any such Advice Letters shall also clearly demonstrate that the facilities to be studied are needed to meet the RPS goals.
12. In addition to filing an application for Section 399.25 cost recovery from the Commission for transmission facilities necessary to facilitate the RPS goals, utilities shall also seek authorization from the Federal Energy Regulatory Commission (FERC) to recover the costs associated with the subject transmission facilities through general transmission rates. The utilities may proceed concurrently with the applications at the Commission and FERC.
13. Costs associated with renewable transmission facilities to be recovered from retail ratepayers pursuant to §399.25 should not be recovered through distribution rates.
1. The Commission's ability to authorize retail rate recovery of transmission upgrade costs pursuant to § 399.25(b)(4) does not interfere with the FERC's jurisdiction over transmission ratemaking such that it would be preempted by federal law.
2. The relief allowed under Section 399.25 is limited to transmission facilities proposed by Commission-jurisdictional utilities.
3. The Commission does not have the authority to require transmission owners to provide up-front funding for transmission upgrades, but may provide cost recovery in retail rates under § 399.25 to mitigate the cost recovery risk for such up-front funding.
4. In order to proceed as expeditiously as possible with the implementation of § 399.25, this decision should be effective today.
IT IS ORDERED that:
1. The provisions of Section 399.25 apply to transmission facilities that come before the Commission through an application for a Certificate of Public Convenience and Necessity, a Permit to Construct, or an application for determination of § 399.25 eligibility and that are deemed necessary to facilitate the Renewables Portfolio Standard (RPS) goals through that process.
2. The provisions of § 399.25 apply to both "network" transmission facilities and high-voltage generation-tie (gen-tie) transmission facilities that are deemed necessary to facilitate the achievement of the RPS goals.
3. Transmission facilities that meet one of the following criteria are eligible for Section 399.25 cost recovery: (1) new high, voltage, bulk-transfer, transmission facilities, whether classified as network or gen-tie, that are designed to serve multiple RPS-eligible generators where the amount of added transmission capacity will likely be utilized by RPS-eligible generation projects to meet the state-mandated RPS goal, or (2) network transmission facilities that are required to connect an RPS-eligible resource that is necessary for the achievement of RPS goals and that has an approved power purchase contract.
4. The utilities are authorized to file advice letters for approval of pre-application study costs as set forth in this Decision.
This order is effective today.
Dated June 15, 2006, at San Francisco, California.
MICHAEL R. PEEVEY
President
GEOFFREY F. BROWN
DIAN M. GRUENEICH
JOHN A. BOHN
RACHELLE B. CHONG
Commissioners
ATTACHMENT 1
LIST OF ACRONYMS AND ABBREVIATIONS
AB - Assembly Bill
ACR - Assigned Commissioner's Ruling
ALJ - Administrative Law Judge
ATPMA - Antelope Transmission Projects Memorandum Account
BRRBA - Base Revenue Requirement Balancing Account
CAISO - California Independent System Operator
CalWEA - California Wind Energy Association
CEC - California Energy Commission
CEERT - Center for Energy Efficiency and Renewable Technologies
CEQA - California Environmental Quality Act
CPCN - Certificate of Public Convenience and Necessity
ERRA - Energy Resource Recovery Account
FERC - Federal Energy Regulatory Commission
GO - General Order
I. - Investigation
IEP - Independent Energy Producers Association
IOU - Investor-Owned Utility
kV - Kilovolt
OII - Order Instituting Investigation
PG&E - Pacific Gas and Electric Company
PTC - Permit to Construct
R - Rulemaking
RPS - Renewable Portfolio Standard
SB - Senate Bill
SDG&E - San Diego Gas & Electric Company
SCE - Southern California Edison Company
Stirling - Stirling Energy Systems, Inc.
TAC - Transmission Access Charge
TRR - Transmission Revenue Requirement
TURN - The Utility Reform Network
Vulcan - Vulcan Power Company
(END OF ATTACHMENT 1)
