6. Preliminary Scoping Memo

In this Preliminary Scoping Memo, we describe the issues to be considered in this proceeding and the timetable for resolving the proceeding. Appendix A (Preliminary Scoping Memo) provides further guidance on each of the issue areas identified in this section.

As previously stated, the focus of this LTPP cycle is to consider various refinements to the policies, practices and procedures underlying the LTPPs themselves. We bifurcate this proceeding to deal with issue areas in two phases. Phase I will address issues that must be decided prior to the filing of the next round of LTPPs. Phase II will consider issues that are either (1) not time sensitive or (2) will not impact the structure or content of the next set of LTPPs, but for which decisions will be needed prior to the design of any long-term requests for offers (RFOs) initiated pursuant to our approval of the next set of LTPPs.

Among the issues not considered in other procurement-related dockets (provided in Table 1) are several important issues that we will consider in this rulemaking. The primary sources of guidance on these issues are D.07-12-052 (and the R.06-02-013 record), the 2007 IEPR, and ongoing experience implementing the LTPP program. Accordingly, the Commission considers the following issues to be within the scope of in this proceeding:

Phase I:

· Standardized resource planning practices, assumptions and analytic techniques applied in long-term procurement plans, based on an integrated resource planning framework;

· Interim standards and practices to evaluate the uncertain cost of future GHG regulations during AB 32 implementation and in anticipation of possible federal legislation;

· Preparation of a report which provides specific information on each of the relevant programs either under the Commission's purview or funded by utility ratepayers that contribute to a reduction in GHG;¹⁵

· A methodology to quantify EE in the CEC load forecast;

· Methodologies to estimate firm capacity from demand-side resources for long-term planning and procurement purposes;

· Customer risk preference study; and

· Other identified LTPP program implementation issues.

Phase II:

· Consider whether and to what extent refinements to policies distinguishing system versus bundled resource needs, including a methodology that allocates the cost of new generation to system and bundled customers; and

· Evaluation of whether and how refinements can be made to the bid evaluation process to ensure fair competition between power purchase agreements and utility-owned generation bids, and alternatives to the competitive market approach where competition cannot be used to reach equitable and efficient outcomes.

We invite parties to comment on the issues we propose for development in this OIR and following receipt of comments and the Prehearing Conference (PHC)/Workshop, the assigned Commissioner will add any additional issues that should properly be within the scope of this proceeding.

¹⁵ On December 11, 2007, California Large Energy Consumers Association, The Utility Reform Network, Energy Producers and Users Coalition/Indicated Producers/Western States Petroleum Association and California Manufacturers & Technology Association (Joint Parties) filed a Motion for an Inventory of all Utility Ratepayer Funded Programs and all GHG Reduction Programs for the Electricity and Natural Gas Sectors. The motion was filed in R.07-09-008, R.06-04-009, and A.07-08-031. In response to the Motion, the Commission is directing parties in this 2008 OIR, the umbrella proceeding for procurement related issues, to produce such an inventory. Directives for compilation of the inventory are set forth in Appendix A, A.B., Phase I, Interim GHG Uncertainty Assessment.