3. Application for Blythe
SCE filed an application on February 28, 2007, seeking the following findings:
¬ That SCE's conduct in respect to the fast-track RFO was reasonable; and
¬ That the Blythe PPA is needed to preserve system reliability; that the contract is reasonable and prudent; that the Blythe payments are recoverable in full through rates or other Commission authorized cost recovery mechanism, subject only to SCE's prudent administration of the contract; and that SCE is to allocate the costs and benefits of the Blythe contract to all benefiting customers in accordance with D.06-07-029.
A prehearing conference was held on March 27, 2007. On April 2, 2007, the Division of Ratepayer Advocates (DRA) was the only party that filed a protest. Based on the limited issues raised in the protest, one day of evidentiary hearing (EH) was scheduled for May 30, 2007.
DRA served intervenor testimony, as did Californians for Renewable Energy (CARE). CARE, DRA and SCE participated in the EH; CARE, DRA and SCE filed post-hearing opening briefs; and DRA and SCE filed reply briefs.
CARE requested an opportunity for the citizens of Blythe, California to share their views on the power plant with the Commission. A public participation hearing (PPH) was held on July 12, 2007, in Blythe and numerous Blythe and Mesa Verde residents attended and participated.
3.1. Intervenors
DRA
DRA consistently has argued that the energy from the CPV PPA is not needed until 2011, and therefore the Commission should not approve the contract with an on-line date of August 1, 2010. DRA alleges that if the start date of the resource can be postponed until 2011, ratepayers will save millions of dollars. In summary, DRA does not address whether or not the Blythe PPA is an appropriate choice from the RFO, but only whether the resource is needed in 2010 when it is scheduled to come on-line.
DRA argues that the Commission's directive in D.06-07-029 to SCE to solicit up to 1,500 MW of new generation was not a pre-approval of SCE's need for more resources. SCE still has to justify its need numbers going forward, and DRA claims SCE did not meet that burden. To begin, DRA argues that SCE presented "no fewer than four (4) sets of projected need numbers between the time of the filing of the Application [February 28, 2007] and the time of this brief [June 20, 2007]."7 From DRA's perspective, the use of different forecast numbers by SCE makes it difficult for anyone to do a thoughtful analysis of what SCE's need actually is at any particular point in time. DRA argues that the different need tables are not easily comparable because they use varying imputs for planning reserves and operating reserves, as well as present need numbers assuming a "worst-case scenario." In some tables, the projected retirement numbers are different, and in other tables SCE reduces its forecast for demand response programs to comport with updated information. DRA cross-examined SCE's witness Minick on the differing forecast numbers, and Minick suggested "split the difference."8
DRA recommends that SCE use the more substantiated California Energy Commission (CEC) forecast for demand beyond 2007, that indicates a demand of 28,511 MW total for SP 15, instead of SCE's own forecast that shows a need of 29,062 MW. DRA argues that SCE should not rely on its own forecast when that forecast is so significantly different from the CEC forecast, and SCE failed to present adequate justification for the difference. When DRA develops its own forecast for SP 15, using the CEC forecast, DRA finds that "SCE posts a robust 2,073 MW of excess capacity in 2010."9
Therefore, based on this forecast, DRA urges the Commission to deny the application for the Blythe resource because ratepayers will save many millions of dollars if the PPA is delayed until SCE actually has a need for the resource.
CARE
CARE also questions whether the energy from Blythe is needed. From CARE's analysis of SCE's data, CARE claims that SCE fails to present any empirical basis for its assumptions about plant retirements, and therefore CARE argues that SCE has no evidentiary record to support building new facilities. CARE's primary concern, however, is whether the Blythe facility's production of greenhouse gas emissions has been adequately considered and addressed. CARE requested, and received, the PPH in Blythe so that CARE's membership in the Blythe area would have an opportunity to address the Commission on the total environmental impacts they think will result from utilizing the Blythe facility, including the loss of agriculture lands.
7 DRA Opening Brief, June 20, 2007, p. 5.
8 Id., p. 6, citing RT, p. 53.
9 Id., p. 10.
