2. Procedural Background
The RPS program was initiated by Senate Bill (SB) 1078 (Sher), Stats. 2002 ch. 516.1 In Decision (D.) 03-06-071, our order beginning RPS implementation, we focused on setting procedures for the three large investor-owned utilities (IOUs)2 to begin RPS procurement as soon as possible. We continued our implementation with decisions of general applicability, such as D.04-06-014, which set standard terms and conditions for RPS procurement contracts, and D.04-06-015, which set the initial market price referent (MPR).
Our consideration of the place of small utilities3 and multi-jurisdictional utilities4 (collectively, SMJUs) in the RPS program has had three iterations. We appreciate the patience and persistence of the SMJUs in responding to various changes over the extended period of time involved. In this decision, we consider the parties' submissions that are most relevant to the current state of the governing law and the administration of the RPS program.
In D.05-11-025, issued in Rulemaking (R.) 04-04-026, the predecessor to this proceeding, we found that all RPS-obligated load-serving entities (LSEs), including SMJUs, energy service providers (ESPs), and community choice aggregators (CCAs), are required to meet the five basic elements of the RPS program.5 We also noted that then-recently enacted Assembly Bill 200 (Leslie), Stats. 2005, ch. 50, codified at § 399.17, would provide more detailed direction on some aspects of the RPS participation of multi-jurisdictional utilities.
The second iteration followed our request in D.05-11-025 for parties to submit proposals for participating in the RPS program that met the basic requirements, but might have elements that were specific to the type of LSE. SMJUs (and other LSEs) submitted proposals, and parties commented extensively on them.6
After the parties completed these submissions, SB 107 made significant changes to the RPS program. Some revisions impacted the RPS program as a whole. The repeal of former § 399.14(a)(1), which had deferred the RPS procurement performance of utilities that were not creditworthy, directly impacted MU and Sierra.
The third iteration of consideration of SMJUs then followed. In the ALJ's Ruling Setting Schedule for Revised Proposals for Participation in the RPS Program (Oct. 13, 2006), the ALJ asked for revised proposals in light of the repeal of former § 399.14(a)(1). MU and Sierra filed and served their revised proposals, on which Friends of Kirkwood commented, in November 2006.
With the extensive contributions of the parties outlined above, we now turn to the RPS compliance issues of SMJUs in the context of a mature RPS program.
1 The statutory provisions are found at Pub. Util. Code §§ 399.11-399.20. All subsequent references to sections are to the Public Utilities Code, unless otherwise specified.
2 Pacific Gas and Electric Company (PG&E); San Diego Gas & Electric Company (SDG&E); and Southern California Edison Company (SCE).
3 Currently, respondents Bear Valley Electric Service (BVES), a division of Golden State Water Company (GSWC), and Mountain Utilities (MU) are the only utilities in this group.
4 Currently, respondents PacifiCorp and Sierra Pacific Power Company (Sierra) are the only utilities in this group.
5 These are:
● Meeting the goal that 20% of retail sales will come from eligible renewable resources by the end of 2017 [SB 107 (Simitian), Stats. 2006, ch. 464, advanced this date to 2010. See § 399.11(a).];
● Increasing annual renewable electricity procurement by 1% of the prior year's retail sales;
● Reporting to the Commission on progress toward meeting RPS requirements;
● Utilizing the flexible compliance mechanisms developed by the Commission; and
● Being subject to uniform penalty procedures and potential penalties.
6 MU, PacifiCorp, and Sierra filed their proposals in R.04-04-026 in February 2006. After R.06-02-012 was opened, Aglet Consumer Alliance (Aglet), PG&E, the Division of Ratepayer Advocates, SCE, The Utility Reform Network (TURN) and Union of Concerned Scientists(UCS) (jointly), as well as MU, PacifiCorp, and Sierra filed comments and/or reply comments in this proceeding. Friends of Kirkwood Association was allowed to intervene and file comments by the Administrative Law Judge's (ALJ) Ruling Granting Motion to Intervene (March 20, 2006).
More detailed supplemental proposals were filed by PacifiCorp, Sierra, and MU in May 2006. SCE and Friends of Kirkwood filed comments on them in June 2006. After consultation with the assigned ALJ, BVES filed its Revised Proposal for Participation in March 2007.
