4. Substantial Contribution

In evaluating whether a customer made a substantial contribution to a proceeding, the Commission looks at several things. First, we look at whether the Commission adopted one or more of the factual contentions, legal contentions, or specific policy or procedural recommendations that the customer advanced. (§ 1802(i).) Second, if the customer's contentions or recommendations paralleled those of another party, we look at whether the customer's participation unnecessarily duplicated or materially supplemented, complemented, or contributed to the presentation of the other party. (§§ 1801.3(f) and 1802.5.)

The assessment of whether the customer made a substantial contribution requires the exercise of judgment. (§ 1802(i).)

In assessing whether the customer meets this standard, the Commission typically reviews the record, composed in part of pleadings of the customer and, in litigated matters, the hearing transcripts, and compares it to the findings, conclusions, and orders in the decision to which the customer asserts it contributed. It is then a matter of judgment as to whether the customer's presentation substantially assisted the Commission.³

With this guidance in mind, the Commission turns to TURN's claimed contributions to the proceeding.

4.1. Contributions to D.06-07-029

TURN was a proponent of the "Joint Parties" proposal for the cost-allocation mechanism that the Commission adopted in modified form in D.06-07-029.⁴ TURN advocated for such a policy beginning with its December 12, 2005 pre-workshop comments in response to the December 2, 2005 Assigned Commissioner's Ruling in R.04-04-003 and continuing through the proceeding. TURN participated in creating the Joint Parties proposal, participated in the workshop to discuss the proposal, contributed to all subsequent Joint Parties filings, and submitted several separate supporting comments. D.06-07-029 directly utilized some of TURN's arguments in support of the adopted policy:

TURN Contributions

Reference in Decision

Given the urgent need for new capacity and the lengthy lead-times required both for new construction and to develop and implement new market institutions, the Commission concludes that staying the course is too risky.

page 4

TURN has stated that it would be unfair to bundled customers to require the IOUs alone to invest in long-term contracts if those contracts cost more than existing generation.

pages 12-13

But as TURN noted, it is more important that the Commission figure out how to ensure new generation needed for system reliability gets built when it is not in the interest of any LSE or its customers to take on such an obligation.

pages 24-25

. . . if the IOUs have to pass on the entire cost of the new generation to just their bundled customers, with no wider cost allocation scheme, then the cost of energy from an IOU will necessarily be more expensive that that from a competing DA provider. Because the non-utility LSEs do not have RAR requirements that necessitate them entering into long-term contracts, the non-utility LSEs would not have to pay the price of a contract for new generation. This situation will create an unacceptable inequitable balance between IOU bundled ratepayers and other ratepayers.

page 46

The Commission finds reasonable TURN's claim for substantial contribution to D.06-07-029. The Commission benefited from TURN's participation, analysis, and discussion of the issues.

4.2. Contributions to A.05-06-003

The Commission does not analyze TURN's claim for substantial contribution to A.05-06-003 because TURN failed to meet the procedural requirements in filing its request for compensation.

4.3. Contributions to D.07-09-044

TURN alleges an active involvement in Phase II of proceeding R.06-02-013, contributing to D.07-09-044. TURN propounded discovery, prepared direct and rebuttal testimony, participated in workshops, working groups and negotiation sessions, cross-examined witnesses, filed opening and closing briefs, and filed opening and reply comments on the proposed decision.

With respect to D.07-09-044, TURN represented the interests of small bundled service customers at the public workshops and negotiation sessions. TURN focused on the "Benefit and Cost Allocation" section of the settlement and minimized its costs of participation by avoiding undue involvement in issues tangential to the interests of these customers. D.07-09-044 adopted the joint settlement agreement as presented by TURN and the other settling parties with only minor modifications. The Commission finds reasonable TURN's claim of substantial contribution to D.07-09-044.

4.4. Contributions to D.07-12-052

TURN alleges the following contributions to D.07-12-052:

TURN Contributions

Effects on the Decision

(1) Recommendation to find that any new conventional resource procurement authorization adopted in this case should based on the adopted Planning Reserve Margin (PRM) and not some other criteria. Furthermore, after providing testimony and conducting cross-examination, recommendation to reject PG&E's proposed changes to its PRM.

* The Commission included this recommendation in the need determination tables and in Findings of Fact 42, 46, and 48 (calculating the range of need as a 15% -- 17% Planning Reserve Requirement) (pp. 116-118, 277-278).
* The Commission rejected PG&E's requested changes for its PRM. (See Finding of Fact 38, p. 276.)
* The Commission found that the need determination for each IOU would be based on, inter alia, the PRM assessments. (See Finding of Fact 41, p. 277.)

(2) Recommendation to find that potential increases in Community Choice Aggregator (CCA) or Direct Access (DA) load will impact future bundled customer needs but not the physical resource need in the utility service area as a whole.

* Finding of Fact 17: The Commission finds that PG&E, SCE and SDG&E's assessment that system need is not impacted by possible future load shifting to DA and CCA is reasonable and that future DG and MDL is captured by the historical trends used to develop the forecast. (P. 272.)
* Conclusion of Law 8: System need is not impacted by possible future load shifting to DA and CCA, and future DG and MDL is captured by the historical trends used to develop the IOUs' forecasts. (P. 292.)

(3) Recommendation to not require the utilities to discontinue contracting with "aging plants" by an arbitrary date certain but rather allow market forces to dictate the pace of unit retirements.

* In consideration of the issues surrounding plant retirement, the Commission found merit in TURN's position, which assisting us in moderating the proposals of PG&E and CEC. (Pp. 88-89.)

(4) Recommendation to adopt PG&E's aggressive forecast of aging plant retirements if and only if the potential availability of these older units to "bridge the gap" is also taken into account in addressing the contingency that preferred resources may not develop as quickly as forecasted. Recommendation not to adopt an assumption that all of the aging plants will retire if that assumption leads to the construction of new conventional units as a contingency for the potential delay of preferred resources.

* The Commission effectively followed TURN's recommendation by rejecting the contingencies requested by PG&E. (See Finding of Fact 39, pp. 276-277.)

(5) Recommendation to reject PG&E's proposal to procure to meet a higher PRM pending consideration of the appropriate PRM for all LSEs in Phase II of R.05-12-013.

* The Commission declined any changes to the IOU's PRMs. (See Finding of Fact 38, p. 276; and Conclusion of Law 22, p. 294.)

(6) Recommendation to reject PG&E's proposal to procure an additional 500 MW of new resources because of the possibility that Resource Adequacy counting rules may be changed in the future.

* The Commission directed PG&E to pursue its requested Resource Adequacy Counting contingency in the appropriate proceeding devoted to Resource Adequacy. (P. 96.)

(7) Recommendation to recognize that new resources currently "in the pipeline" may not all be developed as currently planned but address that contingency by allowing aging plants to continue to operate, rather than by authorizing procurement of additional new conventional plants.

* TURN states that the decision assures that new conventional generation will not be developed based solely on the potential that some preferred resources may be delayed or cancelled. (See Findings of Fact 31, 37, and 39, pp. 275-277.)

(8) Recommendation to allow the utilities to procure a limited amount of new resources beyond just the amount needed to meet the PRM, but only if those additional resources will reduce the Net Present Value of ratepayer costs when compared with not procuring such new resources.

* TURN notes that while the decision did not directly address this issue, the decision accomplished a similar result by authorizing a range of need rather than a point estimate based solely on the minimum PRM.

(9) Recommendation to find that the PG&E service area has no need for new resources prior to 2014. Recommendation not to authorize more than 200 to 700 MW of new conventional procurement with authorization for the higher amount being contingent upon the receipt of bids that would reduce the Net Present Value of ratepayer costs when compared with not procuring the resource.

* The Commission's published need determination table for PG&E shows no estimate of need before 2014. (P. 116.)
* The Commission found that PG&E's service area shows a need of 800 to 1,200 MW by 2015, which is more than TURN's recommendation but less than PG&E's request for 2,300 to 2,500 MW. (Finding of Fact 41, p. 277; pp. 104-105.)

(10) Recommendation to find that any new resource procurement authorization for the Edison service area should not exceed a range of from 500 to 1,000 MW (using 2013 as the base year), depending upon the attractiveness of the offers received and to allocate the resulting net costs to all customers per D.06-07-029.

* The Commission's published need determination table for SCE shows an estimated need in 2013 from 250 MW at 15% PRM to 717 MW at 17% PRM. (P. 117.)
* The Commission found an estimated need for SCE's service area from 1,200 MW to 1,700 MW by 2015. (P. 117; Finding of Fact 46, p. 278.)

(11) Recommendation to continue the Procurement Review Groups (PRG) and expand them to include DA and CCA customers only when reviewing RFOs conducted pursuant to D.06-07-029 that will result in an allocation of costs to those customers, assuming that the necessary non-disclosure agreements can be worked out. TURN was an active participant of the PRG Participation Working Group.

* The Commission directed the utilities to continue to use PRGs as advisors for the procurement activities. (Finding of Fact 53, p. 279.)
* The Commission adopted the PRG Participation Working Group proposal to create a CAM Group for procurement which shall include representatives of CCA and DA customers. (Finding of Fact 58, p. 280.)
* The adopted proposal included NDA obligations. (Appendix D, pp. 3-5.)

(12) Recommendation to continue use of an Independent Evaluator (IE) and to consider having the Energy Division (ED), rather than the utility, hire and supervise the IE if the related state contracting issues can be satisfactorily resolved.

* The Commission found it reasonable to continue the use of IEs. (Finding of Fact 59, p. 280.)
* The Commission found that, at this time, it is not practical to transfer the IE contracting authority to the Commission. (P. 136.) However, the Commission adopted SCE's proposal that ED should be involved during the selection process, the development of the scope of work and the drafting of the terms of the contracts with the IE and have the right to final approval of such engagements. (Finding of Fact 60, p. 280.)

(13) Recommendation to support further development of methods for evaluating potential transmission costs avoided by local area generation projects that may eliminate or postpone the need for additional transmission capacity into a constrained area.

* The Commission declined to make any findings or orders on how transmission costs and benefits are to be evaluated for specific generation projects in the RFO process. (Finding of Fact 78, p. 283.)
* The Commission reiterated its order from D.04-12-048 regarding the IOUs consideration of Brownfield sites before considering building new generation on Greenfield sites. (Finding of Fact 103, p. 288.)

(14) Recommendation to consider requiring the utilities to use a higher discount rate (based on the utility's pre-tax weighted average cost of capital) when evaluating proposed long-term investments.

* TURN notes that the Commission's decision did not directly address this issue.

(15) Recommendation to adopt TURN's proposed framework for comparing PPA bids with cost estimates for utility-owned generation in competitive solicitations and to require the utilities to propose ratemaking mechanisms to mitigate the cost and performance risks to ratepayers when seeking approval of utility-owned projects.

* TURN states that the Commission's preference for a "competitive market first" approach is consistent with TURN's overall approach. (See pp. 201-213.)
* In the Commission's discussion about comparing UOG and IPP bids, the Commission favorably cited TURN's position regarding allowing head-to-head competition subject to safeguards. (P. 206; see also Findings of Fact 94, 98-99, pp. 287-287.)
* The Commission appreciated TURN's proposal for unique circumstances in which UOG outside of a competitive RFO may be the most attractive option to ratepayers for resource development. (P. 210.)
* The Commission found that if an IOU proposes a UOG project outside of a competitive RFO, it is reasonable to require the IOU to make a showing that holding a competitive RFO is infeasible. (Finding of Fact 100, p. 287.)

(16) Recommendation to adopt TURN's proposal for implementation of AB 1576.

* The Commission decided not to make any new finding in regards to AB 1576 repowering projects. (Finding of Fact 103, p. 288.) TURN notes that this decision validated TURN's comments on problems with proposals by Edison, Mirant, and LS Power.

(17) Recommendation to support the continued development of a procurement "rulebook" for all of the utilities but to find that it should remain a reference tool and not supersede or otherwise supplant.

* The Commission endorsed, but did not yet adopt, the concept of SCE's Rulebook in principle and directed ED, the IOUs, and other parties to create a Procurement Plan Implementation Manual" for each IOU. (Finding of Fact 102, pp. 287-288.)
* The Commission concurred with TURN's position that the IOUs accurately reflect their EE goals in their LTPPs. (Finding of Fact 19, p. 272; Conclusion of Law 11, p. 292.)
* TURN notes that it opposed and the Commission did not adopt the IOU's proposed changes to the Commission's EE policies.
* The Commission held that IOUs may tailor their RFOs to address particular needs (procurement, system reliability, RA requirements) but are prohibited from creating false barriers to participation or attempting to limit or manipulate the competitive process. (Finding of Fact 65, p. 281; Conclusion of Law 25, p. 294.)

The Commission finds reasonable TURN's claim for substantial contribution to D.07-12-052. While the Commission did not adopt or address all of TURN's recommendations, most of them were highly relevant to the Commission's decision and elevated the discussion and the Commission's consideration. TURN's advocacy had a significant impact on the Commission's decision.

³ D.98-04-059, 79 CPUC2d 628 at 653.

⁴ TURN notes that the Joint Parties proposal is a descendant of TURN's original proposal in R.01-10-024 and of the SCE proposal in A.05-06-003, which TURN supported.

TURN Contributions	Reference in Decision
Given the urgent need for new capacity and the lengthy lead-times required both for new construction and to develop and implement new market institutions, the Commission concludes that staying the course is too risky.	page 4
TURN has stated that it would be unfair to bundled customers to require the IOUs alone to invest in long-term contracts if those contracts cost more than existing generation.	pages 12-13
But as TURN noted, it is more important that the Commission figure out how to ensure new generation needed for system reliability gets built when it is not in the interest of any LSE or its customers to take on such an obligation.	pages 24-25
. . . if the IOUs have to pass on the entire cost of the new generation to just their bundled customers, with no wider cost allocation scheme, then the cost of energy from an IOU will necessarily be more expensive that that from a competing DA provider. Because the non-utility LSEs do not have RAR requirements that necessitate them entering into long-term contracts, the non-utility LSEs would not have to pay the price of a contract for new generation. This situation will create an unacceptable inequitable balance between IOU bundled ratepayers and other ratepayers.	page 46

TURN Contributions	Effects on the Decision
(1) Recommendation to find that any new conventional resource procurement authorization adopted in this case should based on the adopted Planning Reserve Margin (PRM) and not some other criteria. Furthermore, after providing testimony and conducting cross-examination, recommendation to reject PG&E's proposed changes to its PRM.	* The Commission included this recommendation in the need determination tables and in Findings of Fact 42, 46, and 48 (calculating the range of need as a 15% -- 17% Planning Reserve Requirement) (pp. 116-118, 277-278). * The Commission rejected PG&E's requested changes for its PRM. (See Finding of Fact 38, p. 276.) * The Commission found that the need determination for each IOU would be based on, inter alia, the PRM assessments. (See Finding of Fact 41, p. 277.)
(2) Recommendation to find that potential increases in Community Choice Aggregator (CCA) or Direct Access (DA) load will impact future bundled customer needs but not the physical resource need in the utility service area as a whole.	* Finding of Fact 17: The Commission finds that PG&E, SCE and SDG&E's assessment that system need is not impacted by possible future load shifting to DA and CCA is reasonable and that future DG and MDL is captured by the historical trends used to develop the forecast. (P. 272.) * Conclusion of Law 8: System need is not impacted by possible future load shifting to DA and CCA, and future DG and MDL is captured by the historical trends used to develop the IOUs' forecasts. (P. 292.)
(3) Recommendation to not require the utilities to discontinue contracting with "aging plants" by an arbitrary date certain but rather allow market forces to dictate the pace of unit retirements.	* In consideration of the issues surrounding plant retirement, the Commission found merit in TURN's position, which assisting us in moderating the proposals of PG&E and CEC. (Pp. 88-89.)
(4) Recommendation to adopt PG&E's aggressive forecast of aging plant retirements if and only if the potential availability of these older units to "bridge the gap" is also taken into account in addressing the contingency that preferred resources may not develop as quickly as forecasted. Recommendation not to adopt an assumption that all of the aging plants will retire if that assumption leads to the construction of new conventional units as a contingency for the potential delay of preferred resources.	* The Commission effectively followed TURN's recommendation by rejecting the contingencies requested by PG&E. (See Finding of Fact 39, pp. 276-277.)
(5) Recommendation to reject PG&E's proposal to procure to meet a higher PRM pending consideration of the appropriate PRM for all LSEs in Phase II of R.05-12-013.	* The Commission declined any changes to the IOU's PRMs. (See Finding of Fact 38, p. 276; and Conclusion of Law 22, p. 294.)
(6) Recommendation to reject PG&E's proposal to procure an additional 500 MW of new resources because of the possibility that Resource Adequacy counting rules may be changed in the future.	* The Commission directed PG&E to pursue its requested Resource Adequacy Counting contingency in the appropriate proceeding devoted to Resource Adequacy. (P. 96.)
(7) Recommendation to recognize that new resources currently "in the pipeline" may not all be developed as currently planned but address that contingency by allowing aging plants to continue to operate, rather than by authorizing procurement of additional new conventional plants.	* TURN states that the decision assures that new conventional generation will not be developed based solely on the potential that some preferred resources may be delayed or cancelled. (See Findings of Fact 31, 37, and 39, pp. 275-277.)
(8) Recommendation to allow the utilities to procure a limited amount of new resources beyond just the amount needed to meet the PRM, but only if those additional resources will reduce the Net Present Value of ratepayer costs when compared with not procuring such new resources.	* TURN notes that while the decision did not directly address this issue, the decision accomplished a similar result by authorizing a range of need rather than a point estimate based solely on the minimum PRM.
(9) Recommendation to find that the PG&E service area has no need for new resources prior to 2014. Recommendation not to authorize more than 200 to 700 MW of new conventional procurement with authorization for the higher amount being contingent upon the receipt of bids that would reduce the Net Present Value of ratepayer costs when compared with not procuring the resource.	* The Commission's published need determination table for PG&E shows no estimate of need before 2014. (P. 116.) * The Commission found that PG&E's service area shows a need of 800 to 1,200 MW by 2015, which is more than TURN's recommendation but less than PG&E's request for 2,300 to 2,500 MW. (Finding of Fact 41, p. 277; pp. 104-105.)
(10) Recommendation to find that any new resource procurement authorization for the Edison service area should not exceed a range of from 500 to 1,000 MW (using 2013 as the base year), depending upon the attractiveness of the offers received and to allocate the resulting net costs to all customers per D.06-07-029.	* The Commission's published need determination table for SCE shows an estimated need in 2013 from 250 MW at 15% PRM to 717 MW at 17% PRM. (P. 117.) * The Commission found an estimated need for SCE's service area from 1,200 MW to 1,700 MW by 2015. (P. 117; Finding of Fact 46, p. 278.)
(11) Recommendation to continue the Procurement Review Groups (PRG) and expand them to include DA and CCA customers only when reviewing RFOs conducted pursuant to D.06-07-029 that will result in an allocation of costs to those customers, assuming that the necessary non-disclosure agreements can be worked out. TURN was an active participant of the PRG Participation Working Group.	* The Commission directed the utilities to continue to use PRGs as advisors for the procurement activities. (Finding of Fact 53, p. 279.) * The Commission adopted the PRG Participation Working Group proposal to create a CAM Group for procurement which shall include representatives of CCA and DA customers. (Finding of Fact 58, p. 280.) * The adopted proposal included NDA obligations. (Appendix D, pp. 3-5.)
(12) Recommendation to continue use of an Independent Evaluator (IE) and to consider having the Energy Division (ED), rather than the utility, hire and supervise the IE if the related state contracting issues can be satisfactorily resolved.	* The Commission found it reasonable to continue the use of IEs. (Finding of Fact 59, p. 280.) * The Commission found that, at this time, it is not practical to transfer the IE contracting authority to the Commission. (P. 136.) However, the Commission adopted SCE's proposal that ED should be involved during the selection process, the development of the scope of work and the drafting of the terms of the contracts with the IE and have the right to final approval of such engagements. (Finding of Fact 60, p. 280.)
(13) Recommendation to support further development of methods for evaluating potential transmission costs avoided by local area generation projects that may eliminate or postpone the need for additional transmission capacity into a constrained area.	* The Commission declined to make any findings or orders on how transmission costs and benefits are to be evaluated for specific generation projects in the RFO process. (Finding of Fact 78, p. 283.) * The Commission reiterated its order from D.04-12-048 regarding the IOUs consideration of Brownfield sites before considering building new generation on Greenfield sites. (Finding of Fact 103, p. 288.)
(14) Recommendation to consider requiring the utilities to use a higher discount rate (based on the utility's pre-tax weighted average cost of capital) when evaluating proposed long-term investments.	* TURN notes that the Commission's decision did not directly address this issue.
(15) Recommendation to adopt TURN's proposed framework for comparing PPA bids with cost estimates for utility-owned generation in competitive solicitations and to require the utilities to propose ratemaking mechanisms to mitigate the cost and performance risks to ratepayers when seeking approval of utility-owned projects.	* TURN states that the Commission's preference for a "competitive market first" approach is consistent with TURN's overall approach. (See pp. 201-213.) * In the Commission's discussion about comparing UOG and IPP bids, the Commission favorably cited TURN's position regarding allowing head-to-head competition subject to safeguards. (P. 206; see also Findings of Fact 94, 98-99, pp. 287-287.) * The Commission appreciated TURN's proposal for unique circumstances in which UOG outside of a competitive RFO may be the most attractive option to ratepayers for resource development. (P. 210.) * The Commission found that if an IOU proposes a UOG project outside of a competitive RFO, it is reasonable to require the IOU to make a showing that holding a competitive RFO is infeasible. (Finding of Fact 100, p. 287.)
(16) Recommendation to adopt TURN's proposal for implementation of AB 1576.	* The Commission decided not to make any new finding in regards to AB 1576 repowering projects. (Finding of Fact 103, p. 288.) TURN notes that this decision validated TURN's comments on problems with proposals by Edison, Mirant, and LS Power.
(17) Recommendation to support the continued development of a procurement "rulebook" for all of the utilities but to find that it should remain a reference tool and not supersede or otherwise supplant.	* The Commission endorsed, but did not yet adopt, the concept of SCE's Rulebook in principle and directed ED, the IOUs, and other parties to create a Procurement Plan Implementation Manual" for each IOU. (Finding of Fact 102, pp. 287-288.) * The Commission concurred with TURN's position that the IOUs accurately reflect their EE goals in their LTPPs. (Finding of Fact 19, p. 272; Conclusion of Law 11, p. 292.) * TURN notes that it opposed and the Commission did not adopt the IOU's proposed changes to the Commission's EE policies. * The Commission held that IOUs may tailor their RFOs to address particular needs (procurement, system reliability, RA requirements) but are prohibited from creating false barriers to participation or attempting to limit or manipulate the competitive process. (Finding of Fact 65, p. 281; Conclusion of Law 25, p. 294.)