5. Preliminary Scoping Memo

The general scope of this proceeding is to review the impact, success, target goals, and disparities within procurement areas of utility General Order 156 programs. The scope also includes consideration of the economic efficiencies of compliance, information sharing to improve performance, integration of new procurement areas such as "green" energy-related contracts, and examination of diversity and continuity in each utility's workforce. To address the issues delineated above, we pose the following questions for all interested parties to comment on.

5.1. Issues to Be Addressed

GO 156 Program Results

1. Are the utilities achieving the 15% goal for minority-owned business enterprises, the 5% goal for woman-owned business enterprises, and 1.5% goal for disabled veteran business enterprises set forth in § 8.2? If not, what steps are they taking to meet them? Are utilities encouraging their prime contractors to develop and use qualified WMDVBE sub-contractors? Should utilities be working with communities, businesses, and non-profits to help diverse businesses grow and thrive?

2. Have utilities focused on diversity suppliers in certain areas of procurement (e.g., "blue collar" categories) without making similar gains in other more technical areas such as legal, financial, and consulting? If so, what new steps and practices could the utilities take to expand use of qualified WMDVBE suppliers in underutilized procurement categories?

3. Specifically describe all efforts (including any mentoring programs that have been developed) by utilities to develop WMDVBE suppliers of legal services and financial services, including investment fund managers for private pensions and other managed funds.

4. What are the biggest barriers that WMDVBE companies face in becoming competitive for procurement contracts? What can the Commission do to assist utilities in developing a pool of diverse suppliers in underutilized categories of procurement?

5. If the largest utilities are meeting the initial aggregate goal of 21.5% for WMDVBE suppliers, would an increase in targeted goals promote a renewed emphasis on seeking diverse suppliers across a broad range of procurement? Are there other reasons to increase any or all of the targeted goals? If so, is an aggregate goal of 30%, or some other number, reasonable?

Improvements to GO 156 and Beyond

6. Should GO 156, §9, be amended to require utilities to report on the economic benefits of using WMDVBE suppliers? Has this information been previously gathered by the utilities? If so, utilities should provide it. Are there any issues about measurement of such benefits?

7. Are there any internal or external obstacles to utilities that cause WMDVBE procurement to be spread unevenly throughout product and service categories, e.g., a shortage of diverse suppliers in some areas? Are there any amendments to GO 156 that would help reduce or eliminate such obstacles? If so, please provide the actual language of any proposed amendment.

8. Should the Commission organize a forum to bring the utilities and the public together for open dialogue to share experiences, practices, and actions within the GO 156 programs to overcome market saturation in some procurement categories and underutilization in others?

9. What problems do utilities face in finding new areas of procurement for WMDVBE suppliers? Identify areas for procurement not currently recognized in current GO 156 programs.

10. Have any of the utilities' affiliated companies, including any holding company or parent corporation, developed supplier diversity programs for non-regulated business entities and activities? If yes, please describe these programs and the economic benefits thereof. Do the utilities acquire goods and services from an unregulated affiliate who contracts directly with outside suppliers? If yes, explain why the procurement contracts are not made directly between the utility and the supplier.

11. What new procurement areas are now, or are becoming, available to utilities related to clean energy, so-called "green" categories? Are there certain skills and training that suppliers need for these areas? Should diversity goals be applied to contracts for renewable energy, solar energy distributed generation projects, and energy efficiency? Are these markets sufficiently developed to include diversity goals? Are there strategies in place to develop diverse supplier pools? Are there other "green" procurement areas that should be included in the GO 156 programs?

12. What is the current demographic composition of each utility's workforce? Provide the information in three categories using the applicable categories set forth in GO 77-M: Executive Officers and employees, 2^nd tier employees above specified compensation levels, and other employees. How does this compare with the five previous years? Describe the utility's internal diversity programs for recruitment, training, and promotion.

13. Do the utilities have workforce areas where significant numbers of workers in certain job classifications are approaching retirement age? If so, what are the classifications, how much lead time is needed for adequate replacement training, and what actions have the utilities taken to assure continuity of the workforce?

14. Are the utilities working with communities, non-profits, and schools to ensure a diverse and well-trained workforce is being developed? What specific programs have the utilities supported at community colleges and job training institutes (e.g., solar panel installation, renewable energy generation, pre-engineering, etc.). What other resources have the utilities offered to promote a trained replacement workforce (e.g., classroom expertise, equipment, internships, etc.).

15. Are there any other programs not identified by the above questions that the utilities are involved in to create and sustain a diverse utility workforce?

16. Are there any other ideas or issues that the Commission should consider as it undertakes this evaluation of the GO 156 program?

5.2. Schedule and Initial Comments

The schedule for this proceeding is stated below in Table 5:

Table 5

Parties are strongly encouraged to meet and confer to determine whether they can reach sufficient agreement on some matters so that they can jointly file Responses, Opening Comments, and Replies. Following the receipt of Responses, Opening Comments, and Replies, we anticipate holding a prehearing conference (PHC).

This proceeding will conform to the statutory case management deadline for quasi-legislative matters set forth in Pub. Util. Code § 1701.5. In particular, it is our intention to resolve all relevant issues within 24 months of the date of the assigned Commissioner's scoping memo for each phase. In using the authority granted in Section 1701.5(b) to set a time longer than 18 months, we consider the number and complexity of the issues and tasks.

5.3. Proceeding Category and Need for Hearing

Rule 7.1(d) of the Commission's Rules of Practice and Procedure (Rules) specifies that an order instituting rulemaking will preliminarily determine the category of the proceeding and the need for hearing and include a preliminary scoping memo. Pursuant to Rule 7.1(e), we determine that this proceeding is quasi-legislative as defined in Rule 1.3(d). We anticipate that the issues in this proceeding may be resolved through a combination of comments and workshops without the need for evidentiary hearings. Any person who objects to the preliminary categorization of this rulemaking or to the preliminary hearing determination shall state their objections in their Responses or Opening Comments. The assigned Commissioner will issue a scoping memo making a final category determination; this final determination is subject to appeal under Rule 7.6(a).