6. Assignment of Proceeding
Mark J. Ferron is the assigned Commissioner and Anne E. Simon is the assigned ALJ in this portion of this proceeding.
1. SB 2 (1X) became effective December 10, 2011.
2. SB 2 (1X) establishes three multi-year RPS compliance periods (2011-2013; 2014-2016; and 2017-2020) and annual compliance periods for 2021 and later years.
3. In D.11-12-020, the Commission determined that the provisions of SB 2 (1X) govern RPS compliance as of January 1, 2011.
4. SB 2 (1X) changes the prior requirements for retail sellers to be able to count procurement from short term contracts for RPS compliance.
5. At this time, the CEC has no requirement for retail sellers to retire RECs in the year they are generated or in the year the RECs are intended to be used for RPS compliance; thus, RECs retired in 2011 could be used for the 2008, 2009, or 2010 compliance year, in accordance with the CEC's Eligibility Guidebook.
6. Many retail sellers have contracts or ownership agreements originally executed prior to June 1, 2010 that will provide RPS-eligible procurement for 2011 and later years.
7. PacifiCorp is the balancing authority for its California service territory.
8. PacifiCorp is not a California balancing authority listed in D.11-12-052.
9. NV Energy is the balancing authority for the service territory of CalPeco.
10. NV Energy is not a California balancing authority listed in D.11-12-052.
11. The service territory of BVES is within the balancing authority of the California Independent System Operator.
12. The California Independent System Operator is a California balancing authority listed in D.11-12-052.
13. The cost cap imposed on procurement of electricity by BVES by D.02-07-041 is no longer in effect.
1. In order to close the books on compliance with RPS requirements for 2010 and prior years in a transparent and efficient manner, all retail sellers should be required to calculate their deficits, if any, in meeting their APT obligations for all years prior to 2011 and submit their calculations in their closing report to the Director of Energy Division within 60 days of the effective date of this decision.
2. In order to allow an accurate calculation of their deficits, if any, in meeting their APT obligations for all years prior to 2011, each retail sellers should be required to retire for RPS compliance all RECs associated with generation prior to 2011 and available for RPS compliance years 2008, 2009, and 2010, up to the full amount of its APT obligations in each year, before submitting its closing report to the Director of Energy Division.
3. In calculating their deficits, if any, in meeting their APT obligations for all years prior to 2011, retail sellers should be allowed to count only procurement that complies with all RPS requirements for the year in which is claimed to meet APT obligations for any year prior to 2011.
4. In calculating their deficits, if any, in meeting their APT obligations for all years prior to 2011, retail sellers should not be allowed to use any mechanisms for deferring shortfalls under the flexible compliance rules in effect for all years prior to 2011.
5. In calculating their deficits, if any, in meeting their APT obligations for all years prior to 2011, retail sellers should be allowed to count surplus procurement under the prior flexible compliance rules to meet their APT obligations in any year prior to 2011 in which the surplus procurement may be applied.
6. After calculating its deficits, if any, in meeting its APT obligations for all years prior to 2011, a retail seller that has met all its APT obligations should be allowed to carry forward any procurement from contracts or ownership agreements originally executed prior to June 1, 2010 (and, for retail sellers that are IOUs but not MJUs, that were approved by the Commission) that is not necessary to meet its APT obligations in years prior to 2011 for use in any compliance period after 2010, without limitation.
7. All retail sellers should be required to calculate the percentage of their retail sales provided by RPS-eligible procurement in 2010 and submit their calculation to the Director of Energy Division within 60 days of the effective date of this decision.
8. Retail sellers should update any closing report based on procurement information that has not been verified by the CEC not later than 30 days after the CEC's transmittal of the final Verification Report for the relevant year to the Commission.
9. In calculating the percentage of their retail sales provided by RPS-eligible procurement in 2010, retail sellers should not be allowed to use any mechanisms to defer shortfalls under the flexible compliance rules for all years prior to 2011.
10. In calculating the percentage of their retail sales provided by RPS-eligible procurement in 2010, retail sellers should not be allowed to count surplus procurement not necessary to meet APT obligations in prior years.
11. Any retail seller whose RPS-eligible procurement in 2010, as specified by this decision, is equal to or greater than 14% of its total retail sales, should not have to make up deficits, if any, in meeting APT requirements in 2010 and prior years.
12. Any retail seller that is required to make up a prior deficit for any years prior to 2011 should be required to make up the deficit by not later than December 31, 2013.
13. In order to conform to statutory requirements and preserve value for retail sellers and ratepayers, retail sellers should be allowed to use contracts or ownership agreements for RPS procurement signed prior to June 1, 2010 for all compliance purposes, so long as the contracts and the related renewable energy resources meet all the conditions set forth in Section 399.16(d).
14. In order to provide consistent treatment of RPS procurement, if a contract or ownership agreement originally signed prior to June 1, 2010 is amended or modified after June 1, 2010, to increase the nameplate capacity or expected quantities of annual generation, the originally contracted procurement should continue to count in full, but the incremental procurement resulting from the amendment or modification should be subject to the then-applicable rules for portfolio balance, long-term contracting, and excess procurement.
15. In order to count procurement from short term contracts signed after June 1, 2010 for RPS compliance in a compliance period, retail sellers should be required to sign in the compliance period in which the short term contract is signed, long term contracts with expected generation equal to at least 0.25% of their retail sales in the immediately prior compliance period.
16. In order to comply with the changes to the long term contracting requirements made by SB 2 (1X), retail sellers should not be allowed to apply any excess MWh from the prior minimum quantity requirements for the use of short term contracts established by D.07-05-028.
17. In order to reflect the multi-year compliance periods instituted by SB 2 (1X), the long term contracting requirements set forth in this decision should apply to each compliance period, without carrying over any MWh from long term contracts signed in a previous compliance period.
18. In order to count procurement from short term contracts signed after June 1, 2010 for RPS compliance in the 2011-2013 compliance period, retail sellers should be required to sign in the compliance period in which the short term contract is signed, long term contracts with expected generation equal to at least 0.25% of their retail sales in 2010.
19. The requirements for the use of short term contracts should apply to multi-jurisdictional utilities with respect to their retail sales to their California customers.
20. In order to count procurement from short term contracts signed after June 1, 2010 for RPS compliance in a compliance period, retail sellers newly commencing operations in California should be required to sign in the first compliance period of their operation in which any short term contract is signed, long term contracts with expected generation equal to at least 0.25% of their retail sales in the first year of their retail operations in California. For all later compliance periods, such retail sellers should be required to sign in that compliance period long term contracts equal to at least 0.25% of their retail sales in the immediately prior compliance period. The Director of Energy Division should be authorized to consult with retail sellers about the application of this requirement.
21. In order to provide additional ways for smaller retail sellers to comply with the requirements for the use of procurement from short term contracts, retail sellers should be able to use long term contracts that have been repackaged from long term contracts entered into by other retail sellers to meet the requirement of signing in the compliance period in which the short term contract is signed, long term contracts with expected generation equal to at least 0.25% of their retail sales in the immediately prior compliance period.
22. Because the compliance periods change in 2021 and later years, the requirements for the use of procurement from short term contracts set by this decision should end as of December 31, 2020.
23. In order to provide a consistent rule for retirement of RECs, any REC retired for RPS compliance by a retail seller on or after January 1, 2011, should be retired within 36 months of the initial date of the associated generation, regardless of whether the associated electricity was generated before or after January 1, 2011.
24. In order to avoid double-counting of compliance shortfalls, compliance with the portfolio balance requirements set in Section 399.16(c) should be determined separately from compliance with the procurement quantity requirements set by Section 399.15(b).
25. In order to implement a balanced portfolio, the maximum limitation set in Section 399.16(c)(2) on the use of procurement meeting the criteria of Section 399.16(b)(3) should be determined by multiplying the percentage limitation for a particular compliance period by the total procurement credited toward the compliance period from contracts or ownership agreements signed after June 1, 2010.
26. In order to implement a balanced portfolio, the minimum requirement for the use of procurement meeting the criteria of Section 399.16(b)(1) set in Section 399.16(c)(1) should be determined by multiplying the minimum percentage for a particular compliance period by the total procurement credited toward the compliance period from contracts or ownership agreements signed after June 1, 2010.
27. In calculating excess procurement in one compliance period that may be applied to a later compliance period, including 2021 and later years, retail sellers should subtract from the total quantity of renewable energy credits they retire in that compliance period, all renewable energy credits associated with short term contracts signed after June 1, 2010.
28. In calculating excess procurement in one compliance period that may be applied to a later compliance period, including 2021 and later years, retail sellers should subtract from the total quantity of renewable energy credits they retire in that compliance period, all renewable energy credits necessary to meet their procurement quantity requirement for that compliance period.
29. In calculating excess procurement in one compliance period that may be applied to a later compliance period, including 2021 and later years, retail sellers other than retail sellers described in Section 399.17 should subtract from the total quantity of renewable energy credits they retire in that compliance period, all renewable energy credits associated with contracts signed after June 1, 2010 meeting the criteria of Section 399.16(b)(3) that are more than the number allowed under the limitation set out in Section 399.16(c)(2).
30. In calculating excess procurement in one compliance period that may be applied to a later compliance period, including 2021 and later years, retail sellers described in Section 399.17 should subtract from the total quantity of renewable energy credits they retire in that compliance period, all renewable energy credits associated with contracts signed after June 1, 2010 for the procurement of unbundled renewable energy credits from third parties that are more than the number allowed under the limitation set out in Section 399.16(c)(2)
31. In order to comply with the portfolio balance requirements, when retail sellers other than retail sellers described in Section 399.17 apply excess procurement to RPS compliance in a later compliance period, they should apply procurement associated with contracts signed after June 1, 2010 according to the portfolio balance requirements set out in Section 399.16(c).
32. In order to comply with the portfolio balance requirements, when retail sellers other than retail sellers described in Section 399.17 apply excess procurement to RPS compliance in a later compliance period, they should apply excess procurement that meets the criteria of Section 399.16(b)(1) to the minimum requirement set by Section 399.16(c)(1).
33. Since it is no longer subject to a cost cap for electricity procurement, BVES should be allowed to submit RPS procurement contracts for Commission approval by advice letter in the same manner as other California utilities.
34. In order to promote effective administration of the RPS program, each retail seller should be required to submit an annual RPS compliance report by August 1 of the year following the year being reported on. The report should contain the information required by Section 399.13(a), as well as any additional information required by this decision, or any other Commission decision, or requested by the Director of Energy Division.
35. The annual report submitted by a retail seller by August 1 of the year following the last year of a compliance period should include a separate section providing all the information required to determine compliance with all obligations for that compliance period, including portfolio balance requirements for any excess procurement applied from an earlier compliance period, as well to determine the amount, if any, of excess procurement in that compliance period that may be applied to a later compliance period.
36. In order to provide information about pending generation projects, PG&E, SCE, and SDG&E each should be required to submit a Project Development Status Report with their annual reports.
37. In order to promote fair and efficient administration of the RPS program, a retail seller should be allowed to request a waiver of the procurement quantity requirements set by D.11-12-020 only at the time the retail seller submits its annual report for the last year of the compliance period for which it seeks the waiver.
38. In order to promote fair and efficient administration of the RPS program, a retail seller should be allowed to request a reduction of the portfolio balance requirements set by this decision only at the time the retail seller submits its annual report for the last year of the compliance period for which it seeks the reduction.
39. The Director of Energy Division should be authorized to develop appropriate reporting formats and information requirements for all reports necessary to implement the requirements of this decision.
40. The Director of Energy Division should be authorized to require retail sellers to submit appropriate documentation, including but not limited to copies of RPS procurement contracts, to support the information in any report submitted in accordance with the requirements of this decision.
41. In order to facilitate fair and efficient administration of RPS requirements, the Director of Energy Division should be authorized to require retail sellers to submit reports or other documentation necessary to monitor the progress of the RPS program.
42. In order to facilitate fair and efficient administration of RPS requirements, the Director of Energy Division should be authorized to grant extensions of time to submit any reports or other documents required by this decision.
43. In order to promote fair and efficient compliance with the new RPS requirements of SB 2 (1X), this order should be effective immediately.
IT IS ORDERED that:
1. Each retail seller as defined in Public Utilities Code Section 399.12(j) must calculate its deficits, if any, in meeting its annual procurement targets under the California renewables portfolio standard for all years prior to 2011 and submit the calculation to the Director of Energy Division within 60 days of the effective date of this decision. Any calculations based on procurement information that has not been verified by the California Energy Commission (CEC) must be updated not later than 30 days after the CEC's transmittal of the final Verification Report for the relevant year to the Commission.
2. In calculating its deficits, if any, in meeting its annual procurement targets for all years prior to 2011, each retail seller as defined in Public Utilities Code Section 399.12(j) must retire for compliance with the California renewables portfolio standard (RPS) all renewable energy credits tracked in the Western Renewable Generation Information System that are associated with generation prior to 2011 and available for RPS compliance years 2008, 2009, and 2010, up to the full amount of its annual procurement target in each year, before submitting its closing report to the Director of Energy Division
3. In calculating its deficits, if any, in meeting its annual procurement targets for all years prior to 2011, a retail seller as defined in Public Utilities Code Section 399.12(j) may count only procurement that complies with all procurement and compliance requirements of the California renewables portfolio standard for the year in which it is claimed to meet the annual procurement target for any year prior to 2011.
4. In calculating their deficits, if any, in meeting their annual procurement targets for all years prior to 2011, retail sellers as defined in Public Utilities Code Section 399.12(j) are not allowed to use any mechanisms for deferring shortfalls under the flexible compliance rules in effect for all years prior to 2011.
5. In calculating their deficits, if any, in meeting their annual procurement targets for all years prior to 2011, retail sellers as defined in Public Utilities Code Section 399.12(j) may count surplus procurement from previous years to meet their annual procurement targets in any year prior to 2011 in which the surplus procurement may be applied.
6. After calculating its deficits, if any, in meeting its annual procurement targets (APTs) for all years prior to 2011, a retail seller as defined in Public Utilities Code Section 399.12(j) that has met all its APTs may carry forward any procurement from contracts or ownership agreements signed prior to June 1, 2010 that is greater than the amount necessary to meet its annual procurement target obligations in years prior to 2011 for use in any compliance period after 2010, without limitation, provided that such contracts of investor-owned utilities (other than multi-jurisdictional investor-owned utilities) were approved by the Commission, even if that approval occurred after June 1, 2010.
7. All retail sellers as defined in Public Utilities Code Section 399.12(j) must calculate the percentage of their retail sales provided by procurement from eligible renewable energy resources in 2010 and submit their calculation to the Director of Energy Division within 60 days of the effective date of this decision. Any calculations based on procurement information that has not been verified by the California Energy Commission (CEC) must be updated not later than 30 days after the CEC's transmittal of the final Verification Report for the relevant year to the Commission.
8. In calculating the percentage of their retail sales procured by eligible renewable energy resources in 2010, retail sellers as defined in Public Utilities Code Section 399.12(j) may not use any mechanisms to defer shortfalls under the flexible compliance rules in effect for all years prior to 2011.
9. In calculating the percentage of their retail sales provided by procurement of eligible renewable energy resources procurement in 2010, retail sellers as defined in Public Utilities Code Section 399.12(j) may not count surplus procurement not necessary to meet annual procurement target obligations in prior years.
10. Any retail seller as defined in Public Utilities Code Section 399.12(j) whose procurement of eligible renewable energy resources in 2010, without use of flexible compliance deferrals or banked procurement, is greater than or equal to 14% of its total retail sales is not required to make up any deficits in meeting annual procurement targets in 2010 or prior years.
11. Any retail seller as defined in Public Utilities Code Section 399.12(j) that is required to make up a renewables portfolio standard procurement deficit for any year prior to 2011, as calculated in accordance with this decision, must make up the deficit by not later than December 31, 2013.
12. Retail sellers as defined in Public Utilities Code Section 399.12(j) may use contracts or ownership agreements for renewables portfolio standard (RPS) procurement signed prior to June 1, 2010 for all compliance purposes, so long as the contracts and related renewable energy resources meet all the conditions set forth in Public Utilities Code Section 399.16(d)(3).
13. If a contract or ownership agreement originally signed by a retail seller as defined in Public Utilities Code Section 399.12(j) prior to June 1, 2010 is amended or modified after June 1, 2010, to increase the nameplate capacity or expected quantities of annual generation, the originally contracted procurement may be used for all compliance purposes, but the incremental procurement resulting from the amendment or modification will be subject to the then-applicable rules for portfolio balance, long-term contracting, and excess procurement.
14. If a contract or ownership agreement originally signed by a retail seller as defined in Public Utilities Code Section 399.12(j) prior to June 1, 2010 has an original duration of 15 years or more, and if the duration of the contract or ownership agreement is extended after June 1, 2010, all procurement from the extended contract or ownership agreement may be used for all compliance purposes.
15. In order to count procurement from contracts of less than 10 years duration signed after June 1, 2010 for compliance with the California renewables portfolio standard in a compliance period, a retail seller as defined in Public Utilities Code Section 399.12(j) must sign in the compliance period in which the short term contract is signed, contracts of at least 10 years in duration with expected generation equal to at least 0.25 percent of its retail sales in the immediately prior compliance period.
16. In order to count procurement from contracts of less than 10 years in duration signed after June 1, 2010 for compliance with the California renewables portfolio standard in the 2011-2013 compliance period, a retail seller as defined in Public Utilities Code Section 399.12(j) must sign in the compliance period in which the short term contract is signed, contracts of at least 10 years in duration with expected generation equal to at least 0.25 percent of its retail sales in 2010.
17. Retail sellers as defined in Public Utilities Code Section 399.12(j) may not apply any excess megawatt-hours of expected generation from contracts for compliance with the California renewables portfolio standard that meet the prior minimum quantity requirements for the use of contracts of less than 10 years duration established by Decision 07-05-028 in any compliance period in which the requirements set by this decision for counting procurement from contracts of less than 10 years duration signed after June 1, 2010 for compliance with the California renewables portfolio standard apply.
18. Retail sellers as defined in Public Utilities Code Section 399.12(j) may not carry over from one compliance period to a subsequent compliance period any excess megawatt-hours of expected generation from contracts for compliance with the California renewables portfolio standard that are more than 10 years in duration in order to meet the requirements set in this decision for counting procurement from contracts of less than 10 years in duration signed after June 1, 2010 for compliance with the California renewables portfolio standard.
19. Multi-jurisdictional utilities may base their compliance with the requirements for the use of procurement associated with contracts of less than 10 years' duration for compliance with the California renewables portfolio standard on their retail sales to their California customers.
20. In order to count procurement from short term contracts signed after June 1, 2010 for compliance with the California renewables portfolio standard in a compliance period, a retail seller newly commencing operations in California must sign in the first compliance period of its operation in which any short term contract is signed, long term contracts with expected generation equal to at least 0.25% of its retail sales in the first year of its retail operations in California. For all later compliance periods, each such retail seller is required to sign in that compliance period long term contracts equal to at least 0.25% of its retail sales in the immediately prior compliance period. The Director of Energy Division is authorized to consult with retail sellers about the application of this requirement.
21. In complying with the requirements for use of short term contracts, retail sellers as defined in Public Utilities Code Section 399.12(j) may use contracts of 10 or more years in duration (long term contracts) that are contracts smaller in volume created from long term contracts entered into by other retail sellers, so long as the use of such contracts is properly documented and reported to the Commission, and the eligibility of the generation under the California renewables portfolio standard for both the original contract and the smaller contract is verified by the California Energy Commission.
22. The requirements set by this decision for the use of procurement from contracts less than 10 years in duration will terminate as of December 31, 2020.
23. In order to count for compliance with the California renewables portfolio standard, any renewable energy credit retired for compliance on or after January 1, 2011 by a retail seller as defined in Public Utilities Code Section 399.12(j) must be retired within 36 months of the initial date of the associated generation.
24. Compliance with the portfolio balance requirements set in Public Utilities Code Section 399.16(c) will be determined separately from compliance with the procurement quantity requirements set by Public Utilities Code Section 399.15(b).
25. The maximum limitation on the use of procurement meeting the criteria of Public Utilities Code Section 399.16(b)(3) contained in Public Utilities Code Section 399.16(c)(2) is determined by multiplying the percentage limitation for a particular compliance period by the total procurement credited toward the compliance period from contracts or ownership agreements signed after June 1, 2010.
26. The minimum requirement for the use of procurement meeting the criteria of Public Utilities Code Section 399.16(b)(1) contained in Public Utilities Code Section 399.16(c)(1)) is determined by multiplying the minimum percentage for a particular compliance period by the total procurement credited toward the compliance period from contracts or ownership agreements signed after June 1, 2010.
27. In calculating excess procurement in one compliance period that may be applied to a later compliance period, including 2021 and later years, retail sellers must subtract from the total quantity of renewable energy credits they retire in that compliance period, all renewable energy credits associated with short term contracts signed after June 1, 2010.
28. In calculating excess procurement in one compliance period that may be applied to a later compliance period, including 2021 and later years, retail sellers must subtract from the total quantity of renewable energy credits they retire in that compliance period, all renewable energy credits necessary to meet their procurement quantity requirement for that compliance period.
29. In calculating excess procurement in one compliance period that may be applied to a later compliance period, including 2021 and later years, retail sellers other than retail sellers described in Public Utilities Code Section 399.17 must subtract from the total quantity of renewable energy credits they retire in that compliance period, all renewable energy credits associated with contracts signed after June 1, 2010 meeting the criteria of Public Utilities Code Section 399.16(b)(3) that are more than the number allowed under the limitation set out in Public Utilities Code Section 399.16(c)(2).
30. In calculating excess procurement in one compliance period that may be applied to a later compliance period, including 2021 and later years, retail sellers described in Public Utilities Code Section 399.17 must subtract from the total quantity of renewable energy credits they retire in that compliance period, all renewable energy credits associated with contracts signed after June 1, 2010 for the procurement of unbundled renewable energy credits from third parties that are more than the number allowed under the limitation set out in Public Utilities Code Section 399.16(c)(2).
31. If a retail seller other than a retail seller described in Public Utilities Code Section 399.17 applies excess procurement in one compliance period to compliance in a later compliance period, including 2021 and later years, it must apply procurement associated with contracts signed after June 1, 2010 according to the portfolio balance requirements set out in Public Utilities Code Section 399.16(c).
32. If a retail seller other than a retail seller described in Public Utilities Code Section 399.17 applies excess procurement in one compliance period to compliance in a later compliance period, including 2021 and later years, it must apply excess procurement that meets the criteria of Public Utilities Code Section 399.16(b)(1) to the minimum requirement set by Public Utilities Code Section 399.16(c)(1).
33. As of the effective date of this decision, Bear Valley Electric Service, a division of Golden State Water Company, may submit contracts for procurement for compliance with the California renewables portfolio standard by advice letter in the same manner as other California utilities.
34. Each retail seller must submit an annual report on its compliance with the California renewables portfolio standard by August 1 of the year following the year being reported on. The report must contain all the information required by Public Utilities Code Section 399.13(a), as well as any additional information required by this decision, or any other Commission decision, or requested by the Director of Energy Division. Any compliance report based on procurement information that has not been verified by the California Energy Commission (CEC) must be updated not later than 30 days after the CEC's transmittal of the final Verification Report for the relevant year to the Commission.
35. Pacific Gas and Electric Company, Southern California Edison Company, and San Diego Gas & Electric Company must each submit a Project Development Status Report, in a format prescribed by the Director of Energy Division, with their annual compliance reports.
36. The annual report submitted by a retail seller by August 1 of the year following the last year of a compliance period must include a separate section providing all the information required to determine compliance with all requirements for procurement under the California renewables portfolio standard established by this decision, or any other Commission decision, or requested by the Director of Energy Division for that compliance period, as well to determine the amount, if any, of excess procurement in that compliance period that may be applied to a later compliance period.
37. The Director of Energy Division is authorized to require retail sellers to submit supplemental reports or progress reports in addition to the annual compliance report.
38. A retail seller may request a waiver of the procurement quantity requirements set by Decision 11-12-020 only at the time the retail seller submits its annual report for the last year of the compliance period for which it seeks the waiver.
39. A retail seller may request a reduction of the portfolio balance requirements set by Public Utilities Code Section 399.16(c) only at the time the retail seller submits its annual report for the last year of the compliance period for which it seeks the reduction.
40. The Director of Energy Division is authorized to develop appropriate reporting formats and information requirements for all reports required to implement this decision.
41. The Director of Energy Division is authorized to require retail sellers to submit appropriate documentation, including but not limited to copies of renewables portfolio standard procurement contracts, to support the information in any report submitted in accordance with the requirements of this decision.
42. The Director of Energy Division is authorized, for good cause, to grant extensions of time to submit any reports or other documents required by this decision.
This order is effective today.
Dated June 21, 2012, at San Francisco, California.
MICHAEL R. PEEVEY
President
TIMOTHY ALAN SIMON
MICHEL PETER FLORIO
CATHERINE J.K. SANDOVAL
MARK J. FERRON
Commissioners
I will file a concurrence.
/s/ MICHEL PETER FLORIO
Commissioner
APPENDIX A
SELECTED RPS STATUTORY SECTIONS
Section 399.13(a)(3)
The commission shall direct each retail seller to prepare and submit an annual compliance report that includes all of the following:
(A) The current status and progress made during the prior year toward procurement of eligible renewable energy resources as a percentage of retail sales, including, if applicable, the status of any necessary siting and permitting approvals from federal, state, and local agencies for those eligible renewable energy resources procured by the retail seller, and the current status of compliance with the portfolio content requirements of subdivision
(c) of Section 399.16, including procurement of eligible renewable energy resources located outside the state and within the WECC and unbundled renewable energy credits.
(B) If the retail seller is an electrical corporation, the current status and progress made during the prior year toward construction of, and upgrades to, transmission and distribution facilities and other electrical system components it owns to interconnect eligible renewable energy resources and to supply the electricity generated by those resources to load, including the status of planning, siting, and permitting transmission facilities by federal, state, and local agencies.
(C) Recommendations to remove impediments to making progress toward achieving the renewable energy resources procurement requirements established pursuant to this article.
Section 399.13(a)(4)(B)
[The Commission shall adopt. . .] rules permitting retail sellers to accumulate, beginning January 1,2011, excess procurement in one compliance period to be applied to any subsequent compliance period. The rules shall apply equally to all retail sellers. In determining the quantity of excess procurement for the applicable compliance period, the commission shall deduct from actual procurement quantities, the total amount of procurement associated with contracts of less than 10 years in duration. In no event shall electricity products meeting the portfolio content of paragraph (3) of subdivision (b) of Section 399.16 be
counted as excess procurement.
Section 399.13(b)
A retail seller may enter into a combination of long- and short-term contracts for electricity and associated renewable energy credits. The commission may authorize a retail seller to enter into a contract of less than 10 years' duration with an eligible renewable energy resource, if the commission has established, for each retail seller, minimum quantities of eligible renewable energy resources to be procured through contracts of at least 10 years' duration.
Section 399.15(a)
In order to fulfill unmet long-term resource needs, the commission shall establish a renewables portfolio standard requiring all retail sellers to procure a minimum quantity of electricity products from eligible renewable energy resources as a specified percentage of total kilowatthours sold to their retail end-use customers each compliance period to achieve the targets established under this article. For any retail seller procuring at least 14 percent of retail sales from eligible renewable energy resources in 2010, the deficits associated with any previous renewables portfolio standard shall not be added to any procurement requirement pursuant to this article.
Section 399.15(b)
The commission shall implement renewables portfolio standard procurement requirements only as follows:
(1) Each retail seller shall procure a minimum quantity of eligible renewable energy resources for each of the following compliance periods:
(A) January 1, 2011, to December 31, 2013, inclusive.
(B) January 1, 2014, to December 31, 2016, inclusive.
(C) January 1, 2017, to December 31, 2020, inclusive.
(2) (A) No later than January 1, 2012, the commission shall establish the quantity of electricity products from eligible renewable energy resources to be procured by the retail seller for each compliance period. These quantities shall be established in the same manner for all retail sellers and result in the same percentages used to establish compliance period quantities for all retail sellers.
(B) In establishing quantities for the compliance period from January 1, 2011, to December 31, 2013, inclusive, the commission shall require procurement for each retail seller equal to an average of 20 percent of retail sales. For the following compliance periods, the quantities shall reflect reasonable progress in each of the intervening years sufficient to ensure that the procurement of electricity products from eligible renewable energy resources achieves 25 percent of retail sales by December 31, 2016, and 33 percent of retail sales by December 31, 2020. The commission shall require retail sellers to procure not less than 33 percent of retail sales of electricity products from eligible renewable energy resources in all subsequent years.
(C) Retail sellers shall be obligated to procure no less than the quantities associated with all intervening years by the end of each compliance period. Retail sellers shall not be required to demonstrate a specific quantity of procurement for any individual intervening year.
(3) The commission shall not require the procurement of eligible renewable energy resources in excess of the quantities identified in paragraph (2). A retail seller may voluntarily increase its procurement of eligible renewable energy resources beyond the renewables portfolio standard procurement requirements.
(4) Only for purposes of establishing the renewables portfolio standard procurement requirements of paragraph (1) and determining the quantities pursuant to paragraph (2), the commission shall include all electricity sold to retail customers by the Department of Water Resources pursuant to Division 27 (commencing with Section 80000) of the Water Code in the calculation of retail sales by an electrical corporation.
(5) The commission shall waive enforcement of this section if it finds that the retail seller has demonstrated any of the following conditions are beyond the control of the retail seller and will prevent compliance:
(A) There is inadequate transmission capacity to allow for sufficient electricity to be delivered from proposed eligible renewable energy resource projects using the current operational protocols of the Independent System Operator. In making its findings relative to the existence of this condition with respect to a retail seller that owns transmission lines, the commission shall consider both of the following:
(i) Whether the retail seller has undertaken, in a timely fashion, reasonable measures under its control and consistent with its obligations under local, state, and federal laws and regulations, to develop and construct new transmission lines or upgrades to existing lines intended to transmit electricity generated by eligible renewable energy resources. In determining the reasonableness of a retail seller's actions, the commission shall consider the retail seller's expectations for full-cost recovery for these transmission
lines and upgrades.
(ii) Whether the retail seller has taken all reasonable operational measures to maximize cost-effective deliveries of electricity from eligible renewable energy resources in advance of transmission availability.
(B) Permitting, interconnection, or other circumstances that delay procured eligible renewable energy resource projects, or there is an insufficient supply of eligible renewable energy resources available to the retail seller. In making a finding that this condition prevents timely compliance, the commission shall consider whether the retail seller has done all of the following:
(i) Prudently managed portfolio risks, including relying on a sufficient number of viable projects.
(ii) Sought to develop one of the following: its own eligible renewable energy resources, transmission to interconnect to eligible renewable energy resources, or energy storage used to integrate eligible renewable energy resources. This clause shall not require an electrical corporation to pursue development of eligible renewable energy resources pursuant to Section 399.14.
(iii) Procured an appropriate minimum margin of procurement above the minimum procurement level necessary to comply with the renewables portfolio standard to compensate for foreseeable delays or insufficient supply.
(iv) Taken reasonable measures, under the control of the retail seller, to procure cost-effective distributed generation and allowable unbundled renewable energy credits.
(C) Unanticipated curtailment of eligible renewable energy resources necessary to address the needs of a balancing authority.
(6) If the commission waives the compliance requirements of this section, the commission shall establish additional reporting requirements on the retail seller to demonstrate that all reasonable actions under the control of the retail seller are taken in each of the intervening years sufficient to satisfy future procurement requirements.
(7) The commission shall not waive enforcement pursuant to this section, unless the retail seller demonstrates that it has taken all reasonable actions under its control, as set forth in paragraph (5), to achieve full compliance.
(8) If a retail seller fails to procure sufficient eligible renewable energy resources to comply with a procurement requirement pursuant to paragraphs (1) and (2) and fails to obtain an order from the commission waiving enforcement pursuant to paragraph (5), the commission shall exercise its authority pursuant to Section 2113.
(9) Deficits associated with the compliance period shall not be added to a future compliance period.
Section 399.16(c)
In order to achieve a balanced portfolio, all retail sellers shall meet the following requirements for all procurement credited towards each compliance period:
(1) Not less than 50 percent for the compliance period ending December 31, 2013, 65 percent for the compliance period ending December 31, 2016, and 75 percent thereafter of the eligible renewable energy resource electricity products associated with contracts executed after June 1, 2010, shall meet the product content requirements of paragraph (1) of subdivision (b).
(2) Not more than 25 percent for the compliance period ending December 31, 2013, 15 percent for the compliance period ending December 31, 2016, and 10 percent thereafter of the eligible renewable energy resource electricity products associated with contracts executed after June 1, 2010, shall meet the product content requirements of paragraph (3) of subdivision (b).
Section 399.16(d)
Any contract or ownership agreement originally executed prior to June 1, 2010, shall count in full towards the procurement requirements established pursuant to this article, if all of the following conditions are met:
(1) The renewable energy resource was eligible under the rules in place as of the date when the contract was executed.
(2) For an electrical corporation, the contract has been approved by the commission, even if that approval occurs after June 1, 2010.
(3) Any contract amendments or modifications occurring after June 1, 2010, do not increase the nameplate capacity or expected quantities of annual generation, or substitute a different renewable energy resource. The duration of the contract may be extended if the original contract specified a procurement commitment of 15 or more years.
Section 399.16(e)
A retail seller may apply to the commission for a reduction of a procurement content requirement of subdivision (c). The commission may reduce a procurement content requirement of subdivision (c) to the extent the retail seller demonstrates that it cannot comply with that subdivision because of conditions beyond the control of the retail seller as provided in paragraph (5) of subdivision (b) of Section 399.15. The commission shall not, under any circumstance, reduce the obligation specified in paragraph (1) of subdivision (c) below 65 percent for any compliance obligation after December 31, 2016.
Section 399.21(a)(6)
A renewable energy credit shall not be eligible for compliance with a renewables portfolio standard procurement requirement unless it is retired in the tracking system established pursuant to subdivision (c) of Section 399.25 by the retail seller or local publicly owned electric utility within 36 months from the initial date of generation of the associated electricity.
(END OF APPENDIX A)
APPENDIX B
Sample Closing Calculations
B.1 Example Retail Seller that Procured Greater
than 14% in 2010 and has a "net deficit"
RPS Procurement and Targets (MWh) |
2003 |
2004 |
2005 |
2006 |
2007 |
2008 |
2009 |
2010 |
Bundled Retail Sales |
10,000 |
10,000 |
10,000 |
10,000 |
10,000 |
10,000 |
10,000 |
10,000 |
Total RPS Eligible Procurement |
1,300 |
1,300 |
1,300 |
1,300 |
1,300 |
1,400 |
1,500 |
1,900 |
Annual Procurement Target (APT) |
1,100 |
1,200 |
1,300 |
1,400 |
1,500 |
1,600 |
1,700 |
2,000 |
Incremental Procurement Target (IPT) |
N/A |
100 |
100 |
100 |
100 |
100 |
100 |
N/A |
Preliminary Procurement Surplus/(Deficit) |
200 |
100 |
0 |
(100) |
(200) |
(200) |
(200) |
(100) |
2010 Actual Procurement Percentage |
19% | |||||||
Surplus Procurement Bank Balance as of Prior Year |
200 |
200 |
300 |
300 |
200 |
0 |
0 |
0 |
Application of Banked Surplus Procurement to Current Year Deficit |
0 |
0 |
100 |
200 |
0 |
0 |
0 | |
Cumulative Surplus Procurement Bank Balance |
200 |
300 |
300 |
200 |
0 |
0 |
0 |
0 |
Net Surplus/(Deficit) |
200 |
300 |
300 |
200 |
0 |
(200) |
(400) |
(500) |
2010 Cumulative Deficit from Contracts Signed Prior to June 1, 2010 that may be Waived |
(500 ) | |||||||
B.2 Example Retail Seller that Procured Less
Than 14% in 2010 and has a "net deficit"
RPS Procurement and Targets (MWh) |
2003 |
2004 |
2005 |
2006 |
2007 |
2008 |
2009 |
2010 |
Bundled Retail Sales |
10,000 |
10,000 |
10,000 |
10,000 |
10,000 |
10,000 |
10,000 |
10,000 |
Total RPS Eligible Procurement |
1,100 |
1,300 |
1,400 |
1,500 |
1,400 |
1,500 |
1,500 |
1,000 |
Annual Procurement Target (APT) |
1,100 |
1,200 |
1,300 |
1,400 |
1,500 |
1,600 |
1,700 |
2,000 |
Incremental Procurement Target (IPT) |
N/A |
100 |
100 |
100 |
100 |
100 |
100 |
N/A |
Preliminary Procurement Surplus/(Deficit) |
0 |
100 |
100 |
100 |
(100) |
(100) |
(200) |
(1,000) |
2010 Actual Procurement Percentage |
10% | |||||||
Surplus Procurement Bank Balance as of Prior Year |
0 |
100 |
100 |
200 |
300 |
200 |
100 |
0 |
Application of Banked Surplus Procurement to Current Year Deficit |
|
0 |
0 |
0 |
100 |
100 |
100 |
0 |
Cumulative Surplus Procurement Bank Balance |
0 |
100 |
200 |
300 |
200 |
100 |
0 |
0 |
Net Surplus/(Deficit) |
0 |
100 |
200 |
300 |
200 |
100 |
(100) |
(1,100) |
2010 Cumulative Deficit from Contracts Signed Prior to June 1, 2010 that may be Carried Forward |
(1,100) | |||||||
B.3 Example Retail Seller that Procured
Greater than 14% in 2010 and has a "net surplus"
RPS Procurement and Targets (MWh) |
2003 |
2004 |
2005 |
2006 |
2007 |
2008 |
2009 |
2010 |
Bundled Retail Sales |
10,000 |
10,000 |
10,000 |
10,000 |
10,000 |
10,000 |
10,000 |
10,000 |
Total RPS Eligible Procurement |
1,300 |
1,300 |
1,500 |
1,500 |
1,000 |
1,800 |
1,800 |
1,900 |
Annual Procurement Target (APT) |
1,100 |
1,200 |
1,300 |
1,400 |
1,500 |
1,600 |
1,700 |
2,000 |
Incremental Procurement Target (IPT) |
N/A |
100 |
100 |
100 |
100 |
100 |
100 |
N/A |
Preliminary Procurement Surplus/(Deficit) |
200 |
100 |
200 |
100 |
(500) |
200 |
100 |
(100) |
2010 Actual Procurement Percentage |
19% | |||||||
Surplus Procurement Bank Balance as of Prior Year |
200 |
200 |
300 |
500 |
600 |
100 |
300 |
400 |
Application of Banked Surplus Procurement to Current Year Deficit |
0 |
0 |
0 |
500 |
0 |
0 |
100 | |
Cumulative Surplus Procurement Bank Balance |
200 |
300 |
500 |
600 |
100 |
300 |
400 |
300 |
Net Surplus/(Deficit) |
200 |
300 |
500 |
600 |
100 |
300 |
400 |
300 |
2010 Cumulative Surplus from Contracts Signed Prior to June 1, 2010 that may be Carried Forward |
300 | |||||||
B.4 Example Retail Seller that Procured
Less Than 14% in 2010 and has a "net surplus"
RPS Procurement and Targets (MWh) |
2003 |
2004 |
2005 |
2006 |
2007 |
2008 |
2009 |
2010 |
Bundled Retail Sales |
10,000 |
10,000 |
10,000 |
10,000 |
10,000 |
10,000 |
10,000 |
10,000 |
Total RPS Eligible Procurement |
1,300 |
1,300 |
1,500 |
1,500 |
1,800 |
1,800 |
1,800 |
1,000 |
Annual Procurement Target (APT) |
1,100 |
1,200 |
1,300 |
1,400 |
1,500 |
1,600 |
1,700 |
2,000 |
Incremental Procurement Target (IPT) |
N/A |
100 |
100 |
100 |
100 |
100 |
100 |
N/A |
Preliminary Procurement Surplus/(Deficit) |
200 |
100 |
200 |
100 |
300 |
200 |
100 |
(1,000) |
2010 Actual Procurement Percentage |
10% | |||||||
Surplus Procurement Bank Balance as of Prior Year |
200 |
200 |
300 |
500 |
600 |
900 |
1,100 |
1,200 |
Application of Banked Surplus Procurement to Current Year Deficit |
|
0 |
0 |
0 |
0 |
0 |
0 |
1,000 |
Cumulative Surplus Procurement Bank Balance |
200 |
300 |
500 |
600 |
900 |
1,100 |
1,200 |
200 |
Net Surplus/(Deficit) |
200 |
300 |
500 |
600 |
900 |
1,100 |
1,200 |
200 |
2010 Cumulative Surplus from Contracts Signed Prior to June 1, 2010 that may be Carried Forward |
200 | |||||||
(END OF APPENDIX B)
3. RECs Credited Towards the Compliance Period Procurement Quantity Requirement
Legend
3. RECs Credited Towards the Compliance Period Procurement Quantity Requirement
Legend
