8. Discussion
Section 851 of the Public Utilities Code provides that no public utility "shall...lease...[property] necessary or useful in the performance of its duties to the public...without first having secured from the [C]omission an order authorizing it so to do." The relevant inquiry for the Commission in Section 851 proceedings is whether the proposed transaction is "adverse to the public interest." (See, e.g., Universal Marine Corporation (1984) 14 CPUC2d 644.)
The proposed lease satisfies this test. The public interest is not harmed since the lease will not affect the utility's operation of the transmission lines. The Commission has determined that the public interest is served when utility property is used for other productive purposes without interfering with the utility's operation.3 Because the proposed agreement will increase the level of revenues SCE can obtain from secondary use of the land in question, with no additional ratepayer risk, the application should be approved.
In Resolution ALJ 176-3068, dated August 2, 2001, the Commission preliminarily categorized this proceeding as ratesetting and preliminarily determined that hearings were not necessary. Based on the record, we conclude that a public hearing is not necessary, nor is it necessary to alter the preliminary determinations in Resolution ALJ 176-3068.
Because the application is unopposed, and because our decision today grants the relief requested, the requirement for 30-day public review and comment is waived pursuant to Pub. Util. Code § 311(g)(2).
1. SCE is an electric public utility subject to the jurisdiction and regulation of this Commission.
2. SCE has property at the Walnut Substation in the City of Industry available for secondary use, and it seeks to obtain revenue for ratepayers and shareholders through a secondary use lease.
3. Subject to Commission authorization required under Pub. Util. Code § 851, SCE has negotiated a long-term lease of the property to provide lease revenues with no interference with the operation of the transmission lines.
4. The proposed lessee, Power Storage, is managed by principals with substantial experience in commercial and industrial projects, including self-storage facilities.
5. Power Storage will finance, construct and maintain a self-storage facility at the site, bearing the costs and making payments to SCE.
6. Revenue in excess of a Commission-established threshold will be shared 70/30 between the utility and ratepayers by treating all revenues as Other Operating Revenue, pursuant to D.99-09-070.
7. There has been no opposition to this application.
8. In D.01-08-022, issued August 2, 2001, the Commission announced a change in its procedure whereby it will require applicants to file lead agency CEQA documentation with their applications in cases of this kind.
9. This application was filed prior to the change in procedure announced in D.01-08-022.
1. No public hearing is necessary.
2. Joint use of utility property should be encouraged in appropriate cases because of the obvious economic and environmental benefits.
3. The Commission should condition its approval of the proposed lease on lessee's compliance with all applicable environmental regulations.
4. The Commission should require SCE within 120 days to provide the Commission with copies of the documents issued by the local entity acting as lead agency under CEQA to establish that the environmental review has been conducted.
5. SCE should be authorized pursuant to Pub. Util. Code § 851 to lease the designated 5.7-acre site to Power Storage on the terms and conditions set forth in the application.
6. The proposed sharing of revenues with ratepayers conforms to the Commission's order in D.99-09-070.
7. Because of the benefits of this lease agreement for the utility and for ratepayers, approval of this application should be made effective immediately.
IT IS ORDERED that:
1. Southern California Edison Company (SCE) is authorized to enter into a lease of a 5.7-acre site located on a portion of SCE's Walnut 220/12 kilovolt substation in the City of Industry under the terms and conditions set forth in this application.
2. As received, all revenues from the lease authorized shall be treated as Other Operating Revenue and shall be subject to the gross revenue sharing mechanism set forth in Decision 99-09-070.
3. Approval of this application is conditioned upon lessee's compliance with all applicable environmental regulations, pursuant to the California Environmental Quality Act (CEQA).
4. SCE shall notify the Director of the Energy Division, in writing, of any substantial amendments to, extension of, or termination of the lease agreement, within 30 days following the execution of such amendments, extensions or termination.
5. SCE shall within 120 days of the date of this order provide the Environmental Section of the Energy Division with copies of the documents issued by the local entity acting as lead agency under CEQA to establish that the environmental review has been conducted and any mitigation measures required by CEQA have been imposed, or that the project is exempt from CEQA pursuant to CEQA Guideline 15332.
6. Application 01-07-036 is closed.
This order is effective today.
Dated , at San Francisco, California.
3 In D.93-04-019, p. 3, we observed: "Joint use of utility facilities has obvious economic and environmental benefits. The public interest is served when utility property is used for other productive purposes without interfering with the utility's operation or affecting service to utility customers."
