COM/MP1/rg1/acb* ALTERNATE DRAFT Agenda ID #3667

Ratesetting

Agenda Item #67a 8/19/04

Decision ____________

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

In the Matter of the Application of Pacific Gas and Electric Company (U 39 E) for a Certificate of Public Convenience and Necessity Authorizing the Construction of the Jefferson-Martin 230 kV Transmission Project.

Application 02-09-043 (Filed September 30, 2002)

OPINION GRANTING A CERTIFICATE OF
PUBLIC CONVENIENCE AND NECESSITY

TABLE OF CONTENTS

Title Page

OPINION GRANTING A CERTIFICATE OF PUBLIC CONVENIENCE AND NECESSITY 1

I. Summary 2

II. Background 5

A. The Project and Environmentally Superior Alternatives 5

B. Procedural History 7

C. Motions Requesting Recirculation of FEIR 11

III. Overview of Positions of the Parties 17

IV. Project Need 21

A. Reliability Evaluation 22

1. Reliability Standards 22

2. Generation Capacity 24

3. Transmission Capacity 29

4. Distributed Generation, Energy Conservation, and Demand Response Programs 30

5. Load Forecasts 31

6. Parties' Reliability Need Analyses 33

B. Delay or the No Project Alternative 38

C. Discussion 40

V. Project Alternatives Studied 46

A. Southern Alternatives 46

1. Proposed Project--Southern Segment 46

a) Rebuild of Existing 60 kV Line 47

b) Transition to Northern Segment 49

2. Route Option 1B 52

3. Partial Underground Alternative and Modified Partial Underground Alternative 58

4. Hybrid Southern Alternatives 65

5. NPS Concerns 66

B. Northern Alternatives 70

1. Proposed Project-Northern Segment 71

2. Collocation Alternative 75

3. Undergrounding of Existing Lines into Martin Substation 80

4. San Bruno Mountain Alternative 82

C. Other Alternatives 84

VI. EMF Issues 86

A. Scientific Research Regarding EMF 87

B. EMF along Routes under Consideration 88

VII. Determination of Approved Route 91

A. Southern Segment 92

B. Northern Segment 97

VIII. Environmental Analysis 100

A. Mitigation and Mitigation Monitoring 101

B. Adequacy and Certification of the FEIR 107

IX. Consistency with Public Utilities Code Section 1002 109

X. Compliance with Public Utilities Code Section 625 110

XI. Project Costs 111

XII. Comments on the Proposed Alternate Decision 114

XIII. Assignment of Proceeding 117

Findings of Fact 117

Conclusions of Law 120

O R D E R 123

Attachment A - List of Appearances

Appendix A

Appendix B

OPINION GRANTING A CERTIFICATE OF
PUBLIC CONVENIENCE AND NECESSITY

I. Summary

This decision grants a certificate of public convenience and necessity (CPCN) to Pacific Gas and Electric Company (PG&E) to construct a new 230 kilovolt (kV) electric transmission line between PG&E's Jefferson substation and PG&E's Martin substation, along with related facilities. The facilities will be constructed in the County of San Mateo and will traverse or be adjacent to the towns of Hillsborough and Colma and the Cities of Brisbane, Daly City, San Bruno, and South San Francisco. A portion of the project will be within the San Francisco Public Utilities Commission (SFPUC) watershed near Interstate (I) 280. We adopt a maximum project cost of $206,988,000¹ for the authorized Jefferson-Martin project.

In order to shutdown the Hunters Point power plant Units 1 and 4, the record demonstrates that the 230 kV Jefferson-Martin project is needed in order to allow PG&E to continue to reliably meet electric demand in the San Francisco Peninsula Area. We expect Jefferson Martin to be in service by mid-2006. In addition, the project has diversification, economic, and environmental benefits that warrant its construction quickly. All major transmission lines importing power into San Francisco currently receive power from the East Bay and travel through a single corridor from the San Mateo substation to the Martin substation. The Jefferson-Martin project will help protect the San Francisco Peninsula from events disrupting supply at the San Mateo substation and/or along the San Mateo-Martin corridor. In addition, the project will tap power originating from south of the Peninsula area, thus diversifying the source of power. We find that the Jefferson-Martin project by itself is not sufficient to support closure of the Hunters Point power plant. However, a combination of the Jefferson-Martin project and additional transmission reinforcements north of the Martin substation and south of the Jefferson station would allow that plant to be closed, bringing additional economic and environmental benefits. For these reasons, the project is clearly necessary.

The proposed Jefferson-Martin project is characterized as having a southern segment and a northern segment, and the project could be configured in various ways through combinations of southern and northern route alternatives. In the southern segment, we choose a hybrid configuration that combines part of a southern underground alternative called Route Option 1B with a portion of PG&E's southern aboveground Proposed Project. Immediately north of the Jefferson substation, the authorized 230 kV Jefferson-Martin line will be located within Cañada Road and Skyline Boulevard, entirely underground except for an aboveground crossing of the Crystal Springs Dam. The underground line will transition to an aboveground configuration at a new intermediate transition tower west of Trousdale Drive. The 230 kV line will continue north on rebuilt towers and will be collocated with one circuit of an existing double-circuit 60 kV line. The aboveground 230 kV circuit will exit the SFPUC watershed at a new Glenview Drive transition tower, where it will connect to the underground northern segment.

The Final Environmental Impact Report (FEIR) identified the underground Route Option 1B to be environmentally superior in the southern segment, but we find that this hybrid configuration is preferable because it avoids Route Option 1B's effects on residences and businesses along Trousdale Drive and El Camino Real and is more consistent with the values and wishes of the communities along the route.

The FEIR identified two underground routes for the northern segment as both being environmentally superior, and we choose one of these routes, PG&E's Proposed Project with Route Option 4B, for the northern segment. From the Glenview Drive transition tower, this northern segment would be constructed beneath San Bruno Avenue and would turn north into Huntington Avenue to the BART right of way. This route may be modified slightly, depending on the preference of the City of San Bruno, to avoid a planned Huntington Avenue grade separation project. From the BART right of way, the 230 kV line would turn east into the new Lawndale Boulevard, north into Hillside Boulevard, east into East Market Street, which becomes Guadalupe Canyon Parkway and crosses San Bruno Mountain. Finally, the line would turn north on Bayshore Boulevard to the Martin substation.

On June 8, 2004, the Assigned Commissioner instructed that environmental review be undertaken of two route alternatives that did not receive full analysis in the FEIR. We choose not to supplement the FEIR, which already provides a reasonable range of alternatives. We instruct PG&E to begin construction on both sections.

The FEIR finds that the route as authorized for the southern segment and as authorized for the northern segment has no significant unmitigable (Class I) environmental impacts. Thus, no Statement of Overriding Considerations is needed. We adopt the mitigation measures proposed in the FEIR, with certain minor modifications that are included in an Addendum to the FEIR. We certify the FEIR and the Addendum.