STATE OF CALIFORNIA ARNOLD SCHWARZENEGGER, Governor
PUBLIC UTILITIES COMMISSION
505 VAN NESS AVENUE
SAN FRANCISCO, CA 94102-3298
March 2, 2004 Agenda ID #3313
Ratesetting
TO: PARTIES OF RECORD IN INVESTIGATION 00-11-001
RE: NOTICE OF AVAILABILITY OF PROPOSED DECISION ON INTERIM OPINION ON TRANSMISSION NEEDS IN THE TEHACHAPI WIND RESOURCE AREA
Consistent with Rule 2.3(b) of the Commission's Rules of Practice and Procedure, I am issuing this Notice of Availability of the above-referenced proposed decision. The proposed decision was issued by Administrative Law Judge (ALJ) TerKeurst on March 2, 2004. An Internet link to this document was sent via e-mail to all the parties on the service list who provided an e-mail address to the Commission. An electronic copy of this document can be viewed and downloaded at the Commission's Website ( www.cpuc.ca.gov).
This is the proposed decision of ALJ TerKeurst, previously designated as the principal hearing officer in this proceeding. It will not appear on the Commission's agenda for at least 30 days after the date it is mailed. This matter was categorized as ratesetting and is subject to Pub. Util. Code § 1701.3(c). Pursuant to Resolution ALJ-180, a Ratesetting Deliberative Meeting to consider this matter may be held upon the request of any Commissioner. If that occurs, the Commission will prepare and mail an agenda for the Ratesetting Deliberative Meeting 10 days before hand, and will advise the parties of this fact, and of the related ex parte communications prohibition period.
When the Commission acts on the proposed decision, it may adopt all or part of it as written, amend or modify it, or set it aside and prepare its own decision. Only when the Commission acts does the decision become binding on the parties.
Parties to the proceeding may file comments on the draft decision as provided in Article 19 of the Commission's "Rules of Practice and Procedure." These rules are accessible on the Commission's website at http://www.cpuc.ca.gov. Pursuant to Rule 77.3 opening comments shall not exceed 15 pages.
Consistent with the service procedures in this proceeding, parties should send comments in electronic form to those appearances and the state service list that provided an electronic mail address to the Commission, including ALJ Charlotte TerKeurst at msw@cpuc.ca.gov. Service by U.S. mail is optional, except that hard copies should be served separately on ALJ TerKeurst, and for that purpose I suggest hand delivery, overnight mail or other expeditious methods of service. In addition, if there is no electronic address available, the electronic mail is returned to the sender, or the recipient informs the sender of an inability to open the document, the sender shall immediately arrange for alternate service (regular U.S. mail shall be the default, unless another means - such as overnight delivery is mutually agreed upon). The current service list for this proceeding is available on the Commission's Web page, www.cpuc.ca.gov.
/s/ ANGELA K. MINKIN by PSW
Angela K. Minkin, Chief
Administrative Law Judge
ANG:hkr
Attachment
167895
ALJ/CFT/hkr DRAFT Agenda ID #3313
Ratesetting
Decision PROPOSED DECISION OF ALJ TERKEURST (Mailed 3/2/2004)
BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA
Order Instituting Investigation into Implementation of Assembly Bill 970 Regarding the Identification of Electric Transmission and Distribution Constraints, Actions to Resolve Those Constraints, and Related Matters Affecting the Reliability of Electric Supply. |
Investigation 00-11-001 (Filed November 2, 2000) |
(See Attachment A for List of Appearances.)
INTERIM OPINION ON TRANSMISSION NEEDS
IN THE TEHACHAPI WIND RESOURCE AREA
TABLE OF CONTENTS
Title Page
INTERIM OPINION ON TRANSMISSION NEEDS
IN THE TEHACHAPI WIND RESOURCE AREA 22
III. The Tehachapi Wind Resource Area 66
IV. Possible Configurations of a Tehachapi Transmission Project 88
V. Application of § 399.25 and Funding
of Tehachapi Transmission Upgrades 1010
VI. Transmission Planning for the Tehachapi Area 1717
VII. Comments on Proposed Decision 3131
VIII. Assignment of Proceeding 3131
ATTACHMENT A........................LIST OF APPEARANCES
INTERIM OPINION ON TRANSMISSION NEEDS
IN THE TEHACHAPI WIND RESOURCE AREA
I. Summary
The Tehachapi area contains the largest wind resource in California and, if more fully developed, could meet a significant portion of the goals for renewable energy development in California. However, existing transmission constraints in the area currently prevent new wind installations. Large-scale transmission upgrades capable of transporting power from multiple wind projects would be needed to tap the Tehachapi area's renewable potential most economically. We find that "business as usual" transmission planning approaches, which would plan and size Tehachapi transmission upgrades based solely on transmission needs of generation projects that have submitted interconnection requests, is unlikely to achieve the most cost-effective size, configuration, or timing of Tehachapi upgrades.
We require that a collaborative study group be convened to develop a comprehensive transmission development plan for the phased expansion of transmission capabilities in the Tehachapi area. The California Independent System Operator (ISO) and Commission staff should coordinate the study group, with participation by Southern California Edison Company (SCE), Pacific Gas and Electric Company (PG&E), wind developers, and any other interested parties. We encourage the California Energy Resources Conservation and Development Commission (CEC) to participate in the collaborative study process.
Each phase of the planned Tehachapi upgrades should be a logical size and configuration based on the magnitude of the identified wind resource, engineering and cost considerations, and recognition of other factors including regional transmission needs. Consistent with Pub. Util. Code § 399.251 and Decision (D.) 03-07-033, the relevant utility would fund all Tehachapi-related network transmission facilities that the Commission finds necessary to facilitate achievement of renewable power goals. While we ask the study group to address this matter, we envision that construction of each phase may be triggered by acceptance of a threshold amount of bids through the Renewable Portfolio Standard (RPS) process.
We require that SCE, acting on behalf of the study group, file a report in this proceeding within six months of the effective date of this order containing the study group's findings and recommendations. Parties may file comments and reply comments on the study group report. Based on the study group results, SCE should pursue ISO review of Tehachapi transmission upgrades and should file an application seeking a certificate of public convenience and necessity (CPCN) for the first phase of Tehachapi transmission upgrades consistent with the study group recommendations, no later than six months following submission of the study group report, unless further action in this proceeding relieves it of this obligation.
We are concerned that the problems with current transmission planning approaches may extend to the RPS process. As transmission cost adders are developed in this proceeding, transmission costs for Tehachapi wind generation projects should be based on logical, cost-effective transmission expansions rather than upgrades that are limited to the needs of specific projects that may bid in a particular year's RPS auction. Once a comprehensive transmission expansion plan is developed, transmission cost adders should be based on that plan. Transmission costs should be reflected on a pro rata basis in the rank ordering of individual bids. This approach will improve the reasonableness of Tehachapi transmission cost adders, make the RPS results more consistent across resource areas and over time, and avoid "free rider" problems.
1 All statutory references are to the Public Utilities Code.
