8. Comments on Proposed Decision
The proposed decision of the Assigned Commissioner in this matter was mailed to the parties in accordance with Section 311 of the Public Utilities Code and comments were allowed under Rule 14.3 of the Commission's Rules of Practice and Procedure. Comments were filed on November 19, 2009 by SCE, jointly by SDG&E and SoCalGas, jointly by PG&E and TURN, PacifiCorp, BVES, EPUC, Sierra Pacific, San Joaquin Refining Co. (SJRC), Fuel Cell, CCDC, DRA and AReM. Reply comments were filed on November 24, 2009 by SCE, SDG&E, PG&E/TURN, CCDC, AReM, Fuel Cell and SJRC. This decision has been revised in response to comments as appropriate.
In comments, PG&E/TURN and SCE have asserted that the Commission's pricing determination is unlawful. These arguments essentially rely on the FERC's rulings in Midwest Power Systems Inc. (1997) 78 FERC ¶ 61,067 (Midwest) and Southern California Edison Company and San Diego Gas & Electric Company (1995) 71 FERC ¶ 61,269 (SCE). This reliance is misplaced. Midwest held that orders of state agencies were preempted by PURPA to the extent that they require utilities to purchase power generated by QFs at rates above avoided costs. Midwest also found that the orders of the Iowa Utilities Board were inconsistent with the FPA to the extent they set rates charged by public utilities for wholesale sales even if utilities were not QFs. However, as we have already explained in this decision, the purpose of AB 1613 is to encourage the development of more efficient CHP systems that would provide environmental benefits. Neither PURPA nor the FPA address environmental issues, such as GHG emissions. Indeed, both Midwest and SCE stated that outside of PURPA, it would be consistent with federal law for states to meet their environmental goals by directing the planning and resource decisions of electric utilities under their jurisdiction or by encouraging certain alternative generation through tax incentives or other subsidies.97
97 Midwest, 78 FERC ¶ 61,067 at 61,248; SCE, 71 FERC ¶ 61,269 at 62,080.
