11. Contract Option for Facilities Less than 500 Kilowatts

In D.09-12-042, the Commission directed the parties to develop a streamlined contract for very small [less than 500 kilowatt (kW)] facilities within a set period of time. The Commission granted a request by the Joint Utilities to delay development of this contract until October 2010. Because of the delay in processing the two contracts approved in December 2009, and in light of the FERC Orders, the timing of this contract will also need to be updated.

The Amended Scoping Memo asked parities to respond to the following questions:

(1) What changes are required from the adopted contracts to make a less than 500 kW contract more streamlined?

(2) What changes, if any, are required in this contract to comply with the FERC Order?

CCDC, FCE, and SDG&E all list a number of contract provisions that can be streamlined for the under 500 kW contract option. PG&E suggests that interested parties meet to negotiate amendments to the streamlined contract to appropriately reflect the delivery potential and operating characteristics of facilities offering 500 kW or less of capacity. SCE points to the global QF Settlement and contends that the "very small" contract option is not necessary. SCE also raises a question regarding if the less than 500 kW refers to a facility's nameplate or exporting capacity. The Multijurisdictional Utilities argue that given their unique territories, the Commissions should not require them to adopt the very small contract.

11.1. Discussion

We will not address SCE's argument that the QF Settlement has replaced the need for a "very small contract," since, as previously mentioned, 1) we cannot pre-judge this as yet unapproved settlement, and 2) the settlement as proposed does not modify any item in this docket. SCE also seeks to clarify whether the 500 kW threshold that would be negotiated refers to nameplate or contract capacity. To clarify, consistent with the convention employed for both the contracts approved in D.09-12-042, this streamlined contract would be for facilities with a nameplate capacity less than 500 kW.

We agree with the proposal made by PG&E that the parties should work together to negotiate and propose a contract for this size point. Parties made several suggestions as to which items could be simplified to reach a contract appropriate for this size threshold. We suggest that prior to commencement of negotiations, Energy Division coordinate with the parties to host a workshop to develop a list of principles that would guide the development of the streamlined contract. Similar to the timeline considered in D.09-12-042, we expect that this contract would be developed within the next six months.