II. Background

A. The Project and Environmentally Superior Alternatives

PG&E seeks a CPCN to construct a new 230 kV electric transmission line between PG&E's Jefferson and Martin substations. The major elements of PG&E's Proposed Project are:

· Installation of a new 27-mile 230 kV transmission circuit, comprised of 14.7 miles of overhead line to be installed on a rebuild of an existing 60 kV double-circuit transmission line (the southern segment), and 12.4 miles of new underground duct bank (the northern segment).

· Dismantling the existing 60 kV double-circuit tower line and rebuilding the towers to enable the east side to support a single 60 kV circuit and the west side to carry the new 230 kV circuit.

· Construction of a new transition station near the intersection of San Bruno Avenue and Glenview Drive to transition from the overhead to underground transmission segments.

· Modification of the existing Jefferson and Martin substations to accommodate the new 230 kV transmission line.

· Modification of equipment at the existing San Mateo, Ralston, Millbrae, Carolands, and Monta Vista substations, and the Hillsdale Junction switching station.

The Proposed Project would parallel I-280 for much of the southern segment, crossing Peninsula watershed lands owned by the City and County of San Francisco (CCSF). It would cross Edgewood County Park and Natural Preserve (Edgewood Park) and the Pulgas Ridge Open Space Preserve (Pulgas Ridge Preserve), and would pass near the San Mateo Highlands area of unincorporated San Mateo County and the Towns of Hillsborough, Burlingame, and Millbrae before entering the City of San Bruno.

The northern segment of the Proposed Project would route along San Bruno Avenue and the San Francisco BART right of way in the City of San Bruno, follow the BART right of way through the City of South San Francisco, and then route along a number of city streets through the Town of Colma, Daly City, and Brisbane to the Martin substation.

The proposed overhead segment of the 230 kV transmission line, collocated with the rebuilt 60 kV line, would be supported on lattice steel towers. The underground segment of the 230 kV circuit would consist of three cross-linked, polyethylene-insulated (XLPE) solid-dielectric, copper-conductor cables buried in a concrete-encased duct bank system. The transition station near San Bruno Avenue and Glenview Drive would be approximately 80 feet by 100 feet in size and enclosed by a masonry wall. Equipment at the transition station would include ground grid and conduit system, a 230 kV dead-end structure, a control building, and an underground vault.

The FEIR finds that the environmentally superior alternative comprises PG&E's southern Route Option 1B in conjunction with either the Proposed Project's northern segment or a northern alternative called the Collocation Alternative. In the southern segment, Route Option 1B would be entirely underground within roadways except for the crossing of the Crystal Springs Dam. It would follow Cañada Road and Skyline Boulevard along the I-280 corridor, turning east into Trousdale Drive and then north into El Camino Real. The FEIR describes several alternative crossings of Crystal Springs Dam that would be possible within the environmentally superior alternative.

In the environmentally superior alternative, the southern Route Option 1B would join either the northern segment of PG&E's Proposed Project or the Collocation Alternative at the intersection of El Camino Real and San Bruno Avenue. The FEIR states that the environmentally superior route in this area could be modified by Mitigation Measure T-9a, in which the route would continue north on El Camino Real past San Bruno Avenue, then turn east on Sneath Lane and (for the Collocation Alternative ) Tanforan Drive.

For the northern segment of PG&E's Proposed Project, the environmentally superior alternative would incorporate Route Option 4B, which would avoid Hoffman and Orange Streets by continuing north on Hillside (past Hoffman) and turning east on East Market Street.

As the second environmentally superior northern alternative, the Collocation Alternative would be located closer to the San Francisco Bay and would be routed through primarily commercial and industrial areas. It would use a portion of the route of an existing underground 230 kV transmission line through Brisbane, but would follow a new route segment through South San Francisco and adjacent cities. The FEIR includes in the environmentally superior Collocation Alternative four route options (Route Options A, D, E, and F) developed in response to comments on the draft EIR. We describe the Collocation Alternative in more detail in Section V.B of this order.

As the FEIR recognizes, the Commission considers other factors such as cost and timing of need along with the environmental information presented in the FEIR to make the ultimate determination regarding which route (if any) is to be approved.

B. Procedural History

PG&E and the ISO report that the genesis of the Jefferson-Martin project was a December 8, 1998 outage event, which triggered an evaluation of reliability in the San Francisco peninsula by a stakeholder group sponsored by the ISO. The stakeholder group evaluated six potential transmission projects: Jefferson-Martin 230 kV, Jefferson-Hunters Point 230 kV, Jefferson-Potrero 230 kV, San Mateo-Martin 230 kV, Moraga-Potrero 230 kV, and San Mateo-Martin #4 60 kV to 115 kV conversion. The Jefferson-Martin 230 kV line was selected over the San Mateo-Martin option largely on incremental reliability benefits resulting from additional diversification of the transmission grid.

This ISO stakeholder group recommended that PG&E initiate permitting activities of the Jefferson-Martin 230 kV line, "so that the project can be in place when needed, should the alternative solution of new generation not materialize." The ISO Board of Governors approved permitting activities for the Jefferson-Martin project in October 2000 and gave final approval for addition of the project to the ISO-controlled grid on April 25, 2002.

PG&E filed its application on September 30, 2002. With its application, PG&E supplied a Proponent's Environmental Assessment. The Commission, as Lead Agency, then retained outside consultants to conduct environmental review of the Proposed Project, pursuant to the California Environmental Quality Act (CEQA), and to examine alternatives, including the "No Project" alternative. The Commission's Energy Division oversaw the consultants' work.

A prehearing conference (PHC) was held on January 10, 2003. At the PHC, the United States Department of the Interior (DOI) stated its position that the Proposed Project is subject to the requirements of the National Environmental Policy Act (NEPA) because a portion of the project would traverse National Park Service (NPS) easements on San Francisco watershed land. As the lead federal agency for NEPA, DOI stated its preference that the Commission prepare a joint environmental document, combining NEPA and CEQA review. PG&E and CCSF stated that they do not believe that DOI has approval authority over the project or that NEPA compliance is required.

The Commission has not taken a position regarding whether DOI has federal jurisdiction over the proposed project. However, after meetings with DOI and other parties, Commission staff informed DOI on January 24, 2003 that it would not be feasible for the Commission to undertake the preparation of a joint CEQA/NEPA environmental document for the Jefferson-Martin project. Commission staff explained that at least three factors contributed to this decision: the ongoing dispute about whether the DOI has any federal jurisdiction related to the proposed project; the fact that DOI had not yet determined the scope or form of a federal NEPA document for the project; and the fact that expanding the scope of the CEQA review to comply with NEPA requirements would result in substantial delay in this proceeding. This discussion was also presented in the March 19, 2003 Scoping Memo and Ruling of Assigned Commissioner.

The Commission's Energy Division held four scoping meetings in January and February 2003 prior to selection of alternatives and preparation of the Environmental Impact Report. It attended eight consultation meetings with agencies and local jurisdictions to discuss the Proposed Project. The Draft Environmental Impact Report (DEIR) was released on July 16, 2003. The Commission provided for wide dissemination of and public input on the DEIR. The DEIR was mailed to 117 interested parties and agencies, made available on the Commission's website and in public libraries, and handed out on compact disk at the workshops and PPHs. The Commission oversaw the mailing of 8,764 notices of the availability of the DEIR. The Notice of Release was mailed to agencies, special districts, all owners and tenants of property located within 300 feet of the proposed and alternate project sites, and County Clerks' offices. Newspaper advertisements announced all public meetings. The Commission's Energy Division held four public informal workshops on the DEIR in San Bruno and San Mateo. PG&E was required to publish and post notice about, and arrange for print and electronic media coverage of and public service announcements regarding the four public hearings. The Final Environmental Impact Report (FEIR) was released in November 2003. It was made available at 14 repository locations and distributed to parties in the proceeding and to federal, State, and local governmental agencies that commented on the DEIR, as well as to some members of the public.

The assigned administrative law judge (ALJ) held six public participation hearings in the affected communities. Seventeen days of evidentiary hearings were held between January 12 and February 5, 2004. Several parties intervened in the proceeding and participated actively during the evidentiary hearings and subsequent briefing. These parties include the following: the Commission's Office of Ratepayer Advocates (ORA), the California Independent System Operator (ISO), the City of Burlingame, Daly City, the City of San Bruno City Council and Redevelopment Agency (City of San Bruno), the City and County of San Francisco (CCSF), the City of South San Francisco, the County of San Mateo, 280 Corridor Concerned Citizens (280 Citizens), CAlifornians for Renewable Energy (CARE), and Women's Energy Matters (WEM).² The City of Millbrae, Concerned Businesses East of 101 (CBE-101) and HMS Oyster Point, LLC, and Golden Gate Produce Terminal, Ltd. each sponsored a witness but did not file briefs. Genentech, Inc. (Genentech) did not participate actively in the evidentiary hearings but filed a reply brief. Numerous other groups and individuals participated in the environmental review process and commented on the DEIR, as described fully in the FEIR.

The evidentiary record was submitted on March 19, 2004 following receipt of late-filed exhibits and initial and reply briefs. The ALJ reopened the record for the receipt of load forecast information for the San Francisco Peninsula Area, as petitioned by the ISO, and for the receipt of additional information regarding construction along the BART right of way. The evidentiary record was resubmitted on June 4, 2004. We affirm the ALJ's ruling denying CARE and WEM motions for the receipt of additional evidence regarding biological impacts of trenching in serpentine grasslands and other matters.

Elsewhere in this decision, we address several motions and other procedural matters that occurred after the proposed decision was filed in this proceeding.

C. Motions Requesting Recirculation of FEIR

On December 15, 2003, the City of South San Francisco and CBE-101 filed a motion requesting that the FEIR be recirculated. PG&E filed a response to the motion.³ On January 9, 2004, Daly City submitted a joinder in the motion of South San Francisco and CBE-101.⁴ PG&E filed an opposition to Daly City's joinder, and Daly City filed a reply brief to PG&E's opposition.

South San Francisco and CBE-101 assert that recirculation is required because the discussion in the draft EIR of the Collocation Alternative was inadequate and because the six new route options developed for the Collocation Alternative in the FEIR constitute significant new information. They also state that recirculation would allow the Commission an opportunity to make clear whether the requirement that several environmental regulatory agencies evaluate and approve construction-related disturbance to contaminated sites would make infeasible the completion of the Collocation Alternative by the summer of 2005, as required by the project description.

We disagree with South San Francisco and CBE-101 regarding the need to recirculate the FEIR. The CEQA⁵ provision governing recirculation reads as follows:

When significant new information is added to an environmental impact report after notice has been given pursuant to Sections 21104 and 21153, but prior to certification, the public agency shall give notice again pursuant to Section 21092, and consult again pursuant to Sections 21104 and 21153 before certifying the environmental impact report. (Cal. Pub. Res. Code § 21092.1.)

South San Francisco and CBE-101 first challenge the adequacy of the draft EIR's discussion of the Collocation Alternative. The draft EIR laid out the route of the Collocation Alternative and identified and discussed its possible environmental impacts at length. Parties were able to, and did, submit extensive and substantive comments on the Collocation Alternative. We do not find that the draft EIR was "so fundamentally and basically inadequate and conclusory in nature that meaningful public review and comment were precluded." (CEQA Guidelines § 15088.5(a)(4).⁶)

We also disagree regarding the need to recirculate the FEIR based on the six new route options. An FEIR always contains new information not in the draft EIR, in the form of public comments and responses thereto. New information added to an EIR is not "significant" for purposes of triggering the recirculation requirement unless "the EIR is changed in a way that deprives the public of a meaningful opportunity to comment upon a substantial adverse environmental effect of the project." (CEQA Guidelines § 15088.5(a).)

The route options for the Collocation Alternative added in the FEIR do not constitute significant new information for which recirculation is required. The route options would move the Collocation Alternative route only slightly, at most only a block or two. While the parties point out that Route Option A would bore under roadways and the Colma Creek Tributary, the original Collocation Alternative proposed and the draft EIR described possible environmental impacts of the use of bores in similar conditions. The environmental impacts of Route Option E would be similar to, but less than, the impacts of the original Collocation Alternative. South San Francisco and CBE-101 describe the route options as having impacts due to "unstable fill soil" and moving underground construction work nearer to San Francisco Bay, but these are general characteristics of the Collocation Alternative that were identified and discussed in the draft EIR. We conclude that the six route options would not introduce "new significant environmental impacts" or a "substantial increase in the severity of an environmental impact," conditions which would require recirculation. (CEQA Guidelines §15088.5(a)(1) and (2).)

Nor do we see a need to recirculate the FEIR to address impacts of needed regulatory approvals on the feasibility of completion of the Collocation Alternative by the summer of 2005, one of the goals identified in PG&E's application. Noting that comments on the draft EIR identified that the Collocation Alternative would require permits from the County of San Mateo, the Bay Area Regional Water Quality Control Board and the Bay Conservation and Development Commission, South San Francisco and CBE-101 argue that the FEIR failed to analyze this issue adequately. In particular, they take issue with the allegedly conclusory statement that, "Regarding the concern that agency review of this alternative could lead to project delays, the CPUC believes that appropriate pre-construction planning and coordination by PG&E would allow this alternative to be implemented without delay" (FEIR, Vol. 3 at 662). They submit that recirculation would allow us another opportunity to address this issue.

We find that the FEIR adequately addressed permitting requirements for the Collocation Alternative. The FEIR estimated that it would take three to six months to acquire permits from the County of San Mateo and the Regional Water Quality Control Board and also identified the need for a permit from the Bay Conservation and Development Commission. The parties recognize that CEQA does not require recirculation due to an inadequate response to comments. Even assuming arguendo that the FEIR did not completely respond to comments in this regard, parties had adequate opportunity during the evidentiary hearing process to address the effect of regulatory permitting requirements on the completion date of the project. There is no need to recirculate the FEIR to cure any supposed shortcoming in this regard.

In its joinder, Daly City proposes that an alternative routing for the northern segment of the Proposed Project be developed and added to the FEIR and that the FEIR then be recirculated for comment. This alternative routing would collocate the new 230 kV line, in either an underground or overhead configuration, with the existing Jefferson-Martin 60 kV line over San Bruno Mountain. PG&E opposes Daly City's request as untimely and also contends that Daly City's new alternative is likely infeasible from regulatory and project timing perspectives.

Daly City explains that it is proposing study of this alternative comparatively late in the process because, initially, it was not aware that it could propose such alternative routes and, later, its concerns regarding proximity of the Proposed Project to Daly City schools were assuaged by the draft EIR's identification of the Collocation Alternative as the sole environmentally superior route. It is making its current proposal because the FEIR has now identified the northern portion of the Proposed Project, including Route Option 4B,⁷ as also environmentally superior and because several parties strongly object to the Collocation Alternative. Daly City states that its proposal is intended to "solve pitting schools, cities and businesses against one another" and asks that the Commission consider this alternative to "keep( ) peace in North San Mateo County."

As Daly City notes, in developing its Proposed Project PG&E considered an option that would rebuild the existing overhead line that traverses San Bruno Mountain but rejected it as infeasible due to land use conflicts and potentially significant adverse environmental impacts on San Bruno Mountain. No party suggested an alternative traversing San Bruno Mountain during the alternatives screening process, nor is such an alternative mentioned in the draft EIR or the FEIR.

As the FEIR notes, one of the most important aspects of the environmental review process is the identification and assessment of reasonable alternatives that have the potential for avoiding or minimizing the impacts of a Proposed Project. CEQA guidelines emphasize the selection and analysis of a reasonable range of feasible alternatives. At the same time, an EIR need not consider every conceivable alternative to a project. (CEQA Guidelines § 15126.6(a).) The FEIR contains full analysis of several alternatives for the northern segment of the Proposed Project. The Collocation Alternative would avoid all, and Route Option A of the Proposed Project would avoid most, of the impacts that Daly City fears for its schools. We find these alternatives, along with the other alternatives considered for the northern segment of the Proposed Project, to constitute a reasonable range of feasible alternatives, as required by the CEQA guidelines. As a result, it is not necessary to amend the FEIR as Daly City suggests or to recirculate the FEIR for comments on Daly City's suggested alternative. In Section VIII.B, we certify the FEIR as in compliance with CEQA.

D. Scope of Proceeding

In March 2003, the Assigned Commissioner found that the scope of this proceeding includes the following as to the proposed project using PG&E's preferred route and configuration, alternative routes and configurations, the No Project alternative, and non-wires alternatives:

· Need for the project (Pub. Util. Code § 1001), including consideration of the decision by the ISO that the project is needed to maintain system reliability.

· Consideration of the following factors contained in Pub. Util. Code § 1002:

1) Community values;

2) Recreational and park areas;

3) Historical and aesthetic values; and

4) Influence on the environment

· Consideration of whether, pursuant to General Order (G.O.) 131-D, the project promotes the safety, health, comfort, and convenience of the public.

· Consideration, pursuant to G.O. 131-D, of measures to reduce the potential exposure to electric and magnetic fields (EMFs) generated by the proposed facilities.

· Consideration, pursuant to the California Environmental Quality Act (Public Resources Code § 21000 et seq.), of significant effects on the environment of the project, alternatives to the project, the manner in which significant environmental effects can be mitigated or avoided, and whether economic, social or other conditions make it infeasible to mitigate significant effects on the environment.

· The appropriate planning horizon to use in evaluating need for the project.

· How PG&E will comply with Pub. Util. Code § 625.

· Effect on economic development.

· Impacts on the transmission grid and other transmission users.

· Cost effectiveness and cost allocation.

· Costs, and advisability and amount of a cap on project cost.

⁷ Daly City notes that Route Option 4B is immediately adjacent to two Daly City schools that would not be affected by PG&E's proposed Route Option 4A, although two other Daly City schools would be affected regardless of whether Route Option 4A or 4B is chosen.