Findings of Fact

1. PG&E, DRA, TURN, and CURE presented the Commission with a Joint Settlement Agreement concerning the acquisition, completion, and operation of CC8, including cost recovery and ratemaking mechanisms related thereto.

2. The Settlement Agreement contains Paragraph 11 that proposes a 30-year NBC for the project.

3. Protests to the Settlement Agreement were filed by MID, CCSF, and IEP but only to Paragraph 11.

4. IEP protested PG&E's presentation of the CC8 project to the Commission outside of a competitive solicitation process as established by D.04-12-048 and requested clarification on the Commission's preferred procurement policies. This issue was not within the scope of this proceeding, and we do not address it in this decision.

5. Following submission of the Settlement Agreement to the Commission, the scope of the proceeding was limited to a determination as to whether the Settlement, and especially Paragraph 11, is reasonable in light of the record as a whole, consistent with law, and in the public interest.

6. Previously in regards to specific projects for other IOUs, and in the Long-term Procurement decision, D.04-12-048, in regards to IOU projects in general, the Commission authorized a 10-year NBC for above-market costs for departing load.

7. The Settlement Agreement proposes a 30-year NBC, but defers all other issues, including the calculation, application and allocation of the NBC to another proceeding.

8. We find that the proposed 30-year NBC, with all of the implementation details left inchoate, is not reasonable in light of the record in this proceeding, is not consistent with law, and is not in the public interest.

9. We find it reasonable to modify the NBC to a 10-year period that will start when the plant begins commercial operations.

10. We find that CC8 is a low-cost and low-risk project that meets PG&E's long-term procurement needs and that will provide an additional 530 MW of electricity that will contribute to grid reliability.

11. The capital cost of the CC8 project compares very favorably with other projects recently approved by the Commission.

12. CC8 will provide needed capacity in northern California.

13. CC8's location near the heavy load concentration in the Bay Area is beneficial.

14. We find the Settlement Agreement, including the cost recovery and ratemaking mechanisms, for the acquisition, completion and operation of CC8, with the NBC amended to a 10-year period, to be reasonable in light of the record, consistent with law, and in the public interest.