8. Assignment of Proceeding

Michael R. Peevey is the assigned Commissioner and Melanie M. Darling is the assigned ALJ in this proceeding.

1. Joint Parties PG&E, RCEC, DRA, TURN, and CURE have filed a settlement agreement in the form of the 2nd APPA. The 2nd APPA resolves all of the disputed issues among the Joint Parties.

2. CARE, Simpson, and Group Petitioners oppose approval of the proposed settlement agreement.

3. PG&E, RCEC, DRA, TURN, and CURE fairly reflect a wide array of affected interests in this proceeding.

4. The 2nd APPA is a revision of the original Power Purchase Agreement executed by PG&E and RCEC that arose out of the PG&E's 2004 LTRFO process to acquire future capacity and ensure future reliability.

5. The Commission has previously determined the need for the project and that the 2nd APPA will satisfy that new resource need.

6. PG&E and RCEC renegotiated the PPA because of unforeseen permit delays and unexpected cost increases which have delayed the RCEC project start and on-line dates by two years.

7. An amendment to price from the original PPA is justified.

8. The increased costs claimed by RCEC have been independently verified.

9. The 2nd APPA has been independently reviewed and found comparable to current short-listed bids in PG&E's 2008 LTRFO.

10. The 2nd APPA represents a reasonable compromise of the parties positions such that not all settling parties agree with every provision, but taken as a whole each finds the totality reasonable.

11. The non-settling parties did not raise any contested issue of material fact.

12. The 2nd APPA provides an opportunity for PG&E's customers to receive 601 MW of power beginning in 2012, and PG&E elects to not use the CAM/Energy Auction for this resource.

13. The Commission has no jurisdiction over the siting and permitting of the RCEC project.

14. Group Petitioners did not establish they were a "customer" and otherwise qualified to claim intervenor compensation.

15. Group Petitioners established that a portion of their Comments are confidential and should be filed under seal.

16. PG&E timely filed a Motion to Offer Testimony into Evidence and a Motion to Seal the Evidentiary Record as to Revised Confidential Supplemental Testimony.

17. The RCEC project complies with the Emissions Performance Standard adopted in D.07-01-039.

1. The settlement agreement, represented by the 2nd APPA, meets the settlement requirements of Rule 12.1 in that it is reasonable in light of the whole record, consistent with law, and in the public interest.

2. The 2nd APPA should be approved.

3. Group Petitioners' Motion for Reconsideration of January 23, 2009 Ruling that Group Petitioners are not eligible to claim intervenor compensation should be denied.

4. Group Petitioners' Motion to Seal the Evidentiary Record as to Revised Confidential Supplemental Testimony should be granted in part, as set forth below.

5. PG&E's Motion to Offer Testimony into Evidence should be granted.

PG&E's Motion to Seal the Evidentiary Record as to Revised Confidential Supplemental Testimony should be granted as set forth below.

6. The designation of this proceeding should be changed so that hearings are no longer necessary.

7. This decision should be effective immediately so that the RCEC project can proceed expeditiously.

ORDER

IT IS ORDERED that:

1. The December 23, 2008 Joint Motion of Pacific Gas and Electric Company (PG&E), Russell City Energy Company, LLC, Division of Ratepayer Advocates, California Unions for Reliable Energy, and The Utility Reform Network for Approval of Second Amended and Restated Power Purchase Agreement (2nd APPA) is approved.

2. PG&E is authorized to recover costs associated with the 2nd APPA through its Energy Resource Recovery Account.

3. Group Petitioner's February 2, 2009 Motion for Reconsideration of the January 23, 2009 Administrative Law Judge Ruling that Group Petitioners are not eligible to claim intervenor compensation is denied.

4. Group Petitioners' Motion to Seal the Evidentiary Record as to Revised Confidential Supplemental Testimony is granted in part, as set forth below. Two portions of the "Confidential" version of Group Petitioners Comments shall be placed under seal as set forth in Ordering Paragraphs 6 and 7: Page 6, lines 15-21, and page 7, lines 12-19 (through the sentence ending in "letter").

5. PG&E's Motion to Offer Testimony into Evidence is granted.

6. PG&E's Motion to Seal the Evidentiary Record as to Revised Confidential Supplemental Testimony is granted as set forth in Ordering Paragraphs 6 and 7.

7. The material identified in Ordering Paragraphs 3 and 5 above shall remain under seal for a period of three years from the date of this order, except for data under category VII.B of Decision 06-06-066, which are confidential for three years from the date the contract states deliveries are to begin.

8. During the three-year period, the documents identified in Ordering Paragraphs 3, 5, and 6 shall not be made accessible or disclosed to anyone other than Commission staff except pursuant to (a) further order or ruling of the Commission, the assigned Commissioner, the assigned Administrative Law Judge (ALJ), or the ALJ then designated as Law and Motion Judge, or (b) the terms of a reasonable nondisclosure agreement for purposes of this proceeding.

9. Application 08-09-007 is closed.

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