9. Discussion of Project Need
We have provided an extensive discussion of the capacity of the existing system and PG&E's load forecasts. No party besides PG&E prepared an independent need forecast for the Tri Valley area. Parties generally took on face value the statement that additional transmission capacity is needed in the Tri Valley area. However, the FEIR recommends no project for North Livermore or Phase 2. Because no party challenged PG&E's load forecasts, we lay out the record as we understand it, and independently analyze whether all elements of PG&E's proposed project are needed.
It is clear that additional capacity is needed in the Tri Valley area to serve its growing load. Although the record is not entirely consistent regarding the capacity of the system in 2002, it is clear that PG&E's forecasted peak load for 2002 exceeds installed capacity.30 Even assuming that short term growth declines by 10% due to the economic downturn or conservation efforts, existing facilities are at capacity. The record is clear that capacity at the Vineyard Substation must be expanded. As articulated by PG&E's witness Pearson,
" . . . there is approximately 100 megawatts of load that's currently fed from San Ramon that should be fed from Vineyard Substation, . . ." (PG&E: Pearson, RT 248.)
Freeing up capacity at the San Ramon Substation will allow it to serve new load nearby, specifically from the Bishop Ranch Business Park and the Gale Ranch and Windemere residential developments that are located in the San Ramon area. Right now, load in Dublin is served by distribution feeders from San Ramon Substation, but is generally located more than four miles southeast of the San Ramon Substation. Growth is generally occurring on the southern and eastern end of Dublin, so serving Dublin's load from San Ramon Substation would require longer distribution feeders than PG&E's distribution planning guidelines allow for. Load in Dublin could be served by the Vineyard Substation which is located about 4 miles south of the center of Dublin's growth area but again, some longer distribution feeders would be required. In addition, demand in Dublin is growing rapidly. The record supports construction of a new substation in Dublin.
The record also supports the need for a new substation in North Livermore. Witness Pearson indicated that, like San Ramon Substation, the Las Positas Substation is also serving some load that could be served by Vineyard Substation. (PG&E: Pearson, RT 259.) Increased capacity of Vineyard Substation should free some of this capacity to serve growth in the Livermore/Las Positas DPA. Existing demand in this DPA is also generally located south of I-580, with the city center being located about 2 miles south of I-580. Growth in the Livermore/Las Positas DPA also is primarily in southern Livermore. Measure D has called into question whether growth in North Livermore will occur within a reasonable planning horizon.
On June 6, 2001, PG&E filed a motion seeking official notice of certain planning documents regarding additional development in the northern and eastern Livermore areas. The Exhibit A documents, regarding the Vasco/Laughlin Specific Plan, do not include any information about when, or by whom the document was produced, its status (approved, pending, or still being developed), or the potential timeframe for any construction. We note that at least a portion of the document has been available since 1988. Regarding the Exhibit B documents, pertaining to industrial, commercial, and business park development, no timeline for the projects is identified. The included map does not identify streets which would allow for an easy understanding of where various parcels are located compared to various substation locations. After comparing the map with other exhibits in this proceeding what becomes clear, is that new development is expected to take place within four miles from the location of PG&E's proposed North Livermore substation and additional development is likely to occur in areas that are much closer to the existing substations of Vasco, Livermore, and Las Positas. There is considerable overlap in the 4 mile spheres of influence of the proposed North Livermore substation and the existing Las Positas substation.
Construction of a substation in North Livermore will enable PG&E to use the new substation to serve existing and new load within its sphere of influence while relieving much of the load that otherwise would be born by Las Positas, enabling that substation to serve the bulk of the expected new development.
In order for a significant amount of newdevelopment to occur in the North Livermore area, the area would need to be annexed by the City of Livermore or another city. Cal. Gov. Code § 56017 (Deering's 1987) provides "'[a]nnexation' means the annexation, inclusion, attachment, or addition of territory to a city or district." Annexation is the means by which an existing city extends its corporate boundaries.
The Cortese-Knox Act (Cal. Gov. Code §56000 et seq.), passed in 1985, sets the framework within which proposed city annexations, incorporations, consolidations and special district formations are considered. The Cortese-Knox Act establishes a Local Agency Formation Commission (LAFCO) for each county, empowering it to review, approve or deny proposals for boundary changes and incorporations for cities, counties and special districts. The Legislature sets guidelines for the actions LAFCOs can take, providing statewide policies and priorities for the consideration of annexation (Cal. Gov. Code §56844). The Cortese-Knox Act mandates specific factors that a LAFCO must address when considering annexation proposals. LAFCOs establish the ground rules by which the annexation will be processed. There are several steps to annexation.
First, an application may be filed with the LAFCO by petition of affected landowners, registered voters or by resolution from the involved city. Prior to filing, the annexation proponent should meet with the LAFCO's executive officer to establish the minimum requirements for processing, then meet with any affected special districts and agencies to agree upon a taxation scheme and needed property tax transfers. LAFCO action is subject to CEQA and an initial study is required.
The LAFCO then has 30 days to review an annexation application and determine its completeness. The executive officer is prohibited from issuing a certificate of filing if an agreement establishing the allocation of property tax revenues has not been reached during the 30-day review period. A certificate of filing is a precondition to a LAFCO hearing on an application for annexation. If the application is determined to be complete the LAFCO will issue a Certificate of Filing setting the LAFCO hearing within 90 days. The hearings may be continued for up to 70 days. The LAFCO will analyze the proposed annexation in light of its state mandated evaluation criteria and responsibilities and its own adopted policies. Following the hearings, LAFCO will issue a resolution. The consequent conditions set by the LAFCO's resolution will be the ground rules for the Conducting Authority's subsequent action (Cal. Gov. Code §56851).
The involved city, acting as the "Conducting Authority" will hold a public protest hearing, unless the proceedings are waived, to determine whether the proposed annexation may be approved without an election, terminated, or whether an election must be called to determine the proposal's outcome. The number of protests received before and during the hearing will determine which of these options the city must follow. If the annexation is approved, the city will forward a resolution containing the results of its activities to the LAFCO for final review and ratification. If the proposal is terminated, a resolution to this effect will be forwarded to the LAFCO and no new annexation may be proposed on the site for at least one year, unless the LAFCO waives the limitation upon finding that the limitation is detrimental to the public interest (§ 56855 and §56851). When an election is held, only residents of the proposed city or territory have a right to vote on the issue of annexation (§ 57103 and Board of Supervisors v. LAFCO, 3 Cal. 4th 903, 924 (1992)).
LAFCO may approve, conditionally approve or deny the proposed annexation. Within 30 days of the LAFCO's resolution, any person or affected agency may file a written request with the executive officer for reconsideration of the annexation proposal (Cal. Gov. Code §56857).
Under the relevant timelines, once an annexation application is submitted, processing of the application would be expected to take somewhere between 6 and 12 months, assuming no election is required. However, an applicant must prepare environmental documents, prior to submitting an application to start this clock.
The record supports a conclusion that there is a need for additional capacity south of I-580, given the current capacity of the Livermore-Las Posital DPA and forecasted growth. The question then becomes, would construction of a substation in unincorporated Alameda County, as proposed by PG&E, assist PG&E in serving this new demand?
Based on the development currently expected (see Exhibit 10 and PG&E's June 6, 2001 Motion), PG&E could construct a new substation south of I-580 in the southern or western portion of the city or to expand existing substations to meet this need. However, construction of the proposed substation in North Livermore would relieve Las Positas to serve much of the new demand. In addition, it would enable PG&E to more readily serve the North Livermore Specific Plan development, if it were to gain final approval. Thus, the North Livermore substation will not only help serve existing and expected load; it will provide PG&E with a flexible tool with which to serve future development in the area.
PG&E remains the only party advocating approval of Phase 2 of the project. As described in Exhibit 1001, power flow studies performed by the ISO, in conjunction with PG&E, show that additional service from the Tesla Substation is not likely to be necessary due to transmission system improvements that are underway or expected. The ISO takes no position on whether we should grant a CPCN for Phase 2 because it is not needed until 2009. As the ISO says, "[i]t is possible that closer to the date when Phase 2 is needed, other alternatives will be available and preferable." (ISO Opening Brief, p.5.) PG&E has not demonstrated the public convenience and necessity of Phase 2 of its proposed project.
There is an adequate record to support the conclusion that the remainder of Phase 1 of the project is needed pursuant to Pub. Util. Code § 1001. Therefore, we should grant a CPCN to PG&E to construct new substations to serve Dublin and North Livermore and new 230 kV transmission facilities to connect the new Dublin and North Livermore substations to the existing Contra Costa-Newark transmission line. We will address the location and routing of the approved project in the next section.
