12. Comments on the Proposed Alternate Decision

Findings of Fact

1. The natural gas industry underwent considerable change in the 1980s and 1990s, with major policy changes occurring at both the federal and state level.

2. Several years ago, the Commission approved a CPCN for the first competitive gas storage facility, the Wild Goose facility in Butte County, to operate. The instant application is the second application for a CPCN to offer competitive gas storage services to be considered by the Commission.

3. LGS is a wholly-owned subsidiary of Western Hub Properties, LLC (WHP). Haddington Ventures, LLC (Haddington) formed WHP in 1998 to develop natural gas facilities, primarily in the western United States and Canada. WHP is presently owned by two limited partnerships, Haddington Energy Partners, L.P. and Haddington/Chase Energy Partners (WHP), L.P., respectively.

4. In the mid-1980s, and before forming Haddington Ventures, LLC, the three Haddington principals, Larry Bickle, John Strom and Chris Jones, formed and managed Tejas Power Corporation, which later became TPC Corporation (TPC). TPC was sold to PacifiCorp in the spring of 1997.

5. The LGS project management team, Mssrs. Dill (LGS' President) and Bergquist (a WHP Vice President) have substantial experience in the natural gas industry, including gas storage.

6. The Commission, through the Energy Division, determined that an EIR was required under CEQA, and caused a Draft and Final EIR to be prepared.

7. The final EIR consists of two separate documents, the Draft EIR and the Final EIR, which cumulatively make up the EIR, and are identified on the record as Reference No. 2.

8. Lodi Gas proposes to convert a depleted natural gas production field into a storage facility. The field LGS has chosen comprises about 1,450 acres, and is located approximately 5.4 miles, northeast of Lodi in San Joaquin County. For purposes of evaluating the project under CEQA, the "proposed project" identified in the EIR is the project formally presented in LGS' application as modified by the three amendments to the application and LGS' proposed mitigation measures. The EIR assumes that LGS will meet all the construction specifications and will complete all mitigation measures.

9. The project has the following principal components: the Lodi gas field, a field collection and water separation facility, a gas dehydration and compressor facility, approximately 33 miles of field and transmission gas pipeline, and two PG&E interconnect and meter stations.

10. Only the storage rights, and not the mineral rights, are required for the project. However, LGS is also seeking either the mineral rights to the property or consent and agreement of the mineral owners, in some instance limited to the specific zones to be utilized for natural gas storage. According to LGS, this is being done for two purposes: (1) to preclude another owner of the mineral rights from drilling into or through the storage reservoirs and causing damage or recovering the stored gas; and (2) to preclude claims that there exist remaining recoverable gas reserves in the storage reserves prior to injection of new gas.

11. LGS describes its own system capability as offering both firm and interruptible storage services and designed to accommodate an inventory of 12 Bcf of working gas, with a maximum firm deliverability of 500 MMcf/d and a maximum firm injection capability of 400 MMcf/d. This is part of LGS' project description and does not refer to PG&E's ability to transport gas to and from LGS.

12. LGS filed its initial application on November 5, 1998. Subsequently, LGS filed three amendments to the application, dated January 22, February 5, and April 29, 1999, respectively.

13. A January 7, 1999 ALJ ruling, inter alia, required LGS to serve a notice of availability of its application and the ruling on all owners of land, under, or on which the project may be located, and owners of land adjacent thereto. Because the third amendment to the application presented an alternative siting of the compressor station, LGS was also required to undertake similar service requirements as set forth above on landowners affected by the third amendment to the application.

14. Pursuant to Pub. Util. Code § 1701.3, the scoping memo designated ALJ Econome as the principal hearing officer.

15. Hearings on the non-environmental issues were held from June 14 through 16, 1999.

16. The parties presented closing argument before Assigned Commissioner Bilas, as well as the ALJ, on June 22, 1999.

17. The Commission held two public participation hearings in Lodi on October 19, 1999, where the public could comment on both the non-environmental issues and the Draft EIR.

18. Pursuant to Rule 8(d), parties were given until June 30, 1999, to submit a written request for final oral argument before the entire Commission. A July 16, 1999 ALJ ruling confirmed that no party submitted such a request, and that such argument would therefore not be scheduled or heard.

19. Altogether, the Commission held six days of hearings in this case (including the prehearing conference). Assigned Commissioner Bilas was present for three of those days.

20. On February 17, 1999, the Commission, through its Energy Division, notified LGS that its application had been deemed complete for purposes of Rule 17.1.

21. The Commission issued the Draft EIR in September 1999.

22. The Commission issued its Final EIR on February 15, 2000.

23. Two different regulatory schemes define this Commission's responsibilities in reviewing LGS' request for the approval of this application. Pub. Util. Code §§ 1001 et seq., require that before LGS can construct this project, the Commission must grant a CPCN on the grounds that the present or future public convenience and necessity require or will require construction of the project. Pub. Res. Code §§ 21000 et seq. (CEQA) require that the Commission, as lead agency for this project, prepare an EIR assessing the environmental implications of the project for its use in considering the request for a CPCN.

24. In 1992, the California Legislature formally expressed its objective of creating competition for natural gas storage services. The Legislature passed and the Governor approved AB 2744 (Chapter 1337 of the California Statutes of 1992, which is uncodified), which made certain findings about gas storage and urged certain action by the Commission. The Commission has summarized AB 2744 as not requiring, but urging, Commission action in the gas storage area.

25. In the 1993 Gas Storage Decision, the Commission adopted a "let the market decide" policy for gas storage. The Commission stated that it should not test the need for new gas storage projects on a resource planning basis, so long as all of the risk of the unused new capacity resides with the builders and users of the new facility.

26. In the Gas Storage Decision, the Commission stated that its "let the market decide" policy was consistent with Pub. Util. Code §§ 451 and 1001. However, the Commission also recognized that it was not abandoning regulation of gas storage, and that CPCNs were still necessary to the extent required by law.

27. Both the Commission and the Legislature have found the need for competitive gas storage facilities. LGS and Calpine reiterate and elaborate on the rationale underlying this need.

28. The benefits of competitive gas storage in California include (a) increased reliability; (b) increased availability of storage in California; (c) the potential for reduced energy price volatility; and (d) the potential for reduced need for new gas transmission facilities.

29. Under Pub. Util. Code § 1002, the Commission must consider the following factors in determining whether to grant a CPCN: (1) Community values; (2) Recreational and park areas; (3) Historical and aesthetic values; and (4) Influence on the environment. The obligation to consider the factors listed in § 1002 is independent of the Commission's obligation under CEQA. In addition to its CEQA obligations, Pub. Util. Code § 1002 provides the Commission with responsibility independent of CEQA to include environmental influence and community values in the Commission's consideration of a request for a CPCN.

30. In addressing whether the proposed project is compatible with community values, as set forth in Pub. Util. Code § 1002, we give considerable weight to the views of the local community. In addition, we acknowledge the positions of the elected representatives in the area because we believe they are also speaking on behalf of their constituents.

31. We cannot conclude based upon this record that it is reasonable that the existence of this project in close vicinity with the area's emerging wine tourism will damage the public's perception of the area's winegrape growing reputation.

32. Many of the impacts of the project are shorter-term construction-related. The EIR concludes that all but one can be mitigated to less than significant levels. The EIR also states that all of the project's long-term impacts can be mitigated to less than significant levels.

33. The Lodi community is divided about the project.

34. We cannot totally mitigate the community concerns to the level that we can find that this project is compatible with community values.

35. The community concerns can to some extent be mitigated if it is clear that LGS will have adequate liability insurance as well as a bond to ensure that LGS meets its project obligations.

36. The interconnection agreement between LGS and PG&E, attached to this decision as Attachment E, is reasonable for this proceeding.

37. There is no evidence that LGS currently possesses significant market power in the California gas storage market.

38. For the preferred alternative (the Composite Route Alternative), as well as the other alternatives, the EIR requires that the Commission make a statement of overriding consideration with respect to one significant and unavoidable impact identified in the EIR, construction-related ROG and NOx emissions in Sacramento County.

39. The EIR includes a detailed analysis of three alternative pipeline routes, which are technically feasible and acceptable to LGS, and were developed in response to public concerns during the scoping process regarding disruption of agriculture production and consistency with county and Delta Protection Commission policies regarding the consolidation of gas pipelines into transmission corridors.

40. The EIR determines that the Composite Route Alternative is the preferred alternative, largely because it has one less significant and unavoidable environmental impact than does the proposed project.

41. The EIR states that although use of the existing public right-of-way alternative may be preferable in some areas, in other areas this alternative route may run closer to residences than the original planned route.

42. East of Highway 5, the Existing Pipeline Corridor has greater impacts on private landowners because it does not follow the existing rights-of-way, as does the preferred alternative through most of that portion of the route.

43. LGS has stated that the Composite Route Alternative is now its preferred route and includes its preferred compressor facility location.

44. The EIR analyzes the environmental impacts, mitigation measures, and significance after mitigation under the following categories: (1) land use, planning, and agricultural resources; (2) population and housing; (3) geology, soil, and paleontology; (4) hydrology; (5) air quality; (6) transportation and circulation; (7) biological resources; (8) energy and mineral resources; (9) public health and safety; (10) noise; (11) public services and socioeconomics; (12) visual resources; and (13) cultural resources. The EIR determines that under its preferred alternative, all significant environmental impacts except one can be mitigated to a less than significant level. The EIR discusses the potential environmental impacts at a project-wide level, but does not consider the project's impacts on specific individual landowners.

45. The EIR identifies many of the project's potential significant effects that can be avoided or mitigated to a less than significant level. The EIR describes measures to avoid or mitigate such effects.

46. The Plans set forth in Attachments C and D to this decision substantially conform to the recommendations in the EIR for measures required to avoid or mitigate significant environmental effects of the project that can be avoided or mitigated.

47. The EIR has been completed in compliance with CEQA.

48. The EIR reflects the Commission's independent judgment and analysis on the issues addressed in the EIR, and the Commission has reviewed and considered the information in the EIR before issuing this decision on the project.

49. By enacting SB 177, the Legislature placed conditions on the ability of certain public utilities to exercise the power of eminent domain for purposes of offering competitive services.

Conclusions of Law

1. The July 20, 1999 motion of the Building and Construction Trades Council of San Joaquin, Calaveras, Alpine and Amador Counties for leave to withdraw as a party and for their lawfirm to enter an appearance for District Council No. 36 should be granted.

2. Pacific Realty's March 24, 2000 motion to withdraw from this proceeding should be denied because it was filed after the Commission has expended much time and resources on this proceeding. However, the Commission will consider the facts that Pacific Realty has settled its differences with LGS and now supports the application as supplementing its original testimony.

3. The EIR, which consists of two separate documents, the Draft EIR and the Final EIR, should be certified.

4. Because CPCNs are still necessary to the extent required by law, LGS' application must still comply with, inter alia, Pub. Util. Code § 1002. Also, if LGS only relies on the Gas Storage Decision for a presumptive showing of need, it may be difficult for the Commission to determine whether or not there is evidence to support a finding of overriding consideration, if necessary, with respect to the EIR that CEQA requires in this case.

5. The record has established a general need for competitive gas storage services in California.

6. The community concerns can to some extent be mitigated so that, in balancing community values with the other criteria set forth in Pub. Util. Code § 1002, the general need for and benefits of competitive gas storage facilities in California, and the outcome of the EIR, we can approve the project as conditioned herein.

7. As a condition to the CPCN, before construction begins until one year following the termination of the project operations, LGS should maintain a general liability policy of $1 million, as well as an umbrella policy in the amount of $50 million per occurrence. Furthermore, LGS should also provide a surety or performance bond in the amount of $20 million to cover the costs of meeting its obligations under this CPCN. These costs include, but are not limited to, reburial of the pipeline in the event of subsidence of the soil covering the pipeline, costs of restoring the area in the event of abandonment or bankruptcy, etc. The surety or performance bond should remain in effect until one year following the termination of project operations.

8. LGS should not begin construction on any aspect of the project until LGS first obtains: (1) a determination from the Airport Land Use Commission that the project is consistent with the local land use plan, or if not, until LGS has obtained an amendment to the plan to allow the project; and (2) all necessary permits from the California State Lands Commission.

9. The Commission's Energy Division should continue its outreach efforts during the construction phase of the project such as sending periodic newsletters to those persons served with notices regarding the EIR, and posting the monitoring reports on the Commission's web page at frequent intervals. To the extent that Energy Division requires a reasonable extension of the time stated in the EIR to conduct its review and monitoring activities, it has the authority to reasonably extend this period of time.

10. The interconnection agreement between LGS and PG&E, attached to this decision as Attachment E, should be approved.

11. Classification of standard and special facilities, and the principles of cost allocation for future interconnections, should be determined on a case-by-case basis. LGS should provide the Commission, in a supplemental filing, the final total cost of the interconnection including the cost paid by each entity.

12. LGS and PG&E should be required to have an operating and balancing agreement in place before LGS commences its operations. LGS should file this agreement with the Commission's Energy Division and serve it on all the parties to this proceeding.

13. LGS should be allowed to have market-based pricing because there is no evidence that LGS has significant market power.

14. LGS should not be required to cost justify its proposed rate ceilings or floors and should be allowed to charge market based rates within a filed rate zone.

15. LGS should file tariff rates within a rate window, but without cost justification.

16. Because LGS' rates should be market-based, ratepayers are not financing this project, and we do not have concerns regarding cross-subsidization by ratepayers, we should waive the cost cap requirement of Pub. Util. Code § 1005.5 for this application.

17. For purposes of evaluating the project under CEQA, the "proposed project" identified in the EIR is the project formally presented in LGS' application as modified by the three amendments to the application and LGS' proposed mitigation measures. The EIR assumes, and LGS should, meet all the construction specifications and complete all mitigation measures.

18. LGS should use the Composite Route Alternative for its pipeline route, which is the EIR's preferred alternative.

19. The EIR is based on the assumption that, and LGS should, operate its facilities within the parameters of the required permits, and that operations in excess of permitted levels should require LGS to obtain new discretionary permits and additional environmental review.

20. According to the EIR, one effect of the project, construction-related ROG and NOx emissions in Sacramento County, cannot be mitigated to a less than significant level and requires a statement of overriding consideration for the Commission to approve the project. This is one small issue in a project of this complexity, and addresses an geographic area other than that which was the focus of project opposition by the community. The EIR also recommends a best maintenance practice to address this issue. Because the statewide benefits of competitive gas storage facilities outweigh this one construction-related environmental impact of the project that cannot be mitigated to a less than significant level, we adopt a statement of overriding consideration on this one issue.

21. When considering the need for and the benefits of competitive gas storage facilities in California, as well as the criteria set forth in Pub. Util. Code § 1002, and the outcome of the EIR, we exercise our discretion and should approve LGS' application for a CPCN as further defined and conditioned in this decision.

22. With respect to each significant impact of the project that the EIR identifies as a significant impact that can be reduced to a level that is not significant, the mitigation, changes, or alterations should be required in, or incorporated into, the project to mitigate or avoid the significant impacts on the environment as a condition of this CPCN.

23. With respect to those changes or alterations identified in the immediately preceding Conclusion of Law that are within the responsibility and jurisdiction of another public agency, each such change or alteration has been, or can and should be adopted by that other agency.

24. With respect to any necessary state or local discretionary permits which LGS must obtain in order to construct the project, we clarify that the discretionary decision as to whether or not, or pursuant to what conditions, to issue the permits is at the sole discretion of the state or local entity.

25. The Draft Mitigation Monitoring Plan - Composite Route Alternative and the Draft Mitigation Monitoring Plan - Mitigation Measures Proposed by the Applicant, set forth in Attachments C and D to this decision, should be adopted in satisfaction of the requirements of Pub. Res. Code § 21081.6.

26. The Executive Director, or his designated staff or outside staff representative, should supervise and oversee construction of the project insofar as it relates to monitoring and enforcement of the mitigation conditions set forth in Attachments C and D to this decision.

27. The CPCN granted herein should be conditioned upon the adoption and implementation of the environmental mitigation measures set forth in the EIR and summarized in Attachments C and D to this decision.

28. If LGS makes any changes to the proposed route or other project components, LGS shall apply to the Executive Director or his designated staff for approval of a variance.

29. LGS should reimburse the Commission for the amount expended by the Commission for its expenses, including but not limited to special studies, staff, or Commission staff costs (including allocable indirect costs) directly attributable to in connection with mitigation monitoring.

30. In monitoring the implementation of the environmental mitigation measures described in the EIR and summarized in Attachments C and D to this decision, the Executive Director should attribute the acts and omissions of LGS' employees, contractors, subcontractors, or other agents to LGS.

31. LGS should follow the mandates of Pub. Util. Code § 625 before it exercises the power of eminent domain pursuant to Pub. Util. Code § 613.

32. The property required for LGS to construct and operate this project includes the storage, but not the mineral interests in the gas storage filed Therefore, LGS' power of condemnation includes the storage, but not the mineral interests in the gas storage field.

33. Decision 97-12-088, slip op. at p. 87, provides for review of the Affiliate Transaction Rules not later than December 31, 2000, and sooner if conditions warrant. LGS is put on notice that we intend the respondents in that proceeding to be all electric and gas utilities within our jurisdiction (including LGS), and the burden will be on the responding utilities to justify limited or partial exemption from the Affiliate Transaction Rules.

34. LGS' application for a CPCN authorizing it only to develop, construct, and operate the underground natural gas storage facility and ancillary pipeline, as set forth in its application and the Environmental Impact Report (EIR), with the pipeline routed along the Composite Route Alternative identified in the EIR as the preferred alternative, and to provide firm and interruptible storage services at market based rates, should be granted subject to the terms and conditions set in this decision.

ORDER

IT IS ORDERED that:

1. The Environmental Impact Report (EIR), which consists of two separate documents, the Draft EIR and the Final EIR, shall be certified.

2. Lodi Gas Storage, LLC (LGS) is granted a certificate of public convenience and necessity (CPCN) authorizing it to develop, construct, and operate the underground natural gas storage facility and ancillary pipeline, as set forth in its application, with the pipeline routed along the Composite Route Alternative identified in the EIR as the preferred alternative, and to provide firm and interruptible storage services at market based rates (the Project), subject to the terms and conditions set forth below.

3. Within 60 days of the effective date of this order, LGS shall file a written acceptance of the CPCN granted in this proceeding.

4. Before commencing its service to customers, LGS shall file with this Commission an advice letter and accompanying tariff schedules which will meet the criteria set forth in this decision, (i.e., LGS shall set forth proposed rate ceilings or floors and shall be allowed to charge market based rates within a filed rate zone), and which will comply with the criteria of the Commission's General Order 96-A, and other applicable Commission rules and procedures.

5. As a condition to the CPCN, before construction begins until one year following the termination of the Project operations, LGS shall maintain a general liability policy of $1 million, as well as an umbrella policy in the amount of $50 million per occurrence. Furthermore, LGS shall also provide a surety or performance bond in the amount of $20 million to cover the costs of meeting its obligations under this CPCN. These costs include, but are not limited to, reburial of the pipeline in the event of subsidence of the soil covering the pipeline, costs of restoring the area in the event of abandonment or bankruptcy, etc. The surety or performance bond shall remain in effect until one year following the termination of Project operations.

6. LGS shall not begin construction of any aspect on the project until LGS first obtains: (1) a determination from the Airport Land Use Commission that the project is consistent with the local land use plan, or if not, until LGS has obtained an amendment to the plan to allow the project; and (2) all necessary permits from the California State Lands Commission.

7. The Commission's Energy Division shall continue outreach efforts during the construction phase of the project such as sending periodic newsletters to those persons served with notices regarding the EIR, and posting the monitoring reports on the Commission's web page at frequent intervals. To the extent that Energy Division requires a reasonable extension of the time stated in the EIR to conduct its review and monitoring activities, it shall have the authority to reasonably extend this period of time.

8. The interconnection agreement between LGS and PG&E, attached to this decision as Attachment E, is approved. This approval is granted only for this facility. Before commencing its operations, LGS shall provide the Director of the Energy Division, in a supplemental filing, the final total cost of the interconnection including the share of the cost paid by each entity.

9. LGS and PG&E should be required to have an operating and balancing agreement in place before LGS commences its operations. LGS should file this agreement with the Commission's Energy Division and serve it on all the parties to this proceeding.

10. We adopt a statement of overriding consideration for one effect of the Project, the construction-related ROG and NOx emissions in Sacramento County, which cannot be mitigated to a less than significant level because the statewide benefits of competitive gas storage facilities outweigh this one construction-related environmental impact.

11. With respect to each significant impact of the project that the EIR identifies as a significant impact that can be reduced to a level that is not significant, the mitigation, changes, or alterations shall be required in, or incorporated into, the project to mitigate or avoid the significant impacts on the environment as a condition of this CPCN.

12. With respect to those changes or alterations identified in the immediately preceding Ordering Paragraph that are within the responsibility and jurisdiction of another public agency, each such change or alteration has been, or can and should be adopted by that other agency.

13. The Draft Mitigation Monitoring Plan - Composite Route Alternative and the Draft Mitigation Monitoring Plan - Mitigation Measures Proposed by the Applicant, set forth in Attachments C and D to this decision, shall be adopted in satisfaction of the requirements of Pub. Res. Code § 21081.6.

14. The CPCN granted herein shall be conditioned upon the adoption and implementation of the environmental mitigation measures set forth in the EIR and summarized in Attachments C and D to this decision, and LGS shall fully implement these mitigation measures.

15. The EIR is based on the assumption that, and LGS shall, operate its facilities within the parameters of the required permits, and that operations in excess of permitted levels will require LGS to obtain new discretionary permits and additional environmental review.

16. The Executive Director, or his designated staff or outside staff representative, shall supervise and oversee construction of the Project insofar as it relates to monitoring and enforcement of the mitigation conditions set forth in the EIR and as summarized in Attachments C and D to this decision. The Executive Director shall track and record direct expenses and time devoted to ascertain the costs of the monitoring mitigation measures to the Commission. The Executive Director is authorized to employ staff independent of the Commission staff to carry out such functions, including, without limitation, the on-site environmental inspection, environmental monitoring, and environmental mitigation supervision of the construction of the Project. Such staff may be individually qualified professional environmental monitors or may be employed by one or more firms or organizations. No person or organization shall be so employed who beneficially owns any security of, or has received during the past five years or is presently entitled to receive at any time in the future more than a de minimis amount of compensation for consulting services from LGS, or Western Hub Properties, LLC, Haddington Energy Partners, L.P., and Haddington/Chase Energy Partners, L.P.

17. In monitoring the implementation of the environmental mitigation measures described in the EIR and summarized in Attachments C and D to this decision, the Executive Director should attribute the acts and omissions of LGS' employees, contractors, subcontractors, or other agents to LGS. LGS shall comply with all orders and directives of the Executive Director concerning implementation of the environmental mitigation measures described in the EIR and summarized in Attachments C and D to this decision.

18. The Executive Director shall not authorize LGS to commence actual construction of the Project until LGS has entered into a cost reimbursement agreement with the Commission for the recovery from LGS of the costs of the mitigation monitoring program described in Attachments C and D to this decision, including but not limited to special studies, staff, or Commission staff costs (including allocable indirect costs) directly attributable to mitigation monitoring. The Executive Director is authorized to enter into an agreement with LGS that provides for such reimbursement on terms and conditions consistent with this decision in form satisfactory to the Executive Director. The Executive Director shall evidence his approval of such agreement by his Resolution. The terms and conditions of such agreement shall be deemed conditions of approval of the application to the same extent as if they were set forth in full in this decision.

19. Disputes concerning directives of the Executive Director to LGS during the course of actual construction of the Project shall be determined by the Executive Director, as evidenced by his Resolution. Any person aggrieved by any such Resolution may appeal to the Commission, pursuant to Rule 9(a) of the Commission's Rules of Practice and Procedure. The Executive Director's Resolution shall remain in full force and effect until affirmed, modified or vacated by the Commission.

20. The Executive Director shall file a Notice of Determination for the Project as required by the California Environmental Quality Act and the regulations promulgated pursuant thereto.

21. If LGS makes any changes to the proposed route or other project components, LGS shall apply to the Executive Director or his designated staff for approval of a variance.

22. If LGS seeks to expand or modify its physical facilities to the extent that discretionary approval by a public agency is required, it shall consult with the Commission prior to filing an application for such approval, so that the Commission may ensure that the appropriate environmental analysis of the impacts of LGS' specific proposal may be performed.

23. LGS shall follow the mandates of Public Utilities Code Section 625 before it exercises the power of eminent domain for this Project pursuant to Public Utilities Code Section 613.

24. Because the property required for LGS to construct and operate this Project includes the storage, but not the mineral interests in the gas storage field, LGS' power of condemnation shall include the storage, but not the mineral interests in the gas storage field.

25. Decision 97-12-088, slip op. at p. 87, provides for review of the Affiliate Transaction Rules not later than December 31, 2000, and sooner if conditions warrant. LGS is put on notice that we intend the respondents in that proceeding to be all electric and gas utilities within our jurisdiction (including LGS), and the burden will be on the responding utilities to justify limited or partial exemption from the Rules.

26. The July 20, 1999 motion of the Building and Construction Trades Council of San Joaquin, Calaveras, Alpine and Amador Counties for leave to withdraw as a party and for their lawfirm to enter an appearance for District Council No. 36 is granted.

27. Pacific Realty's March 24, 2000 motion to withdraw from this proceeding is denied. However, the Commission will consider the facts that Pacific Realty has settled its differences with LGS and now supports the application as supplementing its original testimony.

This order becomes effective 30 days from today.

Dated May 18, 1999, at San Francisco, California.

ATTACHMENT A

(3 pages)

ATTACHMENT B

(12 pages)

ATTACHMENT C

(22 pages)

ATTACHMENT D

(15 pages)

ATTACHMENT E

(6 pages)

TABLE OF CONTENTS

Title Page

OPINION ON LODI GAS STORAGE'S APPLICATION FOR A CERTIFICATE OF PUBLIC CONVENIENCE AND NECESSITY TO CONSTRUCT AND OPERATE A GAS STORAGE FACILITY 2

Title Page

Findings of Fact 68

Conclusions of Law 75

ORDER 81

Attachment A

Attachment B

Attachment C

Attachment D

Attachment E

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