3. CARE's Petition to Modify D.09-10-017
On October 11, 2010, CARE filed a petition for modification of D.09-10-017 claiming that PG&E has violated two key provisions of the Settlement Agreement. Responses to CARE's protest were timely filed by PG&E and DRA. At the time of filing of CARE's petition for modification, D.10-12-050, approving the Oakley Project with a new online date of 2016, had not yet been approved. On January 7, 2011, after approval of the Oakley project in D.10-12-050, then-assigned Administrative Law Judge (ALJ) Angela K. Minkin issued a ruling directing parties to comment on the impact of D.10-12-050 on CARE's petition for modification in this proceeding. CARE, DRA, and PG&E filed concurrent opening comments in response to the ALJ ruling on January 28, 2011, and the same three entities filed reply comments on February 18, 2011.
On October 18, 2011, assigned Commissioner Mark J. Ferron issued a ruling opening a new phase in this proceeding, preliminarily categorizing the proceeding as adjudicatory, setting a prehearing conference (PHC) for November 9, 2011, and requesting PHC statements from parties. Parties CARE and PG&E timely filed PHC statements on November 4, 2011; however, DRA did not file a PHC statement. In addition, Alliance for Retail Energy Markets, Communities for a Better Environment, and the Independent Energy Producers Association also filed PHC statements.7 On November 4, 2011, assigned ALJ Semcer sent an email to the service list canceling the PHC scheduled for November 9, 2011, and Commissioner Ferron issued a second Assigned Commissioner's Ruling on November 8, 2011 terminating the second phase in this proceeding, affirming the original categorization of ratesetting, and submitting the case as of November 4, 2011.
3.1. Summary of CARE's Petition to Modify D.09-10-017
In its petition for modification, CARE contends that PG&E has violated the Mariposa Settlement Agreement approved in D.09-10-017 because PG&E signed contracts to procure a total of 1,743 MW in new capacity from the 2008 LTRFO process. CARE explains that PG&E filed A.09-10-022 and A.09-10-034 seeking approval of 254 MW in upgraded PPAs and also filed A.09-09-021, in which PG&E sought approval of 1,305 MW from the Marsh Landing and Oakley PPAs. CARE therefore contends that PG&E knowingly violated D.09-10-017. CARE requests the Commission stay or suspend PG&E's PPA with Mariposa LLC, return this proceeding to its pre-settlement status, and provide sanctions or penalties against PG&E for violation of the Mariposa Settlement Agreement. In both its response to ALJ Minkin's January 7, 2011 ruling directing parties to comment on the impact of D.10-12-050 on CARE's petition for modification and its November 4, 2011 PHC statement, CARE maintains the above positions.
3.2. Responses to CARE's Petition
In its response, PG&E explains that it filed A.09-09-021, in which it requested approval of four PPAs from the 2008 LTRFO. The total new general resource MWs proposed in A.09-09-021 was 1,305 MW. At about the same time, PG&E filed A.09-10-022 and A.09-10-034, requesting approval of the Tracy and LECEF transactions. Both of these transactions included new PPAs for upgrades to the GWF Tracy Facility and the LECEF. PG&E maintains that the Upgrade PPAs at issue in A.09-10-022 and A.09-10-034 were not winning offers in the 2008 LTRFO process, but instead were proposed by PG&E as part of an overall approach to novation of contracts with the Department of Water Resources.
PG&E states that CARE raised the Mariposa Settlement in protests to both A.09-09-021 and A.09-10-022 (subsequently consolidated with A.09-10-034), but did not seek to reopen the Mariposa Settlement Agreement approved in D.09-10-017. PG&E contends that the petition for modification is untimely, is not based on new facts, and is prejudicial to both the Mariposa Energy Project and PG&E, since the developer has proceeded with the Mariposa Project. Moreover, PG&E maintains that it complied with the Mariposa Settlement Agreement because it filed a single application requesting approval of 1,305 MW of new generation related to the 2008 LTRFO process, and PG&E states that the 254 MW at issue in the Tracy and LECEF projects were not offered to meet the need identified in D.07-12-052, the LTPP decision. PG&E upholds these positions in all subsequent filings.
In it is initial response, DRA concurred with CARE in that PG&E had violated Condition B of the Mariposa Agreement because PG&E requested approval of a total of 1,743 MW in new generation, rather than the 1,512 MW approved in D.09-10-017, by the submission of three separate applications (A.09-09-021, A.09-10-022, and A.09-10-034). However, DRA explained that CARE's request for sanctions was premature, since, at that time, the Commission had approved only 1,157 MW in new generation related to the 2008 LTRFO process. In response to ALJ Minkin's January 7, 2011 ruling, DRA states that, while PG&E had clearly violated Condition B of the Mariposa Settlement Agreement, approval of the Oakley Project in D.10-12-050 results in PG&E violating Condition A by exceeding the maximum amount of resources PG&E was required to procure under the Mariposa Settlement Agreement. Therefore, DRA recommends the Commission impose severe sanctions against PG&E for violating the Mariposa Settlement Agreement including staying or suspending approval of the Mariposa PPA.
7 Commissioner Ferron granted party status to Alliance for Retail Energy Markets, Communities for a Better Environment, and the Independent Energy Producers Association on November 8, 2011. Mariposa Energy, LLC served a PHC statement on the service list on November 4, 2011 but failed to file a motion for party status; therefore, Mariposa Energy's PHC statement was rejected and is not part of the record in this case.
