5. Remedies
Settlement agreements play a very important role in our policy development at the Commission. When found to be reasonable in light of the whole record, consistent with the law, and in the public interest, settlements provide us with an alternate vehicle to often lengthy and costly litigation. Settlement agreements enable us to examine and to consider adoption of more creative and/or more streamlined solutions than may be readily available in a standard litigation process. We value the settlement process and support the good faith effort as well as time and resources that parties put into developing settlement agreements. The inherent value of a settlement is greatly diminished to the extent that the settling parties do not seek to uphold the letter and spirit of the agreement.
While we find that PG&E did violate Condition B of the Mariposa Settlement Agreement, we acknowledge that the filing of multiple applications, aside from requiring a consolidation process and coordination among Commission staff, did not hinder our ability to perform a thorough evaluation of each application on its own merits and together as part of our overall evaluation of PG&E's actions to fulfill its 2006 LTPP need authorization. Nothing presented in this petition suggests that our evaluation of these projects was short of thorough or complete and that our approval was not in the ratepayer interest. Therefore, we decline to open an adjudicatory phase in this proceeding to determine whether it is appropriate to penalize or fine PG&E at this time.
We note that as a result of PG&E's filing of three applications, parties intervening in our proceedings had to expend a significant outlay of time and resources that could have been avoided. Furthermore, this Commission has a strong preference for a simple and streamlined application process to "support decisional consistency and discourage parsing of projects into different applications as a means to circumvent our rulings..."12 Thus, while we decline to open an adjudicatory phase in this proceeding, it is reasonable to impose certain conditions on PG&E to avoid unnecessary outlay of parties' resources and to align with our preference for a streamlined procurement process. In the future, we strongly encourage PG&E to file the minimum number of applications possible to meet any future LTPP need authorization. However, we acknowledge that, in certain cases, there is value in bringing forth an application for approval of a particular PPA before PG&E has concluded negotiations of all PPAs resulting from a request for offers process. Therefore, in the event that multiple applications must be filed, PG&E is directed to cross-reference all other projects not included in a particular application, including referencing future applications that PG&E intends to file.
Finally, while PG&E's actions did not cause any direct harm to our evaluation process, we note that PG&E's actions may result in parties being wary of entering into a future settlement agreements of this nature, thus reducing or eliminating an extremely effective tool available to parties in resolving proceedings before this Commission. This is not a result we take lightly, and we hope that PG&E will consider more thoroughly its ability to meet its settlement obligations before signing such agreements in the future.
5.1. The Mariposa PPA Will Remain in Effect
In its petition for modification, CARE asks that the Commission stay or suspend PG&E's PPA with Mariposa LLC and provide sanctions or penalties against PG&E for violation of the Mariposa Settlement Agreement. DRA, in its reply to the January 28, 2011 ALJ Ruling, echoes this request.
We decline to stay or suspend the Mariposa PPA at this time because the Mariposa PPA was approved on its own merit in D.09-10-017.13 In fact, in making a finding that the Mariposa Settlement Agreement is in the public interest, we explicitly rely on the Independent Evaluator's determination that the Mariposa PPA "merits approval because the economics and general terms and conditions compare favorably to PPAs still under negotiations in the LTRFO solicitation."14 A stay or suspension of the Mariposa PPA would unnecessarily and unfairly harm Mariposa LLC for subsequent actions taken by PG&E. Both CARE and DRA have failed to show that, by violating the Mariposa Settlement Agreement, the value of the Mariposa PPA has been diminished and a reopening of the evaluation process is warranted. On this point, the November 8, 2011 Assigned Commissioner's Ruling states:
Each contract that comes before the Commission is considered on its own merits, and approved contracts are deemed to be in the public interest. Nothing in the record now before me suggests that the value to ratepayers of the projects approved in D.09-10-017, D.10-07-042, D.10-07-045, or in D.10-12-050 has changed.
Therefore, we deny CARE's petition for modification of D.09-10-017.
12 D.10-07-045, Conclusion of Law (COL) #7.
13 D.09-10-017 found that the Mariposa PPA is consistent with the requirements of D.07-12-052, including the preferred loading order and the need for dispatchable ramping resources. (COL # 4).
14 D.09-10-017 at 11.
