3. Substantial Contribution to Resolution of Issues

Under § 1804(c), an intervenor requesting compensation must provide "a detailed description of services and expenditures and a description of the customer's substantial contribution to the hearing or proceeding." Section 1802(h) states that "substantial contribution" means that,

in the judgment of the commission, the customer's presentation has substantially assisted the commission in the making of its order or decision because the order or decision has adopted in whole or in part one or more factual contentions, legal contentions, or specific policy or procedural recommendations presented by the customer. Where the customer's participation has resulted in a substantial contribution, even if the decision adopts that customer's contention or recommendations only in part, the commission may award the customer compensation for all reasonable advocate's fees, reasonable expert fees, and other reasonable costs incurred by the customer in preparing or presenting that contention or recommendation.

Section 1804(e) requires the Commission to issue a decision that determines whether the customer has made a substantial contribution and what amount of compensation to award. The level of compensation must take into account the market rate paid to people with comparable training and experience who offer similar services, consistent with § 1806.

As provided in § 1802(h), a party may make a substantial contribution to a decision in one of several ways. It may offer a factual or legal contention upon which the Commission relied in making a decision, or it may advance a specific policy or procedural recommendation that the ALJ or Commission adopted. A substantial contribution includes evidence or argument that supports part of the decision even if the Commission does not adopt a party's position in total.³

SSRC alleges it made a substantial contribution to each of the three main issues the Commission considered: reliability need, economic need, and environmental impact/alternative siting. We agree as to each issue, as we discuss below.

A. Reliability Need

With regard to reliability need, we agree with SSRC that the Commission decided at least 16 issues favorably to SSRC on this issue, and relied on SSRC's presentation in doing so.

SSRC's work on the following issues falls into this category: 1) whether the Commission is legally obligated to defer to the Independent System Operator's (ISO) determination regarding need; 2) the proper analytical approach to evaluation of the reliability need issue; 3) the appropriate time horizon within which to assess need; 4) whether the output of two existing generating units in San Diego owned by RAMCO should be included in the resource tally; 5) whether the output of two existing generating units in San Diego on Navy land should be included in the resource tally; 6) whether construction of new generation in San Diego would lead to the retirement of existing generation; 7) whether there is a standard industry practice for determining when to count the output from proposed new generation in a reliability analysis; 8) whether the output of the proposed and permitted Otay Mesa plant should be included in the resource tally for the reliability analysis; 9) the proper interpretation of Calpine's contract with the State of California; 10) how the Commission should address the potential availability of electricity from Sempra's Palomar Energy Project; 11) how the Commission should address the potential availability of electricity from additional RAMCO units; 12) how the Commission should address the potential availability of electricity from repowered generating units; 13) the impact of potential outages at the permitted Otay Mesa power plant; 14) whether electricity will flow through Mexico to San Diego in the case of certain outages; 15) determination of the appropriate demand forecast; and, ultimately 16) whether the Project was needed and whether SDG&E would have sufficient resources to meet its customer demand over the adopted planning horizon. On the reliability need issue, SSRC also contributed to the resolution of a number of procedural motions.

We agree with SSRC that it contributed substantially to the Commission's decision on reliability need.

B. Economic Need

On the economic need issue, SSRC's testimony provided a technical assessment of each of the economic rationales advanced for the Project by the ISO and SDG&E, and evaluated the reasonableness underlying SDG&E's expert analysis. SSRC's counsel cross-examined SDG&E's and the ISO's economic witness at the hearings and submitted approximately 31 pages of briefing on economic issues. The Commission's decision cites to and quotes at length from SSRC's contribution to the issue, quotes SSRC's evidence and expert analysis, and quotes SSRC cross-examination. SSRC also successfully contributed to several motions related to the economic need issue. We agree with SSRC that it contributed substantially to the Commission's decision on economic need.

C. Environmental Impact/Siting

On the issue of environmental impact and alternative siting, SDG&E opposes any award, and alternatively proposes a reduction. SSRC seeks to be compensated for over 400 hours for time spent addressing this issue. SDG&E states that because the Commission did not address environmental impact in its decision, SSRC did not make a substantial contribution on this issue.

We disagree with SDG&E's suggestion that SSRC may receive no compensation for work related to environmental/siting issues. As SSRC points out, the Commission initiated the environmental review process during Phase 1 of the proceeding. We held three scoping meetings in various locations near Temecula, which provided community members and other interested parties the opportunity to give input on environmental and siting issues. We also produced a preliminary analysis of alternatives during Phase 1, which cited SSRC's contributions.

We agree with SSRC that it is appropriate for it to seek compensation for its contribution to the Commission's interim environmental process and analysis of alternatives because the only opportunity for parties to participate in the process occurred during Phase 1. We also agree with SSRC that in order to be prepared for the potential second phase of the proceeding, it was necessary for SSRC to participate in the environmental review process that occurred during Phase 1 of the proceeding.⁴

On other occasions we awarded compensation for work on issues the Commission did not decide, on the ground that the parties could not have known ahead of time that the Commission would not reach their issues. For example, in D.02-07-030,⁵ we made clear that intervenors who make a substantial contribution to a proceeding should not be denied compensation if, through no fault of their own, the issue they address does not appear in the final decision because the Commission is able to dispense with the application at an earlier stage in the analysis. In that case, parties contributed substantially to the Commission's consideration of a merger that ultimately was called off by the companies proposing it, and we granted the parties compensation for their work in opposing the merger. We stated:

In our view, the fact that the merger was called off should not militate against an award of compensation. If we denied compensation for substantial efforts on transactions that--through no fault of the intervenor--were not consummated, we would discourage Intervenors . . . from participating in such proceedings. Every large and controversial transaction presents some risk of not being consummated by virtue of its very largeness and level of controversy . . . . Such large transactions are precisely the ones on which the Commission most needs the views of Intervenors . . . . We should encourage such participation in proceedings of this magnitude.

Similarly, in D.02-08-061, we found that an intervenor should receive compensation for work in a proceeding that we dismissed without considering certain matters of substance. We found that the intervenor could not have foreseen or affected the circumstances leading to the dismissal at the time it made its substantial contribution. There, as here, the intervenor acted responsibly in assuming the Commission would reach the issues at hand, and submitted testimony accordingly. The intervenor committed significant resources with a reasonable expectation that successful participation would eventually entitle it to receive an award of compensation.

Consistent with our findings in the foregoing cases, we will not deny SSRC compensation for its work on environmental and siting issues in this proceeding where it could not have known at the time it provided input on these issues that the Commission would deny the application before reaching them. Had we approved the transmission line, we would have needed SSRC's analysis, and SSRC should not be faulted for participating in a process we initiated during a period when it was unclear whether we would grant or deny the application.

We address the reasonableness of the compensation amount SSRC requests for environmental and siting issues in the next section.