Conclusions of Law

1. The interconnection application form should be adopted and monitored through a post-implementation working group to determine if additional changes are required.

2. We should adopt a limitation of liability clause in lieu of an indemnity provision in the interconnection agreement.

3. The increases in minimum liability insurance requirements are reasonable based on inflation since 1983 and in comparison to levels of insurance typically carried by homeowners.

4. The Interconnection Agreement as recommended by the Energy Commission should be approved with the addition of the following language: "EP authorizes to release to the California Energy Commission (CEC) information regarding EP's facility, including customer name, location, size, and operational characteristics of the unit, as requested from time to time pursuant to the CEC's rules and regulations."

5. The testing and certification language recommended in Appendix B of the Supplemental Recommendation should be adopted.

6. The initial and supplemental review fees recommended by the Energy Commission should be adopted as the maximum fees for applicants qualifying for initial and supplemental review.

7. If we adopt an adjustment to the fees, such adjustment should be applied prospectively to interconnection initiated following the effective date of the fee revision.

8. Post-implementation work should consider whether utility specific language is needed in Rule 21.

9. Establishment of a post-implementation working group is a prudent and effective way to provide an opportunity for ongoing evaluation of implementation issues under the new rule and potential revisiting of areas of concern.

10. By adopting clear standards to facilitate interconnection of new, small scale generating facilities, we take a step towards relieving California's electricity supply constraints and encouraging self-generation consistent with the directives of AB 970.

11. The Rule 21 language recommended by the Energy Commission on October 25, 2000 should be adopted in its entirety.

12. It is reasonable to adopt the Rule 21 Model Tariff for all respondent utilities because our goal is to apply the same interconnection standard on a statewide basis. There may be compelling reasons why smaller utilities or those utilities with limited California operations may not be able to comply with this standard. Therefore, it is reasonable to allow Sierra, Pacificorp, Mountain Utilities, and Bear Valley Electric to either file a compliance advice letter adopting the model tariff or a compliance filing in this docket showing compelling reasons why the adopted rule should not apply to them.

ORDER

Therefore, IT IS ORDERED that:

1. Pacific Gas and Electric Company, San Diego Gas & Electric Company, and Southern California Edison Company shall file, within 15 days of the effective date of this order, compliance advice letters to revise Rule 21 of their tariffs consistent with Attachments A and C. Attachment B shall be revised consistent with Conclusion of Law 4. The advice letters shall be effective upon filing, subject to Energy Division determining that they are in compliance with this Order.

2. Within 40 days of the effective date of this order, Sierra Pacific Power Company, Pacificorp, Mountain Utilities, and Bear Valley Electric shall either file a compliance advice letter adopting the Model Tariff, Interconnection Application Form and Agreement, or a compliance filing in this docket demonstrating compelling reasons why the adopted rule should not

apply to them. If filed, advice letters shall be effective upon filing, subject to Energy Division determining that they are in compliance with this Order.

This order is effective today.

Dated December 21, 2000, at San Francisco, California.

LORETTA M. LYNCH

President

HENRY M. DUQUE

JOSIAH L. NEEPER

RICHARD A. BILAS

CARL W. WOOD

Commissioners