7. Forum for Review of Spot Market Transactions
SCE states that it is required to demonstrate that spot market transactions comply with its adopted procurement plan in both the ERRA (for dispatch) and the quarterly procurement advice letter process (for matters other than dispatch), and requests that the review be combined in one forum, preferably the quarterly procurement advice letter process. ORA recommends that SCE's request be rejected, stating that a meaningful review of dispatch can only take place in an application proceeding, a forum where ORA has the opportunity to engage in discovery, prepare testimony and examine witnesses.
We agree with ORA.14 An advice letter process is not an appropriate forum to review least-cost dispatch, the scope of which includes decisions, actions and estimates related to the dispatch of all generation resources in the daily, hourly and real-time markets. The demonstration of compliance with SOC 4 may involve significant amounts of testimony and associated information and data. There must be a sufficient opportunity for parties to conduct analyses and prepare responsive testimony. The ERRA application process provides that opportunity. In contrast, pursuant to Section 454.5(d)(2), the review of contract terms and prices is subject to less stringent review and analysis. 15 The review of dispatch and contract administration in the ERRA and review of contract terms and prices in the quarterly procurement advice letter process is consistent with the requirements of Section 454.5 and our obligation to provide for just and reasonable rates. We do not see the need to change the processes at this time, and deny SCE's request to do so.
14 Even if we did not agree with ORA on this point, we note that this is not the appropriate forum for SCE to raise such a proposal which has industry-wide impacts. 15 This section states that an approved procurement plan should "eliminate the need for after-the-fact reasonableness reviews of an electrical corporation's actions in compliance with an approved procurement plan, including resulting electricity procurement contracts, practices and related expenses. However, the commission may establish a regulatory process to verify and assure that each contract was administered in accordance with the terms of the contract, and contract disputes which may arise are reasonably resolved." The regulatory process established by the Commission is the establishment and review of SOC 4.
