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ALJ/CAB/eap Mailed 2/17/2006

Decision 06-02-031 February 16, 2006

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Order Instituting Rulemaking to Establish Policies and Cost Recovery Mechanisms for Generation Procurement and Renewable Resource Development.

Rulemaking 01-10-024
(Filed October 25, 2001)

OPINION ON REHEARING ON SAN DIEGO GAS & ELECTRIC
COMPANY'S APPLICATION FOR APPROVAL FOR THE
OTAY MESA GENERATING PLANT

I. Summary

This decision on rehearing grants the application of San Diego Gas & Electric Company (SDG&E) for approval to enter into a ten-year power purchase agreement (PPA) with Calpine Corporation (Calpine)1 for electric power from the Otay Mesa Energy Center (OMEC).2

1 Calpine testimony clarified that the PPA would be with Otay Mesa Energy Center, LLC, a wholly-owned subsidiary of Calpine. Schleimer testimony, Exhibit 23, p. 1.

2 The electric generating facility that Calpine proposes to build and that is the subject of this rehearing has been referred to by numerous names, including the Otay Mesa Generating Plant. In order to clearly distinguish the generating facility from the recently approved Otay Mesa transmission project, we will refer to the plant as the Otay Mesa Energy Center (OMEC) in this decision.

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