2. DWR Contracts and Imports

Calpine claims that the Decision also errs by allowing DWR contracts to be counted for RA purposes, without a phase-out period. Again, the rehearing application makes a claim of error about a determination that has already been made. The decision on how to include DWR contracts in the RA framework was definitively made in Resource Adequacy Decision [D.04-10-035], supra. That decision found, at Conclusion of Law 21:

The long-term contracts executed by DWR should be eligible as resources even if certain features would otherwise exclude a non-DWR contract with the same terms and conditions, but the deliverability screens that will be developed in this proceeding should be applied to them.

The Decision does not make any further determinations on this matter. Rather, it simply points out that the issue was previously decided, and notes that the phase-out of LD contracts does not apply to DWR contracts, "to give effect to that decision [D.04-10-035]." (D.05-10-042, at p. 64.)¹² As discussed above, section 1731 bars any challenge of a Commission decision "in any court" if an application for rehearing is not filed. No party challenged D.04-10-035 and it became final. It is not

error for us to defer to previously-instituted requirements, and section 380 cannot be read to govern determinations made before the statute was enacted.

Calpine similarly claims that import LD contracts will improperly continue as part of the RAR framework. (Calpine's Rehearing Application at p. 5.) The Decision, however, clearly notes that import LD contracts have their own, unique, characteristics, distinguishing between import contracts and "in-area LD contracts" when necessary. (E.g., D.05-10-042, at p. 62.) Import contract imports qualify for RAR because they are backed by spinning reserve, are delivered on transmission capacity that cannot be curtailed, and specify a firm delivery point. (D.05-10-042, at p. 67.) The Decision explains, at p. 68:

Firm import LD contracts do not raise issues of double counting and deliverability that led us to conclude that other LD contracts should be phased out for purposes of RAR. We note that firm import contracts are backed by spinning reserves.

The Decision also notes that, historically, imports met the CAISO's deliverability criteria. (D.05-10-042, at p. 54.) This is a key difference between in-area and import LD contracts. Import capacity can be counted towards RA obligations in a way that is consistent with section 380, subdivision (c) because import capacity: (i) meets the deliverability requirement, and (ii) has sufficient physical resources associated with it (spinning reserve and firm delivery to a specific point). We will deny the applications for rehearing on these two points.

¹² In addition, DWR contracts are the subject of their own regulatory framework, controlled by provisions of the Water Code and various decisions. (See, e.g., Water Code, §§ 80100, 80104, 80106.) As set forth in, e.g., D.02-09-053 and D.03-06-074, DWR contracts were entered into pursuant to statutory authority during the energy crisis and subsequently allocated to IOUs as part of the IOU's resumption of procurement. As D.04-10-035 acknowledges with its separate consideration of DWR contracts, the treatment of DWR contracts was definitively resolved in decisions such as D.02-09-053 and D.02-12-069. (Resource Adequacy Decision [D.04-10-035], supra, at p. 29 (slip. op.).) It is not error for us to accommodate this separate set of procurement requirements in the Decision.