16. Assignment of Proceeding

Timothy Alan Simon is the assigned Commissioner and David K. Fukutome is the assigned ALJ in this proceeding.

1. There were no protests to this application.

2. Except for modified terms and conditions to SCE's 2005 proforma, the Geysers PPSA is consistent with SCE's approved 2005 renewable procurement plan.

3. Levelized contract prices at or below the 2005 MPR are considered per se reasonable as measured according to the net present value calculations explained in D.04-06-015, D.04-07-029, and D.05-12-042.

4. The contractual pricing mechanism for baseload power and additional power set forth in the Geysers PPSA currently reflect prices that are at or below the relevant 2005 MPR.

5. R.04-04-026 set forth standard terms and conditions to be incorporated into RPS power purchase agreements.

6. SCE's modifications to the standard terms and conditions are either necessary to reflect the facts of the Geysers PPSA or, in providing clarity, are minor as compared to the terms and conditions approved in SCE's 2005 Procurement Plan and R.04-04-026.

7. The 2009-2011 RA Confirmation is accordance with Commission policies and procurement requirements as specified in D.04-12-048.

8. The 2009-2011 RA Confirmation is a bilateral contract and is subject to the case, as specified in D.03-12-062, where longer-term non-standard products are allowed provided that the IOU include a product justification in quarterly compliance filings.

9. The CSA is reasonable in light of the record.

10. The CSA is consistent with law.

11. The CSA is in the public interest.

1. The Geysers PPSA should be approved without modification.

2. SCE should be allowed to fully recover the Geysers PPSA payments in rates over the life of the project, subject to Commission review of SCE's administration of the PPSA.

3. Procurement pursuant to the Geysers PPSA constitutes procurement from eligible renewable energy resources for purposes of determining SCE's compliance with any obligation that it may have to procure eligible renewable energy resources pursuant to the California Renewables Portfolio Standard (§ 399.11 et seq.), D.03-06-071, or other applicable law.

4. SCE should be allowed to recover in rates any indirect costs of renewables procurement identified in § 399.15(a)(2).

5. The 2009-2011 RA Confirmation should be approved without modification.

6. For purposes of fulfilling the requirements of D.03-12-062, SCE should include a product justification for the 2009-2011 RA Confirmation in subsequent quarterly compliance reports.

7. SCE should be allowed to fully recover the 2009-2011 RA Confirmation payments in rates, subject to Commission review of SCE's administration of the 2009-2011 RA Confirmation.

8. The CSA should be approved.

9. This decision should be made effective immediately.

ORDER

IT IS ORDERED that:

1. The Contingent Settlement Agreement between Southern California Edison Company (SCE), Calpine Energy Services, LP (CES) and Geysers Power Company, LLC (Geysers), as detailed in Appendix J of Exhibit 1, is approved.

2. The Renewable Power Purchase and Sale Agreement between SCE and Geysers (Geysers PPSA), as detailed in Appendix K of Exhibit 1, is approved.

3. The 2009-2011 Resource Adequacy (RA) Confirmation between SCE and CES for Pastoria Resource Adequacy Capacity, as detailed in Appendix N of Exhibit 1, is approved.

4. SCE shall include a product justification for the 2009-2011 RA Confirmation in subsequent quarterly compliance reports.

5. SCE is authorized to recover in rates payments made pursuant to the Geysers PPSA and the 2009-2011 RA Confirmation, subject to further review with respect to reasonableness of SCE's administration of the Geysers PPSA and the 2009-2011 RA Confirmation.

6. SCE's October 22, 2007 motion to offer testimony into evidence is granted. As described in the body of this decision, the pieces of SCE's testimony are identified as Exhibits 1 and 2 and are received into evidence.

7. SCE's October 22, 2007 motion to seal portions of the evidentiary record is granted as set forth below. Exhibit 1 shall be placed under seal and shall remain sealed for a period of three years from the effective date of this decision.

8. Application 07-06-007 is closed.

This order is effective today.

Dated November 16, 2007, at San Francisco, California.

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