VII. CCC's Comments on Utility Energy Price Information
CCC contends that SDG&E's, Edison's and PG&E's responses do not present an accurate picture of the energy prices paid by utilities during the Remand Period. CCC argues that prices paid by the utilities, PX, and DWR were substantially greater than SRAC prices. CCC argues that SDG&E, Edison and PG&E did not provide data on actual energy costs in response to the October 21, 2004 ALJ Ruling, but instead provided net prices reduced by expected refunds. CCC adds that MMCP prices will be adjusted for generators that can demonstrate they bought gas in arms-length transactions at California border prices, and that the heat rate used in determining the MMCP would be greater if QFs had not supplied power. CCC contends that it is highly questionable whether any capacity costs are included in purchased power costs as the comparisons between the generation supply curves of QFs and other generation are comparable due to the averaging of prices used in the comparisons are averaged, and as there are payment incentives for QFs to produce during peak periods thus increasing QF energy production in peak periods.
CCC provides additional price information to demonstrate its arguments. CCC states that in December 2000, and between January 1, 2001, and January 18, 2001, average day - ahead PX prices were $309/MWH, and $336/MWH North-of-Path 15, and $223/MWH $277/MWH South-of-Path 15, respectively. CCC also cites PX prices that were between $150/MWH52 and $320/MWh, a price reflecting an uncapped market-clearing price. CCC provides that ISO purchases as reported in ISO's "Weekly Market Watch" reports show the following:
ISO Pricing Information
Period Price ($/MWh)
December 2000 $231
January 2001 285
February 2001 376
March 2001 314
CCC explains that after the demise of the PX, DWR purchased energy at significant prices above the amounts reported in the utilities' responses. CCC points out that the utilities' responses only show the remittance rates to DWR established by the Commission in D.02-02-052, not the market clearing prices at the time of purchase. CCC summarizes DWR average power purchases, including the percentage of total purchases, as the following:
DWR Power Costs ($/MWh)
Period Spot Market Contracts Ancillary Services Weighted Avg.
(74%) (20%) (6%)
Jan. 18-31, 2001 $321 $305 $ 305 $316
February 2001 308 165 312 290
March 2001 271 188 329 249
52 This price represents FERC's "soft cap," which can be exceeded if justified by cost.
