Background

To aid in the understanding of the procedural activities leading up to RACE's reclassified petition for modification of D.04-09-022, a brief chronology of the relevant events is provided below.

The Commission initiated this rulemaking (rulemaking or OIR) on January 22, 2004. The rulemaking sought comments from the gas utilities and interested parties on the Phase I and Phase II issues.² The Phase I proposals were filed, and comments and reply comments were filed. In the Phase I scoping memo and ruling of June 18, 2004, the assigned Commissioners ruled that no evidentiary hearings would be held on the Phase I issues.³ In accordance with Rule 14.1 of the Commission's Rules of Practice and Procedure (Rules), a draft decision on the Phase I issues was prepared based on a review of the Phase I proposals and the comments and reply comments. The Phase I draft decision was mailed for comment on July 20, 2004, and placed on the Commission's August 19, 2004 agenda for consideration. (See D.04-09-022, pp. 7-9, 82.)

On August 18, 2004, the day before the Commission was scheduled to consider the Phase I draft decision, RACE submitted its "Motion for a Determination of Applicability of the California Environmental Quality Act To The Phase I Draft Decision" to the Commission's Docket Office for filing.⁴ RACE's August 18, 2004 motion stated that the motion was "submitted pursuant to CPUC Rules 45, 17.1 and 17.2."⁵

An alternate draft decision on the Phase I issues was issued for comment on August 19, 2004. As a result, the Commission's consideration of the draft decision and the alternate draft decision was deferred to the Commission's September 2, 2004 meeting, at which time the Commission issued D.04-09-022.

The following day, the assigned Commissioners denied RACE's August 18, 2004 motion, ruling that "since there is no specific project being approved in the Phase I decision, CEQA does not apply at this juncture." (September 3, 2004 ACR, p. 5.)

On October 8, 2004, RACE filed a motion to apply CEQA to the Phase I and Phase II decisions. RACE's October 8, 2004 motion sought a determination that CEQA applies to "the Phase I Decision, Phase II Draft Decision and the Rulemaking as [a] whole." (RACE October 8, 2004 Motion, p. 3.)⁶

On February 28, 2005, the assigned Commissioners issued a scoping memo and ruling which described the Phase II issues, and denied RACE's October 8, 2004 motion, noting that RACE's October 8, 2004 motion was virtually identical to RACE's August 18, 2004 motion which was previously denied.

On March 29, 2005, RACE submitted for filing an "Application for Rehearing of Phase II Scoping Memo and Ruling of the Assigned Commissioners Dated February 28, 2005." Since an application for rehearing can only be filed in connection with a Commission order or decision,⁷ the Docket Office, with the consent of RACE, renamed the document as a "Motion for Reconsideration of that portion of the Assigned Commissioner's Scoping Ruling dated February 28, 2005 that denied R.A.C.E.'s Motion for a Determination of the Applicability of C.E.Q.A." and filed it on April 1, 2005 (the April 1, 2005 motion).⁸

The assigned Commissioners subsequently reclassified the April 1, 2005 motion as a petition for modification (petition) of D.04-09-022, in order to "allow the full Commission to address RACE's contention of whether CEQA should apply to the Phase I decision ... independent of any determination by the full Commission of whether CEQA should apply to the Phase II issues." (October 18, 2005 ACR, p. 4.) The ACR also permitted RACE and other interested parties to file supplemental responses and replies on whether CEQA should or should not apply.

On November 14, 2005, Coral Energy Resources, L.P. (Coral) filed a response, and San Diego Gas & Electric Company (SDG&E), Southern California Gas Company (SoCalGas), and Pacific Gas and Electric Company (PG&E) filed a joint response.

It appears that on or about November 14, 2005, RACE served its "Supplemental Response Permitted By Assigned Commissioners' Ruling Reclassifying the April 1, 2005 Motion as a Petition for Modification of Decision 04-09-022" on some of the parties to this proceeding, but never filed its response with the Commission, as evidenced by a lack of an entry for RACE in the Commission's Docket Card records around the November 14, 2005 period. Nor was RACE's response served on administrative law judge (ALJ) Wong despite RACE's certificate of service listing ALJ Wong as having been served.⁹

On November 30, 2005, SDG&E, SoCalGas and PG&E filed a joint reply to RACE's supplemental response, and RACE filed its "Reply to Supplemental Responses Permitted by Assigned Commissioners' Ruling Reclassifying the April 1, 2005 Motion as a Petition for Modification of Decision 04-09-022."¹⁰

² The Phase I issues addressed interstate pipeline capacity contracts, access on the intrastate pipelines to future LNG supplies, and access on interconnecting facilities with interstate pipelines. The Phase II issues address infrastructure adequacy and slack capacity guidelines, natural gas quality, and a standardized operational balancing agreement.

³ RACE appealed the scoping memo's categorization of this proceeding as quasi-legislative. That appeal was denied in D.04-07-030. The Phase II issues were categorized as ratesetting.

⁴ RACE's August 18, 2004 motion was not filed with the Docket Office because RACE failed to include a certificate of service and a service list with its submission, as required by Rules 2.3 and 3. (See September 3, 2004 ACR Regarding Motion, fn. 1, p. 1.)

⁵ Rules 17.1 and 17.2 address the procedures for filing a motion for determining whether a proceeding involves a project subject to or exempt from CEQA, and Rule 45 addresses motion practice in general.

⁶ As noted in footnote 1 of the February 28, 2005 scoping memo and ruling, no Phase II Draft Decision or Phase II Proposed Decision had been issued as of that date. Evidentiary hearings into the Phase II infrastructure adequacy and slack capacity issues were held in August and September 2005. A proposed decision on those Phase II issues is expected shortly. Evidentiary hearings into the gas quality issues were held in December 2005, and a proposed decision on those issues is expected in the near future.

⁷ See Pub. Util. Code § 1731 and Rule 85.

⁸ On August 30, 2005, RACE filed a petition for writ of mandate in the California Supreme Court requesting that the Commission be directed to undertake an environmental review pursuant to CEQA. Subsequently, RACE requested that it be dismissed without prejudice, and on December 20, 2005, the Supreme Court ordered that RACE's petition for writ of mandate be withdrawn.

⁹ Despite these shortcomings on RACE's part, we address RACE's supplemental response in this decision because the utilities were apparently served with RACE's supplemental response as evidenced by the utilities' November 30, 2005 joint reply to RACE's supplemental response.

¹⁰ ALJ Wong was not served with RACE's reply until December 4, 2005.