2. Background
During California's energy crisis of 2000-2001, electric powerplants were sometimes operated in questionable ways, or taken out of service for questionable reasons, as documented in our filings at the Federal Energy Regulatory Commission (FERC).2 This resulted in electricity power shortages and outages, danger to public health and safety, and dramatically increased prices. (See Attachment 2.) It is critical to California's economy, public health and public safety, however, that its electricity system be available and reliable. Parties share this belief:
"...it cannot be stressed too strongly that this Commission and electric generators share a common goal: to ensure that generation in California is available when needed to meet customers' demand for electricity." (West Coast Power (WCP) Comments dated October 6, 2004, page 3, emphasis in original.)
"DENA [Duke Energy North America] reiterates its shared interest with the Commission in providing California with efficient and reliable sources of power." (DENA Comments October 6, 2004, page 6; also in DENA Supplemental Comments November 3, 2004, page 7.)
The legislature responded to this situation with SB X2 39. This legislation established the Committee for the purpose of adopting operation and maintenance standards for electric generation facilities to ensure reliability and availability. (§ 761.3(b).) The Committee met nine times between December 2002 and October 2004. Following notice and opportunity for comment, the Committee adopted the following standards:
1. Maintenance Standards on February 3, 2003;
2. Logbook Standards for thermal powerplants on April 1, 2003;
3. GDS 1-3 on May 2, 2003;
4. Revised GDS 1-6 on June 3, 2003;
5. Logbook Standards for hydroelectric powerplants on April 27, 2004; and
6. Operation Standards on October 27, 2004.
The Committee has now completed its work, and the Committee expires on January 1, 2005. (§761.3(b)(3).)
SB X2 39 also directs that the Commission shall:
"implement and enforce standards adopted [by the Committee] for the maintenance and operation of facilities for the generation of electric energy owned by an electrical corporation or located in the state to ensure their reliable operation. The Commission shall enforce the protocols for the scheduling of powerplant outages of the Independent System Operator." (§ 761.3(a).)
We implement and enforce Committee-adopted standards and CAISO powerplant outage scheduling protocols through GO 167. (D.04-05-017 and D.04-05-018.) Our prior orders describe the Committee and Commission background and process for these items, which we do not repeat here.
Section 8 of GO 167 was reserved for Operation Standards. We briefly describe the Committee and Commission process leading to today's order.
2.1. Committee Process
In 2003, the Committee directed its staff to develop and propose draft Operation Standards. On August 23, 2004, Committee Presiding Officer Carl Wood served draft Operation Standards for comment on participants before the Committee. On September 10, 2004, timely comments were served by (1) Pacific Gas and Electric Company (PG&E); (2) Southern California Edison Company (SCE); (3) San Diego Gas & Electric Company (SDG&E); (4) AES Alamitos, LLC, AES Huntington Beach, LLC, and AES Redondo Beach, LLC (AES); (5) Calpine Corporation (Calpine); (6) Duke Energy North America (DENA); (7) Elk Hills Power, LLC (Elk Hills); (8) FPL Energy, LLC (FPLE); (9) Independent Energy Producers Association (IEP); (10) Mirant Delta, LLC and Mirant Potrero, LLC (Mirant); (11) Reliant Energy Coolwater, Inc., Reliant Energy Ellwood, Inc., Reliant Energy Etiwanda, Inc., Reliant Energy Mandalay, Inc., and Reliant Energy Ormond Beach, Inc. (Reliant); and (12) West Coast Power (El Segundo Power LLC, Long Beach Generation LLC, Cabrillo Power I LLC, and Cabrillo Power II LLC, or WCP). No reply comments were served by the September 15, 2004 deadline.
On September 20 and 21, 2004, Committee staff conducted workshops in San Francisco to further consider and develop draft Operation Standards. On October 1, 2004, supplemental comments were served by PG&E, SCE, SDG&E, AES, Calpine, DENA, Reliant, WCP and Joint Generating Asset Owners (composed of PG&E; SCE; SDG&E; AES; Calpine; DENA; FPLE; High Desert Power Project, LLC (HDPP); La Paloma Generating Company; Mirant; Reliant; and WCP). On October 6, 2004, supplemental reply comments were served by Elk Hills.
On October 15, 2004, Committee staff served recommended revised draft Operation Standards on the Committee and participants, with limited further changes suggested on October 26, and at the meeting on October 27, 2004. On October 27, 2004, the Committee heard public comments from PG&E, WCP, and HDPP. After the opportunity for discussion, the Committee adopted Resolution No. 5, including the final "Operation Standards and Recommended Guidelines for Generating Asset Owners." On November 1, 2004, Resolution No. 5 and the final Operation Standards were filed with the Commission and served on the service list. (See Attachment 3 for a copy of Operation Standards and Recommended Guidelines for Generating Asset Owners.)
In summary, the Committee adopted 28 Operation Standards. Operation Standards 1-11 are largely similar or the same as the first eleven Maintenance Standards. Operation Standards 12-28 are new and are specifically tailored to powerplant operation. The Operation Standards include, but are not limited to: safety, organizational structure and responsibilities, management and leadership, problem resolution, training, plant status, conduct, inspections, clearances, performance testing, emergency grid operations, security, readiness, changes in status, and unit storage. In addition, the Committee adopted Guidelines on how each Generating Asset Owner (GAO) may comply with each Standard.3 Finally, the Committee also made several recommendations to the Commission on how to implement the Committee-adopted Standards.
2.2. Commission Process
By ruling dated September 13, 2004, parties were invited to file and serve pleadings on Commission implementation and enforcement of Operation Standards. The ruling included limited proposed changes to GO 167:
a. inclusion of Operations Standards (GO 167 §§ 2, 3, 8, 15 and Appendix D);
b. clarification of the expiration of GDSs (GO 167 § 4);
c. clarification of the effective date of changes (GO 167 §§ 4 and 15); and
d. correction of a prior error (GO 167 § 15.1.1).
By ruling dated September 20, 2004, dates were extended for the filing and service of various pleadings. On October 6, 2004, timely comments on Commission implementation and enforcement were filed and served by PG&E, SCE, SDG&E, Calpine, DENA, Elk Hills, Mirant, Reliant, and WCP. On October 13, 2004, no reply comments were filed.
On November 3, 2004, timely supplemental comments were filed and served by SDG&E, Calpine, DENA and Mirant. On November 8, 2004, no supplemental reply comments were filed.
On November 9, 2004, a motion for formal hearing was filed and served by Calpine. No responses were filed. The motion was denied by ruling filed on November 15, 2004.
We carefully consider the record before us. We adopt the changes to GO 167 in Attachment 4 for the reasons explained below. We are persuaded by parties in some cases not to adopt what was proposed in the ruling dated September 13, 2004, or to adopt a variation. In other cases, we are not persuaded to make any modification, and adopt what was proposed September 13, 2004. Further, we include the filing of plan summaries as recommended by the Committee. Parties also raise issues common to operation and maintenance which we address separately. Finally, parties again raise arguments about jurisdiction, which we discuss briefly below.
We address the following in order:
Chapter 3: Operation standards
Chapter 4: Expiration of GDS
Chapter 5: Effective dates
Chapter 6: Correction of prior errors and miscellaneous changes
Chapter 7: Issues common to operation and maintenance
Chapter 8: Jurisdiction
