12. Assignment of Proceeding
Carl W. Wood is the Assigned Commissioner. John E. Thorson and Burton W. Mattson are the assigned ALJs in this proceeding.
1. On November 1, 2004, the Committee filed its Resolution No. 5, including Generator Operation Standards and Recommended Guidelines, with the Commission for Commission implementation and enforcement pursuant to § 761.3(a).
2. Timely comments and supplemental comments were filed and served regarding Commission implementation and enforcement of Operation Standards and Recommended Guidelines, and a motion for formal hearing was denied.
3. The Committee does not intend that each Guideline be enforceable.
4. Some parties recommend that (a) each GAO file with the Commission a summary (or report) regarding its Operation Plan in a manner that provides the GAO with flexibility while retaining accountability, and (b) the Commission incorporate the Committee's recommendation regarding the filing of an Operation Plan summary.
5. The Committee recommends "that the Commission implement the standards in a way that provides GAOs with considerable flexibility in meeting the standards while retaining accountability," that each GAO be required "to file for each power generation unit an Operation Plan" that summarizes key characteristics of each unit, and that "the Commission require the Operation Plan to be updated appropriately."
6. The adopted approach (i.e., a detailed Plan demonstrating compliance or corrective action with regard to each Standard, the detailed Plan retained at the GAO site, a verified Initial Certification filed with the Commission, a verified Plan Summary filed with the Commission, periodic verified re-certifications, periodic updating and verified re-filing of the Plan Summary, CPSD obtaining other information by information request) provides flexibility while retaining accountability, requires the filing of reasonable plans, and requires appropriate updates.
7. Each GAO must comply with each Maintenance and Operation Standard and may-but is not required to-use some or all Guidelines to demonstrate compliance.
8. The adoption of 90 days to achieve compliance after filing the Initial Certification results in compliance by early Summer 2005, while a period of 180 results in compliance after Summer 2005.
9. It is neither necessary to increase the days for a GAO to file its Initial Certification regarding its Operation Plan from 90 to 180 (since this is an Initial Certification) nor is it desirable to decrease the days from 90 to 45 (given that there are 28 Operation Standards but were only 18 Maintenance Standards).
10. The existing definition of active service (GO § 2.1) could trigger the 90 day timeframe from when the plant is first tested, which could be many months before the plant is running on a regular, commercial basis.
11. The long-term status of a generation unit directly affects electrical service reliability and adequacy.
12. GO 167 includes provisions for a GAO to submit information subject to claims of confidentiality.
1. A formal hearing on Operation Standards is neither necessary nor required.
2. Each Standard is enforceable, but each Guideline is not.
3. CPSD should make adopted Guidelines available to GAOs upon request, modify adopted Guidelines over time as necessary and reasonable, and make revised Guidelines available to GAOs.
4. GO 167 § 8 should be reasonably parallel to GO 167 § 7, and vice versa.
5. The regulatory focus regarding both the Maintenance Plan and the Operation Plan should generally be on substance (not form), with GAOs permitted reasonable flexibility subject to being held accountable for compliance with each adopted Standard.
6. The Executive Director should specify the format and content elements of the Operation Plan Summary and Maintenance Plan Summary after considering the recommendations of GAOs (e.g., regarding format, organizational structure, content elements).
7. The changes to GO 167 stated in Attachment 4 should be adopted.
8. In conducting an audit, CPSD should use the Maintenance Plan and Operation Plan retained by each GAO on site, the Maintenance Plan Summary and Operation Plan Summary of each GAO filed with the Commission, a GAO's responses to information requests, Assessment Guidelines (Maintenance Standards), Recommended Guidelines (Operation Standards), Maintenance Guidelines for Electric Generating Facilities (Appendix A to Maintenance Standards attached to D.04-05-018), and other relevant and useful information to determine whether or not a GAO is in compliance with GO 167.
9. Failure to meet a Guideline may raise CPSD's concern about a GAO's compliance, and failure to meet a Guideline in combination with other evidence may demonstrate a violation, but failure to meet one or more Guideline(s) does not by itself demonstrate a failure to comply with GO 167.
10. References within the Standards and Guidelines to employees, management or other staffing descriptions should not be interpreted as requiring a GAO to follow any particular organizational structure.
11. Commission implementation and enforcement of GO 167 Standards should not interfere with the right of a GAO to manage its employees or internal business structures (e.g., right to hire, fire, reward and motivate its employees and structure its management) unless it involves compliance with GO 167 Standards (e.g., operation and maintenance of essential facilities that are necessary for maintaining and protecting public health and safety, and ensuring electrical service reliability and adequacy) or cooperation with the Commission (e.g., complying with requests for information or interviews; no retaliation).
12. Each GAO should have abundant, but not unlimited, authority to make its own business decisions in its operation and maintenance practices as long as the GAO complies with each Standard and the requirements of GO 167.
13. Private business interests and private business practices should yield to the public interest, health and safety when there is a conflict regarding an operation or maintenance standard implemented and enforced under GO 167.
14. CPSD should implement and enforce Operation Standard 25 with reasonable flexibility, as long as the GAO provides transfer of ownership notice to the Commission as soon as possible.
15. Confidentiality is not a valid defense for failing to notify the Commission of a transfer in ownership.
16. CEQA provides a categorical exemption for projects regarding the operation and maintenance of existing electric generation facilities, and a new facility will be subject to applicable CEQA review when construction of the facility is proposed.
17. The Executive Director should file a Notice of Exemption from CEQA regarding Operation Standards and changes to GO 167 adopted herein.
18. The Executive Director should forward the standards adopted herein, and all related current and future decisions that implement and enforce generator maintenance and operation standards, to the CAISO with a request that the CAISO submit these standards to the FERC for approval as amendments to the CAISO's tariff.
19. This proceeding should remain open to address limited concerns.
20. This order should be effective immediately so that Operation Standards can be implemented and enforced without delay, and the legislative findings and declarations contained in SB X2 39 can be secured for California residents and businesses without delay.
IT IS ORDERED that:
1. The changes to General Order (GO) 167 stated in Attachment 4 are adopted. The changes become effective on the third day after the mailing of this order. Each Generating Asset Owner subject to GO 167 shall comply with all terms therein, and shall file a verified Initial Certification regarding its Operation Plan within 90 days of the date changes to GO 167 become effective.
2. Respondents and parties may file and serve proposals on the format, organizational structure and content elements of the Operation Plan Summary. Proposals shall be filed and served within 30 days of the date this order is mailed, unless a different date is set by the Executive Director or the Director of the Consumer Protection and Safety Division.
3. The Executive Director will file a Notice of Exemption from the California Environmental Quality Act regarding Operation Standards.
4. The Executive Director will forward the standards adopted in this decision, and all related current and future decisions that implement generator operation and maintenance standards, to the California Independent System Operator (CAISO) with a request that the CAISO submit these adopted standards to the Federal Energy Regulatory Commission for approval as amendments to the CAISO's tariff.
5. The Executive Director will serve a notice of this decision on the owner or operator or each electric generation facility subject to Pub. Util. Code § 761.3 that is not already on the service list of this proceeding.
6. This proceeding remains open to address limited matters stated in the decision.
This order is effective today.
Dated December 16, 2004, at San Francisco, California.
MICHAEL R. PEEVEY
President
CARL W. WOOD
LORETTA M. LYNCH
GEOFFREY F. BROWN
SUSAN P. KENNEDY
Commissioners
Appearance
ALEX GOLDBERG TIM MULLER
WILLIAMS COMPANIES, INC. LEGAL DEPARTMENT
ONE WILLIAMS CENTER, SUITE 4100 WILLIAMS ENERGY SERVICES
TULSA, OK 74172 ONE WILLIAMS CENTER, MD 41-3
TULSA, OK 74172
J. CHRISTOPHER HAJOVSKY DAVID M. NORRIS
RELIANT ENERGY, INC. ATTORNEY AT LAW
1000 MAIN STREET, SUITE 1726 SIERRA PACIFIC POWER COMPANY
HOUSTON, TX 77002 6100 NEIL ROAD
RENO, NV 89520
HAMID V. NEJAD LISA URICK
LOS ANGELES DEPT. OF WATER & POWER ATTORNEY AT LAW
111 N. HOPE STREET, ROOM 1141 SAN DIEGO GAS & ELECTRIC COMPANY
LOS ANGELES, CA 90012 555 W. FIFTH STREET, SUITE 1400
LOS ANGELES, CA 90013-1011
DANIEL W. DOUGLASS BRIAN KATZ
DOUGLASS & LIDDELL SOUTHERN CALIFORNIA EDISON COMPANY
21700 OXNARD STREET, SUITE 1030 2244 WALNUT GROVE
WOODLAND HILLS, CA 91367-8102 ROSEMEAD, CA 91770
LARRY R. COPE MARK MINICK
ATTORNEY AT LAW SOUTHERN CALIFORNIA EDISON
SOUTHERN CALIFORNIA EDISON 2244 WALNUT GROVE BLV D.
2244 WALNUT GROVE AVENUE ROSEMEAD, CA 91770
ROSEMEAD, CA 91770
DANIEL A. KING MEREDITH E. ALLEN
SEMPRA ENERGY ATTORNEY AT LAW
101 ASH STREET, HQ13 SOUTHERN CALIFORNIA GAS COMPANY
SAN DIEGO, CA 92101 101 ASH STREET, HQ13
SAN DIEGO, CA 92101
KELLY M. MORTON EDWARD E. MADDOX
ATTORNEY AT LAW BUSINESS DEVELOPMENT MANAGER
SAN DIEGO GAS & ELECTRIC SEAWEST WINDPOWER, INC.
101 W. ASH STREET, MAIL STOP: HQ13B 1455 FRAZEE ROAD, SUITE 900
SAN DIEGO, CA 92101-3017 SAN DIEGO, CA 92108-4310
GINA M. DIXON JOSEPH KLOBERDANZ
SAN DIEGO GAS & ELECTRIC COMPANY SAN DIEGO GAS & ELECTRIC COMPANY
8330 CENTURY PARK COURT, M.S. CP32D 8330 CENTURY PARK COURT
SAN DIEGO, CA 92123 SAN DIEGO, CA 92123
DAVE BOWARD TOM ROMESBERG
GENERAL MANAGER LA PALOMA GENERATING COMPANY, LLC
HIGH DESERT POWER PROJECT LLC PO BOX 175
19000 PERIMETER ROAD 1760 WEST SKYLINE ROAD
VICTORVILLE, CA 92394 MCKITTRICK, CA 93251
MARC D. JOSEPH CHARLYN A HOOK
ATTORNEY AT LAW CALIF PUBLIC UTILITIES COMMISSION
ADAMS BROADWELL JOSEPH & CARDOZO LEGAL DIVISION
651 GATEWAY BOULEVARD, SUITE 900 ROOM 5033
SOUTH SAN FRANCISCO, CA 94080 505 VAN NESS AVENUE
SAN FRANCISCO, CA 94102-3214
EVELYN KAHL NORA SHERIFF
ATTORNEY AT LAW ATTORNEY AT LAW
ALCANTAR & KAHL, LLP ALCANTAR & KAHL LLP
120 MONTGOMERY STREET, SUITE 2200 120 MONTGOMERY STREET, SUITE 2200
SAN FRANCISCO, CA 94104 SAN FRANCISCO, CA 94104
ROD AOKI ROD AOKI
ATTORNEY AT LAW ATTORNEY AT LAW
ALCANTAR & KAHL, LLP ALCANTAR & KAHL, LLP
120 MONTGOMERY STREET, SUITE 2200 120 MONTGOMERY STREET, SUITE 2200
SAN FRANCISCO, CA 94104 SAN FRANCISCO, CA 94104
BARNEY SPECKMAN JANET C. LODUCA
NEXANT PACIFIC GAS AND ELECTRIC COMPANY
101 SECOND STREET, 11TH FLOOR 77 BEALE STREET, B30A
SAN FRANCISCO, CA 94105 SAN FRANCISCO, CA 94105
BRIAN T. CRAGG JOSEPH M. KARP
ATTORNEY AT LAW ATTORNEY AT LAW
GOODIN MACBRIDE SQUERI RITCHIE & DAY LLP WHITE & CASE LLP
505 SANSOME STREET, SUITE 900 3 EMBARCADERO CENTER, STE 2210
SAN FRANCISCO, CA 94111 SAN FRANCISCO, CA 94111
TERRY J. HOULIHAN LINDSEY HOW- DOWNING
BINGHAM MCCUTCHEN LLP ATTORNEY AT LAW
3 EMBARCADERO CENTER, 18TH FLOOR DAVIS WRIGHT TREMAINE, LLP
SAN FRANCISCO, CA 94111 ONE EMBARCADERO, SUITE 600
SAN FRANCISCO, CA 94111-3834
LISA A. COTTLE SARA STECK MYERS
ATTORNEY AT LAW ATTORNEY AT LAW
WHITE & CASE LLP 122 - 28TH AVENUE
3 EMBARCADERO CENTER, SUITE 2210 SAN FRANCISCO, CA 94121
SAN FRANCISCO, CA 94111-4050
ROXANNE PICCILLO SYLVIA D. GARDNER
REGULATORY ANALYSIS PACIFIC GAS AND ELECTRIC COMPANY
PACIFIC GAS AND ELECTRIC COMPANY PO BOX 770000, RM. 848A - B8R
MAIL CODE B10B SAN FRANCISCO, CA 94177-0001
PO BOX 770000
SAN FRANCISCO, CA 94177-0001
STEPHEN NELSON MARK J. SMITH
RJ RUDDEN AND ASSOCIATES FPL ENERGY
1032 LINDSEY CT. 7445 SOUTH FRONT STREET
LAFAYETTE, CA 94549 LIVERMORE, CA 94550
GREGORY T. BLUE PETER W. HANSCHEN
MANAGER, STATE REGULATORY AFFAIRS ATTORNEY AT LAW
DYNEGY INC. MORRISON & FOERSTER LLP
5976 WEST LAS POSITAS BLVD., NO. 200 101 YGNACIO VALLEY ROAD, SUITE 450
PLEASANTON, CA 94588 WALNUT CREEK, CA 94596
STEVE HUHMAN JAMES CROSSEN
SOUTHERN COMPANY ENERGY MARKETING SENIOR COUNSEL
1350 TREAT BLVD. SUITE 500 AUTOMATED POWER EXCHANGE, INC.
WALNUT CREEK, CA 94597 5201 GREAT AMERICA PARKWAY,
SUITE 522
SANTA CLARA, CA 95054
C. SUSIE BERLIN SCOTT BLAISING
ATTORNEY AT LAW ATTORNEY AT LAW
MC CARTHY & BERLIN, LLP BRAUN & BLAISING, P.C.
2005 HAMILTON AVENUE, SUITE 140 8980 MOONEY ROAD
SAN JOSE, CA 95125 ELK GROVE, CA 95624
KEITH JOHNSON PHILIP D. PETTINGILL
CALIFORNIA ISO CAISO
151 BLUE RAVINE ROAD 151 BLUE RAVINE ROAD
FOLSOM, CA 95630 FOLSOM, CA 95630
ANDREW B. BROWN ANDREW B. BROWN
ELLISON, SCHNEIDER & HARRIS, LLP ELLISON, SCHNEIDER & HARRIS, LLP
2015 H STREET 2015 H STREET
SACRAMENTO, CA 95814 SACRAMENTO, CA 95814
DOUGLAS K. KERNER STEVEN KELLY
ATTORNEY AT LAW INDEPENDENT ENERGY PRODUCERS ASSN
ELLISON, SCHNEIDER & HARRIS LLP 1215 K STREET, SUITE 900
2015 H STREET SACRAMENTO, CA 95814
SACRAMENTO, CA 95814
MICHAEL ALCANTAR PAUL CAPELL
ATTORNEY AT LAW PACIFIC POWER AND LIGHT
ALCANTAR & KAHL LLP 825 NORTHEAST NULTNOMAH, RM 1600
1300 SW FIFTH AVENUE, SUITE 1750 PORTLAND, OR 97232
PORTLAND, OR 97201
Information Only
JOEL D. NEWTON ALEX GOLDBERG
SENIOR ATTORNEY WILLIAMS COMPANIES, INC.
FPL ENERGY, LLC ONE WILLIAMS CENTER, SUITE 4100
801 PENNSYLVANIA AVE., NW, STE. 220 TULSA, OK 74172
WASHINGTON, DC 20004
TIM MULLER BRIAN FIELDS
LEGAL DEPARTMENT 1000 MAIN (OFFICE 3434D)
WILLIAMS ENERGY SERVICES HOUSTON, TX 77002
ONE WILLIAMS CENTER, MD 41-3
TULSA, OK 74172
KEVIN J. SIMONSEN PAT VANMIDDE
ENERGY MANAGEMENT SERVICES 22006 NORTH 55TH STREET
646 EAST THIRD AVENUE PHOENIX, AZ 85054-7150
DURANGO, CO 81301
NORMAN A. PEDERSEN TANDY MCMANNES
ATTORNEY AT LAW KJC CONSULTING COMPANY
HANNA AND MORTON LLP 2938 CROWNVIEW DRIVE
444 SOUTH FLOWER ST., SUITE 1500 RANCHO PALOS VERDES, CA 90275
LOS ANGELES, CA 90071
VITALY LEE JENNIFER LEHMANN
AES ALAMITOS, LLC AES PLACERITA, LLC
690 N. STUDEBAKER ROAD 20885 PLACERITA CANYON ROAD
LONG BEACH, CA 90803 NEWHALL, CA 91321
SOUTHERN CALIFORNIA EDISON COMPANY ATTORNEY AT LAW
CASE ADMINISTRATION SOUTHERN CALIFORNIA EDISON COMPANY
2244 WALNUT GROVE AVENUE, ROOM 370 2244 WALNUT GROVE AVENUE
ROSEMEAD, CA 91770 ROSEMEAD, CA 91770
CHRISTINE NGUYEN LINDA LEBHAR
LATHAM & WATKINS LATHAM & WATKINS
701 B STREET, STE. 2100 701 B STREET, STE. 2100
SAN DIEGO, CA 92101 SAN DIEGO, CA 92101
THOMAS CORR MICHAEL SHAMES
SEMPRA ENERGY ATTORNEY AT LAW
101 ASH STREET, HQ 15G UTILITY CONSUMERS' ACTION NETWORK
SAN DIEGO, CA 92101 3100 FIFTH AVENUE, SUITE B
SAN DIEGO, CA 92103
CENTRAL FILES JOHN W. LESLIE
SAN DIEGO GAS & ELECTRIC ATTORNEY AT LAW
8330 CENTURY PARK COURT LUCE, FORWARD, HAMILTON & SCRIPPS, LLP 11988 EL CAMINO REAL, SUITE 200
SAN DIEGO, CA 92123-1530 SAN DIEGO, CA 92130
THOMAS M. BARNETT ANJA IRWIN
VICE PRESIDENT AES HUNTINGTON BEACH, LLC
CONSTELLATION GENERATION GROUP 18904 DEODAR ST.
3501 JAMBOREE ROAD FOUNTAIN VALLEY, CA 92708
SOUTH TOWER, SUITE 606
NEWPORT BEACH, CA 92660
DIANE I. FELLMAN REGINA COSTA
LAW OFFICES OF DIANE I. FELLMAN THE UTILITY REFORM NETWORK
234 VAN NESS AVENUE 711 VAN NESS AVENUE, SUITE 350
SAN FRANCISCO, CA 94102 SAN FRANCISCO, CA 94102
ANDREW L. NIVEN
ATTORNEY AT LAW CALIFORNIA ENERGY MARKETS
PACIFIC GAS AND ELECTRIC COMPANY 517-B POTRERO AVENUE
77 BEALE STREET, SUITE 3109 SAN FRANCISCO, CA 94110
SAN FRANCISCO, CA 94105
LULU WEINZIMER JUNE RUCKMAN
CALIFORNIA ENERGY CIRCUIT PACIFIC GAS AND ELECTRIC COMPANY
695 9TH AVE. NO.2 PO BOX 770000, MAIL CODE B8R
SAN FRANCISCO, CA 94118 SAN FRANCISCO, CA 94177
AVIS CLARK SETH D. HILTON
CALPINE CORPORATION MORRISON & FOERSTER LLP
4160 DUBLIN BLVD. 101 YGNACIO VALLEY ROAD
DUBLIN, CA 94568 WALNUT CREEK, CA 94596
BARRY F. MCCARTHY
MRW & ASSOCIATES ATTORNEY AT LAW
1999 HARRISON STREET, SUITE 1440 MCCARTHY & BERLIN, LLP
OAKLAND, CA 94612 2005 HAMILTON AVENUE, SUITE 140
SAN JOSE, CA 95125
BRUCE MCLAUGHLIN RICHARD MCCANN
8066 GARRYANNA DRIVE M.CUBED
CITRUS HEIGHTS, CA 95610 2655 PORTAGE BAY ROAD
DAVIS, CA 95616
CAROLYN M. KEHREIN
ENERGY MANAGEMENT SERVICES CALIFORNIA ISO
1505 DUNLAP COURT LEGAL AND REGULATORY DEPARTMENT
DIXON, CA 95620-4208 151 BLUE RIVER ROAD
FOLSOM, CA 95630
KEVIN SMITH KEVIN WOODRUFF
BRAUN & BLAISING, P.C. WOODRUFF EXPERT SERVICES
915 L ST STE. 1460 1100 K STREET, SUITE 204
SACRAMENTO, CA 95814 SACRAMENTO, CA 95814
MELANIE GILLETTE
DUKE ENERGY NORTH AMERICA
980 NINTH STREET, SUITE 1420
SACRAMENTO, CA 95814
Page 1
R.02-11-039
EVENTS IN CALIFORNIA'S ENERGY CRISIS
The following items provide information on the nature and extent of the problems facing California during the 2001-2002 energy crisis: (1) the Governor's 2001 State of the State Address, (2) a State of Emergency Proclamation issued January 17, 2001, and (3) Senate Bill (SB) X2 39.
1. 2001 State of the State Address
On January 8, 2001, Governor Gray Davis addressed the dysfunctional electricity market and withholding of power in his State of the State address (excerpted below):
"...a dysfunctional energy market...is threatening to disrupt people's lives and damage our economy.
***
"[restructuring] has resulted in skyrocketing prices, price gouging, and an unreliable supply of electricity. In short, an energy nightmare.
***
"Worst of all, there's evidence that some generators may be withholding electricity from the California grid to create artificial scarcity; which, in turn, drives up the price astronomically.
***
"And make no mistake, we will regain control over the power that's generated in California and commit it to the public good.
***
"In the days that follow, I will ask you [the legislature] to pass legislation to take these immediate steps:
***
"Four, provide state regulatory agencies with the authority to order any functioning generating facility down for `unscheduled maintenance' to go back on line.
"Five, give the Public Utilities Commission 50 new inspectors to monitor and, if necessary, stand guard at any facility suspected of deliberately withholding power from the grid.
"Six, make it a criminal act to deliberately withhold power from the grid, if it results in the imminent threat to public health or safety." i2. State of Emergency Proclamation
On January 17, 2001, the disruption in the electricity market caused Governor Davis to proclaim a State of Emergency (excerpted below):
"WHEREAS, shortages of electricity available to California's utilities have today resulted in blackouts affecting millions of Californians; and
* * *
"WHEREAS, the imminent threat of widespread and prolonged disruption of electrical power...constitutes a condition of extreme peril to the safety of persons and property within the state...
* * *
"NOW, THEREFORE, I, GRAY DAVIS, Governor of the State of California...HEREBY PROCLAIM A STATE OF EMERGENCY to exist within the State of California..."
3. Senate Bill X2 39
The legislature responded with several pieces of legislation in 2001 and 2002. On April 26, 2002, Senate Bill X2 39 was filed with the California Secretary of State. In Section 1 of SB X2 39:
"In particular, the Legislature found and declared that:
"a. Electric generating facilities and powerplants in California are essential facilities for maintaining and protecting the public health and safety of California residents and businesses.
"b. It is in the public interest to ensure that electric generating facilities and powerplants located in California are effectively and appropriately maintained and efficiently operated.
"c. Owners and operators of electric generating facilities and powerplants provide a critical and essential good to California residents.
"d. To protect the public health and safety and to ensure electrical service reliability and adequacy, the Commission and the California Independent System Operator (CAISO) shall develop uniform operating practices and procedures, and the Commission shall enforce compliance with those practices and procedures." (D.04-05-017, mimeo., page 11.)
