2. Background

AB 970, signed by the Governor on September 6, 2000, requires the Commission to initiate certain load control and distributed generation activities within 180 days. By ruling dated October 17, 2000, we assigned the implementation of Pub. Util. Code § 399.15(b) (codifying AB 970), paragraphs 4 through 7 to this proceeding. The relevant excerpts from the statute are as follows:

4. Incentives to equip commercial buildings with the capacity to automatically shut down or dim nonessential lighting and incrementally raise thermostats during peak electricity demand period.

5. Evaluation of installing local infrastructure to link temperature setback thermostats to real-time price signals.

6. Incentives for load control and distributed generation to be paid for enhancing reliability.

7. Differential incentives for renewable or super clean distributed generation resources.

In the same October 17, 2000 ruling, we directed the Energy Division to "develop specific program plans for implementing load control and distributed generation initiatives per § 399.15(b) for our consideration." We also consulted with the California Energy Commission (CEC) during the development of these programs.

The Energy Division report on recommended programs was issued for comment on January 31, 2001. The following organizations responded: Cannon Technologies, Capstone Turbine Corporation (Capstone), CEC, California Independent System Operator (ISO), California Retailers Association, Natural Resources Defense Council (NRDC), Office of Ratepayer Advocates (ORA), PG&E, SDG&E/SoCal (jointly), SCE, Solar Development Corporation, The Utility Reform Network (TURN) and Xenergy, Inc. (Xenergy).