IX. Comments on Draft Decision

The draft decision of the ALJ in this matter was mailed to the parties in accordance with Pub. Util. Code § 311(g)(1) and Rule 77.7 of the Rules of Practice and Procedure. Comments were filed ______________.

Findings of Fact

1. Development of solar technologies is consistent with state policy and could provide California with a clean and reliable source of disbursed energy. Because the industry and related markets are still not well-developed, an incentive payment program, such as the one envisioned by SB 1, the Governor and the staff report, would benefit California.

2. The existing CEC and Commission solar incentive programs, the ERP and the SGIP, are similar except that they provide incentives to different sized projects and are funded by different utility rates.

3. Increasing SGIP funding for solar projects by $300 million recognizes the current demand for incentives and the need to spur additional solar development.

4. The 2005 level of SGIP incentives for solar projects of $3.50/watt has motivated substantial demand for solar incentive funds. The number of SGIP applications for solar incentives is evidence that the 2005 incentive level is higher than necessary to motivate investment.

5. The record of this proceeding is not adequate to adopt a comprehensive CSI program at this time.

Conclusions of Law

1. The Commission should increase SGIP funding for solar projects by $300 million for 2006.

2. Initial CSI incentive levels for solar PV and concentrated solar should be set at $2.80 / kW, consistent with the CEC's ERP incentives.

3. The SGIP program administrators should apply the revised rebate level to the waiting list, allowing projects to drop off if requested, with full return of their application fee.

4. The Commission staff and the CEC staff should develop a comprehensive CSI program proposal in a report to the Commission that should be filed as part of a ruling and served on all parties no later than December 15, 2005. The assigned ALJ and the staff of the Commission and the CEC should work cooperatively to develop a record on the outstanding program issues identified in this order.

ORDER

IT IS ORDERED that:

1. Pacific Gas and Electric Company (PG&E), Southern California Edison Company (SCE), Southern California Gas Company (SoCalGas) and San Diego & Electric Company (SDG&E) shall fund the California Solar Initiative (CSI) as set forth herein at a level of $300 million for 2006 and assume program costs in proportion to their respective annual revenues.

2. PG&E, SCE, SoCalGas, SDREO and SDG&E shall modify SGIP solar incentive levels to $2.80 a watt beginning the effective date of this order.

3. PG&E, SCE, SoCalGas, SDREO and SDG&E shall offer projects on the 2005 waiting list an incentive of $2.80. Applicants who elect to withdraw their application will receive a refund of their application fees.

4. The Commission's Executive Director shall direct Commission staff to propose a comprehensive program proposal for the California Solar Initiative in a report that shall be filed in this proceeding as part of an ALJ ruling no later than December 15, 2005 and to conduct the proceeding in such a manner as to develop a record on related issues for the Commission's consideration at the first possible opportunity.

This order is effective today.

Dated __________________, at San Francisco, California.