Peevey Ruling and Scoping Memo Establishing Schedule For Phase Two of the Renewable Portfolio Standard Proceeding

RPS Plan

The utilities are directed to prepare and file an RPS plan that accomplishes three things: attainment of RPS goals for 2005 (in light of the still-pending 2004 RPS solicitations); a detailed plan for RPS procurement over the period 2005-2014, with an emphasis on achieving the 20% RPS goals in 2010 and including necessary transmission expansion; and a plan for attaining the optimum amount of generation from re-powered renewable facilities presently under contract to the utility. All three components of the plan should incorporate lessons learned during the 2004 RFP solicitations.

We note the direction in the Long-Term Procurement Planning proposed decision (mailed 11/16/04 in Rulemaking (R.) 04-04-003), ordering the utilities to file in this docket robust renewable procurement plans that will achieve the 2010 RPS goal. The Proposed Decision finds that the "renewable procurement sections in SCE's and PG&E's LTPPs (Long Term Procurement Plans) are inadequate and need revision." (Id., p.73.) The utilities should follow the guidance of the Proposed Decision, when it is finalized and approved by the Commission, regarding the contents of their 2010 plans. We need to begin this planning process now, and insufficient utility plans will not be accepted here.

In preparation for the 2005 RPS solicitation round, the utilities should also submit a draft 2005 plan that comports with the requirements of Pub. Util. Code § 399.14(a)(3), which include:

1. An assessment of annual or multiyear portfolio supplies and demand to determine the optimal mix of renewable generation resources with deliverability characteristics that may include peaking, dispatchable, baseload, firm, and as-available capacity;

2. Provisions for employing available compliance flexibility mechanisms established by the Commission; and

3. A bid solicitation setting forth the renewable generation of each deliverability characteristic, required online dates, and locational preferences, if any.

We recognize that, with the 2004 RPS solicitations still pending, it will be difficult for the utilities to precisely identify their 2005 RPS needs in these plans. We emphasize that these are draft plans, which will be refreshed as the 2004 solicitations result in approved power purchase agreements, and utility needs change accordingly. The utilities are to make their best approximations of their annual procurement targets for 2005. Further changes to these 2005 plans may also be necessary following review of the results from 2004 by parties and the Commission. We anticipate that the 2005 RPS solicitations will take place in the fourth quarter of the year.

As a third and final element of these plans, the utilities should also address the treatment of potential repowering by facilities presently under contract. The utilities should identify their preferred policy approaches to this issue, including substantial arguments in support, and describe necessary Commission actions to effectuate these preferred policies.

These tripartite RPS plans - to achieve goals in 2005 and 2010, and to properly address re-powering opportunities - are to be filed by the utilities by February 17, 2005. Parties may file comments on, and/or counterproposals to, all issues under discussion in the plans on March 17, 2005. Reply comments are due on March 31, 2005.