CPX Regulatory Update – December 12, 2019

Below is a numbered list of the regulatory proceedings we are tracking, followed by a summary of new developments for each of the proceedings, if any. Note that these are intended as very brief highlights of selected key actions and activities. For details on any of these proceedings, we suggest logging in to the relevant proceeding page on the CPUC’s website. An expedient way to do that is to click on the proceeding number below or visit http://www.cpuc.ca.gov/documents/

Brief Notes: The next CPUC voting meeting is on schedule for December 19 at CPUC headquarters. See AGENDA. For the livestream, click HERE.
We continue to monitor wildfire and PG&E bankruptcy-related proceedings but no longer report on those items on a regular basis. We will report occasionally on any significant developments.

Regulatory Proceedings we are monitoring:

1. SB 1339 Microgrid Rulemaking R.19-09-009
2. PG&E Safety Culture Investigation 15-08-019
3. Power Charge Indifference Adjustment (PCIA) 17-06-026
4. Resource Adequacy (RA) 17-09-020
5. Self Generation Incentive Program (SGIP) R.12-11-005
6. SB 790 IOU Code of Conduct 12-02-009
7. Integrated Resource Plans (IRP) 16-02-007
8. Distribution Resource Plans (DRP) 14-08-013
9. Renewables Portfolio Standard (RPS) 18-07-003
10. Integrated Distributed Energy Resources 4-10-003
11. Direct Access 19-03-009
12. NEM Successor Tariff 14-07-002

Closed proceedings that matter:

– CCA Rulemaking 03-10-003
– CCA Bond and Re-Entry Fees 18-05-022

~ ~ ~

1. Microgrids (SB 1339) – R.19-09-009

The Climate Center is a Party to this proceeding. Read our October 21, 2019 Opening Comments HERE.

Recent Developments:

Order Instituting Rulemaking (Issued 9/19/19).
Major Issues:

  • Role of CCAs in microgrid development
  • Microgrid operation, value, and technical challenges
  • Microgrid regulation and service standards
  • How microgrids can improve the grid and further policy goals.

Key Documents:

Next Steps:

  • December 12 – Workshop
  • December 17 – Prehearing Conference

Background: Sponsored by Sen. Henry Stern in 2019, SB 1339 was born out of concern that California needs microgrids, but their development is hobbled. The law and rulemaking are intended to boost microgrid development and streamline project interconnections.

 

2. PG&E Safety Culture Investigation 15-08-019

Recent developments:

  • PG&E’s 4th Quarterly Report
  • Notice of re-assignment to President Mary Batjer
  • Comments from CC, PG&E, TURN, Institutional Equity Investors
  • Reply Comments from City and County of San Francisco, PG&E, PAO
  • Order establishing process for parties to comment on proposals to improve PG&E
    safety.

Major Issues:

  • PG&E’s ability to maintain a safe transmission and distribution system

Key Documents:

  • Order extending statutory deadline to May 8, 2020

Background: In this case, The Climate Center is a Party to the Proceeding. Read our Opening Comments HERE. The investigation originated after the San Bruno incident, and has been reinvigorated due to the 2017/18 wildfires.

 

3. Power Charge Indifference Adjustment (PCIA) (R.17-06-026)

New and recent developments:

  • Working Group 3 workshop #3 Presentation
  • Decision 19-10-001  on market price benchmark and true up (WG1 issues 1 – 7)

Key Documents:

Next Steps:

  • December 9 – Group 2 Final Report
  • December 11 – WG 3 workshop #4
  • January 30 – WG 3 Report Due
  • Q1 2020 – Proposed Decision on Groups 2 issues
  • Q2 2020 – Resolution of Group 3 issues.

Background: The PCIA is a fee charged to CCAs to pay for a utility’s stranded cost of procuring electricity on behalf of customers departing in CCAs.

 

4. Resource Adequacy (Was 17-09-020) (Now R.19-11-009)

New and recent developments:

  • There is a new RA proceeding number for 2021-2022 R.19-11-009.
    • Comments by CalCCA, SanFrancisco, PG&E, CAISO.
  • CAISO Application for Rehearing of D.19-10-021.
  • CalCCA Application for Rehearing and Motion for Stay of D.19-10-021
    • Responses in support by CAISO, Shell, Calpine
    • Decision 19-10-021 re RA Import Rules
  • Proposed Decision to determine qualifying capacity (QC) value of hybrid resources (generation + storage)
    • Comments on the Motion by CalCCA and SDG&E
  • Cal Advocates Protest of RA waivers
    • 3 Phases Renewables, CleanPowerSF, Constellation, Direct Energy, EDF, Just Energy Solutions, Pilot Power Group, San Jose Clean Energy, and Shell submitted summaries but not documentation that they solicited bids.
  • CalCCA Petition for Modification of D.19-06-026 adopting capacity obligations
    • Market conditions justify a waiver process for System and Flex RA similar to Local RA because solicitations and bilateral market inquiries are not producing offers at commercially reasonable prices and in some instances produce no offers at all
    • Citations:$150,109 in 2017; $9,201,172 in 2019
    • Several IOUs did not offer RA for sale until after the October 31 deadline
    • Assemblymembers and State Senators noted that RA pricing has doubled between 2018 and 2019. They suggested that the IOUs’ failure to offer excess RA to the market in a timely manner has created an artificial shortage of RA supply.

Next Steps:

  • Jan 12, 2019 – Possible vote on hybrid resources qualifying capacity.
  • Ruling on Applications for Rehearing of D.19-10-021 – TBD
  • Decision on RA central procurement entity – TBD

Background: The RA program is designed to provide adequate electric resources to CAISO to ensure safe and reliable operation of the grid, and to provide appropriate incentives for the siting and construction of new resources needed for reliability. This proceeding has been divided into three Tracks due to the complexity of the issues involved.

 

5. Self-Generation Incentive Program R.12-11-005

Recent Developments:

Decision (issued 9-18-19) modifying equity budget program requirements and incentive levels to increase participation. Establishes a new equity resiliency budget set-aside for vulnerable households located in Tier 3 and Tier 2 high fire threat districts, critical services facilities serving those districts, and customers located in those districts that participate in two low-income solar generation programs Effective 4-1-20.

Appendix A modifications
Appendix B remaining funds
Appendix C testing standards for storage

Program administered by PG&E, SCE, SoCalGas, Center for Sustainable Energy.

Next Steps:

  • December 18, 2019 – Administrators’ joint Tier 2 advice letter due
  • January 18, 2020 – Commission heat pump workshop due
  • January 31, 2020 – Administrators to submit Tier 1 advice letter containing final SGIP accounting data as of December 31, 2019
  • April 1, 2020 – SGIP modifications effective
  • March 31, 2021 – Tier 2 advice letter re the 2021- 2025 SGIP evaluation plan.

 

6. SB 790 IOU Code of Conduct (12-02-009) – No new developments.

Background: Original CCA law, AB 117 stipulates that IOUs must “cooperate fully” with local governments pursuing Community Choice. In the mid-to-late 2000s, San Francisco, Marin, and the San Joaquin Valley experienced egregious disinformation campaigns waged by the incumbent utility for these jurisdictions against their efforts. The obstruction was documented in a series of California Senate Select Committee on Renewable Energy hearings in 2010 chaired by Senator Mark Leno. The result of the hearings was SB 790, which created an IOU Code of Conduct that prohibits IOUs from marketing against CCAs unless they establish a separate marketing division that does not use ratepayer funds, among other provisions.

 

7. Integrated Resource Plans – R.16-02-007

New Developments:

  • Application for Rehearing D.19-11-016
    • CEJA, Sierra Club, Defenders of Wildlife, PAO.
  • D.19-11-016 requiring reliability procurement
    • OTC plants should remain online
    • Incremental procurement of 3,300 MW of system-level RA by all LSEs (50% by Aug 1, 2021. 75% by 2022, 100% by 2023)
    • LSEs that do not self-procure will be allocated costs by the IOU based on CAM, not PCIA
    • Procurement contracts of new resources shall be for at least 10 years.

Energy efficiency shall be for 5 years, existing resources shall be 3 years. o IRPplansshalldetailprojects,capacities,anddatesbywhichtheLSE expects the projects to be providing service and demonstrate that the projects are incremental to meet the 2021, 2022, and 2023 requirements.

Key Documents:

  • Order Instituting Rulemaking.
  • Decision D.18-02-018 setting IRP requirements for LSEs.
  • Amended Scoping Memo.
  • Final Decision adopting the Reference System Plan as the Preferred System Plan.

Next Steps:

  • February 15, 2020 – LSE summaries of incremental RA procurement
  • May 1, 2020 – Updated LSE contract data in IRP plans. Standing data request for

Major Issues:

  • Near, medium, and long-term local reliability needs
  • Approval of a Preferred System Plan
  • Co-ordinating LSE procurement to meet CA GHG goals
  • Non-IRP filing years.

 

8. Distribution Resource Plans (14-08-013 ) – No new updates.

August 9 – Ruling postponing capacity analysis workshop.

Background: This proceeding consolidates numerous previous proceedings and seeks to establish policies and rules for IOUs to develop Distribution Resources Plan Proposals, and to evaluate the IOUs’ infrastructure and planning to incorporate distributed energy resources (DERs) into their systems. There are three parallel and concurrent Tracks in this proceeding. Track 1 concerns methodological issues. Track 2 concerns demonstration and pilot projects. Track 3 concerns policy issues.  Decisions have been issued on all three tracks, but there are still residual issues and new issues being addressed.

 

9. Renewables Portfolio Standard (RPS) R.18-07-003

New and recent developments:

  • Proposed Decision on 2019 RPS Plans
    • LSEs must demonstrate a path to SB350 long-term contracting requirements
    • Workshops to combine RPS with IRP plans.
  • Decision re IOU Effective Load Carrying Capability. Customer-side-of-the-meter Photovoltaic (PV) must be treated as a supply-side resource; annual loss of load expectation study must be conducted
    • Comments by PG&E.
  • Decision enforcing RPS program rules, fining Liberty Power $431,014 and Gexa $1,725,461.
  • Joint Utility comments and Joint CCA reply comments on combining IRP and RPS programs.
  • Updated Schedule of Review for 2019 RPS Plans.Key Documents:• •
    • Decision implementing SB100.
    • D.12-06-038 setting RPS compliance rules.
    • OIR to further develop the RPS program.
    • 2018 RPS Annual Report to Legislature.
    • Amended Scoping Memo.Next Steps:
    • Dec 9, 2019 – Comments due on RPS PD.
    • Dec 19, 2019 – Possible vote on RPS PD.
    • March 31, 2020 – Energy Division to initiate workshops.

 

10. Integrated DER – No new developments.

Most recent development: ALJ Ruling directing responses to post-March 4-5, 2019 Workshop questions.

Background: Since 2007, the Commission has sought to integrate demand side energy solutions and technologies through utility program offerings. Decision (D.07-10-032) directs that utilities “integrate customer demand-side programs, such as energy efficiency, self-generation, advanced metering, and demand response, in a coherent and efficient manner.” The Commission’s IDER Action Plan published in 2016 remains in draft form.

 

11. Direct Access Rulemaking (19-03-009) – No new developments.

On March 14, 2019 CPUC issued an Order Instituting Rulemaking (OIR) for proceeding R. 19-03-009 regarding implementation of Senate Bill 237 (SB 237 – Hertzberg) concerning expansion of the Direct Access (DA) program. DA is available to non-residential customers. Background: DA access was restricted after the energy crisis by SB 1X. DA access is currently capped and accessible via a lottery system, with 7,603 GWh of load on the waitlist. SB 237 increases the maximum total annual kilowatt-hours allowed under the DA program by a total of 4,000 GWh apportioned among the three IOU service territories. That increase must be implemented by June 1, 2019. SB 237 also gives CPUC until June 1, 2020 to provide the legislature with guidance on expanding DA access to all interested non-residential customers. The proceeding will have two phases to address the two mandates.

 

12. NEM Successor Tariff Rulemaking R.14-07-002

Pursuant to direction in the NEM Successor Tariff Decision, the Commission will review the NEM successor tariff some time in 2019, when the proceedings related to distributed energy resources are completed and after default TOU rates are implemented. Energy Division staff will explore compensation structures for customer-sited distributed generation other than NEM, as well as consider an export compensation rate that takes into account locational and time-differentiated values. On April 26, 2019, the Energy Division distributed a Revised Solar Information Packet to service list R.14-07-002 and R.12-11-005.  The Energy Division asked for written comments about the content of the Revised Solar Information Packet and implementation approach.  The deadlines for submitting written comments has passed. If you have questions contact Kerry Fleisher at the CPUC Energy Division: Kerry.Fleisher@cpuc.ca.gov

That’s all for this update. Next Update will be on January 9. Have a great holiday break!

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