CPX Regulatory Update – July 11, 2019

Regulatory updates for Thursday, July 11, 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 visit http://www.cpuc.ca.gov/documents/


  • A CPUC voting meeting is on schedule for today, July 11. Agenda is HERE. To log in to the livestream, click HERE.
  • In June CPUC President Picker announced that he will be departing the CPUC once a replacement is found – no update.
Regulatory Proceedings we are monitoring:
  1. PG&E Safety Culture Investigation 15-08-019
  2. Power Charge Indifference Adjustment (PCIA)  17-06-026
  3. Resource Adequacy (RA) 17-09-020
  4. SB 790 IOU Code of Conduct 12-02-009
  5. Wildfire Cost Recovery 19-01-006
  6. Utility Wildfire Mitigation Plans (SB 901) 18-10-007
  7. New: Penalties for 2017 Wildfires 19-06-015
  8. PG&E Bankruptcy (no formal docket #)
  9. Integrated Resource Plans (IRP) 16-02-007
  10. Distribution Resource Plans (DRP) 14-08-013 
  11. Renewables Portfolio Standard (RPS) 18-07-003
  12. Integrated Distributed Energy Resources 4-10-003
  13. Direct Access 19-03-009
  14. NEM Successor Tariff 14-07-002
Closed proceedings that matter:
  1. CCA Rulemaking; Bond and Re-Entry Fees – 03-10-003 and 18-05-022
Other non-adjudicatory activities:
  • Customer Choice Project
  • AB 2514 Implementation (Energy Storage)


  1. PG&E Safety Culture Investigation I. 15-08-019

New Developments:

  • Order establishing process for parties to comment on proposals to improve PG&E safety Key proposals presented in the Order:
    • Separating PG&E into separate gas and electric utilities or selling the gas assets;
    • Establishing periodic review of PG&E’s Certificate of Convenience and Necessity (CPCN);
    • Modification or elimination of PG&E Corp.’s holding company structure;
    • Linking PG&E’s rate of return or return on equity to safety performance metrics.
  • Motion to Amend June 18, 2019 Assigned Commissioner and ALJ’S Ruling to align it with the scope of the Proceeding
  • The Public Advocate’s Office filed a Motion to Amend the scope of the Order.
    • Minimum safety and performance prerequisites.
    • Alternatives to PG&E.
  • Interim Decision ordering reporting of PG&E Directors’ safety qualifications by August 1 and establishing CPUC advisory panel on corporate governance.

Major Issues:

  • PG&E’s role in achieving CA’s GHG goals; PG&E’s operational integrity; PG&E’s role in its service territory; Costs passed on to ratepayers.

Key Documents:

  • Order extending statutory deadline to May 8, 2020

Next Steps:

  • July 16 – Respond to Public Advocate’s Office Motion
  • July 19 – Opening comments on the Order
  • August 1 – PG&E to report on Board’s safety qualifications
  • August 2 – Reply comments on the Order
  • May 8, 2020 – Deadline to conclude proceeding

Background: In this case, Center for Climate Protection 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.

  1. Power Charge Indifference Adjustment (Proceeding #R.17-06-026)

New Developments:

  • Ex Parte between SDG&E and Comm. Picker.
  • Group 1 (benchmark and true-up) Final Report workshop 1 and workshop 2.
  • Group 2 (prepayment) workshop 2 workshop 1.
  • Group 3 (portfolio optimization/auction) First Progress Report, workshop 1.

Key Documents:

  • Order Instituting Rulemaking.
  • Scoping Memo.
  • Decision 18-10-019 modifying the PCIA.
  • Joint Petition for Modification of Track 1 Decision D.18-07-009.
  • Applications for re-hearing of Decision 18-10-019 by POC, CLECA and DACC, CalCCA, Shell, and PCE/MCE/SCP
  • Phase 2 Scoping Memo.

Working Groups and co-chairs for Phase 2:

  1. Benchmark true-up and related issues – PG&E, CalCCA.
  2. Prepayment − SDG&E, AreM/DACC.
  3. Portfolio Optimization & Cost Reduction – SCE, CalCCA.
    1. Voluntary allocation and auction proposal – Commercial Energy.

Next Steps (Tentative):

  • July 25 – Group 3 second workshop
  • July 26 – Group 2 second update
  • September – Proposed decision on Group 1 issues 1 – 7
  • September 26 – Group 3 second update
  • October 2019 – Commission vote on Group 1 issues 1 – 7
  • November 2019 – Resolution of Group 1 issues
  • December 9 – Group 2 Final Report


The PCIA is a fee charged to pay for a utility’s stranded cost of procuring electricity on behalf of customers departing for in CCAs or as Direct Access customers. On October 11, 2018 the CPUC voted to accept the Alternate Proposed Decision that significantly increased the PCIA.

  1. Resource Adequacy (17-09-020)

New Developments:

  • On June 27 the Proposed Decision adopting local and flexible capacity obligations 2020-2022 was passed;
    • Comments by CalCCA, SDG&E regarding load migration;
  • May 22 workshop by Shell; Summary prepared by Shell
  • CAISO Local Capacity Study
  • Comments on Workshop and Track 3 proposals by CalCCA, PG&E, CAISO.
  • RA Workshops Outline.

Also See:

  • June 14 comments of the California Community Choice Association on Track 3 Proposed Decision.
  • Opening comments of MCE Clean Energy and Sonoma Clean Power on the Track 3 Proposed Decision

Key Documents:

  • Track 1 Decision D.18-06-030 Adopting Local Capacity Obligations and Refinements to the RA program
  • 18-06-031 adopting flexible capacity obligations for 2019
  • Email ruling on Energy Division Effective Load Carrying Capacity Proposal
  • Proposed Decision endorsing IOUs as Central Buyer for local RA
  • Ruling on Effective Load Carrying Capacity Proposal
  • Comments on the Proposed Decision

Major Issues:

CCA participation in the year-ahead RA showing, Cost allocation due to load migration, Reducing backstop procurement, Consolidating procurement using a central buyer, Updates to Effective Load Carrying Capacity modeling methods, Aligning the Commission’s RA measurement hours with CAISO’s.

Next Steps: 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.

  1. 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.

  1. Wildfire Cost Recovery (19-01-006)

New Developments

  • Proposed Decision finding PG&E ineligible for Stress Test
    • PG&E Comments rejecting the Proposed Decision
    • TURN’s Comments requesting ratepayer reimbursement
  • Report from CA Commission on Catastrophic Wildfire Cost and Recovery
  • Staff Proposal for “Stress Test” methodology; Stress Test Workshop slides.
  • Comments on the staff report by PG&E, TURN, City and County of San Francisco. City and County of San Francisco
  • June 18 – Wildfire recovery costs estimated at $50B – Sac Bee

June 27 – Voting on Proposed Decision. PASSED.

Special note:

There is currently bill relevant to this proceeding making its way through the legislative process. AB 235 introduced by Chad Mayes (Dist. 42, Yucca Valley, R). The bill authorizes the CPUC, when determining recovery by an electrical corporation for costs and expenses arising from a catastrophic wildfire occurring on or after January 1, 2019, to consider the electrical corporation’s financial status and determine the maximum amount the corporation can pay without harming ratepayers or materially impacting the electrical corporation’s ability to provide adequate and safe service. The bill is now on the Senate Energy Committee with no hearing date scheduled.

Major Issues:

  • How much a utility can be required to pay out of pocket?
  • What are the costs that a utility can legitimately pass on to ratepayers?
  • What will be used as a cost recovery calculation methodology?

Key Documents:

  • Comments by Mendocino/Napa/Sonoma Counties, PG&E, San Francisco City Attorney.
  • Order Instituting Rulemaking.
  • SB 901 (Dodd)
  • Scoping Memo.

Next Steps: TBD

Background: The CPUC’s R.19-01-006 is a proceeding to implement Public Utilities Code Section 451.2 regarding criteria and methodology for wildfire cost recovery pursuant to Senate Bill 901 (2018). Major questions include:

  1. Utility Wildfire Mitigation Plans (SB 901) 18-10-007


  • IOU wildfire mitigation plans were approved at the May 30 CPUC voting meeting.
  • Assigned Commissioner and Administrative Law Judge’s June 14 Ruling launching Phase 2 of the Wildfire Mitigation Plan proceeding.

Background: Senate Bill 901 requires electric utilities to prepare and submit wildfire mitigation plans that describe the utilities’ plans to prevent, combat, and respond to wildfires affecting their service territories. Through a proceeding it opened on Oct. 25, 2018 (R.18-10-007), the CPUC will review the initial plans, and develop and refine the content of and process for review and implementation of wildfire mitigation plans to be filed in future years.

  1. NEW: Penalties for 2017 Wildfires (I.19-06-015)

This is a newly opened Investigation that we will monitor

Issue: Possible PG&E violation of Public Utilities Code.

Key Documents:

  • Order Instituting Investigation
    • Commission’s Safety and Enforcement Division finding PG&E violated Commission General Orders and Resolution E-4148 and failed to follow industry best practices.

Next Steps:

  • July 29 – Responses to OII
  • August 5 – PG&E report in response to questions in OII
  1. PG&E Bankruptcy (no docket #) (PG&E Fires Restructuring, Bankruptcy Court, CA Senate Oversight Hearings, US District Court) In addition to the above proceedings, we are also keeping a close eye on the PG&E bankruptcy, which is playing out in four arenas: the bankruptcy court, the CPUC, the CA State legislature, and the Federal Energy Regulatory Commission (FERC).

New Developments

  • CA Legislature fast-tracking legislation (AB 1054) to address IOU viability – on the Assembly Floor today
  • Settlement agreement with 18 public agencies
  • Bondholder’s $30 billion plan, $16 – $18 million for victims
  • Newsom’s $21 billion plan, renews $2.50 monthly DWR charge for 15 years
  • Ruling denying FERC jurisdiction over PPA agreements
  • PG&E Motion for Protective Order
  • 2,500 acre fire on Tuesday July 25 caused by downed PG&E line. No injuries.
  • $105 million immediate assistance for wildfire victims
  • Commission approves PG&E’s Wildfire Mitigation Plan.
  • PG&E Quarterly Earnings Report reveals SEC investigation. Statement by PG&E.
  • PG&E hires former TVA CEO Bill Johnson.
  • PG&E will propose increasing its Board to 15 directors at the Annual Shareholders


  • US District Court Probation Order suspending dividends until PG&E complies with vegetation management and wildfire mitigation plan.

Major Issues:

  • Chapter 11 removes restructuring authority to the Federal Bankruptcy Court.
  • PG&E’s ability to recover wildfire litigation and liability costs via rate increases.
  • The scope and role of PG&E when it emerges from bankruptcy restructuring.
  • Future role of CCAs, distributed energy resources, and distribution utility.

Key Documents:

  • Cal Fire report finding PG&E equipment involved in 12 fires during October, 2017.
  • Ruling and Scoping Memo regarding phase 2 15-08-019 Investigation Into PG&E’s Safety Culture
  • Fire Safety and Utility Infrastructure En Banc

Next Steps:

  • Sept 28 – Deadline for PG&E to propose reorganization plan
  1. Integrated Resource Planning (R.16-02-007)

New Developments:

  • June 20 – Assigned commissioner and Administrative Law Judge’s RULING initiating procurement track and seeking comment on potential reliability issues. Comments are due no later than July 15, 2019. Reply comments are due no later than July 25, 2019.
  • CalCCA Motion for amended ruling seeking the staff analysis identifying the “potential for near-term reliability challenges” cited in the Ruling.
  • Final Decision adopting the Reference System Plan as the Preferred System Plan. o SEA Analysis of the Final Decision
    • SEA Analysis of the Proposed Decision.
  • Comments on the PD by SDG&E, CalCCA, CAISO, Calpine, SEA .
  • Reply comments by SDG&E, CalCCA, CAISO, Calpine.

Key Documents:

  • Order Instituting Rulemaking
  • Decision D.18-02-018 setting IRP requirements for LSEs
  • Amended Scoping Memo
  • Ruling on production cost modeling approach and schedule for preferred system plan development
  • Ruling seeking comment on policy issues and options related to reliability
  • Ruling seeking comments on inputs and assumptions for development of the 2019-2020 Reference System Plan

Major Issues:

  • Near, medium, and long-term local reliability needs.
  • Approval of a Preferred System Plan.
  • How to co-ordinate LSE procurement to meet CA GHG goals.

Next Steps:

  • July 15 – Party Comments on the Procurement Track.
  • July 25 – Reply Comments.
  • July 29 – Comments on procurement track (tentative).
  • Late 2019 – Proposed Decision on Procurement Track.
  • August 16, 2019 – LSEs to provide informal IRP resource contract and development status reports. Can be submitted confidentially.

Background: On April 25 the CPUC unanimously approved a Proposed Decision that approves or certifies 20 individual LSE IRPs. Grants exemptions to 9 LSEs. Requires another 19 LSEs to refile their individual IRPs as Tier 2 advice letters, with additional information about the criteria pollutants associated with serving their load. It also adopts a Preferred System Portfolio to use as the basis for future planning and to transfer to the CAISO for use in its Transmission Planning Process (TPP) as the reliability base case and policy-driven base case. Lastly, it requires LSEs serving load in the territory of PG&E to include in their next IRPs a section addressing retirement of Diablo Canyon. The decision primarily relies on Community Choice agencies to procure the new clean energy resources the State needs over the next decade to achieve California’s renewable energy and GHG emissions reduction targets attributable to the State’s electricity sector. A video of the proceeding is HERE. Item 51 on the agenda. The CPUC’s action represents a major vote of confidence in the critical role CCAs are playing in California’s rapidly evolving energy system.

  1. Distribution Resource Plans (14-08-013 )

No update.

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.

  1. Renewable Portfolio Standard (R.18-07-003)

New Developments:

  • July 2 Proposed Decision implementing SB100
    • 44% for 2021-2024 by December 31, 2024; 52% for 2025-2027 by December 31, 2027; 60% for 2028-2030 by December 31, 2030
    • Progress assessed using “straightline” method in D.11-12-020
    • No Comments against the PD
  • Schedule of Review for 2019 RPS Plans.
    • Updated Schedule
    • July 21, 2019–IOUs, ESPs, and CCA RPS procurement plans deadline

Major Issues:

  • Revising RPS renewable market adjusting tariff (ReMAT) and bioenergy market adjusting tariff (BioMAT).
  • Least-cost/best-fit methodology for RPS procurement
  • Cost containment for IOU RPS procurement
  • Co-ordination with the IRP proceeding
  • Monitoring and review of LSE compliance.

Key Documents:

  • 12-06-038 setting RPS compliance rules.
  • OIR to further develop the RPS program.
  • 2018 RPS Annual Report to Legislature.
  • Amended Scoping Memo.
  • Proposed Decision adopting 2018 RPS procurement plans.
  • Comments on Proposed Decision by CCA Parties.
  • 19-02-007 accepting draft 2018 RPS plans filed by LSEs.
  • Comments on SB 100 implementation from CCAs and PG&E.
  • Reply comments from Joint CCAs and Joint Utilities.

Next Steps:

  • July 19 – Comments on plans and coordination with IRP proceeding.
  • August 2 – Deadline for Motion to request evidentiary hearings.
  • August 2 – Reply comments on RPS plans.
  • August 23 – Updates to RPS procurement plans.

Background: The RPS program implements SB 350 and SB 100 by requiring all LSEs to increase their procurement of renewable energy to 44% by 2024, 52% by 2027, 60% by 2030, and 100% by 2045.

  1. Integrated DER – No new developments. Recent ALJ Rulingdirecting 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.


  1. Direct Access Rulemaking (SB 237) – 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.


  1. 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


Closed proceedings that matter: 

  1. CCA Bond Requirements and Re-entry Fees – No new developments. Background: Rulemaking R.03-10-003 was initiated in October 2003 to implement portions of AB 117concerning Community Choice Aggregation. That Rulemaking is closed. One result of the proceeding was Decision 18-05-022issued on May 31, 2018 which established reentry fees and financial security requirements applicable to CCAs as required by Public Utilities Code Section 394.25(e). The IOUs were ordered to provide a Tier 1 Advice Letter detailing their costs and to identify that in their general rate cases. CCA parties assert that the Advice Letters submitted by the utilities are overly broad and exceed the scope permitted in D.18-05-022 because they would impose liability on returning CCA customers over and above the CCA Bond amount, permit the utility to dictate whether financial instruments and arrangements were satisfactory, and require that particular agreements drafted by the utility be used to satisfy a financial security amount.
  1. CCA Rulemaking03-10-003This was the original rulemaking that occurred between 2003 and 2005 to cross the Ts and dot the Is on CCA law.

Other regulatory matters:

Customer Choice Project. No update. This is an informal activity in progress that relates directly to CCAs, the California Customer Choice Project (formerly known as the “Green Book”). The Center submitted Comments on this matter in June 2018.

AB 2514 Energy Storage Mandate. Lastly, all LSEs in California are required to procure certain levels of storage under the Energy Storage Mandate in AB 2514. The CPUC oversees the implementation. Recent news is that due to CCA customers paying for IOU procurement of storage via nonbypassable charges, the obligation for CCAs to meet the mandate has been dismissed.



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