CPUC Public Agenda 3291Thursday, March 22, 2012, 9:00 a.m.505 Van Ness Ave, San Francisco

Commissioners: Michael R. Peevey

Timothy Alan Simon Michel Peter Florio

Catherine J.K. SandovalMark J. Ferron

www.cpuc.ca.gov

Public Comment• Per Resolution ALJ-252, any member of the public who wishes to address the CPUC about matters before the Commission must either sign up at the Commission's webpage section "Public Comment Sign-Up" or with the Public Advisor before the meeting begins.

• Public speakers must visit the Public Advisors table before the start of the meeting on the day of the Commission Meeting to ask our staff to mark their presence.

• Once called, each speaker has up to 3 minutes at the discretion of the Commission President, depending on the number of speakers.

• A sign will be posted when 1 minute remains.

• A bell will ring when time has expired.

•Those who sign up after 9:00 a.m. will only have 1 minute.

The following items are NOT subject to Public Comment:Item: 19, 29, 30, 34, 36, 45 & 50All items on the Closed Session Agenda

Public Comment• Per Resolution ALJ-252, any member of the public who wishes to address the CPUC about matters before the Commission must either sign up at the Commission's webpage section "Public Comment Sign-Up" or with the Public Advisor before the meeting begins.

• Public speakers must visit the Public Advisors table before the start of the meeting on the day of the Commission Meeting to ask our staff to mark their presence.

• Once called, each speaker has up to 2 minutes to address the Commission.

• A sign will be posted when 1 minute remains.

• A bell will ring when time has expired.

•Those who sign up after 9:00 a.m. will only have 1 minute.

The following items are NOT subject to Public Comment:Item: 19, 29, 30, 34, 36, 45 & 50All items on the Closed Session Agenda

Public Comment• Per Resolution ALJ-252, any member of the public who wishes to address the CPUC about matters before the Commission must either sign up at the Commission's webpage section "Public Comment Sign-Up" or with the Public Advisor before the meeting begins.

• Public speakers must visit the Public Advisors table before the start of the meeting on the day of the Commission Meeting to ask our staff to mark their presence.

• Once called, each speaker has up to 1 minute to address the Commission.

• A bell will ring when time has expired.

•The following items are NOT subject to Public Comment:Item: 19, 29, 30, 34, 36, 45 & 50All items on the Closed Session Agenda

Agenda Changes• Items shown on the Consent Agenda will be taken up and voted on as a group in one of the first items of business of each CPUC meeting.

• Items on Today’s Consent Agenda are: 1, 3, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 32, 33, 34, 35, 36, 37, 38, 39 & 40

• Any Commissioner, with consent of the other Commissioners, may request an item from the Regular Agenda be moved to the Consent Agenda prior to the meeting.Items: 50, 52, 53, 56, 57, 58, 60, 63, 64, 65, 68, & 69 from the Regular Agenda have been added to the Consent Agenda.

• Any Commissioner may request an item be removed from the Consent Agenda for discussion on the Regular Agenda prior to the meeting. Item: 7 has been moved to the Regular Agenda.

• Items: 2, 54, 55 & 61 have been withdrawn.

• The following items have been held to future Commission Meetings:

Held to 4/19/12: 4, 5, 31, 41, 41a, 43, 43a, 44, 45, 46, 46a, 48, 59, 62, 66, 67 & 70

Held to 5/10/12: 6

Regular Agenda

• Each item on the Regular Agenda (and its alternate if any) will be introduced by the assigned Commissioner or CPUC staff and discussed before it is moved for a vote.

• For each agenda item, a summary of the proposed action is included on the agenda; the CPUC’s decision may, however, differ from that proposed.

• The complete text of every Proposed Decision or Draft Resolution is available for download on the CPUC’s website: www.cpuc.ca.gov.

• Late changes to agenda items are available on the Escutia Table.

Regular Agenda – Energy OrdersItem #42 [10979] Continuation of Existing Rules and Adoption of New Rules Governing Service Disconnection Practices of Pacific Gas and Electric Company and Southern California Edison Company

R10-02-005Order Instituting Rulemaking on the Commission’s Own Motion to Address the Issue of Customers’ Electric and Natural Gas Service Disconnection.

Quasi-Legislative Comr. Florio/ Judge Ebke----------------------------------------------------------------------------------------------------------------

PROPOSED OUTCOME:

• Continues existing rules in effect and adopts new rules to remain in effect until December 31, 2013, subject to a benchmark provision that may allow the rules to cease effectiveness before that date.

• Closes the proceeding.

ESTIMATED COST:

• $453,000 for Southern California Edison Company and $4.8 million for Pacific Gas and Electric Company as of March 2011.

• These amounts are increasing over time.

Regular Agenda – Energy OrdersItem #43 [11047] Pacific Gas and Electric Company to Invest $9.9 Million of Ratepayer Funds in a Solar Manufacturing Development Facility

A10-11-002Application of Pacific Gas and Electric Company for Authority to Increase Electric Rates and Charges to Recover Costs Relating to California Solar Photovoltaic Manufacturing Development Facility.

Ratesetting Comr. Peevey/ Judge Bemesderfer-----------------------------------------------------------------------------------------------------

PROPOSED OUTCOME:

• Denies the application of Pacific Gas and Electric Company to invest $9.9 million of ratepayer funds in Silicon Valley Technology Corporation.

• Closes the proceeding.

ESTIMATED COST:

• None.

Regular Agenda – Energy OrdersItem #43a [11048] ALTERNATE TO ITEM 11047

A10-11-002Application of Pacific Gas and Electric Company for Authority to Increase Electric Rates and Charges to Recover Costs Relating to California Solar Photovoltaic Manufacturing Development Facility.

Comr. Peevey---------------------------------------------------------------------------------------------------------------

PROPOSED OUTCOME:

• Approves the application.

• Finds that the Manufacturing Developing Facility (MDF) is similar to research and development programs that the California Public Utilities Commission (Commission) has financed through ratepayer surcharges in the past.

• The Alternate Proposed Decision (APD) notes that construction of the MDF is consistent with the Commission’s program of encouraging utilities to increase their use of renewable resources; is supported by substantial grant funding from the United States Department of Energy; and that, as a research and development project, it is not expected to earn a return.

• The APD finds that the likelihood of reducing the cost of solar photovoltaic technology is a sufficient justification for the investment of ratepayer funds.

• Closes the proceeding.

ESTIMATED COST:

• None.

Regular Agenda – Energy Resolutions and Written Reports

Item #7 [10979] San Diego Gas & Electric Company's Renewable Energy Power Purchase Agreement, as Amended, With Energia Sierra Juarez U.S., LLC

Res E-4467, Advice Letter (AL) 2247-E filed on April 19, 2011 and AL 2247-E-A filed on October 6, 2011 - Related matters.-------------------------------------------------------------------------------------------

PROPOSED OUTCOME:

• Approves cost recovery for the long-term renewable energy power purchase agreement (PPA), as amended, between San Diego Gas & Electric Company and Energia Sierra Juarez U.S., LLC.

• The PPA, as amended, is approved without modification.

ESTIMATED COST:

• Approximately $41 million per year for 20 years.

• Approximately $820 million over the life of the contract (nominal).

Resolution E-4467 (Agenda Item 7)

San Diego Gas & Electric Company (SDG&E) requests approval of a

renewable energy contract, as amended, with Energia Sierra Juarez U.S., LLC

Contract Summary

Facility ResourceContrac

t Length

CapacityAnnual

Deliveries

Location

Energia Sierra Juarez

Wind 20100-156

MW324-422 GWh/yr

Jacume, Baja California Norte,

Mexico

• Resolution E-4467 approves the contract, as amended, without modifications

• Project will located in Mexico and interconnect directly to CAISO via a cross-border generator-tie transmission line to the proposed East County (ECO) substation.

• Project’s expected online date is fourth quarter of 2013

ESJ Connects to ECO Substation• Six different projects are requesting interconnection to ECO substation totaling 2,240 MW.

• Three of the generators, including ESJ, are located in Baja, Mexico.

• ECO substation is connecting to the Southwest Powerlink. The CAISO approval is based on interconnection requests.

• The ECO Substation Project includes the following major components:• Construction of a 500/230/138-kilovolt (kV) substation in Eastern San Diego County

• Construction of the Southwest Powerlink (SWPL) loop-in, a short loop-in of the existing SWPL transmission line to the proposed ECO Substation

• Construction of a 138 kV transmission line, approximately 13.3 miles in length, running between the proposed ECO Substation and the rebuilt Boulevard Substation

• Rebuild of the existing Boulevard Substation.

• The proposed ECO Substation Project would provide an interconnection hub for renewable generation along SDG&E´s existing SWPL 500 kV transmission line. In addition to accommodating the region´s planned renewable generation, the project would also provide a second source for the southeastern 138 kV transmission system that avoids the vulnerability of common structure outages, which would increase the reliability of electrical service for Boulevard, Jacumba, and surrounding communities.

Regular Agenda – Energy Resolutions and Written Reports

Item #7 [10979] San Diego Gas & Electric Company's Renewable Energy Power Purchase Agreement, as Amended, With Energia Sierra Juarez U.S., LLC

Res E-4467, Advice Letter (AL) 2247-E filed on April 19, 2011 and AL 2247-E-A filed on October 6, 2011 - Related matters.-------------------------------------------------------------------------------------------

PROPOSED OUTCOME:

• Approves cost recovery for the long-term renewable energy power purchase agreement (PPA), as amended, between San Diego Gas & Electric Company and Energia Sierra Juarez U.S., LLC.

• The PPA, as amended, is approved without modification.

ESTIMATED COST:

• Approximately $41 million per year for 20 years.

• Approximately $820 million over the life of the contract (nominal).

Regular Agenda – Energy Resolutions and Written Reports

Item #46 [10799] Appeal of Resolution E-4392 Regarding Southern California Edison Company's Notice of Proposed Construction of McGrath 66 Kilovolt Substation Project

Res E-4400, Appeal of Resolution E-4392 Filed on February 14, 2011 - Related matters.------------------------------------------------------------------------------------------

PROPOSED OUTCOME:

• Denies the appeal of Executive Director’s Resolution E-4392, and finds that Resolution E-4392 correctly disposed of the protests to Advice Letter 2517-E-A.

ESTIMATED COST:

• None.

Regular Agenda – Energy Resolutions and Written Reports

Item #46a [11075] ALTERNATE TO ITEM 10799

Res E-4400, Appeal of Resolution E-4392 Filed on February 14, 2011 - Related matters.

Comr. Ferron------------------------------------------------------------------------------------------

PROPOSED OUTCOME:

• This Alternate Resolution finds that Executive Director’s Resolution E-4392 correctly disposed of the protests to Advice Letter 2517-E-A, but grants the appeal based on broader policy considerations.

ESTIMATED COST:

• None.

Regular Agenda – Energy Resolutions and Written Reports

Item #47 [10999] Pacific Gas and Electric Company, Southern California Edison Company and San Diego Gas & Electric Company to Enter Negotiations With Calpine's Sutter Energy Center

Res E-4471------------------------------------------------------------------------------------------

PROPOSED OUTCOME:

• Orders Pacific Gas and Electric Company, Southern California Edison Company and San Diego Gas & Electric Company to negotiate to enter into a contract with Calpine’s Sutter Energy Center to end no later than December 31, 2012.

• Adopts a non-bypassable charge to pay for the cost of the contract.

ESTIMATED COST:

• Not to exceed $2.95 million per month, to a total of $17.4 million.

18

Resolution E-4471, Agenda Item 47Contract with Calpine’s Sutter Energy Center

Edward RandolphDirector, Energy Division

California Public Utilities Commission

March 22, 2012

• Calpine owns Sutter, a 500-525 MW air-cooled, gas-fired combined cycle power plant, located in Yuba City.

• Calpine filed a GO 167 notice on 11/26/2011 that it would retire the Sutter plant in 2012. Calpine simultaneously filed with the CAISO for Capacity Procurement Mechanism designation. The CAISO filed a waiver request with the FERC on 1/25/2012.

• Resolution orders IOUs to negotiate with Calpine for the Sutter plant. – Final price shall not exceed $2.95 million per month or $17.4 million in total– IOUs file a Tier 2 AL on completion of negotiations for Commission approval– Requires use of the Independent Evaluator– “Open Book” financial information provided to Energy Division and the Independent Evaluator– Justifies contracting with Sutter on the basis of it’s pseudo-tie, but not for system, local, or

renewable integration needs– Pseudo-ties and dynamic transfers are likely to play an increasing role for renewable energy and

integration in the future

Resolution E-4471, Agenda Item 47

Regular Agenda – Energy Resolutions and Written Reports

Item #47 [10999] Pacific Gas and Electric Company, Southern California Edison Company and San Diego Gas & Electric Company to Enter Negotiations With Calpine's Sutter Energy Center

Res E-4471------------------------------------------------------------------------------------------

PROPOSED OUTCOME:

• Orders Pacific Gas and Electric Company, Southern California Edison Company and San Diego Gas & Electric Company to negotiate to enter into a contract with Calpine’s Sutter Energy Center to end no later than December 31, 2012.

• Adopts a non-bypassable charge to pay for the cost of the contract.

ESTIMATED COST:

• Not to exceed $2.95 million per month, to a total of $17.4 million.

Regular Agenda – Energy Resolutions and Written Reports

Item #49 [11089] Commission Review of Energy Division's Disposition Approving Southern California Gas Company's Contracts with Three Vendors

Res G-3470, Southern California Gas Company (SoCalGas) Advice Letter (AL) 4245 filed on May 27, 2011 and SoCalGas AL 4245-A filed on October 21, 2011 - Related matters.------------------------------------------------------------------------------------------

PROPOSED OUTCOME:

• Affirms Energy Division disposition letter dated December 12, 2011.

• Grants Southern California Gas Company’s (SoCal Gas) request to execute contracts with Capgemini, Aclara and Agile.

• Grants SoCal Gas’s request for confidential treatment of these contracts.

ESTIMATED COST:

• $1.0396 billion.

Resolution G-3470 SoCalGas AMI Implementation Contracts

• SoCalGas submitted Advice Letters 4245 and 4245-A to seek approval of contracts with three vendors for AMI technology and installation to implement its AMI project as authorized by D.10-04-027.

• DRA and TURN filed a protest to Partial Supplement AL 4245-A which amended one of the three contracts. No other protests were filed.

• Energy Division evaluated the contracts in terms of

the AMI functionality criteria listed in D. 10-04-027.

DRA and TURN Protest

• In their protest to AL 4245-A, DRA and TURN assert that the three contracts do not meet the functionality requirements of D.10-04-027 and recommend that the contracts be rejected.

• DRA and TURN recommend a stay on approval of the contracts until the Commission addresses the DRA/TURN Petition for Modification.

• The DRA/TURN protest to Partial Supplement AL 4245-A includes arguments to reconsider D.10-04-027 which cannot be addressed in an Advice Letter filing.

• The Energy Division has found that the three contracts are in compliance with D.10-04-027.

Energy Division’s Evaluation of Contracts

Energy Division’s evaluation concludes that the contracts will:•Enable SoCalGas to collect usage data at a level of detail that supports customer understanding of usage patterns. •Provide customer access to personal energy usage and are not likely to result in additional AMI system hardware costs. •Be compatible with communications protocols and applications to provide customer education and energy management services.•Be compatible with utility system applications such as remote meter reading, outage management, reduction of theft, improved forecasting, workforce management, etc.

Resolution G-3470 SoCalGas AMI Implementation Contracts

• The DRA and TURN protest to Partial Supplement AL 4245-A is rejected because the protest includes arguments to reconsider D.10-040027. Advice letter process is not an appropriate vehicle to reconsider a Commission decision.

• The protest also does not include convincing evidence that the Advice Letters would not meet the functionality criteria or requirements set forth in D.10-04-027.

• This Resolution approves the SoCalGas contracts with three vendors for AMI technology and installation to implement its AMI project as authorized by D.10-04-027.

Regular Agenda – Energy Resolutions and Written Reports

Item #49 [11089] Commission Review of Energy Division's Disposition Approving Southern California Gas Company's Contracts with Three Vendors

Res G-3470, Southern California Gas Company (SoCalGas) Advice Letter (AL) 4245 filed on May 27, 2011 and SoCalGas AL 4245-A filed on October 21, 2011 - Related matters.------------------------------------------------------------------------------------------

PROPOSED OUTCOME:

• Affirms Energy Division disposition letter dated December 12, 2011.

• Grants Southern California Gas Company’s (SoCal Gas) request to execute contracts with Capgemini, Aclara and Agile.

• Grants SoCal Gas’s request for confidential treatment of these contracts.

ESTIMATED COST:

• $1.0396 billion.

Regular Agenda – Communication Resolutions and Reports

Item #51 [10677] Suspends the Communications Division’s Written Disposition of TelePacific’s Advice Letter 314

Res T-17344-----------------------------------------------------------------------------------

PROPOSED OUTCOME:

• Directs parties to the proposed transaction to file an application seeking Commission approval of the processed acquisition of assets.

ESTIMATED COST:

• None.

Regular Agenda – Communication Resolutions and Reports

Item #51a [10804] ALTERNATE TO ITEM 10677

Res T-17344 Comr. Peevey-----------------------------------------------------------------------------------

PROPOSED OUTCOME:

• This alternate resolution denies the protest of Straitshot RC LLC and approves U.S. TelePacific Advice Letter 314 granting authority for the acquisition of the assets, customer base and operating authority of IXCH, Inc., by TelePacific's subsidiary, TelePacific Managed Services.

ESTIMATED COST:

• None

Commissioners’ Reports

Management Reports

Regular Agenda – Management Reports and Resolutions

Item #71 [11104] Report and Discussion by Consumer Protection and Safety Division on Recent Safety Program Activities -------------------------------------------------------------------------

32

Passenger Transportation Enforcement at Los Angeles International Airport

Adrianne JohnsonSupervising Transportation Representative

California Public Utilities Commission

March 22, 2012

Presentation Overview

• Brief History

• Los Angeles International Airport (LAX) Program

• Success Rate

History of the LAX Program

• In the late 1990’s PUC worked together with LAX officials to begin an enforcement program that would address the alarming number of unlicensed passenger carriers that conducted business at LAX.

• The program was successful. – Decrease in the number of unlicensed carriers,– After four years the program was discontinued.

Passenger Carrier Industry Requested Program Return

• Without CPUC presence the unlicensed activity increased once again. The Limousine Industry demanded that there be a CPUC presence and illegal carriers be cited and fined.

• Industry agreed to fund the program with an increase in their regulatory fee

• In 2007, the CPUC-LAX office was re-opened and staffed by 2 CPUC investigators.

Passenger Carriers Regulated

• The Commission is responsible for regulating for-hire carriers of passengers as passenger stage corporations and charter-party carriers:

• Charter vehicles of all kinds, including limousines, sedans, SUVs, vans, and buses

• Sightseeing services

• Airport shuttle services

• Scheduled bus operators

LAX Police Assist With Our Program

• For-hire vehicles must be properly permitted with LAX and CPUC to pick up passengers.

• This helps to ensure the safety of the visiting public.

It’s a Crime to Operate Without Authority

• Under Public Utilities Code § 5411 it is a misdemeanor, punishable by a fine of not less than $1,000 and not more than $5,000 or by imprisonment in a county jail for not more than three months, or both, to operate without a charter-party carrier certificate or permit or to otherwise violate the Passenger Charter-Party Carriers’ Act (§§ 5351 – 5420).

Vehicles May Be Impounded

Public Utilities Code § 5411.5 provides that whenever a peace officer arrests a person for operating as a charter-party carrier without a valid certificate or permit, the officer may impound and retain possession of the vehicle. The vehicle is returned to the owner when (1) the owner pays any fine ordered by the court, (2) the matter is not prosecuted or is dismissed, (3) the owner is found not guilty of the offense, or (4) it is determined that the vehicle was used without the knowledge and consent of the owner.

Alternative Remedy to Misdemeanor Citations

•Penal Code § 1377 provides, with certain exceptions, that when a person injured by an act constituting a misdemeanor has a remedy by a civil action, the offense may be “compromised.”

•A misdemeanor citation issued by LAX police for unlicensed carrier operations may be resolved by a “civil compromise” with the CPUC if the carrier waives its right to a court hearing and agrees to pay an administrative fine to the CPUC. Otherwise, the matter is referred to the City Attorney’s Office for possible criminal prosecution.

Civil Compromise Outcomes

•In the majority of cases, the carrier opts for a civil compromise and pays an administrative fine to the CPUC.

•With the assistance of CPUC staff at LAX, the carrier may pay its administrative fine and get its vehicle released from impound all in the same day.

•The civil compromise of a misdemeanor citation is offered to first-time offenders only.

43

Fines Collected 4-year comparison (2008 through 2011)

$106,750 $109,000$113,500

$85,000

$0

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

2008 2009 2010 2011

Year

$ a

mo

un

t c

oll

ec

ted

2011 LAX Statistics

•LAX police issued: 145 citations for unlicensed carrier violations 36 citations for General Order 157 violations (e.g., waybill and vehicle identification violations) 69 unlicensed carrier vehicles were impounded

•CPUC issued 85 administration citations $85,000 – Total administrative and court-ordered fines collected

Regular Agenda – Management Reports and Resolutions

Item #71 [11104] Report and Discussion by Consumer Protection and Safety Division on Recent Safety Program Activities -------------------------------------------------------------------------

Management Reports

The CPUC Thanks YouFor Attending Today’s Meeting

The Public Meeting is adjourned.

The next Public Meeting will be:

April 19, 2012, at 9:00 a.m.in San Francisco, CA