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Advocacy at the California Public Utilities Commission (CPUC)
CEERT’s Regulatory Counsel Sara Steck Myers and Associate Regulatory Attorney Megan Myers act as advocates and intervenors before the CPUC and other regulatory agencies to ensure fairly pricing for clean power, improve renewable energy procurement planning, and strengthen implementation of the state’s Renewable Portfolio Standard (RPS). CEERT is helping lead the fight for innovative policies that reflect the true value, costs, and benefits of clean, renewable energy.
New Events at the CPUC
New Grid for High Distributed Energy Resource (DER) Order Instituting Rulemaking (OIR) (R.21-06-017)
On July 7, the CPUC issued R.21-06-017, a new OIR to Modernize the Electric Grid for a High DER Future, and determine how to optimize the integration of millions of DERs within the distribution grid while ensuring affordable rates. The Rulemaking will prepare the grid to accommodate what is expected to be a high-DER future, and capture as much value as possible from DERs while mitigating any unintended negative impacts. It will address unresolved and ongoing issues from the Distribution Resources Plans (DRP) proceeding (Rulemaking (R.)14-08-013) and Integrated Distributed Energy Resources (IDER) proceeding (R.14-10-003).
The initial scope is: Opening Comments on the OIR are due on August 16 and a Workshop will be held in September. On July 29, ALJs Hymes and Sisto set a Prehearing Conference for August 17. The Assigned Commissioner is Commissioner Houck.
CEERT will actively participate in this proceeding.
Draft DER Action Plan 2.0
On July 23, the CPUC issued the Draft DER Action Plan 2.0, which is intended to coordinate development and implementation of related DER policy, and to align the CPUC’s vision and actions to maximize ratepayer and societal value of an anticipated high-DER future. Energy Division Staff hosted a workshop on August 6 to present the Plan for discussion and feedback.
Summary of CEERT’s Advocacy at the CPUC
CEERT has been active in the following proceedings: Extreme Weather (R.20-11-003), Transmission Planning/Reporting (I.00-11-001), Integrated Resource Planning (IRP) (R.20-05-003), Resource Adequacy (RA) (R.19-11-009), Oakland Clean Energy Initiative (OCEI) (A.20-04-013), Gas Reliability (R.20-01-007), Microgrids (R.19-09-009), Aliso Canyon (I.17-02-002), Self-Generation Incentive Program (SGIP) (R.20-05-012), and Integrated Distributed Energy Resources (IDER) (R.14-10-003).
CPUC Energy Planning and Procurement and Resource Adequacy
Extreme Weather (R.20-11-003)
On May 21, the CPUC issued D.21-05-036, an Order Denying Rehearing of D.21-02-028. Several parties, including the California Environmental Justice Alliance, Union of Concerned Scientists, and Sierra Club (Joint Parties), Protect Our Communities Foundation, and Californians for Renewable Energy filed separate Applications for Rehearing of D.21-02-028, which directs Pacific Gas and Electric (PG&E), Southern California Edison (SCE), and San Diego Gas & Electric (SDG&E) to seek contracts for additional power capacity for Summer 2021 reliability. The CPUC determined that good cause has not been demonstrated to grant rehearing of D.21-02-028.
On June 25, the CPUC issued D.21-06-027, an Order Modifying Decision 21-03-056 to Clarify Guidance in the Emergency Load Reduction Program (ELRP) Regarding a Day-Of Trigger, making clear that the adopted ELRP shall have both day-of and day-ahead triggers for Group A participants. It additionally clarifies that following an Alert, Warning, or Emergency declaration by the California Independent System Operator (CAISO), PG&E, SCE, and SDG&E will exercise discretion to activate the day-of trigger for Group A participants, either selectively staggered over time or for all participants at the same time. Attachment A to the Decision includes the Adopted Modifications to D.21-03-056 in redline.
On June 14, ALJ Stevens issued a Ruling Allowing for Refresh of Specific California Environmental Justice Alliance (CEJA) and PG&E Proposals and Subsequent All Party Reply. The Ruling asks for CEJA to resubmit testimony about its Just Flex Rewards Proposal and for PG&E to resubmit testimony about its Residential Rewards Program. Parties are directed not to address issues beyond the two Proposals.
On July 7, PG&E and CEJA submitted Supplemental Testimony. PG&E’s testimony pertains to its Residential Rewards Pilot Program (now renamed the Power Saver Rewards Pilot) and CEJA’s testimony relates to its Just Flex Rewards proposal. Parties submitted Reply Testimony on July 21, and PG&E requested to submit Rebuttal Testimony on August 6.
On August 2, ALJ Stevens issued a Ruling Seeking Responses Regarding a Proposed Amended Scope and Schedule to Address Reliability Issues in 2022 and 2023. The Ruling states that an Amended Scoping Ruling will be issued shortly on a process to ensure there is adequate supply and demand management to achieve electrical system reliability in 2022 and 2023. Parties may comment on the amended scope and schedule. The proposed amended schedule is:
- September 1: Opening Testimony
- September 10: Reply Testimony
- September 20: Opening Briefs
- September 27: Reply Briefs
- October 29: Proposed Decision
- November 18: Final Decision
CEERT plans to actively participate in this phase of the rulemaking.
Transmission Reporting (I.00-11-001)
As previously reported, since April CEERT has been actively engaged both with the Energy Division and in filings in the formal investigation on the continued need for transparent information on IOU transmission and distribution resources and additions that had been previously provided in the IOUs’ “AB 970” quarterly reports. However, in the past year, both PG&E and SCE have been granted exemptions from that reporting in reliance on FERC settlement processes, which CEERT has found do not transparently supply the level of transmission or distribution data that had been included in the AB 970 Reports.
As a result, CEERT has met with Energy Division to find pathways to improve this process. We also objected to SDG&E’s request for a reporting exemption similar to those granted to PG&E and SCE.
On June 22, the CPUC issued a Proposed Decision (PD) denying SDG&E’s requested exemption from the AB 970 Reports, finding that SDG&E’s FERC settlement process was not a sufficient replacement. While this was part of what CEERT requested, in our Opening Comments on the PD we further asked that the Commission also reconsider the exemptions that had been granted to SCE and PG&E on similar grounds. In a subsequent revision in response to CEERT’s Comments, the PD, which came before the CPUC at its August 5 Business Meeting, states that the proceeding had only been reopened to consider the narrow request made by SDG&E, and holds to the principle that CEERT would be required to challenge the exemptions granted for PG&E and SCE by separate request (petition for modification).
In the meantime, CPUC Energy Division staff has been actively posing data requests and asking PG&E and SCE to provide more clarity and information about their transmission information processes. To date, SCE has informally engaged us on their new process with mixed results, and PG&E has held a formal party workshop for stakeholders on its “Star” process and the information it provides. CEERT will continue our active engagement on this issue, especially to ensure that all information necessary to be fully informed on the status of IOU transmission and distribution projects is made public.
Integrated Resource Planning (IRP)(R.20-05-003) and Procurement-Related Activities
On May 21, ALJ Fitch issued a Proposed Decision and Commissioner Rechtschaffen issued an Alternate Proposed Decision (APD). The differences between the decisions pertain to incremental capacity from fossil-fueled resources that represent efficiency improvements, upgrades, or expansions at existing facilities. The PD stated that these resources may be used to satisfy between 1,000 MW and 1,500 MW of the total 11,500 MW requirements in this order, to be procured only by the investor-owned utilities (IOUs) by 2025. The APD stated that these fossil-fueled resources must not be located in a disadvantaged community, and will be used to satisfy 500 MW of the total 11,500 MW, to be procured only by the IOUs by 2025. The APD also authorized the IOUs to procure up to 300 MW from eligible fossil resources that commit to using specified portions of green hydrogen fuel throughout the contract term.
On June 10, CEERT submitted Opening Comments, arguing that the PD and APD do not effectively achieve the goal or original objectives set by the CPUC for the procurement to address midterm reliability for 2023-2026. We held that the APD, not the PD, should be adopted by the CPUC, but with modifications to ensure that the required midterm procurement achieves the CPUC’s goals and objectives and aligns with transmission planning processes. On June 15, CEERT submitted Reply Comments, agreeing with multiple parties that support the amount of procurement ordered in the APD, but disagreeing with SCE’s position on the APD’s procurement mandates. Numerous parties, including CEERT, opposed procurement of natural gas resources.
On June 17, V. John White spoke on behalf of CEERT at the All Party Meeting. He stated: “Thank you for having me. Thank you for doing the All Party Meeting. I think these are really helpful, open discussions and I am glad to see so many Commissioners participating.
“We support the Alternate Proposed Decision and the full 11,500 MW procurement. We also agree with other parties that we should not have any new fossil procurement and certainly not a mandated set-aside.
“We also point out the need to be cognizant and consistent between the IRP decision and the resource adequacy decision — both are pending. Both, particularly the RA decision, have implications in terms of what gets to count. We are particularly eager to see hybrid solar + storage resources, which are dispatchable, be able to help us meet that evening ramp, but they have to be able to count and we think there are reasons to adopt some interim counting rules, as we proposed in the RA decision. We also strongly support the geothermal requirement and don’t believe it should be watered down. We agree with Matt Freedman that the 85% capacity factor is a good definition. We think there are portfolio diversity benefits, reliability benefits, and significant economic development benefits from geothermal that have not been included up to now in our renewable portfolio and we think they are very important.
“We would also point out the need to continue to stay focused on transmission upgrades and expansions that are needed. The TPP that we are currently studying is insufficient. We need to specifically look at and accelerate expansion of transmission in the Central Valley, as well as North South, particularly in the absence of Diablo Canyon. We need to be sure that the resources are able to be delivered that we are proceeding to procure. On hydrogen, we agree with the caution expressed by other parties that the combustion of hydrogen should be strictly limited and subject to further study about how to minimize emissions. We also think that renewable electricity should be the principal fuel for electrolytic hydrogen. Lastly, we hope we can revisit the greenhouse gas target in light of the progress made by the other LSEs, LADWP, and SMUD. Thank you.”
Ultimately, the CPUC issued D.21-06-035, the Decision Requiring Procurement to Address Mid-Term Reliability (2023-2026). This Decision is similar to the Proposed Decision except that it states that incremental capacity from fossil-fueled resources will not be eligible to qualify under this Order, but the CEC will lead additional quantitative and qualitative analysis in the next few months to help inform the preferred system portfolio (PSP) decision expected by the end of this year, where it may consider additional capacity procurement requirements. The Decision definitively states that demand-side and distributed energy resources are eligible to count toward its capacity requirements, and emphasizes that these types of resources are the CPUC’s highest priority.
The CEC released its quantitative and qualitative modeling results at the September 8 CEC business meeting. The current scope of that analysis contemplates a potential additional ~5 GW of need in the next five years, with additional investment in new gas being considered once again. On August 10, by an ALJ email, the CPUC has acknowledged that it will formally consider those results in R.20-05-003 and “act accordingly.”
As noted above, the CPUC has opened a new docket (Order Instituting Rulemaking to Modernize the Electric Grid for a High Distributed Energy Resources Future, R.21-06-017) to deal with demand response and distributed energy issues. The CEC, at the invitation of the CPUC in the June 25 resource adequacy order (see below), is facilitating two working groups that meet weekly about providing “actionable recommendations” on demand response in resource adequacy and wholesale market participation. It is too early to tell when or even whether either of these initiatives will break the multiyear logjam of failure to achieve promised reform in current practice for customer-owned and distributed resources.
Resource Adequacy (RA) (R.19-11-009)
On May 14, CAISO submitted its Final 2022 Flexible Capacity Needs Assessment and Final Availability Assessment Hours.
On May 21, ALJ Chiv issued a Track 3B.1 and 4 Proposed Decision. On June 10, CEERT submitted Opening Comments, recommending that the PD be modified to adopt the CEERT Proposal for Counting Direct Current (DC) Coupled Hybrid Resources. In addition, CEERT joined Sunrun, Tesla, California Solar & Storage Association, Vote Solar, and Enel X North America (the Joint Parties) in submitting Joint Opening Comments. The Joint Parties argued that the PD fails to take on any of the work toward establishing a qualifying capacity (QC) value for behind-the-meter (BTM) resources that was clearly directed by D.20-06-031. On June 15, CEERT submitted Reply Comments holding that CEERT’s Proposal for QC counting of DC coupled hybrids is consistent with current adopted CPUC policy.
On June 18, V. John White, James Caldwell, and Megan Myers met on behalf of CEERT with Anand Durvasula, Legal and Policy Advisor to CPUC President Batjer. During the meeting, CEERT recommended that the CPUC adopt our Proposal for QC counting of DC coupled hybrids. The Notice of Ex Parte was submitted on June 22. The CPUC issued D.21-06-029 on June 25. Though the Decision finds there is merit to CEERT’s Proposal, it deems that it’s not implementable at this time, and the CPUC declines to adopt it, but welcomes its further development.
On June 10, ALJs Chiv and Nojan issued the Proposed Decision on Track 3B.2 Issues: Restructure of the Resource Adequacy Program. On June 30, CEERT submitted Opening Comments, noting that the PD mostly represents a prudent and reasonable roadmap for systemic RA reform. On July 6, we submitted Reply Comments stating our belief that a high-level reading of parties’ Opening Comments reveal a convergence of thought about RA in California that emphasizes both the need for fundamental reform and the thoughtfulness of the process laid out by the PD to achieve progress toward that reform. Ultimately, the CPUC issued D.21-07-014 on July 16.
PG&E held a preliminary meeting on July 30 to set up Workshops on the RA framework. Nine stakeholder-led half-day workshops are tentatively scheduled to start in September and end in January, perhaps leading to a roadmap for adoption of PG&E’s “slice of day” proposal in the 2023 RA cycle. CEERT intends to actively participate in the workshop process.
On July 1, the CAISO, PG&E, SCE, and SDG&E submitted a Compliance Filing Regarding Refreshed Effective Load Carrying Capability (ELCC) Study Results for Demand Response. On July 9, ALJ Chiv issued a Ruling Requesting Comments on the Refreshed ELCC Study Results. Opening Comments were submitted on July 19 and Reply Comments on July 26. Adoption of the results for calculating the RA value of existing IOU demand response programs would result in a significant further reduction in RA NQC of current programs, but offer at least conceptual paths to improving the performance of DR in providing reliability.
Oakland Clean Energy Initiative (OCEI) (A.20-04-013)
On May 10, PG&E submitted a Motion to Dismiss Application. PG&E made this request because the local area reliability service agreements (LARS Agreements) that are the subject of the application are now terminated, rendering the Application moot. PG&E contends that it believes it followed a reasonable path and did not file its application prematurely, and that it remains committed to working with the CAISO to develop solutions that will maintain grid reliability in the Oakland area while enabling the retirement of the Oakland Power Plant. On June 25, Executive Director Peterson issued an Order of Dismissal that closed A.20-04-013.
CPUC Gas System and Grid Initiatives
Gas Reliability and System Planning (R.20-01-007)
On June 25, ALJ Tran issued a Ruling Directing Parties to File Comments on Staff Proposal on Track 1A: Scoping Memo Issue 1c. How should the CPUC respond to a utility’s sustained failure to meet minimum design standards? Opening Comments were submitted on July 30 and Reply Comments on August 16.
On June 9, ALJ Rizzo issued a Proposed Decision Adopting a Suspension of the Capacity Reservation Component of the Standby Charge for Eligible Microgrid Distributed Technologies. On June 29, CEERT submitted Opening Comments supporting the PD’s suspension of the capacity reservation component of standby charges for eligible microgrids. On July 6, we submitted Reply Comments, agreeing with numerous parties that this suspension must avoid incentivizing microgrid technologies that are not in line with California’s clean energy goals. We recommend that the PD require microgrids to commit to switching to clean renewable fuels by December 31, rather than merely demonstrating the ability to do so.
On July 16, the CPUC issued D.21-07-011, which directs PG&E, SCE, and SDG&E to provide rate schedule(s) that suspend the capacity reservation component of their standby charge for eligible microgrids that meet the CARB air pollution standards for generation.
Aliso Canyon (I.17-02-002)
On June 28, ALJ Zhang issued a Ruling noticing a CPUC and CEC Workshop on July 9 to address the local electricity reliability impacts of reducing or eliminating Aliso Canyon. On July 9, Assigned Commissioner Guzman Aceves issued an Amended Phase 2 and Phase 3 Scoping Memo and Ruling finding that Phases 2 and 3 should be considered together.
Self-Generation Incentive Program (SGIP) (R.20-05-012)
On April 29, Commissioner Rechtschaffen issued a Proposed Decision Revising Self-Generation Incentive Program (SGIP) Renewable Generation Technology Program Requirements and Other Matters. On May 19, CEERT submitted Opening Comments supporting much of the PD. However, we remained concerned due to the proposed restrictions on the burgeoning hydrogen industry, argued that the PD should scale SGIP funding to incentivize the cleanest projects, and recommended that the CPUC remove the broad exclusion of combustion hydrogen production pathways. On May 24, CEERT submitted Reply Comments and encouraged the CPUC to ensure that actions taken through this PD do not inadvertently and preemptively inhibit the innovation and economic development of technologies that will have an important place in California’s diverse resource portfolio. We again recommended that the unnecessary restrictions on hydrogen production should be lifted to include biogas pathways. A Final Decision D.21-06-005 was issued on June 4.
Integrated Distributed Energy Resources (IDER) (R.14-10-003)
On May 25, the CPUC held a Workshop on advanced DER and demand flexibility management. Workshop information and presentations can be found here. Informal written Comments on the Workshop were submitted on June 8.
On June 28, the CPUC issued Resolution E-5150, which adopts updates to the Avoided Cost Calculator for use in demand-side DER cost-effectiveness analyses.
On June 30, ALJ Hymes issued a Proposed Decision for an Order Closing Rulemaking 14-10-003. The CPUC has largely resolved the issues it set out to accomplish by developing the Competitive Solicitation Framework for DERs, pilots of two additional frameworks for procurement of DERs, and updates on the cost-effectiveness analysis framework for DERs. While these actions have continuing related activities, as discussed below, those can be more appropriately resolved in other rulemakings. Accordingly, Rulemaking 14-10-003 will be closed. Opening Comments were submitted on July 20 and Reply Comments on July 26; this item was on the August 5 CPUC Business Meeting agenda.
Other CPUC Proceedings CEERT Continues to Track
As detailed in previous Quarterly Reports, CEERT is either a party to or on the service list for numerous CPUC proceedings that have required or could require CEERT participation, and CEERT continues to track them in anticipation of participating now or in the future.
However, because these proceedings were not the focus of CEERT’s efforts from May to August 2021, only limited information about them is provided here, but is available from CEERT’s regulatory counsel, Megan Myers (firstname.lastname@example.org) or Sara Myers at (email@example.com.) Please do not hesitate to contact them for information on any of the following proceedings as to status or next steps.
PG&E’s Regionalization (A.20-06-011)
A Virtual Status Conference was held on May 18. On June 29, Assigned Commission Batjer issued an Amended Scoping Memo and Ruling that directs PG&E to outline its updated Regionalization Plan in a more comprehensible and abbreviated format.
On July 9, PG&E submitted its Summary of the Updated Regionalization Proposal, which includes: (1) a summary of PG&E’s Updated Proposal, including its major elements, actions and benefits; (2) a summary of the relief PG&E seeks in this proceeding; (3) an estimate of PG&E’s incremental regionalization costs; and (4) PG&E’s proposal to report on its actual incurred costs associated with regionalization.
On July 20, the Joint Parties submitted a Joint Case Management Statement, which provides a status update on the stipulations and settlement of issues among the parties, the parties’ positions on each scoped issue from the Amended Scoping Memo in this proceeding, and the position of certain parties on the relief requested by PG&E’s Regionalization Proposal dated June 30, 2020, as modified by the Updated Regionalization Proposal dated February 26, 2021.
On July 23, The Utility Reform Network (TURN) submitted a Motion for Evidentiary Hearings. TURN argued that such hearings are necessary to resolve material facts. On July 28, PG&E submitted a Response objecting to the Motion, and on that same day ALJ Stevens denied TURN’s Motion.
Renewables Portfolio Standard (RPS) (R.18-07-003)
On July 22, ALJs Lakhanpal and Sisto issued a Ruling extending the deadline to September 13 for Motions to Update the Draft 2021 RPS Plan.
Demand Response (DR) (R.13-09-011/A.17-01-012, et al.)
On July 16, the CPUC issued Resolution E-5112, which approves, with modifications, SCE’s changes to its DR programs proposed in its mid-cycle review Advice Letter (AL) 4182-E. The Resolution supports SCE’s request to include the budget of the integrated energy efficiency/DR program in Category 5, and adopts a capacity bidding program (CBP) day-ahead (DA) trigger price of $75/MWh for November – April and an $80/MWh trigger price for May – October.
Energy Efficiency (EE) (R.13-11-005)
Final Decision D.21-05-031 was issued on May 26. This decision adopts a new metric, called Total System Benefit, that combines and optimizes the energy and peak demand savings goals, along with GHG benefits of EE, into one metric that can be forecasted and tracked. The decision adopts a new approach to segmenting the EE program portfolios into programs whose primary purposes are resource acquisition, market supply, or equity, and it modifies the current rolling portfolio process to now require a four-year program portfolio filing, with an eight-year business plan overlay containing strategic information, with updates every two years, to the potential and goals, as well as technical inputs and avoided costs.
On June 25, Assigned Commissioner Shiroma issued an Amended Scoping Memo on the Order to Show Cause against Southern California Gas (SoCalGas), introducing new issues. On June 28, ALJ Kao directed SoCalGas, PAO, and Sierra Club to file Opening Briefs addressing these issues on July 30, and Reply Briefs on August 27.
On June 16, the CPUC Energy Division issued Draft Resolution E-5150, which approves the Database for Energy Efficiency Resources (DEER) updates for Program Year 2023 and a revised version for Program Years 2022 and 2021.
On July 6, ALJ Fitch issued a Ruling Seeking Comment on the Inland Regional Energy Network (I-REN) Business Plan. Opening Comments were submitted on July 21 and Reply Comments on July 30.
On July 22, ALJ Kao issued a Ruling Providing Notice and Opportunity Regarding Additional Results of Draft Potential and Goals Study. Opening Comments were submitted on July 30.
Improvements to Rule 21 (R.17-07-007)
On June 4, the CPUC issued D.21-06-002, a Decision Addressing Remaining Phase 1 Issues. On July 13, Commissioner Guzman Aceves issued a Third Amended Scoping Memo, clarifying that a Proposed Decision in Phase II of this proceeding will be issued no later than 90 days after Reply Briefs are filed, which is currently estimated to be September 2022.
Power Charge Indifference Adjustment (PCIA) (R.17-06-026)
On May 20, ALJ Wang issued a Ruling requesting Comments on the Energy Division’s proposal on the timeline for issuing Market Price Benchmark calculations used in the annual ERRA Forecast proceedings to calculate the PCIA. Opening Comments were submitted on June 15 and Reply Comments on June 22.
Final Decision D.21-05-030, the Phase 2 Decision on PCIA Cap and Portfolio Optimization, was issued on May 24.
COVID-19 Debt (R.21-02-014)
On June 30, the CPUC issued D.21-06-036, a Decision Addressing Energy Utility Customer Bill Debt Via Automatic Enrollment in Long Term Payment Plans. On July 28, Notice was given of a Virtual Joint Status Conference on August 16 between the COVID-19 Debt proceeding (R21-02-014) and the 2010 Water Action Plan (R.17-06-024). On July 29, a Ruling was issued amending the scope of the proceeding; on the same date, a Ruling was issued that ordered comments on the questions set forth in the Ruling.
Additional proceedings tracked, but where there has been no activity since the last Quarterly Report:
- 14-08-013, et al.: Distribution Resource Plans
- 18-04-019: Climate Change Adaptation
- 18-07-017: Public Utility Regulatory Policies Act (PURPA)
- 19-01-011: Building Decarbonization
Associate Regulatory Attorney