CPUC Public Agenda 3290 Thursday, March 8, 2012, 9:00 a.m. 505 Van Ness Ave, San Francisco

1. CPUC Public Agenda 3290Thursday, March 8, 2012, 9:00 a.m.505 Van Ness Ave, San Francisco Commissioners: Michael R. Peevey Timothy Alan Simon Michel Peter Florio Catherine J.K. Sandoval Mark J. Ferron www.cpuc.ca.gov

2. 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: 21, 28, 29, 30, 31, 32, 42 & 43 All items on the Closed Session Agenda

3. 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: 21, 28, 29, 30, 31, 32, 42 & 43 All items on the Closed Session Agenda

4. 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: 21, 28, 29, 30, 31, 32, 42 & 43 All items on the Closed Session Agenda

5. 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, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34 & 35 • 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: 39, 42, 43, 45, 48 & 49 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: 20 has been moved to the Regular Agenda. • Items: 44 & 46have been withdrawn. • The following items have been held to future Commission Meetings: • Held to 3/22/12: 4, 19, 20, 36, 36a, 37, 37a, 38, 40, 47 & 50 • Held to 4/19/12: 2 & 41

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.

7. Regular Agenda – Energy Resolutions and Written Reports Item #20 [11055] 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).

8. Resolution E-4467 (Agenda Item 20) San Diego Gas & Electric Company (SDG&E) requests approval of a renewable energy contract, as amended, with Energia Sierra Juarez U.S., LLC

9. Contract Summary • PPA is the result of SDG&E’s 2009 RPS solicitation • Project developers are Sempra Generation, an affiliate of SDG&E, and BP Wind Energy • PPA price is $106.50/MWh, and will be time-of-delivery adjusted • Approximately $820 million (nominal) in total PPA costs over the life of the contract

10. Contract Summary (cont.) • The proposed wind facility will be located in Mexico • Project will interconnect directly to CAISO via a cross-border generator-tie transmission line to the proposed East County (ECO) substation. • SDG&E filed AL 2247-E on April 19, 2011. On October 6, 2011, SDG&E filed a supplemental AL 2234-E-A, requesting approval of an amendment to the power purchase agreement that reduced the price of the power purchase agreement and accelerated the online date of the facility.

11. Location of Proposed Energia Sierra Juarez Project 11

12. Contract Summary (cont.) • Project’s expected online date is fourth quarter of 2013 • Given the online date, it is expected that the project will only contribute one quarter of its expected annual generation (85 GWh) during Compliance Period 2011-2013 • Major milestones that still need to be completed for generation to be delivered to SDG&E: • FERC approval for the affiliate transaction per 18 C.F.R. Sec 35.39, subd. (b) • Approval and construction of proposed East County (ECO) substation  • Granting of a Presidential Permit from the U.S. Department of Energy for cross-border gen-tie

13. AL 2247-E/E-A was protested • Backcountry Against Dumps recommends rejecting the PPA because the price is too high and alternatively recommends approval of the PPA be conditioned on a full environmental review of the project • The Division of Ratepayer Advocates recommends rejecting the PPA or amending the PPA to limit any excessive network upgrade costs • The Utility Reform Network, plus IBEW and State Building and Construction Trades Council of California, recommend rejecting the PPA based on price, viability, and U.S. employment impacts

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

15. Regular Agenda – Energy Resolutions and Written Reports Item #20 [11055] 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).

16. Commissioners’ Reports

17. Management Reports

18. Regular Agenda – Management Reports and Resolutions Item #51 [11100] Chief Administrative Law Judge Report on 2011 ALJ Division Achievements -------------------------------------------------------------------------

19. 2011 Accomplishments Administrative Law Judges Division

20. ALJ Division Vision Just, reasoned, efficient, and innovative resolution of matters in a manner that ensures integrity, due process and transparency, and respects the dignity of all participants.

21. ALJ Division Mission The ALJ Division provides an independent forum that ensures fair, unbiased, reasoned, and efficient disposition of proceedings and embraces new technology and work practices to continually improve our procedures.

22. Accomplishments • In 2011, the Commission opened 301 proceedings and closed 305 proceedings. • We held 317 days of hearings, over 10% more than in 2010. • The Commission issued 501 Decisions and 594 Rulings. • We received over 8,503 formally filed documents, with more than 95% of them filed electronically.

23. Accomplishments • We closed 100% of the proceedings in a timely fashion for the second year in a row

24. Accomplishments • Held 50 days of Public Participation Hearings in the following cities:

25. Accomplishments • With Judge Jean Vieth as Alternative Dispute Resolution (ADR) coordinator, we provided trained ALJs as mediators, facilitators, early neutral evaluators in 34 different disputes or workshops. • Since 2009, we have used the ADR process to help resolve 66 cases; a 74% settlement rate.

26. Accomplishments • We continue to provide internal and external information and training on our procedures and implement new tools to improve the way information for a specific proceeding can be searched on our web site.

27. Accomplishments • The New Docket Card provides various options to those looking for information and documents for a specific proceeding. • The Practitioner Page on our web site provides valuable information regarding how to file documents at the PUC and contains answers to frequently asked questions on filings requirements.

28. Accomplishments • The subscription service provides the public the ability to subscribe to documents published on the Commission's website that are associated with formal proceedings, resolutions, agenda related materials, and press releases. Over 7000 subscriptions receive email notifications for specific proceedings.

29. Accomplishments • We continue to provide training on technical issues, writing skills, Commission procedures, and hearing room practices to our ALJs. In 2011, we conducted the following trainings:

30. Accomplishments • Planning and Writing the Well-reasoned Decision • California Environment Quality Act (CEQA) Update Workshop: Issues and Trends • Taking Control of the Hearing Room, Dealing With Challenging Situations, etc

31. Individual Accomplishments • Judge Gary Weatherford • Moderated a “Who Pays?” capital investment and cost recovery panel of water managers at the bi-annual Colorado River Symposium held at Bishop’s Lodge in Santa Fe, NM • Judge Katherine MacDonald • Guest speaker at Golden Gate Law School and Whittier Law School on administrative law and the role of the administrative law judge • Course facilitator for the Fair Hearing Course at the National Judicial College • Third year running the ALJ Internship Programs • Judge W. Anthony Colbert • Joined Judge Katherine MacDonald for the past year and a half running the ALJ Internship Programs • Sr. Legal Analyst Martin M. Nakahara • Guest speaker at California American Water on the preparation of legal documents for filing & E-Filing with the Docket Office • Guest speaker at the CCPUC Annual Meeting in Monterey, CA on Docket Office matters • Recently organized a webcast presentation entitled “Filing Confidential Documents Under Seal” to be placed on the CPUC website for future reference to all interested parties

32. 2011 CPUC EMPLOYEE RECOGNITION WINNERS ALJ Division Winners received the top number of votes by their peers.  While there are three winners per award category, their accomplishments were significant given that there were a record 107 unique nominations this year! Leadership Judge Janet A. Econome, Assistant Chief Team Player Anna Toy, Office Technician

33. Regular Agenda – Management Reports and Resolutions Item #51 [11100] Chief Administrative Law Judge Report on 2011 ALJ Division Achievements -------------------------------------------------------------------------

34. Regular Agenda – Management Reports and Resolutions Item #52 [11059] Report and Discussion by Consumer Protection and Safety Division on Recent Safety Program Activities -------------------------------------------------------------------------

35. GO 165 Electric TransmissionAudit Program Ben Brinkman Senior Utilities Engineer (Specialist)Consumer Protection and Safety Division California Public Utilities Commission March 8, 2012 35

36. Presentation Overview Electrical Transmission CPUC Transmission Line Jurisdiction General Order 165 Language Electrical Transmission Inspection and Maintenance CPSD Electric Transmission Audit Program

37. Transmission Lines Deliver electricity from generators to distribution Higher voltage – typically over 50 KV (50,000 volts) up to 765 KV Overhead and Underground

38. CPUC Transmission Line Jurisdiction Transmission lines have always been subject to GO 95 and GO 128 rules on design, construction, and maintenance Transmission lines involved in 2007 Witch (San Diego) and Canyon (Malibu) Fires GO 165 Transmission Inspection Program requirements added in Fire Safety Rulemaking R0811005 (Phase 2)

39. GO 165 Language D1201032 (January 2012) added electric transmission facility inspection program rules to GO 165: Each utility shall prepare and follow procedures for conducting inspections and maintenance activities for transmission lines. Each utility shall maintain records of inspection and maintenance activities. Commission staff shall be permitted to inspect records and procedures consistent with Public Utilities Code Section 314 (a). General Order 165, Appendix IV - January 12, 2012

40. Transmission Maintenance • Utility inspection and maintenance programs include: • Patrols and Detailed inspections • Ground, climbing and aerial (helicopter) • Vegetation Management • Intrusive testing for wood poles • Utilities patrol all circuits annually • Other inspection practices vary slightly between utilities, but are similar

41. CPSD Audits • Review utility plan and ensure utility follows its plan • Two week audits – records review and field inspection • Audit frequency depends on size of utility and miles of transmission • Plan to audit each major utility at least once annually

42. CPSD Audit (cont.) • Records review • Review any CAISO and NERC audit reports • Ensure inspections up to date and conducted according to plan • Verify that utility identifies, records and repairs non-compliant equipment • Field Inspection • Patrol transmission circuits • Verify repairs and compliance with GO 95 and GO 128 • Typical issues • Damaged insulators, tower guying and grounding, clearance and sag issues, tower marking, vegetation management, right-of-way management and control, wood pole issues, loading, fencing around towers

43. Planned Upcoming Audits PG&E – May 7, 2012 SCE – Summer 2012 Sierra Pacific – Fall 2012 Pacificorp – Fall 2012 SDG&E – January 2013

44. Regular Agenda – Management Reports and Resolutions Item #52 [11059] Report and Discussion by Consumer Protection and Safety Division on Recent Safety Program Activities -------------------------------------------------------------------------

45. Management Reports

46. The CPUC Thanks YouFor Attending Today’s Meeting The Public Meeting is adjourned. The next Public Meeting will be: March 22, 2012, at 9:00 a.m. in San Francisco, CA