Rule 21 Working Group 3 CONFERENCE CALL JANUARY 3, 2018 https://www.uberconference.com/gridworks https://gridworks.org/initiatives/rule-21-working-group-2/ https://gridworks.org/initiatives/rule-21-working-group-3/

https://gridworks.org/initiatives/rule-21-working-group-3/ Agenda 1. Review WG meeting and call schedule 2. Regulatory updates 3. Issue D discussion and next steps 4. Issue 12 discussion and next steps 5. Issue 15 discussion and next steps 6. Issues for Jan 10 in-person meeting 7. Updates on issue proponents https://gridworks.org/initiatives/rule-21-working-group-3/

Schedule – Working Group Date Meeting Issue Discuss Issue Finalize Location Jan 3 Call   Jan 10 In person 16 & 23 15 Oakland Centre (1000 Broadway) Jan 16 Jan 23 A & B 16 Feb 6 Feb 13 20 & 22 12 & 23 CPUC – Golden Gate Room Feb 27 Mar 6 24 Mar 20 Mar 27 CPUC – Courtyard Room Apr 10 Apr 17 24 & 27 & 28 May 1 May 8 Final report  May 22 May 29 Final report Jun 12 Jun 24 Report due https://gridworks.org/initiatives/rule-21-working-group-3/

Schedule – SIWG Issue 27/28 Calls For Issues 27 and 28, there is a separate set of phone discussions with all SIWG members invited, which will lead to discussion during the in-person meeting on April 17: Jan 11 2:30-4pm PST Jan 31 1-2:30pm PST Feb 21 1-2:30pm PST Mar 14 1-2:30pm PST Apr 4 1-2:30pm PST The first call already took place December 19; notes and issue framing from that call forthcoming by January 4. https://gridworks.org/initiatives/rule-21-working-group-3/

https://gridworks.org/initiatives/rule-21-working-group-3/ Regulatory Updates https://gridworks.org/initiatives/rule-21-working-group-3/

https://gridworks.org/initiatives/rule-21-working-group-3/ Issue D (Part of Issue 12) When should the Commission consider results of an initial review or detailed study to be binding? Under what circumstances should the Commission allow the results to be changed? https://gridworks.org/initiatives/rule-21-working-group-3/

Issue D Consultation Comments Question What is an appropriate cut-off time for getting billed actual costs? Party Comments Customers finance with leases and if additional costs are billed later they can’t finance them, their financing window is closed, even 6 months later. Final reconciliation should be by PTO ideally. We have recently been getting bills from SCE for projects done 3 years ago, in the tens of thousands of dollars. Our customers can’t pay. This length of delay is ridiculous. SDG&E reconciles actual costs at the end, and bills difference from originally estimated costs within 90-120 days of PTO. PG&E bills initially estimated costs, doesn’t adjust later. PG&E has never asked for an additional dollar post-PTO. This should be mirrored with SCE. Some East-Coast utilities mandate 30 days after PTO. https://gridworks.org/initiatives/rule-21-working-group-3/

https://gridworks.org/initiatives/rule-21-working-group-3/ Issue D – Discussion https://gridworks.org/initiatives/rule-21-working-group-3/

https://gridworks.org/initiatives/rule-21-working-group-3/ Issue D – Next Steps https://gridworks.org/initiatives/rule-21-working-group-3/

https://gridworks.org/initiatives/rule-21-working-group-3/ Issue 12 How can the Commission improve certainty around timelines for distribution upgrade planning, cost estimation, and construction? Should the Commission consider adopting enforcement measures with respect to these timelines? If so, what should those measures be? https://gridworks.org/initiatives/rule-21-working-group-3/

Issue 12 Discussion (from Dec 12) Transparency should be our focus, which can lead to accountability. IOU stakeholders generally support a more transparent and data driven approach to design and construction timelines. These types of process improvements often require significant capital investments and a detailed business case. Perhaps we only need to focus on a small subset of key timelines and reporting; there are a hundred different timelines in Rule 21. WG members requested a current list of the types of project delays that trigger notifications from each of the IOUs. What are some reporting data points we can all agree on, which demonstrate the interconnection process is working? Maybe separate into a “design bucket” and a “construction bucket.”  What aspects of current practices should require notification? Average results (in reporting) are not so helpful, rather, reporting should identify where there are specific problems or bottlenecks, with types of projects, or with organizational divisions, etc. https://gridworks.org/initiatives/rule-21-working-group-3/

Issue 12 Discussion (from Dec 12) PG&E, SCE and SDG&E address NGOM timelines, complaints and notices uniquely. The more complex a NGOM project is the more likely it will face design and construction delays. WG members would like to better understand the frequency and types of projects that cause delays. Participants discussed the ombudsman process, as well as the Interconnection Discussion Forum.  Our focus should be on best practices in communicating and managing delays, rather than on dispute resolution mechanisms. The WG discussed the independent consultant hired to review and recommend changes to the current data reporting structure. The independent consultants report is expected in Q4 2019 (beyond WG3 timeline). Substation upgrades not part of scope, only distribution upgrades. https://gridworks.org/initiatives/rule-21-working-group-3/

Summary of Recommendations NGOM timeline Performance data considered in GRC Data reporting Stronger requirements for notices

What for California? Two Step approach Step One: Settings goals for incremental improvement over 3 years, and careful and detailed reporting on adherence to all timelines. Establish to process to set goals Example: End goal of achieving within +/- 5% of end-to-end timelines for aggregate Need to consider what serious tracking of compliance looks like. This is the key to enforcement. Step Two: After three years, assessment of progress to goals and identifying next steps Review and vet existing timelines Consider Commission action Consider enforcement mechanisms Possible differences in how to treat construction timelines vs. other process timelines Best to address issues before it gets to the point about talking about penalties. So, if you can get good reporting and work toward goals, may never need to talk about enforcement mechanisms. How to do this? End-to-end aggregate goals? Goals for individual timelines? What do folks in the room think? This is basically a 3 year grace period to achieve compliance, and show progress to this goal.

Issue 12 Action Items (from Dec 12) CALSSA to draft a detail Issue 12 proposal addressing timelines, transparency, enforcement and notification prior to the next in-person meeting (1/10). Suggestions for defining data points used in reporting (no specific parties). WG members to conduct offline discussion identifying NGOM utility best practices. NGOMs and notification — what do contractors want to see and when, have them make suggestions (no specific parties). Discuss relevance and applicability to California of MA and NY experience with performance-based incentives Other items still to be addressed? https://gridworks.org/initiatives/rule-21-working-group-3/

https://gridworks.org/initiatives/rule-21-working-group-3/ Issue 15 Should the Commission require itemized billing for distribution upgrades to enable customer comparison between estimated and billed costs and verification of the accuracy of billed costs? https://gridworks.org/initiatives/rule-21-working-group-3/

Issue 15 Discussion (from Dec 12) PG&E, SCE and SDG&E address cost itemization uniquely. The WG discussed itemizing costs between labor and materials for SFA projects. Parties want itemization of actual costs to follow the Unit Cost Guide, but utilities explained some difficulties in backing out that type of actual costs data from their costing systems. PG&E, SCE and SDG&E address cost itemization uniquely, so greater format standardization would also be desirable. https://gridworks.org/initiatives/rule-21-working-group-3/

Issue 15 Action Item (from Dec 12) The IOUs (led by PG&E) will determine if and when a proposal to itemize SFA/IFFOA costs between labor and materials is possible and will provide an update to the WG on 1/3 conference call. https://gridworks.org/initiatives/rule-21-working-group-3/

https://gridworks.org/initiatives/rule-21-working-group-3/ Issue 15 -- Discussion https://gridworks.org/initiatives/rule-21-working-group-3/

https://gridworks.org/initiatives/rule-21-working-group-3/ Issue 15 – Next Steps https://gridworks.org/initiatives/rule-21-working-group-3/

Next Issues for Jan 10 Meeting Issue 16 (GPI with Clean Coalition supporting) Issue brief/presentation to be circulated no later than January 3 Issue 23 (CESA, Honda, Nuvve, and CEC) Issue briefs/presentations (3) to be circulated no later than January 3

Issue Proponents CALSSA with IREC supporting CALSSA CESA and GPI 12 How can the Commission improve certainty around timelines for distribution upgrade planning, cost estimation, and construction? Should the Commission consider adopting enforcement measures with respect to these timelines? If so, what should those measures be? CALSSA with IREC supporting Addition: When should the Commission consider results of an initial review or detailed study to be binding? Under what circumstances should the Commission allow the results to be changed? 15 Should the Commission require itemized billing for distribution upgrades to enable customer comparison between estimated and billed costs and verification of the accuracy of billed costs? CALSSA 16 Should the Commission encourage third party construction of upgrades to support more timely and cost-effective interconnection, and if so, how? GPI with Clean Coalition supporting 20 How should the Commission coordinate Commission-jurisdictional and Federal Energy Regulatory Commission-jurisdictional interconnection rules for behind-the-meter distributed energy resources, including modification of queuing rules for Rule 21 and Wholesale Distribution Access Tariff (WDAT) projects seeking to interconnect at the same location, clarification of the rules for projects wanting to transfer between the Rule 21 and WDAT queues, and streamlining of the transfer process? CESA and GPI https://gridworks.org/initiatives/rule-21-working-group-3/

Issue Proponents Issue # Issue Issue Proponents? 22 Should the Commission require the Utilities to make improvements to their interconnection application portals? If yes, what should those improvements be? GPI 23 Should the Commission consider issues related to the interconnection of electric vehicles and related charging infrastructure and devices and, if so, how? CESA, Honda, Nuvve, and CEC 24 Should the Commission modify the formula for calculating the Cost-of- Ownership charge and, if so, how? Clean Coalition with support from CALSSA 27 What should be the operational requirements of smart inverters? What rules and procedures should the Commission adopt for adjusting smart inverter functions via communication controls? SIWG 28 How should the Commission coordinate with the Integrated Distributed Energy Resource proceeding to ensure operational requirements are aligned with any relevant valuation mechanisms? Issue A What changes are needed to clarify the parameters for approval of system design to achieve non-export and limited export? CALSSA with support from IREC Issue B How should utilities treat generating capacity for behind the meter paired solar and storage systems that are not certified non-export? https://gridworks.org/initiatives/rule-21-working-group-3/

Role of Issue Proponents Preparing an issue brief and/or presentation for circulation at least one week prior to in-person meeting. framing, key questions, considerations, background knowledge, initial proposals, and identification of points for resolution. leading an “offline” approach, and/or ad-hoc phone discussions during the interval between initial discussion and issue finalization

https://gridworks.org/initiatives/rule-21-working-group-3/ Wrap Up January calls and meetings: Jan 10 – In person meeting (Oakland Centre) Jan 11 - Issue 27/28 SIWG call Jan 16 - WG call Jan 23 – In person meeting (Oakland Centre) Jan 31 - Issue 27/28 SIWG call https://gridworks.org/initiatives/rule-21-working-group-3/