Confidential Draft 2012 PG&E Wholesale Distribution Tariff (WDT) Generator Interconnection Procedures (GIP) Changes Electric Generation Interconnection William Chung – Principal MWCb@pge.com

Definitions FERC Interconnections CPUC Interconnections Applies to all voltage levels of interconnection if the generator is selling energy exported to the utility grid Except generators under CPUC jurisdiction listed in the CPUC Section below Interconnection is completed pursuant to the following: Transmission voltage (60 kV and above): CAISO Tariff Distribution voltage (below 60 kV): PG&E Wholesale Distribution Tariff (WDT) Rates for any load or standby power are governed by CPUC jurisdictional PG&E tariffs even for FERC jurisdictional interconnection projects (i.e. Standby Tariff) CPUC Interconnections Applies to interconnection if the generator is one of the following: Self Generation (all voltage levels): Onsite generation that serves on-site or over the fence load only Net-Energy Metering (NEM) Exporting generation (distribution voltage only): New Qualifying Facilities (QFs) selling all their exports to the grid to their serving utility under a PURPA PPA (i.e. Standard Offer, AB1613, SB32) New Transmission interconnected QFs will interconnect under the CAISO process Grandfathered QFs selling under PURPA PPAs may continue under Rule 21 interconnections at either Distribution or Transmission Interconnection is completed pursuant to Electric Rule 21 Rates for any load or standby power is governed by CPUC jurisdictional PG&E tariffs

WDT Update PG&E filed on December 3rd an amendment to PG&E’s Wholesale Distribution Tariff (WDT). Please see link below for the transmittal and filing. Title: Amendment to WD Tariff: Generator Interconnection Procedures File Date: 12/3/2012 Docket : ER13-494-000 Electronic Link: http://elibrary.ferc.gov/idmws/file_list.asp?accession_num=20121203-5003 Amended WDT Effective Date pending FERC approval: 12/4/2012 Amended WDT Link: http://www.pge.com/wholesale/ Amended Rule 21 Effective Date: 9/20/2012 Amended Rule 21 Link: http://www.pge.com/tariffs/tm2/pdf/ELEC_RULES_21.pdf These changes were made to conform WDT with the amended Rule 21 for Queue generators (Queue generators are exporting generators and Rule 21 non-NEM generators) following these guiding principles: Fair and Consistent Queue management PG&E’s public Queue contains both WDT and non-NEM Rule 21 interconnection requests and the amended WDT results in an identical procedure to process interconnection requests Eliminate policy driven differences between the WDT and Rule 21 except for limited cases such as: WDT Fast Track Process is at actual costs vs. Rule 21 which has some fixed fees Allow for easy transition between WDT and Rule 21 Rule 21 is limited to eligible Generating Facilities that enter into PURPA PPAs and as a result, Rule 21 Interconnection Requests should be allowed to transition to WDT if PURPA PPA not obtained Allow Rule 21 Interconnection Requests that fail Screens Q & R (a.k.a. Electrical Independence Test) to use the WDT Cluster Study Process and transition back to Rule 21 post study

WDT Changes – Part 1 The following pages outline the various changes made in PG&E’s WDT Amendment: General Changes: Improved clarity on applicability of the WDT Matched application processing fee (previously only study deposits) Eliminated 3 out of 6 security posting mechanisms Clarified when interest is paid on customer funds for studies/reviews Added language in SGIA to state the Network Upgrades shall be refunded pursuant to the CAISO tariff Conformed Queue process (did not match Queue posting requirement language) Did not add Pre-Application Report and process (The Pre-Application Report is available to all customers) Expanded the Annual Deliverability Assessment to allow Rule 21 generators to participate Allows Rule 21 generators that fail the Electrical Independence Test to utilize the WDT Cluster Study Process and opt for a Rule 21 GIA post study Allows Rule 21 generators that fail to maintain eligibility to interconnect under Rule 21 to enter the WDT procedures

WDT Changes – Part 2 Fast Track Changes: Fast Track Review Process Alignment Matched the 20BD timeline for Supplemental Review (from 10BD) Matched the process for Initial Review and Supplemental Review Results Meetings Added the non-binding cost estimate milestone and timelines Eliminated the optional facilities study Matched the IA process and timelines Independent Study Process Changes: Matched study deposit structure for projects less than 5MW $10k for SIS and $15k for FAS (previously $50k + $1k/MW up to $250k) Matched 1st posting deadline of 60CD (previously 30CD) Matched the IA process and timelines (can tender IA after Results Meetings if held) Cluster Study Process Changes: Rule 21 projects may apply for Cluster but opt out of WDT after study Study deposit structure remained the same (Currently no Cluster Study Process under Rule 21)

Remaining Differences General: Rule 21 has a Pre-Application Process. All customers can elect the Rule 21 Pre-Application Process and submit an interconnection request under Rule 21 or WDT. Rule 21 has detailed Queue Posting requirements. PG&E will post the same information for WDT projects. Fast Track: Rule 21 Fast Track is limited to 3MW. WDT has discretionary limits and exceeding these limits will likely result in Fast Track screen failures. Rule 21 Fast Track is open to all interconnection requests 3MW or less. WDT is limited to certified generators (however Rule 21 has a screen for certified generators). Rule 21 Fast Track includes detailed Supplemental Review process and screens information in the tariff language. As business practice, PG&E will apply the same process and screens for WDT projects as well (100% min load is an example).

Appendix The following slides provide more information on the various changes made to the WDT PG&E is updating the following to address these changes found at www.pge.com/wholesale: PG&E’s online application under WDT WDT process overviews WDT FAQs For questions on the WDT changes and how to submit an interconnection request, please contact WholesaleGen@pge.com. Similarly for Rule 21, please contact Rule21Gen@pge.com.

Overview of Study Paths Fast Track Process Screening process to allow for a quick path for proposed generators that do not require detailed study Up to 3MW for Rule 21 (or limit export) Up to 5MW for WDT and limited to certified generators Independent Study Process Serial study process for proposed generators that are not in a location common to other interconnection requests under study Cluster Study Process Group study process for proposed generators that are in a location common to other interconnection requests under study

Overview of Study Paths Eligibility Studies Timelines Process Costs Deliverability Option Fast Track Rule 21: less than 3MW (or limit export) WDT: Certified, Advisory limit of 2MW on 12kV and 3MW on 21kV Initial Review (IR) & Supplemental Review (SR) IR – 10 BD SR – 20 BD $800 Application Fee include IR, $2500 SR fee Rule 21: Nonrefundable fee WDT: Actual cost post study Energy Only Independent Study Process Must pass EIT Rule 21: no size limit but, given current programs, rare to exceed 20MW WDT: no size limit System Impact Study (SIS) & Facilities Study (FAS) SIS – 60 BD FAS – 60 BD For 5MW or less: SIS - $10K deposit and FAS - $15K deposit All else: $50K + $1K/MW up to $250K Rule 21: Energy Only WDT: Energy Only or Full Capacity Cluster Study Process Rule 21: Go to WDT Phase I Study & Phase II Study Phase I – 134 CD Phase II – 196 CD $50K + $1K/MW up to $250K Rule 21: Go to FERC process

Fast Track Review Process and Changes Characteristic Rule 21 WDT Changes to WDT Size Limit 3MW (or limit export) 5MW (2MW on 12kV, 3MW on 21kV, 5MW on higher voltages No change Eligibility Any technology Certified technology Studies or Reviews Initial Review (IR) & Supplemental Review (SR) Eliminated the Optional Facilities Study Initial Fee or Deposit (actual cost) $800 App Fee covers IR, $2500 SR Fee SET FEE $800 App Fee toward IR, SR Deposit (amount not specified in tariff) ACTUAL COSTS Add $800 IR deposit and change practice to collect $2500 for SR IR Timeline 15 BD No Change SR Timeline 20 BD Change from 10 BD to 20 BD IR Screens 13 Screens 10 Screens SR Screens 3 Screens plus failed screens. 100% min load screen vs. 15% peak load (proxy for 50% min load) failed screens No Change to Tariff but will change practice to evaluate 100% min load

Additional Changes to Fast Track Results Meetings Changed Options Meeting to Optional Initial Review Results Meeting Added Optional Supplemental Review Results Meeting Non-Binding Cost Estimate Added a 15 BD non-binding cost estimate process for projects that pass Initial Review or Supplemental Review but require Interconnection Facilities or minor Distribution Upgrades Contract Changed process similar to ISP except the 90CD deadline is triggered by issuance of the draft GIA Maintained SGIA (Rule 21 has a Fast Track IA but very similar to SGIA)

Independent Study Process and Changes Characteristic Rule 21 WDT Changes to WDT Size Limit None (Rare over 20MW) None No change Eligibility Any technology Pass EIT Studies or Reviews System Impact Study (SIS) & Facilities Study (FAS) Deposit (actual cost) For 5MW or less: $10K for SIS and $15K for FAS All else, $50K + $1K/MW up to $250K Added the 5MW or less difference SIS Timeline 60 BD No Change 1st Posting 60 CD after SIS Change from 30 CD to 60 CD FAS Timeline 2nd Posting 120 CD after FAS IA timeline Tender 30 CD after study or Results Meeting Execute by 90 CD after study Change to allow tendering of IA after results meeting

Cluster Study Process and Changes Characteristic Rule 21 WDT Changes to WDT Size Limit Not Applicable None No change Eligibility Any technology Studies or Reviews Phase I and Phase II Deposit (actual cost) $50K + $1K/MW up to $250K Phase I Timeline 134 CD start June 1 No Change 1st Posting 90 CD after Phase I 196 CD start Jan 15 2nd Posting 180 CD after FAS IA timeline Tender 30 CD after study or Results Meeting Execute by 90 CD after study Change to allow tendering of IA after results meeting