CPUC Public Agenda 3240 Thursday, September 10, 2009, 10 a.m. 505 Van Ness Ave, San Francisco Commissioners: Michael R. Peevey Dian M. Grueneich John A. Bohn Rachelle Chong Timothy Alan Simon

Public Comment Any member of the public who wishes to address the CPUC about matters before the Commission, must first sign up with the Public Advisor before the meeting begins. Once called, at the discretion of the President of the CPUC, each speaker has up to 2 minutes. A sign will be posted when 1 minute remains. A bell will ring when time has expired. The following items are NOT subject to Public Comment:  Items: 7, 11, 27  All 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, 4, 5, 9, 10, 11, 12, 16, 17, 18, 19, 21, 22, 23, 24, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38, 39, 40 & 41. 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: 48 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. Items: None have been moved to the Regular Agenda. Item: None have been withdrawn. The following items have been held to future Commission Meetings: Held to 9/24/09: 2, 3, 6, 7, 8, 13, 14, 15, 20, 25, 42, 42a, 45, 46, 47, 49 & 51.

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

Regular Agenda – Energy Orders PROPOSED OUTCOME: Awards Sustainable Conservation $21, in compensation for its substantial contributions to Decision Closes the proceeding. ESTIMATED COST: Payment will be made by Pacific Gas and Electric Company, San Diego Gas & Electric Company, and Southern California Edison Company based on their proportional gas and electric revenues for Item #42 [8616] Compensation to Sustainable Conservation for Substantial Contributions to Decision R Order Instituting Rulemaking to Continue Implementation and Administration of California Renewables Portfolio Standard Program. Ratesetting Comr. Peevey/ ALJ Division ____________________________________________________________________________________________________________________________________________________

Regular Agenda – Energy Orders PROPOSED OUTCOME: Unlike the Proposed Decision, the Alternate denies Sustainable Conservation intervenor compensation for its substantial contributions to Decision because its request for intervenor compensation does not comply with the Public Utilities Code Sections 1802(b)(1) and 1804(b)(1). Closes the proceeding. ESTIMATED COST: None Item #42a [8732] ALTERNATE TO ITEM 8616 Ratesetting Comr. Bohn

Regular Agenda – Energy Orders PROPOSED OUTCOME: Establishes Commission processes and adopts criteria for review of Smart Grid projects and investments by investor-owned utilities seeking Recovery Act funding from the US Department of Energy. ESTIMATED COST: No costs to government or ratepayers result from this decision. Item #43 [8713] Establishes Commission's Processes and Criteria for Review of Smart Grid Projects and Investments by Investor-Owned Utilities Seeking Recovery Act Funding from the US Department of Energy R Order Instituting Rulemaking to Consider Smart Grid Technologies Pursuant to Federal Legislation and on the Commission’s own Motion to Actively Guide Policy in California’s Development of a Smart Grid System. Quasi-Legislative Comr. Chong/ ALJ Sullivan _____________________________________________________________________________________________________________________________________________________

Regular Agenda – Energy Orders PROPOSED OUTCOME: Denies SDG&E's Application, without prejudice. Directs the parties to use a collaborative process to consider issues that will be identified in a subsequent assigned Commissioner’s ruling. Keeps the proceeding open, and directs the parties to file a status update by December 10, 2009 on the progress made in the collaborative process. Denies, without prejudice, San Diego Gas & Electric Company’s proposed revisions to Electric Tariff Rule 14. Requires SDG&E to submit an Advice Letter by November 1, 2009 containing a schedule for the upgrading of the lines and the re-closer policy in the high-fire area that is the subject of the instant Application. ESTIMATED COST: None. Item #44 [8757] San Diego Gas & Electric Company’s Power Shut-Off Plan A Application of San Diego Gas & Electric Company (SDG&E) for Review of its Proactive De-Energization Measures and Approval of Proposed Tariff Revisions Ratesetting Comr. Simon __________________________________________________________________________

Regular Agenda – Energy Orders Item #44a [8758] ALTERNATE TO ITEM 8757 Ratesetting Comr. Simon/ ALJ Kenney PROPOSED OUTCOME: Deny, without prejudice, San Diego Gas & Electric Company’s proposal to shut off power to certain areas and communities during periods of high fire danger; Deny, without prejudice, San Diego Gas & Electric Company’s proposed revisions to Electric Tariff Rule 14; and Closes the proceeding. ESTIMATED COST: None.

Regular Agenda – Energy Orders PROPOSED OUTCOME: Grants Southern California Gas Company authority to issue up to $570 million of its requested $800 million of long-term Debt Securities. Debt Securities include: (a) secured debt, (b) unsecured debt, (c) debt placed in foreign capital markets, (d) medium-term notes, (e) direct long-term loans, (f) accounts receivable financing, (g) variable- rate debt, (h) “fall-away” mortgage bonds initially secured and subsequently convertible into unsecured debt, and (i) subordinated debt. Denies the remaining $230 million of its request because Southern California Gas Company already has access to $230 million of unused long-term debt authority to help satisfy its 2009 through 2011 long-term debt needs. Allows Southern California Gas Company to encumber utility property, including its accounts receivable, to secure Debt Securities and use hedges to manage interest rate risk. Authorizes Southern California Gas Company to enter into: (a) put options, (b) call options, (c) sinking funds, (d) interest rate swaps, (e) swaptions to enter or exit swap agreements under specified terms and conditions, (f) caps and collars, (g) currency swaps, (h) credit enhancements, (i) capital replacement, (j) interest deferral, (k) special- purpose entity transactions, and (l) delayed draw downs. Exempts certain Debt Securities from the Commission’s Competitive Bidding Rule as enumerated in the decision and authorizes Southern California Gas Company to report all required General Order 24-B Debt Securities information to the Commission on a quarterly basis unless directed to report on a monthly basis by the Commission staff. Closes the proceeding. ESTIMATED COST: None Item #45 [8777] Southern California Gas Company Request to Issue New Long-Term Debt A Application of Southern California Gas Company for Authorization to: (1) Obtain Long-term Debt Capital Not to Exceed the Equivalent of U.S. $800,000,000; (2) Include Certain Features in Debt Securities or Enter into Certain Derivative Transactions; (3) Hedge Issuances of Debt Securities and Preferred or Preference Securities; (4) Obtain Exemptions from the Competitive Bidding Rule; and (5) Take All Other Necessary, Related Actions. Ratesetting Comr. Simon/ ALJ Galvin

Regular Agenda – Energy Resolutions and Written Reports Item #46 [8518] Moorpark-Newbury 66 kV Subtransmission Line Res E-4243, Advice Letter 2272-E, filed on October 2, Related matters PROPOSED OUTCOME: Affirms a prior Executive Director’s Action Resolution E-4225 findings related to Southern California Edison’s (SCE’s) proposed Moorpark-Newbury 66 kV Subtransmission line. Finds that: SCE complied with the notice requirements for the proposed construction of facilities; The proposed facilities were exempt from Permit to Construct requirements; Facts claimed in protests to Executive Director’s Action Resolution did not support a finding that General Order 131-D exemption criteria applied. Dismisses protests. ESTIMATED COST: Moorpark-Newbury 66kV Subtransmission Line was filed as Advice Letter 2272-E Notice of Proposed Construction Project Pursuant to General Order 131-D, therefore no cost information is provided or required for Permits to Construct.

Resolution E-4242 (Agenda Item 47) California Public Utilities Commission September 10, 2009

Resolution E-4242 Pacific Gas and Electric Company (PG&E), Southern California Edison Company (SCE) and San Diego Gas and Electric Company (SDG&E) request approval of a standard offer contract for Qualifying Facilities (QFs).

Background D directed Energy Division to develop a new QF Standard Offer Contract reflecting updated terms and conditions. The QFs, IOUs and Energy Division negotiated for over a year to develop this new contract. All outstanding issues from negotiations are addressed and resolved in this resolution.

Highlights of Resolution E-4242 A robust contract with enhanced terms and conditions reflecting modern procurement practices. New contracts for existing and firm generation –5 years for as-available –10 years for firm –10 years for hybrid of firm and as-available Enhanced performance standards- 95% performance standard for peak hours

Highlights of E-4242 (Continued) GHG cost recovery through MRTU market prices Robust credit and collateral provisions Updated scheduling provisions allowing for more accurate and timely scheduling of QF power Compliance with the CAISO Tariff and applicable CAISO interconnection agreements

Regular Agenda – Energy Resolutions and Written Reports Item #48 [8718] San Diego Gas & Electric Company Increased Funding for its Charitable Neighbor-to-Neighbor Customer Assistance Program. Southern California Gas Company Increased Funding for its Charitable Gas Assistance Fund Customer Assistance Program Res E-4251, SDG&E Advice Letter (AL) 2065-E/1842-G and SoCalGas AL 3963-G filed on February 20, 2009 respectively - Related matters PROPOSED OUTCOME: Approves San Diego Gas & Electric Company's (SDG&E) request to transfer $1 million from its over-collected Rate Design Settlement Account and $0.3 million from its over-collected Post Gas Energy Efficiency Balancing Account to augment Neighbor-to-Neighbor Program. Approves Southern California Gas Company's (SoCalGas) request to transfer $3 million from its over-collected Self Generation Program Memorandum Account to augment its Gas Assistance Fund program. ESTIMATED COST: None.

Regular Agenda – Energy Resolutions and Written Reports Item #49 [8754] Energy Efficiency Interim Verification Report Res E PROPOSED OUTCOME: Adopts the interim Verification Report prepared by the Energy Division to verify the costs and installations of the Investor Owned Utilities’ energy efficiency program activities during the program period. ESTIMATED COST: None.

RESOLUTION G-3435 (Agenda Item 50) Southern California Gas Company Advice Letter 3976 Julie A. Fitch Director, Energy Division California Public Utilities Commission September 10, 2009

Background, RFO Process, Advice Letter 3976 and Protests D approved transfer of responsibility for managing minimum flow requirements for southern system reliability from SoCalGas’ Gas Acquisition to the Utility System Operator (SO). The SO posted an RFO for supply and capacity, and negotiated terms and contracts. The SO filed Advice Letter 3976 requesting approval of 5 contracts to support its minimum flow requirements on the southern system. The contracts were categorized into supply and capacity. DRA, SCGC, and Shell filed protests to the AL.

Resolution G-3435 both approves and denies gas supply contracts, denies a capacity contract, and requires the SO to pay the FAR charge Approves contracts between the SO and 3 parties for gas supply. Denies the contract with Gas Acquisition because total deliveries provided by all contracts were excessive and no proposal was made as to how revenues would be handled under the GCIM. Denies the contract with El Paso Natural Gas because the issue of granting authority for off-system delivery is the subject of another proceeding. Requires the SO to pay a firm access rights charge just as other users of the SoCal Gas system do. Allows the issue of payment of the FAR charge by the SO to be addressed again during the 18 month FAR review.

Regular Agenda – Commissioner’s Reports Item #51 [8748] Appointments to the Low Income Oversight Board Commissioner Grueneich Report Discussion and action regarding the appointment to the Commission’s Low Income Oversight Board (LIOB) of Ortensia Lopez and Louise Perez as public representatives and Allan Rago as the private contractor representative. The 11-member LIOB advises the Commission on low-income electric, gas, and water customer issues and serves as a liaison for the Commission to low-income ratepayers and representatives.

Commissioners’ Reports

Management Reports

“It’s for you.” California LifeLine Awareness Week

NARUC Resolution July 22, 2009 – NARUC Board of Directors adopted a resolution proclaiming National Telephone Discount LifeLine Awareness Week Goal – initiate and promote outreach events across the nation Timeframe – September 14 to 20, 2009

CPUC Collaborative Effort Business & Community Outreach Office Commissioners News & Public Information Office Public Advisor’s Office Communications Division

Outreach Focus on existing events to lower costs Leverage relationships with CBOs like Self Help for the Elderly and TURN to co-host events September 14 – 20, confirmed events and presentations 5 tentative events Remainder of September confirmed events and presentations 3 tentative events

Outreach Events including legislative members: Sept CPUC/TURN event in Oakland Will be attended by Senator Mark Leno and Assembly Member Tom Ammiano. Commissioner Grueneich’s office will be speaking. Sept. 17 – CPUC/Self Help for the Elderly Bill Fair in SF Chinatown – Assemblywoman Fiona Ma has been invited. Commissioner Chong will be speaking. Sept. 19 – 3 rd Annual Family Resource Fair in Arleta is co-sponsored by, and will be attended by, Senator Alex Padilla and Assembly Member Felipe Fuentes.

News and Public Information Save the Date/Media Advisory Issued September 2, 2009 –Media Advisory will be re-issued as events are added –Calls will be made to radio, TV, print in event territories –Media Advisory sent to press, Legislative offices, local governments, CBOs, etc. Posters created for display at CPUC and at events New Consumer Programs brochure created to hand out at events Created web pagewww.cpuc.ca.gov/LifeLineWeek –Link to from CPUC homepage, LifeLine pages, CalPhoneInfo, and Consumer Information Center Promote events on Twitter, MySpace, and FaceBook. Promoted LifeLine Week in eNewsletter. Monitoring and participating in national media plans via NARUC

The CPUC Thanks You For Attending Today’s Meeting The Public Meeting is adjourned. The next Public Meeting will be: September 24, 2009, at 10 a.m.