CPUC Public Agenda 3243 Thursday, October 29, 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: 33, 39 & 41  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, 3, 5, 10, 15, 16, 17, 18, 22, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38, 39, 40, 41, 42, 43, 44, 45, 46, 47, 48, 49 & 50. 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: 53, 54, 57 & 58 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 Items: 61, 62 & 63 have been withdrawn. The following items have been held to future Commission Meetings: Held to 11/20/09: 2, 4, 6, 7, 8, 9, 11, 12, 13, 14, 19, 21, 23, 51, 52 & 60. Held to 12/3/09: 59

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 Item #20 [8882] Gill Ranch Storage, LLC's and Pacific Gas and Electric Company's Request to Construct and Operate a Gas Storage Facility A , A Comr. Simon/ ALJ Smith PROPOSED OUTCOME: Approves Gill Ranch Storage, LLC’s (GRS’) and Pacific Gas and Electric Company’s (PG&E’s) applications for certificates of public convenience and necessity to construct and operate the Gill Ranch Gas Storage Project, a competitive natural gas storage facility; Approves PG&E’s request for a permit to construct an electric substation and a 115 kilovolt electric power line to provide electric service to the project. As a result of this Decision, GRS and PG&E will offer up to 20 billion cubic feet of competitive natural gas storage services to non-core customers. Approves the settlement agreement between the Division of Ratepayer Advocates, Lodi Gas Storage, LLC, GRS, and PG&E which resolves concerns about project ownership, preferential treatment, and cross-subsidization, and establishes reporting and disclosure requirements. Closes the Proceeding. ESTIMATED COST: The project is estimated to cost $200 to $225 million. However, the project will not serve core ratepayers, and core customers will not bear project costs. PG&E has the burden of justifying the reasonableness of any of its project costs that may be sought for recovery in gas transmission and storage rates. PG&E is fully at risk for all costs deemed unreasonable in any subsequent review of PG&E’s share of project costs.

Regular Agenda – Energy Resolutions and Written Reports Item #51 [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.

Regular Agenda – Energy Resolutions and Written Reports Item #52 [8520] Pacific Gas and Electric Company, San Diego Gas & Electric Company, and Southern California Edison Company Qualifying Facilities Contracts Res E-4242, Advice Letter (AL) PG&E AL 3197-E, SDG&E AL 1958-E and SCE AL 2200-E, filed on January 14, 2008, Supplemental Advice Letters PG&E AL 3197-E-A, SDG&E AL 1958-E-A and SCE AL 2200-E-A, filed on July 11, 2008, and Supplemental Advice Letters PG&E AL 3197-E-B – Related matters PROPOSED OUTCOME: Adopts, with modifications, the Qualifying Facility (QF) Standard Offer Contracts proposed by Pacific Gas and Electric Company (PG&E), Southern California Edison Company (SCE) and San Diego Gas & Electric Company (SDG&E). Upon adoption, there will be one QF Standard Offer Contract across all three electric Investor Owned Utilities (IOUs). The new contract may be signed by new and existing QFs with expired contracts in addition to QFs pursuing other contracting methods such as participating in an IOU’s Request for Offer process or negotiating a bilateral contract. ESTIMATED COST: Adoption of this resolution does not imply any specific cost, however, upon adoption, the utilities may enter into contracts with new or existing QFs. These contracts will form part of the utilities’ procurement costs for electricity. t is impossible to know in advance the total cost of those contracts, but in the past, QF power has represented no more than 20% of the utilities’ portfolio. Contracts executed with existing QFs should not result in any additional costs as the utilities were already purchasing power from these QFs in the past. Contracts signed with new QFs will represent new incremental expenditures, but this spending will be offset by the reduced need for new generation as a result of contracting with the new QF.

Regular Agenda – Energy Resolutions and Written Reports Item #53 [8804] Pacific Gas and Electric Company and Southern California Edison Company Departing Service Charges Res E-4226, PG&E Advice Letter (AL) 3446-E, Filed on April 2, 2009; and SCE AL 2320-E, Filed on February 9, Related matters PROPOSED OUTCOME: Clarifies that New World Generation Charges Do Not Apply to Customer Generation or Municipal Departing Load. Clarifies that Vintaged Cost Responsibility Surcharge (beginning with the 2009 vintage) will be effective for non-exempt customers departing bundled service on or after the effective date of this resolution. The Power Charge Indifference Adjustment shall vary by customer class in the same proportion as ongoing Competition Transition Charges. ESTIMATED COST: No cost impact.

Regular Agenda – Energy Resolutions and Written Reports Item #54 [8896] San Diego Gas & Electric Company Request to Establish a Memorandum Account Res E-4281, Advice Letter 2101-E Filed on August 4, Related matters. Establishment of memorandum account for correcting infractions of General Order 95 by communication infrastructure providers on joint poles owned by San Diego Gas and Electric Company PROPOSED OUTCOME: Denies San Diego Gas & Electric Company’s Request to establish a Pole Attachment Communication Maintenance Memorandum Account. ESTIMATED COST: None.

Regular Agenda – Communication Orders Item #55 [8940] Joint Application of Frontier Communications Corporation and Verizon Communications, Inc. A Comr. Peevey/ ALJ Barnett PROPOSED OUTCOME: Approves the transfer of 13 California telephone exchanges from Verizon Communications Inc. and its subsidiaries to Frontier Communications Corporation and its subsidiaries. Approves a settlement between the telephone companies and the Division of Ratepayer Advocates and The Utility Reform Network, which protects the public from rate increases and service deterioration for a period of one year. ESTIMATED COST: None.

Regular Agenda – Communication Resolutions and Reports Item #56 [8879] California Advanced Services Fund Application for Broadband Providers Res T PROPOSED OUTCOME: Adopts application requirements and guidelines for non-licensed broadband providers applying for California Advanced Services Fund grant money in conjunction with an application for American Recovery and Reinvestment Act funding to support broadband infrastructure. ESTIMATED COST: None

Regular Agenda – Communication Resolutions and Reports Item #57 [8887] Funding for the Inyo Networks Inc., Last Mile Project from the California Advanced Services Fund Res T PROPOSED OUTCOME: Conditionally adopts California Advanced Services Fund (CASF) funding for Inyo Networks, Inc., Last Mile Project in Mono, Inyo, Kern, and San Bernardino Counties. The project is contingent on Inyo receiving an American Recovery and Reinvestment Act grant for 80% of the total project cost. ESTIMATED COST: $2,247,308 from the CASF, which represents 10% of the total project cost.

Regular Agenda – Communication Resolutions and Reports Item #58 [8890] Funding for Citizens Telecommunications Company from California Advanced Services Fund Res T PROPOSED OUTCOME: Conditionally adopts California Advanced Services Fund (CASF) funding for Citizens Telecommunications Co. of California’s Alturas Middle Mile Project extending fiber for 74 miles along State Highway 299. The project is contingent on Citizens receiving an America Recovery and Reinvestment Act grant for 80% of the total project cost. ESTIMATED COST: $225,918 from the CASF which represents 10% of the total project cost.

Regular Agenda – Communication Resolutions and Reports Item #59 [8892] TracFone Wireless, Inc. Request for Eligible Telecommunication Carrier Designation Res T Advice Letter (AL) 1, filed August 20, 2008; Supplemental AL (SAL) 1A, filed December 16, 2008; SAL 1B, filed March 2, 2009; SAL 1C, filed March 16, 2009; SAL 1D, filed July 24, 2009; and SAL 1E, filed September 16, Related matters PROPOSED OUTCOME: Denies the request of TracFone Wireless, Inc. (TracFone) to be designated as an Eligible Telecommunication Carrier for the purpose of receiving federal Lifeline support. Directs the Communications Division to prepare an Order Instituting Investigation and Order to Show Cause why TracFone should not be ordered to pay all outstanding user fees and surcharges, applicable interest and penalties. ESTIMATED COST: None.

Regular Agenda – Communication Resolutions and Reports Item #60 [8893] Fundings for The California Broadband Cooperative of California's Digital 395 Middle Mile Project From the California Advanced Services Fund Res T PROPOSED OUTCOME: Construction of middle-mile broadband project in underserved area along US Highway 395 in Mono, Inyo, Kern and San Bernardino Counties under the California Advanced Services Fund (CASF) program. ESTIMATED COST: $10,149,422 from the CASF representing 10% of the total project cost.

Regular Agenda – Legal Division Matters Item #61 [8905] Comments Before Federal Communications Commission Regarding Broadband Deployment GN Docket No ; GN Docket No ; GN Docket No ; NBP Public Notice #5, DA In the Matters of International Comparison and Consumer Survey Requirements In the Broadband Data Improvement Act, GN Docket No ; A National Broadband Plan for Our Future, GC Docket No ; Inquiry Concerning the Deployment of Advanced Telecommunications Capability to All Americans in a Reasonable and Timely Fashion, and Possible Steps to Accelerate Such Deployment Pursuant to Section 706 of the Telecommunications Act of 1996, as Amended by the Broadband Data Improvement Act, GN Docket No ; NBP Public Notice #5, DA The Federal Communications Commission (FCC) seeks comment on identifying and remedying barriers to broadband deployment and adoption on Tribal lands. The FCC intends for these comments to contribute to and facilitate its development of a National Broadband Plan. Staff requests authority to submit comments to the FCC identifying projects on tribal lands the California Public Utilities Commission has funded through the Rural Telecommunications Infrastructure (AB 140) program.

Regular Agenda – Legal Division Matters Item #62 [8906] Comments Before Federal Communications Commission Regarding Broadband Technology GN Docket No ; GN Docket No ; GN Docket No ; NBP Public Notice #7, DA In the Matters of International Comparison and Consumer Survey Requirements In the Broadband Data Improvement Act, GN Docket No ; A National Broadband Plan for Our Future, GC Docket No ; Inquiry Concerning the Deployment of Advanced Telecommunications Capability to All Americans in a Reasonable and Timely Fashion, and Possible Steps to Accelerate Such Deployment Pursuant to Section 706 of the Telecommunications Act of 1996, as Amended by the Broadband Data Improvement Act, GN Docket No ; NBP Public Notice #7, DA The Federal Communications Commission seeks comment about how governments at all levels promote broadband deployment and adoption, and and how digital technologies and broadband deployment can improve civic engagement, government at all levels, and the lives and welfare of residents and businesses. Staff requests authority to submit comments identifying the ways in which California has employed broadband technology to improve the lives of its residents. Specific examples include the California Advanced Services Fund, the California Teleconnect Fund, the Deaf and Disabled Telecommunications Program, and telemedicine projects.

Regular Agenda – Communication Resolutions and Reports Item #63 [8939] Comments Before the Federal Energy Regulatory Commission Regarding Transmission Planning Processes Under Order No. 890 FERC Docket No. AD In Order No. 890, the Federal Energy Regulatory Commission (FERC) directed all transmission providers to develop a transmission planning process. In September of this year, FERC held three regional technical conferences to: Determine the progress and benefits realized by each transmission provider’s transmission planning process. Examine whether existing transmission planning processes adequately consider needs and solutions on a regional or interconnection-wide basis to ensure adequate and reliable supplies at just and reasonable rates. Explore whether existing processes are sufficient to meet emerging challenges to the transmission system, such as the integration of large amounts of location-constrained generation, and the interconnection of distributed energy resources. In the October 8, 2009 Notice establishing this Docket, FERC expressed concern, based on the comments it received at the three regional technical conferences, that there appears to be a lack of consistency across existing transmission planning processes regarding the treatment of certain types of resources. For example, FERC was concerned that planning transmission facilities necessary to meet state renewable resource requirements must be integrated with existing transmission planning processes that are based on metrics or tariff provisions focused on reliability or in some cases production cost savings. The California Public Utilities Commission previously provided comments to FERC on various issues relating to transmission planning processes, especially in connection with the FERC Docket that led to the adoption of Order No However, the concerns raised in FERC’s October 9 Notice go beyond the scope of what was addressed in Order No. 890, and appear to raise some issues that staff would like to comment on, which have not been the subject of previous Commission authorizations. Accordingly, staff seeks Commission authority to address such issues.

Commissioners’ Reports

Management Reports

The CPUC Thanks You For Attending Today’s Meeting The Public Meeting is adjourned. The next Public Meeting will be: November 20, 2009, at 10 a.m.