CPUC Public Agenda 3293 Thursday, May 10, 2012, 9:00 a.m Fresno Street, Room 2097, Fresno Commissioners: Michael R. Peevey Timothy Alan Simon Michel Peter Florio Catherine J.K. Sandoval Mark J. Ferron

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: 7, 15, 21, 25 & 34  All items on the Closed Session Agenda

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: 7, 15, 21, 25 & 34  All items on the Closed Session Agenda

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: 7, 15, 21, 25 & 34  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, 2, 4, 5, 6, 8, 9, 12, 13, 16, 17, 18, 20, 21, 22, 23, 24, 25, 27 & 28 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: 34, 35, 39, 43, 46, 47 & 53 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: 3 has been moved to the Regular Agenda. Items: 36, 40, 41 & 42 have been withdrawn. The following items have been held to future Commission Meetings: Held to 5/24/12: 3, 10, 14, 15, 19, 26, 29, 29a, 31, 32, 33, 33a, 37, 38, 44, 45, 48, 49, 50, 51 & 52 Held to 6/7/12: 7 & 11

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 #29 [11047] Pacific Gas and Electric Company to Invest $9.9 Million of Ratepayer Funds in a Solar Manufacturing Development Facility A Application of Pacific Gas and Electric Company for Authority to Increase Electric Rates and Charges to Recover Costs Relating to California Solar Photovoltaic Manufacturing Development Facility. Ratesetting Comr. Peevey/ Judge Bemesderfer PROPOSED OUTCOME: Denies the application of Pacific Gas and Electric Company to invest $9.9 million of ratepayer funds in Silicon Valley Technology Corporation. Closes the proceeding. ESTIMATED COST: None.

Regular Agenda – Energy Orders Item #29a [11048] ALTERNATE TO ITEM Ratesetting Comr. Peevey PROPOSED OUTCOME: Approves the application. Finds that the Manufacturing Developing Facility (MDF) is similar to research and development programs that the California Public Utilities Commission (Commission) has financed through ratepayer surcharges in the past. The Alternate Proposed Decision (APD) notes that construction of the MDF is consistent with the Commission’s program of encouraging utilities to increase their use of renewable resources; is supported by substantial grant funding from the United States Department of Energy; and that, as a research and development project, it is not expected to earn a return. The APD finds that the likelihood of reducing the cost of solar photovoltaic technology is a sufficient justification for the investment of ratepayer funds. Closes the proceeding. ESTIMATED COST: Ratepayers costs of $17.8 million.

Regular Agenda – Energy Orders Item #30 [11187] Guidance for Investor-Owned Utilities’ on Energy Efficiency Portfolios and 2012 Marketing, Education, and Outreach R Order Instituting Rulemaking to Examine the Commission's Post-2008 Energy Efficiency Policies, Programs, Evaluation, Measurement, and Verification, and Related Issues. Ratesetting Comr. Ferron/ Judge Farrar PROPOSED OUTCOME: Gives guidance to the investor owned utilities on their energy efficiency program applications. Requires the filing of separate applications for statewide marketing, education and outreach activities for demand side resources. ESTIMATED COST: None.

Regular Agenda – Energy Orders Item #31 [11189] Amendments to Public Utilities Code Section Enacted by Senate Bill 380, Senate Bill 32, and Senate Bill 2 1X and Petitions for Modification of Decision R Order Instituting Rulemaking to Continue Implementation and Administration of California Renewables Portfolio Standard Program. Ratesetting Comr. Ferron/ Judge DeAngelis PROPOSED OUTCOME: Implements the amendments to Public Utilities Code § enacted by Senate Bill (SB) 380 (Kehoe, Stats. 2008, ch. 544, § 1), SB 32 (Negrete McLeod, Stats. 2009, ch. 328, § 3.5), and the more recent amendments enacted by SB 2 of the First Extraordinary Session (Simitian, Stats. 2011, ch. 1) (SB 2 1X). Adopts, among other things: A new pricing mechanism for the Commission’s § Feed-in Tariff (FiT) Program, referred to as the “Renewable Market Adjusting Tariff” or “Re- MAT.” Re MAT includes two principle components. First, a starting price based on the weighted average contract price of Pacific Gas and Electric Company, Southern California Electric Company, and San Diego Gas & Electric Company’s highest priced executed contract resulting from the Commission’s Renewable Auction Mechanism auction held in November This starting price will apply to three FiT product types: baseload, peaking as-available, and non-peaking as-available. Second, a monthly price adjustment mechanism that increases or decreases the starting price in each product type based on the market response. Finally, each accepted project will be paid a time-of-delivery adjustment based on the generator’s actual energy delivery profile and the individual utility’s time-of-delivery factors. Several new or revised FiT Program components, including, among other things, increasing the maximum size of eligible facilities to 3 megawatts, adjusting capacity allocations among the utilities, adopting project viability criteria, and excluding small electric utilities from the program. Denies two petitions for modification of Decision , the decision initially establishing the tariffs and standard contracts for utilities under § , filed by Sustainable Conservation and by Solutions for Utilities, Inc. ESTIMATED COST: Unknown.

11 Feed-in Tariff Proposed Decision Mark Ferron California Public Utilities Commission May 10, 2012

FiT PD and Proposed Changes Program Size: Clarification –Keep 750 MW cap and utility/muni allocation –Clarify that CPUC may want to consider program capacity increase for IOUs in future based on need and cost Number of product types: No change –3 product types (baseload, on-peak as-available, off-peak as-available) Capacity allocation: Considering changes –One-third overall program capacity allocated to each product type –Considering whether to “front load” MWs earlier in the program to better respond to market conditions [more analysis needed] Rules that apply to projects in current FiT queue: Clarification –New rules will apply to projects that are in queue but have not yet executed a FiT contract

FiT PD and Proposed Changes Overall pricing approach: No change –Renewable Market Adjusting Tariff (Re-MAT) Starting price: No change –$89.23, which is based on the weighted average contract price of IOUs’ highest priced executed RAM contract Price adjustment mechanism: Changes considered –Frequency: Change considered Increase from monthly to every 2 months Implication: program capacity is allocated over 2 years –Magnitude of +/- price adjustments: No change 1 st adjustment = starting price +/- $4/MWh; 2 nd adjustment = starting price +/- $12/MWh;…

FiT PD and Proposed Changes Price adjustment mechanism: Changes considered –Adjustment trigger: No change 5 projects must be in queue for price +/- in following period Note: we could increase # of projects to reduce sensitivity to price increases –Roll over of MWs if full capacity is not subscribed in a period: We have a few options to consider… Full amount of unsubscribed MWs roll over to next period Unsubscribed MWs are evenly distributed over remaining periods Unsubscribed MWs are allocated to a new 2-month period at the end of the program

FiT PD and Proposed Changes Cost containment: Changes considered –Eliminate reassignment rule that would move capacity out of an under-subscribed product type –Do not adopt fixed price cap –Authorize IOUs to file a motion to suspend (a portion of) program if they suspect market manipulation or if prices become unreasonable

FiT PD and Proposed Changes Environmental compliance cost adder: Changes considered –If possible to implement, adopt a adder specifically for “air pollution offsets associated with the operation of new generating facilities in the local air pollution control or air quality management district where the electric generation facility is located” (PU Code (d)(1)) [more analysis needed to determine if/how we can operationalize this] Strategically located: Changes considered –A project passing interconnection fast track is considered strategically located –For other projects, set a minimal threshold cost of transmission upgrades that could be triggered (and paid by ratepayers) and still be considered strategically located

Regular Agenda – Energy Orders Item #31 [11189] Amendments to Public Utilities Code Section Enacted by Senate Bill 380, Senate Bill 32, and Senate Bill 2 1X and Petitions for Modification of Decision R Order Instituting Rulemaking to Continue Implementation and Administration of California Renewables Portfolio Standard Program. Ratesetting Comr. Ferron/ Judge DeAngelis PROPOSED OUTCOME: Implements the amendments to Public Utilities Code § enacted by Senate Bill (SB) 380 (Kehoe, Stats. 2008, ch. 544, § 1), SB 32 (Negrete McLeod, Stats. 2009, ch. 328, § 3.5), and the more recent amendments enacted by SB 2 of the First Extraordinary Session (Simitian, Stats. 2011, ch. 1) (SB 2 1X). Adopts, among other things: A new pricing mechanism for the Commission’s § Feed-in Tariff (FiT) Program, referred to as the “Renewable Market Adjusting Tariff” or “Re- MAT.” Re MAT includes two principle components. First, a starting price based on the weighted average contract price of Pacific Gas and Electric Company, Southern California Electric Company, and San Diego Gas & Electric Company’s highest priced executed contract resulting from the Commission’s Renewable Auction Mechanism auction held in November This starting price will apply to three FiT product types: baseload, peaking as-available, and non-peaking as-available. Second, a monthly price adjustment mechanism that increases or decreases the starting price in each product type based on the market response. Finally, each accepted project will be paid a time-of-delivery adjustment based on the generator’s actual energy delivery profile and the individual utility’s time-of-delivery factors. Several new or revised FiT Program components, including, among other things, increasing the maximum size of eligible facilities to 3 megawatts, adjusting capacity allocations among the utilities, adopting project viability criteria, and excluding small electric utilities from the program. Denies two petitions for modification of Decision , the decision initially establishing the tariffs and standard contracts for utilities under § , filed by Sustainable Conservation and by Solutions for Utilities, Inc. ESTIMATED COST: Unknown.

Regular Agenda – Legislative and Other Matters Item #50 [11244] Voice Over Internet Protocol and Internet Protocol Enabled Communications Service SB 1161 (Padilla) This bill would prohibit the California Public Utilities Commission from regulating Voice over Internet Protocol and Internet Protocol enabled service (IP enabled serviced providers unless expressly provided otherwise in statute). (Legislative Subcommittee Recommendation: None).

Commissioners’ Reports

Regular Agenda – Commissioner Reports Item #54 [11227] Commissioner Simon’s Report on the Low Income Oversight Board Discussion and Action on Proposed Appointments to the Low Income Oversight Board.

Commissioners’ Reports

Management Reports

Regular Agenda – Management Reports and Resolutions Item #55 [11260] Report and Discussion by Consumer Protection and Safety Division on Recent Safety Program Activities

Fresno County Rail Safety Michelle Cooke Transitional Director Consumer Protection and Safety Division California Public Utilities Commission May 2012

Fresno Area Railroads UPRR Tracks Burlington Northern Santa Fe Railway

Fresno County –Quiet Zones The City of Fresno has two Quiet Zones Quiet Zone 1 - Q is along the BNSF mainline with a 1.8 mile track distance and includes: –Ventura Street, Tulare Street, Mariposa Street (City Hall Pedestrian Crossing), Fresno Street, Divisadero Street, McKenzie Avenue, Belmont Avenue, Olive Avenue, and Hammond Avenue.

Fresno City Quiet Zones (continued) Quiet Zone 2 - Q – is also along the BNSF line with 4.32 miles distance The quiet zone includes: –Figarden Drive, West Avenue, Ashlan Avenue, Fruit Avenue, Palm Avenue

Fresno County High Speed Rail? This week the HSR Authority Board selected the proposed route for the Merced-Fresno section of the HSR project. The Merced to Fresno high speed train section is about 65 miles long and will follow the “Hybrid” alternative. The “Hybrid” parallels the Union Pacific Railroad tracks and State Route 99 between Merced and Fresno.

Fresno County High Speed Rail? To avoid impacts to Downtown Madera, the alignment travels east of Madera and parallels the existing BNSF corridor. The Board also selected the Downtown Merced Station location, and the Downtown Fresno Station at the Mariposa Street location, as part of the HSR system. The CPUC and its Staff have no specific preference for any particular route, and will work with the Authority, freight railroads and local governments to assure the safety of the HSR system and existing freight systems and crossings, irrespective of the route selected.

At-Grade Highway-Rail Crossing Incidents At-Grade Highway Rail Crossing collisions generally result from: –Road User (driver, pedestrian, bicyclist) inattentiveness/distractions –Driving around activated gates and warning devices –Queuing (stopping) on tracks when traffic is congested. –Passive/Private crossings (no gates or flashing lights)

Fresno County In the last 10 years the Fresno County experienced 100 highway-rail crossing incidents.

Fresno, Madera and Kings Counties Statistics The number of crossing incidents are decreasing.

Although incident rates are trending down, between 2007 and 2009 there was a spike in pedestrian accidents and fatalities at crossings in Fresno, including several school children and young adults. CPUC teamed with railroad companies and City representatives to expand the presence of Operation Lifesaver in the Fresno area. The educational efforts appear to be driving the numbers down as Operation Lifesaver presentations are occurring more frequently and directed at the target audience. Remember, the crossbuck at each crossing means yield to the train! Pay attention to the railroad tracks and look both ways before proceeding across the crossing. At-Grade Highway-Rail Crossing Incidents in Fresno

Fresno, Madera and Kings Counties Statistics (cont.)

Actions Taken by CPUC Support local agencies and railroads by nominating at-grade crossings for improvements under the Section 130 Program Support projects nominated by local agencies and railroads for grade separation with the Section 190 Program Review at-grade crossing collisions and recommend safety improvements (install/upgrade active warning devices, signs, markings, preemption, medians, channelization, public education (Operation Lifesaver) etc.) Participate with the Fresno Rail Safety Coalition in efforts to improve safety in the City and County of Fresno Review requests for Quiet Zones

Regular Agenda – Management Reports and Resolutions Item #55 [11260] Report and Discussion by Consumer Protection and Safety Division on Recent Safety Program Activities

Regular Agenda – Management Reports and Resolutions Item #56 [11264] Executive Director Clanon Report Report on the California LifeLine Program’s “Hello, Savings!” Gold ADDY Award for Mixed Media at the Fresno Advertising Federation's 2012 ADDY Awards.

California LifeLine Program’s “Hello, Savings!” Campaign Michael Amato Interim Director, Communications Division California Public Utilities Commission May 10, 2012

California LifeLine Program’s “Hello, Savings!” campaign received a Gold ADDY Award at the 2012 Fresno Advertising Federation’s ADDY Awards on February 24, 2012 (Mixed Media Category) Campaign’s elements: Internet landing page, brochures, posters, banners, radio ads, bus ads, and TV ads Campaign’s collaborative team  JP Marketing (advertising company)  Richard Heath and Associates, Inc.  Communications Division  News and Public Information Office  Division of Ratepayer Advocates  Consumer Service and Information Division Gold ADDY Award Winner

42 Campaign Elements and

Campaign Elements Collateral 1.brochures 2.displays 3.posters 4.banners 5.presentation template

“Hello, Savings!” 30 second Television Ad Campaign Elements

45

Regular Agenda – Management Reports and Resolutions Item #56 [11264] Executive Director Clanon Report Report on the California LifeLine Program’s “Hello, Savings!” Gold ADDY Award for Mixed Media at the Fresno Advertising Federation's 2012 ADDY Awards.

Management Reports

The CPUC Thanks You For Attending Today’s Meeting The Public Meeting is adjourned. The next Public Meeting will be: May 24, 2012, at 9:00 a.m. in San Francisco, CA