1. A.07-07-015 Proposed Decision DRA’s comments PG&E and SDG&E applications for Approval of their Separate Emerging Renewable Resource Programs (ERRP)

2. 2 Proposed Decision Summary ERRP establishes funding for research on emerging renewable technologies that fit the renewable resource needs of each investor-owned utility (IOUs). Authorizes PG&E to spend up to $30 million over a two year period. Authorizes SDG&E to spend up to $15 million over a two year period. Maximum funding of $7 million per project. Ratepayers to fund up to 80% of each ERRP project; remaining funds to come from outside sources. Requires renewable technology assessment report to identify technologies that fit the renewable resource needs of each IOU. Provides for an Independent evaluator (IE) hired by ED to review ERRP project solicitations. Sets up a Technical Review Process (TRP) to review emerging renewable technology. Requires projects to be approved through the TRP (in consultation with ED). Rejects Emerging Renewable Resources Coordinating Council (ERRCC). Requires a workshop to address outstanding issues within 90 days of the final decision.

3. 3 Matrix of Issues and Positions IssueSDG&E / PG&EDRAPDDRA’s COMMENTS ERRCCUtilities informed ERRCC about selected projects ERRCC approval prior to project’s approval Rejects ERRCC. Established TRP DRA supports PD. Funding100% ratepayers funding 33% funding from other sources / venture capital (VC) based on gain on sale D.06-12- 043 20% other sources, VC or third parties funding DRA Supports PD as a reasonable compromise. Approval processTier 1 advice letter (AL) process Submit all projects to ERRCC for approval Review process involving technical experts with ED oversight Strengthens the ERRP and makes it more accountable to ratepayers; DRA Supports PD. Intellectual Property (IP) ProprietaryPublic availability of ratepayers’ funded IP WorkshopDRA would like to have a workshop addressing implementations.

4. 4 Issues DRA has concerns about the litany of ratepayer funded research and development programs that are being created under one clean energy guise or another that are increasing the cost of electricity and are not well coordinated. SDG&E / PG&E application is identical to California Institute for Climate Solutions (CICS). Both programs purportedly to enhance renewable R&D. How to avoid duplication of other renewable programs. Additional cost burden on ratepayers. Need to develop a comprehensive Research, Development and Demonstration (RD&D) process or program for all utilities. Need to maintain stronger oversight on research expenditures until overall Commission policy direction is clarified.

5. 5 Recommendations IOUs should identify the gaps in the CEC’s PIER program and recommend modifications and solutions rather than initiate their own ad hoc RD&D. To avoid duplication of projects with California Institute for Climate Solutions (CICS), ERRP should be terminated once the CICS becomes operational. Commission should adopt the PD’s measures to ensure funds are managed efficiently and effectively and increase accountability.