PART II: SUBSTANTIAL CONTRIBUTION: Did the Intervenor substantially contribute to the final decision (see § 1802(j), § 1803(a), 1803.1(a) and D.98-04-059). Intervenor’s Claimed Contribution(s) Specific References to Intervenor’s Claimed Contribution(s) CPUC Discussion Summary In this Rulemaking, originally filed in February 2016, the proceeding began with a significant amount of informal work such as workshops, staff concept papers, scenario developments, modeling advisory groups, and GHG emissions targets for IRP’s. Many parties submitted informal comments including UCAN. A proposed Reference System Plan (RSP) was issued September 2017 and a final decision setting the requirements for LSE IRPs was issued February 2018. UCAN’s examination of the issues focused on the best case scenarios for the most flexible Integrated Resource Plans at the least cost to the Load Serving Entities (LSEs) that could simultaneously achieve State GHG reduction mandates but result in the lowest costs to utility ratepayers. D.18-02-018, p. 4, 9, 2 “This proceeding began with a great deal of informal work by Commission staff and parties. Commission staff circulated informal working papers, conducted webinars and workshops, and sought informal party comments over most of 2016 and the first half of 2017.” (p. 4) “On September 19, 2017, an ALJ ruling was issued formally incorporating the modeling results into the record of the proceeding via attachments to the ruling, and seeking comment on a series of questions embedded in the ruling. This September 19, 2017 ALJ ruling represented the staff recommendation for the Reference System Plan (RSP), proposed to be adopted by the Commission.” (p. 9) “The purpose of this decision is to set requirements for all load-serving entities (LSEs) under the jurisdiction of the Commission to file Integrated Resource Plans (IRPs) on or before June 1, 2018.” (p. 2) Verified Issues Verified
Decision D.18-02-018 sets requirements for the LSEs to file IRPs on or before June 1, 2018. These requirements include several of the concepts offered by UCAN throughout the proceeding, including flexibility for LSE’s when developing individual IRPs and in the adoption of GHG reducing generation, as well as consideration of transmission impacts. “UCAN would like to note that we generally support the process suggested by the PD and we support its attempt to provide load serving entities (LSEs) sufficient flexibility to procure least-cost resources that provide the greatest value to ratepayers.” UCAN Comments on PD, p. 3 1. Flexibility for IOU’s when developing individual IRP’s: UCAN supported flexibility for each LSE to develop their own individual IRP that could meet the required targets rather than “top down” mandated portfolios because this would allow each LSE to contribute to statewide goals as efficiently as possible. Ultimately, the Commission adopted this concept and allowed the individual LSEs flexibility to propose alternate portfolios to the reference system portfolio in addition to conforming portfolios. “The ideal LSE IRP should reflect the least cost energy resource additions in which the LSE controls the timing and type of resources added each year to meet the State’s RPS and GHG mandated goals. Each LSE, developing its least cost IRP, should have the flexibility to meet the required targets and each LSE should be able to contribute to statewide goals as efficiently as possible.” UCAN Comments on CPUC Staff Proposal for Implementing IRP, p. 8 June 28, 2017 “Individual LSEs may be able to identify optimal portfolios to serve their load that differ from the mix identified in the Commission reference system portfolio. LSEs should be given flexibility to propose alternate portfolios to meet their customer needs, in addition to conforming portfolios, while justifying any deviations from the reference portfolio.” D.18-02-018, Findings of Fact #9, p. 161 Verified
2. Flexibility for IOU’s in adoption of GHG reducing generation: UCAN supported the concept that if statewide goals could be met, each individual LSEs should not be forced to adopt GHG reducing generation because it could prove to be too costly to ratepayers…and that those LSE’s with lower marginal costs of achieving the next unit of GHG reduction could add more while those with higher marginal costs could add less but still reduce overall state wide GHG emissions. While not addressing this point directly, the Commission did not require the LSEs to procure more renewables at this time, preferring to wait until further evaluation of individual LSE IRP filings to determine any actual need for additional renewable procurement. “Some LSEs may find the marginal cost of achieving the next unit of GHG reduction to be lower than others. Those LSEs with lower marginal cost of GHG reduction could add more and those with higher marginal cost of GHG reduction could add less GHG emissions-reducing generation, which could have the net result of meeting state-wide emission reduction targets with a least-cost effect for California’s ratepayers.” UCAN Comments on PD, p. 5, 6 January 17, 2018 The main goal is to achieve the least cost resource plan while subject to certain statewide regulatory constraints, such as the reduction of GHG emissions. UCAN has previously expressed that LSEs differ in many respects, including historical efforts concerning GHG emissions reduction as well as the need for, and optimal timing of, new resource additions. This flexibility issue is supported in the PD UCAN Reply Comments on PD, p. 5 Each LSE will be required to plan toward adherence to the reference system portfolio, with specific justification given when its plan deviates from the reference portfolio. When it comes to actual procurement, we expect that LSEs will choose the most appropriate and effective resources offered to them that meet their customers’ needs, when analyzing cost, reliability, and disadvantaged communities impacts, among other considerations. Verified
D.18-02-018, p.91 Our preference at this stage is to evaluate the individual LSE IRP filings later this year to determine the extent of the actual need for additional renewable procurement, with the benefit of the LSEs’ individual analysis. We expect some LSEs will have a near-term need for renewables and will propose to procure.” D.18-02-018, p. 152, 153 3. Transmission impact: Early in the proceeding UCAN expressed concern about understanding the impact of several significant regulatory and legislative changes, including the IRP process on California’s transmission infrastructure. While transitioning from the previous LTPP process to the successor IRP process, UCAN cautioned the Commission about moving forward without testing the impact on infrastructure through sensitivity analyses. Specifically, UCAN advised that the Commission should estimate the consequences of both making transmission investments and not making transmission investments. “…as the ALJ Ruling acknowledges, “This A&S document acts as a bridge between the previous LTPP process and the successor IRP process.” But the LTPP timing is also complicated by several significant regulatory and legislative changes, e.g., the transition of residential customers to default TOU rates, SB 350 legislation that mandates increases in RPS from 33 to 50 percent and GHG emissions to 40 percent reduction by year 2030…However, since we know these changes although speculative, are coming, UCAN is concerned about understanding the impact on transmission capacity needed to bring solar and wind resources over long distances to the load centers or the impact of significant growth in BTM solar energy on the grid without at least testing these implications through sensitivity analysis…If we are uncertain about the future in certain respects, we need to estimate the consequences of both 1) making transmission investments and discovering the transmission investments were not needed or 2) not making the Verified
Ultimately, the Commission adopted this concept after SB 338 was signed into law that required the Commission to consider the role of existing clean resources and their attributes when helping to ensure that each LSE meet energy and reliability demands. transmission investments, only to discover the transmission investments were needed…Both types of errors have associated costs and these errors should be minimized to the extent possible.” UCAN Comments on TPP Scenario & Assumptions, p. 3, 4, 6 February 3, 2017 “We also note that during the course of this proceeding, SB 338 (2017, Skinner) was signed into law, which added a requirement to Section 454.52 that the commission consider the role of existing renewable generation, grid operational efficiencies, energy storage, and DERs, including energy efficiency, in helping to ensure that each LSE meets energy needs and reliability needs in hours to encompass the hour of peak demand for electricity, while reducing the need for new electricity generation resources and new transmission resources in achieving the state’s energy goals at least cost to ratepayers. This requirement is implicit in the analysis conducted using the RESOLVE model…(emphasis added) D.18-02-018, p. 35 4. Shadow Prices: As noted above, much of the work in this IRP proceeding was done informally throughout 2016 and the first half of 2017. UCAN robustly participated in these informal discussions by listening to webinars, attending workshops, and providing comments when appropriate. A key “In a constrained optimization problem such as the resource planning process, many constraints, however justified, can adversely impact the cost minimization objective. The effectiveness of these constraints in terms of their impact on cost minimization is estimated using “shadow prices.” Shadow prices are the incremental change in the minimum cost objective associated with an incremental change in the policy Noted