R. 17-06-026
Following protests submitted by CalCCA, Public Advocates Office and DA parties, Energy Division issued an initial suspension for up to 120 days beginning September 22, 2021. During this period, Energy Division will want protesting parties to work out differences with the IOUs and submit a supplement to modify the original Advice Letters
CalCCA, PAO, and DA parties submitted protests to the Joint IOU AL on September 13, 2021. The protests highlighted various deficiencies and requested that the Commission require the IOUs to provide additional information concerning the mechanics of the RPS VAMO. See below for a summary of CalCCA's protest.
CalCCA submitted protest to SCE AL 4569-E, PG&E AL 6305-E, and SDG&E AL 3835-E proposing load forecasts and RPS methodologies for voluntary allocation of the RPS attributes of the PCIA eligible portfolio. CalCCA requests that Energy Division limit any approval of the ALs to the mechanics of the share and product allocation, consistent with OP 16 of D. 21-05-030. CalCCA recommends the IOUs file a supplemental AL addressing issues raised related to the allocation methodology at the recent workshop, identify and correct any differences in the IOUs allocation methodology as applied to bundled versus unbundled customers. and ensure the details of the VAMO are timely and adequately addressed in the RPS proceeding.
Approval of the Advice Letter Should Be Limited to the Scope of Issues Defined in Decision 21-05-030 Ordering Paragraph 16
- OP 16 requires that within 90 days of its effective date: the IOUs should meet and confer with parties to this proceeding and jointly file a Tier 2 advice letter to propose (i) a methodology for calculating potential Voluntary Allocation shares based on vintaged, annual load forecasts, and (ii) a methodology for dividing their RPS portfolios into shares to be allocated. IOUs should host a joint workshop within 14 days of filing the advice letter to discuss the proposed methodologies.
- Despite the scope of issues defined in D.21-05-030, the Advice Letter goes beyond OP 16, addressing the calculation of payments for allocated shares, the timing of payments, and the calculation of the payment true-up.
- In addition to payment, the AL addresses the timing of transfers of RPS energy and downstream restrictions on further allocation or sale of the products. Neither of these issues were addressed in the IOUs’ meet and confer processes with load-serving entities (LSEs) in advance of the Advice Letter submission, nor were they addressed in the IOUs’ workshop presentation.
The IOUs Should Refine the Proposal Through a Supplemental Advice Letter Filing Addressing Issues Raised During the September 3 Workshop
- Reconfirm that an LSE may take all of its allocation as short-term (including allocations that otherwise would be eligible as long-term) in 10% increments; and may take long-term allocations (also in 10% increments), provided that in total its accepted allocation does not exceed the amount calculated by the IOU as available for allocation to the LSE.
- Confirm that the number of megawatt hours (MWh) allocated may change, depending upon the production levels of the allocated pools, but that the percentage share of the portfolio allocated to an LSE will be set once in advance of a year without later modification.
- Confirm that while the Voluntary Allocation will occur only once per compliance period, and the Market Offer for unallocated resources will be repeated annually.
- Explain whether any changes in the resources included in the short- and/or long-term pool can change during the course of an allocation year and, if so, how and when notice will be provided to LSEs who have received the allocations.
- Confirm that while evergreen contracts and utility owned generation resources will be excluded from the calculation of the term of commitment for a long-term allocation, these resources will still be included in the long-term allocation pool.
- Disclose whether any PURPA contracts have been modified to provide RPS attributes and, if so, whether they will be included in the VAMO.
Treatment of IOU Bundled Customers Must Be Addressed Clearly in the VAMO Allocation Methodology
- Parties appropriately questioned whether long-term contracts with fewer than ten years remaining in their term would lose their long-term value if retained by bundled customers to bring parity with the allocation to other LSEs. For other LSEs, long-term contracts with less than 10 years remaining will be treated as short-term. Similarly, questions arose regarding how IOU bundled allocation will be handled if any portion of the allocation is rejected by the IOU. The Commission must address these and other issues regarding parity between bundled and unbundled customers in the VAMO process in the RPS proceeding.
The Energy Division Should Ensure the Details of the VAMO are Timely and Adequately Addressed in the RPS Proceeding
- The schedule will not permit participating LSEs to know the full terms and conditions of an allocation before they are required to commit. Most critically, the contract form and other key terms and conditions must be final before LSEs can reasonably be expected to make their elections final in May 2022.
- What data and level of granularity will be provided to participating LSEs in advance of their election? At a minimum, when the available allocations are identified in February 2022, they must include a forecast of how a long-term allocation is predicted to change over time, a breakdown by technologies, a breakdown by product type (e.g., PCC 1), and the best available data allowing a participating LSE to understand the shape of its allocation.
- What level and types of credit and collateral will be required?
- When will settlement take place, when will production data be provided, and when will payment occur?
- How will Market Offers be structured around term, product definition, and other key features?
