SDG&E submitted Advice Letter (“AL”) 3936-E requesting approval of bilateral long-term (“LT”) bundled energy sales agreements with SDCP and CEA. The AL indicates that the 2022 fixed volume sales 2022 represent the same “slices” of SDG&E’s RPS portfolio that will eventually be allocated under the RPS voluntary allocation and market offer (“VAMO”) beginning 2023. As with allocations under the VAMO, the revenues from the proposed sales in 2022 will be credited to the PABA to offset above-market costs.
The Proposed Transactions are intended to reduce SDG&E’s excess RPS portfolio length initially, resulting from load departure to its local CCA LSEs and will follow the voluntary allocation quantities mandated in D.21-05-030 upon commencement of the VAMO process. To justify engaging in the transactions now rather than waiting for the VAMO to commence in 2023, SDG&E states that it began bilateral negotiations before there was certainty surrounding the VAMO and that negotiations were necessary given the complexity of the transactions and the uncertainty surrounding the VAMO at the time.
This filing is subject to Energy Division disposition and should be classified as Tier 3 and will be effective when a Commission Resolution approving the advice letter becomes final. Because the terms of the transaction contemplate deliveries beginning during the second quarter of 2022, SDG&E respectfully requests the Commission issue a Resolution approving this Advice Letter by no later than May 31, 2022.
