Decision 96-12-075
In this order we halt preparation of the Environmental Impact Report (EIR) studying our preferred policy for electric restructuring. We find that Assembly Bill (AB) 1890 (Stats. 1996, ch. 854.) resolves to move from traditional electric utility regulation to a more competitive scheme, and outlines a new competitive market structure. The EIR's purpose was to study the environmental effects of moving to the market structure outlined in the preferred policy so we could consider those effects in a final decision. However, we now have no discretion to make a decision on moving to a competitive market or to frame the basic structure of that market. In such a situation an EIR is neither appropriate nor necessary.
In response to comments received from agencies regulating air quality matters, our EIR consultant will prepare, outside the context of California Environmental Quality Act (CEQA), a report containing environmental information we have readily available. We also will continue to consider CEQA issues in individual electric restructuring proceedings, if appropriate.
In Decision (D.) 95-12-063, as modified by D.96-01-009, (1995) __ Cal.P.U.C.2d __, we articulated our preferred policy for restructuring California's electric utility industry. (D.95-12-063, as modified by D.96-01-009, is referred to as the Preferred Policy Decision.) We then ordered an EIR to be prepared studying the preferred policy in compliance with the CEQA. (Preferred Policy Decision, p. 228 (Ordering Paragraph 38) (mimeo.).) We anticipated that a final decision adopting an electric restructuring policy would be issued once we had prepared and considered the EIR. (Preferred Policy Decision, p. 217 (Conclusion of Law 108) (mimeo.).) The Preferred Policy Decision represented the proper starting point for CEQA review because we had developed a policy detailed enough to allow consideration of the extent of our CEQA obligations and to allow meaningful review.(1) (Preferred Policy Decision, p. 5 (mimeo).)
We ordered the Commission Advisory and Compliance Division (CACD) (now Energy Division) to prepare an EIR, anticipating that it would engage a consultant to do so. In accordance with CEQA, this EIR would have described the environmental effects of shifting to competition in the manner described in the preferred policy so such information could be considered as part of our decision whether or not to finally adopt the preferred policy. The EIR intended to, among other things: (1) disclose any significant environmental impacts that would result from moving to competition in the manner described in the Preferred Policy Decision; (2) compare the significant environmental impacts of a shift to competition with the environmental situation when the preferred policy was announced; (3) compare the significant environmental impacts of a shift to competition with the impacts that would have resulted from continuing the previous regulatory regime; (4) discuss alternative proposals or modifications to the preferred policy and analyze whether they would be better for the environment; and (5) propose mitigation for the significant adverse environmental impacts, if any, of moving to competition.(2)
While CACD and its consultant were preparing the EIR, the Legislature enacted AB 1890, which the Governor signed into law on September 23, 1996. (Stats. 1996, ch. 854.) That law contains the Legislature's determination that California's electric utility industry should be restructured. (Stats. 1996, ch. 854, § 1(b), p. 3.) It also codifies the Legislature's basic ground rules for a new competitive market structure. (Stats. 1996, ch. 854, § 1(b), (c), (d), (e), pp. 3-4.) These basic rules enshrine some elements of the preferred policy, such as the creation of the Independent System Operator (ISO) and Power Exchange (PX), the institution of a charge to recover transition costs (CTC) and support for direct access. (Stats. 1996, ch. 854, §10, pp. 20-21 (adding Pub. Util. Code, § 330(l).) The statute also offers its own solutions to certain problems, such as the method for recovering certain transition costs. (Stats. 1996, ch. 854, §10, pp. 31-36 (adding Pub. Util. Code §§ 367, 368); see also Stats. 1996, ch. 854, §11, pp. 53-61 (adding Pub. Util. Code §§ 840-847).)(3)
On September 30, 1996, Commissioner Fessler issued a Coordinating Commissioner's Ruling (CCR) addressing AB 1890. With respect to CEQA, the CCR noted that the EIR was being prepared in anticipation of a final decision whether or not to adopt the preferred policy. The CCR stated, "with the passage of AB 1890 it is no longer clear that the anticipated final policy-level electric restructuring decision remains a discretionary responsibility of the Commission." The CCR requested comments from parties who believed the Commission still needed to make a final policy- level decision, and thus continued to need the review contained in the EIR and related CEQA issues.
We received a number of responses to the CCR.(4) Those submitting comments and responses took differing positions on CEQA issues, covering a wide range of responses. Edison, PG&E and SDG&E all stated that no policy-level review was necessary, but for different reasons. On the other hand, a number of parties argued in favor of continuing the policy-level EIR. SL County & School Dist. and CEERT/EDF/NRDC referred to our continued authority over downstream transition issues. BAAQMD, the Monterey Air District and ARB referred to downstream air quality questions possibly raised by restructuring. CCUE pointed out that implementation aspects of electric restructuring would require CEQA review, but the Commission was not required to conduct such review now. Finally, TURN and ORA both urged the Commission to spend time considering the CEQA issue, ORA requesting a further "roundtable."
The enactment of AB 1890 into law presents us with the issue of determining how electric restructuring fits into CEQA's framework. In AB 1890, the Legislature made important policy determinations with respect to electric restructuring. At the same time, we were preparing an EIR in anticipation of a Commission decision making final policy determinations, in light of the information contained in the EIR and other factors. We now must decide whether our EIR, which was designed to inform our final decision on adopting a restructuring policy, should continue in the wake of the Legislature's action to resolve many policy questions in AB 1890.
In this proceeding, we have faced repeatedly the question of how CEQA applies to the unusual process of attempting to reform regulations regarding who produces electricity, and how it is bought, sold and delivered. Previously, we noted that CEQA's central purpose was to inform agencies of the environmental consequences of their decisions. We stated CEQA's essence was the "illumination of the process by which governmental agencies make decisions which may impact the environment." (Interim Opinion, at p. 20 (mimeo).) Following that logic, the Preferred Policy Decision began CEQA review because we had developed a policy that was sufficiently definite to allow meaningful review. (Preferred Policy Decision, p. 5 (mimeo).)
We conclude that a policy-level EIR is no longer necessary by applying the principle we have applied previously with respect to CEQA issues: CEQA is a statute about how state agencies make decisions. If we are no longer to decide whether or not to move from traditional regulation to a more competitive scheme, nor what the broad outlines of the competitive market should be, then there is no reason for us to study the environmental consequences of making such a decision. Certain information may help other agencies, and will be included in a report, although not under the auspices of CEQA.
The Supreme Court has recently stated that CEQA's primary goal is "compel[ling] government . . . to make decisions with environmental consequences in mind." (See Western States Petrol. Assn. v. Sup. Ct. (1995) 9 Cal.4th 559, 574.) The EIR requirement is designed to achieve this basic goal: an EIR informs state agencies of the environmental consequences of their decisions. (Pub. Resources Code, § 21061.) The principle that CEQA review is designed to occur as part of an agency's decisionmaking process is reflected both in CEQA's procedural requirements and in the content requirements for EIRs. Rules on when and how EIRs are prepared look to the type of decision an agency will make, and how it is made. Following the same logic, content requirements for EIRs show that an EIR is prepared for the purpose of informing a government decision.
Procedurally, for example, the CEQA Guidelines(5) specifically point out that the act of approval is a key element that invokes CEQA. The Guidelines provide a definition of "approval," even though one is not provided in the statute, because the concept of approval is "critical to the CEQA process." (Guidelines, § 15352.) The Guidelines state an agency's proposal "to approve some kind of project" creates the responsibility to "comply with CEQA . . . ." (Guidelines, § 15352.) Similarly, CEQA states that it applies only to "discretionary projects" that require "the exercise of judgment or deliberation. . . ." (Pub. Resources Code §§ 21080(a), (b); Guidelines, § 15357.)
The content requirements for EIRs also show that CEQA is designed to ensure that agencies consider environmental factors when they make decisions. (See, e.g., Guidelines, §§ 15120-15132.) The preparation of an EIR meeting specific content requirements "helps ensure the integrity of the process of decision by precluding stubborn problems or serious criticism from being swept under the rug." (Sutter Sensible Planning, Inc. v. Board of Supervis(6)ors (1981) 12 Cal.App.3d 813, 820.) Thus, the statutory definition of an EIR in Public Resources Code Section 21061 states, in relevant part:
"An environmental impact report is an informational document which . . . shall be considered by every public agency prior to its approval or disapproval of a project. The purpose of an environmental impact report is to provide public agencies and the public in general with detailed information about the effect which a proposed project is likely to have on the environment; to list ways in which the significant effects of such projects might be minimized; and to indicate alternatives to such a project."
CEQA's procedural and content requirements make sense only if an EIR is prepared in anticipation of a decision. If the EIR were not to be considered by an agency as it made decisions, it would make no sense for the EIR to suggest alternatives and mitigation. (Pub. Resources Code, § 21100(b)(3)-(4).) Likewise, the requirements that unavoidable significant adverse environmental impacts of a project be disclosed before approval, and that approval include a finding that overriding considerations support approval notwithstanding such impacts, ensure that decisionmakers will consider the environmental consequences of their actions. (Pub. Resources Code, § 21100(b)(1)-(2).) The requirement of a comparison with a "no project" scenario highlights CEQA's relationship to a decision that will be made, since all action that is not undertaken as part of the project approval is studied only for comparative purposes. (Guidelines, § 15126(d)(4).)
Since CEQA's goal is to influence decisions, courts have looked with disfavor on agencies that have conducted environmental review in a way that could not exert influence. The Supreme Court has stated bluntly: "The purpose of CEQA is not to generate paper, but to compel government at all levels to make decisions with environmental consequences in mind. . . ." (Laurel Heights Improvements Assn. v. Regents of University of California (1988) 47 Cal.3d 376, 392-393.)
We approach the question of whether an EIR is still appropriate in light of the passage of AB 1890 with the above discussion in mind. Without explicit guidance from the Legislature on how CEQA now relates to electric restructuring, the determination of CEQA's role turns on the question of what restructuring decisions we are left with responsibility for making.
In their comments on the CCR, parties approached this question as one of whether the Commission retains "discretionary" authority over certain aspects of electric restructuring. (See, e.g. Comments of SL County & School Dist., p. 4; Comments of CCUE, p. 5; Comments of PG&E, pp. 2, 11.) Since electric restructuring has many elements, we believe this question is best answered by determining what decisions we will be called upon to make in the wake of AB 1890. The responsibility to decide certain matters with respect to electric restructuring no longer entails authority to decide all matters, or to make global decisions such as whether or not to restructure electricity regulation at all. Being clear about which aspects of electric restructuring we will decide will help determine the extent of our "discretionary" responsibilities under CEQA.
In determining our responsibilities it is important to distinguish between "policy-level" and "implementation" decisions. A policy-level decision would launch electric restructuring in a particular direction by selecting a restructuring policy, such as the preferred policy, which moves from pervasive regulation to a more competitive scheme based on a particular new market structure. Subsequent implementation decisions would be made during the transition from traditional regulation to the scheme adopted in a policy-level decision. The decisions made during such a transition would implement the move to a more competitive scheme, but they would not be decisions about whether or not such a move would take place. Implementation decisions would modify regulatory programs so they conformed to the policy selected in the prior policy-level decision.
Our Preferred Policy Decision contemplated this approach. Once the decision to shift to a more competitive market was made, and once the contours of that market were defined, we anticipated facing the task of managing the transition. (Preferred Policy Decision, p. 180 (mimeo).) In the Preferred Policy Decision and the original Roadmap Decision we undertook several steps concurrent with the preparation of the EIR. Taking these steps would have allowed us to move forward expeditiously if, following environmental review, we ultimately adopted the preferred policy or a version of it.
In the wake of AB 1890, we find that we are no longer responsible for making a policy-level electric restructuring decision. That is, we no longer have discretion to decide whether or not to move from traditional regulation to a more competitive scheme. Further, we do not have authority to define the overall structure of the new competitive market: the ISO/PX, direct access and transition cost recovery have all been adopted as elements of the move to competition. The authority we have is for regulating the transition to competition by January 1, 1998, for making certain determinations that are necessary to implement the shift to a more competitive market, and for appropriate oversight thereafter.
A review of AB 1890 demonstrates this. The new law determines that California should move from cost-of-service regulation of electric utilities to a more competitive market structure. (Stats. 1996, ch. 854, § 1(a), (b), p. 3.) New Public Utilities Code section 330 codifies this intent in subsections (d) and (e). (Stats. 1996, ch. 854, § 10, pp. 19-20.) The new law further concludes that such a change should be underway by January 1, 1998 and "direct transactions" should be permitted at that time. (Stats. 1996, ch. 854, § 10, pp. 21, 35 (adding Pub. Util. Code, §§ 330(n), 365(b)(1)).)
The Legislature also mandated that the move to more competition be organized along certain lines. AB 1890 requires the new market structure to be based on the ISO/PX. (Stats. 1996, ch. 854, §1(c), p. 3.) Public Utilities Code section 330 states that the new market "is best" organized around an ISO/PX. That section also adopts independent generation, direct access and recovery of certain transition costs, although they receive different treatment from the preferred policy. (E.g., Stats. 1996, ch. 854, § 10, pp. 20-21 (adding Pub. Util. Code, § 330(l)-(s)).) The establishment of such a market structure is assumed throughout the statute. Public Utilities Code sections 334-356 mandate certain procedures for the creation and oversight of the ISO/PX. (Stats. 1996, ch. 854 § 10, pp. 23-25.) Public Utilities Code section 360 requires the Commission to facilitate the establishment of the ISO/PX in proceedings before Federal Energy Regulatory Commission (FERC), while Public Utilities Code section 361 requires the Commission to place development funds held in trust at the order of the Commission at the disposal of the ISO and the PX. (Stats. 1996, ch. 854 § 10, p. 28.) New Public Utilities Code section 330(l)(2) further codifies the preference for a competitive generation market and for a transition of generation facilities to competitive status. (Stats. 1996, ch. 854, § 10, p. 124.)
In addition, new Public Utilities Code section 366 establishes a refined process that customers can use to choose direct access. (Stats. 1996, ch. 854, § 10, pp. 30-32.) With respect to public purpose programs supporting renewable energy, research, development and demonstration (RD&D), conservation, and low-income assistance, AB 1890 sets out a funding scheme, certain elements of which we are to address. (Stats. 1996, ch. 854, § 10, pp. 43-47, adding Pub. Util. Code, §§ 381-383.) The Commission is required to continue low-income assistance programs at existing funding levels. (Stats. 1996, ch. 854, § 10, pp. 45-47, adding Pub. Util. Code, § 382.) The Commission is further required to ensure that certain amounts are collected and disbursed for conservation, renewables and RD&D. (Stats. 1996, ch. 854, § 10, pp. 43-45, adding Pub. Util. Code, § 381.) Some of these funds are to be administered by the Energy Commission. (Stats. 1996, ch. 854, § 10, pp. 45, 46, adding Pub. Util. Code, §§ 381(f), 383(a).)
Finally, AB 1890 establishes a method to recover transition costs (Stats. 1996, ch. 854, § 10, pp. 31-36 (adding Pub. Util. Code §§ 367, 368), § 11, pp. 53-61 (adding Pub. Util. Code, §§ 840-847).) AB 1890 allocates the Commission the responsibility for quantifying transition costs. However it does so within numerous parameters established for "cost recovery plans" and under a scheme allowing for financing that is intended to produce immediate rate freeze and 10% reductions for residential customers beginning January 1, 1998. (Stats. 1996, ch. 854, § 10, pp. 35-36, adding Pub. Util. Code, §§ 368.)
Since, in the wake of AB 1890, we no longer have discretion over policy-level questions, policy-level CEQA review is no longer required or appropriate. In a discretionary decision, an agency "exercise[s] judgment or deliberation" when it "decides to approve or disapprove a particular activity." (Guidelines, § 15357.) Discretionary actions are often defined as the opposite of ministerial actions, where an agency exercises "little or no" judgment "as to the wisdom or manner of carrying out the project." (Guidelines, § 15369.)
In Friends of Westwood, Inc. v. City of Los Angeles (1987) 191 Cal.App.2d 259, 273, the court asked "why it makes sense to exempt the ministerial ones [projects] from the EIR requirement." The court answered:
"…for truly ministerial permits an EIR is irrelevant. No matter what the EIR might reveal about the terrible environmental consequences of going ahead with a given project the government agency would lack the power (that is, the discretion) to stop or modify it in any relevant way. The agency could not lawfully deny the permit nor condition it in a way which would mitigate the environmental damage in any significant way. The applicant would be able to legally compel issuance of the permit without change. Thus, to require the preparation of an EIR would constitute a useless—and indeed wasteful—gesture."
(Friends of Westwood, supra, 191 Cal.App.3d at p. 272.)
We view the policy-level electric restructuring EIR as analogous to the ministerial EIR discussed by the court. Policy-level issues of change to competition and market structure are also the focus of the EIR. The Preferred Policy Decision notes the EIR would study a proposal to adopt a policy direction rather than a specific plan stating, "[d]ue to the general nature of this policy, the scope of this EIR will be more conceptual than a site-specific EIR would be." (Preferred Policy Decision, p. 178 (mimeo).) The Preferred Policy Decision points out that the issue studied in the EIR would be the effect of changing regulatory policy itself, and anticipated that the effect of policy change would be studied "by anticipating likely future scenarios that would develop under our policy." We in fact anticipated that subsequent implementation decisions may have required their own specific environmental review. (Final Technical Group Work Plan, pp. 2-3.)
As a result, even if the policy-level EIR revealed that regulation was vastly superior for the environment, we could not lawfully decide to stop the emergence of competition on January 1, 1998. Similarly, we do not have authority to decide the overall structure of the new market. We could not, for example, decide that a "PoolCo" proposal or a pure direct access approach without the ISO/PX should be pursued.
Thus, preparation of an EIR should be halted for two reasons. First, since we do not have discretionary authority over the decision to move to competition or over the basic structure of the competitive market, there is no trigger for CEQA review of those actions. Second, and more important, CEQA's objectives are not met by describing environmental factors when we cannot make a decision that takes advantage of such information. The EIR now being prepared would not help with CEQA compliance.
While AB 1890 does not leave us with discretion to make fundamental policy-level electric restructuring decisions, we do have responsibility to manage the transition to a more competitive market structure.
In their comments on the CCR, several parties urged us to continue policy-level environmental review to satisfy CEQA's requirements with respect to implementation decisions. SL County & School Dist. argued that a number of implementation decisions, "taken together, constitute a 'project'" that would require policy-level environmental review. (Comments of SL County & School Dist., p. 2.) (7) CEERT/EDF/NRDC also claimed that implementation actions entailed policy-level discretion and stated the benefits those parties felt policy-level environmental review might provide.(8) BAAQMD, the Monterey Air District and ARB indicated that review of restructuring would play an important role in their review of plant emissions standards.
As discussed above, we see our implementation actions as distinct from the fundamental policy-level decision. We disagree with both the contention that subsequent implementation actions entail making policy-level decisions and the claim that implementation actions add up to a policy-level decision. Our implementation actions in electric restructuring and its sub-proceedings will, for example, address requests to transfer ownership, review rates and devise new rate structures, review the utilities' cost recovery plans, and undertake proceedings to set the amount of CTC and review financing orders. (Stats. 1996, ch. 854, § 10, pp. 34-36 (adding Pub. Util. Code § 368).) This type of action does not address whether or not a more competitive scheme should replace traditional regulation. No action we could take during the transition to a more competitive market structure would allow us to retreat from the move to a structure based on the ISO and the PX or forestall the advent of direct transactions in this market.
Moreover, issue-specific implementation decisions do not add up to the equivalent of a policy-level decision on electric restructuring. The Commission's downstream decisions are not separate parts of a policy decision, they are something different. These decisions focus on how to regulate the transition to a more competitive scheme now that the Legislature has decided to move in that direction. Our discretion in managing the transition to a more competitive market is not so great that we effectively have the ability to choose whether or not electric restructuring goes ahead, and in what form. Our future decisions on the price certain nuclear generation facilities should bid into the PX, our decisions on whether to approve the sale of other generation facilities, our decisions on the mechanics of direct transactions and on what amounts are properly recovered through the CTC are implementation decisions about how the new regulatory framework should operate. Within the parameters of those decisions we see no room for us to exercise authority to determine whether regulation should be reformed or what the overall structure of the scheme should be.
The comments acknowledge this when they note that a policy-level EIR would now no longer be able to study a "no project" alternative.(9) An EIR must compare the project it studies to "existing conditions and what would be reasonably expected to occur" if that project were not approved. This comparison is achieved by comparing the project to a mandatory "no project" alternative. (Guidelines, § 15126(d)(4).) If we cannot consider "no project" as an alternative to our preferred policy, we do not believe we have discretion with respect to the preferred policy. To say that the "no project" comparison is no longer required is another way of saying that the project being studied is already part of the "existing conditions." And if that were the case, the agency preparing the EIR would not have discretion over whether or not to approve the project.
Commentors also claim that a policy-level EIR is required to develop alternatives and mitigation, in the context of subsequent implementation decisions we will make. (See, e.g., Comments of CEERT/EDF/NRDC, at p. 4.) However, if we have no discretion over the decision to move to competition, we do not have authority or responsibility for mitigation with respect to that project. CEQA review of each implementation decision does not constitute a piecemeal review of "comprehensive policy change," as SL County & School Dist. claims in its reply comments. (Reply Comments of SL County & School Dist., p. 4.) Implementation involves review of those actions we have discretion to approve (such as electric utility rates) given the background of a previous decision on policy issues (such as the move to competition). We will properly review such actions, but we note our decisions to reform regulation given the onset of a new market is not a part of the decision to move to that market structure.
Finally, we wish to point out that the question we face here is different from the question we faced in the Preferred Policy Decision. There, we hoped to take action that we were not convinced was a "project" but decided to prepare an EIR in any event. Here, we no longer have the ability to take action on fundamental policy-level issues. Even if we prepared an EIR in any event, that EIR would not be able to inform a decision of ours. This is the opposite of the situation we faced in the Preferred Policy Decision where we intended the EIR to inform our final decision on electric restructuring. The benefits we found in preparing an EIR in any event will not accrue here.
Thus, we conclude it is appropriate to stop preparing the policy-level EIR studying our preferred policy. We will prepare a report containing the information that we think would be most useful to other agencies who need to regulate in the new competitive market.
We have received comments indicating that other agencies would receive benefit from environmental analysis that would be helpful in their decisionmaking process. BAAQMD, the Monterey Air District and the ARB all stated that an overall analysis of air quality issues would help them discharge their responsibilities in a competitive electricity market. We believe it is proper to provide these agencies with what information we have easily available that may be of assistance in pursuing their respective mandates.
Thus, we will order our Energy Division to continue to work with the EIR consultant to provide a report, outside the context of CEQA, so agencies will not have to replicate information readily available to us. An ensuing report will compile the relevant environmental information developed for the policy-level EIR in a form that can be made available by March 1997. In response to comments received, particular emphasis will be on air quality impacts, although we will not conduct analysis or adopt any new approach not used in connection with preparation of the policy-level EIR.(10) Since it has been the subject of interest, this report will discuss the potential for increased emissions from power plants and the emissions level increases that could trigger new air quality permitting by individual air districts. However, we will not attempt to meet content requirements for an EIR, nor will we make findings as we would be required to make under CEQA.
Conclusions of Law
THEREFORE, IT IS ORDERED THAT:
This order is effective today.
Dated December 20, 1996, at San Francisco, California.
A. GREGORY CONLON
A. President
B. DANIEL Wm. FESSLER
C. JESSIE J. KNIGHT, JR.
D. HENRY M. DUQUE
E. JOSIAH L. NEEPER
F. Commissioners
(1) We have had CEQA under consideration since shortly after we began this proceeding in Order Instituting Rulemaking on the Commission's Proposed Policies Governing Restructuring California's Electric Services Industry and Reforming Regulation Etc., R.94-04-031 & I.94-04-030 (mimeo). We first considered environmental review in Interim Opinion: Procedural Schedule, Call for Briefs, and Applicability of CEQA. [D.94-12-007] (1994) __Cal.P.U.C.2d __ (Interim Opinion). In response to a motion of the Natural Resources Defense Council (NRDC) we determined to take up CEQA issues once we had framed our policy. When we framed a policy in the Preferred Policy Decision, we addressed CEQA issues. However, the timing of the EIR was subject to applications for rehearing. Nothing in this Decision should be construed as superseding any decisions which may be taken as a result of those applications for rehearing.
(2) See, Final Technical Group Work Program, July 22, 1996, prepared by CACD's consultant, Greystone, for the Commission in this proceeding. It is referred to by San Luis Obispo County and San Luis Coastal Unified School District (SL County & School Dist.) in their comments on the Coordinating Commissioner's Ruling of September 30. (Comments of SL County & School Dist., p. 4) The Work Program, and the accompanying Scoping Report were widely available through the EIR process and published on the EIR Internet web-site. (See, Scoping Report, pp. 2-4.) These documents are necessary to this decision and are therefore added to the record. Energy Division is directed to submit copies to the formal file.
(3)3 The Commission is to identify and determine those costs and categories of costs for generation-related assets and obligations which may become uneconomic as a result of a competitive generation market.
(4) We received comments from the following parties: jointly filed comments of California Cogeneration Council, Independent Energy Producers Association and Watson Cogeneration Company (CCC/IEP/Watson); jointly filed comments of California Large Energy Consumers Association and California Manufacturers Association (CLECA/CMA); jointly filed comments of the Center for Energy Efficiency and Renewable Technologies, Environmental Defense Fund and the Natural Resources Defense Council (CEERT/EDF/NRDC); Coalition of California Utility Employees (CCUE); California Energy Commission (CEC); Office of Ratepayer Advocates (ORA); Pacific Gas and Electric Company (PG&E); San Diego Gas & Electric Company (SDG&E); jointly filed comments of SL County & School Dist.; Southern California Edison Company (Edison); and Towards Utility Rate Normalization (recently renamed as The Utility Reform Network) (TURN). (TURN's motion to accept late-filed comments is granted.) The Bay Area Air Quality Management District (BAAQMD) submitted a letter to the EIR project manager. Reply Comments were received from: Enron Capital & Trade Resources (Enron); PG&E; SDG&E; CCC/IEP/Watson; and SL County & School Dist. Further letters were received by the EIR project manager from: BAAQMD; Monterey Bay Unified Air Pollution Control District (Monterey Air District) and Air Resources Board (ARB). CEC, CLECA/CMA, Enron, and CCC/IEP/Watson did not address CEQA issues. Letters submitted to the EIR project manager pursuant to the CCR were available to all parties via the EIR web-site, as indicated in the CCR. They are necessary for this decision and are therefore added to the record. Energy Division is directed to submit copies to the formal file.
(5) Regulations interpreting CEQA are referred to here as the "Guidelines." The Guidelines appear at California Code of Regulations, title 14, sections 15000-15387, including Appendices A-K.
(6) The decisions listed by SL County & School Dist. are: determination of accelerated depreciation and "must-take" status for Diablo Canyon; unbundling of pricing and rate design; determination of transition cost level for Diablo Canyon; allocation of research, environmental and low-income funds; setting of inspection, maintenance, repair and replacement standards for transmission and distribution; and determination of divestiture issues with respect to non-nuclear generation.
(7) Those actions are: generation and distribution performance-based ratemaking (PBR); regulation of generation facilities (sale, transfer, "must-run" status and operation in a competitive market); public purpose programs; and direct access as it affects renewable generation. (Comments of CEERT/EDF/NRDC, p. 4.) CEERT/EDF/NRDC also claim that review of the whole of restructuring entails review of policy-level actions.
(8) On page three of its comments SL County & School Dist. note, "the Commission has been divested of any discretion to consider a 'no project alternative' that does not reflect the requirements of AB 1890." Similarly, CEERT/EDF/NRDC's comments state on page four, "consideration of a 'no project' alternative might no longer be appropriate as a result of AB 1890."
(9) For example, this report will not address questions about individual power plants in specific air basins. Nor will it conduct Urban Airshed Modeling or equivalent dispersion, fate or chemistry analyses.
d(10)