Title: I
Author: OA2000
Last saved by: Lynne Mosley
Company: California Public Utilities Commission

RESTRUCTURING STATUS		updated 06/08/00

06/08/00

State of California	Public Utilities Commission
		San Francisco
M E M O R A N D U M
		www.cpuc.ca.gov

Date:	June 7, 2000 

To:	Commissioners

From :	Douglas Long/Gurbux Kahlon
	Electric Restructure Coordinators

Subject :	Status of Electric Restructuring Matters, and Upcoming Milestones, 
		for Commissioner Reports Discussion

	Attached to this cover memo is a monthly status report on electric restructuring activity since the Commission Meeting held on May 4^th.  This report presents a summary of restructuring activity including upcoming events and filings. Details from prior reports are available on the web site.,

	In our continuing effort to provide more information to the public, this report will be placed on the Commission's Web site following the Commission conference at: 
http://www.cpuc.ca.gov/electric_restructuring/status/status_index.shtml.  

cc:	W. Franklin
	P. Arth
	L. Carew
	P. Clanon
	W. Meyer
             ERT

I.	Ratesetting	4
A.  Revenue Adjustment Proceedings	4
B.	Performance-Based Ratemaking (PBR)	5
C.	Unbundling Revenue Cycle Services/Utility Fees for Direct Access	5
D.	Post-Transition Period Ratemaking Applications (A.99-01-016, et. al.).	6
II.	Transition Costs	6
A.  Annual Transition Cost Proceedings (ATCP - A.98-09-003, et. al.)	6
B.  PU Section 376 Applications (A.98-05-004)	7
C.  Edison’s Application To Recover Capital Additions	7
D.  Qualifying Facilities (QF) Issues	7
III.	Divestiture Proceedings	8
A.  SDG&E Sec. 851 “Divestiture” Application 97-12-039	8
B.  Southern California Edison Application to Sell its Interest In Mohave Coal Plant	9
C.  SCE Application to Sell its Interest in the Four Corners and the Palo Verde Plants	9
IV.	Market Valuation:	10
B.  Edison Application (A.99-12-024) for Authority to Value Its Hydroelectric Generation	11
V. Distributed Generation and Distribution Competition Rulemaking (R.98-12-015)	12
VI.	Direct Access	13
A.	Introduction:	13
B.	Tariffs and Service Agreements for Direct Access (D.97-10-087)	14
C.	Meter and Data Communication Standards (D.97-12-048 and D.98-12-080)	14
D.	Retail Settlements and Information Flow (D.97-12-090 and D.98-11-044)	15
E.	Load Profiling (D.97-10-086 and D.98-12-065)	16
VII. FERC‑Related Issues	16
A.  Investor Owned Utilities	16
1. Settlement in Principle Announced in PG&E’s Fourth Transmission Owner Tariff case	16
2. SDG&E Files Another Complaint against Public Service Company of New Mexico (“PNM”)	17
3.  Testimony Filed in the Out-of Market Charges Docket	17
4.  SCE Proposes and FERC Approves Service Agreement for ARCO	17
5.  FERC Approves Edison and CDWR Amendments to their Power Contract	17
6.  PG&E Files “Reliability Services” Tariff	18
B.  The ISO	18
1.  FERC Denies Requests for Rehearing of Order on Amendment No. 22	18
2.  FERC Approves Tariff Amendment No. 25	18
3.   he FERC Approves Tariff Amendment No. 26	18
4.  FERC Sets the Transmission Access Charge (“TAC”) for Hearing	19
5.  Two RMR Cases Settle; One Awaits a Preliminary Decision	19
7.   The ISO Submits Three New Participating Load Agreements	19
8.  The ISO Files RMR Agreements with TANC	19
C.  The PX	20
1.  FERC Conditionally Accepts PX Expansion of Block-Forward Market to Include Ancillary Services	20
2.  FERC Approves PX Ancillary Services Market	20
3. FERC Grants Rehearing In Part on PX Block Forward Market Application	20
4. The PX Seeks to Sell Daily and Balance-of-the-Month Forwards	20
D.	Miscellany	20
2.  Calpine Files for Market Rates for its new Plants	20
VIII.  Public Purpose Programs	21
A.	Energy Efficiency and Demand Side Management	21
B.	Low-income Programs	21
C.	Structure and Operating Procedures of LIGB and CBEE	22
D.  California Board for Energy Efficiency	22
E.	 Low-Income Governing Board  (LIGB)	22
IX . CEQA Issues Related to Divestiture of Hydro and Fossil Generation	22
X.   Reliability	23
PG&E Distribution Reliability	23
XI. Consumer Education/Protection	24
A.	The Commission’s Outreach Plan	25
B.	The Electric Education Trust	25
C.	Consumer Protection	25

I.	Ratesetting
A.  Revenue Adjustment Proceedings
The purpose of the RAP is to consolidate the revenue requirement adjustment associated with each utility's various proceedings and ratemaking mechanisms, verify the "headroom" to be transferred to the transition cost balancing account, streamline and eliminate unnecessary balancing accounts, and consider general rate design and revenue allocation issues.  Pursuant to D.99-06-058, PG&E, SDG&E, and Edison filed their 1999 RAP applications in August, 1998.  Included in these filings are the utilities' proposals to modify the PX credit to include certain procurement costs related to purchasing energy from the Power Exchange. 

Hearings in the RAP proceeding have concluded and opening and reply briefs have been filed. A proposed decision should be forthcoming in the next several months. 

The major issue in dispute is the calculation of the PX procurement credit.  D.99-06-058 directed the utilities in this RAP proceeding to determine the non-commodity costs (such as demand forecasting, energy scheduling, interaction with the PX/ISO) associated with their purchases from the PX and to allocate these costs on a per/kWh basis to the PX credit that customers receive.  The purpose of this credit would be to reflect that ESPs incur similar costs in their procurement activities for their direct access customers.

The major revenue requirement issue is the allocation of RMR costs between wholesale and retail customers.  Currently all RMR costs are collected from retail customers while arguments have been made that wholesale customers of the utilities also benefit from these contracts and should pay a portion of their costs.  PG&E has filed a proposed settlement agreeing to seek recovery of its future RMR costs from both its retail and wholesale customers.  Edison continues to litigate this issue.

Edison has reached a proposed settlement agreeing to forego recovery of costs assigned to its Jurisdictional Allocation Memorandum Account (JAMA) .  This account tracked the portion of Edison’s total revenue requirement that was non-CPUC jurisdictional and was assigned (prior to restructuring) to be recovered from its wholesale customers. 

D.99-06-058 addressed the utilities 1998 RAP applications.  This decision;

•	Allocated the costs of implementing electric restructuring ("Section 376 costs") on an EPMC basis and in the same manner as transition costs are currently being collected
•	Allocated transmission and distribution, public purpose, nuclear decommissioning costs , and various memorandum and balancing accounts between customer classes
•	Eliminated various memorandum and balancing accounts that are no longer needed
•	Continued the allocation of PX start-up costs to all customers
•	Changed the "Post-Real Time" settlement costs of the Power Exchange.

B.	Performance-Based Ratemaking (PBR)

On February 17, 2000, the Commission issued its decision in the PG&E GRC, D.00-02-046.  In that decision, the Commission suspended any action on the design, productivity assumptions, and financial structure for  a PG&E PBR, but indicated it will address service quality issues in A.98-11-023.   On March 23, 2000, PG&E filed a Petition to withdraw its Application 98-11-023.  In that Petition, PG&E indicated it would file a new application to address service quality performance standards.

SDG&E filed its annual PBR performance report for 1999 on March 15, 2000.

SCE's electric distribution rates have been updated with an effective date of January 1, 2000 using its PBR mechanism.  SCE filed its annual PBR performance report for 1999 on April 14, 2000.  A resolution on SCE's 1997 PBR performance was issued on April 6, 2000.

Sierra Pacific filed a proposal for an electric distribution PBR on December 31, 1999, A.99-12-041.  ORA filed a protest, requesting that Sierra Pacific refile its application. 

C.	Unbundling Revenue Cycle Services/Utility Fees for Direct Access
 (A. 99-03-013, et. al./A.99-06-033, et. al.):

Hearings, which began Monday, 24 April provide a record for the Commission to either affirm existing policy, alter or create new policy in the following areas:  

•	Geographic de-averaging of meter reading credits
•	Determine proper policy:  RCS credits vs. charges
•	Address the issue of Meter Services, Reading and Billing Long Run Marginal Cost (LRMC)
•	Treatment of New Meters/ Meter Installations
•	RCS LRMC calculations/Methodological issues
•	Billing and Payments
•	Meter ownership LRMC
•	Direct Access customer switching, billing, metering and meter data management services
•	Extensions to Line Extension Rules
•	Cost Recovery for Utility Distribution Company (UDC) expenditures that facilitate retail market competition
•	Authorization for UDCs to collect exception fees (fees for services to ESPs)
•	Authorization for monopoly UDCs to compete in unregulated markets 
•	Stranded Cost Recovery (RCS/DASF related)

Closing Arguments May 10
Proposed decision by ALJ Wetzell expected by 10/10/00
Final Decision by the Commission proposed 12/21/00

D.	Post-Transition Period Ratemaking Applications (A.99-01-016, et. al.).

On January 15, 1999, PG&E, SCE and SDG&E filed the applications which propose methods of identifying the end of the transition period and establishing ratemaking mechanisms for the subsequent period.  Commissioner Duque issued a scoping memo on March 11.  The proceeding addresses the criteria that must be met in order to end the rate freeze, and ratemaking matters such as balancing account treatment for energy  procurement costs and ongoing CTC recovery.  The scope of the proceeding will also include broad rate design matters which are integral to ending the rate freeze and the development of post-transition ratemaking.  The Commission considered the mechanics of ending the rate freeze in Phase 1.  In October 1999 the Commission issued D.99-10-057 in Phase 1 of the proceeding.  The issues being considered in Phase 2 involve post-transition rate regulation including regulation of the utilities’ procurement costs, and various cost allocation issues.  A proposed decision in Phase 2 is expected in June 2000.

II.	Transition Costs

Transition costs are generation asset related uneconomic costs that utilities will have an opportunity to recover through the Competition Transition Charge (CTC).  These costs also include Restructuring Implementation Costs.

A.  Annual Transition Cost Proceedings (ATCP - A.98-09-003, et. al.)

•	On September 1,1999, PG&E, SCE and SDG&E filed their first applications in their annual transition cost proceedings.  The purpose of the ATCP is to:
a.	review entries to the must-run and non-must-run memorandum accounts to ensure that excess revenues are properly credited to the TCBA,
b.	adjust accelerated depreciation and account for the results of divestiture proceedings in the TCBA; 
c.	adjust the TCBA for generation capital additions and QF contract buyouts, and
d.	review the reasonableness of costs and revenues from the ISO and PX, employee related transition costs, purchased power, and QF contract administration. 
•	The final decision was voted on February 17, 2000 as scheduled for the 1998 ATCP. It was mailed February 18, 2000. Commissioner Duque issued an ACR to correct the error in D.00-02-048 regarding interim credit to the TCBA without a corresponding debit in another account. Parties were required to comment by March 15, 2000. A decision is expected on the matter by May 31, 2000. 
•	The Assigned Commissioner for the 1999 ATCP issued a scoping memo on November 23, 1999. The following is the schedule for the 1999 ATCP:

February 23, 2000				ORA testimony 
April 3							Rebuttal testimony 
March 29						Utility updates due to 1998 ATCP decision. 
       April 17						ORA/intervenor testimony 
May 1							Utilities’ rebuttal on updates
May 5							Second Pre-hearing conference
May 15 – 26					Hearings

B.  PU Section 376 Applications (A.98-05-004)

The Commission adopted Decision 99-05-031 at the May 13 meeting.  This decision approves settlements on issues in SDG&E’s A.98-05-006 and PG&E’s A98.95-004 relating to restructuring implementation costs to which PU Code Section 376 applies.  On May 18, 1999 SCE, et.al. filed a joint motion for adoption of settlement in A.98.95-015 addressing SCE’s restructuring implementation costs.  A PD on SCE’s application was issued on July 6, 1999 and later modified. The final Decision was voted out on September 16 and mailed September 23, 1999. 
C.  Edison’s Application To Recover Capital Additions 

On April 19, 1999, Edison filed an application requesting recovery of capital additions made to its fossil and hydroelectric generating facilities between January 1, 1997 and March 31, 1998 and to its oil/gas-fired generating facilities between March 31, 1998 and the date of divestiture of the facility.  The application has been protested by ORA and TURN.  An evidentiary hearing was held on February 7-11, 2000 and the record was held open for late-filed exhibits.  An additional day of hearing was held on March 10^th.  Reply briefs were filed on April 14, 2000.  
TURN has filed a petition for modification of the decision on Edison’s 1996 capital additions. (D.99-03-055.)
D.	Qualifying Facilities (QF) Issues
Recent Activity
The main activity currently under way in the QF world is the proceeding implementing P.U. Code Section 390 – O.I.R.99-11-022. On January 4, 2000 the Assigned Commissioner issued the Scoping Memo for this proceeding, outlining the issues and establishing a procedural schedule.  The proceeding has been divided into two phases.  Testimony on most phase one issues was filed on February 11.  Hearings on these issues were held from April 3 through April 11.  Per the schedule, a workshop on line loss issues was held in February.  The final workshop report was issued by the Energy Division on April 7, 2000.  Hearings on line loss issues are to be held May 11 and 12.  A Proposed Decision is expected by September 5, 2000.

Resolution E-3657: February 17, 2000
PG&E - Ultrapower3 QF Contract Restructuring Agreement
On October 13, 1999, PG&E filed Advice Letter 1927-E, seeking Commission approval for an agreement terminating the ISO4 QF contract with Ultrapower 3. PG&E estimates net ratepayer benefits of between $12.1 and $12.7 million. The agreement also provides for a PG&E shareholder incentive payment of $1.09 million. The buyout agreement is approved without modification.

Resolution E-3643: December 2, 1999
PG&E - Calpine Gilroy QF Contract Restructuring Agreement
This resolution approves the agreement reached between Calpine Gilroy L.P. and PG&E regarding the termination and buy-out of an Interim Standard Offer 4 power purchase contract. This resolution also approves recovery of all payments PG&E will make pursuant to the agreement and recovery of shareholder incentives. This is in response to Advice Letter 1906-E, filed September 1, 1999.

Rulemaking 99-11-022: November 18, 1999
Order Instituting Rulemaking (OIR) into Implementation of Pub. Util. Code § 390.
This proceeding is opened to address certain issues related to the prices paid to Qualifying Facilities (QFs) for energy and capacity. Specifically, the Commission will address the provisions in P.U. Code § 390 that establish various criteria for basing short run cost (SRAC) energy payments on the Power Exchange (PX) market-clearing price, as well as the specific index to be used for the QF energy payment. The Commission will address the issues associated with line losses in this proceeding, initially through Energy Division (ED) workshops. The Commission will address all other issues through testimony, formal evidentiary hearings, and workshops, as necessary. 

Decision 99-11-025: November 4, 1999
Regarding Motion for Power Exchange-Based Pricing Under Pub. Util. Code § 390(c).
On July 1, 1999, several Qualifying Facilities (QFs) filed a motion requesting the Commission's approval for short-run avoided cost (SRAC) energy payments to be based on the Power Exchange (PX) market-clearing price for those QFs that voluntarily elect such an option. The decision grants this motion on an interim basis, subject to true-up. As parties had requested, the interim payment which electing QFs will receive will be the PX's zonal, day-ahead market clearing price. Payments made under this regime will be trued up to the level determined in the larger Section 390 OIR which the Commission is opening. 

For the most up-to-date information, check the Energy Division QF Web Site at: www.cpuc.ca.gov/divisions/energy/QF_issues/qf_main_page.htm/

III.	Divestiture Proceedings  
A.	SDG&E Sec. 851 “Divestiture” Application 97-12-039

SDG&E filed its divestiture application on December 19, 1997 to divest all of its fossil plants, its 20% interest in SONGS nuclear power plant as well as all of its long term power purchase contracts.  On February 18, 1999, the Commission approved (D. 99-02-073) the sale of the Encina power plant and 17 combustion turbines by SDG&E to a consortium comprised of Dynegy Power Corporation and NRG Energy Inc.   Encina and the combustion turbines had a combined net book value as of December 31, 1997 of $94.8 million.  The sale price was $ 356 million. 

 D. 99-03-015 issued on March 4, 1999, approved the sale and donation of the South Bay Power plant to the San Diego Unified Port District.  Under the agreement, the Port District will pay $110 million for the plant to SDG&E and SDG&E will provide the Port District with a charitable donation of the main plant site land, the LNG Parcel, the Transmission parcel and the value of the South Bay plant facilities which exceeds $110 million.  The Port District has leased the plant to Duke Energy for operation.  

The Commission issued D. 99-12-020 on December 2, 1999 authorizing SDG&E to conduct an auction to sell off its QF and inter-utility power purchase contracts.  This decision directs SDG&E to meet and confer with ORA after the conclusion of the auction and provide ORA with information supporting SDG&E’s bid selection.  SDG&E will receive 10% of the savings resulting from the auction as a shareholder incentive. SDG&E is in the process of conducting the auction.

SDG&E filed to withdraw its application to divest its share of the SONGS ownership on November 5, 1999. 
B.  Southern California Edison Application to Sell its Interest In Mohave Coal Plant 
Application 99-10-023

On October 14, 1999, Southern California Edison filed its application under P.U. Code 851 to sell its ownership interest in the Mohave coal plant located in Clark County, Nevada.  Mohave is a 1580 MW plant.  Edison owns 56% of the plant.  The remainder is owned by LADWP,  Nevada Power Company and the Salt River Project.  Edison has proposed a three-stage auction process similar to the one used for fossil plant divestiture.  Edison requests the Commission to find that Edison’s proposed sale is not a project under CEQA, or in the alternative find that a Negative Declaration under CEQA is appropriate. 

The Commission issued its decision (D. 00-04-009) authorizing Edison to go ahead with the proposed auction.  The decision also approved the ratemaking treatment proposed by Edison with respect to the net sale proceeds and environmental liabilities.

C.	 SCE Application to Sell its Interest in the Four Corners and the Palo Verde Plants
 A. 00-05-024

Southern California Edison filed an application for approval of its sales agreements to divest its share of the Four Corners coal plant and the Palo Verde nuclear plant.  Four Corners is a 2040 MW coal plant in New Mexico. Edison is a partial owner of units 4 and 5 which have a combined rated capacity of 1480 MW.  Edison’s share is 48% of this capacity.  Palo Verde is a 3-unit nuclear plant with rated capacity of 3810 MW.  Edison owns 15.8% of it.  The buyer of Edison’s interest in both of these plants is Pinnacle West Energy Corporation (PWE).  The total sale price is $550 million with $300 million allocated to Four Corners and $250 million to Palo Verde. PWE agrees to buy both of these facilities “as is”.  Under the agreements, for a fixed period of time, Edison has the right to conduct an auction of these assets.  PWE has a right to match the highest bid price resulting from the auction if it wants to buy the plants.    

IV.	Market Valuation: 
 A.  PG&E Application for Market Valuation of Hydroelectric Generating Assets (A. 99-09-053)

On September 30, 1999, PG&E filed an application to market value and divest hydroelectric generating plants and related assets pursuant to P.U. Code sections 367(b) and 851. PG&E plans to market value these assets through an open auction in which all market participants, including PG&E’s affiliate company PG&E National Energy Group may compete for ownership of the facilities.  The auction process proposed is similar to the one followed for fossil plant sales. 

Scoping Memo and Ruling of Assigned Commissioner and ALJ was issued on January 13, 2000.  It states that CEQA applies and that the Commission will likely prepare an EIR. It schedules a decision certifying the EIR and addressing whether divestiture is in the public interest and the specifics of any divestiture approach (like an auction) for late 2000.  In the event that some divestiture is approved, the ruling envisions that divestiture to occur in early 2001 and schedules a decision on PG&E's compliance with the Commission's divestiture decision for June 2001. It also requires PG&E to make relevant information, including the information it intends to make available to bidders in a "data room," available to all parties to the proceeding.  ALJ Hale is the designated principal hearing officer in this case.  The Ruling prohibits PG&E from withdrawing this application without the express authority of the Commission.
 
ORA filed a motion on January 13, 2000 to request the Commission to order PG&E to revise the estimates of market value of its hydro-electric facilities to $ 2 billion, which according to ORA is still a conservative value. ALJ Hale issued a ruling on January 18, 2000 directing parties to file any responses to ORA’s motion by January 26, 2000. ORA was allowed to file a response by February 1, 2000.   Agricultural Energy Consumers Association, California Industrial Users, California Large Energy Consumers/ California Manufacturers Association, East Bay Municipal Utility District, ENRON, and PG&E filed responses.  ORA filed its reply to these responses on February 1, 2000.  This motion has not been ruled on.

On February 2nd, a Ruling was issued by the Assigned Commissioner and ALJ Hale regarding access to information by parties.  The Ruling directed PG&E to remove the non-compete requirement from its confidentiality agreement filed on January 25, 2000.  The Ruling also directed PG&E that when any information involving a contractual relationship is provided to parties, PG&E must also provide information that will advise parties how to contact the other party to that contractual relationship. 

The Assigned Commissioner and ALJ issued a ruling, in response to a motion from a group of parties filed February 28, 2000.  The ruling clarified the scope of environmental effects to be addressed in evidentiary hearings set for April.  The Ruling also indicates the preferred date for receipt of comments on CEQA issues prior to the publication of the draft EIR, and schedules briefs to address the effect the CEQA environmental issues should have on the Commission's determination of whether divestiture is in the public interest.

Five weeks of evidentiary hearings have been conducted.  On April 17, 2000, the assigned ALJ issued a ruling inviting appearances to submit additional testimony limited to the issue of alternative methods of valuation.  Appearances were encouraged to include a discussion of how the alternative method each proposes would effect the public interest issues such as tax and water rights ramifications.  Appearances were invited to submit this testimony on June 8th with rebuttal testimony due on June 23.  Evidentiary hearings on this additional testimony are scheduled to begin June 26.  Concurrent and reply briefs will be due August 14th and September 5^th respectively.  

B.  Edison Application (A.99-12-024) for Authority to Value Its Hydroelectric Generation  
On December 15, 1999, Edison filed an application for authority to value its hydroelectric generation assets and to retain those assets in a regulated utility corporation pursuant to P.U. Code sections 367(b) and 377.  Edison seeks the valuation and authorization in accordance with the terms of a “Memorandum of Understanding for Valuation of the SCE Hydroelectric Generation Facilities and Continued Ownership and Operation Within the CPUC Regulated Utility” (MOU), which Edison has entered into with 14 stakeholders, including TURN, IBEW Local 47, and several environmental and recreation groups. Edison’s application has been protested by ORA, the California Farm Bureau,  Enron Corp., IEPA, and Friant Power Authority.  Responses to the application have been filed by PG&E,  Friant Water Users Authority,  and Reliant Energy Power Generation, Inc.

A PHC was held on February 22, 2000, and a scoping memo reflecting the scheduling and other decisions reached at the PHC was issued on March 21, 2000.  The scoping memo directed the Commission’s Energy Division to convene a workshop so that parties could gain an understanding of the many issues involved in Edison’s proposal, including the questions set forth in Appendix A to the scoping memo.  The workshop was held on May 2, and a draft workshop report was issued for comment on May 19.

Many of the parties in this proceeding are also actively involved in A.99-09-053, PG&E’s application to set a market value for its hydroelectric facilities.  Additional testimony in A.99-09-053 is due on June 8, and additional hearings are scheduled to begin on June 26. In view of this, and the fact that a new ALJ and new Commission staff have recently been assigned to this proceeding, Commissioner Wood and the new ALJ have decided to extend the due date for opening testimony on Edison’s application.  Such testimony will now be due on July 14 rather than on June 12, the date that had been specified in the March 21 scoping memo. 

V. Distributed Generation and Distribution Competition Rulemaking (R.98-12-015)

The Commission initiated Rulemaking (R.) 98-12-015 on December 17, 1998 to consider whether the Commission should pursue further reforms in the structure and regulatory framework governing electricity distribution services. This effort was undertaken as a collaborative effort among the Commission, the California Energy Commission (CEC) and the Electricity Oversight Board (EOB). The goal of this process was to identify the range of issues on distributed generation (DG) and distribution competition, and their interrelationships; and to explore whether a focused analysis of distributed generation or a more comprehensive consideration of distribution competition issues would be more beneficial.

Over 61 parties submitted opening comments on March 17, 1999, to respond to a series of questions and provide views on whether to undertake a more focused consideration of the utility distribution company’s (UDC) role in DG, or a broader look at the overall future role of the UDC. Reply comments from over 37 parties were filed on May 17, 1999.  

A joint agency full panel hearing (FPH) was held on June 1, 1999.  The FPH further explored the interrelationships among issues raised in the parties’ comments and elicited discussions on the procedural steps that can be undertaken to address various issues. Nine parties submitted additional written comments on the FPH questions on June 4, 1999.

Decision 99-10-065 was adopted on November 21, 1999.  This decision summarizes the issues raised in connection with this rulemaking; describes the roadmap that the Commission will follow to address the issues of distributed generation, electric distribution competition, and the role of the utility distribution companies (UDCs); and closes R.98-12-015.  The decision bifurcated the issues into two tracks.  The first track is to address distributed generation issues.  The second track issues will address distribution competition and the roles of the utility distribution companies in a competitive retail electric market.  R.99-10-025 was opened to address the first track issues.  The second track issues will be addressed in a CPUC staff study and report.  The report is to be filed on or before June 2, 2000.

A Scoping Memo was issued by the Assigned Commissioner on January 20, 2000 to address issues raised in the prehearing conference statements of parties and at the December 15, 1999 prehearing conference, and to set forth the schedule for the proceeding. 

The Energy Division held a series of workshops from December 1999 through March 2000 to consider how DG impacts distribution system planning and operations, how the UDCs can identify and incorporate forecasts of future DG deployment into the distribution system planning process. A workshop report was filed on April 17, 2000. 

The CEC also facilitated a workshop process from December 1999 through March 2000 to develop interconnection standards for DG. The CEC issued its workshop report for comment on April 17. 

Parties served testimony on Phase 1 issues on April 12. Phase 1 issues include ownership and control of DG, valuation of DG benefits, net metering, distribution wheeling, consumer education and governmental outreach.

VI.	Direct Access
A.	Introduction:  

The Commission’s basic approach to the implementation of its decisions regarding the structure of the direct access market for electricity has been to direct parties to form “working groups” for the purpose of developing any required new rules, tariffs, and business practices in a consensus-oriented atmosphere.  The Energy Division is responsible for organizing and overseeing the operation of these groups, and ensuring that they function in a fair and productive manner.  The working groups formed thus far are listed below, and the remainder of this section provides an update on the activities of each group:

1.	Tariffs and Service Agreements for Direct Access
2.	Meter and Data Communication Standards
3.	Retail Settlements and Information Flow
4.	Load Profiling

Activity Since Last Update

•	An Administrative Law Judge Ruling was issued, inviting parties to submit comments prior to a Load Profiling workshop, scheduled for June 29, 2000

•	Resolution E-3662 was approved at the Commission’s May 4^th meeting.  This Resolution provides all direct access customers an opportunity to make a one-time selection prior to June 30^th, 2000 as to which method they wish to use to calculate their CTC obligation (residual or average).  All new direct access customers after June 30, 2000 will have their CTC obligations calculated using the residual CTC method.  All existing customers who do not make a selection by June 30, 2000 will continue to have their CTC obligations calculated using the average CTC method adopted by the Commission in D.97-08-056.

Ongoing Direct Access Implementation Activity

Direct Access Implementation Activity Reports are filed by PG&E, Edison, and SDG&E on the 15th of every month.  Check the following URL for electronic copies:  
http://www.cpuc.ca.gov/divisions/energy/Direct_Access/direct_main_page.htm

B.	Tariffs and Service Agreements for Direct Access (D.97-10-087)

Status of Proceeding

Direct Access Tariff Review Group:

Most discussion related to the Direct Access tariffs and service agreements takes place in the monthly meetings of the “Rule 22 Tariff Review Group”, held at PG&E on the first Wednesday of every month.

Participants at the monthly meetings have decided to form a number of “sub-groups” to resolve specific issues between meetings.  These groups operate under the umbrella of a group called the “Operations Coordinating Committee” (OCC).  The sub-groups are listed below.

1.	Meter Specific Services
2.	Billing Business Rules
3.	Meter Usage Data
4.	Internet EDI
5.	MDMA and VEE Issues (MAVI)
6.	Data Quality and Integrity (DQI) 
7.	DASR Consistency/ Account Maintenance (currently inactive) 
8.	Service Delivery Point (SDP) Identifier (currently inactive)
9.	Operations Manual Documentation (currently inactive)
10.	“Start-to-end-process” (STEP) (currently inactive)

The OCC meets at PG&E on the first Tuesday of the month, and provides a report to the Rule 22 Tariff Review Group when that group meets later in the day.

Monthly meeting notes for both the Rule 22 and OCC groups, and other documentation, may be obtained at the website: http://162.15.5.2/wk-group/
C.	Meter and Data Communication Standards (D.97-12-048 and D.98-12-080)
Status of Proceeding

The Permanent Standards Working Group (PSWG) was established by the Meter and Data Communication Standards (D.97-12-048).  Parties met together as the “Permanent Standards Working Group” (PSWG) and submitted their report in July, 1998.  On December 17, 1998, the Commission issued D.98-12-080, which addressed the recommendations made in the PSWG report.

Meter Worker Certification:  Decision 99-03-063 denied an Application for Rehearing of D.98-12-080 filed by PG&E and SDG&E.  The Application related to the meter worker certification process adopted in D.98-12-080.  Instead, the Commission modified Decision 98-12-080 to order all parties to answer two questions regarding the Commission’s adopted certification program.  Parties made these filings on April 6^th 1999.  A Commission decision or ruling on these filings is pending.

Meter Services:  On February 26^th, 1999 Commissioner Duque issued a Coordinating Commissioner Ruling (CCR) requesting comments on issues pertaining to the provision of competitive metering services in the restructured electric industry.  Opening Comments were filed April 13^th, and Reply Comments on April 27^th.  Commission action is pending.

Ongoing Activity

The Energy Division’s “Meter Service Provider Certification Unit” has been reviewing applications and provisionally certifying MSPs to install meters for ESPs in the UDC service territories.  A list of certified MSPs may be obtained from the Commission’s website: http://www.cpuc.ca.gov/electric_restructuring/msp_registration/msp_index.htm

D.98-12-080 directed the Energy Division to develop the appropriate forms, procedures, and criteria for accepting and reviewing Direct Access meter type self-certification forms provided by meter manufacturers, and for posting the complying meter types on the Commission’s web site.  The Energy Division made the forms available on March 19, 1999, and requested an extension on final implementation of the website, to August 1, 1999.  The list is now posted at the following URL:
http://www.cpuc.ca.gov/electric_restructuring/meters/Table%20of%20Contents.htm
D.	Retail Settlements and Information Flow (D.97-12-090 and D.98-11-044)

Status of Proceeding

The Retail Settlements and Information Flow (RSIF) decision established three working groups to address certain issues regarding the information flows that will be required for the new electric market structure to function.  Final reports have now been issued by all three groups:  the “Universal Node Identifier” Working Group, the “Distribution Loss Factor” Working Group, and the “Data Quality and Integrity Working Group”.  These reports may be found at the URLs below:

| Working Group | Web address for Report | Addressed by CPUC Decision?
1. | Universal Node Identifier | http://162.15.5.2/wk-group/dai/uni/ | D.98-11-044
2. | Distribution Loss Factor | http://162.15.5.2/wk-group/dai/dlf/ | Pending
3. | Data Quality and Integrity Working Group | http://162.15.5.2/wk-group/dai/dqi/ | Pending

E.	Load Profiling (D.97-10-086 and D.98-12-065)

Status of Proceeding

D.98-12-065 ordered the Energy Division to conduct a workshop no later than June 30, 2000 to examine the use of load profiles, including whether the meter exemption for 20 to 50 kW direct access customers and for direct access customers with a demand of less than 20 kW should continue or be terminated, and whether hourly interval meters should be required of bundled customers with a demand of less than 50 kW

In D.97-05-040, the Commission allowed customers whose accounts have a maximum demand of less than 20 kW, to participate in direct access through statistical load profiling, and stated its intention to “reevaluate the use of statistical load profiles in the year 2000.”  Subsequently, the Commission issued D.98-12-065, which allowed customers with maximum demands between 20 kW and 50 kW to be exempt from the hourly interval meter requirement until March 31, 2002, and ordered the Energy Division to convene a workshop no later than June 30, 2000 to “examine the use of load profiles, whether the meter exemption for 20 to 50 kW direct access customers and for direct access customers with a demand of less than 20 kW should continue or be terminated, and whether hourly interval meters should be required of bundled customers with a demand of less than 50 kW.” (D.98-12-065, Ordering Paragraphs 1 and 2)

•	May 23, 2000	Administrative Law Judge ruling issued, inviting parties to submit comments by June 9, 2000 and reply comments by June 23, 2000 regarding the questions listed above.

•	6/29/2000	 ED will conduct a public workshop to address the questions noted above.

.
Historical documents related to the load profiling workshops that led to Commission Decisions 97-10-086 and 98-12-065 may be obtained at:
http://162.15.5.2/wk-group/dai/lp/

VII.	 FERC‑Related Issues
A.  Investor Owned Utilities
1. Settlement in Principle Announced in PG&E’s Fourth Transmission Owner Tariff case
On October 27, 1999, FERC issued an order accepting, suspending, and setting for hearing, PG&E’s fourth Transmission Owner Tariff case filed in the last two years.  Pacific Gas and Electric Company, 89 FERC ¶ 61,081 (1999), Docket No. ER99-4323-000.  On May 2, 2000, PG&E filed a motion with the presiding judge requesting a suspension of the procedural schedule, and announcing that the parties had reached a settlement in principle.  A full settlement package has been filed.  The settlement also resolves Pacific Gas and Electric Company, Docket No. ER00-2075-000, in which PG&E sought to recover from existing transmission contract customers transmission related charges which it might not be able to recover from retail and wholesale customers in the TO4 docket.
2. SDG&E Files Another Complaint against Public Service Company of New Mexico (“PNM”)
On March 23, 2000, in San Diego Gas & Electricy Company, Docket No. EL00-56-000,
SDG&E tendered for filing a complaint against PNM.  In the complaint, SDG&E states that the demand rate charged SDG&E by PNM under a long-term 100-megawatt system power sale is excessive, unjust, unreasonable, unduly discriminatory, and contrary to the public interest. SDG&E asks the FERC to initiate a proceeding under Section 206(b) of the Federal Power Act to investigate the rate and establish a refund effective date of May 22, 2000.  This is the latest in a string of SDG&E Complaints against PNM, and SDG&E has asked that the complaint be consolidated for hearing and decision with the proceeding in Docket Nos. EL97-54-002 and EL99-21-000.
3.  Testimony Filed in the Out-of Market Charges Docket
In Southern California Edison Company, (“Edison”) FERC Docket No. ER00-845-000; Pacific Gas & Electric Company, (“PG&E”) FERC Docket No. ER00-851-000; and San Diego Gas & Electric Company, (“SDG&E”) FERC Docket No. ER00-860-000, PG&E, Edison, and SDG&E, (referred to collectively as the Participating Transmission Owners (“PTOs”)), the PTOs have filed with FERC proposed mechanisms for recovering certain reliability-related costs that the ISO imposes on the PTOs in the wake of FERC’s partial approves Amendment 23 to the ISO’s Tariff.  The PTOs filed testimony on April 11, 2000.  Intervenor and Answering testimony was filed on May 26, 2000.
4.  SCE Proposes and FERC Approves Service Agreement for ARCO 
On March 16, 2000, Southern California Edison Company (“Edison”), tendered for filing in Southern California Edison Company, Docket No. ER00-1896-000 an unexecuted Service Agreement for Wholesale Distribution Service and an unexecuted Interconnection Facilities Agreement between Atlantic Richfield Company (“ARCO”) andEdison. These unexecuted Agreements specify the terms and conditions pursuant to which Edison will interconnect ARCO's generation to its electrical system and provide up to 34 MW of Distribution Service to ARCO.  On April 25, 2000, the FERC issued a letter order accepting the agreement for filing.
5.  FERC Approves Edison and CDWR Amendments to their Power Contract
On March 30, 2000, in Southern California Edison Company, Docket No. ER00-2043-000, SCE tendered for filing Amendment No. 6 to the Power Contract between Edison and the State Of California Department of Water Resources.  Amendment No. 6 amends the calculation of Edison’s return obligation to reflect divestiture of its Oil and Gas generating stations.  By letter order dated May 23, 2000, the FERC approved of the filing.  
6.  PG&E Files “Reliability Services” Tariff
On April 28, 2000, in Pacific Gas and Electric Company, Docket No. ER00-2360-000, PG&E filed to establish wholesale and retail rates for the recovery of reliability charges that the California Independent System Operator imposes on PG&E.  This filing contains a new mechanism for passing reliability-must-run (“RMR”) costs and out-of-market (“OOM”) costs through to transmission customers.  On May 16, 2000, the CPUC filed a Notice of Intervention and Comments in Support of PG&E’s filing.
B.  The ISO
1.  FERC Denies Requests for Rehearing of Order on Amendment No. 22
In California Independent System Operator Corporation, FERC Docket No. ER99-4545-000, FERC has approved Amendment No. 22 to the ISO Tariff.  On April 12, 2000, the FERC denied requests (including the CPUC’s) for rehearing. California Independent System Operator Corporation, 91 FERC ¶ 61,026 (2000); and California Independent System Operator Corporation 90 FERC ¶ 61,315 (2000).  The CPUC has since filed a notice of appeal.  Public Utilities Commission of the State of California v. FERC, D.C. Circuit Case No. 00-1203.
2.  FERC Approves Tariff Amendment No. 25
In its quarterly tariff filing, made January 27, 2000, the ISO has proposed a variety of changes to its tariff, including: (1) removal of restrictions on imports of Regulation service; (2) procedures for cancellation or rescheduling of planned transmission outage;   (3) delayed publication of individual bid data; (4) changes to the ISO Payments Calendar; (5) implementation of FTRs; (6) allocation of RMR costs in the event that the San Onofre Nuclear Generating Station (SONGS) is designated as an RMR unit; (7) procedures for information issued in the event of transmission derates between the day-ahead and hour-ahead markets.  The CPUC filed Comments in this docket, California Independent System Operator Corporation, FERC Docket No. ER00-1239-000, on February 17, 2000.  The CPUC supported the ISO proposal to publish bid data.  The CPUC also supported an equitable allocation of RMR costs, but cautioned against assuming that SONGS should become and RMR unit.  The CPUC took no position on the balance of Amendment No. 25. On March 29, 2000, the FERC conditionally accepted Amendment No. 25 for filing. California Independent System Operator Corporation, 90 FERC ¶ 61,316 (2000).
3.   The FERC Approves Tariff Amendment No. 26
The ISO on January 28, 2000 filed Tariff Amendment No. 26, in which the ISO proposes to change the timing of its issuance of dispatch notices to RMR units.  This ISO submittal, California Independent System Operator Corporation, FERC Docket No. ER00-1365-000, is generally referred to as the “pre-dispatch” filing.  The ISO sought authority to dispatch RMR units prior to the running of the California Power Exchange’s Day-Ahead market.  The CPUC on February 18, 2000 filed comments supporting the ISO’s proposal.  On March 31, 2000, the FERC accepted the Amendment for filing, as an interim measure pending completion of the congestion management reform stakeholder process. California Independent System Operator Corporation, 90 FERC ¶ 61,345 (2000).  

4.  FERC Sets the Transmission Access Charge (“TAC”) for Hearing
In an order issued May 31, 2000, the FERC has set the ISO’s TAC filing for hearing.  California Independent System Operator Corporation, 91 FERC ¶ 61,205 (2000).  The TAC filing establishes parameters for additional transmission owners to join the ISO.  The FERC has suspended the procedural schedule in the case, however, and has convened a settlement conference for June 9, 2000.  
5.  Two RMR Cases Settle; One Awaits a Preliminary Decision
Pacific Gas & Electric Company, Docket Nos. ER98-495-000, ER98-1614-000, ER98-2145, and ER99-3603-000 proceeded to hearing on March 20, 2000.  Hearing concluded on March 24, 2000.  The parties have filed their Initial and Reply Briefs, and now await a preliminary decision from Judge Young. 
San Diego Gas and Electric Company, Docket Nos. ER98-496-000 and ER98-2160 was set for hearing commencing on March 27, 2000, but settled prior to the hearing commencing.  The settlement has been filed at FERC, and the CPUC filed comments in support thereof. These dockets pertain to generating units owned by Duke Energy South Bay LLC.  The settlement has been certified to the FERC, and awaits FERC acceptance.
San Diego Gas and Electric Company, Docket Nos. ER98-496-006 and ER98-2160-004 proceeded to hearing on April 3, 2000, and settled prior to initial briefs being filed.  The settlement agreement in this case was filed on Friday, May 5, 2000.  These dockets pertain to generating units owned by Cabrillo Power I LLC and Cabrillo Power II LLC.

6.   RMR “Phase II” Case Settles
The Phase II Stipulation in Southern California Edison Company, Docket No. ER98-441-000, resolves a number of important issues that had previously been reserved for hearing in this proceeding.  This Agreement resolves all of the issues outstanding in the above-captioned Phase II proceeding, the related arbitration proceeding (Case No. 71 198 00295 99) pending before the American Arbitration Association (“AAA”) and the related court action (Case No. 301717) pending before the California Superior Court.  The FERC noticed the filing on May 11, 2000.   The CPUC filed comments in support of this settlement.
7.   The ISO Submits Three New Participating Load Agreements
On May 24, 2000, the ISO submitted for filing Participating Load Agreements for NewEnergy California, New West Energy, and Ancillary Service Coalition. California Independent System Operator Corporation et al., FERC Docket Nos. ER00-2581-000, ER00-2582-000, ER00-2583-000, respectively.  
8.  The ISO Files RMR Agreements with TANC
In California Independent System Operator Corporation, Docket No. ER00-2274-000, the ISO has submitted a settlement agreement among itself, PG&E, and the Northern California Power Agency (“NCPA”).  The agreement includes multiple RMR agreements, and resolves multiple billing disputes among the parties.  The CPUC filed comments in support of the ISO’s filing on May 15, 2000.
C.  The PX
1.	FERC Conditionally Accepts PX Expansion of Block-Forward Market to Include Ancillary Services
In California Power Exchange Corporation, FERC Docket No. ER00-1642-000, the PX seeks to establish forward and bilateral markets for ancillary services.  In addition, the PX seeks to allow participants with both load and generation to self-provide ancillary services.  The PX submitted its proposed filing on February 17, 2000.  Interventions and comments were due March 9, 2000, and the CPUC filed supporting comments.  On April 25, 2000, the FERC authorized the PX to begin trading of ancillary services products on May 1, 2000.  California Power Exchange Corporation, 91 FERC ¶ 61,079 (2000).
2.	FERC Approves PX Ancillary Services Market
In California Power Exchange Corporation, FERC Docket Nos. ER00-1641-000 and ER00-1642-000, the PX proposes tariff changes to create an ancillary services market.  Currently, the ISO operates the only market for ancillary services.  On April 25, 2000, the FERC authorized the PX to create an ancillary services forward market.  California Power Exchange Corporation, 91 FERC ¶ 61, 079 (2000).
3.	FERC Grants Rehearing In Part on PX Block Forward Market Application
In California Power Exchange Corporation, Docket No. ER00-951-000, the PX sought authority to expand its Block Forward Market.  The FERC partially accepted the PX’s application for filing, but required the PX to make filings under Section 205 of the Federal Power Act should the PX wish to make changes to its delivery points and times.  The PX sought rehearing in order to obtain authority to make these changes without FERC review.  On April 25, 2000, in California Power Exchange Corporation, 91 FERC ¶ 61,090 (2000), the FERC granted the PX’s request for rehearing, and reversed its previous order with respect to the scope of changes the PX could make without a FERC filing.
4.	The PX Seeks to Sell Daily and Balance-of-the-Month Forwards
In California Power Exchange Corporation, FERC Docket No. ER00-2386-000, the PX, on behalf of its CalPX Trading Services Division (“CTS”), tendered for filing proposed Amendment No. 3 to its CTS Rate Schedule FERC No. 1.  Amendment No. 3 is designed to allow CTS to implement two new services: (1) a daily block forward market and (2) a balance of the month market.  The CPUC on May 23, 2000 filed comments supporting the PX’s application.
D.	Miscellany
2.	Calpine Files for Market Rates for its new Plants
Calpine Files for Market Rates for its new Plants in Calpine Construction Finance Company, FERC Docket No. ER00-1115-000.  In its application, submitted January 14, 2000, Calpine Construction Finance Company (“CCFC”) states that it will build and initially operate a variety of new generation facilities nationwide, including the Sutter and Los Medanos (Pittsburg) projects in California, and the South Point project in Arizona (some sales from which are contemplated to be made into California).  The application seeks market-based rate authority for sales of energy and capacity in California and other relevant states.  The CPUC filed a non-substantive Notice of Intervention on February 3, 2000.
VIII.	  Public Purpose Programs
A.	Energy Efficiency and Demand Side Management 

On September 27, 1999, the utilities filed their compliance applications seeking approval of proposed program year (PY) 2000 and 2001 energy efficiency programs, budgets, performance incentive mechanisms, and market assessment and evaluation studies, as required by D.99-08-021.  Decision 99-12-053, issued on December 16, 1999, authorized the utilities to implement their proposed PY 2000 energy efficiency programs and budgets on an interim basis, subject to mid-year adjustment after further hearings.  D.99-12-053 deferred a determination regarding the utilities’ program-specific performance award mechanisms to the final decision.  Evidentiary hearings concluded February 2, 2000.  Closing briefs were submitted on February 29, 2000.  A proposed decision was mailed out May 8^th, and comments were received on May 30.  Reply comments will be filed on June 5, 2000.  The PD was scheduled for the June 8 agenda but has been held to the June 22, 2000 meeting.

B.	Low-income Programs 

On May 17, 1999, PG&E, on behalf of itself, Edison, SDG&E, and SoCal Gas, filed a joint proposal for standardizing the treatment of administrative costs for the CARE and LIEE programs.  Comments on the Joint Proposal were due June 30, 1999.  Responses were due July 12, 1999.  On June 1, 1999, LIGB submitted its recommendations on standardized utility reporting guidelines for the CARE and LIEE programs.  

Applications from the utilities to competitively bid out their program year 2000 LIEE programs were due July 1, 1999.  Hearings were held in November.  Opening briefs were due December 23, 1999 and reply briefs are due January 11, 2000.  Public participation hearings are scheduled for January 11 in Sacramento and January 13 in Los Angeles.  Supplemental opening briefs on the public participation hearings are due February 1, 2000.

Pursuant to the December 29, 1999 Assigned Commissioner’s Ruling; parties and LIGB Advisory Committee members are beginning a project to propose standardized Low Income Weatherization Installation Program & Policy Procedures Manuals and Weatherization Installation Standards Manuals.  The proposed standardized manuals and proposed policy revisions are due March 17, 2000.  These revisions would be effective for the program year 2001.

C.	Structure and Operating Procedures of LIGB and CBEE

Energy Division convened a workshop on April 12 and 13, 1999 to solicit input on the structure and operating procedures of the LIGB and the CBEE.  The draft Workshop Report was distributed for public comment on May 26, 1999.  Comments on the draft report were due June 11, 1999.  The final Workshop Report was filed on June 30, 1999.

On October 12, 1999, the proposed decision of Commissioner Neeper on the structure and operating procedures of the Boards was distributed for comment.  On December 20, 1999, 
An alternate of Commissioner Duque to abolish the Boards was distributed for comment.  On January 20, an alternate of Commissioner Lynch was distributed.  Commissioner :Lynch’s alternate would retain the LIGB while abolishing the CBEE.  These decisions are on the Commission’s agenda for February 3, 2000.
D.  California Board for Energy Efficiency 

For information on the Board’s current activities and background, see the CBEE website at http://www.cbee.org.
E.	 Low-Income Governing Board  (LIGB)

For information on the Board’s current activities and background, see the LIGB’s website at http://www.ligb.org

See the Commission’s Daily Calendar for CBEE and LIGB meeting dates and information at  http://www.cpuc.ca.gov/calendars/current/table_of_contents.htm
under Public Meetings and Workshops.
IX . 	CEQA Issues Related to Divestiture of Hydro and Fossil Generation

Hydro:
Regarding hydroelectric generation assets, PG&E and Edison have filed applications in 1999.  PG&E seeks to divest its entire hydroelectric system via an auction, while Edison has filed to retain its facilities.  The Energy Division issued a Notice of Preparation of an Environmental Impact Report (EIR) on PG&E’s application (April 28, 2000) and will conduct several public scoping meetings throughout northern and central California to obtain community and stakeholder input on environmental issues and concerns regarding the sale.  These meetings will be from May 8 through May 25.  The Energy Division’s EIR team will also be conducting technical consultations with state, local and federal agencies.   Written comments on the scope of the EIR and PG&E’s proposal are due by June 1, 2000.
Edison’s application requests retention of its hydroelectric assets.  The application is currently undergoing the initial stages of the CEQA review.  

Fossil: 
Environmental assessments of the sale of the utilities’ fossil-fuel plants under the California Environmental Quality Act (CEQA) were accomplished in 1997 and 1998 for Edison, PG&E, and SDG&E.  The Commission voted to adopt the CEQA documents for these plant sales and approved the results of the auctions in 1998 and 1999. 

In 1999, Edison filed an application (A. 99-10-023) to sell its majority ownership (56%) in the Mohave Generating Station.  The Commission released a Final Mitigated Negative Declaration which analyzes environmental impacts that could result from the sale.  The Commission is awaiting Edison to announce the winner of the auction.  Sierra Pacific Power Company also filed a divestiture application (1999) concerning its fossil-fuel plants located in Nevada.  This application is currently under review.

Recent Activity 
See http://www.cpuc.ca.gov/environ.html or 
http://www.cpuc.ca.gov/divisions/energy/environmental/info/aspen/pgehydro/pgehydro.htm 
or http://www.pgedivest.com/ or http://www.scedivest.com/ or http://www.sdgedivest.com for more information.
X.	Reliability 

Currently the staff are analyzing electric distribution system outage data, reporting on audits of utility record keeping (inspections and maintenance including tree trimming), working on undergrounding conversion OIR, and assisting the distributed generation OIR.  Work remaining from AB 1890 includes an interstate compact for reliability.

PG&E Distribution Reliability
•	Staff are implementing OP 12 of the GRC to conduct a financial audit and an engineering audit of PG&E's capital spending on gas and electric distribution projects during calendar 1999, with a report in time for the next PG&E GRC filing.  
Outage Reports
•	Determining whether each major electric utility has satisfied the reporting requirements of D.96-09-045 (SAIDI and related reliability indices).  Following up with requests for more data or information as needed.
Inspection/Maintenance Standards
•	Determining whether each major electric utility has satisfied the reporting requirements in GO 165.
•	Reporting on GO 165 audit of PG&E.
•	Implementing the compliance and reporting requirements of D.99-12-052 for municipal and publicly owned utilities subject to GO 165.
Emergency Standards
•	GO 166 Emergency Standards- D.00-05-022 adopted additional Standards 12 and 13 in a settlement, with no exceptions for transmission outages.
•	Requiring utility rotating outage plans to comply with standing decisions and emergency response plans to comply with GO 166.
•	Planning to merge Energy’s emergency reporting system with a similar accident notification system used by the Utility Safety Branch.  Considering a statewide (ISO, OES, CEC, utilities) beeper system for energy emergencies.
Undergrounding
•	Assessing in OIR 00-01-005 the existing programs to put overhead power and communication lines underground.  ED held 7 workshops this spring.  7 PPHs are underway; a staff report will follow, with a 2^nd PHC in August.
•	Staff working with the Department of Health Services (DHS) on EMF issues received utility data on cost and reliability of underground vs. overhead lines. 
Interstate Compact
•	Western Interconnection Coordination Forum is working on a proposal for unifying western electricity institutions under the North American Electricity Reliability Organization, to be finalized by December 2000.  CREPC, WSCC and the RTOs support a provision in proposed federal legislation that would authorize FERC to defer to reliability organizations and organizations of States, if they are interconnection-wide.

XI.	Consumer Education/Protection

The settlement approved by Decision (D.) 99-05-051 on issues related to SDG&E’s post-transition rate freeze/ratemaking applications required SDG&E to design and implement a communications plan to provide consumers with information about the post-transition competitive energy market. The communications plan includes bill inserts, print and radio advertisements, and brochures available through the Electric Education Call Center and SDG&E. The materials developed by SDG&E are subject to Commission review and approval. 

The utilities’ customer education program mandated by AB1890 and approved by the Commission in D.97-08-064 concluded on May 31, 1998. The Electric Education Call Center continues to serve residential and small business customers in 11 languages, with further language support available when necessary, providing customer service operators to answer questions and forward printed materials. Consumers may also access the consumer education website at www.knowledgeispower.org.

English/Consumers		800-253-0500
English/Businesses		800-789-0550
Spanish					800-365-0550
Chinese/Mandarin		800-940-3883
Chinese/Cantonese		800-957-8558
Vietnamese				800-474-5335	
Hmong					800-462-3749
Lao						800-442-2489	
Cambodian				800-465-6543
Japanese				800-210-7933
Tagalog					800-683-8448	
Korean					800-930-9559	
Thai						800-462-1244	
TDD						800-933-3119

The Electric Education Call Center is scheduled to terminate on December 31, 1999. (D.99-08-024)  In accordance with D.99-08-024, the Consumer Services Division filed a report on October 8, 1999 indicating that it can take over the functions of the Electric Education Call Center by November 1, 2000.

Knowledge is Power website   The Knowledge is Power website may be accessed at: http://www.knowledgeispower.org/.  The website is another resource for consumers to learn more about how the coming changes to the electric industry will affect their energy choices. Help topics provides answers to consumers’ frequently asked questions and invites consumers to e-mail questions for an e-mail response.  Links to the CPUC and the CEC website are also provided.

A.	The Commission’s Outreach Plan
The Commission’s own Outreach Plan builds upon the Commission’s unique resources and expertise to assist and educate consumers about the changes taking place in the electric industry.  

Throughout 1999, the Commission is participating in Town Hall meetings and briefings in legislative districts statewide. These activities are designed to assist legislators in providing their constituencies with information about electric industry restructuring. 
B.	The Electric Education Trust
D.97-08-064 directed the EET to work with community-based organizations to focus its educational efforts on customer groups and communities where understanding of the changes to the electric industry is low.  The Commission authorized a budget of $13 million to the EET. 
C.	Consumer Protection 

Pursuant to Senate Bill 477, the Commission adopted rules to protect consumers from unfair or abusive marketing practices by electric service providers (ESP).  Among other things, an ESP offering service to residential or small commercial customers must register with the Commission.  The Commission established interim standards for ESP registration in D. 98-03-072 and final standards in D. 99-05-034.  The number of ESPs with active registration status has remained fairly constant for some time between 30 and 35.  With the termination of the inactive status on July 1, 2000, the over 60 ESPs with inactive registration status shall either fulfill all registration requirements to achieve active status, request cancellation, or be permanently revoked.  Information for consumers and ESPs is available at the Electric Service Provider Link on the CPUC's web page.