A.07-07-015Proposed Decision DRA’s comments

PG&E and SDG&E applications for Approval of their Separate

Emerging Renewable Resource Programs (ERRP)

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Proposed Decision Summary

• ERRP establishes funding for research on emerging renewable technologies that fit the renewable resource needs of each investor-owned utility (IOUs).

• Authorizes PG&E to spend up to $30 million over a two year period.• Authorizes SDG&E to spend up to $15 million over a two year period.• Maximum funding of $7 million per project. • Ratepayers to fund up to 80% of each ERRP project; remaining funds to come from

outside sources.• Requires renewable technology assessment report to identify technologies that fit

the renewable resource needs of each IOU.• Provides for an Independent evaluator (IE) hired by ED to review ERRP project

solicitations.• Sets up a Technical Review Process (TRP) to review emerging renewable

technology.• Requires projects to be approved through the TRP (in consultation with ED).• Rejects Emerging Renewable Resources Coordinating Council (ERRCC).• Requires a workshop to address outstanding issues within 90 days of the final

decision.

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Matrix of Issues and Positions

Issue SDG&E / PG&E DRA PD DRA’s COMMENTS

ERRCC Utilities informed ERRCC about selected projects

ERRCC approval prior to project’s approval

Rejects ERRCC. Established TRP

DRA supports PD.

Funding 100% ratepayers funding

33% funding from other sources / venture capital (VC) based on gain on sale D.06-12-043

20% other sources, VC or third parties funding

DRA Supports PD as a reasonable compromise.

Approval process Tier 1 advice letter (AL) process

Submit all projects to ERRCC for approval

Review process involving technical experts with ED oversight

Strengthens the ERRP and makes it more accountable to ratepayers; DRA Supports PD.

Intellectual Property (IP)

Proprietary Public availability of ratepayers’ funded IP

Workshop DRA would like to have a workshop addressing implementations.

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Issues

• DRA has concerns about the litany of ratepayer funded research and development programs that are being created under one clean energy guise or another that are increasing the cost of electricity and are not well coordinated.

• SDG&E / PG&E application is identical to California Institute for Climate Solutions (CICS).

Both programs purportedly to enhance renewable R&D.How to avoid duplication of other renewable programs.Additional cost burden on ratepayers.

• Need to develop a comprehensive Research, Development and Demonstration (RD&D) process or program for all utilities.

• Need to maintain stronger oversight on research expenditures until overall Commission policy direction is clarified.

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Recommendations

• IOUs should identify the gaps in the CEC’s PIER program and recommend modifications and solutions rather than initiate their own ad hoc RD&D.

• To avoid duplication of projects with California Institute for Climate Solutions (CICS), ERRP should be terminated once the CICS becomes operational.

• Commission should adopt the PD’s measures to ensure funds are managed efficiently and effectively and increase accountability.