CPUC Public Agenda 3275Thursday, June 9, 2011, 9:00 a.m.505 Van Ness Ave, San Francisco

Commissioners: Michael R. Peevey

Timothy Alan Simon Michel Peter Florio

Catherine J.K. SandovalMark J. Ferron

www.cpuc.ca.gov

Public Comment• Per Resolution ALJ-252, any member of the public who wishes to address the CPUC about matters before the Commission must either sign up at the Commission's webpage section "Public Comment Sign-Up" or with the Public Advisor before the meeting begins.

• Public speakers must visit the Public Advisors table before the start of the meeting on the day of the Commission Meeting to ask our staff to mark their presence.

• Once called, each speaker has up to 3 minutes at the discretion of the Commission President, depending on the number of speakers.

• A sign will be posted when 1 minute remains.

• A bell will ring when time has expired.

•Those who sign up after 9:00 a.m. will only have 1 minute.

The following items are NOT subject to Public Comment:Item: 6All items on the Closed Session Agenda

Public Comment• Per Resolution ALJ-252, any member of the public who wishes to address the CPUC about matters before the Commission must either sign up at the Commission's webpage section "Public Comment Sign-Up" or with the Public Advisor before the meeting begins.

• Public speakers must visit the Public Advisors table before the start of the meeting on the day of the Commission Meeting to ask our staff to mark their presence.

• Once called, each speaker has up to 2 minutes to address the Commission.

• A sign will be posted when 1 minute remains.

• A bell will ring when time has expired.

•Those who sign up after 9:00 a.m. will only have 1 minute.

The following items are NOT subject to Public Comment:Item: 6All items on the Closed Session Agenda

Public Comment• Per Resolution ALJ-252, any member of the public who wishes to address the CPUC about matters before the Commission must either sign up at the Commission's webpage section "Public Comment Sign-Up" or with the Public Advisor before the meeting begins.

• Public speakers must visit the Public Advisors table before the start of the meeting on the day of the Commission Meeting to ask our staff to mark their presence.

• Once called, each speaker has up to 1 minute to address the Commission.

• A bell will ring when time has expired.

•The following items are NOT subject to Public Comment:Item: 6All items on the Closed Session Agenda

Agenda Changes• Items shown on the Consent Agenda will be taken up and voted on as a group in one of the first items of business of each CPUC meeting.

• Items on Today’s Consent Agenda are: 1, 2, 3, 4, 5, 6, 8, 9, 10, 12, 13, 14, 15, 16, 17, 19, 20, 21 & 23

• Any Commissioner, with consent of the other Commissioners, may request an item from the Regular Agenda be moved to the Consent Agenda prior to the meeting.Items: 29, 33, 35, 39 & 40 from the Regular Agenda have been added to the Consent Agenda.

• Any Commissioner may request an item be removed from the Consent Agenda for discussion on the Regular Agenda prior to the meeting. Item: None have been moved to the Regular Agenda.

• Item: 37 has been withdrawn.

• The following items have been held to future Commission Meetings:

Held to 6/23/11: 7, 11, 18, 22, 25, 26, 27, 30, 34, 36 & 38

Regular Agenda

• Each item on the Regular Agenda (and its alternate if any) will be introduced by the assigned Commissioner or CPUC staff and discussed before it is moved for a vote.

• For each agenda item, a summary of the proposed action is included on the agenda; the CPUC’s decision may, however, differ from that proposed.

• The complete text of every Proposed Decision or Draft Resolution is available for download on the CPUC’s website: www.cpuc.ca.gov.

• Late changes to agenda items are available on the Escutia Table.

Regular Agenda – Energy OrdersItem #24 [9932] Net Surplus Compensation Rate for Electric Utilities

A10-03-001, A10-03-010, A10-03-012, A10-03-013, A10-03-017 - Related matters.In the matter of the Application of PacifiCorp for approval to implement a Net Surplus Compensation Rate.

Ratesetting Comr. Peevey/ ALJ Duda----------------------------------------------------------------------------------------------------------------------------------------------------

PROPOSED OUTCOME:

• Adopts a Net Surplus Compensation Rate (NSC) for net energy metering customers who produce excess power over a 12-month period, pursuant to Assembly Bill 920.

• Adopts an avoided cost based NSC rate for each electric utility based on an average of day-ahead “default load aggregation point” electricity prices for the 12-month period.

• Finds that net surplus generators should be compensated for the renewable attributes of their net surplus generation if and when they produce renewable energy credits in compliance with Renewable Portfolio Standard eligibility, metering and tracking requirements, but declines to adopt a value for renewable attributes at this time.

• Requires Pacific Gas and Electric Company, Southern California Edison Company, San Diego Gas & Electric Company, Sierra Pacific Power Company, and PacifiCorp to each file a compliance advice letter to set their actual NSC rates.

• Closes the proceeding.

ESTIMATED COST:

• Assuming a NSC rate of $.05/kilowatt hour (based on 2009 average) and annual net surplus generation for Pacific

Gas and Electric Company, Southern California Edison Company, and San Diego Gas & Electric Company of 12 million kilowatt hours, total net surplus compensation would equal $600,000.

Regular Agenda – Energy OrdersItem #24a [10297] ALTERNATE TO ITEM 9932

Comr. Peevey-----------------------------------------------------------------------------------------------------------------------------PROPOSED OUTCOME:

• Adopts a Net Surplus Compensation (NSC) Rate for net energy metering customers who produce excess power over a 12-month period, pursuant to Assembly Bill 920. The NSC rate is calculated using the variable component of the Market Price Referent (MPR), adjusted for time of delivery factors.

• Finds that net surplus generation should count toward the utilities’ Renewable Portfolio Standard (RPS) targets. However, net surplus generation is not exempt from RPS certification, metering, and tracking requirements and will not count toward the utilities’ RPS targets until the CEC finalizes a process for certifying net surplus generation facilities and tracking their output.

• Specifies that the NSC rate includes a value for renewable attributes of the generation. Nevertheless, until the California Energy Commission (CEC) finalizes a process for certifying net surplus generation facilities and tracking their output, Net surplus generators will be compensated at an “energy-only rate,” calculated as the difference between the time of delivery adjusted MPR and a renewable energy premium published by the Department of Energy (currently 1.83 cents/kWh). All net surplus generation will receive the “energy-only” rate until the CEC finalizes the Renewable Energy Credit REC certification and tracking process described above. This “energy only rate” is 7.58 cents/kWh for Pacific Gas and Electric Company (PG&E), 8.03 cents/kWh for Southern California Edison Company (SCE), and 6.54 cents/kWh for San Diego Gas & Electric Company (SDG&E).

• Requires PG&E, SCE, SDG&E, Sierra Pacific Power Company, and PacifiCorp to each file a compliance advice letter to set their actual NSC rates.

• Closes the proceeding.

ESTIMATED COST:

Assuming a full bundled Net Surplus Compensation rate in the range of $.08 to $.10 per kilowatthour and annual net surplus

generation for PG&E, SCE, and SDG&E of 12 million kWh, total net surplus compensation would range from $960,000 to

$1.2 million annually.

Regular Agenda – Energy OrdersItem #28 [10401] Determining Maximum Allowable Operating Pressure Methodology and Requiring Filing of Natural Gas Transmission Pipeline Replacement or Testing Implementation Plans

R11-02-019 Order Instituting Rulemaking on the Commission’s Own Motion to Adopt New Safety and Reliability Regulations for Natural Gas Transmission and Distribution Pipelines and Related Ratemaking Mechanisms

Ratesetting Comr. Florio/ ALJ Bushey-------------------------------------------------------------------------------------------------------

PROPOSED OUTCOME:

• Directs gas transmission line operators to complete on-going maximum allowable operating pressure calculations and to prepare a plan to pressure test or replace all natural gas pipeline not so tested.

ESTIMATED COST:

• Unknown.

Regular Agenda – Communication OrdersItem #31 [10449] New Order Instituting Investigation - Option A and Option B

I.__________ Order Instituting Investigation on the Commission's Own Motion Into the Proposed Purchase and Acquisition by AT&T Inc. of T-Mobile USA, Inc., and its Effect on California Ratepayers and the California Economy.------------------------------------------------------------------------------------------------------

PROPOSED OUTCOME:

• Fact-finding Order Instituting Investigation (OII) into the proposed acquisition by AT&T Inc., the parent and/or beneficial owner of California telecommunications utilities Pacific Bell dba AT&T California and New Cingular Wireless PCS, LLC, of all the issued and outstanding shares of capital stock of T-Mobile USA, Inc., which is the direct and/or beneficial owner of California telecommunications utility T-Mobile West Corporation.

• This OII will investigate, gather and analyze information relevant to the proposed merger to determine whether the merger meets the requirements of applicable law and whether additional Commission action is warranted.

ESTIMATED COST:

• Unknown.

Regular Agenda – Communication Resolutions and Reports

Item #32 [10127] Verizon California Inc. to Change the Way They Provide Residential White Pages Directory Listings

Res T-17302, Advice Letter No 12535 filed October 22, 2010 - Related matters.------------------------------------------------------------------------------------

PROPOSED OUTCOME:

• Approves Verizon California Inc.’s request to discontinue automatic delivery of residential white pages telephone directories.

ESTIMATED COST:

• None.

Regular Agenda – Communication Resolutions and Reports

Item #32a [10382] ALTERNATE TO ITEM 10127-------------------------------------------------------------------------------------

PROPOSED OUTCOME:

• Rejects Verizon California Inc.’s request to discontinue automatic delivery of residential white pages telephone directories.

• Directs that the issue of whether white pages residential telephone directories should be included in the definition of "Basic Service," and if so how such directories should be provided, be considered in Rulemaking 09-06-019.

ESTIMATED COST:

• None.

Resolution T-17302 and Resolution T-17302A

Jack Leutza Director, Communications Division

California Public Utilities Commission

June 9, 2011

Option One: Resolution T-17302

Approves Verizon’s request to change the way it delivers white pages directories to customers

• would affect residential white pages only

• residential white pages would no longer be delivered automatically—customers would have to request them

• other directories would be delivered automatically — white page business and government listings, consumer guides, and yellow pages

• customers would have to request delivery once—delivery would continue until the customer opts out

Verizon will provide a toll-free number to request a directory or CD-ROM

- automated system (available 24/7) - live operator (available 8-6:30 EST, M-F)

Verizon will provide an online directory

Verizon would give customers notice of the change in - its national website

- a press release - a separate sheet on top of directories - bill messages - product guide and annual notice

Verizon would report the following data:

Directory Assistance Calls

--the number of directory assistance calls

--quarterly

--for the year prior to the change and for two years

after the change

Directory Requests

--the number of printed directory requests

--for one year after the change

Option Two:Resolution T-17302A

Finds that Verizon’s Advice Letter raises industry-wide issues

Rejects Verizon’s proposal and directs that the issues be considered as part of the revisions in the

requirements of “basic telephone service” being considered in R.09-06-019

Regular Agenda – Communication Resolutions and Reports

Item #32 [10127] Verizon California Inc. to Change the Way They Provide Residential White Pages Directory Listings

Res T-17302, Advice Letter No 12535 filed October 22, 2010 - Related matters.------------------------------------------------------------------------------------

PROPOSED OUTCOME:

• Approves Verizon California Inc.’s request to discontinue automatic delivery of residential white pages telephone directories.

ESTIMATED COST:

• None.

Regular Agenda – Communication Resolutions and Reports

Item #32a [10382] ALTERNATE TO ITEM 10127-------------------------------------------------------------------------------------

PROPOSED OUTCOME:

• Rejects Verizon California Inc.’s request to discontinue automatic delivery of residential white pages telephone directories.

• Directs that the issue of whether white pages residential telephone directories should be included in the definition of "Basic Service," and if so how such directories should be provided, be considered in Rulemaking 09-06-019.

ESTIMATED COST:

• None.

Commissioners’ Reports

Management Reports

Regular Agenda – Management Reports and Resolutions

Item #41 [10428] Report and Discussion by Consumer Protection and Safety Division on Recent Safety Program Activities -------------------------------------------------------------------------

24

CPSD Utilities Safety and Reliability Branch

Raymond Fugere, Program and Project Supervisor

California Public Utilities Commission

June 9, 2011

Presentation Overview

• Definition of Reportable Incidents

• Basics of Incident Investigations

• Types of Underground Equipment

• Underground Explosion Investigation Procedures

• Utility and USRB Actions

Incident Reporting Requirements

Within 2 hours of a reportable incident during normal working hours or within 4 hours of a reportable incident outside of normal working hours, the utility shall provide notice to designated CPUC staff of the general nature of the incident, its cause and estimated damage

Basis of Investigations• Compliance with Commission General Orders

128 and 165• Compliance with the Public Utilities Code• Failure to follow acceptable industry standards• Failure to follow company’s procedure/policy• Failure to follow other agencies safety

requirement

Type of Underground Structures

• Underground Vaults• BURD (Buried Underground Residential

Distribution)• Padmounted Structures• Handholes• Manholes• Walk-in Vaults• Above Ground Enclosures

Underground Equipment• Cover• Ladder• Transformers• Switches (oil or gas)• Conductors• Ground Rods• Racks• Capacitors• Breakers• Fuses• Blowers• Sump Pumps• Elbows• Light Fixtures• Other Hardware

Typical Underground Vault

Typical Handhole

BURD Structures

Typical Pamounted Structures

Investigation of Underground Electric Facilities Failures and Explosions

Underground Explosion Investigation Procedure

Field Work• Immediate contact with the

utility• Meet with the utility

representative at the site • Interview Utility’s

personnel• Interview witnesses who

observed the incident • Take pictures of the site

and facilities (equipment, conductors,…)

• Examine evidence (transformers, conductors, switches,…)

Office Work• Review and analyze

construction and maintenance records

• Review and analyze inspection records

• Review the utility’s response to the incident

• Generate data requests as necessary

• Arrange to interviews of utility’s personnel as needed (including the utility’s employees who actually did the last inspection)

Utilities Actions To Prevent Transformer Explosions

• Conduct inspections pursuant to General Order 165– Visual Inspections– Thermal Inspections

• Examine trends of outages

• Prioritize replacement of equipment

USRB Actions

UtilityStandards

Regulation

MonitoringCriteria

Monitoring

Local Fixes

Utility / IndustryReview

ReformsNeeded

Industry / Nation

Standards

Regular Agenda – Management Reports and Resolutions

Item #41 [10428] Report and Discussion by Consumer Protection and Safety Division on Recent Safety Program Activities -------------------------------------------------------------------------

Management Reports

The CPUC Thanks YouFor Attending Today’s Meeting

The Public Meeting is adjourned.

The next Public Meeting will be:

June 23, 2011, at 9:00 a.m.