Details for: 4463-E (Part 1 of 1).pdf


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Gary A. Stern, Ph.D.
Managing Director, State Regulatory Operations

April 7, 2021
ADVICE 4463-E
(U 338-E)
PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA
ENERGY DIVISION
SUBJECT:

New Standard Offer Contract Price Terms for Qualifying
Facilities 20 Megawatts or Less

PURPOSE
Pursuant to Ordering Paragraph (OP) 7 of the California Public Utilities Commission
(Commission) Decision 20-05-006 (Decision), Southern California Edison Company
(SCE) submits this advice letter to request approval for the attached prices articulated in
OPs 1-5 of the Decision.
BACKGROUND
On May 15, 2020, the Commission issued the Decision, which, among several
requirements, ordered the investor-owned utilities (IOUs) to create a new standard offer
contract of qualifying facilities (QFs) of 20 megawatts (MW) or less, with new price
terms. The Commission issued the Decision pursuant to the Order Instituting
Rulemaking (OIR) initiating the proceeding. The OIR, Rulemaking (R.)18-17-017,
addresses the history of the Commission’s implementation of the Public Utility
Regulatory Policies Act (PURPA). The Commission noted in the OIR that the
Rulemaking would consider adoption of a New QF standard offer contract (SOC) and
price terms as specified in the Federal Energy Regulatory Commission’s (FERC)
PURPA regulations 18 C.F.R. § 292.304(d)(2).
In the Decision, the Commission detailed the new Price Terms for the New QF SOC as
follows:

P.O. Box 800

8631 Rush Street

Rosemead, California 91770 (626) 302-9645 Fax (626) 302-6396





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ADVICE 4463-E (U 338-E) -2- April 7, 2021 1. An energy price determined at time of contract execution using a three-year average of publicly available California Independent System Operator (CAISO) locational marginal prices (LMPs), updated on a monthly basis. 2. A capacity price identified at the time of contract execution based on a five-year weighted average of publicly available resource adequacy (RA) prices, shaped based on generation capacity allocation factors as applied to time-of-use periods. 3. An energy price determined at time of delivery using hourly LMPs from the CAISO’s day-ahead market for the pricing node specific to the QF. 4. A capacity price at the time of delivery using the same methodology for capacity price at the time of execution, updated annually based on the CPUC’s RA Report. 5. A price for as-available energy that is not subject to a legally enforceable obligation based upon the hourly LMPs from the CAISO’s day-ahead market. Pursuant to these directives and OP 7, this advice letter provides the initial prices as applicable to the QF SOC for approval by the Commission. PRICES FOR THE PURPA SOC The following pricing components for SCE’s New QF SOC are provided in Appendix A of this advice letter: 1. The Net Qualifying Capacity (NQC) Prices for time of contract execution, which consists of the monthly and annual capacity prices, and the hourly capacity price payment tables. 2. The applicable CPUC approved QF Time-of-Delivery (TOD) periods for time of contract execution and for time of contract delivery. 3. The indicative Energy Price and price limits for time of contract execution for each time-of-delivery (TOD) period at the SP15 Energy Trading Hub. APPENDICES This advice letter contains appendices as listed below. Appendix A: New Standard Offer Contract for Qualifying Facilities of 20 MW or Less—Contract Price April 2021 TIER DESIGNATION Pursuant to the Decision, OP 7 SCE submits this advice letter with a Tier 1 designation.
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ADVICE 4463-E (U 338-E) -3- April 7, 2021 EFFECTIVE DATE This advice letter will become effective on April 7, 2021, the same date submitted. NOTICE Anyone wishing to protest this advice letter may do so by letter via U.S. Mail, facsimile, or electronically, any of which must be received by the Energy Division and SCE no later than 20 days after the date of this advice letter. Protests should be submitted to: CPUC, Energy Division Attention: Tariff Unit 505 Van Ness Avenue San Francisco, California 94102 E-mail: EDTariffUnit@cpuc.ca.gov Copies should also be mailed to the attention of the Director, Energy Division, Room 4004 (same address as above).In addition, protests and all other correspondence regarding this advice letter should also be sent by letter and transmitted via facsimile or electronically to the attention of: Gary A. Stern, Ph.D. Managing Director, State Regulatory Operations Southern California Edison Company 8631 Rush Street Rosemead, California 91770 Facsimile: (626) 302-6396 Telephone: (626) 302-9645 E-mail: AdviceTariffManager@sce.com Tara S. Kaushik Managing Director, Regulatory Relations c/o Karyn Gansecki Southern California Edison Company 601 Van Ness Avenue, Suite 2030 San Francisco, California 94102 Facsimile: (415) 929-5544 E-mail: Karyn.Gansecki@sce.com
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ADVICE 4463-E (U 338-E) -4- April 7, 2021 With a copy to: Eric B. Sezgen Attorney Southern California Edison Company 2244 Walnut Grove Avenue, 3rd Floor Rosemead, California 91770 Phone: (626) 302-1054 E-mail: Eric.Sezgen@sce.com There are no restrictions on who may submit a protest, but the protest shall set forth specifically the grounds upon which it is based and must be received by the deadline shown above. In accordance with General Rule 4 of GO 96-B, SCE is furnishing copies of this advice letter to the interested parties shown on the attached A.16-11-005, R.18-07-003, R.18-07-017, and GO 96-B service lists. Address change requests to the GO 96-B service list should be directed to AdviceTariffManager@sce.com or at (626) 302-3719. For changes to any other service list, please contact the Commission’s Process Office at (415) 703-2021 or at Process_Office@cpuc.ca.gov. Further, in accordance with Public Utilities Code Section 491, notice to the public is hereby given by submitting and keeping the advice letter at SCE’s corporate headquarters. To view other SCE advice letters submitted with the Commission, log on to SCE’s website at https://www.sce.com/wps/portal/home/regulatory/advice-letters. All questions concerning this advice letter should be directed to Raffi Minasian at (626) 302-8905 or by electronic mail at Raffi.Minasian@sce.com. Southern California Edison Company /s/ Gary A. Stern Gary A. Stern, Ph.D. GAS:es/rf:cm Enclosures
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ADVICE LETTER SUMMARY ENERGY UTILITY MUST BE COMPLETED BY UTILITY (Attach additional pages as needed) Company name/CPUC Utility No.: Southern California Edison Company (U 338-E) Utility type: ELC GAS PLC HEAT ELC = Electric PLC = Pipeline WATER Contact Person: Darrah Morgan Phone #: (626) 302-2086 E-mail: AdviceTariffManager@sce.com E-mail Disposition Notice to: AdviceTariffManager@sce.com EXPLANATION OF UTILITY TYPE GAS = Gas WATER = Water HEAT = Heat (Date Submitted / Received Stamp by CPUC) Tier Designation: 1 Advice Letter (AL) #: 4463-E Subject of AL: New Standard Offer Contract Price Terms for Qualifying Facilities 20 Megawatts or Less Keywords (choose from CPUC listing): Compliance AL Type: Monthly Quarterly Annual One-Time Other: If AL submitted in compliance with a Commission order, indicate relevant Decision/Resolution #: Decision 20-05-006 Does AL replace a withdrawn or rejected AL? If so, identify the prior AL: Summarize differences between the AL and the prior withdrawn or rejected AL: Confidential treatment requested? Yes No If yes, specification of confidential information: Confidential information will be made available to appropriate parties who execute a nondisclosure agreement. Name and contact information to request nondisclosure agreement/ access to confidential information: Resolution required? Yes No Requested effective date: 4/7/21 No. of tariff sheets: -0- Estimated system annual revenue effect (%): Estimated system average rate effect (%): When rates are affected by AL, include attachment in AL showing average rate effects on customer classes (residential, small commercial, large C/I, agricultural, lighting). Tariff schedules affected: None Service affected and changes proposed1: Pending advice letters that revise the same tariff sheets: None 1 Discuss in AL if more space is needed. Clear Form
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Protests and all other correspondence regarding this AL are due no later than 20 days after the date of this submittal, unless otherwise authorized by the Commission, and shall be sent to: CPUC, Energy Division Attention: Tariff Unit 505 Van Ness Avenue San Francisco, CA 94102 Email: EDTariffUnit@cpuc.ca.gov Name: Gary A. Stern, Ph.D. Title: Managing Director, State Regulatory Operations Utility Name: Southern California Edison Company Address: 8631 Rush Street City: Rosemead Zip: 91770 State: California Telephone (xxx) xxx-xxxx: (626) 302-9645 Facsimile (xxx) xxx-xxxx: (626) 302-6396 Email: advicetariffmanager@sce.com Name: Tara S. Kaushik c/o Karyn Gansecki Title: Managing Director, Regulatory Relations Utility Name: Southern California Edison Company Address: 601 Van Ness Avenue, Suite 2030 City: San Francisco State: California Zip: 94102 Telephone (xxx) xxx-xxxx: Facsimile (xxx) xxx-xxxx: (415) 929-5544 Email: karyn.gansecki@sce.com Clear Form
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ENERGY Advice Letter Keywords Affiliate Direct Access Preliminary Statement Agreements Disconnect Service Procurement Agriculture ECAC / Energy Cost Adjustment Qualifying Facility Avoided Cost EOR / Enhanced Oil Recovery Rebates Balancing Account Energy Charge Refunds Baseline Energy Efficiency Reliability Bilingual Establish Service Re-MAT/Bio-MAT Billings Expand Service Area Revenue Allocation Bioenergy Forms Rule 21 Brokerage Fees Franchise Fee / User Tax Rules CARE G.O. 131-D Section 851 CPUC Reimbursement Fee GRC / General Rate Case Self Generation Capacity Hazardous Waste Service Area Map Cogeneration Increase Rates Service Outage Compliance Interruptible Service Solar Conditions of Service Interutility Transportation Standby Service Connection LIEE / Low-Income Energy Efficiency Storage Conservation LIRA / Low-Income Ratepayer Assistance Street Lights Consolidate Tariffs Late Payment Charge Surcharges Contracts Line Extensions Tariffs Core Memorandum Account Taxes Credit Metered Energy Efficiency Text Changes Curtailable Service Metering Transformer Customer Charge Customer Owned Generation Mobile Home Parks Name Change Transition Cost Transmission Lines Decrease Rates Non-Core Transportation Electrification Demand Charge Non-firm Service Contracts Transportation Rates Demand Side Fund Nuclear Undergrounding Demand Side Management Oil Pipelines Voltage Discount Demand Side Response PBR / Performance Based Ratemaking Wind Power Deposits Portfolio Withdrawal of Service Depreciation Power Lines Clear Form
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APPENDIX A NEW STANDARD OFFER CONTRACT FOR QUALIFYING FACILITIES (QF) OF 20 MW OR LESS (D.20-05-006) CONTRACT PRICES - APRIL 2021 1 Prices for Time of Execution Contracts (“As-Executed Option”) 1. Table 1 - The Capacity Price identified at time of execution for contracts using the “AsExecuted Option” under the New QF SOC would be as provided below for a contract executed in this month. These values correspond to the table in Section 3(c) of Exhibit D for the As-Executed Option of the New QF SOC. Term Year 1 2 3 4 5 6 7 8 9 10 11 12 Monthly RA Capacity Price ($/kW-month)2 $3.26 $3.26 $3.26 $3.34 $3.43 $3.51 $3.60 $3.69 $3.78 $3.88 $3.97 $4.07 Annual RA Capacity Price ($/kW-year) $39.12 $39.12 $39.12 $40.10 $41.10 $42.13 $43.18 $44.26 $45.37 $46.50 $47.66 $48.86 Annual Price Escalation Factor3 1.000 1.000 1.000 1.025 1.051 1.077 1.104 1.131 1.160 1.189 1.218 1.249 Table 2 - The Hourly Capacity Prices for contracts using the As-Executed Option for the New QF SOC, based on Term Year 1 values in Table 1 above, CPUC approved allocation factors and time of delivery (TOD) periods would be as provided below for contracts executed in this month. These values correspond to the table in Section 3(b) of Appendix D for the As-Executed Option and will be multiplied by the Annual Price Escalation Factor shown in Table 1 for each applicable Term Year. 1 All contract prices herein are only applicable to contracts executed under the form of contract specified under D.20-05-006 and approved by the CPUC. 2 2019 Resource Adequacy Report, weighted average price in dollars per kilowatt-month on page 24, Table 7: Aggregated RA Contract Prices, 20. http://www.cpuc.ca.gov/ra/ 3 This multiplication factor implements the 2.5% escalation for each year of the contract term pursuant to ordering paragraph 2 of D.20-05-006. - 1-
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Month Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 1 - On-Peak ($/MWh) NA NA NA NA NA $65.21 $65.21 $65.21 $65.21 NA NA NA 2 - Mid-Peak ($/MWh) $4.58 $4.58 $4.58 $4.58 $4.58 $26.95 $26.95 $26.95 $26.95 $4.58 $4.58 $4.58 3 - Off-Peak ($/MWh) $0.13 $0.13 $0.13 $0.13 $0.13 $0.04 $0.04 $0.04 $0.04 $0.13 $0.13 $0.13 4 - Super-OffPeak ($/MWh) $0.11 $0.11 $0.11 $0.11 $0.11 NA NA NA NA $0.11 $0.11 $0.11 2. Table 3 - The applicable CPUC approved Time-of-Delivery (TOD)4 periods for a contract executed this month under the New QF SOC would be as follows. These values correspond to the table in Section 2(a) of Appendix D for the As-Executed Option. The TOD periods are intended to apply to both the energy and capacity pricing of the New QF SOC. Despite the reference source of these TOD periods, they are meant to only apply to the New QF SOC and are subject to change from time-to-time via a Tier 2 advice letter to the CPUC, and will not modify the time periods used in other proceedings, including those used in existing Short Run Avoided Cost contracts. TOD Period 1 – On-Peak 2 – Mid-Peak 3 – Off-Peak 4 – Super-Off Peak Weekdays 6 Summer Winter (Jun – Sep) (Oct – May) 4 pm – 9 pm N/A N/A 4 pm – 9 pm All hours except 9 pm – 8 am 4 pm – 9 pm N/A 8 am – 4 pm Weekends & Holidays5 Summer Winter (Jun – Sep) (Oct – May) N/A N/A 4 pm – 9 pm 4 pm – 9 pm All hours except 9 pm – 8 am 4 pm – 9 pm N/A 8 am – 4 pm 3. Table 4 - The Contract TOD Energy Price ($/MWh) for a contract executed this month using the As-Executed Option under the New QF SOC will be calculated using the three-year average of the CAISO locational marginal prices (LMP) for the pricing node specific to the qualifying facility. The monthly energy prices, for each time-of-delivery (TOD) period, will be limited by a 10% collar based on the three-year average prices at the SP15 Energy Trading Hub as shown below. These calculated values will be inserted into Section 2(b) of Appendix D for the As-Executed Option. 4 D.18-07-006 (SCE’s 2016 Rate Design Window Application (July 12, 2018)) 5 Holidays are New Year’s Day (January 1), President’s Day (third Monday in February), Memorial Day (last Monday in May), Independence Day (July 4), Labor Day (first Monday in September), Veterans Day (November 11), Thanksgiving Day (fourth Thursday in November), and Christmas Day (December 25). When any holiday falls on a Sunday, the following Monday will be recognized as an off-peak period. No change will be made for holidays falling on a Saturday. 6 The Summer Season commences at 12:00 a.m. on June 1 and continue until 12:00 a.m. on October 1 of each year. - 2-
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Month 1 On-Peak ($/MWh) 2 Mid-Peak ($/MWh) -10% 3 Off-Peak ($/MWh) +10% +10% SP15 -10% SP15 -10% 4 Super-Off-Peak ($/MWh) +10% SP15 +10% SP15 -10% Jan N/A N/A N/A $51.60 $46.91 $42.22 $38.25 $34.77 $31.29 $28.35 $25.77 $23.19 Feb N/A N/A N/A $92.30 $83.91 $75.52 $63.77 $57.97 $52.17 $31.00 $28.18 $25.36 Mar N/A N/A N/A $45.88 $41.71 $37.54 $38.93 $35.39 $31.85 $18.46 $16.78 $15.10 Apr N/A N/A N/A $37.06 $33.69 $30.32 $28.72 $26.11 $23.50 $10.98 $9.98 $8.98 May N/A N/A N/A $33.77 $30.70 $27.63 $23.62 $21.47 $19.32 $9.49 $8.63 $7.77 Jun $45.50 $41.36 $37.22 $34.51 $31.37 $28.23 $22.91 $20.83 $18.75 N/A N/A N/A Jul $101.59 $92.35 $83.12 $66.33 $60.30 $54.27 $38.46 $34.96 $31.46 N/A N/A N/A Aug $162.78 $147.98 $133.18 $92.49 $84.08 $75.67 $45.73 $41.57 $37.41 N/A N/A N/A N/A N/A N/A Sep $70.39 $63.99 Oct N/A N/A N/A $68.85 $62.59 $56.33 $40.71 $37.01 $33.31 $28.00 $25.45 $22.91 Nov N/A N/A N/A $71.17 $64.70 $58.23 $46.40 $42.18 $37.96 $35.12 $31.93 $28.74 Dec N/A N/A N/A $67.77 $61.61 $55.45 $47.25 $42.95 $38.66 $37.73 $34.30 $30.87 $57.59 $78.83 $71.66 $64.49 $34.29 $31.17 $28.05 Prices for Time of Delivery Contracts (“As-Delivered Option”) 4. For purposes of determining the RA Capacity Price at the time of delivery for contracts using the As-Delivered Option under the New QF SOC, the Hourly Capacity Prices set forth in Table 2 above would apply for deliveries during this month. This is described in Section 3(a) of Exhibit D for the As-Delivered Option. For purposes of determining the Monthly RA Capacity Price (MRACP) as defined in Section 3(b) of Exhibit D, at the time of delivery for contracts using the As-Delivered Option, the Monthly Capacity Price in Table 1 above for Term Year 1 would apply for deliveries during this month. For clarity, there will be no Annual Price Escalation Factor applied to these values. The Hourly Capacity Prices and the Monthly RA Capacity Price will be recalculated annually based on changes in the cost of resource adequacy and/or capacity allocation factors, and time-of-use factors. 5. The Energy Price for contracts using the As-Delivered Option under the New QF SOC will be the locational marginal prices from the California Independent System Operator’s dayahead market for the pricing node specific to the qualifying facility. This is described in Section 2 of Exhibit D for the As-Delivered Option. - 3-
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