California Public Utilities Commission Votes to Allow Utilities to Increase Capacities in Spite of Continuing Environmental Concerns (R.20-11-003)


By Tristam Stidham

At its March 25, 2021 meeting (agenda item 10), the California Public Utilities Commission (CPUC), unanimously voted to direct California’s three major Investor Owned Utilities (IOUs), San Diego Gas & Electric, Pacific Gas & Electric, and Southern California Edison, to increase their energy storage capacities and adopt measures to decrease demand during dangerous periods. These periods would include extreme weather events such as California’s August 2020 heatwave. The decision (D.21-03-056) directs the utilities to increase their Planning Reserve Margins (PRM) from 15% to 17.5% and amends parts of a previously proposed decision of Administrative Law Judge Bryan L. Stevens.

The plan was adopted in order to avoid the blackouts or Public Safety Power Shutoffs (PSPS), which ensued during August 2020’s heatwave. The CPUC issued the initial Order Instituting Rulemaking (R.20-11-003) on November 20, 2020, in response to the August 2020 rolling blackouts and PSPS events.

At the March 25, 2001 meeting, the Commissioners heard public comment from many callers who expressed concerns about the plan’s effect on the environment.  Though some expressed thanks for the alterations made from the earlier proposed decision, they still felt that the final plan did not go far enough to take environmental concerns into consideration.  Environmentalists expressed fear that the increased capacity will cause an increase in fossil fuel use while the state is attempting to phase them out. In pointing out the paradox that would ensue with increased fossil fuel usage, one commenter noted that “the reason we’re having extreme weather in the first place is because we’ve been burning natural gas.”  Environmentalists did score some victories, though, as the final plan does include restrictions on large commercial diesel generators. However, environmentalists would have preferred them to be precluded altogether.  CPUC President Matjer noted during the hearing that diesel generators would only be a “last resort,” however.

Attachment 1 to the decision outlines the specific parameters of the ordered measures to reduce demand during critical periods, including a statewide paid Flex Alert paid media campaign to spread awareness during these periods, modifications to critical peak pricing in order to incentivize customers to conserve energy during critical periods, and a new Emergency Load Reduction Program (ELRP), to be developed by the ISOs as a tool to provide emergency load reduction and serve as an insurance policy against the need for future rotating outages. The ELRP pilot becomes effective May 1, 2021. The rulemaking proceeding is ongoing.


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