Pacific Gas and Electric asks FERC to toss Contra Costa complaint

Contra Costa Generating Station LLC (CCGS), which is building a 586-MW gas-fired power plant in California, moved on Jan. 24 at the Federal Energy Regulatory Commission to intervene in a dispute over a contractual relationship with Pacific Gas and Electric.

In December 2012, CAlifornians for Renewable Energy, Michael Boyd and Robert Sarvey (together known as CARE) filed a petition for enforcement under the Public Utility Regulatory Policies Act of 1978. The petition names CCGS, Pacific Gas and Electric (PG&E) and the California Public Utilities Commission (CPUC) as respondents in a purported request for FERC to “enforce the requirements of PURPA” against each of the respondents.

“For the reasons discussed herein and in the Motion to Dismiss being filed today by PG&E, the Commission should promptly dismiss the PURPA Petition and should do so without issuing a Notice of Intent Not to Act,” said CCGS in its Jan. 24 filing. “As the Commission is aware, Section 2 10(h) of PURPA requires the filing of an enforcement petition with FERC prior to a party seeking federal court action against a state commission for alleged PURPA violations. Here, CARE’s Petition is so patently deficient both procedurally and substantively, the Commission should take appropriate action to assure that it is dismissed in these dockets without, at this juncture, inviting further court process through issuance of a Notice of an Intent Not to Act. In the alternative, if the Commission decides not to dismiss CARE’s Petition summarily, the Commission should issue a Notice of Intent Not to Act on the basis that CARE’s substantive claims are unsupported and without merit.”

CCGS is developing the Oakley generation facility, a state-of-the-art, combined-cycle natural gas-fired facility in Oakley, Calif. CCGS is party to an Amended Purchase and Sale Agreement with PG&E under which CCGS will develop, construct and transfer the Oakley project to PG&E. CCGS is owned by Radback Energy Inc., which is engaged in electric generation development in California.

Among the various CCGS arguments is that CCGS cannot be named as a respondent in a Section 210(h) PURPA enforcement proceeding and CARE’s petition should therefore be summarily dismissed on that basis. CCGS said it is an independent developer of wholesale generation facilities in California and is neither a state utility commission, nor a “nonregulated electric utility” within the meaning of PURPA.

PG&E: CARE’s complaint is a time-waster like its prior complaints

PG&E in its Jan. 24 petition to FERC said that by dismissing the petition as not in accordance with PURPA or Rule 203, the commission may be able to prevent CARE from wasting further resources.

“In recent years, CARE has filed numerous complaints and petitions against the California Public Utilities Commission (‘CPUC’), PG&E, other California utilities, and, more recently, against utilities and regulators in Massachusetts that are filled with vague, unclear, and often incomprehensible allegations of wrong-doing,” wrote PG&E. “The Commission has repeatedly warned CARE that complaints and petitions that are based solely on unsubstantiated allegations, without any evidence or analysis, fail to meet the requirements of Rules 203 and 206 and will be summarily dismissed. In fact, in an order issued a little more than a year ago, the Commission warned CARE that continuing to file meritless complaints and petitions could result in CARE being disqualified under Rule 2102 and being denied the privilege to appear or practice before the Commission.”

In the latest version of its many petitions and complaints, CARE alleges that the CPUC, PG&E and a third-party project developer, CCGS, have violated PURPA. “Notably, CARE’s latest petition is virtually identical to other recent CARE petitions and includes many paragraphs that are pulled verbatim from these earlier, unsuccessful petitions,” said PG&E. “As with all of CARE’s earlier complaints and petitions, this Petition fails to include any evidence or analysis. Instead, CARE seems content to base its Petition on unsupported and vague allegations, many of which concern activity that is not related to PURPA. In short, CARE continues to ignore this Commission’s earlier warnings as to what constitutes a sufficient complaint or petition.”

The Oakley project, which is currently under construction, is a 586-MW combined-cycle facility, PG&E noted. “The Oakley Project is specifically designed to facilitate the integration of intermittent renewable resources, which are being developed at an unprecedented level in California, and will assist with the retirement of aging, inefficient once-through cooling (‘OTC’) units,” the utility added. “The Oakley Project will have one of the lowest heat rates in California and, as a result, will produce substantially fewer Greenhouse Gas (‘GHG’) emissions and other pollutants as compared to existing plants with higher heat rates. The Oakley Project is a much-needed, environmentally beneficial, new combined-cycle facility that is essential for ensuring continued grid reliability in consideration of California’s aggressive renewable energy goals and state policies to facilitate OTC retirements.”

PG&E added: “CARE’s Petition rests on its assertion that the [California] Commission approved ‘a contract for wholesale power with Oakley that is not just and reasonable under Section 205 and 206 of the Federal Power Act and the price paid exceeds PURPA avoided cost paid by PG&E [currently] to existing QFs and Cogenerators.’ CARE also asserts that the capital costs of the Oakley Project are too high, relying on dated information for facilities that, in some cases, came on-line almost a decade before the Oakley Project will come on-line. However, the Amended PSA approved by the CPUC in December 2012 is not a wholesale power contract, nor is it a QF power purchase agreement. Instead, the Amended PSA provides for the purchase of the Oakley Project itself once construction and permitting have been completed by CCGS, subject to the terms of the Amended PSA. Sections 205 and 206 of the Federal Power Act and PURPA do not address a utility’s purchase of a generating facility, nor do these statutory provisions address retail rates or the inclusion of a new generating facility in a utility’s ratebase.”

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.