Before the Public Utilities Commission of the State of California s49

ALJ/JF2/avs PROPOSED DECISION Agenda ID #15354 (Rev. 1) Ratesetting 12/15/16 Item 48 Decision PROPOSED DECISION OF ALJ FITCH (Mailed 11/15/2016)

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Order Instituting Rulemaking to Integrate and Refine Procurement Policies and Consider Rulemaking 12-03-014 LongTerm Procurement Plans. (Filed March 22, 2012)

DECISION FOLLOWING LIMITED REHEARING OF DECISION 15-09-018

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TABLE OF CONTENTS Title Page

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DECISION FOLLOWING LIMITED REHEARING OF DECISION 15-09-018

Summary Today’s decision concerns Decision (D.) 15-09-018. The latter decision awarded, with certain reductions and disallowances, intervenor compensation to L. Jan Reid (Reid). We granted limited rehearing of D.15-09-018 in D.16-02-008, and vacated the relevant portions of D.15-09-018. Limited rehearing was granted to consider three specific issues, and this order on rehearing makes determinations on those issues. First, we award compensation for Reid’s work in the rulemaking that preceded the procurement rulemaking in which D.15-09-018 was issued. Second, we reallocate responsibility for payment of the award, as requested in Reid’s rehearing application. Third, after due consideration, we affirm the disallowance of time Reid claimed for review of advice letters that he did not protest. In this order we consider the facts surrounding this work, and explain the basis of this disallowance. In addition, we award compensation to Reid for 5.7 hours of his work on the rehearing application. This proceeding is closed. 1. Background The Commission established procurement review groups (PRGs) in Rulemaking (R.) 01-10-024 to help the respective investor-owned utilities in meeting their service obligations immediately after the electricity crisis. Successor rulemakings have continued the PRGs, which work with the utilities on design and implementation of their procurement plans. PRG members have included, besides Commission staff, consumer representatives such as L. Jan Reid (Reid). Intervenors’ work in the PRGs is compensable under the intervenor compensation program (see Decision (D.) 02-10-062 at 3-4), and Reid has received several awards for his earlier PRG work.1 The procurement review process now also includes cost allocation mechanism (CAM) groups. Reid has also participated in CAM work, and the compensation request that is at issue here includes both types of work.

1 See, e.g., D.11-03-019 and D.12-06-011. - 3 - R.12-03-014 ALJ/JF2/avs PROPOSED DECISION (Rev. 1)

Pertaining to this rehearing, Reid requested compensation for certain work he performed in connection with the PRG and CAM group of the Pacific Gas and Electric Company (PG&E). The request mostly covered work performed during R.12-03-014 but also included work performed in the previous procurement rulemaking (R.10-05-006). In D.15-09-018, the Commission awarded about 73 percent of the amount Reid requested.2 Reid filed a timely application for rehearing. He challenged the disallowance of compensation for (1) his work performed in R.10-05-006, and (2) his time spent reviewing two PG&E advice letters (ALs) that he did not protest. In addition, Reid challenged the Commission’s allocation of payment responsibility. Reid argued that because his work was limited to PG&E, payment responsibility should fall on PG&E alone, rather than spread proportionally among PG&E, San Diego Gas & Electric, and Southern California Edison Company, as the Commission had ordered in D.1509018. In D.16-02-008, we granted limited rehearing of D.15-09-018. As to the work that Reid performed during R.10-05-006 and included in his current compensation request, we must determine whether that work is compensable pursuant to the guidance we provided in R.12-03-014. As to the work claimed for review of ALs not protested, we must analyze the claim in the context of the relevant statutes and past decisions awarding compensation that appeared to contain language that would provide guidance on how the work done in a PRG or CAM group relates to AL review. Also, we reconsider the allocation of payment responsibility (which utility or utilities should pay the award) in light of the various options open to us. Although not specifically mentioned in the order granting rehearing, today’s decision will also resolve Reid’s request for compensation for his work in preparing his rehearing application. 2. Discussion 2.1. Reid’s Work During R.10-05-006 In D.15-09-018, the Commission disallowed 44 hours’ work that Reid performed before the issuance of R.12-03-014 but during the pendency of the preceding

2 Specifically, $26,114.75 out of the $35,795.25 requested. - 4 - R.12-03-014 ALJ/JF2/avs PROPOSED DECISION (Rev. 1) procurement rulemaking, R.10-05-006.3 The rationale fails to discuss or note Ordering Paragraph 10 of R.12-03-014, which says in relevant part, “Contributions made during the pendency of R.10-05-006 to issues within the scope of this proceeding may be considered for compensation in this proceeding.” On reconsideration, we determine that Reid’s claim for work performed during R.10-05-006 should be granted. The Commission had not previously awarded compensation for this work.4 In addition, we have compared Reid’s hours during R.10- 05-006 to his hours during R.12-03-014; we find that the type of work performed is virtually identical, and the number of hours worked is reasonably proportional to the timeframes within which the work was performed. In short, given our direction in Ordering Paragraph 10 of R.12-03-014, we conclude it was not correct to disallow 44 hours worked during the pendency of R.10-05- 006 on the grounds that those hours preceded issuance of R.1203-014. Further, we now find that Reid’s claim for compensation for those hours is reasonably supported. Today’s decision, therefore, awards compensation to Reid for those hours. 2.2. Reid’s Work in Reviewing Advice Letters that He Did Not Protest Made No Substantial Contribution In D.15-09-018, the Commission disallowed 4.2 hours that Reid claimed for his review of two PG&E ALs.5 D.15-09-018 characterized this claim as “unverifiable,” noting that Reid had not filed a response to the ALs. We affirm the denial of compensation but consider the request for compensation and its context in full, and explain the basis for our conclusion. We first discuss why an intervenor’s review of a formal matter (whether application or AL) is generally not compensable unless the review leads to actual participation that substantially contributes to the Commission’s

3 Specifically, we issued R.12-03-014 on March 23, 2012; Reid worked the disallowed hours from October 4, 2011 to March 20, 2012. 4 Reid has received two prior compensation’s awards for his work in R.10-05-006. In D.1206011, we awarded compensation to Reid for PRG and CAM group work performed between August 9, 2010, and September 29, 2011, all of which precedes the work at issue here. In D.14-06-024, we awarded compensation to Reid for his substantial contribution to D.12-01- 033. This award did not concern Reid’s PRG and CAM group work. 5 AL 4155-E and AL 3402-G. - 5 - R.12-03-014 ALJ/JF2/avs PROPOSED DECISION (Rev. 1) disposition of that particular matter. We then discuss and reject Reid’s arguments to the contrary. 2.2.1. “Substantial Contribution” is the Basis for Award of Intervenor Compensation Pub. Util. Code §§ 1801-1812 provide the statutory framework for the Commission’s intervenor compensation program.6 For present purposes, the key provisions concern “substantial contribution.”7 Specifically, an eligible intervenor may be awarded compensation for its reasonable fees and costs if the intervenor’s “presentation makes a substantial contribution to the adoption, in whole or in part, of the Commission’s order or decision.” (Section 1803 (a).) Pursuant to the statutory definition, the Commission may and does exercise judgment in determining when an intervenor’s participation has substantially assisted the Commission’s decision making. To encourage the procurement group participation of intervenors (such as Reid), along with other “nonmarket participants,” the Commission made a determination that intervenors “should be eligible to seek compensation for their work in these [PRG] groups and in the ongoing review of procurement advice letters and expedited applications.” 8 In D.16-02-008, we summarized our past holdings finding that intervenors’ work made a substantial contribution to the orders we issue in procurement proceedings. In prior decisions, this Commission has also given guidance on how intervenors may support their compensation requests for such participation. Specifically, D.07-11- 024 (at 5-6) requires that intervenors participating in these groups include in their requests enough non-confidential information for the Commission to make the findings required by §§ 1801-1812. These intervenors must indicate the types of programs, policies, practices, or documents reviewed in connection with the work and how that work contributed to an outcome that benefited ratepayers. They must explain how their work added value to the procurement process because of the intervenor’s unique analysis, perspective, or work product, or because of specific expertise or skills of the intervenor. 6 Subsequent statutory references are to the Public Utilities Code unless otherwise noted. 7 See e.g., §§ 1801.3(d), 1802(i), 1802.5, 1803(a), and 1804(c). 8 See D.02-10-062 at 3-4, 72 (Finding of Fact 28). - 6 - R.12-03-014 ALJ/JF2/avs PROPOSED DECISION (Rev. 1)

(E.g., D.07-11-024, at 5.) These intervenors must also demonstrate reasonable collaboration with other group members to minimize duplication of effort. The main point to note about this application of the requirements of the intervenor compensation program to PRG and similar work is that intervenors have a burden to demonstrate that work performed in connection with the procurement process benefits that procurement process, and the OIRs and decisions establishing that process. 2.2.2. Intervenor’s Participation in Procurement Groups May Assist Utilities in their Preparation of Procurement-Related Applications and Advice Letters We established the PRGs in R.01-10-024 to provide peer review to the utilities on the design and implementation of their procurement plans. The electricity crisis and its aftermath had required a complete re-examination of how investor-owed utilities were to meet their service obligations to electricity customers. Among other things, we expected that these plans would have to be produced quickly and reviewed on an expedited basis. We instituted peer review to allow problems and controversies to be handled quickly and informally before the utility formally submitted its plan for Commission approval. This was designed to avoid having more formal proceedings be the main venue where intervenors provided advice, comment, or disagreement with a utility’s proposal. For present purposes, we emphasize that we intended the procurement group participation of intervenors, along with other non-market participants, would limit or avoid hearings or other litigation over utility compliance filings. We have stated that this procurement group work, preceding a formal filing by the utility, may benefit the subsequent formal application or advice letter proceedings.9 At the time procurement peer review was established, the procurement process was less orderly that it is today and we anticipated that peer reviewers would contribute to procurement proceedings when they performed “ongoing review of procurement

9 See D.12-11-050 at 8-9. In that decision, reviewing a request for intervenor compensation by The Utility Reform Network (TURN) for procurement group participation, we specifically noted among the benefits of such participation that TURN was able to limit or avoid litigation in subsequent applications or advice letters. (Id. at 8-9.) Cf. D.12-06-011 at 7, noting Reid’s assertion that issues he raised were resolved in the PRG process, thereby reducing litigation efforts. - 7 - R.12-03-014 ALJ/JF2/avs PROPOSED DECISION (Rev. 1) advice letters and … applications” (see D.02-10-062). In subsequent decisions awarding compensation for PRG and similar work we have stated that parties may seek compensation for “a wide range of tasks that go beyond simply attending the actual [PRG] meetings.” However, the main philosophy behind our approach has always been that, in order to be compensable, work must be shown to have made a substantial contribution to the relevant procurement proceeding. This is why intervenors were required by D.07-11-024 to provide an explanation of their activities (despite the confidential nature of procurement work) that would be sufficient to allow us to conclude they had made a substantial contribution, as defined by statute. It is important to note that the language of the intervenor compensation statute has led to this Commission’s practice of seeking to ensure that intervenors file requests for compensation in the proceeding in which the contribution was made, making reference to the order issued in that proceeding. When Reid applied for rehearing of D.15-09-018, he claimed that we had denied compensation for review of advice letters in a way that departed from our prior decisions without explanation. In D.16-02-008 we granted rehearing, “to consider the extent to which we should maintain consistency with our past holdings in this instance.”10 This grant of rehearing specifically did not determine that we believed it was improper to deny Reid’s request for compensation, stating: “Intervenors are put on notice that compensation should not be considered automatic and intervenors must adequately justify requests for awards.” 11 While we noted that past decisions “appeared” to award compensation for review of advice letters that were not protested, and that compensable work “can” include follow-up work on advice letters, we determined that on rehearing we would “consider past holdings before ruling on this question.” 12 We also noted that “the statutes governing intervenor compensation require us to review each claim on its own merits ….”13

10 D.16-02-008, at 5. 11 D.16-02-008, at 5, fn. 5. 12 D.16-02-008, at 4, 5. 13 D.16-02-008, at 5, fn 5. - 8 - R.12-03-014 ALJ/JF2/avs PROPOSED DECISION (Rev. 1)

Our past decisions do not provide any reasoned holdings establishing a precedent or rule requiring that when an intervenor reviews an advice letter that is not protested, the intervenor’s work would fall into a category that is normally compensable. Rather, based on the facts of specific prior proceedings, we have determined on occasion that such work merits compensation because sometimes compensable PRG work can involve follow-up work. But we disagree with Reid’s contention that these few, relatively unexplained decisions establish any precedent or rule that must be followed here. In fact, now that we have determined to consider this issue in far more depth than we did in our prior decisions, we find that this practice should be considered the exception rather than the rule because the intervenor compensation statute provides a mechanism under which intervenors can be compensated for work in the proceeding where that work is performed. This is because compensation is to be awarded for contributions to a particular Commission order. We would normally expect work on advice letters or expedited proceedings that come after a topic has been addressed in the PRG or CAM group context to be compensated in those proceedings. For such work to be compensated as part of PRG work, the intervenor must demonstrate how performing such work specifically contributed to the success of the PRG or CAM group participation. 2.2.3. Reading a Formal Filing, Without Further Participation, Does Not Constitute a Substantial Contribution We now apply the foregoing discussion to Reid’s request for compensation for time spent reading two PG&E advice letters that Reid did not protest.14 In fact, neither Reid nor anyone else protested those advice letters, and both were approved. We expect, as noted earlier, that most procurement advice letters would not be protested. Their non-controversial character is one benefit of the procurement groups and is a basis for compensating an intervenor’s work in those groups. Awarding additional compensation to the intervenor for reviewing a non-controversial procurement advice letter after its filing would be inappropriate if the intervenor’s actual substantial contribution occurred before the advice letter was filed, in the context of PRG work where compensation is awarded in a procurement rulemaking proceeding. Awarding

14 We accept Reid’s assertion that both advice letters are procurement-related. - 9 - R.12-03-014 ALJ/JF2/avs PROPOSED DECISION (Rev. 1) compensation for work on advice letters that result from PRG work risks double-counting work performed in PRG or similar groups by making an additional award for advice letter review on a matter where the intervenor made a successful contribution, and was compensated for making that contribution, in the PRG context. Further, as noted above, granting such awards risks awarding compensation in the wrong proceeding. Accordingly, we should not adopt a presumption that favors awarding compensation for reviewing advice letters that are not protested. Only when an intervenor can demonstrate that such review is necessarily connected with the compensable work of participating in a PRG or similar group should such work be compensated. Moreover, in cases where an advice letter contains either an objectionable change made by the utility after procurement group review, or a controversy left unresolved by procurement group review we are not convinced that work on such an advice letter should be compensated as part of PRG work. In such circumstances, an intervenor may protest the advice letter. If the Commission uses the protest in the disposition of the advice letter, the intervenor’s work on the protest may entitle the intervenor to an award of compensation. This compensation would be specific to the protest. This treatment of advice letters (procurement or otherwise) has the benefit of mirroring our treatment of applications and other formal proceedings in regard to intervenor work. Large investor-owned utilities such as PG&E usually file many applications and advice letters. An intervenor interested in a particular utility may review for informational purposes most or all of that utility’s filings without actually participating in most of the underlying proceedings.15 Such review, without more, is not compensable under the statute. That rule is true of applications, and there is no basis for using a different rule in the case of advice letters. The latter, in comparison to applications, are greatly simplified as to both subject matter and procedure. (See General Rule 5.1 of General Order 96-B. See also our general discussion of advice letters in Section 2.2.4. below.)

15 An intevenor’s reasons for choosing not to participate might include the unobjectionable nature of the utility request or the intervenor’s own selection of issues, staffing constraints, and priorities. - 10 - R.12-03-014 ALJ/JF2/avs PROPOSED DECISION (Rev. 1)

2.2.4. Advice Letters are Intended to Concern Non-Controversial Matters, and the Advice Letters at Issue Here are No Exception Reid, in his application for rehearing at 9, asserts that the Commission has found that “intervenor should be fully compensated for time spent reviewing advice letters and expedited applications.”16 Reid bases his assertion on Finding of Fact 28 of D.02-10-062, which states as follows (emphasis added by Reid): Participation in the procurement review group makes a significant contribution to effective implementation of this decision and parties eligible to receive intervenor compensation awards in this proceeding should be eligible to seek compensation for their work in these groups and in the on-going review of procurement advice letters and expedited applications. We have already explained that this holding does not mean that time spent reviewing advice letters automatically merits compensation. This holding must be considered alongside the two important principles we apply when we administer the intervenor compensation program in the context of procurement review groups. Our finding regarding “on-going review” must be read in the context of (1) the statutory definition of “substantial contribution,” and (2) the Commission’s guidance in D.07-11- 024 on the requisite showing to establish substantial contribution for procurement group work. General Order 96-B contains comprehensive rules to govern advice letter practice at the Commission. The first paragraph of General Rule 5.1 describes “Matters Appropriate to Advice Letters” as follows: The advice letter process provides a quick and simplified review of the types of utility requests that are expected neither to be controversial nor to raise important policy questions. The advice letter process does not provide for an evidentiary hearing; a matter that requires an evidentiary hearing may be considered only in a formal proceeding. Consistent with the description, the large majority of advice letters are not protested. Moreover, only a fraction of advice letters (chiefly, those filed and reviewed

16 Reid does not limit his assertion to procurement advice letters and applications, but the only authority he cites is so limited. - 11 - R.12-03-014 ALJ/JF2/avs PROPOSED DECISION (Rev. 1) under Tier 3) are disposed via Commission order. Instead, the Commission has authorized the respective Industry Divisions to dispose of advice letters whose review is “ministerial,” i.e., those filed and reviewed under Tiers 1 or 2.17 None of these provisions suggests that advice letter review will normally or generally be an important task that makes a “significant contribution.” Here, the two advice letters to whose review Reid claims to have contributed were both routine “non-controversial” matters. In fact, only one of the two advice letters (AL 4155-E) was disposed of by Commission order (Res. E4585 (August 5, 2013)). 18 AL 4155-E (and a companion advice letter, AL 4204-E) proposed minor amendments to PG&E’s adopted procurement plan. PG&E filed them because D.07-12- 052 required the utilities to file an AL for any update to their respective procurement plans. Resolution E-4585 (at 2) provides the following background and discussion of AL 4155-E: AL 4155-E was filed by PG&E in response to actions taken by companies that operate exchanges, who changed the names and definitions of some products in response to Dodd-Frank legislation of 2010. Dodd-Frank became effective in late 2010 and sought to reduce risk in financial markets partially by increasing transparency in financial products and market transactions. In order to mitigate risk of new Dodd-Frank oversight, the three major exchanges (ICE, NYMEX, CME, and NGX in Canada) changed all their energy swap products formally into futures contracts, which placed the regulation of these products with the Commodities Futures Trading Commission (CFTC) which is more understood and established. PG&E had previously conducted significant energy swap contracts with these counterparties, but pursuant to the redefinitions made by these companies after DoddFrank, PG&E filed AL 4155-E to conform the bundled procurement plan and continue to do business as before. . . . . Energy Division has reviewed . . . the proposed changes to PG&E’s defined list of procurement products and counterparties, and found

17 General Rules 7.6.1 and 7.6.2 govern advice letter review and disposition. The respective Industry Rules govern the allocation of advice letter subject matter among Tiers 1, 2, and 3. 18 The other advice letter was AL 3402-G. It became effective on August 22, 2013, without Commission order. (See letter dated September 3, 2013, from the Director of the Energy Division to PG&E.) - 12 - R.12-03-014 ALJ/JF2/avs PROPOSED DECISION (Rev. 1)

them to be in compliance with the Commission’s orders. The proposed changes do not make material changes to PG&E’s procurement authorization or procurement activity. In short, what AL 4155-E proposed, and Resolution E-4585 approved (in Ordering Paragraph 1), is simply a change to a naming convention: The request of the PG&E to modify the swaps product naming convention as requested in AL 4155-E is approved. PG&E’s hedging plan shall reflect the new defined term for Swap which means either financial swap or financial future contracts. PG&E is authorized to amend the definitions for the several products to also include futures as requested. We conclude from Resolution E-4585 that AL 4155-E was minor and noncontroversial in nature, and that the review of AL 4155E by Energy Staff was adequate without input from intervenors or other third parties. Reid contended in his application for rehearing (at 8) that his review of AL 4155-E was for “informational purposes” because “[h]edging is a major topic in PG&E’s PRG.” Assuming without conceding that AL 4155-E makes any significant change to PG&E’s hedging plans, we would not have stated in Resolution E-4585 that the advice letter would “not make material changes to PG&E’s procurement authorization or procurement activity.” Moreover, as we explained earlier, an intervenor’s time spent for general informational purposes, without a more direct link to “substantial contribution,” is not compensable. (See Section 2.2.3, above, text accompanying note 12.) We require intervenors to provide us with sufficient information on their activities to be able to make the required determination that their work made a significant contribution. In this case, Reid has not made the showing required of him. The showing relating to the other advice letter provides even less information. Based on the descriptions of the activities undertaken by Reid in his request for compensation we conclude that, in our judgment, Reid did not make an adequate demonstration that his work should be compensated as part of his PRG work.

2.2.5. Today’s Decision Does Not Rescind, Alter, or Amend Any Prior Commission Order or Decision In today’s decision, we interpret and explain various provisions of statute and Commission orders as they relate to compensability of one specific intervenor’s procurement-related work. Reid argues in his application for rehearing that the disallowance of his claim for time spent reviewing these advice letters effectively changed various prior decisions without notice to parties and opportunity to be heard, thus, violating Pub. Util. Code § 1708. Reid’s argument is without merit, and we rejected that argument when (in D.16- 02-008) we granted limited rehearing on other grounds. As we explained there, when we interpret and apply past decisions, we do not modify them. (Id. at 5, note 5.) Today’s decision appropriately construes intervenor compensation law and policy, and applies them to the specific facts set forth here, and the claims Reid has made about how past decisions apply to present circumstances. 2.3. Allocation of Payment Responsibility As we noted when we granted limited rehearing, we expressly have followed two approaches when requiring compensation for an intervenor’s work on PRGs and CAM groups. When the intervenor worked on the respective groups of each of the three major investor-owned utilities in a procurement rulemaking, we allocated payment responsibility among all three utilities;19 and when the intervenor did PRG/CAM work for one of the three utilities, we allocated payment responsibility entirely to that utility.20 However, in D.15-09-018, we awarded compensation for Reid’s work on PG&E’s PRG and CAM group but allocated payment responsibility among all three utilities. In doing so, the Commission was following the allocation approach in D.12-11-050, a more recent decision than D.12-06-011, but did not otherwise justify the allocation to all three utilities, rather than to PG&E alone. We now determine that Reid’s situation (working only on PG&E’s PRG and CAM group) is reasonably distinguishable from TURN’s situation in working with all three

19 See, e.g., D.12-11-050 (TURN). 20 See e.g., D.12-06-011 (Reid). - 14 - R.12-03-014 ALJ/JF2/avs PROPOSED DECISION (Rev. 1) utilities. We therefore agree with Reid that PG&E alone should bear payment responsibility for the award in question. Our rehearing decision noted certain further concerns about how procurement rulemaking proceedings, such as R.12-03-014, and the associated PRG and CAM group work, relate to the intervenor compensation statute. (See D.16-02-008 at 6-7.) In particular, Pub. Util. Code § 1807(a) provides in relevant part that an award of intervenor compensation “shall be paid by the public utility that is the subject of the hearing, investigation, or proceeding, as determined by the commission . . . . “ (Emphasis added.) This statute is sufficiently broad to allow us to address the common situation where a proceeding involves, e.g., many utilities, or more than one phase, or various nonhearing activities (including advisory, settlement, mediation, etc.). Rulemaking commonly involves such complexities, and we think that both the letter and the spirit of the intervenor compensation statute authorize us to determine that only one of several respondent utilities should pay for particular work by a particular intervenor. Reid’s request for compensation here exemplifies the circumstances where such a determination is appropriate. Another concern noted in D.16-02-008 regarding payment responsibility here is the seeming relevance to that issue of D.00-01-020. In that decision, we created a mechanism whereby “all utilities in an industry that are affected by an industry-wide rulemaking [may] share in funding intervenor compensation awards“ stemming from such rulemaking. However, the mechanism created in D.00-01-020 cannot be used here. That mechanism is strictly limited to “quasilegislative rulemaking proceedings where no specific respondents are named.”21 In this and earlier procurement rulemakings, we have specifically named respondents, including both public utility and non-utility respondents. Consequently, the circumstances of this rulemaking fall outside the parameters of the intervenor funding mechanism that we created in D.00-01-020. Moreover, as discussed earlier in this section, Reid is claiming compensation for work specific to PG&E’s PRG and CAM group. We have agreed with Reid that in those circumstances, responsibility for paying his claim should be limited to PG&E and not

21 See generally D.00-01-020, 4 CPUC 3d 20. - 15 - R.12-03-014 ALJ/JF2/avs PROPOSED DECISION (Rev. 1) spread among all three major investorowned utilities. By the same reasoning, we find that spreading payment responsibility among all electric utilities would be still less appropriate. 2.4. Reid’s Work on His Rehearing Application Reid seeks compensation for his work on the application for rehearing resolved today. Reid states that he spent 7.6 hours on the application, and he asks that our award include interest based on the date of the decision for which we granted rehearing. As discussed above, we have adopted, in whole or part, three of Reid’s four contentions in his application for rehearing. We find, therefore, that Reid has made substantial contributions to today’s decision in these three respects. He had also contended that D.15-09-018 modified prior decisions without notice and opportunity to be heard, in violation of Section 1708. We have rejected that contention (see Section 2.2.6 above), and we find that Reid’s’ application for rehearing did not contribute to today’s decision in this respect. Reid did not allocate his hours by contention, so we will disallow 25 percent (or 1.9 hours) of the total time that Reid claims for the work on his application for rehearing. We find that the remaining 5.7 hours Reid spent on the rehearing application (a 12-page document with considerable factual detail and legal reasoning) was reasonable and productive. We therefore award compensation for the remaining 5.7 hours at a rate of $220 per hour, reflecting the hourly rate we have used for Reid’s work performed in 2015. However, this work was performed well after the other work that we deal with in this order. Therefore, interest on the award of compensation for work on Reid’s rehearing application will start on January 4, 2016, which is 75 days after the filing of Reid’s application for rehearing (October 21, 2015).

3. Conclusion We have reconsidered Reid’s request for compensation in light of D.1602008 granting in part Reid’s application for rehearing of D.15-09-018. We now increase our award to compensate Reid for certain work he performed in a prior rulemaking, and for his work on the application for rehearing. Further, as proposed by Reid, we allocate to PG&E sole responsibility for payment of the award. However, we affirm our denial of compensation for Reid’s review of advice letters that he did not protest. 4. Comments on Proposed Decision As provided by Rule 14.3 of our Rules of Practice and Procedure and Pub. Util. Code § 311(g)(1), the draft decision of the ALJ in this matter was mailed to the parties. No comments were received. 5. Assignment of Proceeding Michel Peter Florio is the assigned Commissioner and Julie A. Fitch is the assigned ALJ in this proceeding. Findings of Fact 1. The procurement review group work for which Reid seeks compensation was concerned solely with PG&E’s procurement activity. 2. The order instituting this rulemaking named specific respondents. 3. Some of the work for which Reid seeks compensation was performed in the immediately preceding procurement rulemaking (R.10-05-006). The specific work in question was performed from October 4, 2011, to March 20, 2012. The Commission has not previously awarded compensation for this work. 4. The tasks that Reid performed from October 4, 2011, to March 20, 2012, are typical of the procurement review activity that we have compensated in prior awards, and Reid claims a reasonable number of hours for performing those tasks. 5. Advice letters typically concern matters that are routine and noncontroversial. 6. The two advice letters to which Reid claims he made substantial contributions are routine and non-controversial. 7. The Commission intended that the procurement group participation of intervenors, along with other non-market participants, would limit or avoid lengthy hearings or

other litigation over utility compliance filings, such as the advice letters at issue here. 8. An intervenor’s participation in the review of an advice letter after its filing is distinct from the intervenor’s procurement group work. 9. An intervenor’s review of an advice letter that the intervenor did not protest is not, in itself, compensable. 10. Reid’s claim for compensation for his review of the two advice letters at issue here does not demonstrate that the review entailed unique analysis, perspective, or work product, or specific expertise or skills. 11. Review by an intervenor of a utility’s advice letter for the intervenor’s informational purposes does not, without more, constitute a substantial contribution under the intervenor compensation statute. 12. Reid, in his application for rehearing, requests compensation for 7.6 hours work in preparing his application for rehearing. Reid made substantial contributions to today’s decision in that today’s decision adopts Reid’s positions on (1) compensability of work he performed in a prior rulemaking, and (2) allocation of payment responsibility. Although we rejected his position on advice letters, he was successful in part to the extent that we modified and significantly clarified the rationale for rejection set forth in D.15-09-018. However, Reid’s contention regarding violation of Pub. Util. Code § 1708 was wholly without merit. 13. It is reasonable to award compensation for 5.7 of the 7.6 hours that Reid worked on his application for rehearing of D.15-09-018. 14. L. Jan Reid has made substantial contributions to R.1005-006 and R.1203014 to the extent described herein. 15. Reid’s requested hourly rates, as adjusted herein, are comparable to market rates paid to experts and advocates having similar training and experience and offering similar services. 16. Reid’s costs and expenses are reasonable and commensurate with the work performed.

17. Reid failed to demonstrate that work on advice letters that were not protested was the type of work that should be compensated in connection with PRG work. 18. The total of reasonable compensation is $34,482.75 for work covered in this decision and in D.15-09-018, other than Reid’s work on his application for rehearing. 19. The total of reasonable compensation for Reid’s work on the application for rehearing is $1,254.00. Conclusions of Law 1. Because the work for which Reid seeks intervenor compensation was concerned solely with PG&E’s procurement groups, the Commission, pursuant to Pub. Util. Code § 1807 (a) and consistent with prior Commission compensation awards, should allocate entirely to PG&E the responsibility for payment of the award in today’s decision. 2. In D.00-01-020, the Commission created a mechanism whereby all utilities in an industry that are affected by an industry-wide rulemaking would share in funding related intervenor compensation awards. That mechanism is not available here because the Commission limited its use to rulemakings where, in contrast to the procurement rulemakings at issue here, no specific respondents were named. 3. Pursuant to the order instituting the rulemaking at issue here (R.1203014), an intervenor’s contributions made during the pendency of the preceding procurement rulemaking (R.10-05-006) but within the scope of the successor rulemaking may be considered for compensation in the successor rulemaking. 4. Reid should be awarded compensation for his hours claimed for work that he performed from October 4, 2011, to March 20, 2012, related to R.10-06-006. 5. The Commission has provided guidance in D.07-11-024 on how an intervenor participating in a procurement review group may make a “substantial contribution” within the meaning of the intervenor compensation statute. Under this guidance, the intervenor must explain how its work added value to the procurement process because of the intervenor’s unique analysis, perspective, or work product, or because of specific expertise or skills of the intervenor.

6. None of our past decisions contain a reasoned holding stating that work on advice letters that are not protested should be presumed to be compensable. The better reading of our past decisions, considered together, is that only when an intervenor demonstrates that such work is related to PRG work that is compensable should compensation be awarded. 7. This Commission may depart from its past practices if, on reflection and due consideration, it determines that a better approach should be adopted based on present circumstances. Intervenor compensation awards, in particular, are to be made on a case-by-case basis, as an exercise of this Commission’s judgment. 8. Reid did not make a substantial contribution to the Commission’s disposition of the advice letters at issue here and did not demonstrate that this work was part of compensable PRG work. 9. Today’s decision interprets and applies various prior Commission decisions to the present circumstances and does not modify the language or result of any past decision except to the extent that it modifies D.15-09-018 pursuant to the decision granting its partial rehearing (D.16-02-008). 10. In the interest of efficient administration of the intervenor compensation program (pursuant to the legislative intent expressed in Pub. Util. Code § 1801.3), it is reasonable to address in today’s decision Reid’s request for compensation for his work in applying for rehearing of D.15-09-018, rather than requiring Reid to file a new request for compensation specific to today’s decision. 11. Interest on the award of compensation for Reid’s work on his rehearing application should start on January 4, 2016, which is 75 days after the date when Reid filed his application for rehearing (October 21, 2015). The work should be compensated at $220 per hour, which is the hourly rate that the Commission has used for Reid’s work performed in 2015. 12. Today’s order should be made effective immediately in order to minimize further delay in the payment of the award. 13. Reid’s claim, with the adjustments set forth above, satisfies all requirements of Pub. Util. Code §§ 1801-1812.

O R D E R

IT IS ORDERED that: 1. The total amount of compensation awarded to L. Jan Reid for contributions to the original proceedings in Rulemaking (R.) 10-05-006 and R.1203014 is $34,482.75 (reduced 0.96 percent). 2. The amount of compensation awarded to L. Jan Reid for contributions to the rehearing of Decision 15-09-018 is $1,254.00 (reduced 25 percent). 3. To the extent not previously vacated, the tables in “Part III: Reasonableness of Requested Compensation B. Specific Claim” contained in Decision 15-09-018 are superseded with the following tables: B. Specific Claim:*

CLAIMED CPUC AWARD ATTORNEY, EXPERT, AND ADVOCATE FEES Item Year Hours Rates $ Basis for Rate* Total $ Hours Rates $ Total $

22 2011 28.8 $200.00 D.12-06-011, $5,760 28.8 $185.00 $5,328.00 Appendix, L. Jan Reid, Resolutions Expert & ALJ281 and Advocate ALJ287 23 2012 72.4 $200.00 D.12-06-011, $14,480 70.9 $200.00 $14,180.00 Appendix, L. Jan Reid, Resolutions Expert & ALJ281 and Advocate ALJ287 24 2013 70.1 $215.00 D.12-06-011, $15,071.50 67.4 $215.00 $14,491.00 Appendix, L. Jan Reid, Resolutions Expert & ALJ281 and Advocate ALJ287 Subtotal: $35,311.50 Subtotal: $33,999.00

INTERVENOR COMPENSATION CLAIM PREPARATION ** Item Year Hours Rate $ Basis for Rate* Total $ Hours Rate Total $ 2013 4.5 $107.50 D.12-06-011, $483.75 4.5 $107.50 $483.75 L. Jan Reid, Appendix, Expert & Resolutions ALJ281 Advocate and ALJ287

22 Approved in D.12-01-029. There was no cost of living adjustment in 2011; see Res. ALJ-267. 23 Approved in D.14-12-072. 24 Approved in D.14-12-072. - 21 - R.12-03-014 ALJ/JF2/avs PROPOSED DECISION (Rev. 1)

Subtotal: $483.75 Subtotal: $483.75 TOTAL REQUEST $: $35,795.25

TOTAL AWARD: $34,482.75 **We remind all intervenors that Commission staff may audit their records related to the award and that intervenors must make and retain adequate accounting and other documentation to support all claims for intervenor compensation. Claimant’s records should identify specific issues for which it seeks compensation, the actual time spent by each employee or consultant, the applicable hourly rates, fees paid to consultants and any other costs for which compensation was claimed. The records pertaining to an award of compensation shall be retained for at least three years from the date of the final decision making the award. ** Reasonable Claim preparation time typically compensated at ½ of preparer’s normal hourly rate.

Application for Rehearing pf D.15-09-018 Item Year Hours Rate $ Basis for Rate* Total $ Hours Rate Total $ L. Jan Reid, 2015 7.6 $220.00 Resolution ALJ303 $1,672.00 5.7 $220.00 $1,254.00 Expert & Advocate 4. To the extent not previously vacated, the table in “Part III.D. CPUC Disallowances and Adjustments” contained in Decision 15-09-018 is superseded with the following table: Item Reason A Reduction of 1.5 hours from Reid’s 20112 hours and 2.7 hours from Reid’s 2013 hours. Reid spent these hours reviewing two advice letters that he did not protest. Reid fails to demonstrate any substantial contribution to the Commission’s disposition of the advice letters. B Reduction of 1.9 hours of the 7.6 hours total claimed for Reid’s application for rehearing of D.15-09-018. Reid failed to make a substantial contribution on one of the four grounds argued for rehearing.

5. L. Jan Reid is awarded a total of $35, 736.75, plus interest, in two separate payments as specified in Ordering Paragraphs 6 and 7, below. 6. Within 30 days of the effective date of this decision, PG&E shall pay L. Jan Reid $34,482.75 plus compound interest at the rate earned on prime, threemonth nonfinancial commercial paper as reported in Federal Reserve Statistical Release H.15, beginning January 15, 2014, the 75th day after the filing of Reid’s request, and continuing until full payment is made. This payment shall be reduced by the amounts, if any, that PG&E, San Diego Gas & Electric Company (SDG&E), and/or Southern California Edison Company (SCE) previously paid to Reid under

the terms of Decision 15-09-018, and PG&E shall reimburse SDG&E and SCE for their respective payments previously made. 7. Within 30 days of the effective date of this decision, Pacific Gas and Electric Company shall pay L. Jean Reid $1,254.00 plus compound interest at the rate earned on prime, threemonth non-financial commercial paper as reported in Federal Reserve Statistical Release H.15, beginning January 4, 2016, the 75th day after the filing of Reid’s application for rehearing of Decision 15-09-018, and continuing until full payment is made. 8. The Appendix attached to today’s decision supersedes and replaces the Appendix previously attached to Decision 15-09-018. 9. Rulemaking 12-03-014 is closed. This order is effective today. Dated , at San Francisco, California.

- 23 - R.12-03-014 ALJ/JF2/avs

APPENDIX

Compensation Decision Summary Information Compensation Decision: Modifies Yes Decision? (supersedes D.15-09-018) Contribution Decision(s): N/A Proceeding(s): R1203014; R1005006 Author: ALJ Fitch Payer(s): Pacific Gas and Electric Company Intervenor Information Intervenor Claim Amount Amount Multiplier? Reason Date Requested Awarded Change/Disallowance L. Jan Reid 11/1/13 $35,795.25 $34,482.75 N/A Failure to make substantial contribution to disposition of two advice letters; lower hourly rate.

L. Jan Reid 10/21/15 $1,672.00 $1,254.00 N/A Applying rejection in part. Advocate Information First Last Name Type Intervenor Hourly Fee Year Hourly Fee Name Requested Hourly Adopted Fee Requested L. Jan Reid Expert L. Jan Reid $200.00 2011 $185.00 L. Jan Reid Expert L. Jan Reid $200.00 2012 $200.00 L. Jan Reid Expert L. Jan Reid $215.00 2013 $215.00 L. Jan Reid Expert L. Jan Reid $220.00 2015 $220.00

(END OF APPENDIX)