USA – CALIFORNIA Law and Practice Contributed by: Nora Sheriff, Gwenneth O’Hara, Samir Hafez, Antonio Carrejo and Timothy Lee, Buchalter LLP
Non-Nuclear Decommissioning For non-nuclear generation facilities, costs for decom- missioning may vary. Before a CPUC-regulated util- ity collects decommissioning costs from ratepayers, the CPUC must first make a finding that recovery of those costs is just and reasonable. The CPUC may authorise a utility to record decommissioning costs in a Memorandum Account, subject to future review for just and reasonableness. 4. Transmission Lines and Associated Facilities 4.1 Constructing and Operating Transmission Lines and Associated Facilities In California, the ownership, construction and opera- tion of transmission lines and associated facilities are subject to the requirements set forth in the CPUC’s GO 131-E. This GO also governs transmission-level BESS projects. Any qualified entity may propose to construct and operate transmission lines if the CAISO approves the proposal via the CAISO TPP, or if the entity obtains a CPCN from the CPUC. The CPUC’s Electric Rule 21 encompasses intercon- nection, operating and metering requirements for gen- eration facilities that connect to an IOU’s distribution system and CPUC-jurisdictional transmission system. Rule 21 does not govern CAISO-controlled transmis- sion interconnections. FERC issues permits for construction or modifica- tion of electric transmission lines, but only for those that are located in National Interest Electric Transmis- sion Corridors (“National Corridors”). FERC will notify stakeholders if a project requires an environmental assessment or an environmental impact statement pursuant to the National Environmental Policy Act (NEPA). 4.2 Obtaining Approvals to Construct and Operate Transmission Lines and Associated Facilities Certificate of Public Necessity and Convenience (CPCN) In California, an IOU must obtain a CPCN from the CPUC for the construction and operation of any elec-
tric power line facilities, substations or switchyards designed for immediate or eventual operation at volt- ages between 50 kV and 200 kV, or 200 kV or more. GO 131-E provides exemptions for the following: • replacement of existing transmission lines or sup- porting structures; • minor relocation of existing transmission line facili- ties; • conversion of existing overhead lines to under- ground; and • placing new or additional conductors, insulators or accessories to existing structures. Permit to Construct Pursuant to GO 131-E, a Permit to Construct is required for the extension, expansion, upgrade or modification of existing electrical transmission facili- ties, except where an exemption applies from Section III(B)(2) or if a utility files a CPCN application. Regulatory Process Once an entity files a CPCN or Permit to Construct application, the CPUC assigns an administrative law judge, and a two-track parallel proceeding begins. The first track is the environmental review, pursuant to CEQA. The second track is the review of the pro- ject’s need and cost, pursuant to the California Public Utilities Code Section 1001 and GO 131-E. The CEQA phase allows for public participation through public meetings and written comment periods. For the determination-of-need phase, an administra- tive law judge oversees the process, and parties are permitted to provide input in the proceeding, includ- ing through written testimony and evidentiary hear- ings. At the end of the process, the CPUC approves or denies the application, based on the contents of the final environmental impact report and the record developed during the determination of the need phase of the proceeding. 4.3 Terms and Conditions Imposed on Approvals to Construct and Operate a Transmission Line and Associated Facilities In California, the common terms and conditions in CPUC approvals to construct and operate transmis- sion lines and associated facilities include:
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