Happy New Year and welcome to the January 2011 edition of the California Public Utilities Commission's (CPUC) eNewsletter, where you'll find information on a new Small Business Advisory Council, Time of Use Rates, a new power plant for the City of Oakley, and more.


CPUC Creates Small Business Advisory Council

The CPUC has created a Small Business Advisory Council in order to provide a forum for the CPUC, the utilities, and members of the small business community to discuss CPUC policy and issues that affect small businesses.

The CPUC approved the creation of the Small Business Advisory Council for a three-year pilot program to ensure accountability and effectiveness. It will consist of nine representatives from the CPUC, small businesses, the California Small Business Association, the California Chamber of Commerce, and the state's utilities. It will meet quarterly, rotating between northern, central, and southern California.

Individuals interested in being appointed as a small business owner member or utility member on the Small Business Advisory Council may submit a letter of interest and a resume, including references, by no later than Feb. 15, 2011, to Marzia Zafar, CPUC Small Business & Community Outreach Group, 505 Van Ness Ave., San Francisco, CA 94102.

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Time of Use Rates Help Lower Peak Demand for Energy

Last month’s eNewsletter included information about agriculture customers in Pacific Gas and Electric Company’s (PG&E) service area transitioning from their current flat rates to time of use (TOU) rates. This article continues the discussion with more information on TOU rates.

The amount of electricity we use in California, and how much that electricity costs, varies based on the time of day and the time of year. California uses more electricity in the summer, when areas of the state hit high temperatures, and in the afternoon when it’s the hottest time of day and the busiest for many businesses.  Big differences between high demand and low demand make supplying the right amount of electricity challenging and expensive. Electricity cannot be stored effectively long-term, so it must be produced near to the time it is used.

One way to help the situation is to reduce the amount of electricity we use during peak times, because buying electricity is very expensive when all the inexpensive power is already being used, yet there’s more demand. Typically, California’s average usage is less than 40,000 megawatts of capacity.  But that amount jumps to over 50,000 megawatts on a hot day, which forces inefficient and very expensive generators to operate.

With TOU rates, if the price for energy is higher at peak times and lower at off-peak times, consumers receive a price signal to use less energy during peak times and shift some of their usage to off-peak hours. This price signal is also referred to as dynamic pricing.  Dynamic pricing refers to the true cost of generating electricity. One example of dynamic pricing is Peak Day Pricing, or PDP, which is a rate that includes a short-term rate increase during critical conditions. This is beneficial for all utility customers because the costs of building new power plants or relying on older, less-efficient power plants is eventually passed on to customers in their retail rates.

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Cal-Am's Regional Project Given Green Light

The CPUC has approved a request by California American Water Company (Cal-Am) to join with several local agencies on the Monterey Peninsula to form a public-private partnership to build, own, and operate a regional water desalination project called the Regional Project in order to solve the long-standing water supply deficit on the Monterey Peninsula.

This additional source water is needed to make up for water now taken from the Carmel River, which must stop by December 31, 2016, by Order of the California Water Resources Control Board. Under the Order, Cal-Am must reduce its diversions of water from the Carmel River annually and terminate all diversions by no later than December 31, 2016. This means a reduction of more than 2/3 of the water that Cal-Am currently draws from the Carmel River every year

Monterey County Water Resources Agency will own, construct, operate, and maintain the source water wells and raw water conveyance facilities to the desalination plant. Marina Coast Water District will own, construct, operate, and maintain the desalination plant and the product water conveyance facilities to the delivery point, which then becomes Cal-Am's intake point. Cal-Am will own, construct, operate, and maintain the pipeline, conveyance, and pumping facilities necessary to deliver the water to its customers. The Monterey Regional Water Pollution Control Authority will own, operate, and maintain the outfall for return of the brine to the sea.

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CPUC Approves PG&E Request for Oakley Power Plant

The CPUC has approved Pacific Gas and Electric Company’s (PG&E) purchase and sale agreement with Contra Costa Generating Station LLC for the Oakley Project, a new state-of-the-art natural gas-fired combined cycle facility that is expected to produce 586 megawatts of generation.

The CPUC determined that the Oakley project will help mitigate the risk of any capacity shortfall in 2016. In addition the project utilizes the latest technology from General Electric and is expected to be the most efficient power plant of its kind in California, helping to reduce gas usage and decrease greenhouse gas emissions by displacing generation from older, less efficient resources.

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Visit our Consumer Information Center for more assistance. Consumers with utility complaints can call our Consumer Affairs Branch at 1-800-649-7570.

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© 2011, California Public Utilities Commission. All rights reserved.
January 2011


Produced by the CPUC's News and Public Information Office and Business and Community Outreach, 415-703-1366, news@cpuc.ca.gov
505 Van Ness Ave., San Francisco, CA 94102.

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