S-MAP 2: R. 20-07-013
Order Instituting Rulemaking to Further Develop a Risk-Based Decision-Making Framework for Electric and Gas Utilities- R.20-07-013
History and Background
The California Public Utilities Commission opened this proceeding through an Order Instituting Rulemaking (OIR) adopted on July 16, 2020. This proceeding (R.20-07-013) will build on requirements for the utility risk assessment and mitigation framework adopted in the Safety Model Assessment Proceeding (S-MAP), A. 15-05-002 et al, and in R.13-11-006, the Risk-Based Decision-Making proceeding.
Phase 2 of this proceeding modified the Risk-Based Decision-Making Framework (RDF) adopted in Decision (D.) 18-12-014. Within Phase 2, D. 22-12-027 replaced the “Multi-Attribute Value Function” (MAVF) with a Cost-Benefit Approach that includes standardized dollar valuations of Safety, Electric Reliability and Gas Reliability Consequences from Risk Events. This modification simplifies the RDF calculations the Commission requires from the electric and gas investor-owned utilities (IOUs), as shown in the following hypothetical examples:
Table A: Use of MAVF Approach to Calculate a Risk Score
|
Attributes |
Natural |
Value |
Lower |
Upper |
Percent of |
Scaling |
Scaled |
Weight |
Weighted |
|
Safety |
Fatalities |
20 |
0 |
100 |
20% |
Linear |
20 |
50% |
10 |
|
Reliability |
CMI |
500minutes |
0 |
2billion |
25% |
Linear |
25 |
25% |
6.25 |
|
Financial |
Dollars ($) |
$1billion |
$0 |
$2billion |
50% |
Linear |
50 |
25% |
12.5 |
|
Total Weighted Risk Score |
28.75 |
||||||||
Table B: Use of Cost-Benefit Approach to Calculate a Monetized Risk Value
|
Attributes |
Natural |
Valuea |
Scaling Function |
Dollar |
Monetized |
|
Safety |
Fatalities |
20 |
Linear |
$10 M/fatality |
$200 M |
|
Reliability |
CMI |
500 minutes |
Linear |
$2.50 M/CMI |
$1.25 B |
|
Financial |
Dollars ($) |
$1billion |
Linear |
$1 |
$1B |
|
Total Monetized Risk Value |
$2.45 B |
||||
* The Dollar Value of Attributes is also referred to as the Trade-off Value.
** Monetized Risk Value = Value x Dollar Value of Attributes.
This shift from the MAVF to the Cost-Benefit Approach provides for greater clarity and transparency when assessing risks and mitigations. D.22-12-027 requires the IOUs to implement the modified RDF to assess and rank risks and mitigations in their Risk Assessment and Mitigation Phase (RAMP) and General Rate Case (GRC) filings, starting with Pacific Gas and Electric Company’s (PG&E) 2024 RAMP filing.
Roadmap of Topics for Phase 3 issued on March 13, 2023
Prehearing Conference held on April 11, 2023
Phase 3 Scoping Memo issued on May 31, 2023
Phase 3 Ruling Updating Procedural Schedule issued on August 9, 2023
Phase 3 Scoping and Ruling Updating Schedule issued on October 13, 2023
Phase III Schedule
Workshop #6 December 6, 2023, Tail Risk: Non-Wildfire Risks and Granularity of Tranches
Workshop #6 Planning Questions (November 15, 2023)
Sempra Companies Party Whitepaper on Tail Risk (November 22, 2023)
Joint Utility Whitepaper on Tail Risk (November 22, 2023)
TURN Party Proposal on Granularity of Tranches (November 22, 2023)
Joint Utility Proposal on Granularity of Tranches (November 22, 2023)
Workshop #5 October 25, 2023, Discount Rates and RAMP Reporting Templates
Workshop #5 Planning Questions (October 5, 2023)
CalAdvocates Party Proposal on Risk Mitigation Reporting Templates (October 11,2023)
CalAdvocates Draft Reporting Template (October 11,2023)
TURN Party Proposal on Discount Rates (October 11,2023)
SPD Party Proposal on Discount Rates (October 11,2023)
CalAdvocates Final Version of Reporting Template (October 31, 2023)
Workshop #4 October 4, 2023, Risk Scaling **Possible additional date of October 6, 2023, if needed.
Workshop #4 Planning Questions (September 14, 2023)
TURN Party Proposal on Risk Scaling (9/22/2023)
PG&E Proposal on Risk Scaling – A market-based Approach (9/22/2023)
PG&E Proposal Risk Scaling Model (9/22/2023)
Workshop #3 September 13,2023, Climate Change
Workshop #3 Planning Questions (August 23, 2023)
SPD Staff Proposal on Climate Change and the Risk-based Decision-making Framework
PG&E Whitepaper on Integrating Enterprise Risk Modeling and Climate Vulnerability Assessment to Enhance IOU Resilience
Workshop #2 July 26, 2023, Tail Risk: Consequence Modeling
Workshop #2 Planning Questions (July 5, 2023)
Mussey Grade Road Alliance Tail Risk Pre-Workshop White Paper (July 13, 2023)
Workshop #1 July 12, 2023, Evaluation of Post-Test Years & Uncertainty: Transparency
Workshop #1 Planning Questions (June 21, 2023)
SPD Post-Test Years Pre-Workshop Proposals (June 28, 2023)
SPD Transparency Pilot Key Observations Pre-Workshop Report (June 28, 2023)
The issues to be determined in Phase II of this proceeding will be revisited at the conclusion of Phase I and may be further outlined in a second Scoping Memo. The issues to be considered will broadly include refining the RDF, considering a risk tolerance standard, and developing next steps.
TWG #5 August 18, 2022 The main purpose of this Technical Working Group session is to provide a platform for PG&E and SCE to present and discuss concerns regarding Phase II Staff Proposal recommendations.
Level 4 Ventures White Paper (as referenced during meeting)
Workshop #2 June 29, 2022 Technical Working Group Safety Policy Division (SPD) staff will present an initial draft set of Staff Proposal recommendations to the parties regarding the Phase II subset of issues in (R.)20-07-13.
TWG #4 June 16, 2022 Technical Working Group Presentation and Discussion where parties will develop the details of implementation for the Level 4 Recommendation identified as “Risk Modeling 3,” and parties will discuss the following scoping memo question: “Should the Commission consider impacts on environmental and social justice communities, including the extent to which action in this proceeding impacts the achievement of any of the nine goals of the Commission’s Environmental and Social Justice (ESJ) Action Plan?”
TWG #3 June 2, 2022 Technical Working Group Presentation and Discussion to develop the details of implementation of Level 4 Recommendation identified as "MAVF 3"
TWG #2 May 20, 2022 Technical Working Group Presentation and Discussion to develop the details of implementation of Level 4 Recommendation identified as "MAVF 2"
TWG #1 April 20, 2022 Technical Working Group Presentation and Discussion of Level 4 IOU Baseline Assessment Revised Recommendations
Level 4 Recommendations Report
Workshop #1 - March 3, 2022 - Presentation of the Level 4 IOU Baseline Assessment
Risk Spend Efficiency Assessment - IOU Baseline Assessment
Workshop Model: Risk Spend Efficiency Model
Workshop Model: Randarray
Workshop Model: Dynamic Array RSE
Workshop Model: RSE Multiple Libraries
Workshop Model: Filtered Risk Rollup
Workshop Model: Wheels of Misfortune
Track 1: Clarifying Risk Decision Framework (RDF) Technical Requirements
o Track 1 will consider whether there are discrete technical questions regarding the RDF that the Commission should clarify in the short term (larger, more substantive revisions to the RDF will be considered in Phase II).
August 18, 2021 Technical Working Group
July 28, 2021 Technical Working Group
Joint IOU's Slide Presentation
CalAdvocates' Slide Presentation
July 16, 2021 Technical Working Group
Joint IOU's Slide Presentation
Cal Advocates' Slide Presentation
June 22, 2021 Technical Working Group
May 6, 2021 Technical Working Group
April 14, 2021 Technical Working Sub-Group
March 10, 2021 Technical Working Group
February 3, 2021 Technical Working Group
December 15, 2020 Workshop
· Agenda
Track 2: Safety and Operational Metrics
o Track 2 will consider safety and operational performance metrics and their application broadly. This work will include refining metrics adopted in D.19-04-020 and developing new metrics as needed. Work on metrics will address D.20-05-053, which approved PG&E’s reorganization plan and directed the development of safety and operational metrics for PG&E linked to an Enhanced Oversight and Enforcement Process.
August 19, 2021 Technical Working Group
Revised Safety Performance Metrics
May 4, 2021 Technical Working Group
Secondary Master Table Slide Presentation
April 1, 2021 Technical Working Group
January 28, 2021 Workshop
Track 3: Refining RAMP and Related Procedural Requirements
o Track 3 will focus on whether there are RAMP, general rate case (GRC) and Risk Spending Accountability Reports (RSAR) procedural or definitional requirements that the Commission should refine or clarify.
February 9, 2021 Workshop
Track 4: Small and Multi-Jurisdictional Utilities (SMJUs)
o Track 4 will consider questions unique to the SMJUs - To occur at a future date
Agenda
Workshop Recording
Master Slide Presentation