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  • Long Term Procurement Planning: 2014 - 2024

    The Long-Term Procurement Planning (LTPP) proceeding is an umbrella proceeding where the CPUC considers all of its electric resource procurement policies and programs in an integrated manner. California’s three largest investor owned electric utilities – Edison, PG&E, and SDG&E – submit procurement plans every two years that project their resource needs and their action plans to meet those needs, over a ten-year horizon.  Pursuant to Assembly Bill 57 (Public Utilities Code Section 454.5), the CPUC establishes upfront standards for the utilities’ procurement activities and cost recovery by reviewing and approving their procurement plans prior to implementation.  This process obviates the need for the CPUC to conduct after-the-fact reasonableness reviews for procurement transactions that are in compliance with the approved procurement plans.

    The CPUC will utilize findings from its 2012 LTPP process to feed into planning for the 2014 LTPP.

     

    Background 

    In December 2013, the CPUC issued a Rulemaking to initiate the 2014 Long-Term Procurement Planning proceeding (LTPP).  Every two years the CPUC opens a proceeding to examine electricity resource needs for the rolling 10-year LTPP planning horizon.  The 2014 LTPP planning cycle will consist of multiple tracks covering 2014 – 2024: 

    System, Local, & Operational Flexibility 

    • Phase 1:  In 2014 the CPUC will undertake studies to determine overall system, local, and flexibility resource needs, i.e., new resources needed for the state’s entire electric demand, but not how those needs would be filled.
    • Phase 2:  In 2015 the CPUC will authorize specific resources (generation, demand-side programs, etc.) to fill any residual need from Phase 1, including authorized transmission and transmission-related infrastructure from the CAISO’s Transmission Planning Process which may offset some need determined in Phase 1.

    Utilities Bundled Procurement Plans

    Review of the utilities procurement plans for their bundled customer needs. 

    Procurement Rules & Other Issues 

    • Safety Considerations
    • Procurement Rules to Comply with SB 695 on the Cost Allocation Methodology
    • Procurement Rules to Encourage Competitive Solicitations
    • Combined Heat and Power (CHP) Targets
    • Regulatory Process for Procurement of Contracts of Greater than five years
    • Greenhouse Gas (GHG) Procurement Policy 

     

    On December 11, 2013, CPUC Staff distributed its Planning Assumptions and Scenarios for the 2014 LTPP, followed by workshops. In December 2013, the CPUC issued an email Ruling posing questions to parties on the Planning Assumptions and the CAISO’s Transmission Planning Process. On February 27, 2014, the CPUC issued a Ruling with the final Planning Assumptions.


     

    ORA Policy Position 

    In order to balance reliability concerns and encourage cost-effective electricity procurement that is consistent with the CPUC’s loading order to prioritize clean energy resources, ORA recommends that the CPUC consider the following policy recommendations for the 2014 cycle: 

    • Develop a Phase 1 schedule that allow adequate time to incorporate:
      • Procurement authorization from Tracks 1 and 4 of the 2012 LTPP.
      • Results from the CAISO’s 2013 – 2014 Transmission Planning Process. 
       
    • Incorporate stochastic modeling results into the operational flexibility modeling study in order to better predict random occurrence in the system.
    • Consider procurement rule issues beginning in 2015 given the CPUC’s Decision on the 2012 LTPP Track 3 procurement rules.
    • Initiate a stakeholder developed methodology to calculate the integration cost adder for intermittent resources.
    • Update GHG compliance procurement rules that could facilitate least-cost procurement to meet GHG targets.

    See ORA’s February 3, 2014 Comments on the scope of the 2014 LTPP.
    See ORA’s January 8, 2014 Comments responding to CPUC questions on Planning Assumptions.

    See ORA’s January 15, 2014 Reply Comments.


    Proceeding Status 

    The CPUC is expected to publish the 2014 LTPP proceeding schedule in spring 2014. 

    See the Proceeding docket. 


    Other Resources 

    ORA 2012 Long-Term Procurement Planning webpage  

    CPUC Long-Term Procurement Planning webpage