Southern California Reliability Michele Kito CPUCs Energy Division

Southern California Reliability Michele Kito, CPUC’s Energy Division August 17, 2015 1

Long Term Procurement Plan (LTPP) • The LTPP authorizes new infrastructure to maintain system reliability • Looks forward 10 years to identify system and local needs • Considers alternative futures (renewable portfolio, demand supply, and transmission scenarios) • Updates procurement rules 2

2012 LTPP • Track 1 - D. 13 -02 -015 authorized SCE to procure electrical capacity in the West LA Basin & Moorpark sub-areas to meet long-term local capacity requirements. • Track 4 - D. 14 -03 -004 authorized additional procurement for SCE and SDG&E to meet local capacity needs stemming from the retired San Onofre Nuclear Generation Stations (SONGS). 3

Any Authorization Requires Balance of Operational Benefits Any resource authorization must balance capabilities No single resource can meet both reliability needs and state policy objectives alone Type Energy Efficiency[1] Demand Response Reactive Annual Expected power Capacity Availability support Factor On-Peak Dispatchable Inertia (VARS) Reduces total energy demand GHG-free Yes Low [2] 100% Yes No No Yes Combined Heat & Power 80% 100% Maybe Yes No Large Solar 24% 77% No No Maybe Yes Rooftop Solar 19% 45% No No No Yes Wind 33% 30% No No No [3] Yes Storage N/A 100% Yes No Maybe Yes Gas Peaker/CT 10% 100% Yes Yes No Gas Combined Cycle 65% 100% Yes No 4 [1] Energy efficiency is not traditionally measured as a capacity factor resource, and savings vary widely by application and use. [2] Demand response programs generally have low capacity factors due to typical usage limits of 100 hours or less per year. [3] Some renewable energy sources, notably wind, actually require additional VAR support.

SCE Authorization for LA Basin Resource Type Preferred Resources Minimum Requirement Energy Storage Minimum Requirement Gas-fired Generation Track 1 LCR Resources (D. 13 -02 -015) Additional Track 4 Authorization (D. 14 -03 -004) Total Authorization 150 MW 400 MW 550 MW -- 50 MW 1000 MW -- 1000 MW Up to 400 MW 100 to 300 MW 300 to 500 MW 500 to 700 MW 1900 to 2500 MW Minimum Requirement Optional Additional From Preferred Resources/Energy Up to 400 MW Storage Only Additional from any Resource 200 MW Total Procurement 1400 to 1800 Authorization MW

SDG&E Authorization Resource Type D. 13 -03 -029/ D. 14 -02 -016 Additional Track 4 Authorization (D. 14 -03 -004) Total Authorization Preferred Resources (including energy storage) Minimum Requirement --- 175 MW Energy Storage Minimum Requirement --- 25 MW 300 (Pio Pico) 300 to 600 MW 600 to 900 MW 300 MW 500 to 800 MW 800 to 1100 MW Additional from any resource Total Procurement Authorization

SCE Implementation Progress • • Application submitted Nov. 2014 (A. 14 -11 -012) for West LA Basin Overview of selected offers: Product Category Total Contracts Preferred Resources and Energy Storage Energy Efficiency 26 124. 04 Demand Response 7 75. 00 Renewable Distributed Generation 4 37. 92 23 263. 64 60 500. 60 3 1, 382. 00 123 1, 882. 60 Energy Storage – 100 MW IFOM and 164 MW BTM Total Preferred Resources and Energy Storage Gas-Fired Generation Total Preferred Resources, ES, and GFG • LCR MW Hearings completed, briefs submitted, PD expected (per Scoping Ruling), 90 days after submission, or approximately 10/1/2015 7

SDG&E Implementation Progress • Pio Pico (300 MW) approved in (D. 14 -02 -016) – Contract start date – June of 2017 • Carlsbad Energy Center (500 MW) approved in May of 2015 (D. 1505 -051) – Six applications for rehearing currently pending before the Commission • SDG&E’s 2014 All Source RFO – RFO issued – September 5, 2014 – SDG&E notified shortlisted bidders – June 5 , 2015 – SDG&E submits contracts to CPUC for approval – Q 1 2016 8

Contingency Contracts • • D. 14 -03 -004 allows submission of contingency contracts, but SCE and/or SDG&E, in their applications must address a number of questions posed by the Commission. SCE procurement authorization status – SCE has submitted an application to fill 1882 MW of total need – SCE will need to procure an additional 100 MW of preferred resources – SCE has authorization for an additional 518 MW (400 MW preferred resources/energy storage, the remainder from any source) • SDG&E procurement authorization status – SDG&E has received Commission approval for its 500 MW Carlsbad facility – SDG&E has authorization for an additional 300 MW of preferred resources/energy storage 9