Peevey Agenda Decision Would Make REC Limit on ESPs Retroactive

The agenda decision of California PUC President Michael Peevey, which would place a cap on tradable REC usage for RPS compliance by electric service providers, would retroactively apply this limit effective as of March 11, 2010 (the effective date of the earlier tradable REC decision, D.10-03-021), the Alliance for Retail Markets, Direct Access Customer Coalition, and several other parties said in a motion for a comment period on the agenda decision (R.06-02-012).

As noted yesterday, the agenda decision would also set the REC cap at 30%, and extend the cap through the end of 2013, rather than 2011.

"In light of the long-standing prohibition on retroactive rulemaking, any decision in that proceeding that extended the TREC usage limit to other classes of load-serving entities (LSEs) would presumably be effective on a prospective basis only. Consequently, the possibility that the TREC usage limit might be applied retroactively to ESPs was never even addressed in comments on the Original PD. The Revised PD's retroactive application of the TREC usage limit to ESPs is a radical departure from the original PD and raises unique legal and policy questions which the Commission has not previously considered in either this proceeding or R.08-08-009,"

As both proposed decisions in the case were issued by Peevey, an automatic comment period that applies to alternative proposed decisions does not apply; however, AReM said that parties should be given a reasonable opportunity to comment on the substantive changes in the agenda decision.

"In the interest of due process and to allow for due consideration of the potential impairment of commercial arrangements that ESPs and their customers may have made based on the existing RPS implementation rules that could result from adoption of the Revised PD, the Commission should provide parties a reasonable opportunity to comment and be heard on the issues of law and policy raised by the changes made to the Original PD in the Revised PD," AReM said.