Article 5. Electrical And Gas Corporations of California Public Utilities Code >> Division 1. >> Part 1. >> Chapter 5. >> Article 5.
In addition to the requirements of Article 1 (commencing with
Section 1001) and any other provision of law, every electrical and
every gas corporation proposing to construct or modify any electric
or gas plant within the state, or line, or extension, which will in
the case of an electrical plant, line, or extension add generating
capacity in excess of 50 megawatts, or in the case of a gas plant,
line, or extension cost in excess of fifty million dollars
($50,000,000), or proposing to construct any electric or gas plant
out-of-state of which at least twenty-five percent (25%) of the costs
will be borne by the corporation, shall comply with this article.
Whenever application is made to the commission for
certification of an electric or gas plant, line, or extension subject
to this article, the commission shall appoint a construction project
board of consultants to evaluate the design, construction, project
management, and economic soundness of the proposed plant, line, or
extension, if the commission determines that a significant potential
exists for the occurrence of problems in any of the areas for which
an electrical or gas corporation is required to submit information
pursuant to Section 1003 or 1003.5. The extent of the board's
evaluation shall be determined by the commission. The board may, upon
approval of the commission, employ staff independent of the
commission staff to carry out its functions under this article. The
board may, upon approval of the commission, undertake special studies
addressing potential problem areas identified by the board.
(a) The construction project board of consultants shall
consist of eminently qualified and highly experienced design,
construction, and project management economic specialists who can, as
a group or as individuals, independently and objectively address the
full scope of design, construction, and project management and
economic evaluations requested by the commission.
(b) No member of the construction project board of consultants
shall have a current financial interest in, or receive any
significant amount of his or her annual compensation for consulting
services in his or her area of special expertise from, any
corporation or person which has a financial interest in the project.
The commission shall define financial interest and significant amount
of annual compensation for purposes of this subdivision. Any person
considered for appointment to the board shall disclose to the
commission any interests in the project or in any corporation or
person with a financial interest in the project and any compensation
received for consulting services which may constitute a prohibited
(c) Notwithstanding subdivision (b), a person appointed by the
Federal Energy Regulatory Commission as a member of a board of
consultants for the construction of a hydroelectric generation
facility or related transmission line who receives compensation from
an electrical corporation constructing that facility or line as a
member of that board of consultants is not disqualified from an
appointment to a construction project board of consultants pursuant
to Section 1092.
The members of the construction project board of consultants
shall receive fees and expenses from the commission. The corporation
whose project the construction project board of consultants is
evaluating shall, upon demand of the commission, reimburse the
commission for the amount expended by the commission for the fees and
other expenses of the board, including, but not limited to, special
studies, staff, or commission staff costs directly attributable to
activities of the construction project board of consultants.
The commission shall deposit all money received pursuant to this
section at least once each month in the Certification Fund, which is
hereby created in the State Treasury. The money in the Certification
Fund is hereby continuously appropriated to the commission in
augmentation of any other appropriation for the support of the board.
The commission may allow the inclusion of any amounts received
from an electrical or gas corporation pursuant to this section as an
authorized expense for purposes of establishing rates.
The corporation shall provide the construction project board
of consultants with all information the board determines necessary
for its evaluation of the project. The corporation shall provide
information regarding problems and uncertainties which have been
encountered during the planning, design, and development of the
The construction project board of consultants shall evaluate
the design, construction, project management, and economic soundness
of the project as directed by the commission, and submit an
appropriate written report of its findings and recommendations to the
commission and the corporation prior to the commission's issuance of
a certificate. The members of the board may provide testimony before
the commission in formal or informal hearings on the project.
(a) For purposes of assisting the construction project board
of consultants in monitoring project construction, the corporation
shall submit the current design, estimate of project costs,
implementation schedule, and draft construction contracts to the
commission and the construction project board of consultants before
awarding any major construction contract. The corporation shall
inform the commission and the board of all bid quotations and any
significant exceptions which the bidders may have taken to the
corporation's engineering designs, specifications, and draft
(b) The examination by the commission and the construction project
board of consultants of documents furnished pursuant to this section
shall be conducted so as not to unreasonably delay the contracts,
bidding, and awards process.
Throughout the design and construction process, the
corporation shall submit quarterly progress reports to the commission
and the construction project board of consultants on the status of
the project. The corporation shall provide complete information on
any major problems and deviations in the areas for which an
electrical or gas corporation is required to submit information
pursuant to Section 1003 or 1003.5.
The corporation shall provide the commission and the board with
reports each month containing the following information for each of
the major cost categories within the project and for the project as a
(a) The original estimated costs as of the time of certification.
(b) The actual costs to date.
(c) The percentage of the work completed to date.
(d) The estimated costs to completion.
(e) The costs associated with changes made by regulatory bodies to
the scope or design of the project.
If the actual costs to date or the estimated costs to completion
for any major cost category, or the project as a whole, exceed the
original estimated costs by 10 percent, the corporation shall advise
the board and the commission of this fact, and provide the commission
and the board with an explanation and a proposal for corrective
action. The commission shall consult with the board in determining
whether to order corrective action. The board shall submit quarterly
reports to the commission and to the corporation if it determines
that a potential for major problems exists.
Upon completion of the project and commencement of
operations, the construction project board of consultants shall
submit a final report of its findings and recommendations to the
commission and the corporation.
The commission and the corporation shall give full
consideration to all reports, findings, and recommendations of the
construction project board of consultants and provide a public
response in writing within 45 days after receiving the reports,
findings, and recommendations. Copies of the written reports of the
board containing its findings and recommendations shall be made
available to the public, at cost, at the same time that the reports
are issued to the commission and the corporation. The public shall
have 45 days from the date of issuance to respond, in writing, to the
commission on the reports.
No provision of this article shall be construed to relieve an
electrical or gas corporation of any responsibility for the
construction or modification of any electric or gas plant including
ultimate costs, cost control mechanisms, schedules, and completion
dates. Members of the construction project board of consultants,
individually or as a group, shall assume no responsibility for the
design, construction, project management, or any other part of a
plant construction or modification project.
(a) Notwithstanding any other provision of this article, and
in addition to the requirements of Article 1 (commencing with Section
1001), an electrical corporation proposing to construct an
electrical transmission line to the northwestern United States shall
provide the commission with sufficient reliable information to enable
the commission to determine that the proposed line, at the electric
rates expected to prevail over the useful life of the line, will be
cost effective. The commission, in its analysis of the forecast cost
of electricity, shall take into consideration the recent increases in
the charges for purchasing surplus electricity from the northwestern
United States, the possibility of future increases in those charges,
the feasibility of negotiating long-term contracts under reasonable
charges, and the feasibility of purchasing electricity directly from
Canada rather than through the Bonneville Power Administration.
(b) The commission shall not issue a certificate of public
convenience and necessity unless it is satisfied that the electrical
corporation has provided the information described in subdivision