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Proposed Pio Pico Energy Center on CPUC agenda

The California Public Utilities Commission will discuss at its regular meeting on Wednesday the application from San Diego Gas & Electric to buy power from the proposed Pio Pico Energy Center.

The public hearing, slated for 9:30 a.m. in San Francisco, could result in a decision on the application, which has already received a tentative green light from a CPUC administrative law judge. The proposed decision by ALJ Hallie Yacknin in early January brought criticism from some environmental groups, who had in early 2012 cheered the CPUC decision to deny SDG&E's first application for an agreement with the proposed facility.

Pio Pico Energy Center is proposed to be a 305-megawatt natural gas-fired "peaker" power plant in Otay Mesa, meant to be in operation only during periods of high demand at the calling of the California Independent Systems Operator. SDG&E's updated application followed the decision of Southern California Edison to shutter the San Onofre Nuclear Generating Station, which at the time of SDG&E's earlier denial from the CPUC was expected to be brought back online.

The CPUC at the time said Pio Pico's energy would not be needed regionally until a few years after its developer, Apex Power Group, had proposed it be built and placed online.

The Environmental Health Coalition, California Environmental Justice Alliance and the Sierra Club Beyond Coal Campaign have said the plant's projected $1.6 billion price tag would be too expensive and too taxing on the environment. The groups have advocated for renewable sources of energy to replace San Onofre, such as wind or solar energy.

SDG&E spokeswoman Stephanie Donovan said the gap can't be replaced by solar and wind alone, which are intermittent sources, saying that the region experiences a mini-peak in demand after the sun sets in the evenings.

In her proposed decision, Yacknin commented on the Sierra Club and California Environmental Justice Alliance arguments that the power purchase tolling agreement isn't reasonable "because some or all of the identified need could be met with demand response or energy storage resources."

That argument, Yacknin wrote, "constitutes an impermissible collateral attack on D.13-03-029’s determination that SDG&E should procure up to 298 MW of local generation capacity to come online beginning in 2018."

In its latest application, the purchase agreement between SDG&E and Pio Pico would begin June 1, 2017, instead of May 27, 2014 as was proposed in the original application. The terms of the agreement were also changed in the new application, making it span 25 years instead of 20 years.

Mike King, principal at Apex Power Group, said if the agreement is approved by the CPUC Wednesday, his group hopes its general contractor, Kiewit Corp., can break ground by April and be done with construction after about 18 months.

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