[California Energy Commission Letterhead]


STATE OF CALIFORNIA

Energy Resources
Conservation and Development Commission




In the Matter of:                          )   Docket No. 99-AFC-5
                                           )
Application for Certification              )   THIRD REVISED
for the Otay Mesa Generating Project       )   SCHEDULING ORDER
[PG&E Generating]                          )   
___________________________________________)

I. BACKGROUND

On July 25, 2000, the Committee conducted a status conference to determine whether the existing schedule (The Committee's current schedule was issued May 25 as the Second Revised Scheduling Order. Due to delays in obtaining necessary information, Applicant previously agreed to extend the 12-month certification process) should be modified to allow more time to resolve concerns identified by the parties in their most recent Status Reports (On June 19 and 27, respectively, Applicant and Staff filed status reports indicating that additional information is required on gas pipeline capacity, which affects the resolution of issues related to power plant reliability, efficiency, and transmission system engineering. More information is also required to resolve issues concerning air quality, biological resources, and local infrastructure, including traffic and transportation impacts)

At the status conference, Applicant described efforts to complete its mobile offset package and to work with the San Diego County Air Pollution Control District (Air District) on implementation of Rule 27. The Air District's Preliminary Determination of Compliance (PDOC) was released on June 19. According to the schedule, Staff will file its air quality analysis in early August, approximately 45 days after the issuance of the PDOC. The parties indicated that several issues regarding air quality remain unresolved.

Applicant presented several alternative proposals for securing a reliable gas delivery commitment from SDG&E, as well as the possibility of interconnecting with the North Baja Pipeline Project proposed by Sempra Energy International and PG&E Gas Transmission. Intervenor Cabrillo Power (NRG) was concerned that its Encina power plant would be subject to increased curtailment events if the Otay Mesa project is served by SDG&E. The Committee advised NRG to file data requests to obtain information from SDG&E about potential curtailment and other related gas delivery issues. Intervenor Duke Energy indicated that it would continue to participate in these discussions. None of the parties provided a timetable for resolution of the issue.

The U.S. Environmental Protection Agency (USEPA) initiated a Section 7 (Endangered Species Act) consultation with the U.S. Fish & Wildlife Service (USFWS) on July 6. The USFWS has up to 90 days to conclude formal consultation with USEPA and another 45 days to prepare its Biological Opinion (BO). Applicant expects USFWS to complete the BO by early September.

Staff reported that USEPA may consider withholding the Air District's Final Determination of Compliance (FDOC) and/or Prevention of Significant Deterioration (PSD) permit until the USFWS issues the BO. This issue remains unresolved.


II. THIRD REVISED COMMITTEE SCHEDULE

Based on the delays described above, the Committee has revised the Committee Schedule as follows:


Key Event Date (2000)
PDOC issued by Air District June 19
Release of Air District's EIR on Rule 27 July 3
USEPA initiates Section 7 consultation
with US Fish & Wildlife
July 6
PDOC comment period ends July 24
Committee Status Conference July 25
EIR on Rule 27 comment period ends August 1
Staff issues PSA on air quality Early August
PSA workshops on air quality Mid August
Parties file Status Reports (No. 7) August 15
Applicant files AFC Supplement Late August
USFWS issues Biological Opinion Early September
CA Dept. of Fish & Game adopts BO 30 days after release of BO by USFWS
Parties file Status Reports (No. 8) September 12
Grading/drainage plan Unknown
FDOC/PSD permit Unknown
Gas reliability issues resolved Unknown
Staff's multi-disciplinary study on
gas reliability
End of September assuming resolution of
gas reliability issues
Staff's FSA is filed End of September assuming resolution of
pending issues
Status Conference Early October or sooner, if necessary


The revised schedule does not anticipate dates for evidentiary hearings because it would be speculative at this time. The Committee will entertain a motion to revisit the schedule after pending issues are resolved.

III. DIRECTION TO THE PARTIES

Staff is directed to file and serve a report on the outcome of discussions with the USEPA and the USFWS regarding the timeline for issuance of the Air District's FDOC and/or the PSD permit relative to issuance of the BO.

Applicant is directed to provide a cumulative impacts analysis that discusses the Air District's Rule 69 with the addition of the Otay Mesa project in the SDG&E gas delivery system, the potential use of fuel oil by the Encina and South Bay power plants, and the potential impacts on regional air quality.

Applicant is directed to file and serve a copy of a "Will Serve" letter, "Precedent Contract," or other regulatory equivalent that describes the relationship between Applicant and a natural gas supplier for a firm commitment to provide natural gas to the Otay Mesa project.

IV. INFORMATION

For information on public participation, please contact the Commission's Public Adviser, Roberta Mendonca, at (916) 654-4489 in Sacramento, or toll free at (800) 822-6228, or email: pao@energy.state.ca.us

Technical questions concerning the project may be addressed to Eileen Allen, the Commission Staff's Project Manager at (916) 654-4082, or email at: eallen@energy.state.ca.us

Legal or procedural questions should be directed to Susan Gefter, the Hearing Officer, at (916) 654-3893, or email at: sgefter@energy.state.ca.us

Media inquiries may be directed to Claudia Chandler, Assistant Executive Director for Media and Public Communications at (916) 654-4989, or email at: energia@energy.ca.gov

Information concerning the status of the project is available on the Energy Commission's Internet Webpage at:

www.energy.ca.gov/sitingcases/otaymesa



Date On-line: August 2, 2000



ENERGY RESOURCES CONSERVATION
AND DEVELOPMENT COMMISSION



ROBERT A. LAURIE, Commissioner
Presiding Member
Otay Mesa AFC Committee

ROBERT PERNELL, Commissioner
Associate Member
Otay Mesa AFC Committee




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