> ## Content Index > Fetch the complete content index at: https://www.calregulatory.com/llms.txt > Use this file to discover other available public pages before exploring further. # CPUC JAN. 15, 2026 VOTING MEETING PREVIEW: SDG&E GRC Wildfire Costs; Non-IOU Provider of Last Resort Framework; PG&E Long-Duration Storage - URL: https://www.calregulatory.com/cpuc-january-15-2026-voting-meeting-preview-sdg-e-grc-wildfire-costs-non-provider-of-last-resort/ - Published: 2026-01-06T14:19:45.000Z - Updated: 2026-01-06T14:21:41.000Z - Author: MC - Tags: CPUC, SDG&E, Wildfire Mitigation Plan, Provider of Last Resort, CCAs, PG&E, Energy Storage, General Rate Case, O&M, cost-benefit ratio, Senate Bill 520, IOUs, mid-term reliability, ERRA, ERRA Compliance, SCE, hydroelectric, Portfolio Allocation Balancing Account, PABA, PCIA, data center, RD&D, bioenergy, CRPC, CPCN, PURPA The CPUC's **January 15, 2026** voting meeting [agenda](https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M594/K021/594021078.pdf?ref=calregulatory.com) carries $1.2 billion in capital decisions and two framework-setting items that may shape utility operations for years. Below are the proposed decisions and draft resolutions that are currently scheduled for consideration. - For SDG&E's wildfire-mitigation cost recovery, the CPUC disallows **$435 million** out of the $1.47 billion requested. An **ALJ Larsen** [proposed decision](https://docs.cpuc.ca.gov/PublishedDocs/Efile/G000/M587/K328/587328302.PDF?ref=calregulatory.com) calls for better documentation and cost-benefit analysis. Every California utility filing Wildfire Mitigation Plan costs should read this PD closely. - The [Provider of Last Resort](https://www.cpuc.ca.gov/consumer-support/consumer-programs-and-services/electrical-energy-and-energy-efficiency/community-choice-aggregation-and-direct-access-/provider-of-last-resort?ref=calregulatory.com) framework builds procedural infrastructure for a future that hasn't arrived. No CCA has sought full POLR designation, but when one does, the application pathway will exist, with financial security, insurance, and anti-cost-shifting requirements baked in. - A pair of PG&E energy-storage items illustrate the mid-term reliability squeeze: Balsam (225 MW, eight-hour) moves toward 2028 delivery while Nighthawk (300 MW) gets a second delay extension to avoid outright default. *If reports like this have been useful for you (or your team), please consider* [*becoming a paid subscriber*](https://www.calregulatory.com/pricing/) *in 2026\. Our Founder's Rate is available until *January 13* and locks members in at that price permanently (*[*$225/month*](https://www.calregulatory.com/pricing/#/portal/signup/69430ce436826b00018a9609/monthly) *or* [*$2,250/year*](https://www.calregulatory.com/pricing/#/portal/signup/69430ce436826b00018a9609/yearly)*). Team and enterprise packages are also available;* [*contact us*](https://www.calregulatory.com/contact-us/) *for assistance.* --- ### SDG&E GENERAL RATE CASE This [proposed decision](https://docs.cpuc.ca.gov/PublishedDocs/Efile/G000/M587/K328/587328302.PDF?ref=calregulatory.com) resolves SDG&E’s request to recover wildfire-mitigation costs recorded in its Wildfire Mitigation Plan Memorandum Accounts from May 2019 through 2022. SDG&E sought recovery of $284 million in O&M and $1.188 billionin capital, reflecting extensive grid-hardening, vegetation management, inspections, situational-awareness tools, and other wildfire-risk-reduction measures pursuant to post-2019 wildfire-mitigation legislation. - The PD finds some costs reasonable and aligned with mandated wildfire-risk reduction but disallows **$192.6 million** in O&M and **$242.4 million** in capital, citing insufficient support, cost-effectiveness concerns, and other deficiencies. The PD ultimately approves **$90.6 million** in O&M and **$945.2 million** in capital as just and reasonable. - The PD also addresses recovery of the undercollected revenue requirement associated with depreciation, taxes, and return on rate base for WMP-related assets through 2027\. After subtracting the $289.9 million in interim relief already collected (subject to refund), the PD authorizes **$430.9 million** in additional revenue requirement, amortized over three years to mitigate bill impacts on residential customers. - The PD rejects [TURN](https://www.turn.org/about-turn?ref=calregulatory.com)’s request to force SDG&E to refile the application but requires SDG&E to include cost-benefit ratios in future wildfire-cost-recovery filings. --- ### PROVIDER OF LAST RESORT This [proposed decision](https://docs.cpuc.ca.gov/PublishedDocs/Efile/G000/M590/K884/590884359.PDF?ref=calregulatory.com) establishes a procedural framework for how non-investor-owned entities may seek designation as a Provider of Last Resort under [Senate Bill 520](https://californiachoiceenergyauthority.com/senate-bill-520-sb-520-provider-of-last-resort-polr/?ref=calregulatory.com), without pre-judging eligibility criteria in the absence of a concrete applicant. (*Providers of Last Resort are the load-serving entity designated to supply electricity to customers when their chosen provider fails or exits the market*). The PD concludes that, because no non-IOU entity has expressed intent to assume full POLR responsibility for all customer classes in a geographic area, it would be inefficient and speculative for the Commission to resolve detailed substantive issues in advance. Instead, the PD adopts a streamlined, application-driven approach under which any prospective non-IOU Provider of Last Resort must submit a comprehensive application demonstrating compliance with Senate Bill 520’s minimum statutory requirements, including financial security, insurance, procurement compliance, technical and operational capacity, and protections against cost-shifting. The PD: - Clarifies that Provider of Last Resort obligations may not be divided by customer class; - Affirms that IOUs cannot veto a non-IOU Provider of Last Resort application but must participate in a joint filing process where feasible; and - Leaves questions regarding the scope of Commission regulatory authority to be resolved on a case-specific basis. --- ### PG&E LONG-DURATION STORAGE [Draft Resolution E-5437](https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M588/K929/588929861.PDF?ref=calregulatory.com) approves PG&E’s long-duration storage contract with the Balsam Project LLC for a 225-MW Dirac Battery Energy Storage System and an eight-hour lithium-ion facility expected online by **May 20, 2028** and delivering Resource Adequacy beginning **August 1, 2028**. The contract emerged from PG&E’s Long-Lead-Time Mid-Term Reliability solicitation and is intended to satisfy a portion of the utility’s long-duration storage obligations under the following decisions: [D.21-06-035](https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M389/K603/389603637.PDF?ref=calregulatory.com); [D.23-02-040](https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M502/K956/502956567.PDF?ref=calregulatory.com); and [D.25-06-005](https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M569/K671/569671981.PDF?ref=calregulatory.com). Costs will be recovered through the Portfolio Allocation Balancing Account and assigned a 2021 [Power Charge Indifference Adjustment](https://www.cpuc.ca.gov/industries-and-topics/electrical-energy/electric-power-procurement/power-charge-indifference-adjustment?ref=calregulatory.com) vintage. The draft resolution also affirms that the project meets updated eight-hour dispatch requirements. --- ### PG&E MID-TERM RELIABILITY [Draft Resolution E-5432](https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M590/K550/590550980.PDF?ref=calregulatory.com) approves PG&E’s request to further amend its Mid-Term Reliability contract with [Nighthawk Energy Storage, LLC](https://www.nighthawkenergystorage.com/?ref=calregulatory.com) (an [Arevon Energy](https://arevonenergy.com/?ref=calregulatory.com) affiliate) by extending the project’s required online date from June 1, 2025 to **June 1, 2026** and adjusting the contract price to reflect current market conditions. The Nighthawk project, originally approved in 2022 as part of PG&E’s Mid-Term Reliability procurement obligation, has faced successive delays due to interconnection challenges, permitting issues, supply-chain pressures, inflationary cost increases, and higher financing costs. Energy Division finds PG&E’s negotiated amendment reasonable, noting that absent this relief the developer would likely default, jeopardizing a **300-megawatt** storage resource essential to PG&E’s Mid-Term Reliability compliance. The Draft Resolution, which is redacted, concludes that the revised price remains competitive in the current market and that the project (now permitted, financed, and holding a CAISO interconnection agreement) has a credible path to meeting the amended June 1, 2026 delivery date. --- ### SCE ERRA COMPLIANCE This [proposed decision](https://docs.cpuc.ca.gov/PublishedDocs/Efile/G000/M590/K408/590408806.PDF?ref=calregulatory.com) finds that SCE’s 2022 Energy Resource Recovery Account procurement, generation management, and contract administration were largely compliant with CPUC standards and SCE's Bundled Procurement Plan. The PD authorizes recovery of **$51.442 million** in undercollected balances (mainly tied to the [Emergency Load Reduction Program](https://elrp.sce.com/?ref=calregulatory.com)), resulting in an estimated **$0.45/month** residential bill impact in 2026. SCE must remove CAISO sanctions from the ERRA/Portfolio Allocation Balancing Account because it failed to justify them and refund **$1.65 million** in double-charged franchise fees to departed customers via a 2026 PABA adjustment. --- ### HYDROELECTRIC ASSETS/LEGACY GENERATION EXIT This [proposed decision](https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M592/K712/592712378.PDF?ref=calregulatory.com) approves SCE’s sale of the Lytle Creek and Fontana hydroelectric plants to Fontana Union Water, finding the assets non-essential and the transaction in the public interest. Although the plants total just 3.45 megawatts, the PD authorizes recovery of **$9.5 million** in pre-tax losses through the Portfolio Allocation Balancing Account and Power Charge Indifference Adjustment, allocating costs to bundled and non-exempt departing load customers. --- ### DATA CENTERS [Draft resolution E-5439](https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M590/K889/590889612.PDF?ref=calregulatory.com) approves (with modifications) PG&E’s [request](https://www.pge.com/tariffs/assets/pdf/adviceletter/ELEC%5F7635-E.pdf?ref=calregulatory.com) to energize a new 90-megawatt Microsoft data center in San Jose through transmission-level upgrades, including new 115-kilovolt facilities and dedicated lines. The Draft Resolution finds the agreements necessary but determines that applying the standard [Electric Rule 15](https://www.cpuc.ca.gov/industries-and-topics/electrical-energy/infrastructure/electric-reliability/undergrounding-program-description/rule-20/cpuc-rule-20-undergrounding-programs-current-proceeding-r1705010/electric-tariff-rules-15-and-16-distribution-line-and-service-extensions?ref=calregulatory.com) refund framework without adjustment would pose undue risk to ratepayers due to the project’s size, transmission-level interconnection, and uncertainty around long-term revenue realization. To address this risk, the draft resolution modifies the Base Annual Revenue Calculation refund process by limiting annual refunds to 75% of PG&E’s actual net transmission revenues from Microsoft, with an adjustment for the Income Tax Component of Contribution, and extends the refund period from ten to fifteen years. Microsoft must pay actual construction costs and receives no refunds for special facilities it requested. The draft resolution emphasizes that this is an exceptional, non-precedential determination and directs PG&E to file conforming agreements. --- ### NATURAL GAS RESEARCH [Draft Resolution G-3618](https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M590/K877/590877312.PDF?ref=calregulatory.com) denies PG&E’s proposed Gas RD&D Investment Plans for 2024 and 2025 and rejects its request to recover **$7.2 million** in RD&D costs from 2023–2024\. Consequently, PG&E may not record RD&D expenses for these years. PG&E is directed to resubmit revised 2024 and 2025 plans within 60 days addressing the identified deficiencies. The draft resolution also establishes more prescriptive planning, coordination, and reporting requirements for future Gas RD&D plans beginning in 2026, and requires unspent funds to be returned to ratepayers at the end of the current GRC cycle. --- ### BIOENERGY This [proposed decision](https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M586/K161/586161556.PDF?ref=calregulatory.com) denies a [petition for modification](https://docs.cpuc.ca.gov/PublishedDocs/Efile/G000/M558/K427/558427287.PDF?ref=calregulatory.com) filed by the [Bioenergy Association of California](https://bioenergyca.org/?ref=calregulatory.com) to modify a 2020 CPUC decision ([D.20-08-043](https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M346/K112/346112503.PDF?ref=calregulatory.com)), which had extended the [Bioenergy Market Adjusting Tariff](https://www.cpuc.ca.gov/industries-and-topics/electrical-energy/electric-power-procurement/rps/rps-procurement-programs/rps-sb-1122-biomat?ref=calregulatory.com) program through **December 31, 2025**. --- ### CRPC/UNION ISLAND PIPELINE This [proposed decision](https://docs.cpuc.ca.gov/PublishedDocs/Efile/G000/M583/K958/583958837.PDF?ref=calregulatory.com) denies a [request](https://docs.cpuc.ca.gov/PublishedDocs/Efile/G000/M514/K688/514688334.PDF?ref=calregulatory.com) of California Resources Production Corporation for a Certificate of Public Convenience and Necessity to operate the 35-mile Union Island natural gas pipeline as a public utility gas corporation. The PD concludes that the company no longer holds valid franchise rights in Antioch and Brentwood and ceased transporting gas in 2023. --- ### PURPA [Draft Resolution E-5425](https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M588/K823/588823970.PDF?ref=calregulatory.com) approves, with modifications, PG&E’s and SDG&E’s proposed [PURPA](https://en.wikipedia.org/wiki/Public%5FUtility%5FRegulatory%5FPolicies%5FAct?ref=calregulatory.com)\-compliant export tariffs for customer-generators who lose Net Energy Metering or Net Billing eligibility due to prevailing-wage violations under the Public Utilities Code and a 2023 CPUC decision ([D.23-11-068](https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M520/K977/520977266.PDF?ref=calregulatory.com)). The draft resolution concludes that while the filings generally comply with the decision, an explicit 20-megawatt capacity limit must be added to align with PURPA’s mandatory-purchase rules and the 20-MW standard-offer framework in a 2020 Commission decision ([D.20-05-006](https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M337/K709/337709639.PDF?ref=calregulatory.com)).