4.16 MANDATORY FINDINGS OF SIGNIFICANCE

CHECKLIST ISSUES

A) ENVIRONMENTAL QUALITY

As discussed in the above checklists, the project could degrade the quality of the environment. However, mitigation measures have been proposed in the Initial Study to reduce or eliminate all of the potentially significant impacts identified and discussed in checklists 4.1 through 4.15.

Conclusion

On the basis of information discussed under individual sections of this Initial Study, some degradation of the quality of the environment could potentially occur. However, the implementation of the mitigation measures proposed in this Initial Study, coupled with the appropriate mitigation monitoring, would reduce the impacts to less-than-significant levels.

B) LONG-TERM VERSUS SHORT-TERM IMPACTS

The power plant sites are presently committed to industrial uses, and such uses are expected to continue in the future, with or without divestiture. The project merely involves the transfer of the plants to new owners, with the resulting tendency of such new owners to increase generation at the plants within current permitted levels and extensive regulatory programs for environmental protection. Long term environmental goals would not be altered or adversely impacted by the project. Thus, the project would not achieve short term environmental goals to the disadvantage of long term goal.

Conclusion

Long-term environmental goals would not be altered or adversely impacted by the proposed divestiture. Therefore, there is no impact.

C) CUMULATIVE IMPACTS

In addition to the project proposed by Edison and addressed in this document, there are three categories of projects that are reasonably foreseeable and may impact the environment cumulatively with the Edison project. They are 1) the divestiture of power plant assets by Pacific Gas and Electric (PG&E), as proposed in PG&E's pending application (Application No. 96-11-020) to the CPUC, together with the anticipated second divestiture application from PG&E which will include four additional fossil fuel power plants and a geothermal plant; 2) other future power plants throughout California where applications have been filed (or are anticipated may be filed) with the California Energy Commission (CEC) to site power generating plants, or power plants that are either under construction currently or have received their certification from the CEC and are expected to start construction in the foreseeable future; and 3) local projects that could occur in the communities in which each of the power plants reside and that are located either adjacent to the facility or within reasonable proximity. These projects and their potential cumulative impacts are described below.

1. Divestiture of PG&E Power Plants

Pacific Gas & Electric Company’s divestiture application (Application No. 96-11-020) seeks to sell three fossil-fueled power plants. The power plants are Morro Bay, in the city of Morro Bay, San Luis Obispo County; Moss Landing, in the city of Moss Landing, Monterey County; and, Oakland, in the city of Oakland, Alameda County. The plants represent approximately 42% of PG&E’s natural gas and fuel oil fired generation assets. Combined, these facilities consist of 2,645 megawatts of generating capacity.

PG&E intends to submit an application to the CPUC by the end of 1997 to divest four additional fossil fuel plants and one geothermal power plant. The fossil fuel plants are: Contra Costa; Hunters Point; Potrero and Pittsburg. The Geysers geothermal power plant is located in Sonoma County. If these plants and all of the plants in the current application are sold, PG&E will have only one fossil fuel generating facility remaining, a plant at Humbolt Bay. Combined, the fossil fuel facilities consist of 3,482 net MWs of generating capacity, while the geothermal plant has a peak net of 680 MWs of generating capacity (which is declining over time).

Potential Cumulative Impacts

Although the issues and analysis for the PG&E power plants that are to be included in the second round application for divestiture may be similar to the issues and analysis for the current PG&E application, at this time the Proponent's Environmental Assessment (PEA) has not been completed nor submitted to the CPUC and, thus far, the project's potential impacts have not been analyzed. PG&E's initial application of three power plants are being examined in a separate Initial Study that is being prepared concurrent with this (Edison) Initial Study. That separate Initial Study indicates that PG&E's application will generate impacts similar to those of Edison's current application.

The power plants that are slated for divestiture by Edison and PG&E (in its current and future applications) will be sold at auction to new owners. It is anticipated that the new owners will have a tendency to increase generation at these plants. There are a number of reasons for this rationale that are outlined in Attachment C of the Initial Study. However, there is also considerable uncertainty and countervailing factors that make it infeasible to accurately predict the particular plants at which operations would increase as a result of divestiture or the amounts by which generation would increase at any particular plant (see Section 3, Approach to Environmental Analysis, in this Initial Study).

It is notable that increased generation at a power plant does not necessarily equate to increased emissions in light of the greater amount of emissions that are involved with start-ups or shutdowns from operating in a less constant mode. Furthermore, it is, anticipated that the demand for electricity will remain constant under divestiture. Because demand is constant, the cumulative availability of the Edison and PG&E power plants under new owners is likely to inhibit generation at any particular divested power plant. In addition, the PG&E plants to be divested are not in the same location or area(s) as Edison's. The impacts associated with divestiture are primarily site specific and would not result in synergy's or impacts on a cumulative basis. Therefore, cumulative impacts associated with PG&E's initial divestiture application and the power plants to be included in PG&E's future divestiture application would be less than significant.

2. Future Power Plant Development

Current and Certified Power Plant Developments

Information provided by the CEC lists 3 power plants that are either under construction at the present time or have the necessary certification to construct pending final siting and issuance of local building permits. They are Campbell Soup, Campbell Company, Sacramento County (158 MW); ARCO-Watson, ARCO Products Company, Carson, Los Angeles County (45 MW); and San Francisco Energy Company, San Francisco City and County (240 MW). These are further described below.

• Campbell Soup is under construction by Campbell Company. It is a natural gas fired Cogeneration power plant with a generating capacity of 158 MW located in Sacramento County. The power plant includes transmission line modifications and a substation to connect to the existing transmission system. The construction of the plant is about 95% complete. The start-up management has been selected and mobilized. The estimated date for construction to be completed is October, 1997.

• ARCO-Watson is being developed by ARCO Products Company. The Company has requested an amendment to the ARCO-Watson Cogeneration Project decision to expand the 385 MW capacity of its cogeneration plant by 45MW. The expansion is to be at the ARCO-Watson refinery in Carson. The expansion involves the construction and operation of a fifth natural gas fired turbine and heat recovery steam generator. ARCO-Watson has filed an amendment request to the ARCO-Watson Cogeneration Project Decision which will be heard by the CEC on September 24, 1997. ARCO proposes to start construction on October 1, 1997. After CEC approval, construction typically takes one and a half years for projects of this type.

• San Francisco Energy is proposed to be built by the San Francisco Energy Company. It is intended to be a combined-cycle cogeneration plant capable of generating up to 240 MW. The facility would generate electricity and steam using natural gas as the sole fuel source. The proposed project is a result of a solicitation by PG&E in which the Company was declared the winner in 1994. San Francisco Energy is evaluating two sites in the Bayview-Hunters Point area of San Francisco. Final site plans and agreements have not been completed. There is no announced date for construction to commence, and the San Francisco Board of Supervisors issued a Resolution in 1996 opposing the siting of this power plant.

Plants with Pending Applications

Information provided by the CEC lists five potential power plant siting cases. They are: Otay Mesa, San Diego County (660-700 MW); Sutter Power, Sutter County (480-500 MW); Pioneer, Livingston, Merced County (113 MW); High Desert, Victorville, San Bernardino County (680-830 MW); and Mobil Belridge, Kern County (166-177 MW).

• Otay Mesa is proposed by US Generating, Inc., an unregulated affiliate of PG&E It would be a merchant power plant with a generating range of 660 to 700 MW to be located in southern San Diego County near the Mexico border. The facility is proposed to be a four unit gas-fired peaking project. The Project Proponent may convert the plant in the future to a combined cycle plant and is planning the electric transmission line size and circuitry to be able to handle either peaking loads or a combined cycle's more continuous operating profile. US Generating plans to file its Application for Certification (AFC) with the CEC in the near future.

• High Desert is proposed by Inland Energy and Constellation Energy. It would be a natural gas fired merchant power plant located at the California International Airport formerly known as George AFB near Victorville in San Bernardino County. The project may be a peaker, or a baseload combined-cycle plant, or a combination of both. An electric transmission line, natural gas pipeline and water and waste pipelines will be required. The AFC was filed on June 30, 1997. Staff recommendations to the CEC were heard on August 13, 1997 and the applicant was asked to submit additional information. Upon receipt of this information, the CEC will have 30 days to determine whether the AFC is complete.

• Sutter Power is proposed by the Calpine Corporation. It would be a natural gas fired merchant power plant in Sutter County at the same site as the company's existing Greenleaf Unit No. 1, located near Yuba City. The project will require construction of ancillary facilities including a new natural gas pipeline and a 230 KV transmission line. Calpine expects to file its AFC in the near future.

• Pioneer (aka Livingston) is proposed by Mock Energy, the Merced Irrigation District, the Turlock Irrigation District, Foster Farms and General Electric. It would be a combined cycle plant adjacent to the Foster Farms processing plant in the City of Livingston in Merced County. The project will serve as a commercial demonstration of the GE Kalina Cycle technology. The process uses a mixture of water and ammonia in the bottoming cycle to more efficiently convert gas turbine waste heat into electricity. The project will require up to nine miles of new or improved natural gas pipeline. The applicant plans to file its AFC in the Fall of 1997.

• Mobil Belridge is proposed by US Generating (an unregulated affiliate of PG&E) and Nations Energy. The project would be a thermally enhanced oil recovery facility located in the Belridge oil field. The site is located off Lost Hills Road near Highway 33 in Kern County. The project will require the construction of ancillary facilities, including a natural gas pipeline connection with an existing line and a 230KV transmission line to interconnect with the PG&E Morro Bay-Midway line. In addition, steam, water and wastewater lines will need to be constructed to support the plant. The applicants expect to reach a decision on whether to file an AFC in the latter part of 1997 (Haussler, 1997).

These power plants are in the early stages of application development and review. On average, permitting takes from 2-3 years before construction may start. It is unknown at this time which of these power plants, if any, will ultimately be fully permitted and built. However, it is reasonably foreseeable that one or more will ultimately be constructed.

Potential Cumulative Impacts

These potential future power plants, once constructed, are not expected to have cumulative impacts with the project. Demand for electricity in California is not expected to significantly increase. The cumulative effect of new plants (if built) would likely inhibit the tendency of the new owners of divested plants to increase operations at individual plants because new plants would tend to increase electrical generation capacity in California. The new proposed plants would employ the latest in generating and pollution control technology and may be cleaner to operate so that they would have lower emissions. This would provide a potential positive net benefit to the environment, particularly with respect to air quality. Therefore, the cumulative impacts associated with future potential power plants and the project would be less than significant.

3. Local Cumulative Projects

There is the potential for the divestiture project, together with projects that are planned for the local communities in which a particular power plant resides, to result in cumulative impacts. This section analyzes the potential for cumulative impacts in the local communities utilizing the same checklist items from the Initial Study. The following projects have been identified by the Planning and Community Development departments for the communities surrounding the power plants. The list shows current and proposed development projects within a 1-mile radius of the plants.

LAND USE AND PLANNING

The various projects are under consideration for approval from the community planning agencies and will be accepted or rejected based on their individual compliance with local planning and zoning regulations and policies. Each of the plants to be divested is consistent with the planning and zoning regulations that pertain within the local jurisdiction. The project would not result in cumulative impacts on land use and planning with the proposed projects.

POPULATION AND HOUSING

The list of projects includes many projects that will have incremental effects on community growth and housing. However, the divestiture project will not likely generate additional population or give rise to housing demand, and will thus have no effect cumulatively with these projects.

GEOLOGIC PROBLEMS

The project will not alter the geologic conditions or hazards existing on or near the power plant sites. The local projects and divestiture of the power plants do not have any synergistic or cumulative impact on geologic conditions.

WATER

Although many of the projects will have some effect on water demand, the existing basin adjudication agreements result in no cumulative effect with the divestiture project on groundwater supply. The divestiture project will have essentially no impact on erosion or runoff, so no cumulative impact with local projects would be expected. There are no water quality discharges from the local projects that would commingle or otherwise affect the discharges from the divestiture project. Therefore, no cumulative impacts on water resources are anticipated.

AIR QUALITY

The incremental air quality effects of this project stems from an unquantifiable tendency for new owners to operate the plants at higher levels. As discussed in Section 3, it is not feasible to predict how this tendency might manifest itself at particular plants. Given this uncertainty, and the fact that new owners will be constrained to operate within the existing air quality permits and regulations, this project does not have impacts that would be considered cumulatively considerable.

TRANSPORTATION AND CIRCULATION

Transportation and circulation impacts from the divestiture project, if any, are negligible. The incremental impacts of the project would pose no cumulatively considerable impacts when considered with community projects.

BIOLOGICAL RESOURCES

As mitigated, the impact of divestiture on local sensitive habitats would be insignificant, and the local projects are not expected to affect these habitats in a way that would produce significant impacts in combination with the project.

ENERGY AND MINERAL RESOURCES

All of the community projects will consume some energy and mineral resources for construction and for operation. However, neither the divestiture nor the local community projects would conflict with any adopted energy conservation plans, are anticipated to be wasteful or inefficient, or would affect known mineral resources. Therefore, there would be no significant cumulative impacts.

HAZARDS

The project was found to pose less than significant impacts to the environment with respect to risks of accidental explosion or exposure of people to potential health hazards. The hazards associated with the project would not interact cumulatively with the local community projects. Therefore, there would not be any significant cumulative projects.

NOISE

Noise from the project was found to be less than significant. Although there are local community projects planned for the vicinity of some of the plants, the noise from construction and operation of the community projects would be sufficiently distant from any particular plant so as not to measurably raise decibel levels. Since the incremental effects of the project are not considerable when viewed in connection with the proposed community projects, the project, together with cumulative projects, would pose less than significant cumulative impacts.

PUBLIC SERVICES

It was determined that there are less than significant impacts to local public services as a result of divestiture. Although the local community projects would require additional public services, the minor potential impacts from the divestiture project would not be expected to additionally burden public services substantially more than the needs for the community projects. Since the incremental effects of the project are not considerable when viewed in connection with the proposed community projects, cumulative impacts would be less than significant.

UTILITIES AND SERVICE SYSTEMS

The divestiture was found to have negligible impacts on utilities and service systems, if any. Although the local community projects would place additional demands on utilities and service systems, the minor potential impacts from the divestiture project would not be expected to additionally burden these systems substantially more than the needs for the community projects. In particular, the projects incremental effects would not be considerable when viewed in conjunction with the community project's. Therefore, cumulative impacts would be less than significant.

AESTHESTICS

Because the physical modifications of the project are minor, such as new fences within industrial areas, the project will have a less than significant impact on local aesthetics and vistas and scenic highways. Although the local community projects may have some effects on aesthetics, the divestiture project's affects are so minor that they would not cumulate with those of the other projects.

CULTURAL RESOURCES

The minor construction projects (e.g., fences and soil remediation) that could result from the divestiture project may potentially impact currently unknown subsurface archaeological and paleontological resources. Mitigation methods are proposed to fully mitigate impacts should they occur. It is possible that the local community projects may also impact cultural resources. However, since the divestiture project impacts would be fully mitigated and the impacts of the local community projects could be (and likely would be) similarly mitigated, no cumulative impacts would be expected.

RECREATION

The divestiture project may result in a slight increase in employment, and correspondingly demand for recreational facilities, at plants where new owners increase operation of the plants. There would be no cumulative significant impacts on recreation supply and demand.

Conclusion

Divestiture has no impact or a less than significant impact on the following environmental issues: land use and planning, population and housing, geology, water, transportation, energy and mineral resources, hazards, public services, utilities and service systems, noise, aesthetics, and recreation. With the mitigation measures proposed, there are less than significant impacts to air quality, biologic resources, and cultural resources as a result of divestiture. The local community projects are not anticipated to affect these resources in a manner that would create significant impacts in combination with the project. Therefore, and in light of the foregoing analysis, the cumulative impacts are less than significant.

D) EFFECTS ON HUMAN BEINGS

As discussed in the above checklists, the project could result in substantial adverse effects on human beings. However, with the proposed mitigations and mitigation monitoring all potentially significant impacts are reduced to less than significant.

Conclusion

On the basis of the information and the analysis discussed under the individual checklists and summarized above, the potential effects on human beings would be less than significant as a result of divestiture.