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Please provide your organization's comments on the Draft 2025 Participating Transmission Owner Per Unit Cost Guides:
Energy Division Staff of the California Public Utilities Commission (CPUC Staff) develops and administers energy policy and programs to serve the public interest, advises the CPUC, and ensures compliance with CPUC decisions and statutory mandates. Staff provides objective and expert analyses that promote reliable, safe, and environmentally sound energy services at just and reasonable rates for the people of California.[1] Further, Staff advocates on behalf of California ratepayers at the Federal Energy Regulatory Commission (FERC), under whose jurisdiction CAISO’s transmission planning falls. CPUC Staff appreciates this opportunity to comment on the May 8, 2025 Participating Transmission Owner Per Unit Cost Meeting and the published Draft Cost Guides. For clarity, CPUC Staff’s comments are separated by comments to the CAISO and those to Participating Transmission Owners (PTO).
Comments and Questions to the CAISO
The Participating Transmission Owner Per Unit Costs Process did not occur in 2024. There continues to be significant and universa-l impacts to the transmission equipment market, with particular stresses on transformer and breaker components reported in this current year[2]. This CAISO Per Unit Cost Process is beneficial to stakeholders by requiring PTOs to directly report on their equipment and component cost estimates. CPUC Staff encourages the CAISO and PTOs to implement this Process on a yearly basis, as was the case from 2021 to 2023.
During the 2023 Per Unit Cost meeting and this 2025 meeting, multiple stakeholders commented, and requested improvement, on the inconsistencies across the PTOs’ Per Unit Cost Guides. PTOs have reported that not all Per Unit Cost Guides present just material costs, with some combining additional costs such as labor, overhead, AFUDC or other categories, with each PTO having its own escalation rates. CPUC Staff requests that the CAISO work with PTOs to break out costs by those same categories (i.e., materials and equipment, labor, overhead, AFUDC, and other) and provide further justification on the differing escalation rates. Additionally, CPUC Staff suggests the CAISO have PTOs provide brief explanations for any costs that have changed significantly from one year to the next, such as any increase or decrease of 5% or more.
Lastly, CPUC Staff requests the CAISO work with the PTOs to ensure all appropriate PTO subject matter experts are on these stakeholder calls to present, explain, and answer questions on the respective cost guide. This coordination and transparency are important for full participation of stakeholders.
Comments and Questions Directed to All Participating Transmission Owners
CPUC Staff requests clearer information on how each PTO develops its cost guide. Different explanations were provided where some PTOs pull project data and comparisons from the past while other PTOs did not provide any assumptions in the cost guide assumptions tabs. CPUC Staff requests a written explanation from each PTO outlining what data sources and what analysis is done to update each Per Unit Cost Guide published through the CAISO.
Most discussions during the presentations focused on general costs. With respect to interconnection, CPUC Staff requests a written explanation on how closely the Per Unit Cost Guides match actual costs when interconnection is implemented (with any reference to past project data or previous Per Unit Cost Guides).
Comments and Questions to GridLiance West
GridLiance West (GLW) representatives stated that, although there was no 2024 CAISO Participating Transmission Owner Per Unit Cost process, they had created their own internal 2024 cost guide. CPUC Staff respectfully requests that this version be shared with stakeholders.
Additionally, GLW stated during its presentation that it was experiencing an annual increase of approximately 10%. However, when comparing the published 2023 GLW Per Unit Cost Guide to the draft 2025 version, all equipment categories that include prices (i.e., ignoring “N/A” and Lump Sum figures) show a more than 20% increase (with 13 of the 28 showing a more than 100% increase across the two years). Please explain the discrepancy in what GLW’s 2025 Per Unit Cost Guide shows and the 10% annual increase that was stated during GLW’s presentation.
[1] More information about the CPUC Energy Division is available at: https://www.cpuc.ca.gov/about-cpuc/divisions/energy-division
[2] GridLiance West is reporting an average 149% increase in transformer costs between the 2023 and 2025 Per Unit Cost Guides. SCE is also reporting an average 48% increase in transformer costs across the same period. In the April 2025 Transmission Development Forum meeting, utilities reported a significant increase in lead times for transformer and circuit breaker components with SCE stating lead times have increased from 18 months to 36-48 months.
