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STATE OF CALIFORNIA ARNOLD SCHWARZENEGGER, Governor
PUBLIC UTILITIES COMMISSION
505 VAN NESS AVENUE
SAN FRANCISCO, CA 94102-3298
December 4, 2003 Agenda ID #3052
TO: PARTIES OF RECORD IN APPLICATION 01-10-011
RE: NOTICE OF AVAILABILITY OF PROPOSED DECISION REGARDING THE
GAS STRUCTURE AND RATES FOR PACIFIC GAS AND ELECTRIC COMPANY FOR 2004
Consistent with Rule 2.3(b) of the Commission's Rules of Practice and Procedure, I am issuing this Notice of Availability of the above-referenced proposed decision. The proposed alternate decision was issued by President Michael R. Peevey on December 4, 2003. An Internet link to this document was sent via e-mail to all the parties on the service list who provided an e-mail address to the Commission. An electronic copy of this document can be viewed and downloaded at the Commission's Website ( www.cpuc.ca.gov). A hard copy of this document can be obtained by contacting the Commission's Central Files Office [(415) 703-2045].
This is a proposed alternate decision to Administrative Law Judge (ALJ) Wong previously served to you. It will be on the Commission's agenda on December 18, 2003, along with the proposed decision of ALJ Wong. The Commission may act then, or it may postpone action until later.
When the Commission acts on the proposed decisions, it may adopt all or part of them as written, amend or modify them, or set them aside and prepare its own decision. Only when the Commission acts does the decision become binding on the parties.
As set forth in Rule 77.6, parties to the proceeding may file comments on the enclosed alternate order no later than 5pm on December 11, 2003. An original and four copies of the comments with a certificate of service shall be filed with the Commission's Docket Office and copies shall be served on all parties on the same day of filing. Anyone filing comments shall electronically serve those on the service list who have provided electronic addresses. Parties shall also ensure that they electronically serve their comments on President Peevey's energy advisor, Roosevelt Grant, at email@example.com and assigned ALJ Wong, at firstname.lastname@example.org. For those who have not provided electronic addresses, printed copies of the comments shall be served by first class mail or another expeditious mode of delivery. No reply comments will be accepted.
/s/ ANGELA K. MINKIN
Angela K. Minkin, Chief
Administrative Law Judge
COM/MP1/rg1/acb DRAFT Alternate Agenda ID #3052
Decision PROPOSED ALTERNATE DECISION OF PRESIDENT PEEVEY
BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA
Application of Pacific Gas and Electric Company Proposing a Market Structure and Rules for the Northern California Natural Gas Industry for the Period Beginning January 1, 2003 as Required by Commission Decision 01-09-016. (U 39 G)
(Filed October 8, 2001)
OPINION REGARDING THE GAS STRUCTURE AND RATES
FOR PACIFIC GAS AND ELECTRIC COMPANY FOR 2004
TABLE OF CONTENTS
I. Summary 22
II. Background 33
III. 2004 Gas Structure and Beyond 66
IV. Winter Reliability Standard and Winter Firm Capacity Requirement 3535
V. Transmission Services 5656
VI. Storage Services 8989
VII. Contract Extension and Open Season 117117
VIII. Operations and Balancing 131131
IX. Operating and Maintenance Exenses 200200
X. Capital Expenditures 210210
XI. Cost of Service 223223
XII. Demand Forecast 227227
XIII. Cost Allocation and Rate Design 242242
XIV. Contingency Rate Adjustments 394394
XV. PG&E Procurement Policy and Core Procurement Services 400400
XVI. Core Aggregation Transportation Service 415415
XVII. Interconnection Services 434434
XVIII. California Gas Transmission Risk Management Program 452452
XIX. Future Gas Market Structure and Rate Filings 456456
XX. Conclusion 457457
XXI. Comments on Proposed Alternate Decision 458458
XXII. Assignment of Proceeding 458458
OPINION REGARDING THE GAS STRUCTURE AND RATES FOR
PACIFIC GAS AND ELECTRIC COMPANY FOR 2004
Pacific Gas and Electric Company (PG&E) filed the above-captioned application on October 8, 2001. PG&E's application requested that the Gas Accord1 structure and rates for its gas transmission and storage system be extended for two more years (through the end of 2004) pending the resolution of PG&E's bankruptcy filing.
In Decision (D.) 02-08-070, we approved a settlement by the parties which extended the Commission-approved market structure, rates, tariffs, and terms and conditions of service for PG&E's transmission and storage system by one year. Under the settlement, the market structure for PG&E's gas transmission service was extended for the period from January 1, 2003 to December 31, 2003, and PG&E's gas storage service was extended for the period from April 1, 2003 to March 31, 2004. Due to the adoption of the settlement, the issues regarding the gas structure and rates for the period beginning January 1, 2004 were unresolved.
Today's decision resolves the gas market structure, rates, and terms and conditions of service for PG&E's natural gas transmission and storage system for 2004. PG&E and the other parties proposed for resolution a number of structural and policy issues, as well as cost and rate design issues. Appendix B of the decision lists a matrix of the issues addressed in today's decision.
PG&E proposed a $453,736,000 revenue requirement for 2004 for its gas transmission and storage systems.2 PG&E's proposed revenue requirement represents an increase of 7% over the Gas Accord revenue requirement for 2003 of $423,923,000 million. Today's decision adopts a revenue requirement for 2004 of $437,564,000.3 The adopted revenue requirement represents an increase of 3.22% over 2003 gas transmission and storage rates of $423,923,000.
Today's decision also addresses the various cost allocation and rate design proposals of PG&E and the other parties. Since this decision adopts a cost allocation and rate design methodology that is very similar to what was contained in the Gas Accord, we expect that the gas transmission and storage rates and charges will rise slightly, reflecting the 3.22% increase in the revenue requirement.