3. PG&E's PDP Proposal

Under PG&E's proposal, the following rates will be effective May 1, 2010:

· For large C&I customers, default PDP rates that include TOU rates during non-peak periods; and

· For agricultural, small and medium C&I, and residential customers with advanced meters, optional PDP rates that include TOU rates during non-peak periods.

By February 1, 2011, PG&E proposes the following rates will be effective:

· For large agricultural customers that have had an advanced meter for at least 12 months, default PDP rates that include TOU rates during non-peak periods;

· For small and medium C&I customers that have had an advanced meter for at least 12 months, default PDP rates that include TOU rates during non-peak periods. Flat rates will no longer be available to these customers; and

· For small and medium agricultural customers that have had an advanced meter for at least 12 months, default TOU rates. Flat rates will no longer be available to these customers.

The specifics of PG&E's PDP rate proposal and cost recovery request are identified and discussed throughout this decision. With respect to implementation dates, DRA opposes the February 1, 2011 date for small and medium C&I customers, as discussed in Section 7.1.

3.1. Applicability Guidelines

PG&E proposes that PDP should only be available to bundled-service customers, since the proposal relates to the generation component of the unbundled rate. Thus, Direct Access, Community Choice Aggregation, and Transitional Bundled Commodity Cost customers are excluded from PG&E's PDP proposal. PG&E also indicates that (1) customers on street light and traffic control rate schedules should be excluded because such customers are typically not able to control or reduce their load in response to a PDP event, and many are unmetered; (2) Net-Energy Metering (NEM) system and standby customers (Schedule S) should be excluded, consistent with existing CPP program eligibility requirements; (3) standby customers should be excluded because they use energy from the grid infrequently and inconsistently and not necessarily during a PDP event; and (4) partial standby customers should be eligible for the PDP rate for the load PG&E serves on a regular basis.

In addition, PG&E states that master-metered customers and those on special tariffs should be treated as follows for purposes of PDP eligibility:

· Residential master-metered customers without tenant sub-meters should not be eligible for the PDP rate since the sole financial responsibility for PDP charges or credits would fall on the master-meter owner, who has little control of tenant usage;

· Residential master-metered customers with tenant sub-meters, e.g., mobile home parks, RV parks, marinas, should not be eligible because, among other things, their sub-meters generally do not measure interval usage;

· Non-residential master-metered customers that qualify and elect to install sub-metering under Rule 18.C.2 should be required to default to a PDP rate;

· Non-residential customers on a discounted tariff rider option or a stand-alone special tariff associated with an otherwise applicable rate schedule, e.g., Schedules ED, E-31, will be eligible to default or elect PDP based on their underlying rate;

· Non-residential customers on stand-alone special tariffs, e.g., Schedules AG-ICE, E-37, will be eligible to default or elect PDP, based on an applicable rate schedule; and

· Customers on Schedule E-CPP and Commercial SmartRate should be defaulted to PDP starting on May 1, 2010.

No party opposed any of these eligibility standards. They are reasonable and will be adopted.