2. Background
On May 6, 2010, the Commission issued Order Instituting Rulemaking 10-05-005 (OIR) to determine whether revisions or updates are necessary to utility tariff rules governing adjustments of customer bills due to meter and/or billing errors and whether utility deposit rules need to be revised. The OIR strictly limited any tariff revisions to treating small business customers the same as residential customers for specific billing and deposit purposes. The OIR also established a preliminary scoping memo identifying the issues and a schedule.
The OIR was initiated as a result of numerous business customer complaints to the Commission's Business and Community Outreach (BCO) staff. These complaints were from business customers that were unexpectedly faced with large utility back-bills for service dating back several years. The back-bills resulted from utility errors and were not discovered for at least three years. Because these customers operated small businesses, they could not pay such large bills in the short timeframes that the utilities demanded, nor could they recover these funds from their customers. The Commission concluded that small business customers suffer the same problems as residential customers and thus should be treated the same for billing and metering errors and back-billing purposes.
On June 14, 2010, Opening Comments were filed by Pacific Gas and Electric Company (PG&E), Southern California Edison Company (SCE), Southern California Gas Company and San Diego Gas and Electric Company (collectively, Joint Utilities), PacificCorp, Mountain Utilities, Southwest Gas Company (Southwest Gas), Golden State Water Company,3 the Division of Ratepayer Advocates (DRA), the Greenlining Institute (Greenlining), and The Utility Reform Network (TURN).
On June 28, 2010, Reply Comments were filed by the Joint Utilities, PG&E, Southwest Gas, SCE, Greenlining, TURN, and DRA.
On July 6, 2010, pursuant to the OIR, a workshop was held at the Commission's offices in San Francisco. Parties attending the workshop focused on three main issues:
1. A definition of "small business."
2. Tariff policies addressing back-billing for small business customers.
3. Tariff policies addressing deposits for small business customers.
On July 28, 2010, an Assigned Administrative Law Judge's (ALJ) Ruling provided an opportunity for comments on a Business and Community Outreach Staff Report (Report). The Report, summarizing the comments of parties who attended the Workshop, states that parties generally were in agreement that a small business should be defined as one of the following:
1. A non-residential electric customer with annual consumption of 40,000 kWh or less or an energy demand of 20 kW or less.
2. A non-residential gas customer with an annual consumption of 10,000 therms or less.
3. A non-residential customer meeting Section 14837 of Government Code's definition of "micro-business."
The Report concludes that parties agreed to revise the back-billing tariff rule for small businesses such that the maximum back-billing period would be three months, rather than the current rule of three years. In addition, the Report recommends that the overcharge refund period for billing errors, currently six months, be revised to three years so it is the same as the overcharge refund period for metering errors.4 Although the Report notes that parties were unable to agree on changes in deposit rules, BCO staff recommends changes in deposit rules that would effectively limit deposits to twice the average monthly bill rather than twice the maximum monthly bill. BCO staff also recommends small business disconnection notice practices and pursuit of alternative credit and payment policies.
3 Golden State Water Company owns and operates its Bear Valley Electric Service.
4 Current tariffs generally provide that overcharges for billing errors may be refunded for up to three years, while overcharges for metering errors may be refunded for up to six months. PacifiCorp's tariff Rule 9 is an exception as it provides that overcharges for both billing and metering errors be refunded for up to six months.
