Findings of Fact

1. No protests or responses to the Application were filed.

2. Commission decisions in R.02-01-011, pursuant to Pub. Util. Code
§ 366.2(d), established a CRS to ensure there is no cost shifting among customers.

3. Resolution (Res.) E-4064, approved, with modifications, PG&E's tariff Schedule E-NMDL, implementing prior Commission directives and authorizing procedures for the billing and collection of the CRS and other NBCs from the NMDL Customers located within PG&E's service area.

4. The NBCs currently applicable to NMDL customers served by the Districts within the service territory of PG&E, contained in Schedule E-NMDL, include the DWR Bond Charge, the Tail CTC, the TTA Charge, and the ND Charge.

5. PG&E Schedule E-NMDL permits bilateral agreements between PG&E and POUs or POU customers as an alternative to the billing and collection procedures in PG&E Schedule E-NMDL.

6. The authorization in Res. E-4064 to enter into bilateral agreements was to give IOUs and POUs the flexibility to use other alternative arrangements or protocols to the detailed billing and collection procedures specified in Schedule NMDL.

7. Commission decisions in R.02-01-011 require the IOUs to bill and collect the CRS from MDL to ensure there is no cost shifting among customers.

8. D.09-08-015 approved a bilateral agreement that resolves past, present, and future NBC obligations by payment of amounts that may differ from tariffed charges, that relieves an IOU of its obligations to bill or collect NBCs, and that releases departing load customers of a POU from liability for NBCs.

9. The NBC Agreement allows the Districts to pay PG&E amounts that are less than the amounts that have accrued for past charges and that will accrue for ongoing charges, and relieves PG&E of its obligation to bill and collect the applicable charges.

10. PG&E Schedule E-NMDL provides that NMDL taking service from a POU without the use of transmission and distribution facilities owned by PG&E is exempt from ongoing CTC.

11. Ownership and all costs of the Westley-Tracy transmission line are shared equally between Modesto ID and Turlock ID.

12. Modesto ID presently operates the Westley-Tracy transmission line and Merced ID is solely interconnected with Turlock ID via the Westley-Tracy transmission line.

13. For purposes of the NBC Agreement only, as of November 13, 2007, the NMDL Customers served by either the Merced ID or the Modesto ID qualify for the "stand-alone" exemption set forth in PG&E Schedule E-NMDL, Special Condition 2(e).

14. Without an agreement with the Districts, PG&E will continue to experience a high rate of uncollectibles and incur significant administrative and legal costs to collect unpaid NBCs owed by the NMDL Customers served by the Districts, and these costs will be borne primarily by PG&E ratepayers.

15. PG&E's administrative and legal costs of pursuing collection of the unpaid NBCs owed by currently delinquent NMDL Customers served by the Districts and the customer service and billing costs avoided under the NBC Agreement will be substantially greater than the value of the discounts provided in the NBC Agreement.

16. Pursuant to the Servicing Order, DWR is prohibited from disclosing any information it may receive from PG&E and the Districts in connection with remittances made pursuant to the NBC Agreement.

17. The nondisclosure provisions of the NBC Agreement provide that the parties agree that the information and documents in connection with NBC Agreement are subject to Rule 12.6.

18. With the Applicants' consent, DWR may receive information from settlement negotiations that is sufficient for DWR to determine the remittances related to DWR Bond Charges in connection with the NBC Agreement.

19. D.03-07-028, as modified by D.03-08-076, determined that, for purposes of CTC recovery, "new load" excludes load met through a direct transaction that does not otherwise require the use of transmission and distribution facilities owned by the IOU.

20. The Application is uncontested.