ALJ/SMW/lil Date of Issuance 8/1/2011

Decision 11-07-041 July 28, 2011

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Application of San Diego Gas & Electric Company (U902E) for Adoption of its 2011 Energy Resource Recovery Account Revenue Requirement and Competitive Transition Charge Revenue Requirement Forecasts.

Application 10-10-001 (Filed October 1, 2010)

DECISION ADOPTING SAN DIEGO GAS & ELECTRIC COMPANY'S 2011 ELECTRIC PROCUREMENT COST REVENUE REQUIREMENT FORECAST

1. Summary

Today's decision adopts a 2011 Energy Resource Recovery Account revenue requirement forecast of $755.413 million for San Diego Gas & Electric Company, which is approximately $72.543 million lower than the 2010 figure; a 2011 Ongoing Competition Transition Charge revenue requirement forecast of $63.354 million, which is approximately $16.446 million higher than the 2010 figure; and 2011 market benchmark prices of $42.50/Megawatt-hour and $44.33/Megawatt-hour for calculation of the Ongoing Competition Transition Charge and the Power Charge Indifference Adjustment, respectively, which are lower than the 2010 figures by $16.04 and $16.74, respectively. The combined revenue requirement results in a decrease in electric rates of $56.097 million. We also grant San Diego Gas & Electric Company authority to continue to recover equity rebalancing costs associated with its revised Power Purchase Agreement with the Otay Mesa Energy Center, and to modify its current Energy Resource Recovery Account trigger calculation, as discussed herein.