2. Procedural Background
On September 22, 2010, California-American Water Company (Cal-Am) filed this application for authorization to implement the Carmel River Reroute and San Clemente Dam Removal Project (Project) and to recover from its customers the costs associated with the Project over a 20-year period. Cal-Am's application asserts that the Project addresses longstanding seismic issues associated with the San Clemente Dam (Dam), provides significant environmental benefits, and due to an innovative public/private partnership, will not cost Cal-Am's customers any more than the least-cost option of dam buttressing that Cal-Am analyzed for addressing seismic safety concerns.6
Cal-Am partnered on the Project with the California State Coastal Conservancy (Conservancy), and the National Marine Fisheries Service (NMFS). The Conservancy, established in 1976, is a State agency that protects, restores and enhances coastal natural resources and the public's access and enjoyment of the coast. It does its work largely by providing funding and technical assistance for projects carried out by local governments, other public agencies, and nonprofit organizations. The Conservancy is providing funding for this Project in order to have the environmentally superior option of San Clemente Dam (Dam) removal pursued by Cal-Am. To avoid gifting public funds to a corporation, the Conservancy has limited its funding to costs that exceed Cal-Am's alternative proposal to strengthen the Dam by adding steel-reinforced concrete to the existing structure (Dam buttressing). The NMFS is a federal agency and is participating in the Project due to its concerns that the Dam buttressing alternative's use of sluice gates with a new fish ladder could harm the steelhead fish in the Carmel River listed as a threatened species under the federal Endangered Species Act.7
Cal-Am requests rate recovery for $49 million in estimated Project construction costs. Cal-Am also seeks review and rate recovery of all costs recorded in the San Clemente Dam Memorandum Account through October 31, 2010, and the estimated costs from November 1, 2010 through December 31, 2011. Cal-Am proposes to fund this recovery through a Regulatory Asset and San Clemente Dam Balancing Account, with surcharges to begin on January 1, 2012, and continue over a 20-year period. Cal-Am requests to book all costs it incurs into the Balancing Account and to have the difference between estimated and final costs reviewed and trued-up when the Project is complete.
On October 29, 2010, the Division of Ratepayer Advocates (DRA) and the Monterey Peninsula Water Management District (MPWMD) separately protested Cal-Am's application.
On November 8, 2010, Cal-Am replied to the protests. On November 19, 2010, Cal-Am submitted a supplemental filing on costs tracked in the memorandum account and included a revised proposed procedural schedule to address DRA's staffing concerns. A prehearing conference (PHC) was held on November 22, 2010 to discuss the proposed scope and schedule for the proceeding. An Assigned Commissioner and Administrative Law Judge's Ruling and Scoping Memo followed on December 23, 2010.
Public Participation Hearings were held in Monterey and Seaside California on February 7 and 8, 2011, and evidentiary hearings were held in San Francisco on June 8-13, 2011.8 The record was submitted on July 20, 2011, with the filing of reply briefs.
6 Application at 1.
7 Exhibit 3, Rebuttal Testimony of Ambrosius at 3.
8 A late-filed motion to intervene was filed by the Planning and Conservation League Foundation (PCLF) on May 25, 2011, and granted the same day. PCLF served rebuttal testimony on May 25th and participated in evidentiary hearings and briefing. On June 6, 2011, PCLF filed a Notice of Intent (NOI) to seek intervenor compensation. By Administrative Law Judge (ALJ) ruling dated August 4, 2011, PCLF was found ineligible to seek intervenor compensation in this proceeding due to the untimeliness of its NOI filing.
