8. Procedural Matters

The utilities requested that their respective ROE application be categorized as a ratesetting proceeding within the meaning of Rule 1.3(e). By Resolution ALJ 176-3192, dated May 24, 2007, the Commission preliminarily determined that the applications of SCE, SDG&E and PG&E were ratesetting proceedings and that hearings were expected. This ratesetting classification was subsequently affirmed in the Assigned Commissioner's June 21, 2007 Scoping Memo and Ruling.

That Scoping Memo and Ruling, among other matters, designated Administrative Law Judge (ALJ) Galvin as the principal hearing officer, established a bifurcated evidentiary hearing schedule and determined the issues of this proceeding. The issues to be addressed in the first series of evidentiary hearings encompassed all matters impacting the utilities' test year 2008 cost of capital including capital structure, costs of long-term debt and preferred stock, return on common equity, debt equivalency, and related revenue requirement recovery. The second set of evidentiary hearings will address cost of capital mechanisms that may replace the utilities' annual cost of capital applications.

The first series of evidentiary hearings were held on August 28, 2007, and continued on September 10, 2007 through September 13, 2007. Each of the utilities, FEA, DRA and ATU, submitted testimony and evidence. The utilities' test year 2008 cost of capital issues were submitted upon the receipt of October 5, 2007 reply briefs.