CONTACT:	Armando Rendón		May 24, 2001	CPUC: 055
	415-703-1366	abr@cpuc.ca.gov		R.___________

CPUC WILL REVIEW BASELINE ALLOWANCES FOR ENERGY USERS

The California Public Utilities Commission (CPUC) today opened a review as to whether current baseline allowances for residential gas and electricity users should be revised and to what new levels. The recent crisis in the reliability of electricity and unprecedented increases in the price of electric and gas service have prompted the Commission to undertake its review at this time.

State law exempts customers who stay below 130 percent of baseline use from rate increases. The lowest priced tier in the new PG&E and Southern California Edison rate structure approved by the CPUC on May 14th is from 0-100 percent of baseline, the next tier is from 100 to 130 percent. The rationale behind these tiers is to soften the effect on residential customers of today's runaway energy prices, and at the same time encourage conservation

By state law, the Commission must set baseline quantities for gas and electricity at a "significant portion of the reasonable energy needs of the average residential customer." That level is defined as 50 to 60 percent of average residential usage, and 60 to 70 percent for all-electric customers and for gas customers during winter heating season. The law also requires the Commission to allow for seasonal and climatic changes in setting baseline quantities

The Commission may look at a number of aspects governing the baseline quantity, such as:

· Whether geographic boundaries of each utility's baseline zones should be re-designed to take best advantage of climate differences

· How should changing household characteristics over the past 25 years be taken into consideration?

· Have the seasons for each utility's baseline program been correctly defined?

· Are today's baseline criteria consistent across the utilities, or should they be?

· Are the standard limited allowances for medical care customers sufficient?

The Commission will shortly issue a proceeding schedule, beginning with a pre-hearing conference in June to set forth the scope and specific hearing dates. The goal is to have a proposed decision on the Commission agenda by September.