2. Background
In D.04-12-015 the Commission adopted base electric and gas revenue requirements for Southern California Gas Company (SoCalGas) and San Diego Gas & Electric Company (SDG&E) in the consolidated applications for Test Year 2004 Cost of Service. The critical issue in these proceedings was to ensure that the companies receive a reasonable level of revenue for monopoly distribution services. SoCalGas filed Application (A.) 02-12-027 and SDG&E filed A.02-12-028 on December 20, 2002, respectively, for authority to update their gas and electric revenue requirements and base rates. SoCalGas requested an approximate $130 million increase in natural gas distribution revenues for Test Year 2004 and SDG&E requested an approximate $58.9 million increase in electric distribution revenues1 and $21.6 million increase in natural gas distribution revenues for Test Year 2004. In adopting a settlement agreement, with modifications, the Commission authorized $1.457 billion in natural gas distribution revenues for Test Year 2004 for SoCalGas. The Commission authorized SDG&E $754.763 million in electric distribution revenues and $204.721 million in natural gas distribution revenues for Test Year 2004.
These applications were not filed in conformance with the Commission's rate case plan, but instead with specific exemptions from the plans granted as a part of previously adopted incentive ratemaking mechanisms. Prehearing conferences (PHCs) were held on February 19, 2003, March 7, 2003, and September 26, 2003. Public participation hearings were held in August and September 2003, in SoCalGas' service territory in Van Nuys, El Monte, Carson, and San Bernardino, and in SDG&E's service territory in San Diego and San Clemente. Twenty days of evidentiary hearings on Phase One distribution service revenue requirements were held, beginning October 7, 2003. Testimony was received in the evidentiary hearings from numerous witnesses, and over 300 exhibits were received in evidence.2 D.03-12-057 granted interim rate relief to SoCalGas and SDG&E3 by establishing memorandum accounts to track any eventual difference in current rates and any increase or decrease adopted by this decision for Test Year 2004.
Settling parties filed opening briefs on January 20, 2004. On February 4, 2004, non-settling parties filed opening briefs, and all parties filed reply briefs on February 19, 2004. UCAN was an opponent of the SDG&E Settlement and filed its opposition on January 20, 2004.
1 This included the effects of nuclear costs after the termination of the Incremental Cost Incentive Plan (ICIP).
2 Without separately counting errata, SoCalGas and SDG&E sponsored 150 exhibits of direct and rebuttal testimony; Office of Ratepayer Advocates (ORA), 33 direct and cross-examination exhibits; The Utility Reform Network (TURN), 60 direct and cross-examination exhibits; and UCAN, 47 direct and cross-examination exhibits.
3 On April 18, 2003, SoCalGas and SDG&E filed a Motion seeking reconsideration of the April 2, 2003 Scoping Memo. The May 22, 2003 Ruling clarified the Scoping Memo as appropriate, and D.03-12-057 was necessary to grant the interim relief request.
