III. Proposed Rules

The first proposed rule under consideration requires California's natural gas utilities, SoCalGas, PG&E, SDG&E, and Southwest Gas, and California's largest electric utilities, Edison, PG&E, and SDG&E, to each sign up for a proportionate amount of the turned back capacity not subscribed to by replacement shippers serving California. Because the May 31 Order does not require the marketers to turn back a specified amount of capacity, the Commission could not, and still cannot, identify a definitive amount of turned back capacity that each California utility should sign up for. In addition, we did not, and still do not, know how much turned back capacity, if any, the California replacement shippers might subscribe to.

The second proposed rule finds just and reasonable and pre-approves the California utilities' subscription to this turned back capacity. The purpose of the second rule is to guarantee that utility compliance with the requirement to sign up for turned back El Paso capacity cannot be the basis for a finding of unreasonableness.