VII. Comments on the Draft Decision
Pursuant to Rule 77.7(f)(9) of the Commission's Rules of Practice and Procedure, in order to implement this rate reduction expeditiously, we have determined that the public necessity requires a reduction of the 30-day period for public review and comment. Accordingly, comments on the draft decision were due no later than February 19, 2004. No replies were permitted.
The following parties filed comments: AReM, the California Municipal Utilities Association (CMUA), DWR, Merced Irrigation District (Merced), Modesto, and PG&E. CMUA also moves to intervene in this proceeding to file its comments on the draft decision and we grant CMUA's motion to intervene for this purpose. We address the parties' suggested changes to the draft decision below. Additionally, we make other nonsubstantive changes to improve the discussion and to correct typographical errors.
The CMUA, Merced, and Modesto state that municipal utilities were not involved in the negotiations leading up to the settlement. They therefore object to the settlement's provision that defines the revenue requirement associated with the Regulatory Asset as nonbypassable, with one noted exception for certain Customer Generation Departing Load "that is not required by
D.03-04-030 as modified by D.03-04-041 to pay the DWR Power Charge" as well as load excluded from the definition of Customer Generation Departing Load by footnote 1 and pages 2-3 of D.03-04-030.
The various municipal utilities advocate different changes to the draft decision. Modesto requests that the Commission should revise the draft decision to exclude municipal departing load from the cost responsibility associated with the Regulatory Asset. Merced requests that the Commission revise the draft decision to exclude municipal utilities from the settlement's purview, and permit them to negotiate with PG&E concerning their responsibility, if any, to pay for the Regulatory Asset. CMUA proposes that the draft decision be modified to state that municipal departing load should not have any cost responsibility for the Regulatory Asset to the extent that the Commission finds that municipal departing load should not have any cost responsibility for DWR power charges.
We are examining the issue of the allocation of the exception for payment of the CRS for certain new municipal departing load in a limited rehearing ordered by D.03-08-076. This rehearing is limited in nature, only to certain new municipal departing load, and its outcome is pending before the Commission. Therefore, to ensure that the settlement is consistent with Commission decisions, we make changes to the draft decision to state that the tariffs for municipal departing load's cost responsibility for the Regulatory Asset should be set subject to adjustment, and to permit municipal utilities to file a petition for modification of the instant decision once the Commission decides pending issues in the limited rehearing ordered by D.03-08-076 concerning exceptions of certain new municipal load's payment of the CRS. (See Section V.B.)
DWR
DWR requests the draft decision be clarified to more accurately reflect the function of the PCBA, and we make these changes. (See Section VI.B.2.)
PG&E
PG&E requests the draft decision be modified to (1) update PG&E's proposed revenues for 2004 to reflect events that have occurred subsequent to the filing of AL 2465-E; (2) authorize PG&E to implement billing changes proposed in AL 2465-E, including the DA bill increase, as early as possible following the issuance of the Commission's decision in Phase 1 of PG&E's 2003 general rate case (e.g., component rates for distribution, ND, and PPP would be revised); (3) allow PG&E additional time to add the CTC, Regulatory Asset and DWR bond Charge as line items on bundled customers' bills; and (4) acknowledge that PG&E's ALs 2510-G and 2460-E, filed on December 31, 2003, are an essential part of the overall implementation of the resulting rate reductions and allow PG&E to revise them to ensure overcollections and undercollections in PG&E's authorized 2004 revenue requirements are "trued up" in future rates, and to provide clarifying language, consistent with this decision.
With the exception of PG&E's first requested modification, we make these changes. (See Sections IV.B and C, and Section VI, as well as correlative conclusions of law and ordering paragraphs). We decline to modify the decision to update the 2004 electric revenue estimate amount because this amount is also comprised of other estimated revenue requirement components that are subject to pending proceedings. There are balancing accounts or similar mechanisms in place to "true up" the estimates as they become certain, and we see no need to modify the resulting revenue reduction at this time. For example, in a future update to its Regulatory Asset revenue requirement pursuant to D.03-12-035, PG&E can reflect the outcome of the Enron settlement and other actual refunds received to offset the Regulatory Asset.
AReM
In its comments, AReM raises issues similar to those raised in its protest and fully discussed in the draft decision. We therefore make no changes to the draft decision in response to AReM's comments.
