VII. Surplus Sales

All three utilities propose that the sharing of revenue from surplus sales on a pro-rata basis between DWR and the utilities, as established by D.02-09-053, be eliminated. (See, e.g., SDG&E's Opening Brief, pp. 33-37.) DWR does not oppose the elimination of sharing revenues from surplus sales, but notes that as a result of eliminating the sharing of revenues of surplus sales, all DWR sales would be deemed delivered to retail end use customers. DWR states its willingness to work with the utilities and the Commission to amend the Operating and Servicing Agreements to accommodate a Power Charge calculation that reflects that all DWR power is delivered to retail end use customers.

In spite of the agreement between DWR and the utilities on this matter, we cannot change the Operating and Servicing Agreements in this decision, in advance of the necessary filings by DWR and the utilities. The current surplus sales methodology will remain in place for 2004, but we encourage the utilities and DWR to work together to bring the proposed changes before the Commission in the appropriate forum, so that we can implement any agreed-upon changes concurrently with our allocation of DWR's 2005 revenue requirement.