2. Background
2.1. Application and Proposed Testimony
On November 8, 2002, PG&E filed its formal application for a test year 2003 GRC. The GRC encompassed Phase 1 to address revenue requirement issues, and Phase 2 to address rate design issues. On May 27, 2004, the Commission issued its decision on Phase 1 issues, and directed applicant to file a separate rate design application. (Decision (D.) 04-05-055.)
On June 17, 2004, applicant filed this application and supporting proposed testimony. On August 20, 2004, the first prehearing conference (PHC) was held. On August 27, 2004, the Scoping Memo and Ruling of the Assigned Commissioner was issued. The Scoping Memo, among other things, determined that the category for this proceeding is ratesetting, stated the issues, and set the schedule.
Consistent with the schedule (as amended by subsequent rulings), applicant served supplemental and updates of proposed testimony, proposed rebuttal testimony, plus errata and corrections during the period from December 2004 through May 2005. Five Public Participation Hearings were held in January and February 2005. The Office of Ratepayer Advocates (ORA) and other parties served proposed testimony and rebuttal testimony during the period from January through April 2005.
2.2. BART and SierraPine Issues
In May 2005, the San Francisco Bay Area Rapid Transit District (BART) and SierraPine Ltd. (SierraPine) asked that a limited issue specific to each be decided on an expedited schedule. Their request was granted. On July 21, 2005, we found that neither BART nor SierraPine are subject to certain charges associated with applicant's energy recovery bonds (ERBs).1 (D.05-07-041.)
On February 17, 2005, applicant served notice on all parties of a settlement conference. (Rule 51.1(b) of the Commission's Rules of Practice and Procedure (Rules).) On March 9, 2005, PG&E hosted the initial settlement conference. Additional settlement discussions were held in subsequent weeks by conference call.
On May 13, 2005, applicant and settling parties filed a motion asking the Commission to adopt a settlement (May 13, 2005 Settlement) resolving issues on marginal cost, revenue allocation, and limited rate design matters. The May 13, 2005 Settlement is in Attachment B.
On June 3, 2005, applicant and settling parties filed a motion for Commission adoption of two supplemental settlements: Supplemental Residential Settlement and Supplemental Small Light and Power Settlement. These two Settlements are in Attachments C and D, respectively.
On July 8, 2005, applicant and settling parties filed a motion for Commission adoption of three supplemental settlements: Supplemental Light and Power Settlement, Supplemental Agricultural Settlement, and Supplemental Energy Recovery Bond Settlement. These three Settlements are in Attachments E, F and G, respectively.
Hearings were held on May 23, June 3, June 9 and July 12, 2005, to receive evidence and hear testimony from panels on various Settlements. The Settlements resolve all outstanding issues regarding marginal costs, revenue allocation and rate design, except one. Settling Parties assert that each settlement is reasonable in light of the whole record, consistent with law and in the public interest, and should be adopted. We address the Settlements in this decision. The one remaining issue involves the definition of the agricultural class. We will address that issue in a subsequent decision.
1 The ERBs are authorized and used to reduce ratepayer costs related to applicant's bankruptcy reorganization. (See D.04-11-015.)
