XIX. Future Gas Market Structure and Rate Filings

Since this decision adopts a gas market structure for PG&E's transmission and storage systems for 2004 and 2005, and rates for 2004, we need to provide guidance to PG&E and the parties regarding future filings.

Rates for PG&E's gas transmission and storage systems are being set for 2004 only. Unlike the Gas Accord, no settlement has been proposed to set rates for a multi-year term beyond 2004. Therefore, rates for 2005 will need to be addressed in 2004. PG&E shall file an application proposing its 2005 gas transmission and storage rates on or before March 19, 2004. This date will provide sufficient time for PG&E, interested parties, and the Commission to address the 2005 rate proceeding before the end of 2004.

The gas market structure adopted in today's decision shall continue through 2005. Except as noted in this decision, we will not entertain proposals in the 2005 rate proceeding to change the gas market structure, and we will not entertain the proposals for a Winter Reliability Standard or for a backbone-level rate structure. All of these issues involve significant cost commitments, cost-shifting, and policy considerations, which we are unwilling to consider given present circumstances. These issues, however, may be raised in PG&E's application to determine the gas market structure for 2006 and beyond and rates for 2006.

PG&E's application regarding its proposal for a gas market structure for 2006 and beyond, and gas transmission and storage rates for 2006, shall be filed on or before February 4, 2005. That application should also address whether it is more productive and efficient to conduct a review of PG&E's gas transmission and storage rates every two years, instead of on an annual basis.