IV. Discussion

A. AB1X-6

Under the recently enacted AB1X-6, the Commission is required to ensure that Edison's generating assets, including SONGS 2&3, "remain dedicated to service for the benefit of California ratepayers." The modifications Edison proposes in its petition, as modified by this decision, comply with AB1X-6, and we adopt them on that basis.

Edison concedes that the relief it requests is appropriate, if not required, under ABX1-6:

"AB1X-6, enacted January 18, 2001 requires the Commission to ensure public utility generation assets remain dedicated to service for the benefit of California ratepayers. Returning SONGS 2&3 to traditional cost-of-service ratemaking is one way to assure dedication of SONGS 2&3 to service of California ratepayers." (Edison Petition at p. 3.)

We do not base our decision on Edison's MOU with CDWR, nor do we take any position on the MOU in this decision.

B. The Modifications

D.96-04-059 adopted, with modifications, a February 5, 1996 joint proposal of Edison and SDG&E with respect to SONGS 2&3.³ Many of the modifications proposed by Edison are to the joint proposal. Edison proposes the following modifications to the joint proposal:

· Elimination of the 50/50 sharing mechanism for SONGS 2&3 post-2003 net benefits (Joint Proposal (JP), Section 4.4.3);

· Shift the cost responsibility for shutdown Operation and Maintenance (O&M) costs from shareholders to ratepayers (JP Section 4.4.6);

· Shift the cost responsibility of decommissioning costs from shareholders to ratepayers (JP Section 4.8.1 (a));

· Shift the cost responsibility for certain liabilities associated with nuclear or electric magnetic fields (EMF) or other incidents and exposures at SONGS 2&3 post-2003 (JP Section 4.8.5).

These modifications are reasonable and we adopt them as set forth in the Ordering Paragraphs of this decision.

However, overlooked in Edison's filing is the obligation that Edison serve ratepayers with SONGS 2&3 generation after 2003. We therefore add a conclusion of law to D.96-04-059 to ensure Edison has the obligation to serve ratepayers with SONGS 2&3 generation after 2003. The Commission retains the discretion to further define the appropriate cost-of-service ratemaking for SONGS 2&3 in future decisions.

Edison suggests adding a conclusion of law making its recommended modifications effective through December 31, 2010 in conformance with the language of the MOU. AB1X-6 provides that no facility for the generation of electricity owned by a public utility may be disposed of prior to January 1, 2006. We adopt the modifications discussed above because they are consistent with AB1X-6, but do not impose a cut-off date for these modifications because AB1X-6 does not require a utility to dispose of any of its assets after January 1, 2006. If appropriate at a later time, we have the discretion to determine whether to modify further the ratemaking treatment for SONGS 2&3.

Finally, Edison suggests the Commission add a conclusion of law to clarify that the modifications will not change the SONGS 2&3 ratemaking plan, the ICIP plan, approved by the Legislature for continuation through December 31, 2003 in Pub. Util. Code § 367(a) (4). It is unnecessary for us to adopt this clarifying language at this time. We also note that although ORA and TURN's request to broadly look at plants returning to cost-of-service regulation is not addressed in this decision, they can pursue this issue in other appropriate proceedings.

C. Compliance With Rule 47(d)

Rule 47(d) of the Commission's Rules of Practice and Procedure (Rules) requires an explanation of why the petition for modification could not be filed within one year of the issuance of the decision that is requested to be modified. AB1X-6 was enacted in January 2001, and the Commission adopted the decision Edison requests be modified in April 1996. Thus, it would have been impossible for Edison to have filed this petition within one year of the issuance of D.96-04-059.