PROTESTS

No party protested AL 1249-E or AL 1260-E/-E-A. Enron had protested AL 1260-E-A, but later withdrew its protest.

AL 1254-E was protested by Tenderland Power Company (TPC), an ESP, on September 26, 2000. Scripps Institute (Scripps) filed a late-filed protest to AL 1254-E on November 9, 2000. Both TPC and Scripps protest SDG&E's stated intent in AL 1254-E to apply the 6.5 cent/kWh ceiling to DA customers . TPC states that AB 265 and D.00-09-040 should not be interpreted such that the rate stabilization plan applies to DA customers. On October 2, 2000, Utility.Com (an ESP) and the Alliance for Retail Markets (ARM)³ filed letters in support of SDG&E's statement in AL 1254-E that it intends to apply the energy rate ceiling to direct access customers.

TPC protested AL 1264-E on November 3 and 1264-E-A on December 21 along the lines of its protest to AL 1254-E.⁴ Scripps protest to AL 1254-E was probably intended for this AL. SDG&E filed its response to Scripps' protest in the context of AL 1264-E. We will accept Scripps' late-filed protest to AL 1254-E as a protest to AL 1264-E. It addresses issues raised by AL 1264-E/E-A. The protest period for AL 1264-E-A did not end until December 26, 2000. By letter dated December 14, 2000, Mr. Larry Cornett, a DA customer in SDG&E's service territory, protested AL 1264-E-A (the protest was received by the Commission and filed on December 18). Mr. Cornett, a customer of TPC, requests that the Commission deny SDG&E's request to apply the rate stabilization plan to all DA customers. Instead, Mr. Cornett states that the Commission should allow "customers of SDG&E and all DA customers the right to opt-out of AB 265."

ARM filed a letter on November 8, 2000 in support of AL 1264-E. Competitive Retail Energy for Consumers (CREC)⁵ filed letters on December 7 and 14, 2000 in support of AL 1264-E/E-A urging speedy resolution on the Commission's December 21^st meeting or by shortening or eliminating comment periods. CREC states that its members are being deluged with calls from customers in the San Diego area that want to know their status in order to make reasonable energy choices.

Utility.Com filed comments on November 3, 2000 in support of AL 1264-E but requests that SDG&E amend its proposed language to describe that the electric energy charge (EE) adjustment is a Utility Distribution Company administered line item on the bill. Utility.Com also proposes that the language reflect that DA customers may calculate their effective price for electricity by adding the monthly EE charge adjustment to its ESP electric commodity charge.

The Commission's Office of Ratepayer Advocates (ORA) submitted a late-filed protest to AL 1264-E, on November 29, 2000, which reflected informal cooperative efforts between ORA and another party. ORA's protest expressed general support for SDG&E's DA Plan but suggested content and process improvements to SDG&E's plan for customer notification. We will accept ORA's protest since it prompted SDG&E to supplement AL 1264-E as discussed below.

Energy Division (ED) is aware that one ESP mailed a post card to its customers, urging them to ask the Commission to approve AL 1264-E. The Commission's Public Advisor's Office informed ED that as of noon on December 14, 2000, it had received 144 contacts supporting SDG&E's AL 1264-E ( 118 emails, 25 calls, 1 letter). ED and other Commission staff also received calls from several DA customers, some who support and others who oppose including DA customers in the rate stabilization plan.

SDG&E responded to TPC's protest of AL 1254-E on October 3 and to TPC's protest of AL 1264-E on November 9, 2000. SDG&E also filed a letter on October 25 objecting to TPC's October 10 rebuttal to SDG&E's response to TPC's protest of 1254-E. In its October 3 response, SDG&E states that the Commission's intent was to have SDG&E offer comparable rate ceiling benefits to DA customers. SDG&E states in its November 9 response that TPC's arguments are specious and its interpretation of AB 265 is wrong. SDG&E also points out that except for TPC, all ESPs that have either reviewed or helped develop AL 1264-E agree that DA customers should receive the benefits of the rate stabilization plan. SDG&E responded to TPC's protest of AL 1264-E-A on January 2, 2001. Noting that TPC's protest reaffirmed objections stated in its protests of ALs 1254-E and 1264-E, SDG&E referred to its responses to those protests and included them by reference.

SDG&E responded to the protest of Scripps, on November 16, 2000, acknowledging that Scripps, as a large customer, could have been able to bargain for and receive an advantageous rate. But SDG&E points out that 95% of SDG&E's DA customers are residential and small commercial and therefore do not have comparable bargaining power.

SDG&E filed AL 1264-E-A to address the concerns raised in ORA's November 29 late-filed protest to AL 1264, and Utility.com's November 3 letter of support. SDG&E also responded in support of CREC's letter on December 14.

SDG&E responded to Mr. Larry Cornett's Protest of AL 1264-E-A on December 21, pointing out that the Commission has yet to adopt a cost recovery mechanism. SDG&E moreover states that San Diego Union Tribune reported on December 19th that TPC told its 1500 customers it could no longer provide the cheap electricity it had previously promised and that it was therefore returning its customers to SDG&E, raising concern about the protection afforded by DA. Mr. Cornett informed ED that this situation did not cause him to withdraw his protest.

The following section includes a more detailed summary of the major issues raised in the protests and other contacts.

3 3. ARM states that it is "a coalition of firms that are committed to the creation of a robust retail market", and that its members "serve the bulk of direct access customers" in California.

4 4. Although SDG&E replaced AL 1264-E with AL 1264-E-A, the substance of AL 1264-E which TPC protested was not modified by AL 1264-E-A.

5 5. CREC was formerly ARM. Its members include AES NewEnergy, Inc.; AXON Field Solutions; Chevron Energy Solutions; Commonwealth Energy Corp.; Enron Energy Services, Inc.; Green Mountain Energy Company; The New Power Company; Shell Energy Services; and Strategic Energy, L.L.C.