Settlement Agreement Provisions

The Settlement Agreement between CPSD and SDG&E, included as Attachment 1 to today's decision, begins with a number of recitals. These recitals acknowledge the events that led to issuance of the OSC, restate the separate contentions of CPSD and SDG&E that each has offered sufficient documentation to support its position and prevail on the alleged Rule 1.1 and Rule 8.3 violations, and conclude with SDG&E's reassertions that it (1) admits an inadvertent violation of Rule 8.3, which violation was cured promptly after discovery and caused no prejudice to any other party but (2) does not admit any violation of Rule 1.1.⁸

The main provisions of the parties' settlement include these terms:

· Paragraph 1 -- Apology: SDG&E tenders an apology for imprecision in its communications with decision-makers and states:

SDG&E understands the importance of clear and accurate communications with the Commission. Such communications are critical to the integrity of the regulatory process ... SDG&E sincerely regrets that it fell short of its own high standards here ....⁹

· Paragraph 2 -- Payments of $920,000 in shareholder funds, as follows:

o $200,000. SDG&E commits to contribute $50,000 to 2-1-1 San Diego, a local non-profit that provides multi-lingual information about disaster relief and other services by telephone on a 24-hour basis, and $150,000 to SDG&E's Neighbor-to-Neighbor Program, which provides assistance of up to $200 on a customer's bill.

o $220,000. SDG&E commits to reimburse the Commission's Energy Division for expenditures related to the allegations in the OSC and Sunrise Powerlink Transmission Project-related expenditures.

o $500,000. SDG&E commits to pay this amount to the State's General Fund.

· Paragraph 3 - Professional Responsibility Class. SDG&E will develop and sponsor a professional responsibility course, in consultation with CPSD and the Commission's Public Advisor's Office, that focuses on the Commission's Rules, emphasizing Rule 1.1 duties and ex parte rules best practices. The course would be facilitated by a third party.

· Paragraph 4 -- Ex Parte Best Practices Manual. SDG&E will create an ex parte best practices manual in consultation with the Commission's General Counsel's office.

· Paragraph 5 - Compromise. The parties specify that their settlement is not an agreement on disputed facts and law.

· Paragraph 8 - Evidentiary record. The parties specify which documents they seek to have identified and received in evidence.

⁸ Recital E of the Settlement Agreement actually references Rule 1, which is how the ethics rule was known prior to issuance of the Commission's September 2006 revision of its Rules of Practice and Procedure, which renumbered the Rule as Rule 1.1.

⁹ Settlement Agreement at 4.