2001-2002 True Up
In response to recommendations from SDG&E and TURN, and with the agreement of DWR, ALJ Allen ruled that the issues relating to the true-up of DWR's 2001-2002 revenue requirement would be deferred until actual data for 2002 was available. (Transcript v.48, pp.6802-04.) This ruling is appropriate, and is consistent with D.02-02-052, with D.02-02-051, and with the Rate Agreement between the Commission and DWR.
In a separate letter/memorandum dated October 16, 2002, DWR states that actual data for the entire 2001-2002 period will be available in April, 2003. Parties were given the opportunity to recommend a process and schedule for the true-up phase in their briefs, to eliminate the burden of filing a separate pleading.
SDG&E states that it cannot at this time identify what specific issues may be presented, but provides a proposed schedule for the true-up process, with parties filing proposals and procedural recommendations within 21 days after DWR releases its recorded data for the 2001-2002 revenue requirement period, followed by workshops or hearings, as needed. SDG&E expresses hope that the true-up process will be relatively noncontroversial.
SCE argues that the scope of the true-up proceeding should consist of a true-up of DWR's total 2001-2002 forecast expenses to actual expenses, true-up of the allocation of those actual expenses to the utilities' customers, and a true-up of the previous allocation of "net borrowed proceeds" and what the utilities' customers actually pay to DWR. SCE believes its customers have overpaid DWR's prior revenue requirement, and accordingly recommends an extremely expedited schedule for the true-up phase, beginning (and ending) prior to the availability of actual 2002 data.
PG&E, on the other hand, argues that no re-allocation true-up of DWR's 2001-2002 revenue requirement is necessary or appropriate, and requests a Commission determination that no true-up will be made.18 PG&E appears to be most concerned about the possibility of an inter-utility true-up of the sort desired by SCE. In the alternative, PG&E requests that any true-up be completed before the end of 2002.
The schedules proposed by SCE and PG&E are not realistic, would put undue burdens on both parties and the Commission, would require another subsequent true-up, are not an efficient use of resources, and constitute a collateral attack on ALJ Allen's ruling.
We will not determine here the specific details of how any true-up of DWR's 2001-2002 revenue requirement is to be done, other than to note that DWR will not be required to return funds already received from ratepayers.19 All participants will be given an opportunity to express their positions in a separate true-up phase, consistent with ALJ Allen's ruling.20 While SDG&E's proposed schedule is reasonable, we do not adopt it here, but leave to the ALJ and Assigned Commissioner the task of establishing a schedule and process for a true-up phase that incorporates actual data for DWR's 2001-2002 revenue requirement period.
18 However, PG&E's October 8, 2002 filing re surplus sales allocation states: "Differences between the forecast used to set the revenue requirement and the actual surplus sales revenue will be trued up in a future DWR Revenue Requirement Proceeding." (Id., p. 3.) 19 In light of the provisions of the Indenture for DWR's bonds and the provisions of the Water Code under which DWR establishes its own revenue requirement, we do not believe that, as a general matter, we can order DWR to refund monies previously received. This does not prevent us from reducing DWR charges in the future to reflect past over-collections. Nor do we believe that we are barred from adjusting future allocations among service territories to reflect prior results. 20 At that time PG&E may, if it wishes, renew its argument that no true-up should be done.
