V. Standard of Review

The applicants alone bear the burden of proof to show that the rates they request are just and reasonable and the related ratemaking mechanisms are fair.

For the purposes of these proceedings and as used in the scope above, we define reasonableness for decommissioning expenditures consistent with prior Commission findings, i.e., that the reasonableness of a particular management action depends on what the utility knew or should have known at the time that the managerial decision was made.³ However, with respect to Phase 1 SONGS 1 decommissioning work, the Commission in D.99-06-007 adopted a ratemaking settlement that included a presumption that the utilities' conduct is reasonable in performing Phase 1 SONGS 1 decommissioning work if the scope of the work completed and the most recently approved SONGS 1 decommissioning cost estimate bound the costs incurred. (Settlement § 4.2.2.2.c., at 86 CPUC2d 604, 620.)

In order for the Commission to consider the proposed settlements in these proceedings as being in the public interest, the Commission must be convinced that the parties had a sound and thorough understanding of the applications and all of the underlying assumptions and data included in the record. This level of understanding of the applications and development of an adequate record is necessary to meet our requirements for considering any settlement, as discussed below. The disputed issues for PG&E are resolved in this decision based on the evidence in the record.

³ See for example, D.02-08-064, dated August 22, 2002, mimeo., pp. 5-8.