SCE's Response

SCE responds that it does not dispute the need for a refund of a portion of Cerritos' payments of the CRS during 2005 and 2006. SCE, however, does not agree that Cerritos' total obligation for 2005 and 2006 is zero. SCE states Cerritos relies on D.06-07-030 to calculate its liabilities for 2005 and 2006. However, that decision established the CRS for municipal departing load for the years 2003 and 2004, which SCE states may not include the costs of procurement contracts entered into by SCE which would be recoverable from Cerritos' CA customers based on their CRS vintage. SCE observes that Cerritos' liabilities can only be established after the calculation of CRS obligations for 2005. SCE also objects to the use of an expected "negative indifference rate" for 2006 to offset expected 2005 positive CRS liabilities for Cerritos' customers. SCE observes that
D.06-07-030 only adopted a negative indifference rate for undercollections. Cerritos, according to SCE, has accrued overcollections.