4. CalWater Conservation Memorandum Account
CalWater and DRA agree that CalWater should have the flexibility to expand conservation programs for the for the Antelope Valley, Bear Gulch, Dominguez-South Bay, Hermosa-Redondo, Kern River Valley, Marysville, Palos Verdes, and Redwood districts. CalWater should be authorized to set up a conservation memorandum account in each of these districts, because the revised rate case plan delays the GRC for the Antelope Valley, Bear Gulch, Dominguez-South Bay, Hermosa-Redondo, Kern River Valley, Marysville, Palos Verdes, and Redwood districts by a year and a half.37 The latest GRC decision for these districts, D.06-08-011, authorized a total conservation budget of $538,933 a year, to be booked into a one-way balancing account by district. As of July 1, 2007, CalWater had spent $182,340 of its authorized annual conservation budget. CalWater and DRA agree that the additional conservation funding from July 1, 2009 through December 31, 2010 should be $766,600 for all ten districts and sub-districts.38 The settling parties propose that CalWater provide DRA a report of its planned conservation programs, program design and program evaluation for the 18-month period. CalWater agrees to focus on water conservation programs for low income customers in addition to other cost-effective programs. CalWater and DRA agree that the conservation memorandum account will be reviewed in 2011 through a Tier III advice letter filing. If there is a zero balance in the memorandum account and a balance in the one-way balancing account, the amount in the one-way balancing account will be returned to ratepayers as required by D.06-08-011.
No party opposed the settlement agreement. The settlement provides additional conservation funding to be booked into a memorandum account as a result of the delay in the GRC for these ten districts and sub-districts. Since we are encouraging Class A water utilities to increase their conservation efforts, it is reasonable to permit CalWater to book additional conservation expenses in the one-way balancing account for these districts for the 18-month period. Since the expenses booked to the account cannot be reviewed in these districts' GRC, review through the Tier III advice letter process is reasonable.
37 The conservation memorandum account for each district will be in effect from July 1, 2009 until December 31, 2010.
38 The proposed conservation budget limits for the 18-month period by district are attached as Attachment 1.
