Findings of Fact
1. The Commission adopted ATRs, the latest version of which are set forth in D.06-12-029.
2. The Joint Applicants, together with five other nuclear power plant operators, plan to establish an LLC entity named the STARS Alliance, constituting a new affiliate for PG&E and SCE.
3. The Joint Utilities are currently members of the USA, an electric operative engaged in many of the same activities contemplated by the STARS Alliance, including the sharing of resources, the joint procuring of goods and services, and the consolidating of internal functions.
4. The current USA does not allow the STARS Alliance leadership to drive STARS Alliance-specific performance improvements, or to optimize coordination efforts among the seven STARS Alliance members.
5. The stated functions for the STARS Alliance include sharing existing resources, jointly procuring selected goods and services to achieve economies of scales, and coordinating joint planning and operational activities.
6. The STARS Alliance stated objective is to increase efficiency and reduce costs in a manner that improves the operational and organizational effectiveness of its members' nuclear units.
7. Equity members are needed for the LLC to secure clearance from the Antitrust Division of the DOJ that the activities of the STARS Alliance are not anti-competitive.
8. The STARS Alliance would be an affiliate subject to the ATRs under D.06-12-029 since each of the Joint Utilities' ownership interest in the STARS Alliance is expected to exceed 5%.
9. Without an exemption from the ATRs, the Joint Utilities will not be able to engage in many of the transactions contemplated under the STARS Alliance including the sharing of employees, best practices and other information and equipment under mutually beneficial terms for the STARS Alliance members.
10. Under Rules III.A.1. and 2., a utility must not represent, as a result of an affiliation, that its affiliates or customers of affiliates will receive different treatment by the utility than that provided to other, unaffiliated companies. Likewise, the utility must not provide its affiliates any preference over non-affiliated suppliers or their customers in the provision of utility-provided services.
11. Without an exemption from Rules III.A.1. and 2., the Joint Utilities will not be able to engage in many of the transactions contemplated under the STARS Alliance including the sharing of employees, best practices and other information and equipment under mutually beneficial terms for the STARS Alliance members.
12. Given the unique composition of the STARS Alliance's members and because the STARS Alliance does not intend to be a for-profit enterprise, the reciprocal sharing of supply, capacity, services, or information would be unlikely to be beneficial if undertaken with entities outside of the Alliance.
13. The restrictions imposed by Rules III.E., IV.B., and IV.D. would significantly reduce, if not eliminate, the benefits Joint Utilities' customers may receive from the STARS Alliance.
14. To the extent that Rule IV.B. would require the Joint utilities to keep non-public information provided to the STARS Alliance open to public inspection, the result would be problematic and contrary to idea that non-public information should be protected and that customers may be harmed by the release of such information.
15. With respect to Rule IV.D., the terms and conditions of the Joint Utilities' release of suppliers' non-public information to the STARS Alliance will vary and may or may not require an exemption.
16. Rule V.C. precludes a utility from sharing office space and equipment, and information systems with an affiliate. Rule V.D. prohibits the joint purchase of goods and services associated with the traditional utility merchant function. Rule V.E. permits a utility to share personnel with its affiliates as long as the "shared support [is] priced, reported and conducted in accordance with the Separation and Information standards . . . as well as other applicable Commission pricing and reporting requirements."
17. Without exemption from Rules V.C. and V.E., the STARS Alliance could not function as envisioned or achieve its objectives regarding the sharing of personnel, parts, equipment, tools, and expertise among its members.
18. The STARS Alliance envisions the joint procurement of goods and services to replicate the same economies of scale enjoyed by large fleet nuclear utilities with operating reactors at multiple sites. Unless exempted from Rule V.D., such joint procurement would not be permitted
19. While the STARS Alliance will not be marketing its services to retail customers or companies beyond its members, exemption from Rule V.F. will help minimize STARS Alliance compliance costs. Rule V.F. prescribes requirements to eliminate customer confusion regarding the corporate identification and advertising.
20. Without an exemption from Rule V.G., officers of the Joint Utilities would be prohibited from being officers of STARS Alliance.
21. Limiting employees' time working for STARS Alliance to no more than 30% of their chargeable time in a calendar year as set forth in Rule V.G.2.e, could diminish the benefits of the STARS Alliance.
22. The Joint Applicants have agreed, upon approval of their application, to comply with the conditions set forth in their application and set forth in Ordering Paragraph 2 of this decision.
23. The ERRA proceeding is the appropriate forum to submit the report on STARS Alliance activities for Commission review.
24. The reporting template set forth in Appendix A of this decision, reflecting the amended proposed template proposed in the application, provides a reasonable format for reporting and tracking savings relating to the STARS Alliance activities.
