3. Background

Public Utilities Code Section 454.9² provides:

"454.9. (a) The commission shall authorize public utilities to establish catastrophic event memorandum accounts and to record in those accounts the costs of the following:

"(1) Restoring utility services to customers.

"(2) Repairing, replacing, or restoring damaged utility facilities.

"(3) Complying with governmental agency orders in connection with events declared disasters by competent state or federal authorities.

"(b) The costs, including capital costs, recorded in the accounts set forth in subdivision (a) shall be recoverable in rates following a request by the affected utility, a commission finding of their reasonableness, and approval by the commission. The commission shall hold expedited proceedings in response to utility applications to recover costs associated with catastrophic events."

Resolution E-3238, adopted July 24, 1991, issued in response to the repair work necessitated by the Loma Prieta earthquake, predated Section 454.9, but is consistent with it.