6. Impact of Other Proceedings

Resolution E-3238 states "[r]ecovery may be limited by consideration of the extent to which losses are covered by insurance, the level of losses already built into existing rates, and possibly other factors relevant to the particular utility and event. Before authorizing recovery from customers of any costs, the Commission will examine how they relate to the overall costs currently authorized for these types of repairs." (Pp. 2-3.) In accordance with this requirement, PG&E identified the following proceedings or cost recovery mechanisms which could affect the level of CEMA recovery included in this application. PG&E states that its CEMA request has been adjusted to remove all costs currently reflected in rates.

H. GRC Proceedings

Since 1991, PG&E filed and received decisions in its 1993 and 1996 GRC proceedings. PG&E also received a decision in its 1999 GRC (D.00-02-046). GRCs provide base revenue changes, including those related to capital additions and operations and maintenance (O&M) expenses. As previously stated, PG&E removed straight-time labor costs associated with expenses from its CEMA request. PG&E also reviewed the GRC adopted revenue requirements to determine if expense and capital-related costs were included in the adopted rate level.

PG&E states that for the Oakland-Berkeley Hills fire, it did not include the capital-related and expense costs associated with the fire in its 1993 or 1996 GRC requests; therefore, these costs were not included in either GRC base revenue changes. The capital-related and expense costs associated with the fire were included in the 1999 GRC request. For the Calaveras/Shasta fires, the 1994 Northridge earthquake, and the January and March 1995 storms, the authorized base revenue change in the 1996 test year GRC did not reflect capital-related or expense costs associated with these disasters. With respect to the February 1998 storms and the 1997 New Year's flood, the disasters occurred subsequent to PG&E's development of its 1999 GRC request. Additionally, due to electric and gas restructuring, PG&E states that electric generation costs and gas transmission costs are not included in the 1999 GRC request. PG&E points out that the revenue requirements adopted in the GRCs are based on normal operations, and do not include forecasts of catastrophic events.

I. Non-Nuclear Generation Capital Additions
Filing

Pursuant to D.97-09-048, on July 30, 1998, PG&E submitted A.98-07-058 for recovery in the Transition Cost Balancing Account (TCBA) of capital additions made in 1997 and the first quarter of 1998 for hydroelectric, fossil and geothermal plants.⁶ According to PG&E, the generation-related CEMA costs included in its CEMA filing reflect costs (and resultant revenue requirements) for which PG&E did not receive recovery during 1997 and the first quarter of 1998 when generation costs were recovered as part of GRC base rates. The time period associated with the revenue requirement for which PG&E is seeking CEMA recovery is not part of A.98-07-058. The capital additions filing will establish the level of recovery of capital in the TCBA effective April 1, 1998. PG&E states that, as a result, its CEMA request does not include revenue requirements that will result from the Commission's ruling in PG&E's capital addition filing.

J. Assembly Bill (AB) 1890 Section 368(e)
Funds

As a result of AB 1890, PG&E received a base revenue increase in 1997 and 1998 (adjusted for inflation which is measured by the consumer price index, plus 2%) for funds to be used to enhance transmission and distribution system safety and reliability. As previously stated, in April 1998, the Federal Energy Regulatory Commission assumed jurisdiction for transmission facilities. As a result, for transmission facilities, Section 368(e) fund coverage expired on March 31, 1998.

PG&E states that to the extent there is an overlap in the costs for work orders that are recovered from Section 368(e) funds and the CEMA costs for 1997 and 1998, PG&E has removed those dollars from its CEMA request.