Assignment of Proceeding
Loretta M. Lynch is the Assigned Commissioner and John S. Wong is the assigned ALJ in this proceeding.
1. D.02-06-023 approved the settlement agreement in Phase II of A.00-06-023.
2. The Commission adopted I.02-11-040 on November 21, 2002, which opened an investigation into the possible causes of high gas border prices.
3. The scoping memo and ruling in this proceeding, issued on January 16, 2003, described what had occurred in I.02-11-040, and ruled that no hearings would be held in this proceeding.
4. The GCIM is designed to provide SoCalGas with a financial incentive for making efficient gas purchasing decisions.
5. SoCalGas acquired gas at a savings of approximately $189.8 million below the GCIM benchmark in Year Eight.
6. Pursuant to the GCIM revisions adopted in D.02-06-023, the shareholder award amount is capped at $17.4 million.
7. SCE does not dispute the calculation of the shareholder award of $17.4 million for Year Eight.
8. SCE's concerns about the GCIM structure have been addressed in D.02-06-023 or will be addressed by the Commission in I.02-11-040.
9. ORA's Monitoring and Evaluation Report for Year Eight verified the amount and calculation of the shareholder award.
10. I.02-11-040 states that the Commission may modify or eliminate the GCIM, reduce the amount of the shareholder award for the period involved, or order the respondents to issue a refund to ratepayers.
11. ORA's Monitoring and Evaluation Report for Year Eight analyzed and evaluated the reasonableness of SoCalGas' gas operations for the period.
12. SoCalGas reasonably managed its gas acquisitions and operations in Year Eight within the context of the GCIM that existed at the time.
13. The calculation and amount of SoCalGas' shareholder award for Year Eight are correct.
1. Today's finding regarding the reasonableness of SoCalGas' management of its gas acquisitions and operations in Year Eight shall not prejudge what the Commission may find or conclude in I.02-11-040.
2. In accordance with the GCIM modifications adopted in D.02-06-023, SoCalGas is entitled to a shareholder award of $17,388,157 for Year Eight of the GCIM.
3. Due to ongoing activities in I.02-11-040, the Commission may adjust the shareholder award for Year Eight if that investigation reveals that the conduct of the respondents to the investigation contributed to the price spikes at the California border.
4. SoCalGas should be awarded a shareholder award of $17,388,157 for Year Eight of its GCIM, subject however to refund or adjustment, as may be determined in I.02-11-040.
5. SoCalGas should be permitted to adjust the Purchased Gas Account to reflect the shareholder award of $17,388,157 that may be subject to refund or adjustment.
6. This order should be effective today in order to resolve this matter expeditiously.
IT IS ORDERED that:
1. Southern California Gas Company (SoCalGas) is authorized to adjust the Purchased Gas Account to recognize a shareholder award of $17,388,157 under Year Eight of its Gas Cost Incentive Mechanism.
2. SoCalGas' shareholder award amount of $17,388,157 shall be subject to refund or adjustment as may be determined by the Commission in Order Instituting Investigation 02-11-040.
3. This proceeding is closed.
This order is effective today.
Dated August 21, 2003, at San Francisco, California.
MICHAEL R. PEEVEY
President
CARL W. WOOD
GEOFFREY F. BROWN
SUSAN P. KENNEDY
Commissioners
I dissent.
/s/ LORETTA M. LYNCH
Commissioner
