VI. Comments on Proposed Decision

PG&E and ORA submitted timely comments on the ALJ's draft decision. In response to the comments we agree with PG&E's clarification that the costs of any hedges that result from this authority should be recorded in a memorandum account. PG&E indicated that this accounting treatment "is consistent with preserving specific ratemaking details for subsequent Commission consideration and allowing the costs to be subject to FAS 71 regulatory accounting." (PG&E Comments, mimeo., p. 5.)

PG&E objected to the extension of authority to the Commission's Financing Team to act concurrently with PG&E's management in determining whether to enter into a hedge transaction. This authority is, however, a consistent extension of the underlying Finance Team authority in D.02-11-030 to assemble a complete financing package and fund the Commission's POR. This present decision ensures the Commission's participation in minimizing the costs that will ultimately be borne ratepayers under our jurisdiction by extending the Financing Team's authority to include negotiating hedging transactions jointly with PG&E, and by allowing the hedging transaction to occur regardless of which POR is confirmed by the Bankruptcy Court. We have also clarified that the Commission's Financing Team for the purposes of interest rate hedges shall be the Commission's General Counsel and Director of the Energy Division.

After careful review and consideration, no other changes are made to this decision as a result of parties' comments.