ALJ/BMD/tcg Mailed 12/3/2004
Decision 04-12-010 December 2, 2004
BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA
Application of Southern California Edison Company (U 338-E) for Authority to Recover Capital Additions to its Fossil Generating Facilities Made Between January 1, 1997 and March 31, 1998 or the Date of Divestiture for Those Generating Facilities Divested by July 8, 1998 and Related Substantive and Procedural Relief. |
Application 99-04-024 (Filed April 19, 1999) |
OPINION GRANTING INTERVENOR COMPENSATION
TO THE UTILITY REFORM NETWORK FOR
SUBSTANTIAL CONTRIBUTIONS TO DECISION 04-02-025
This decision awards The Utility Reform Network (TURN) $103,741.20 for its contribution to Decision (D.) 04-02-025.
Background
D.04-02-025 adopted $52,216,000 in non-nuclear generation plant capital additions (hereinafter referred to as capital additions) for Southern California Edison Company (Edison) that were added to rate base in 1997 through July 8, 1998. Pub. Util. Code § 3671 provides the standard and requirements for an electric utility to receive cost recovery through the competition transition charge (CTC) for capital additions incurred after 1995. D.97-09-048 adopted an after-the-fact reasonableness review to determine whether, and how much, utilities should recover for post-1995 capital additions. The reasonableness review mechanism allowed Edison to make the capital additions prior to resolution of ratemaking treatment. Edison made capital additions to oil and gas fired plants that Edison later sold at a net gain or a net loss, and to plants that Edison retained, including coal-fired and hydroelectric plants.
Edison filed this proceeding to recover $83,153,000 in capital additions made between 1997 and July 8, 1998. Edison segregated the capital additions into six categories: 1) reliability and obsolescence projects, 2) regulatory compliance requirements, 3) maintenance of a safe working environment, 4) Federal Energy Regulatory Commission (FERC) hydroelectric requirements, 5) new market structure metering, and 6) projects required for divestiture of fossil-fired generation facilities. TURN and the Office of Ratepayer Advocates (ORA) filed protests to Edison's proposed ratemaking treatment for certain capital additions. TURN and ORA argued that the capital additions did not comply with Pub. Util. Code § 367,2 and the standards established by D.97-09-048. Following hearings in March 2000, the Legislature amended Section 377 in January 2001 to require that utilities retain any plant not yet divested, and to prohibit the disposal of retained generation plant until January 1, 2006. On October 2, 2001, Edison and the Commission entered into a Settlement Agreement that established new balancing accounts including the Non-Nuclear Generation-related Capital Additions Memorandum Account (NGCAMA), which records amounts for taxes and returns on the capital additions through December 31, 2001.
On September 9, 2002, capital additions related to reliability and obsolescence projects in retained plants were removed from this proceeding and addressed in Application (A.) 02-05-004, Edison's general rate proceeding. The total amount of capital additions considered in A.02-05-004 was $30,937,000, and the amount of capital additions considered in this proceeding was $52,216,000.
D.04-02-025 adopted in full Edison's requested capital additions of $52,216,000, including $31,782,000 for environmental, regulatory, safety, and FERC relicensing projects, $10,528,000 for oil and gas plants divested at a net gain, and $9,906,000 for oil and gas plants divested at a net loss. D.04-02-025 allowed recovery of environmental, regulatory, safety, and FERC relicensing capital additions, as TURN and ORA reviewed these capital additions and did not disagree with their recovery. D.04-02-025 also allowed recovery of capital additions in divested plants, finding that these capital additions contributed to the reliability and maintenance of plant through December 2001. These costs were disputed by TURN. As a result of D.04-02-025, Edison was authorized to recover the return and taxes on capital additions that were recorded in a separate account.
On March 22, 2004, TURN filed an application for rehearing of D.04-02-025 which remains is pending.
On April 15, 2004, TURN filed its request for compensation for its substantial contribution to D.04-02-025. TURN requests $103,651.20 in attorney fees, expert witness costs, and other costs.
1 All references are to the California Pub. Util. Code unless otherwise noted. 2 Section 367 provides that capital additions made during a transition period must be those necessary to maintain the facilities through December 31, 2001. The transition period anticipated that generation plants would be sold pending the beginning of a competitive electric market. All references are to the California Pub. Util. Code unless otherwise noted.
