12. Rate Design

12.1 Baseline Quantities of Gas

Under Pub. Util. Code § 739(d)(1), the Commission must set baseline quantities of gas for residential customers at an amount between 50% to 60% of average residential use in the summer and 60% to 70% in winter. The current baseline quantities are calculated for Catalina gas customers at 60% summer and 70% winter, consistent with SCE's last general rate case. ORA proposes, and SCE does not object, that the Commission continue to use the existing baseline quantities for the next three years. Our order today so provides.

12.2 Allocation of Rates

SCE proposes that increased rates be spread equally over the fixed meter charge and volume rates. ORA recommends that the increase be allocated 15% to the fixed portion of the bill and 85% to volume. ORA contends that this allocation will give customers - particularly residential customers - more control over gas charges, since reduced use will result in a reduced bill. In the absence of evidence challenging the reasonableness of this approach, we adopt ORA's allocation of rates between fixed meter (customer) charge and volumetric rates.

12.3 Domestic CARE Rates

Both SCE and ORA support extension of the California Alternate Rates for Energy (CARE) discounts for Catalina low-income domestic gas service. Under the program, customers qualifying for the CARE program for electric service are enrolled automatically for the proposed CARE schedule for gas service, Schedule G-CARE. Such customers receive a 20% discount in service rates. Approximately 160 Catalina gas customers who participate in the electric CARE program will be eligible for G-CARE. The low-income program reallocates the approximately $16,000 cost, and there is no impact on overall revenue requirements.