V. Substantial Contribution to Resolution of Issues
In evaluating whether a customer made a substantial contribution to a proceeding, we look at several things. First, did the ALJ or Commission adopt one or more of the factual or legal contentions, or specific policy or procedural recommendations put forward by the customer? (See § 1802(h).) Second, if the customer's contentions or recommendations paralleled those of another party, did the customer's participation materially supplement, complement, or contribute to the presentation of the other party or to the development of a fuller record that assisted the Commission in making its decision? (See §§ 1802(h) and 1802.5.) As described in § 1802(h), the assessment of whether the customer made a substantial contribution requires the exercise of judgment.
In assessing whether the customer meets this standard, the Commission typically reviews the record, composed in part of pleadings of the customer and, in litigated matters, the hearing transcripts, and compares it to the findings, conclusions, and orders in the decision to which the customer asserts it contributed. It is then a matter of judgment as to whether the customer's presentation substantially assisted the Commission.2
Even where the Commission does not adopt any of the customer's recommendations, compensation may be awarded if, in the judgment of the Commission, the customer's participation substantially contributed to the decision or order. For example, if a customer provided a unique perspective that enriched the Commission's deliberations and the record, the Commission could find that the customer made a substantial contribution.3 With this guidance in mind, we turn to the claimed contributions Aglet-TURN made to this proceeding.
A. AGLET-TURN's Argument on Substantial Contribution
Aglet-TURN were the only party that opposed an 11.60% ROE requested by SCE and supported by ORA. Although Aglet-TURN's 10.60% recommended ROE was not adopted, their financial model results and ROE recommendation were used in the adoption of a broad ROE range based on their model and SCE's. Using that broad ROE range, we adopted a test year 2005 ROE of 11.40%, which is lower than the 11.60% ROE requested by SCE and supported by ORA. See Findings of Fact 31, Conclusion of Law 16, and Ordering Paragraph 1 of D.04-12-047.
Aglet-TURN also claimed a substantial contribution in regards to PG&E's 2005 ROE. ORA joined Aglet-TURN in opposing PG&E's requested 11.60% ROE for test year 2005. Similar to SCE, the adoption of a broad ROE range was based on the financial model results of PG&E, Aglet-TURN and ORA. We adopted a test year 2005 ROE of 11.22%, which is lower than the 11.60% ROE requested by PG&E. Aglet-TURN's substantial contribution here is shown in Findings of Fact 31, Conclusion of Law 18, and Ordering Paragraph 3 of
D.04-12-047.
Aglet-TURN also claimed a substantial contribution in regards to debt equivalence. Although SCE, PG&E, and SDG&E request approval of a specific method for calculating the debt equivalence effects of purchased power contracts on credit quality, ORA, the CAC, and Aglet-TURN opposed a formulaic approach and recommended that debt equivalence be considered on a case-by-case basis. In that regard, the Commission specifically concurred with ORA and Aglet-TURN as discussed on page 7 and set forth in Conclusion of Law 8 of
D.04-12-047. Further, that decision adopted specific debt equivalence findings and conclusions testified to by Aglet-TURN, many of which were cited without change in the decision. See Findings of Fact 7 and 8, which repeat the recommendations of Aglet-TURN without change, and Findings of Fact 9 and 14 of D.04-12-047.
As stated by Aglet-TURN in their joint compensation request, their evidence and arguments on market conditions, trends, creditworthiness, interest rate forecasts, quantitative financial models based on subjective inputs and risk factors, and their debt equivalence testimony have assisted us in this proceeding. In fact, every substantive position advocated by Aglet-TURN affected
D.04-12-047, even where (as is commonly the case in cost of capital proceedings) our adopted ROE falls somewhere between the ROE requested by the utility and that recommended by Aglet-TURN. We find that Aglet-TURN jointly made a substantial contribution to D.04-12-047.
