TABLE OF CONTENTS
Title Page
ABBREVIATIONS AND ACRONYMS v
OPINION 2
I. Summary 2
II. Background 3
III. The Joint Recommendation 5
A. Overview of the Joint Recommendation 7
1. BCAP Period 7
2. Throughput Forecast 7
3. Noncore Risk 7
4. Transmission Resource Plan 8
5. Marginal Cost Methodology 9
6. Core Interstate Capacity and Storage Reservations 9
7. Unbundled Storage Program 10
8. Cost Allocation Associated with Core Deaveraging, Hub Revenues, the Direct Assistance Program, and Incremental Load Growth Opportunities 11
a. Core Deaveraging 11
b. Hub Revenues 12
c. Direct Assistance Program Costs 12
d. Incremental Load Growth 12
B. Adequacy of Representation 13
IV. Length of Periods 16
A. Length of BCAP Period 16
B. Length of the Forecast Period 17
C. Impact of the Joint Recommendation 17
V. Throughput 18
A. Econometric Throughput 18
B. Non-Econometric Throughput 20
C. Revenue Risk 22
D. Gas Price Forecast 23
E. Impact of the Joint Recommendation 23
VI. Long-Run Marginal Costs (LRMC) 24
A. Summary 24
B. NCO/Rental Method 25
C. Replacement Cost Adders 29
D. Customer Costs 33
E. Wholesale Rates 34
F. Distribution Marginal Costs 34
G. Impact of the Joint Recommendation 36
VII. Transmission 38
A. Transmission Marginal Costs 38
B. Resource Plan 39
C. Line 6900 43
D. Impact of the Joint Recommendation 45
VIII. Electric Generation 46
A. Single EG Rate for Both Utilities 46
B. EG Rate Segmentation 52
C. Anti-gaming Mechanism 55
D. Public Purpose Programs 56
E. The CPUC Fee 57
IX. ITCS and Interstate Capacity 57
A. Summary 57
B. Core Capacity Reservation Costs 58
C. Allocation of ITCS 61
D. Forecast of ITCS Costs 63
E. Amortization of ITCS 64
F. Transwestern TCR Surcharges 65
G. Impact of the Joint Recommendation 66
X. Wheeler Ridge 67
XI. Storage 70
A. Summary 70
B. Storage Marginal Costs 71
C. Core Withdrawal Reservation 72
D. Noncore Storage Balancing Account 74
E. Impact of the Joint Recommendation 76
XII. Other Operating Costs 79
XIII. System "Window" Procedures 80
XIV. Hub Services 81
XV. RLS Tariff 82
XVI. Regulatory Balancing Accounts 94
XVII. Cost Allocation 97
A. Marginal Cost Estimation 97
B. Establish Base Margin 97
C. Allocation of Base Margin 98
D. Allocation of Non-base Margin Costs 99
E. Care and DAP 99
1. CARE Costs 99
2. DAP Costs 101
F. DGN Contract 102
XVIII. Rate Design 103
A. Residential Rate Issues 103
1. Customer Charge 103
2. Tier Differential 105
3. Baseline Allowances 107
4. Core Deaveraging 108
5. Master Meter Issues 108
B. Core Commercial/Industrial Rate Issues 113
C. Noncore Commercial and Industrial Rate Design 113
1. Rate Design 113
2. Special Treatment for Red Team and Rule 38 Contracts 114
D. Rate Design Window 114
E. Impact of the Joint Recommendation 115
XIX. Other Issues 116
A. PBOP 116
B. Customer Satisfaction Under 1997 PBR 116
C. QF Restructuring 116
D. Interstate Pipeline Refunds 117
XX. Issues Local to SDG&E 117
A. Throughput Forecast 119
B. Resource Plan 120
C. Marginal Costs 120
1. Marginal Customer Costs 120
2. Demand Costs 121
3. Distribution Marginal Costs 121
4. Transmission Marginal Costs 121
D. EG Rate Design 122
E. Sempra-Wide EG Rate 123
F. Rosarito Loads 123
G. Marginal Cost Calculations 123
H. Core Deaveraging and Global Settlement Credits 123
I. CARE and DAP 124
J. Baseline Rates 124
K. Master Meter Issues 125
L. Core Commercial and Industrial 126
M. Natural Gas Vehicle (NGV) Rates 126
N. Noncore Rate Design 127
O. Schedule XGTS 128
XXI. Comments to the Proposed Decision 131
Findings of Fact 137
Conclusions of Law 155
ORDER 156
Appendix A SoCalGas Joint Recommendation
Appendix B SDG&E Joint Recommendation
Appendix C SDG&E-WMA Joint Recommendation
Appendix D SoCalGas Rates and Allocations
Appendix E SDG&E Rates and Allocations
Appendix F Appearances
NAMES |
ABBREVIATIONS AND ACRONYMS |
Administrative and General |
A&G |
Administrative Law Judge |
ALJ |
Automatic Meter Reading |
AMR |
Biennial Cost Allocation Proceeding |
BCAP |
California Cogeneration Council and Watson Cogeneration Company |
CCC/Watson |
California Energy Commission |
CEC |
California Gas Report |
CGR |
California Industrial Group and California Manufacturers Association |
CIG/CMA |
certificate of public convenience and necessity |
CPC&N |
City of Long Beach |
LB |
City of Vernon |
Vernon |
Cogenerator Gas Allowance |
CGA |
Commercial and Industrial |
C&I |
Competition Transition Costs |
CTCs |
Core Fixed Cost Account |
CFCA |
Demand Side Management |
DSM |
Department of General Services |
GS |
Direct Assistance Program |
DAP |
Distribuidora de Gas Natural de Mexicali |
DGN |
Division of Ratepayer Advocates |
DRA |
El Paso Natural Gas Company |
El Paso |
Electric Generation |
EG |
Electric Generator Alliance |
EGA |
Electric Vehicles |
EV |
Enhanced Oil Recovery |
EOR |
Equal Percent of Marginal Cost |
EPMC |
Federal Energy Regulatory Commission |
FERC |
Gas Cost Incentive Mechanism |
GCIM |
Gas Industry Restructuring |
GIR |
Heating Degree Days |
HDD |
NAMES |
ABBREVIATIONS AND ACRONYMS |
High Pressure Distribution |
HPD |
High-pressure Distribution Service |
HPS |
Independent System Operator |
ISO |
International Border |
IB |
Interstate Transition Cost Surcharge |
ITCS |
Joint Recommendation (SoCalGas) |
JR |
Kern River and Questar |
the Pipelines |
Kern River Gas Transmission Company and Questar Southern Trails Pipeline Company |
Kern River |
Lodi Gas Storage |
Lodi |
Long Run Marginal Cost |
LRMC |
Low Emission Vehicles |
LEV |
Marginal Demand Measure |
MDM |
Medium-pressure Distribution Service |
MPS |
Monsanto Company |
Monsanto |
Natural Gas Vehicle |
NGV |
New Customer Only |
NCO |
Noncore Commercial and Industrial |
Noncore C&I |
Noncore Storage Balancing Account |
NSBA |
Office of Ratepayer Advocates |
ORA |
Pacific Gas and Electric Company |
PG&E |
Performance Based Ratemaking |
PBR |
Power Exchange |
PX |
Qualifying Facility |
QF |
Real Economic Carrying Charge |
RECC |
Real Time Pricing |
RTP |
reliability must-run |
RMR |
Residual Load Service |
RLS |
San Diego Gas & Electric Company |
SDG&E |
SDG&E/WHA Joint Recommendation |
SDG&E JR |
Service Line, Regulator, and Meter |
SRM |
Southern California Edison Company |
SCE |
Southern California Gas Company |
SoCalGas |
NAMES |
ABBREVIATIONS AND ACRONYMS |
Southern California Generation Coalition |
SCGC |
The Utility Reform Network |
TURN |
Transition Cost Balancing Account |
TCBA |
Transition Cost Recovery |
TCR |
Transmission-only |
TLS |
Transwestern Pipeline Company |
Transwestern |
Ultramar, Inc. |
Ultramar |
Utility Consumers' Action Network |
UCAN |
Utility Electric Generator |
UEG |
Western Hub Properties, Inc. |
WHP |
Western Mobilehome Park Owners Association |
WMA |
Zone Rate Credit |
ZRC |
Decision 00-04-060 April 20, 2000
BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA
In the Matter of the Application of SOUTHERN CALIFORNIA GAS COMPANY for Authority to Revise its Rates Effective August 1, 1999, in its Biennial Cost Allocation Proceeding. (U904 G) |
Application 98-10-012 (Filed October 1, 1998) |
|
In the Matter of the Application of SAN DIEGO GAS & ELECTRIC COMPANY for Authority to Revise its Gas Rates Effective August 1, 1999, in its Biennial Cost Allocation Proceeding. (U902 G) |
Application 98-10-031 (Filed October 15, 1998) |
I. Summary
In the Southern California Gas Company (SoCalGas) section of this decision we approve a Joint Recommendation sponsored by SoCalGas, the Office of Ratepayer Advocates (ORA) and others which adopts, among other issues: (1) a three-year Biennial Cost Allocation Proceeding (BCAP) period, (2) a throughput forecast of 950.3 MMdth, (3) 75/25 balancing account protection for noncore throughput variation , (4) a transmission resource plan of $32.5 million, (5) the new customer only (NCO) marginal cost method, (6) 50/50 balancing account protection for storage, and (7) a delay in core deaveraging. Rates are reduced by $158.9 million for the core and $50.7 million for the noncore. The average winter monthly residential bill is reduced from $84.75 to $79.19.
In the San Diego Gas & Electric Company (SDG&E) section of this decision we approve a Joint Recommendation sponsored by SDG&E, ORA, and the Utility Consumers' Action Network (UCAN) which adopts, among other issues: (1) a throughput forecast of 480 million therms for former Utility Electric Generator (UEG) customers, (2) a $31 million gas transmission resource plan, (3) the NCO marginal cost method for customer costs, (4) a single tariff schedule for core commercial and industrial customers, and (5) elimination of schedule XGTS. Core rates are reduced $18 million; noncore rates are reduced $18.7 million. The average winter monthly residential bill is reduced from $27.44 to $26.46.
The interstate transition cost surcharge (ITCS)is found to be $59.894 million and allocated $11.559 million to the core and $48.335 million to the noncore. The core fixed cost account (CFCA) is found to be overcollected by $132 million, to be amortized in rates over a one-year period. (This $132 million is included in the overall $158.9 million core rate reduction.) We find that it is in
the public interest to adopt a Sempra-wide electric generation (EG) tariff, that is, one that is the same for SoCalGas' EG customers and SDG&E's EG customers. We continue in effect SoCalGas' residual load service (RLS) tariff for not more than one year from the effective date of this decision, or until a replacement peaking rate is adopted, whichever is later.
