d) Public Utilities Code Sections 495.7 and 454

Finally, TURN and DRA contend that the elimination of geographic averaging contravenes sections 495.7 and 454. Section 495.7 states that the Commission may "establish procedures to allow telephone or telegraph corporations to apply for the exemption of certain telecommunications services from the tariffing requirements in sections 454, 489, 491, and 495." Section 454 requires that "no public utility shall change any rate...except upon a showing before the commission and a finding by the commission that the new rate is justified."

TURN and DRA argue that in permitting unfettered geographic deaveraging, the Decision granted carriers absolute freedom to modify rates currently in effect, yet no specific rates have been submitted for review. According to TURN and DRA, the Commission has not issued any findings regarding specific geographically deaveraged rates, in conflict with section 454. Nor has the Commission made findings pursuant to section 495.7 that are based on an analysis of market power in the geographic area to which rate increases would apply. TURN and DRA allege that this failure constitutes legal error.

We find TURN and DRA's arguments are without merit. Neither of these code sections prohibit geographically deaveraged prices. Moreover, TURN and DRA's argument that the Commission has failed to make findings under section 495.7 is premature, as discussed in below. In addition, we have accumulated a substantial record in this proceeding to support our conclusion that price regulation is not required to ensure that prices are just and reasonable under the law.²¹

²¹ Moreover, carriers and ratepayers may file a complaint in court or with the Commission to demonstrate that a carrier's rates are not just and reasonable because of that carrier's pricing practices.