14. Public Utilities Code Section 783
Section 783 addresses Commission consideration of a decision amending rules governing the extension of services provided by an electric or gas corporation to new customers. It requires the Commission, with the assistance of various other state agencies, to make written findings on seven issues specified therein. The issues address the effect of the rule change on various types of customers, employment, residential and non-residential development and redevelopment, and energy consumption and conservation. Section 783 also provides that the decision shall take effect on July 1 of the year following its adoption.
14.1. Positions of Parties
PG&E states that, since it does not seek to amend its existing Rules 15 and 16, but seeks authority under the exceptional case provisions of those rules, § 783 does not apply.
TURN states that § 783 applies because PG&E's proposal is a change to Rules 15 and 16 that could result in ratepayers paying for non-refundable line extension costs that were previously paid by the applicant for the line extension under the current Rules 15 and 16.
CCSF states that § 783 applies to this application because PG&E's proposal is a change to Rules 15 and 16 that are intended to apply on a case-by-case basis.
MID says the exceptional cases provisions of Rules 15 and 16 are normally meant to apply to single special circumstance transactions and not to a general set of circumstances. MID argues that this application is not merely designed to give effect to periodic review of provisions of existing rules. MID also points out that this application is unprecedented. MID (referring to TURN's brief) states that PG&E's proposal is a change to Rules 15 and 16 because it could result in ratepayers paying for non-refundable line extension costs that were previously paid by the applicant. For these reasons MID states that § 783 applies to this application.
NCPA states that by amending the agreements that underlie Rules 15 and 16, PG&E is requesting a major change to those rules.
14.2. Discussion
PG&E's Electric Rule 15.I.3 states:
"When the application of this rule appears impractical or unjust to either party, or ratepayers, PG&E or Applicant may refer the matter to the Commission for a special ruling or for approval of special condition(s) which may be mutually agreed upon."20
The above language refers to a single "Applicant." Rule 15.J and Rule 16.H define "Applicant" as follows:
APPLICANT: A person or agency requesting PG&E to supply electric service.
Thus the term "Applicant" is singular.
From the above language, we conclude that the exceptional case provisions of Rules 15 and 16 apply to a single contract between PG&E and a single person or agency. Thus, each such contract involving an exceptional case would be viewed separately. PG&E's proposal would involve an unspecified number of future contracts each of which is likely to have a different incentive and may have a different compliance period. Thus, we find PG&E's proposal does not fall within the exceptional case provisions of Rules 15 and 16. If we were to grant PG&E's application, it would require a change to PG&E's rules, triggering § 783.
15. Comments on Proposed Decision
The proposed decision of the ALJ in this matter was mailed to the parties in accordance with Section 311 of the Public Utilities Code and Rule 14.3 of the Commission's Rules of Practice and Procedure. Comments were filed by PG&E on November 26, 2007, and reply comments were filed on December 3, 2007, by DRA, TURN, MID, CCSF, and NCPA. All comments were considered.
Dian M. Grueneich is the assigned Commissioner and Jeffrey P. O'Donnell is the assigned ALJ in this proceeding.
1. Since there is no significant need for the incentive proposal and the incentives would likely disadvantage some new customers, it would not be good public policy to grant PG&E's application.
2. PG&E's proposal is not practical to implement.
3. PG&E's Rules 15.I.3 and 16.G (exceptional case) provide that when application of the rule appears impractical or unjust to either party (PG&E or the applicant) or the ratepayers, PG&E or the applicant may refer the matter to the Commission for a special ruling or for special conditions which may be mutually agreed upon that allow PG&E to deviate from its standard line extension requirements.
4. PG&E has provided no estimate of the amount of revenues it will fail to obtain in future years due to developers choosing a POU over PG&E or the revenues it will gain if this application is approved.
5. The amount of revenues from customers PG&E claims to have failed to obtain over the last few years amounts to 0.17% of its total annual revenues.
6. The record does not indicate the exact number of years over which the 0.17% loss of revenues occurred but it appears to be between 2001 and 2005, or about 0.034% per year.
7. If the potential for developers to choose a POU over PG&E remains at 0.034% of revenues per year, and the incentive proposal would allow PG&E to attract all new developments that could choose a POU, it would take approximately 29 years for the incentives to have a 1% effect on PG&E's annual revenues.
8. If the potential for developers to choose a POU over PG&E is 0.05% of revenues per year, and the incentive proposal would allow PG&E to attract all new developments that could choose a POU, it would take approximately 20 years for the incentives to have a 1% effect on PG&E's annual revenues.
9. PG&E does not claim that the incentives would capture all new developments.
10. If the potential for developers to choose a POU over PG&E is 0.034%-0.05% of revenues per year, and the incentive proposal would allow PG&E to attract half of the new developments that could choose a POU, it would take approximately 40-58 years to have a 1% effect on PG&E's revenues.
11. If the potential for developers to choose a POU over PG&E is 0.034%-0.05% of revenues per year, the incentive proposal would allow PG&E to attract half of the new developments that could choose a POU, the CTM per customer from the customers the incentive is intended to attract is the same as from existing customers and a change in revenues would result in the same percentage change in CTM, it would take approximately 40-58 years to have a 1% effect on PG&E's CTM.
12. The record does not indicate that the lack of the incentives would have a significant adverse effect on revenues or CTM, or that the incentives would have a significant positive effect.
13. PG&E has not addressed whether improvements to the 50% nonrefundable discount option or its promotion could reduce or eliminate the alleged need for its incentive proposal.
14. PG&E has not addressed whether improvements to third party installation or its promotion could reduce or eliminate the alleged need for its incentive proposal.
15. The record demonstrates that service to developers is an important factor in competing with the POUs.
16. The record contains some anecdotal evidence indicating that at least some developers have been dissatisfied with PG&E's service and that PG&E intends to improve such service.
17. PG&E has not addressed the degree to which service to developers can be improved, and to what degree such improvement could reduce or eliminate the alleged need for PG&E's incentive proposal.
18. The record demonstrates that PG&E and the POUs have different advantages and disadvantages over each other but PG&E has not provided evidence that quantifies or otherwise demonstrates that POUs have a significant overall net advantage over PG&E.
19. The record does not support PG&E's claim that incentives are necessary to overcome any significant advantage held by the POUs.
20. PG&E has not provided evidence that demonstrates that the delay it may encounter in obtaining the Commission's approval of a tariff deviation is significantly greater than the delay the POU may encounter.
21. PG&E has not demonstrated that any difference in the delay it or a POU may encounter in obtaining approval of a deviation from its tariffs has been a significant factor in developers choosing the POU rather than PG&E.
22. In D.92-11-052, the Commission stated "Bypass is uneconomic when a customer leaves the utility system even though its cost to bypass is more than the marginal cost of utility service."
23. The term uneconomic bypass applies to the loss of an existing customer.
24. D.92-11-052 pertained to rate discounts for the transportation of natural gas.
25. D.92-11-052 stated "Discounts to prevent uneconomic bypass can attract or retain incremental load which would otherwise be lost, and thus help to keep other rates down." This means that discounts intended to deter uneconomic bypass could also have the effect of attracting incremental load.
26. In this case, the developer makes the decision about whether to take service from PG&E, but the developer is not ultimately the customer.
27. PG&E's application does not address the costs to the new customer to bypass.
28. PG&E has not done the necessary analysis to demonstrate that new customers being served by a POU rather than PG&E constitute uneconomic bypass.
29. The Commission's statement in D.92-11-052 that "Bypass should only be prevented if it is uneconomic" means that rate discounts should not be offered in the case of economic bypass, which occurs when the customer's cost to bypass is less than the utility's marginal cost to provide service.
30. If we were to accept PG&E's claim that developers choosing a POU over PG&E could fit within the definition of uneconomic bypass, there could be economic bypass in such circumstances.
31. If we were to accept PG&E's claim that developers choosing a POU over PG&E could fit within the definition of uneconomic bypass, PG&E has not done the necessary analysis to demonstrate that new customers being served by a POU rather than PG&E would not constitute economic bypass.
32. PG&E has not demonstrated that this application addresses uneconomic bypass.
33. Since PG&E has not demonstrated that its proposal will have a significant positive effect on CTM or rates, that it is effectively using other tools available to it to compete with POUs, that POUs have significant advantages over PG&E, or that its proposal will reduce uneconomic bypass, it has not demonstrated a need for its proposed incentives.
34. New customers would not usually be the recipients of the incentives, but would be the ratepayers that provide the CTM necessary to justify the proposed incentives.
35. The incentives would be given primarily to developers.
36. The RIM test is generally used for evaluating load building programs.
37. Since most load building programs offer an incentive to the customer and the customer can choose whether to participate in the program, a customer who chooses to participate can be assumed to benefit from the program.
38. The RIM test calculates the effect of the program on ratepayers who pay for the program through rates, but do not participate in the program.
39. Since PG&E's proposed incentive would usually be paid to the developer and not the new customer, the new customer can not be assumed to benefit from PG&E's proposal.
40. While the RIM test is appropriate for determining the effect on the existing ratepayers, it does not address the effect on the new customers.
41. The TRC test determines the effect on existing and new customers in the aggregate and could indicate that the program is beneficial to customers as a whole, even though new customers could be worse off.
42. D.82-04-069 stated that "any request or proposal which ostensibly promotes the benefit of the majority at the expense of a minority interest requires substantial justification."
43. The TRC test, since it aggregates new and existing customers, does not justify promoting the benefit of the majority at the expense of a minority interest.
44. PG&E has presented no analysis or quantification of the effect of the incentives on new customers or existing customers.
45. PG&E has not shown how modest the effect of its proposal on new customers would be or how substantial the effect on existing customers would be.
46. The record shows that in many cases the POU's rates are lower than PG&E's rates and, in some cases quite a bit lower.
47. The adverse effect of PG&E's proposal on some new customers may not be minimal and could be substantial.
48. PG&E has not demonstrated that it would be good policy to disadvantage some new customers to achieve a minimal advantage to existing customers.
49. If we were to grant the application, additional issues regarding the CTM calculation would have to be addressed.
50. The fact that we do not address additional issues regarding the CTM calculation in this decision does not mean that we would make no changes to the incentive calculation or the inputs thereto if we were to grant the application, or that further analysis would not reveal additional reasons to deny it.
51. In PG&E's 2007 GRC (D.07-09-004), the Commission adopted a settlement.
52. Settlements are not generally intended to constitute a precedent regarding any principal or issue for use in any other proceeding.
53. One of the agreed-upon purposes of the marginal costs adopted in the settlement is for establishing "customer-specific contract rate floors for customer retention and attraction."
54. In this proceeding we are not dealing with rates, much less rate floors, and the incentive would primarily be offered to developers who are not customers.
55. The record does not indicate that the marginal costs adopted in the 2007 GRC settlement were intended by the parties to the settlement or the Commission for use in this proceeding or in calculating incentives.
56. Marginal costs would be a potential issue in the reasonableness review that could add significantly more controversy and complexity to the reasonableness review.
57. The PPP revenue requirement is determined in GRC's, and does not change until the next GRC.
58. PPP costs may not be reflected in rates until the first GRC after the incentive is awarded.
59. In subsequent GRCs, PPP costs would be included in the historical costs on which the GRC forecasts would be based and would be recognized in the rates resulting from the subsequent GRC.
60. PPP costs should be included in the CTM calculation and PG&E has not done so.
61. The record does not indicate how to include PPP costs in the CTM calculation.
62. PG&E's assumption that costs and revenues will remain static over the 30-year period would tend to understate the CTM if both escalate at the same rate.
63. The record does not demonstrate how revenues and marginal costs have escalated historically or how they will do so in the future.
64. PG&E's assumption that costs and revenues will remain static over the 30-year period has not been shown to be reasonable or to understate the CTM.
65. At least some single family homes and multi-family homes will likely be rented over the 30-year CTM analysis period to customers who qualify for the CARE program.
66. PG&E's CTM calculation does not address the possibility that there will be CARE customers later in the 30-year analysis period.
67. The record does not reflect how sizable CARE participation will be.
68. Since the incentive calculations would be specific to each development, CARE participation would have to be addressed in the reasonableness review adding to the complexity of such proceedings.
69. Since PG&E's proposal will have to be administered, there will be administrative costs and reasonableness review costs.
70. Costs related to determining whether the applicant qualifies for the incentive and whether PG&E will offer the incentive have been charged to Account 912, which has not been funded by the Commission in a number of GRCs.
71. PG&E's exhibits do not address administrative costs.
72. The record does not indicate whether the revenue requirement adopted in PG&E's 2007 GRC excluded Account 912 costs or whether all costs related to administration of the proposal would be charged to Account 912.
73. PG&E has not proposed in this proceeding that administration costs related to this proposal, whether charged to Account 912 or not, be born exclusively by shareholders in the future.
74. PG&E has not demonstrated that there would be no administrative costs that should be included in the CTM calculation.
75. Since the Commission's reasonableness review costs, at least part of PG&E's costs and costs incurred by intervenors eligible for intervenor compensation are recovered from ratepayers, reasonableness review costs would be paid, at least in part, by PG&E's ratepayers.
76. Reasonableness review costs will reduce any CTM generated by the incentives.
77. PG&E has provided no estimate of reasonableness review costs and does not include them in its CTM calculation or otherwise in its proposal.
78. Without a reasonable CTM calculation, the proposed incentive program can not be implemented.
79. PG&E's proposal could provide an incentive for a development that would be estimated to produce a CTM as low as $1 over a 30-year period.
80. With a CTM as low as $1, existing ratepayers would essentially break even over a 30-year period and there would be no reason to offer the incentive and assume the attendant risk that a negative CTM will result.
81. In any forecast of costs and revenues going 30 years into the future, there is a significant margin of error.
82. If a CTM estimate falls within the margin of error it essentially means that there is no real certainty that a positive CTM will be realized.
83. If the estimated CTM is significantly above the margin of error it is more likely that the CTM will be positive.
84. PG&E has provided no forecast of the CTM it believes the incentives are likely to produce or the likely margin of error in its estimates.
85. The existence of administrative and reasonableness review costs will reduce any CTM generated by PG&E's proposal and supports the need for a threshold CTM.
86. PG&E has not proposed a threshold CTM and the record is insufficient to determine what it should be.
87. Since there is a risk, particularly when forecasting costs and benefits 30 years into the future, that PG&E's forecast CTM could be wrong, and PG&E's forecast NPV of the CTM could be as low as $1 for any individual project, the proposed incentives impose a risk on ratepayers.
88. Shareholders will benefit from the incentives because they will have the opportunity to earn a return on their capital investment made to serve the resulting new customers.
89. There is some risk to shareholders regarding the return on investment, but their risk is not directly associated with whether the incentives generate a positive CTM.
90. The record does not indicate that the risk faced by shareholders due to the incentives is as great as the risk faced by ratepayers.
91. One way to reduce the risk to ratepayers, in addition to or instead of a threshold CTM, would be to have shareholders bear some of the incentive program costs.
92. Although having shareholders bear some of the costs associated with the incentives merits consideration as a reasonable way to lessen the risk on ratepayers, the record is not sufficient for us to do so.
93. Key elements of the reasonableness review are determining whether a bona fide POU offer was made and whether PG&E's offer matched, but did not exceed, the POU offer.
94. A copy of the POU's written offer is the best evidence that an offer is bona fide and is also the best evidence of the details of the offer.
95. If a bona fide POU offer is verbal, there would be no written document to include in the affidavit.
96. The record does not indicate how many POU offers are verbal.
97. Without a written offer from the POU, the applicant's representation of the POU offer could not be verified by PG&E in administering the program or by the Commission and parties in the reasonableness review.
98. PG&E's representation that requiring a copy of a written offer would adversely affect the utility of the program means that the incentive program would attract fewer developers and provide less CTM, which tends to support denial of the application.
99. If the written offer requirement is not imposed, the reasonableness review would likely be more controversial, complex and expensive to implement because of the increased difficulty of verifying the POU's offer, especially if it is not in writing.
100. PG&E's proposal not to require a written offer would make the proposal less practical to implement, decrease the resulting CTM, and tends to support denial of the application.
101. The length of PG&E's compliance period, relative to the POU compliance period, would have a value to the applicant that is relevant to ascertaining whether PG&E's offer matches, but does not exceed the POU's offer.
102. PG&E has provided no information explaining how its proposed extended compliance period compares to the compliance periods offered by the POUs or how to value any difference between PG&E's and the POU's compliance periods.
103. The fact that PG&E does deficiency billing, and the POUs do not, has value.
104. PG&E has not addressed how deficiency billing should be valued.
105. PG&E has not proposed a means of assigning a dollar value to any difference in compliance periods or the absence of deficiency billing by the POUs or any other means of considering differences in the compliance period or the absence of deficiency billing by POUs in assessing whether PG&E's offer meets but does not exceed the POU's offer.
106. Without a means of valuing any difference in compliance periods or the absence of deficiency billing by the POUs, we would not be able to ascertain the reasonableness of PG&E's offer.
107. If the compliance period is extended beyond the present requirements, there will be a longer period of time before any positive CTM is realized.
108. The uncertainty of PG&E's CTM estimate increases as the compliance period goes farther out into the future.
109. The risk that the development will not provide a positive CTM will increase as the compliance period is increased, which tends to support the need for a threshold CTM and/or a contribution by shareholders to the cost of the incentives to reduce ratepayer risk.
110. PG&E does not propose to offer the incentive as a standard tariff offering to qualified applicants.
111. PG&E's request for discretion regarding what compliance period to offer the applicant raises the possibility of similarly situated applicants being treated differently.
112. Since PG&E has not explained in any detail what criteria it would use in determining what compliance period to offer an applicant, we can not determine whether offering different compliance periods to similarly situated applicants would constitute unreasonable discrimination.
113. PG&E's request for discretion regarding whether to offer the incentive to an applicant who appears eligible raises the possibility of similarly situated applicants being treated differently.
114. Since PG&E has not explained in any detail what criteria it would use in determining not to offer the incentive to an applicant who appears eligible, we can not determine whether not offering the incentive would constitute unreasonable discrimination.
115. Offering the incentive to applicants who would qualify for the incentive, but would take service from PG&E without the incentive, or should not be offered the incentive or extended compliance period for other reasons, would incur costs with diminished or no corresponding benefits thus reducing the overall CTM provided by the proposal.
116. PG&E has not addressed the possibility that there may be applicants who would qualify for the incentive, but would take service from PG&E without the incentive, or should not be offered the incentive or extended compliance period for other reasons.
117. The ERRA proceeding has a significant number of issues and a limited time frame.
118. An annual reasonableness review would entail a separate review of the incentive for each development and the dollar value of the incentives would likely be far less than the value to ratepayers of the issues addressed in the ERRA proceeding.
119. Since inclusion of the reasonableness review in the ERRA proceeding would either reduce the parties' ability to address the issues already in the ERRA proceeding, or result in the parties paying little attention to the reasonableness review, the reasonableness review should not be conducted in the ERRA proceeding.
120. Since there is no other available proceeding to include the reasonableness review in, the reasonableness review would have to be conducted in a separate proceeding.
121. A reasonableness review proceeding would likely be controversial and complex even though it would address relatively small amounts of money.
122. A reasonableness review proceeding could be costly to the Commission, PG&E and the other parties and a drain on their resources.
123. The record does not demonstrate that initiation of reasonableness review proceedings would be the best use of the parties' or the Commission's resources.
124. The facts that the reasonableness review would have to be a separate proceeding, would be a drain on parties resources and may not be the best use of the parties' resources tend to support denial of the application.
125. If the incentive should have been offered, but in a lower amount and the development does not provide a negative contribution to margin, the ratepayers would be no worse off if PG&E pays the cost of the excess incentive.
126. PG&E has not proposed a way to make ratepayers whole when the incentive should not have been offered and PG&E ends up serving new customers who provide a negative CTM and who otherwise would likely have taken service from the POU rather than PG&E.
127. Under PG&E's proposal, if the incentive should not have been offered and the development has not been connected to PG&E by the end of the compliance period, the applicant would be entitled to reconsider whether it wants to connect with PG&E under PG&E's standard tariffs or with the POU.
128. Under PG&E's proposal, since the reasonableness review would take place in the year following contract signing, but the compliance period could be as long as five years after signing, the applicant could be bound by the contract for as many as four years after it has been found unreasonable.
129. PG&E has not justified its proposal that if the incentive should not have been offered and the development has not been connected to PG&E by the end of the compliance period, the applicant would be entitled to reconsider whether it wants to connect with PG&E under PG&E's standard tariffs or with the POU.
130. If PG&E's error in offering an excessive incentive, or offering one when none should have been offered, was intentional or part of a pattern indicating negligence, the Commission would have to consider in the reasonableness review a penalty to deter further transgressions.
131. Consideration of a penalty in a reasonableness review would make the review more complex, controversial and costly.
132. If the error in offering an excessive incentive, or offering one when none should have been offered, is due to a misrepresentation by the applicant and PG&E was not at fault, PG&E could seek cost recovery from the applicant through the courts, at shareholder expense, if it chooses to do so.
133. PG&E has not demonstrated that its proposal regarding the consequences of a finding of unreasonableness appropriately addresses the range of possible outcomes and the record is insufficient to remedy the shortcomings of PG&E's proposal.
134. Since the developer in the case of backbone-only services would not be adding new services, it is unclear how PG&E could determine whether the developer would be able to meet its commitment or how the reasonableness of the incentive could be evaluated.
135. PG&E's proposal for backbone-only services is unclear regarding whether the applicant's commitment means that the new load would have to be sufficient to pay for the incentives within the first five years or that sufficient new load would be connected within the first five years to provide a positive CTM over a 30-year period.
136. PG&E has not explained how its proposed backbone-only incentive would work in sufficient detail for us to evaluate.
137. Section 783(b) addresses Commission consideration of a decision amending rules governing the extension of services provided by an electric or gas corporation to new customers.
138. Section 783(b) requires the Commission to make written findings on seven issues that address the effect of the rule change on various types of customers, employment, residential and non-residential development and redevelopment, and energy consumption and conservation.
139. Section 783(c) requires the Commission to seek the assistance of various other state agencies, to make the written findings.
140. Section 783(d) provides that a decision amending rules governing the extension of services provided by an electric or gas corporation to new customers shall take effect on July 1 of the year following its adoption.
141. PG&E's Electric Rule 15.I.3 states: "When the application of this rule appears impractical or unjust to either party, or ratepayers, PG&E or Applicant may refer the matter to the Commission for a special ruling or for approval of special condition(s) which may be mutually agreed upon."
142. PG&E's Electric Rule 16.G has the same language as Rule 15.I.3 except for a difference in punctuation that has no effect on its meaning.
143. The Rule 15.I.3 language refers to a single "Applicant."
144. Rule 15.J and Rule 16.H define "Applicant" as: "APPLICANT: A person or agency requesting PG&E to supply electric service."
145. The term "Applicant," as used in Rules 15 and 16, is singular.
146. Each such contract involving an exceptional case would be viewed separately.
147. PG&E's proposal would involve an unspecified number of future contracts each of which is likely to have a different incentive and may have a different compliance period.
1. Because PG&E's proposal would not be good public policy and would not be practical to implement, the application should be denied.
2. Since a significant positive effect on CTM is necessary to have a significant positive effect on rates, we have no reason to believe the incentives would have a significant positive effect on rates.
3. We do not interpret D.92-11-052 to define uneconomic bypass as necessarily including service of new customers by a POU rather than PG&E.
4. The reasonableness of using the marginal costs adopted in the 2007 GRC settlement in calculating CTM is not proven.
5. PG&E's CTM calculation has not been shown to be reasonable.
6. If the ratepayers are to fund the proposed incentives, they should have a reasonable assurance that there will be a positive CTM.
7. It is reasonable to set a threshold CTM at or above the margin of error so that ratepayers will have a reasonable assurance that there will be a positive CTM.
8. PG&E's proposal that the applicant should not be required to obtain a written offer from the POU and include a copy of it with the affidavit is unreasonable.
9. Holding workshops after this application is approved to flesh out the criteria PG&E would use in exercising its requested discretion is unreasonable because we can not determine whether its proposal could lead to unreasonable discrimination and, unless such a workshop results in agreement by all the parties which we believe unlikely, further hearings would be necessary before the proposal could be implemented.
10. PG&E has not justified its request for discretion.
11. If PG&E paid an excessive incentive, PG&E's shareholders should pay for the excess as recommended by PG&E.
12. If the incentive should not have been offered at all, PG&E's shareholders should pay for it as recommended by PG&E.
13. PG&E's proposal that, if the incentive should not have been offered and the development has not been connected to PG&E by the end of the compliance period, the applicant would be entitled to reconsider whether it wants to connect with PG&E under PG&E's standard tariffs or with the POU, is unreasonable.
14. If PG&E's error in offering an excessive incentive, or offering one when none should have been offered, was intentional or part of a pattern indicating negligence, the Commission should consider in the reasonableness review a penalty to deter further transgressions.
15. If the error in offering an excessive incentive, or offering one when none should have been offered, is due to a misrepresentation by the applicant and PG&E was not at fault, there is no reason ratepayers should indemnify shareholders for such costs and PG&E shareholders should still be responsible for any resulting costs as if PG&E were at fault.
16. PG&E's proposal regarding findings of unreasonableness is not practical to implement.
17. PG&E has not demonstrated that provision of incentives for backbone-only services is reasonable.
18. The exceptional case provisions of Rules 15 and 16 apply to a single contract between PG&E and a single person or agency.
19. PG&E's proposal does not fall within the exceptional case provisions of Rules 15 and 16.
20. If we were to grant PG&E's application, it would require a change to PG&E's rules, triggering § 783.
21. This decision should be effective immediately.
IT IS ORDERED that:
1. Application 06-07-027 is denied.
2. Application 06-07-027 is closed.
3. This order is effective today.
Dated December 6, 2007, at San Francisco, California.
MICHAEL R. PEEVEY
President
DIAN M. GRUENEICH
JOHN A. BOHN
RACHELLE B. CHONG
TIMOTHY ALAN SIMON
Commissioners
ATTACHMENT A
LIST OF ACRONYMS
Acronym |
Name |
A&G |
administrative and general |
CARE |
California Alternative Rates for Energy |
CCSF |
City and County of San Francisco |
COO charge |
cost of ownership charge |
COS factor |
cost of service factor |
CTM |
contribution to margin |
D. |
Decision |
DRA |
Division of Ratepayer Advocates |
ERRA |
Energy Resource Recovery Account |
FF&U |
franchise fees and uncollectibles |
GRC |
general rate case |
ITCC |
Income Tax Component of Contributions |
kWh |
kilowatt-hours |
MID |
Collectively the Modesto Irrigation District and the Merced Irrigation District |
NCPA |
Northern California Power Agency |
NPV |
net present value |
O&M |
operations and maintenance |
PG&E |
Pacific Gas and Electric Company |
POUs |
publicly-owned energy utilities |
PPP |
public purpose program |
RAP |
Revenue Adjustment Proceeding |
RIM test |
Ratepayer Impact Measure test |
Rule(s) |
PG&E tariff rules |
§ 783 |
Public Utilities Code Section 783 |
TRC test |
Total Resource Cost test |
TURN |
The Utility Reform Network |
(END OF ATTACHMENT A)
20 Electric Rule 16.G has the same language except for a difference in punctuation that has no effect on the meaning.
