III. CONCLUSION

For the reasons set forth above, the Commission's Division of Ratepayer Advocates has failed to demonstrate grounds for rehearing of
D.07-08-030 as modified herein.

THEREFORE, IT IS ORDERED that:

1. D.07-08-030, as modified by D.07-11-014, is modified as follows:

a. On page 35, in first full paragraph of the section entitled Commission's Preference for a Conservation Loss Adjustment Mechanism for Los Angeles District, the third sentence is modified to delete the words: "... and will not require continuous litigation of an ROE adjustment."

b. In first full paragraph on page 37, continuing in the section entitled Commission's Preference for a Conservation Loss Adjustment Mechanism for Los Angeles District, the second sentence is deleted in its entirety.

c. The first full paragraph on page 61 in the section entitled Comments on the Proposed Alternate Decision is modified to delete the third sentence: "However, if a CLAM can be negotiated, the rate design in Phase 2 is likely to proceed smoothly" and the words "That said," in the fourth sentence are also deleted so that the forth sentence becomes the third sentence and begins with the word "It."

2. The application for rehearing of D.07-08-030 filed by the Commission's Division of Ratepayer Advocates is denied.

This order is effective today.

Dated December 20, 2007, at San Francisco, California.

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