2. Procedural Background
This proceeding has been referred to as Phase 2 of SDG&E's GRC. This proceeding addresses the rate design and cost allocation issues for SDG&E's electric revenue requirement.5 SDG&E's revenue requirement was litigated in A.06-12-009, which has been referred to as Phase 1 of SDG&E's GRC. The time period covered by the revenue requirement and the rates are for 2008 through 2010.
SDG&E's rate design and cost allocation application was filed on January 31, 2007. In addition to the rate design and cost allocation proposals, the application addresses dynamic pricing proposals in response to the Administrative Law Judge's (ALJ) July 5, 2006 ruling in A.05-03-015, and the directive in D.06-05-038 that SDG&E propose default CPP tariffs for all eligible customers 200 kilowatts (kW) and above.
A prehearing conference (PHC) was held on March 9, 2007. Following the PHC, a scoping memo and ruling (scoping memo) was issued on April 11, 2007. The scoping memo identified the issues to be addressed in this proceeding and established the procedural schedule for resolving the issues. Evidentiary hearings were scheduled for September and October 2007, and a telephonic PHC in advance of the evidentiary hearings was scheduled for September 14, 2007. Four public participation hearings (PPHs) were also scheduled. In accordance with the schedule in the scoping memo, various parties served their prepared testimony.
SDG&E made three e-mail requests before the September 14, 2007 telephonic PHC was scheduled to be held. The September 12, 2007 ALJ ruling summarized these requests and confirmed the actions that the assigned ALJ took. The first request addressed the AB1X issues, wherein the parties agreed to the following: stipulated to the admission of the direct testimony that had been served on or before August 10, 2007, except for the testimony on the Total Rate Adjustment Component (TRAC); waived rebuttal testimony and cross-examination on the AB1X issues, except for the TRAC related issues; and all of the AB1X related issues, with the exception of the TRAC related issues, are to be addressed in briefs.
SDG&E's second e-mail request addressed the progress of the settlement discussions and requested a delay in the procedural schedule by two weeks. The ALJ delayed the service of rebuttal testimony to September 24, 2007, and took the evidentiary hearings for September 24 through September 28, and October 1 through October 5, 2007, off calendar. The evidentiary hearings of October 9 through October 12, 2007 were retained, and three additional days of hearing were reserved for October 17 through October 19, 2007.
The third e-mail request of SDG&E asked that the September 14, 2007 telephonic PHC be rescheduled. The ALJ rescheduled the telephonic PHC to September 26, 2007.
On September 26, 2007, a telephonic PHC was held to discuss the status of the settlement talks and to establish the order of witnesses for the October 2007 evidentiary hearings. In addition, the telephonic PHC discussed SDG&E's motion to adopt a partial settlement, which was filed the day before the PHC. An ALJ ruling of September 28, 2007 summarized the telephonic PHC and the actions taken. The ALJ established a schedule for the parties to file comments and reply comments on the motion to adopt the partial settlement. In addition, the evidentiary hearing dates in October 2007 were taken off calendar and rescheduled for November 13 through November 16, and November 26 through November 30, 2007. Another telephonic PHC was scheduled for November 7, 2007.
On November 1, 2007, SDG&E filed its motion to adopt the all party and all issue settlement. The settlement, which is appended to that motion as Attachment 1, is dated October 17, 2007 and is labeled as SDG&E's "TY2008 General Rate Case Phase 2 Settlement." As a result of that motion, the assigned Commissioner and ALJ issued a November 5, 2007 ruling. The ruling took the November 7 telephonic PHC and the November 2007 evidentiary hearings off calendar. Pursuant to Rule 12.2 of the Commission's Rules of Practice and Procedure, the ruling allowed interested parties to file comments on the November 1, 2007 motion to adopt the settlement and to file reply comments as needed. In addition, the ruling bifurcated the AB1X rate cap roll off proposal from the other rate design and cost allocation issues in this proceeding and established a separate briefing schedule for the AB1X issues.6 Due to the filing of the motion to adopt the all party, all issue settlement, the ruling stated that the September 25, 2007 motion to adopt the partial settlement was moot and no further action on the September 25, 2007 motion was needed.
No one filed any comments to the November 1, 2007 motion to adopt the all party, all issue settlement. Since no comments were filed, no hearings on the settlement are needed. In accordance with the procedure described in the November 5, 2007 ruling, a proposed decision was then prepared for the Commission's action.
Four PPHs were held in the San Diego area on September 5, 2007 and September 6, 2007. Several school districts raised concerns about SDG&E's noncoincident demand charge in SDG&E's non-residential electric rates. The school districts contend that the high demand charge acts as a disincentive to install solar energy systems (SES), and that the schools are billed for demand charges during the summer months when school is out of session.
Many of the speakers at the PPHs, who represented chambers of commerce or other business interests, spoke in favor of SDG&E's AB1X roll off proposal on the grounds that it would end the rate subsidies to certain residential customers and make them pay their share of the costs.
In addition to the PPHs, we received a number of letters from SDG&E's customers who oppose SDG&E's application. Many of the letters oppose the increase in rates, and point out that those on fixed incomes and who are already conserving energy will be hurt the most. Some of the letters also complain that residential rates will go up under SDG&E's proposals, while the rates of commercial and industrial (C&I) customers decrease.
SDG&E requests that the changes proposed in this proceeding be implemented on January 1, 2008, consistent with SDG&E's GRC implementation proposal in A.06-12-009.
5 The cost allocation is also referred to as "revenue allocation" in SDG&E's application and in this decision.
6 The November 5, 2007 ruling also allowed interested parties the opportunity to object to the admission into evidence of the prepared testimony that had been served. No objections were filed. In a January 3, 2008 ruling, the prepared testimony was admitted into evidence in this proceeding.
