Other Cost Recovery

Edison has already spent money on preliminary retrofit work, on the C-Aquifer hydro-geological and environmental study and on an initial Preliminary Environmental Assessment (PEA). This decision authorizes additional spending on those activities as well as spending for the alternatives feasibility study. If Mohave operations are ultimately extended, Edison will capitalize its 56% share of these costs along with all other capital improvements made to the facility consistent with accounting conventions. If however, the plant is permanently closed, Edison will request abandoned plant recovery of its 56% share of these expenses in a GRC. We also adopt the Unions' proposal that if Mohave shuts down prematurely, Edison will not recover any unamortized Mohave plant balances unless it can demonstrate that it took all such steps to preserve the "Mohave-open" alternative and that the shut-down is due to factors outside of the utility's control.

While we cannot determine at this time whether Mohave will prove to be cost effective because of the confluence of multiple factors surrounding the Mohave facility--all of which are out of the control of this Commission, we do want to give the parties some assurance. Therefore, all reasonable costs Edison has incurred, or will incur for the water hydro-geological and environmental studies and the preparation of the PEA are recoverable as capital expenditures--subject to audit in a General Rate Case. We find those costs already incurred and reviewed in this proceeding so far to be reasonable.

In addition, as Edison proceeds with the other authorized spending, we will give Edison advance regulatory review and guidance as to the reasonability of the spending if Edison files a request for such review with the ED and serves it on the sub-service list for A.02-05-046 as part of the service list for R.04-04-003.