ALJ/JMH/jva Mailed 10/29/2004

Decision 04-10-020 October 28, 2004

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Order Instituting Rulemaking to Establish Policies and Cost Recovery Mechanisms for Generation Procurement and Renewable Resource Development.

Rulemaking 01-10-024 (Filed October 25, 2001)

OPINION ADDRESSING PETITIONS TO MODIFY DECISION 03-04-029

1. Summary

This decision grants a Joint Petition to Modify Decision (D.) 03-04-029 filed by Pacific Gas and Electric Company (PG&E) and San Diego Gas & Electric Company (SDG&E) and a separate request by the California Department of Water Resources (DWR) for a modification to D.03-04-029. This decision also responds to SDG&E's request that the Commission clarify or revise the SDG&E/DWR Operating Agreement with respect to SDG&E's administration of the Williams Energy Marketing and Trading Company (Williams) Contract. In D.02-09-053, we ordered PG&E, SDG&E, and Southern California Edison Company (SCE) to assume the operational, dispatch and administrative functions for certain long-term power supply contracts entered into by the DWR. Today's decision finds that the Reliability Must-Run (RMR) Contract between Williams and the California Independent System Operator (CAISO) is separate
and distinct from the DWR contracts allocated to the utilities in D.02-09-053.


Deliveries under the Williams RMR Contract are therefore not subject to the Operating Agreement and any remittances by SDG&E for RMR deliveries are not subject to the terms in the Operating Agreement.