Brown Ruling denies the motion of the Electric Generator Alliance (EGA) to strike testimony on embedded cost-based allocation or, in the alternative, to remove such testimony to another phase or proceeding.

Background

Southern California Gas Company (SoCalGas) filed its Application

(A.) 01-09-024 on September 21, 2001, for Authority to Revise its Rates Effective January 1, 2003, in its Biennial Cost Allocation Proceeding (BCAP), and on October 5, 2001, San Diego Gas & Electric Company (SDG&E) followed with its BCAP Application, A.01-10-005. Both initial applications proposed to replace the LRMC methodology, a methodology followed by the Commission for the last decade, and replace it with an embedded cost-based allocation methodology. Both initial applications presented theoretical testimony in support of the shift in methodologies. SoCalGas and SDG&E amended their applications on

November 13, 2001, and November 21, 2001, respectively, to present resulting rates from an embedded cost-based allocation analysis. Pursuant to an Administrative Law Judge (ALJ) Ruling, both BCAP applications were consolidated for proceeding purposes and a Prehearing Conference (PHC) was held on December 4, 2001.

On December 3, 2001, EGA filed its motion to strike the testimony on the embedded cost-based allocation or, in the alternative, to remove such testimony to another phase or proceeding. EGA filed the motion out of concern for how the embedded cost methodology will affect the processing and timing of this case.

At the December 4, 2001 PHC, responding parties were given until

January 4, 2002, to file a response to EGA's motion, and oral argument was set for January 10, 2002. The following parties filed a response to EGA's motion: The California Cogeneration Council (CCC); Office of Ratepayer Advocates (ORA); Pacific Gas and Electric Company (PG&E); SoCalGas and SDG&E; Southern California Generation Coalition (SCGC); the Utility Reform Network (TURN); Watson Cogeneration Company (Watson); and the Western Manufactured Housing Communities Association (WMA).

On December 11, 2001, the Commission issued Decision (D.) 01-12-018. This decision adopted, with various modifications, the Comprehensive Settlement Agreement submitted in the Gas Industry Restructuring (GIR) proceeding. This decision unbundled SoCalGas' backbone transmission system and storage on an embedded cost basis. Responding parties had the advantage of reading the GIR before filing their responses.

At the January 10, 2002, motion hearing oral argument was presented by the following: Brian Cragg, of Goodin, Macbride, Squeri, Ritchie & Day, LLP, for EGA; Joesph M. Karp, of White & Case, LLP, for CCC; Patrick Gileau for ORA; Brian Cherry for PG&E; Jeffrey Parrott for SoCAlGas and SDG&E; Scott A. Lehecka for SCGC; Marcel Hawiger for TURN; Thomas Beach for Watson; and Ed Poole for WMA. In addition, although not filing any written response, Gregory Klatt presented oral argument on behalf of Transwestern.