STATE OF CALIFORNIA GRAY DAVIS, Governor

PUBLIC UTILITIES COMMISSION

505 VAN NESS AVENUE

SAN FRANCISCO, CA 94102-3298

August 10, 2000 File No.: I.00-08-002 et al.

TO: PARTIES OF RECORD IN I.00-08-002, A.99-01-016, A.99-01-019, A.99-01-034
AND A.99-02-029

Enclosed is Item 1a, the Alternate Draft Decision of Commissioner Duque to the Draft Decision of Assigned Commissioner Wood mailed to you yesterday. This item is on the Commission's agenda for August 21, 2000.

In placing Agenda Item 1 on the August 21 agenda, Commissioner Wood determined pursuant to Rule 77(f)(9) that public necessity requires a reduced period for public review and comment. Accordingly, he required that comments be filed and served by 4:00 p.m.¹ on August 16 (Assigned Commissioner's Ruling Regarding Impact of High Energy Costs on San Diego Gas & Electric Company Ratepayers, page 3). In order to allow the Commission to consider Item 1a on August 21, the same reduced public review and comment period must apply.

Therefore, comments on Alternate Draft Decision 1a shall be filed and served on August 16. An original and four copies of the comments with a certificate of service shall be filed with the Commission's Docket Office, by 5:00 p.m. and copies served both by hard copy and electronic mail on all parties of record; Commissioner Duque (HMD@cpuc.ca.gov); Tim Sullivan (TJS@cpuc.ca.gov); and Administrative Law Judge Wetzell (msw@cpuc.ca.gov). Service must be accomplished by 4:00 p.m.

Yours truly,

/s/ LYNN T. CAREW    

Administrative Law Judge

LTC:sid

COM/HMD/tcg DRAFT ALTERNATE Item 1a

8/21/2000

Decision ALTERNATE DRAFT DECISION OF COMMISSIONER DUQUE
(Mailed 8/10/2000)

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Order Instituting Investigation into the Functioning of the Wholesale Electric Market and Associated Impact on Retail Rates.

Investigation 00-08-002 (Filed August 3, 2000)

OPINION MODIFYING DECISION (D.) 99-05-051, D.00-06-034,

AND D.00-08-021 TO ADOPT A RATE STABILIZATION PLAN FOR

SAN DIEGO GAS & ELECTRIC COMPANY

Summary

On August 3, 2000, we issued Decision (D.) 00-08-021. After reconsidering the exigencies of the soaring electric rates in San Diego, we adopt a rate stabilization plan and book any revenue shortfalls to the Transition Cost Balancing Account (TCBA) for future collection of these costs. The rate stabilization plan will ensure that the approximately 70 percent of all residential customers who consume 500 kWh or less will pay no more than $68 per month for electricity. The plan will also ensure that the approximately 70% of all commercial customers who consume 1,500 kWh or less will pay no more than $220 per month. The program preserves incentives to conserve electricity by requiring all customers who consume energy in excess of these amounts to pay the market rate for this additional consumption. Thus, the rate stabilization plan proposed here protects San Diego Gas & Electric Company's (SDG&E) customers from the gyrations of the current market, avoids a rate freeze, and encourages energy conservation. Finally, the rate stabilization plan requires SDG&E to file an advice letter that will implement a Levelized Payment Plan (LPP) for all customers on an "opt out" basis.

In doing so, we recognize the directive of Governor Davis to stabilize bills and the urgency of the situation in San Diego. We therefore modify D.00-08-021, D.00-06-034, and D.99-05-051 and establish a rate stabilization plan for SDG&E. We will explore other options, as appropriate.