VI. Affiliate Issues

The PPA as presented by Edison raises three affiliate transaction issues: (1) application of the ATRs; (2) application of the holding from D.93-03-021, referenced as the KRCC settlement, or the QF Settlement; and (3) effect of the moratorium adopted in D.02-10-062. Although Edison argued that the PPA should not trigger any affiliate issues since MVL will be a direct subsidiary of Edison, not Edison International (EIX) and MVL is prohibited by the terms of the PPA from selling to third parties, the intervenors were not so convinced. TURN and ORA were adamant that the ATRs apply to Edison's proposed transaction.

All of the other intervenors expressed concerns over the potential for affiliate abuses. The structure proposed by Edison for the PPA is so unusual that the potential for affiliate abuses is difficult to estimate. However, by denying the proposed PPA, and granting a CPCN, we remove the all the affiliate issues from the table, and do not have to address: (1) whether the ATRs apply, and if so, whether a waiver should be granted; (2) whether the moratorium on affiliate transactions apply, and if so, whether a waiver should be granted; and (3) the application of the QF settlement. This comports with the general direction in which the Commission is moving on affiliate issues in the procurement proceeding, which has moved away from problematic relationships with affiliates, and towards a greater degree of electric utility re-integration.