Discussion

Our adoption of a revised payment schedule in D.01-03-067 was one means of addressing the energy crisis, and the disputes between utilities and QFs, particularly the withholding of payments from utilities to QFs. As we stated in D.01-03-067:¹² "Prompt payment by the utilities for energy delivery by the QFs given current conditions is key and critical to maintaining energy reliability." Thus, we accelerated payments for energy deliveries to a 15-day schedule. However, as PG&E notes, and as confirmed by the Governor's November 13, 2003 pronouncement, the energy crisis has passed. In addition, PG&E has now resolved its Chapter 11 bankruptcy, thus clarifying PG&E's financial status, and as Edison points out, payment schedule changes have already been resolved for many agreements between QFs and utilities.

Given these changes, we believe it is reasonable to grant PG&E's Petition and allow all California IOUs to return to the agreed upon terms of their PPAs, by removing the requirement for a 15-day payment schedule from D.01-03-067. In granting PG&E's Petition we note that the estimated savings to ratepayers of $7.5 million for PG&E's customers is not inconsequential, and that savings for other utilities and their customers will also occur. Furthermore, allowing the utilities and the QFs to return to their original payment schedule will reduce utilities' administrative burden and potential billing errors.

We are aware of the need for QFs to maintain good relationships with their gas suppliers, but we expect that allowing the utilities and QFs to return to their original payment schedules will not significantly disrupt the financial standing of the QFs. Should subsequent events have disruptive effects on the ability of QFs to provide energy to utilities, we will be willing to consider solutions.

In granting PG&E's Petition, we have considered PG&E's arguments regarding compliance with Rule 47(d), and agree that it was reasonable for PG&E to wait until the energy crisis was over and PG&E had resolved its bankruptcy before requesting its Petition. Therefore, we find that PG&E has met the requirement under Rule 47(d) to explain why the Petition could not have been presented within one year of the effective date of D.01-03-067.