Conclusions of Law
1. PG&E should be authorized to recover a 2006 forecast revenue requirement for the ERRA and the ongoing CTC in the amount of $2.483 billion and $340.0 million, respectively.
2. Decisions Nos. 05-10-047, 05-10-046, and 05-01-035 determined that (i) ongoing CTC is limited to the costs specified in § 367(a); (ii) the statutory method should be used to calculate ongoing CTC; (iii) the total portfolio method should be used to determine the amount of indifference costs recovered via the CRS; and (iv) ongoing CTC is included in the CRS as a part of a blended charge.
3. PG&E's tariffs should be revised to state that only the statutory method shall be used to calculate ongoing CTC.
4. If the statutory method results in negative above-market costs, this negative amount should offset positive above-market costs included in ongoing CTC to the extent set forth in the body of today's Decision.
5. The revenue requirement identified in Conclusion of Law No. 1 should be recovered via the rate design proposed by PG&E in A.05-06-007. However, if a final decision in PG&E's 2003 GRC Phase 2 proceeding is issued before today's Decision, the rate design adopted in the GRC decision should be used to recover the revenue requirement authorized by today's Decision.
6. Today's Decision does not address whether new MDL is exempt from ongoing CTC pursuant to § 369. Parties may raise this issue in other proceedings.
7. The revenue requirement authorized by this Decision is subject to adjustment and true-up, as necessary, in the event that D.05-10-047 and/or D.05-10-046 are successfully appealed.
8. The following Order should be effective immediately so that PG&E can begin to recover on January 1, 2006, the revenue requirement authorized herein.
IT IS ORDERED that:
1. Pacific Gas and Electric Company (PG&E) is authorized to recover a 2006 forecast revenue requirement for the Energy Resource Recovery Account (ERRA) in the amount of $2.483 billion.
2. PG&E is authorized to recover a 2006 forecast revenue requirement for the ongoing Competition Transition Charge (CTC) in the amount of $340.0 million.
3. The revenue requirement authorized by this Order may be revised in accordance with the Annual Electric True-Up (AET) process to update estimates of the 2005 end-of-year balances in the (i) ERRA, and (ii) modified Transition Cost Balancing Account subaccounts for bundled and direct access customers.
4. PG&E may implement rates on January 1, 2006, in accordance with the AET process to recover the revenue requirement authorized by this Order
5. The revenue requirement authorized by this Order shall be recovered through the rate design proposed in Application (A.) 05-06-007. However, if a final decision in Phase 2 of PG&E's 2003 general rate case (GRC) in A.04-06-024 is issued before this Order, the rate design adopted in the GRC decision shall be used to recover the revenue requirement authorized by this Order.
6. Ongoing CTC shall be calculated in accordance with the statutory method described in the body of this Order. If the above-market component of ongoing CTC is negative, this negative amount may offset positive above-market costs included in ongoing CTC to the extent set forth in the body of this Order.
7. PG&E shall file revised tariffs which clearly indicate that only the statutory method shall be used to calculate ongoing CTC. PG&E shall file the revised tariffs within 10 days from the date this Order is mailed.
8. Application 05-06-007 is granted and denied to the extent set forth in the previous Ordering Paragraphs.
9. Application 05-06-007 is closed.
This Order is effective today.
Dated ________________________, at San Francisco, California.
