Comments on Draft Decision

The draft decision of Assigned Commissioner Bilas and Coordinating Commissioner Wood in this matter was mailed to the parties in accordance with Pub. Util. Code § 311(g)(1) and Rule 77.7 of the Rules of Practice and Procedure. Comments were filed on ______ and reply comments were filed on ________.

Findings of Fact

1. Processing a GRC for a major gas or electric utility is a considerable task that expends an enormous amount of resources of the Commission, the applicant, and intervening parties.

2. The timing of GRCs for the major utilities is generally staggered to allow those involved to concentrate on one utility's application in a given year. With the issuance of D.00-02-046, both PG&E and Edison are slated to file concurrent TY 2002 GRC applications.

3. We find that PG&E's GRC should be delayed rather than SCE's, because it has been several years since SCE's last GRC.

4. The single most important effort we can make to streamline this proceeding is to allow time for PG&E, our staff, intervenors, and interested parties to work together to ensure that PG&E's models are transparent and avoid the problems encountered in previous proceedings.

5. It is premature to encourage formal settlement discussions until all parties submit testimony.

6. The 2002 test year should not change for the delayed application and final rates will become effective as of January 1, 2002, although the final decision will be issued later in 2002.

7. In order to expedite this proceeding, we will: (1) defer consideration of the gas resource plan to PG&E's next BCAP, (2) address marginal cost proposals in the Phase II of the GRC, and (3) have PG&E adjust the results of the compensation study from A.97-12-020 for use in the TY 2002 GRC.

8. We intend to consider providing interim rate relief to PG&E, but will not address the merits of an attrition increase at this time.

9. We will fully consider a new efforts study, but encourage PG&E, ORA, and other interested parties to confer on issues and approaches.

10. This is not the forum to consider whether to institute a generic proceeding to address depreciation issues.

11. We will consider the results of the 1999 electric distribution capital audit in the TY 2002 GRC.

Conclusions of Law

1. It is reasonable to modify D.00-02-046 to delay the filing of PG&E's NOI by nine months because this approach (1) avoids expending staff resources on PG&E's and SCE's GRC simultaneously, (2) allows PG&E to use recorded year 2000 data and avoids problematic updates, and (3) allows time for PG&E to simplify and make transparent its RO computer model.

2. The Commission must be aware of all issues before it and must consider the whole record in assessing whether any settlement is reasonable, lawful, and in the public interest.

3. PG&E should present a showing that it is understandable and well-documented so that it can receive the proper scrutiny by intervenors, interested parties, and the Commission. PG&E should not use rebuttal testimony in order to supplement its direct showing.

4. TURN and other intervenors should submit their testimony after ORA, according to our usual RCP procedures. We intend to hold evidentiary hearings to address both direct and rebuttal testimony. Therefore, we put parties on notice, pursuant to Pub. Util. Code § 1708, that we intend to modify D.89-01-040. Parties that object should so inform us in their comments to this draft decision.

5. The decision should be effective today so that PG&E and other parties may plan accordingly.

ORDER

IT IS ORDERED that:

1. Decision (D.) 00-02-046 is modified to allow Pacific Gas and Electric Company (PG&E) to file its Notice of Intent (NOI) for the Test Year (TY) 2002 general rate case (GRC) on a schedule delayed by nine months.

2. PG&E shall tender its NOI on May 1, 2001. By May 26, 2001, the Office of Ratepayer Advocates (ORA) shall notify PG&E of any deficiencies. PG&E shall correct its NOI deficiencies in a timely manner, with the goal of filing its NOI by June 21, 2001. Per the Rate Case Plan Decision 89-01-040, PG&E would then file its application 60 days later.

3. The 2002 test year shall not change for the delayed application and final rates shall become effective on January 1, 2002, upon issuance of the final decision approving these rates.

4. Interim rate relief shall be considered based on the approach followed in D.98-12-078.

5. The Executive Director shall serve a copy of this decision on the service to D.89-01-040 and parties that object to our intent to modify D.89-01-040 shall so inform us in their comments to this draft decision.

This decision is effective today.

Dated , at San Francisco, California.