4. Extending the Lifeline Program to Region I;
Company-Wide Ratemaking
ORA contends that the Commission's denial of SCWC's proposal for regional rates in Region I should not bar development of a lifeline rate there. As ORA points out, eligible low-income customers live in Region I as well as in Regions II and III. SCWC responds that absent a uniform tariff schedule across Region I, the CARW - or any other lifeline rate - is untenable because the discounts provided in any one district would have to be recovered from the relatively small number of nonparticipating customers in that district. Region I has eight districts, some of them quite small (e.g. Clearlake has about 2,200 residential customers and Bay, about 4,800) and small, rural districts often have a high concentration of low-income customers. As SCWC asserts, spreading the costs of a lifeline rate program over a large customer base minimizes the direct impact on each of the individual customers charged with funding the subsidy. SCWC has made the case that establishment of a lifeline rate in Region I faces ratemaking complexities that do not exist in Regions II and III. However, SCWC has not made the case that an effective lifeline program cannot be established in Region I. We agree with ORA that this issue should be examined more thoroughly in an appropriate, future proceeding.
We note ORA's suggestion that the ratemaking solution lies in administering the lifeline rate program, for Region I as well as the other two regions, as a company-wide program, with all program costs recovered on that basis. ORA's testimony does not provide a clear explanation, let alone a roadmap, for carrying out this part of its proposal and SCWC counters with a list of ratemaking problems, some which would arise from including the CARW program in the general office rate case proceedings held on a three-year cycle, others from including it in the regional rate cases. On the record developed in this proceeding, we cannot determine whether it is feasible to transfer CARW program ratemaking from a single region concern to a company-wide one. However, neither do we believe that the parties have analyzed this issue fully.
The next Region I general rate case will provide an opportunity to review options for implementing a lifeline rate program in Region I and for transferring SCWC's lifeline rate program to a company-wide mechanism, together with all implementation details required to assess the merits of these two ideas. Therefore, we direct SCWC to review these issues again in the course of preparing its next Region I general rate case and to address them in its application. Likewise, we expect ORA to review these issues again and to address them in its report on the SCWC application.
