Discussion

On May 23, 2002, Governor Davis issued Executive Order D-56-02, ordering DWR to implement a limited-term, rate-reward program (the 2002 20/20 Program) for conservation efforts by residential customers of the utilities, similar to the 20/20 program offered in 2001. On June 6, 2002, the Commission issued Resolution E-3770 ordering SDG&E to implement the 2002 20/20 Program. SDG&E states that Amendment No. 1 is intended both to implement the 2002 20/20 Program and to provide a separate line item on the Consolidated Utility Bill for bond charges. SDG&E further states that these changes are consistent with prior Commission decisions and are needed as a result of Resolution E-3770 and D.02-02-051 (which approved the Rate Agreement providing for separate Bond Charges).

SDG&E proposes that D.01-09-013 be modified to adopt Amendment No. 1 to the First Amended and Restated Servicing Agreement and be modified with the following textual changes to D.01-09-013:

(1) Add new Finding of Fact 28 to read as follows:

"SDG&E and DWR have negotiated Amendment No. 1 to the First Amended and Restated Servicing Agreement consistent with Resolution E-3770 and D.02-02-051."

(2) Add new Conclusion of Law 14 to read as follows:

"SDG&E and DWR's Amendment No. 1 to the First Amended and Restated Servicing Agreement is reasonable and in the public interest. Accordingly it should be adopted."

(3) Revise Ordering Paragraph 1 to read as follows:

"The Amendment No. 1 to the First Amended and Restated Servicing Agreement that was executed by and between the California Department of Water Resources and San Diego Gas & Electric Company, on June 21, 2002, attached as Appendix A of this decision, is approved."

We will approve Amendment No. 1 to the First Amended and Restated Servicing Agreement in order to facilitate implementation of the 2002 20/20 program, which is to commence on July 1, 2002, and to facilitate the expeditious issuance of bonds by DWR under AB 1X. We find that SDG&E's proposed revision to Ordering Paragraph 1 of D.01-09-013 may be confusing. We will therefore include SDG&E's proposed ordering language in a new Ordering Paragraph 10 to that decision.