6. Commission Review of the Settlements
The primary purpose of this proceeding is to determine the base revenue requirements necessary for PG&E's electric and gas distribution and electric generation operations. As noted above, the Settlements would address our core question in this proceeding by resolving virtually all of the disputed issues in the revenue requirement phase of PG&E TY 2003 GRC. The Settling Parties maintain that the Distribution Settlement and the Generation Settlement are reasonable in light of the whole record, consistent with the law, and in the public interest. They point to the fact that the revenue requirements contemplated by the Settlements are within the range of dispute as the primary indication of the reasonableness of the Settlements. The proposed Settlements, including the addendum, set forth the Settling Parties' initial litigation positions and final agreement on the disputed issues. The Parties request that the Commission treat the Settlements as unified, interrelated agreements and adopt them unconditionally and without modification. The Settling Parties state that they are aware of no statutory provision or prior Commission decision that would be contravened by the Generation Settlement.12
Under Rule 51.1(e), we will not approve a settlement unless the settlement is "reasonable in light of the whole record, consistent with the law, and in the public interest." In evaluating whether a settlement meets these criteria, we consider a variety of factors, including the strength of the applicant's case, the development of the record, including the extent to which discovery has been completed, whether the major issues are addressed by the settlement, and the reaction and/or support of interested parties. `
Because the Settlements presented are not all-party settlements subject to the guidance in D.92-12-019, we follow the criteria set forth in Rule 51.1(e), as explained in D.96-01-011.
"[W]e consider whether the settlement taken as a whole is in the public interest. In so doing, we consider individual elements of the settlement in order to determine whether the settlement generally balances the various interests at stake as well as to assure that each element is consistent with our policy objectives and the law." (Re Southern California Edison Company, 64 CPUC 2d 241,267, citing D.94-04-088.)
Although the Settlements are not all-party settlements, they are supported by all parties who actively contested PG&E's forecasted TY 2003 revenue requirement request.13 Only one party opposes the Settlements, and that party, DWR, takes issue with a single aspect of the Settlements. We address DWR's concern in Section 7.19, below.
In order to put the Settlements in context and determine whether they are in the public interest, we review the individual elements of the Settlements, focusing on the main points of contention. We do not base our conclusion on whether each one of the elements is, in and of itself, the optimal outcome. Instead, we consider whether the elements of the settlements, individually and taken as a whole, are consistent with the public interest. We do not attempt to summarize every nuance of the parties' individual positions, nor do we summarize minor issues.
We address issues not resolved by the Distribution Settlement or the Generation Settlement in Section 9, below.
12 The Settling Parties note that although PG&E requested that the Commission reconsider several of the findings adopted in D.00-02-046 in its showing, the Distribution Settlement takes no position on these policy issues. 13 We note that while AECA joined in the Distribution Settlement, it is unclear what issues, if any, were of concern to AECA because they did not file testimony or participate in the evidentiary hearings.
