II. Overview of the Applications
SoCalGas and SDG&E filed individual applications seeking to revise their base rate revenue requirements effective January 1, 2004, and seeking authority to establish a formula to adjust the revenue requirement for 2005 through 2008. The applications did not propose joint rates or a single common revenue requirement. Pursuant to Rules 45 and 55 of the Commission's Rules of Practice and Procedure (Rules),2 a joint motion for consolidation of the separate applications was filed concurrently with SoCalGas' A.02-12-027 and SDG&E's A.02-12-028 on December 20, 2002, respectively, for authority to update their gas and electric revenue requirements and base rates. SoCalGas requested an approximate $130 million increase in natural gas distribution revenues for Test Year 2004 and SDG&E requested an approximate $58.9 million increase in electric distribution revenues3 and $21.6 million increase in natural gas distribution revenues for Test Year 2004. In addition, both companies sought authority for "Margin Per Customer" (MPC) indexing mechanisms. The two companies' requested revenue requirements included virtually all their expenses for operation, maintenance, safety, and general expenses. By Ruling, the applications were consolidated on January 22, 2003. On March 13, 2003, the Commission issued Order Instituting Investigation (I.) 03-03-016 to allow the Commission to hear proposals other than the applicants', and to enable the Commission to enter orders on matters for which the utilities may not be the proponent.
These applications were not filed in conformance with the Commission's rate case processing plan, as discussed below. They are in conformance with specific exemptions granted as a part of previously adopted incentive ratemaking mechanisms.
The requests by both companies for indexing mechanisms and all consideration of any form of incentive ratemaking is in Phase Two of these proceedings.4
2 Unless otherwise noted all subsequent references to Commission Rules are to the Commission's Rules of Practice and Procedure published as of May 2003.
3 This includes the effects of nuclear costs after the termination of the Incremental Cost Incentive Plan.
4 Ruling Clarifying the Scoping Memo and Modifying the Schedule dated May 22, 2003. We affirm the deferral in this decision.
