ALJ/DUG/tcg DRAFT Agenda ID #5066

Ratesetting

Decision PROPOSED DECISION OF ALJ LONG (Mailed 11/2/2005)

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

In the Matter of the Application of SAN DIEGO GAS & ELECTRIC COMPANY (U 902-E) for Authority to Make Various Electric Rate Design Changes, Close Certain Rates, and Revise Cost Allocation Among Customer Classes Effective, January 1, 2006.

Application 05-02-019
(Filed February 18, 2005)

OPINION ADOPTING AN ALL-PARTY SETTLEMENT,
IF MODIFIED, FOR THE 2006 SAN DIEGO GAS &
ELECTRIC COMPANY ELECTRIC RATE DESIGN

(See Appendix A for List of Appearances.)

TABLE OF CONTENTS

Title Page

OPINION ADOPTING AN ALL-PARTY SETTLEMENT
IF MODIFIED FOR THE 2006 SAN DIEGO GAS &
ELECTRIC COMPANY ELECTRIC RATE DESIGN 1 1

1. Summary 1 1

2. Background 1 1

3. Procedural History 1 1

4. Scope and Issues 1 1

5. Standard of Review 1 1

6. The Burden of Proof 1 1

7. Settlement 1 1

a) Standard for Approval of a Settlement 1 1

b) Reasonable in Light of the Whole Record 1 1

c) Consistent with Law 1 1

d) In the Public Interest 1 1

e) Uncontested Settlement 1 1

8. Settlement Provisions 1 1

a) Total Rate Adjustment Component 1 1

a) Marginal Costs 1 1

b) Revenue Allocation 1 1

c) Capping of Revenue Allocation 1 1

f) Settlement Rates for Customer Classes 1 1

g) Tariff Language Changes 1 1

h) Future Study 1 1

9. Assignment of Proceeding 1 1

10. Comment on Proposed Decision 1 1

Findings of Fact 1 1

Conclusions of Law 1 1

ORDER 1 1

Appendix A - List of Appearances

1. Summary

This decision proposes to adopt the all-party settlement for the 2006 San Diego Gas & Electric Company (SDG&E) Rate Design Window Application if it is modified and clarified that only the settling parties' rate design is adopted and that no other ratemaking mechanisms are adopted or included in rates. The only modification is the exclusion of a new Total Rate Adjustment Component, which we find is not necessary in order to adopt a reasonable rate design that includes a reduction in the rate cross-subsidies of residential customers by other commercial and industrial customers, and other related allocations of costs among customer classes. The separate cost reallocation component is instead included in the distribution component. We otherwise find that the settlement rate design successfully moves rates towards cost-based rates lessening cross subsidies among rate classes.