Other Issues

Edison's Funding Proposal

SB 1194/AB 995 mandates a $90 million funding level for Edison in 2002 and beyond. The ACR Implementing AB 970 directed Edison to submit PY 2001 program plans and budgets totaling $90 million instead of the $50 million PGC minimum funding level set forth in §381(c)(1).

In its application, Edison submits a $90 million budget for PY 2001. The $90 million budget designates funding of $50 million in PGC funds and another $40 million from interest in the energy efficiency balancing account and carry-over funds available after satisfying its PY 2000 Summer Initiative obligations. Edison also proposes to use PY 2002 funds for certain projects if the proposed funding sources fall short. REECH objects to Edison's proposal.

Edison argues that requiring it to submit a 2001 budget that includes more than $50 million in PGC funds would contravene the "clear legislative intent" of §381(a) which requires the CPUC to authorize the utilities to "identify a separate rate component to collect the revenues used to fund these programs" because under current market conditions, Edison has no assurance of cost recovery for any amount about the legislatively established minimum.

While we do not adopt Edison's interpretation of §381, we agree that, under current market conditions and Edison's rate freeze, it would be burdensome to order it to adjust its ratemaking to absorb an additional $40 million in PGC funding over which it has no assurance of cost recovery. We therefore approve Edison's PY 2001 program funding proposal¹⁴ as proposed, with one exception. We do not authorize Edison to use PY 2002 funds to satisfy commitments entered into in 2001 but that do not come due for payment until after 2001. Edison's argument that use of 2002 funds amounts to a simple accounting procedure is strained. As Edison admits, such a finding requires the Commission to "recognize that it presently intends to authorize the 2002 funding necessary to cover such commitments." (Edison Comments, p. 8.)