VI. Implementation

PG&E shall file an advice letter to change its electric rate components effective January 1, 2003 to incorporate changes in its electric revenue requirement related to this proceeding. PG&E shall reflect the gas revenue requirement authorized by this decision in its January 2003 gas rates, in conjunction with the implementation of its annual true-up of Balancing Accounts rate changes. PG&E shall update its ROE upon implementing the financing contemplated by the reorganization plan approved by the Bankruptcy Court.

SCE's Performance Based Ratemaking Mechanism continues to govern its ROE, except for its ROE applicable to utility retained generation assets (URG) until a final decision is issued in its Application (A.) 02-05-004 GRC. Hence, SCE's ROE and return on rate base being authorized by this decision applicable to non-URG operations shall become effective and implemented on the same date as the final decision in its general rate case proceeding.³³ The test year revenue requirement applicable to such operations shall be prorated as of the effective date of the cost of capital decision. The revenue requirement for SCE's URG operations shall become effective January 1, 2002 and shall be recorded in its "ISO Balancing Account" subject to refund or true up in its pending GRC.

Sierra and SDG&E shall implement the revenue requirement change being authorized by this order through advice letter filings to become effective January 1, 2003.