TABLE OF CONTENTS

ORDER ADOPTING COST RESPONSIBILITY 33

SURCHARGE MECHANISMS FOR 33

CUSTOMER GENERATION DEPARTING LOAD 33

I. Introduction 33

II. Procedural Summary 77

III. Proposed Settlement 1010

A. Summary of the Proposed Settlement 1010

B. Standard for Considering Settlements 1212

C. Comments to the Settlement Agreement 1414

D. The Settlement Agreement and the Public Interest 1616

IV. Treatment of Clean & Ultra-Clean DG and Net Metered Customers 1717

A. Position of Parties Regarding Small Distributed Generation 1717

B. Discussion 2121

V. Legal Authority for Imposing Cost Responsibility Surcharges 2323

VI. Prevention of Cost Shifting 2626

VII. Overview of Parties' Positions 2828

VIII. Review of Charges to be Imposed on Departing Load Customers 3030

A. Recovery of DWR Bond Charges 3030

1. Background 3030

2. Parties' Positions Prior to the Settlement 3333

3. Discussion 3434

B. DWR Ongoing Power Costs 4040

1. Positions of Parties Prior to the Settlement 4040

C. Tail CTCs 4141

1. Background 4141

2. Parties' Positions - Pre-Settlement 4343

3. Discussion 4545

D. SCE'S Historical Procurement Charge 4848

1. Parties' Positions - Pre-Settlement 4848

2. Discussion 4949

IX. Tariff Filing Implementation 5050

X. Rehearing and Judicial Review 5050

XI. Comments on the Alternate Decision of Commissioner Lynch 5050

XII. Assignment of Proceeding 5151

Findings of Fact 5151

Conclusions of Law 5353

O R D E R 5656

ORDER ADOPTING COST RESPONSIBILITY

SURCHARGE MECHANISMS FOR

CUSTOMER GENERATION DEPARTING LOAD