Category of Proceeding and Need for Hearings
Under Pub. Util. Code § 1701.1 et seq. and Article 2.5 of the Commission's Rules of Practice and Procedure (Rules), the procedures applicable to a particular proceeding depend on how the proceeding is categorized.
Section 1701.1(c) (2) defines adjudicatory proceedings as "enforcement cases and complaints except those challenging the reasonableness of any rate or charges as specified in Section 1702."
Rule 5(b), implementing Section 1701.1, further defines adjudicatory proceedings as: (1) enforcement investigations into possible violations of any provision of statutory law or order or rule of the Commission; and (2) complaints against regulated entities, including those complaints that challenge the reasonableness of rates or charges, past, present, or future."
Section 1701.1(c ) (3) defines ratesetting proceedings as those "in which rates are established for a specific company, including but not limited to, general rate cases, performance-based ratemaking, and other ratesetting mechanisms."
Rule 5(c) further elaborates that ratesetting proceedings are "proceedings in which the Commission sets or investigates rates for a specifically named utility (or utilities), or establishes a mechanism that in turn sets the rates for a specifically names utility (or utilities). "Ratesetting proceedings include complaints that challenge the reasonableness of rates or charges, past, present, or future. For purposes of this Article, other proceedings may be categorized as ratesetting, as described in Rule 6.1(c)."2
The primary issue before the Commission in this investigation is whether PG&E's actions violated the existing decisions, orders, or regulations of the Commission. This is essentially an adjudicatory question. TURN is not challenging any particular PG&E rate or charge, but rather seeks to determine whether PG&E's reliance on delayed and estimated bills is consistent with PG&E's tariffs and this Commission's orders.
The Commission's Office of Ratepayer Advocates, TURN, and CCSF request that the proceeding be categorized as adjudicatory. They argue that the fact-finding questions raised in ACR Paragraph 4 will form the basis for resolution of the adjudicatory issues presented in ACR Paragraphs 5 and 6 and should be considered simultaneously. CCSF further argues that the Investigation should not be mischaracterized as an investigation into general billing and collections policy.
In a March 7, 2005 motion3 and again in its PHC statement, PG&E suggested that the Commission divide the Investigation into two phases, with the fact-finding components of the Investigation addressed first in a ratesetting phase, and the adjudicatory components addressed second. PG&E states that any phase of the proceeding that includes enforcement-related evidentiary hearings will need to be classified as adjudicatory under Rule 5(b)(1). PG&E compares its phased approach to the approach taken in Order Instituting Investigation Whether Pacific Gas and Electric Company, et al., Have Violated Relevant Statutes, etc. (2001) Cal.P.U.C.2d (D.01-05-061), where we categorized the proceeding as ratesetting and clarified that the Commission would recategorize the proceeding as adjudicatory "if our investigation results in a decision that there is probable cause to believe Respondents...violated past decisions of the Commission or other law, and we opt to determine finally whether violations occurred and consider remedies."
PG&E's comparison to the approach taken in I.01-04-002 does not apply in this proceeding because the ACR clearly determined that the primary purpose of the Investigation was to review PG&E's past actions and determine whether violations occurred. In I.01-04-002, the Commission found that the proceeding involved mixed issues of fact and policy, including an inquiry into prospective changes in our decisions or other rules governing Respondents' holding company structure. Unlike I.01-04-002, this proceeding is not now looking into developing additional rules, conditions, or changes to policies, and therefore does not present the mix of policy and fact-finding issues that was present in I.01-04-002.
The issues in this proceeding concern policy enforcement, rather than policy setting or policy implementation. The appropriate category for this type of proceeding is adjudicatory.
The Assigned Commissioner originally categorized I.03-01-012 as ratesetting in the ACR issued on February 13, 2003. The February 25, 2005 ACR consolidating the TURN motion with I.03-01-012, added a new phase to I.03-01-012 and serves as the preliminary scoping memo for this Investigation. This ruling changes the preliminary finding in the February 25, 2005 ACR from ratesetting to adjudicatory for the reasons discussed above. This ruling confirms the preliminary finding that hearings are necessary. This ruling, only as to category, maybe appealed under Rule 6.4 (Rule 6.4(a).)
2 Rule 6.1(c) provides that when "a proceeding does not clearly fit into any other the categories as defined in Rules 5(b), 5(c), and 5(d), the proceeding will be conducted under the rules applicable to the ratesetting category unless and until the Commission determines that the rules applicable to one of the other categories, or some hybrid of the rules, are best suited to the proceeding.."
3 PG&E Motion, dated March 7, 2005. PG&E's Motion was originally titled an Appeal of Categorization, but was subsequently retitled "Motion for Clarification of the Assigned Commisioner's Ruling" pursuant to the direction of the Commission's Docket Office Advisor, due to the fact that PG&E's Motion did not seek to change the categorization of the proceeding.
