TRP/avs 4/22/2005
BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA
Order Instituting Rulemaking Regarding the Implementation of the Suspension of Direct Access Pursuant to Assembly Bill 1X and Decision 01-09-060.
Rulemaking 02-01-011
(Filed January 9, 2002)
ADMINISTRATIVE LAW JUDGE'S RULING
RELEASING STATUS REPORT AND
SOLICITING COMMENTSAttached to this ruling is the "Status Report," dated April 18, 2005, and prepared by the Commission's Energy Division regarding Municipal Departing Load (MDL) Cost Responsibility Surcharge (CRS) Billing and Collection Bilateral Negotiations on the First Meeting of the Direct Access (DA)/MDL CRS Calculation Working Group.
Parties may comment, as they deem warranted, on the contents of the attached Status Report as part their reply comments due on April 29, 2005, regarding the MDL CRS Billing and Collection Workshop Report.
Dated April 22, 2005, at San Francisco, California.
Thomas R. Pulsifer
Administrative Law Judge
BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA
Order Instituting Rulemaking Regarding the Implementation of the Suspension of Direct Access Pursuant to Assembly Bill 1X and Decision 01-09-060.
Rulemaking 02-01-011
(Filed January 9, 2002)
Status Report
To ALJ Pulsifer
on
MDL CRS Billing And Collection
Bilateral Negotiations
and
First Meeting of
DA/ MDL CRS Calculation
Working Group
Prepared by:
Carlos Velasquez
Steve Roscow
April 18, 2005 Energy Division
Introduction
In Rulings dated March 28th and March 30th, Administrative Law Judge Pulsifer directed the Energy Division to convene two meetings related to (1) the billing and collection of the Cost Responsibility Surcharge obligations of Municipal Departing Load and (2) related calculations of those amounts, to be prepared in coordination with the ongoing calculations of Direct Access customer cost responsibility surcharge obligations. The Energy Division scheduled and facilitated these meetings on April 12 and April 14, 2005. As directed in ALJ Pulsifer's rulings, the Energy Division provides this status
report , covering the topics listed below:March 28th, 2005 Ruling
1. "The Commission's Energy Division is authorized to proceed immediately with scheduling and coordination of negotiation sessions among the representatives of the IOUs and POUs for the purpose of developing a mutually agreeable bilateral agreement for MDL CRS billing and collection, either for transferred load only, or, if possible, also for the new load component."
2. "The Energy Division is authorized to move forward with establishing a Working Group for finalizing calculations relating to the MDL CRS obligations to date. The Energy Division shall serve as the central clearinghouse for MDL CRS data collection and modeling calculations."
March 30th, 2005 Ruling
3. "A Working Group is hereby established for producing the calculations relating to Direct Access (as well as Departing Load) cost responsibility obligations for 2003 (on a true-up basis) and for 2004 and 2005 (on a forecast basis). The Commission's Energy Division shall coordinate meetings of the Working Group, as required to seek consensus on the inputs and related calculations required for the CRS obligations at issue. The Energy Division shall serve as a central clearinghouse for the data collection and modeling calculations performed by the Working Group."
The purpose of the April 12th meeting was to form the working group that will address the second and third topics listed above; the April 14th meeting addressed the first topic above. This status report provides the results of both meetings.
Part I: Status Report on Working Group to Calculate CRS Obligations associated with Municipal Departing Load and Direct Access
Summary
The first of the two meetings convened by the Energy Division had the task of forming the working group that will calculate CRS obligations associated with municipal departing load and direct access. This group met Tuesday, April 12, 2005. As described below, the Energy Division believes that this group will be able to successfully meet its obligations, as outlined by ALJ Pulsifer:
(1) finalizing calculations relating to the MDL CRS obligations to date, and
(2) producing the CRS calculations for 2003 (on a true-up basis), and for 2004 and 2005 (on a forecast basis).
Details of discussion
First, it should be noted that due to problems with the Commission's teleconference hookup, some parties who had intended to participate remotely via the phone were precluded from participating in the workshop. The Energy Division offered to provide a summary of the meeting, and some parties accepted the offer.
Agreement on Objectives of Working Group
Following introductions and a review of the agenda, the group discussed the suggested working group objectives outlined on the agenda (the complete agenda is attached to this report). No participants disagreed with these objectives, so at least on a working level, the Energy Division considers them as guides for the group's efforts from this point forward:
· determine what is owed, who owes it to whom, and how it will be collected
· finalizing calculations relating to the MDL CRS obligations to date
· produce the CRS calculations for 2003 (on a true-up basis), and for 2004 and 2005 (on a forecast basis)
DWR Presentation
Following the group's agreement on its objectives, DWR's representative presented an overview of their experience in preparing the DA CRS calculations that have been used in Commission proceedings up to this point. (see separate PowerPoint attachment)
At the outset of this discussion, the Energy Division emphasized that--consistent with the group's agreed-upon objectives--the group itself will take over responsibility for these calculations. Within that context, DWR's representative described the development of the DA CRS model over time. That model began as a "public" model that relied on publicly available or verifiable energy modeling assumptions for certain inputs. However, once the IOUs resumed procurement of their net short, the model became a "confidential" model because the IOUs were no longer willing to share information about their own energy purchases with other parties in the proceeding. This created obvious difficulties for the DA CRS parties, who could no longer verify the basic calculation of their DA CRS obligations. Now, the challenge for this working group will be to create a non-confidential model that does allow this verification, so that the DA CRS parties can support the outcome.
At the conclusion of DWR's presentation, the group agreed to consider using a similar model that DWR has developed for use in the Commission's "Community Choice Aggregation" (CCA) Proceeding, R.03-10-003. This model is public, and has been provided to the service list in R.03-10-003. DWR has also provided a preliminary version of this model, with DA CRS calculations, to the Energy Division but not to parties in R.02-01-011. Thus, the next steps for this working group will be to undertake a review of this model, on the following schedule:
1. DWR agreed to circulate the existing CCA model, as well as supporting testimony in that proceeding that explains the modeling process. On Wednesday, April 13, DWR sent that material to the R.02-01-011 service list and the list of attendees at the January 31st MDL CRS Billing and Collections workshop.
2. DWR will update its version of this model that shows its preliminary DA CRS calculations and provide it to the Energy Division, for circulation to participants by Friday, April 22.
3. DWR will send data requests to IOUs, copied to the service list, identifying the outstanding data needed to update the DA CRS calculations and add MDL calculations to the model.
4. DWR will provide, and Energy Division will circulate, a first draft of this "public" DA/MDL CRS model with updated inputs during the week of May 9th.
5. Parties will review the material from DWR, and the model will be discussed at the next meeting of this working group, on May 19th, 2005.
Conclusion
The Energy Division believes that the process agreed upon by the working group will succeed in providing a forum for completion of the calculations needed by the Commission and parties to R.02-01-011 to achieve the objectives of (1) finalizing calculations relating to the MDL CRS obligations to date and (2) producing the CRS calculations for 2003 (on a true-up basis), and for 2004 and 2005 (on a forecast basis).
At the conclusion of the next meeting of this group (May 19th, 2005), the Energy Division should be able to say with certainty when these calculations will be completed and provided to the Commission. As noted elsewhere in this status report, final estimates of MDL CRS obligations will, in turn, provide the "quantitative" information that parties have said is needed in order for the discussions of billing and collection arrangements to be finalized as well.
Part II: Status Report on Negotiation Sessions Among The Representatives Of The IOUs and POUs For The Purpose Of Developing A Mutually Agreeable Bilateral Agreement For MDL CRS Billing And Collection, Either For Transferred Load Only, Or, If Possible, Also For The New Load Component
Introduction
The process for billing and collecting the relevant cost responsibility surcharge (CRS) components from applicable Municipal Departing Load (MDL) customers was initiated in a December 23, 2004 ALJ Ruling issued pursuant to D.03-07-028, as modified by D.03-08-076, D. 04-11-014, and D.04-12-059.
The December 23rd Ruling stated that "measures must be devised whereby the IOUs can access the data necessary to bill and collect CRS from the applicable customers of POUs," and ordered that a technical workshop be held on January 31, 2005 for the purposes of seeking consensus among IOUs and POUs on a process and procedures to bill and collect the MDL CRS from the departing load customers with applicable transferred load and new load.
At the January 31st workshop, parties agreed that negotiations between the IOUs and the POUs concerning a mutually agreeable way to collect non-bypassable charges (NBCs) should be attempted. They also agreed that given that the IOUs already had information concerning POU transferred load customers, the billing and collection issues related to this set of customers could likely be resolved cooperatively, through bilateral negotiations. Parties were less optimistic about reaching a quick resolution on the new load billing and collection matters, but did agree to also attempt to seek a possible billing and collection resolution through similar bilateral negotiations.
As a result of the discussions held at the workshop, which were summarized in a March 11, 2005 Energy Division workshop report, a March 28th ALJ Ruling ordered that the Energy Division facilitate negotiation discussions in a working group setting in order to develop mutually acceptable bilateral billing and collection agreements between individual IOUs and POUs and to report the progress made by the working group in a status report by April 18, 2005.
The following two sections provide a summary of the discussions that took place at the April 14, 2005 working group meeting and some concluding remarks of the Commission's Energy Division staff, based on observations that the Energy Division made as the facilitator of the meeting.
