IT IS ORDERED that:
1. The request of Norcen Energy Resources Limited (Norcen) for findings that PG&E deceived the market into becoming captive to PG&E’s designs is denied.
2. The request of Norcen for a Commission order requiring PG&E to accept permanent release of Norcen’s contracted capacity on Pacific Gas Transmission Company and Canadian pipelines is denied.
3. The Gas Accord is amended, with the consent of the parties to the Gas Accord, to include the following commensurate discount rule: whenever PG&E offers any shipper a discount on its Line 400/401, PG&E is required to contemporaneously offer a commensurate discount to all shippers for similar services on its Line 300 and its California Gas Production Path.
4. The requests for approval of the Gas Accord contained in Application (A.) 96-08-043 and in PG&E’s August 21, 1996, motion filed in these consolidated proceedings, are granted subject to the commensurate discount rule as an amendment to the Gas Accord. The approval of the Gas Accord is based, in part, upon PG&E’s representations and commitments to forego recovery of the disallowed amounts ordered by D.94-03-050 and to forego its federal district court challenge to D.94-03-050 (in N.D. Cal. Civil No. 94-4381). PG&E must implement the commensurate discount rule when it implements the other provisions of the Gas Accord.
5. The request for approval of the Rule 1 Settlement in its entirety is granted, and under Rule 87 of our Rules of Practice and Procedure we waive the comment periods of Rule 51.4 of our Rules of Practice and Procedure.
6. In its operations under the Gas Accord, PG&E shall not favor shareholder interests at the expense of core customer interests in execution of the adopted core procurement incentive mechanism, or in situations in which Southwest is the lowest cost core supply, or in interstate gas transactions with affiliated pipelines, or in dealing with affiliates or subsidiaries in general.
7. PG&E’s shareholders shall bear all revenue shortfalls from future transmission rate discounts and there is a strong presumption that PG&E’s shareholders should bear all revenue shortfalls from future distribution rate discounts, if any.
8. PG&E’s request in A.94-06-044 to amortize in rates the amounts in its interstate transition cost surcharge (ITCS) account is granted, pursuant to the terms of the Gas Accord.
9. PG&E’s request to amortize in rates the amounts in its backbone credit account is denied, pursuant to the terms of the Gas Accord.
10. Within 30 days after the completion of one year of operating experience under the Gas Accord, PG&E shall file quarterly and annual reports on core procurement operations.
11. On or before March 1, 1999, PG&E shall file with the Energy Division with service to all parties on the Gas Accord service list in A.92-12-043 et al., a market assessment report that covers pipeline system operations from the implementation date of the Gas Accord through the end of 1998. This market assessment report must include a detailed and meaningful report of PG&E’s discounts for its transportation on Line 401, Line 400/401, Line 300 and the California Gas Production Path, and of PGT’s discounts for its transportation to California and/or to the Malin delivery point.
12. The September 24, 1996, motion of the Department of General Services of the State of California; the Department of Energy, Minerals & Natural Resources and the State Land Office of the State of New Mexico (New Mexico); and The Utility Reform Network (TURN) for approval of their Joint Recommendation is denied.
13. The requests of TURN and El Paso Natural Gas Company (El Paso) that PG&E be denied the authority to discount Line 401 rates are denied.
14. TURN’s proposal that direct connection rates include social and transition costs is denied without prejudice.
15. TURN’s request to limit Line 401 backhaul service to periods when Line 300 is full is denied without prejudice.
16. The requests of El Paso and New Mexico to eliminate PG&E’s use of minimum bids for brokered capacity are denied without prejudice.
17. The requests of El Paso and the Joint Recommendation sponsors to establish an independent pipeline operator are denied without prejudice.
18. El Paso’s request that PG&E be ordered to divest its interstate and intrastate gas transmission facilities is denied without prejudice.
19. The request of Northern California Power Agency for orders regarding municipal utility rate parity is denied without prejudice.
20. The request of Southern California Gas Company for orders regarding transportation service priority for non-utility gas storage providers is denied without prejudice.
21. Within 45 days after the effective date of this decision, PG&E shall file revised tariff sheets as necessary to implement the above ordering paragraphs, including the commensurate discount rule.
22. The revised tariff sheets shall comply with General Order 96-A and shall apply to service rendered on or after their effective date.
23. The tariff revisions shall not become effective until after the Commission approves the advice letter filings.
This order is effective today.
Dated August 1, 1997, at San Francisco, California.
P. GREGORY CONLON
President
JESSIE J. KNIGHT, JR.
HENRY M. DUQUE
JOSIAH L. NEEPER
RICHARD A. BILAS
Commissioners
TABLE OF CONTENTS
APPENDIX A - Additional Appearances, Substitute Appearances
APPENDIX B - Gas Accord Settlement Agreement
APPENDIX C - Present Value of Gas Accord Benefits
APPENDIX D - Elements of the Joint Recommendation
APPENDIX E - Rule 1 Settlement
See formal files for App. A through E.
Footnotes are bracketed and in blue