Proposal from Richard Hairston, WMA for discussion at May 31 meeting in San Francisco

May 21, 1996

DAWG MARKET RULES COMMITTEE

Proposed Principles Governing Direct Access in Mobilehome Parks

At its May 16, 1996 meeting the DAWG Market Rules Committee discussed Direct Access in mobilehome parks. The group seemed to reach consensus on several points or "principles" that should apply to the unique circumstances within mobilehome parks. There was also an indication that further discussion might be desired on one or two points. This report documents the principles that seemed to be agreed upon, and facilitates further discussion at the next meeting. This report also suggests one additional principle, offered here for the first time by WMA, for the group's consideration. The group's objective is to finalize its position at the May 31, meeting. Prior to May 31, anyone with questions or concerns regarding what is written here should feel free to call Rich Hairston at (916) 485-0550, or FAX to (916) 481-0866.

Background on Mobilehome Park Electricity Distribution

There are two modes of distributing electricity in California mobilehome parks. During the process of constructing a park, park owners have the exclusive right to choose either:

• to allow the local utility to extend its distribution system to each space within the park (consistent with line extension rules applied to the owner), thereby making each resident a direct customer of the utility, or
• to install, own, operate, and maintain their own distribution system.

Historically, most owners have chosen to install their own systems. These are typically installed underground and consist of transformers, wires, and necessary hardware installed throughout a park, along with meters at each mobilehome space. Each system is connected at one metered point to a local utility from which the park owner purchases electricity for resale to park residents. The Western Mobilehome Parkowners Association (WMA) estimates that today there are approximately 3,500 park-owned distribution systems (in some cases a single park contains more than one system) purchasing electricity from PG&E, SCE, and SDG&E for resale to roughly 300,000 residents.

Regarding direct service, WMA estimates that there are nearly 1,000 mobilehome parks that PG&E, SCE, and SDG&E serve directly, where each resident is an individual utility customer. The owners of directly-served parks buy the electricity that is used in the common areas, like laundry rooms, swimming pools, and clubhouses, but are not involved in supplying electricity to residents.

Proposed Mobilehome Park Direct Access Principles

1. Mobilehome park owners who own the distribution systems inside of their parks should be assured full recovery of any distribution-related costs resulting from Direct Access and restructuring, including any stranded distribution costs.
2. Direct Access should be made available to residents of parks served through park-owned distribution systems, provided that each resident choosing Direct Access pays for any added costs including, but not limited to, added costs incurred by the park owner for metering, data collection, billing, and administration.
3. Direct Access should be available to park-owned distribution systems, provided that residents who do not choose Direct Access, either through agreement with the park owner acting as electricity supplier or agreement with an outside supplier, continue to pay the same rates that they would pay if they were served directly by the local utility with electricity from the Power Exchange, consistent with the requirements of Section 739.5 of the Public Utilities Code.
4. The first group of UDC customers to receive the option to choose Direct Access should include a proportionate share of park-owned distribution systems and their resident customers. New principle proposed by WMA
5. Direct Access should be made available to residents of parks served directly by PG&E, SCE, and SDG&E according to the rules applicable to each utilities' other residential customers. These transactions should not affect the owners of the directly-served parks.
6. Direct Access should be made available to the owners of directly-served parks for electricity used in common areas according to the rules applicable to each serving utilities' other comparable customers.