Full Group: 9/4
Summary of AB 1890: Don Fellows of Southern California Edison presented a summary AB 1890, recently passed by the legislature concerning electric industry restructuring. Among other provisions, it imposes a rate freeze during its transition period, although it leaves discretion to the Ratesetting Working Group in some areas.
Baseline Rate Issues/ Coordination with Low Income Working Group: Jeff Nahigian and Bob Finkelstein discussed TURN's position paper, and distinguished between interim vs. long-term rate changes: AB 1890 (as well as D.95-12-063) appears to preclude changes in baseline rates during the transition period and thus to be consistent with TURN's position, but there was no consensus on long term structure. AB 1890 appears to allow only downward latitude in adjusting rate components such as baseline rates. The discussion also distinguished between the effects of baseline rates and low income (CARE) rates. The utilities plan to propose no change in baseline rates in their 11/15/96 filings. Bob Finkelstein will function as an informal liaison between the two working groups, since he also attends the Low Income WG. If anyone needs to discuss continuing issues concerning baseline rates, they should contact Jim Price (j.price@cpuc.ca.gov or 415-703-1797) prior to the next meeting (9/18/96) to request time on its agenda.
Identification and Discussion of Line Extension Issues: Jeff Nahigian discussed TURN's position paper. Discussion clarified that the revenue applicable in the future to line extensions would be that corresponding to the UDC's distribution function (e.g., monopoly functions), not the UDC's function in collecting CTC or public benefit charges; no opposition to TURN's proposal was expressed. TURN recommends that line extension issues should be debated primarily in the Commission's line extension OII; similarly, a point made during discussion was that D.96-06-061 may make line extension issues moot for purposes of this working group.
Comparison of Utilities' 7/15/96 Preliminary Unbundling Filings: Bob Hansen of SDG&E presented a comparison among the three utilities' filings; a comparison table is available on the Web site from the last meeting. General consistency was noted in treatment of CTC rates, although SDG&E proposes a uniform percentage for CTC rather than setting CTC rates by rate component as proposed by PG&E and Edison. Another difference is SDG&E's use of forecasted Power Exchange prices vs. PG&E's and Edison's use of recorded prices, in determining charges for CTC. Mapping between unbundled utility functions and tariff rate components will be examined in detail at the next Analysis subteam meeting (9/17/96).
Multi-Part Tariffs: Ken Goeke (Energy Commission) presented a recommendation to consider multipart tariffs; this presentation will be posted on the Web site. The goals of this proposal are to increase economic efficiency and make existing subsidies more transparent. Discussion included recognition of a complex number of variables that affect cost of service, including geographic variations, and recognition of political sensitivities.
Implications and Approaches Concerning Performance-Based Ratemaking: Parties discussed differences and similarities between the utilities' PBR proposals, timing concerns, and methodological concerns. A prehearing conference will occur on Sept. 17, after which further consideration will be given to whether to form a subteam on PBR issues.
Future Meetings: The following continuation meetings were scheduled:
Sept.
17 Subteams CPUC Training Room (1st floor, at Golden Gate Ave.)
18 Full Group PG&E Energy Center
Oct.
8 Full Group PG&E Energy Center
9 Subteams CPUC, Room 4010
23 Subteams CPUC, Room 4010
24 Full Group PG&E Energy Center
Dec.
3 Subteams CPUC, Room 4010
4 Full Group PG&E Energy Center
Telecommunications Billing and Incremental Cost Methodologies: CPUC representatives were not available, so this discussion was deferred to a future meeting.
Unbundling Competitive Distribution Services: David Croyle of SDG&E presented a proposal for analysis using its proposed managerial accounting techniques; this will be illustrated over the next four weeks, by examining unbundled metering as a test case, due to tradeoffs such as complexity and existence of common costs. SDG&E's "Competitive Service Unbundling" proposal will be posted on the Web site. SDG&E will be the lead for this analysis, and will maintain contacts with the other utilities concerning analytical feasibility with their available data -- thus, Edison and PG&E will avoid commitment of significant resources that may not be necessary if SDG&E's methodologies are not adopted. Some data may already be available, since Edison performs meter reading for Long Beach Gas Dept., and SDG&E may perform meter reading for others. Initially, the analysis will use illustrative numbers, but the analysts will ensure that real numbers would be available when needed. The status of SDG&E's analysis will be reviewed at the next meeting (9/17/96).
Identification of Master-Metering Issues: Richard Hairston, representing WMA, presented an identification of tariff provisions that appear to need revision when direct access becomes available. The utilities will consider what changes may be required. Rich Hairston and Jeff Nahigian will attempt to contact other parties that may be interested, for consideration at the next meeting (9/17/96).
Various options for treatment of master-meter credits have been identified in the Direct Access Working Group report. Issues include (1) what to do if a master-meter customer wants direct access but some tenants don't, or a master-meter customer doesn't want direct access but some tenants do, (2) whether tenants should have an option to pay the UDC bundled rate, or to select direct access -- WMA is willing if details can be worked out, and (3) whether tenants choosing special metering or other special service should pay its costs. WMA sees no fundamental change needed. /**/
Functioning of Non-Firm Rates: Recent operations were reviewed, Edison's proposed operating criteria were discussed, and the future direction of discussions was considered. Following the multi-state system disturbance on August 10, Edison operated its interruptible program during system recovery on August 10. During 1996, PG&E has called load management operations (including notified curtailments) on July 1, July 29, July 30, and August 13. Underfrequency disturbances caused shedding of interruptible (i.e., underfrequency relay (UFR)) customers on July 1 and July 23, as well as shedding both UFR customers and rotating outage blocks during the multi-state disturbances on July 2 and August 10. Periods of significant heat storms/ high loads on PG&E's system have been July 1 - 3, July 28 - August 1, and August 9 - 15. On August 13 and surrounding days, PG&E was making purchases, including from Edison, as its plants were being brought back on-line. Concerning Edison's proposed operating criteria, concerns included DRA's observations that (1) PG&E's need for extra support by purchases in the August 13 period, while Edison was able to supply a portion (but not all) of PG&E's needs, suggested that only ISO-wide criteria as proposed by Edison may not be appropriate, and (2) Edison's proposed criteria may be more restrictive than those currently adopted by the Commission. Parties noted that (1) PG&E existing tariffs are closed to most new customers, Edison has a pending advice letter to close its existing tariffs, and SDG&E has no customers on traditional interruptible rates, (2) customers have options under the new protocols to take service in ways equivalent to being interruptible (i.e., demand bids and bidding as non-spinning reserve), (3) legislation (AB 3153) has passed maintaining the existing interruptible options for existing interruptible customers, so (4) the remaining issues are with how to incorporate existing interruptible customers into the new protocols, an issue that is more appropriate for discussion in WEPEX teams. This subteam will await resolution of dispatch protocols under WEPEX, and reconvene when retail tariff language is needed.
/**/ Revised 9/16/96