California

?BRC/nd3PROPOSED DECISIONAgenda ID #18454Decision BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIAApplication of Southern California Edison Company (U338E) for Authority to Establish Its Authorized Cost of Capital for Utility Operations for 2020 and to Partially Reset the Annual Cost of Capital Adjustment Mechanism.Application 1904014And Related Matters.Application 1904015Application 1904017Application 1904018DECISION GRANTING INTERVENOR COMPENSATION TO THE UTILITY REFORM NETWORK FOR SUBSTANTIAL CONTRIBUTION TO DECISION 1912056Intervenor: The Utility Reform NetworkFor contribution to Decision (D.) 1912056Claimed: $194,919.07Awarded: $194,845.66Assigned Commissioner: Marybel BatjerAssigned Administrative Law Judge: Brian StevensPART I: PROCEDURAL ISSUESA. Brief description of Decision: Decision?1912056 authorized the rates of return and capital structures for all four large energy utilities for 2020, and authorized continuation of the existing Cost of Capital Mechanism through the end of 2022. The Decision rejected requests by the electric utilities to increase their equity returns due to wildfire risks.Intervenor must satisfy intervenor compensation requirements set forth in Pub.?Util. Code §§ 18011812:IntervenorCPUC VerificationTimely filing of notice of intent to claim compensation (NOI) (§ 1804(a)): 1. Date of Prehearing Conference:June 17, 2019Verified 2. Other specified date for NOI:N/AN/A 3. Date NOI filed:July 16, 2019Verified 4. Was the NOI timely filed?YesShowing of eligible customer status (§ 1802(b) or eligible local government entity status(§§ 1802(d), 1802.4): 5. Based on ALJ ruling issued in proceeding number:See Comment #1Verified 6. Date of ALJ ruling:See Comment #1Verified 7. Based on another CPUC determination (specify):N/AN/A 8. Has the Intervenor demonstrated customer status or eligible government entity status?YesShowing of “significant financial hardship” (§1802(h) or §1803.1(b)): 9. Based on ALJ ruling issued in proceeding number:R.1901011Verified10. Date of ALJ ruling:July 26, 2019 (See Comment #2)Verified11. Based on another CPUC determination (specify):N/AN/A12 12. Has the Intervenor demonstrated significant financial hardship?YesTimely request for compensation (§ 1804(c)):13. Identify Final Decision:D.1912056Verified14. Date of issuance of Final Order or Decision: Dec. 20, 2019Verified15. File date of compensation request:February 13, 2020February 10, 202016. Was the request for compensation timely?YesAdditional Comments on Part I:#Intervenor’s Comment(s)CPUC Discussion1TURN did not receive an affirmative ruling on its Notice of Intent in this proceeding. As explained in the Commission’s Intervenor Compensation guide, “normally, an ALJ Ruling need not be issued unless: (a) the NOI has requested a finding of “significant financial hardship” under § 1802(g); (b) the NOI is deficient; or (c) the ALJ desires to provide guidance on specific issues of the NOI.” (page 12) Since none of these factors apply to the NOI submitted in this proceeding, there was no need for an ALJ ruling in response to TURN’s NOI.Verified2This proceeding was filed more than one year after the ALJ Ruling finding significant financial hardship was issued in I.1508019 on November 8, 2017, but before the ALJ Ruling finding significant financial hardship, issued in R.1812006 on April 30, 2019. Thus, the ALJ Ruling issued in R.1901011 applied “retroactively” to other proceedings in which no Ruling on financial hardship had been issued. (See ALJ Ruling, R.1901011, July 26, 2019, pp. 78).VerifiedPART II: SUBSTANTIAL CONTRIBUTIONDid the Intervenor substantially contribute to the final decision (see § 1802(j), § 1803(a), 1803.1(a) and D.9804059): Intervenor’s Claimed Contribution(s) to D.1912056Specific References to Intervenor’s Claimed Contribution(s)CPUC DiscussionWildfire Risk Adder – PolicyThe utilities argued that there are remaining “implementation risks” due to the Commission’s application of the new prudence standard.TURN argued that AB 1054 eliminated all risks arising from prudent utility actions, and that a higher ROE should not protect the utilities against imprudence.The Commission agreed that the risk to shareholders is only due to imprudent actions, and that shareholders should not be rewarded with an inflated ROE due to imprudent actions.Exh. EPUC/IS/TURN01, pp. IV11 to IV14.TURN Opening Brief, September 30, 2019, pp. 24, 4851.D.1912056, pp. 36.VerifiedWildfire Risk Adder for Electric UtilitiesIn their postAB 1054 testimonies, the utilities continued to argue that there were remaining implementation risks, and the three electric utilities requested ROE adders of 85 (SCE), 100 (PG&E) and 148 (SDG&E) basis points, on top of their base ROE requests.TURN submitted testimony and legal argument explaining that AB 1054 eliminated all risk arising from prudent utility actions, and that no risk adder was warranted.The Commission agreed that there is no basis for a separate wildfire risk adder.Exh. EPUC/IS/TURN01, pp. IV16 to IV17, V1 to V4 and V7 to V10.Exh. EPUC/IS/TURN02, pp. 1417.TURN Opening Brief, September 30, 2019, pp. 3945.D.1912056, pp. 2738.Findings of Fact 28, 29.VerifiedCalifornia Regulatory RiskSCE and SDG&E argued that utilities face various Californiaspecific risks due to regulatory lag and cost recovery risk.TURN provided testimony and argument demonstrating that California regulatory policies largely insulate the utilities from cost recovery risk and have been found to represent a constructive regulatory environment.The Commission concluded that there were no unique regulatory risks warranting adders above the modeling results.Exh. EPUC/IS/TURN01, pp. IV1 to IV11.TURN Opening Brief, September 30, 2019, pp. 24, 2831.D.1912056, pp. 3740.Conclusion of Law 17.VerifiedCalifornia Business RiskSCE and SDG&E argued that various procurement and clean energy policies create unique business risks in California.TURN provided analysis and examples demonstrating that most of these socalled “risks” are actually opportunities for the utilities to earn profits from capital expenditures, and that most of the policies have existed for several years and do not represent new utility risks.The Commission concluded that California has a wellestablished framework supporting these activities and that any risk is already included in modeling results.Exh. EPUC/IS/TURN01, pp. IV17 to IV24.TURN Opening Brief, September 30, 2019, pp. 24, 3134.D.1912056, pp. 2627.Conclusion of Law 17.VerifiedFinancial Modeling – Proxy GroupsTURN argued that PG&E’s and SCE’s use of nonregulated utility proxy groups was inappropriate and contrary to precedent.The Commission agreed. Exh. EPUC/IS/TURN01, pp. VI37 to VI42 and VII43 to VII45.TURN Opening Brief, September 30, 2019, p. 18.D.1912056, p. 10.Conclusions of Law 711Verified, discussion in D.1912056, pp. 1620.Financial Modeling – Flotation AdjustmentTURN argued that SDG&E and SoCalGas’ addition of flotation costs was theoretically inappropriate and did not comply with the requirements previously adopted by the Commission.The Commission agreed.Exh. EPUC/IS/TURN01, pp. X6 to X7 and X20 to X21.TURN Opening Brief, September 30, 2019, pp. 1718.D.1912056, pp. 2122.Conclusion of Law 12VerifiedPG&E ROEPG&E requested a base ROE of 11.0%, together with an additional wildfire risk adder of 1.00%, for an ROE request of 12.0%. TURN recommended a total ROE of 9.50 to 9.65% based on modeling results and consideration of national ROE data.The Commission adopted a reasonable range of 9.65 to 10.45%, and authorized an ROE of 10.25%. The adopted ROE is 60 basis higher than TURN’s recommendation, and 175 basis points lower than PG&E’s request.Exh. EPUC/IS/TURN01, pp. VI6 to VI35. TURN Opening Brief, September 30, 2019, pp. 1022, 7677.D.1912056, pp. 4142.VerifiedSCE ROESCE requested a base ROE of 10.6%, together with an additional wildfire risk adder of 0.85%, for a total ROE request of 11.45%. TURN recommended a total ROE of 9.65% based on modeling results and consideration of national ROE data.The Commission adopted a reasonable range of 9.8 to 10.6%, and authorized an ROE of 10.30%. The adopted ROE is 65 basis higher than TURN’s recommendation, and 115 basis points lower than SCE’s request.Exh. EPUC/IS/TURN01, pp. VI6 to VI35. TURN Opening Brief, September 30, 2019, pp. 1022, 7879.D.1912056, pp. 4041.VerifiedSDG&E ROESDG&E requested a base ROE of 10.9, together with an additional wildfire risk adder of 1.48%, for an ROE request of 12.38%. TURN recommended a total ROE of 9.40 to 9.65% based on modeling results and consideration of national ROE data.The Commission adopted a reasonable range of 9.65 to 10.45%, and authorized an ROE of 10.20%. The adopted ROE is 55 basis higher than TURN’s recommendation, and 218 basis points lower than SDG&E’s request.Exh. EPUC/IS/TURN01, pp. VI6 to VI35. TURN Opening Brief, September 30, 2019, pp. 1022, 7981.D.1912056, p. 42.VerifiedSoCalGas ROESoCalGas requested an ROE of 10.70%. TURN recommended a total ROE of 9.0 to 9.2% based on modeling results and consideration of national ROE data.The Commission adopted a reasonable range of 9.60 to 10.40%, and authorized an ROE of 10.05%. The adopted ROE is 105 basis higher than TURN’s recommendation, and 65 basis points lower than SoCalGas’ request.Exh. EPUC/IS/TURN01, pp. VI6 to VI35. TURN Opening Brief, September 30, 2019, pp. 1022, 8182.D.1912056, p. 43.VerifiedCapital Structures – Equity RatiosSCE requested in increase in the equity ratio from 48 to 52%, and the Sempra utilities requested an increase from 52 to 56%.TURN recommended that the equity ratio for SCE be increased to 50%, and that the equity ratios for the Sempra utilities be maintained at 52%.The Commission authorized SCE’s requested capital structureThe Commission rejected SDG&E’s and SoCalGas’ requested equity ratio increases.TURN Opening Brief, September 30, 2019, pp. 8284.D.1912056, pp. 78.D.1912056, pp. 911.VerifiedPG&E – Customer DepositsTURN recommended no change in the ratemaking treatment of customer deposits.The Commission agreed that the ratemaking treatment adopted in D.1408032 should be continued.Exh. TURN02.TURN Opening Brief, September 30, 2019, pp. 8788.D.1912056, pp. 4748.VerifiedDuplication of Effort (§ 1801.3(f) and § 1802.5):Intervenor’s AssertionCPUC Discussiona.Was the Public Advocate’s Office of the Public Utilities Commission (Cal Advocates) a party to the proceeding?YesVerifiedb.Were there other parties to the proceeding with positions similar to yours? YesVerifiedc.If so, provide name of other parties: EPUC and IS; UCAN; POC; Del Monte; FEAVerifiedd.Intervenor’s claim of nonduplication: TURN's compensation in this proceeding should not be reduced for duplication of the showings of other parties. In a proceeding involving multiple participants, it is virtually impossible for TURN to completely avoid some duplication of the work of other parties. In this case, TURN actually partnered with the Energy Users and Producers Coalition (EPUC) and the Indicated Shippers (IS) to share the costs for the consulting services of Brubaker & Associates, who prepared and submitted the testimony of Mr. Michael Gorman jointly on behalf of TURN and EPUC/IS. TURN thus shared the costs of work related to PG&E, SCE and SoCalGas, and therefore reduced TURN’s consulting costs in this case by about 40%.TURN participated in several coordination calls to discuss issues with other intervenors, including Cal Advocates, UCAN, EDF and Del Monte, so as to provide supporting analyses and minimize unnecessary duplication. TURN thus includes a certain about 13 hours for “coordination,” and we believe that this time resulted in a decrease in total time devoted to the proceeding. Any incidental duplication that may have occurred here was more than offset by TURN’s unique contribution to the proceeding. Under these circumstances, no reduction to our compensation due to duplication is warranted given the standard adopted by the Commission in D.0303031 andconsistent with the conditions set forth in Section 1802.5.TURN was the only intervenor that addressed the ratemaking treatment of customer deposits for PG&E.VerifiedAdditional Comments on Part II: #Intervenor’s CommentCPUC DiscussionPartial Success:The statutory definition of “substantial contribution” in Section 1802 of the PU Code states that a contribution results because the Commission “has adopted in whole or in part one or more factual contentions, legal contentions, or specific policy or procedural recommendations presented by the customer.”The Commission has interpreted the “in whole or in part” provision, in conjunction with Section 1801.3, so as to effectuate the legislature’s intent to encourage effective and efficient intervenor participation. The Commission has established as a general proposition that when a party makes a substantial contribution in a multiissue proceeding, it is entitled to compensation for time and expenses even if it does not prevail on some of the issues. See, for example, D.9804028 (awarding TURN full compensation in CTC proceeding, even though TURN did not prevail on all issues); D.9808016, pp. 6, 12 (awarding TURN full compensation in SoCalGas PBR proceeding); D.0002008, pp. 47, 10 (awarding TURN full compensation even though we unsuccessfully opposed settlement).In this proceeding, TURN suggests that on the two key issues – the use of a wildfire risk adder, and the level of the ROE – the Commission either adopted TURN’s recommendation or reached on outcome significantly closer to TURN’s recommendation than the IOUs’ recommendations. As discussed above, the Commission rejected a wildfire risk adder; and, aside from SoCalGas, the Commission adopted ROEs significantly closer to TURN’s position than to the IOUs positions.NotedPART III:REASONABLENESS OF REQUESTED COMPENSATIONGeneral Claim of Reasonableness (§ 1801 and § 1806):CPUC Discussiona. Intervenor’s claim of cost reasonableness: TURN requests compensation of approximately $195,000 for its work in this proceeding. TURN’s primary contribution in this proceeding was to provide legal and technical analyses and arguments that assisted the Commission in concluding that a separate wildfire risk adder was unwarranted, and in finding that no increase to utility equity returns was warranted. While TURN cannot take sole credit, since several intervenors submitted expert testimonies addressing similar issues, TURN notes that the equity returns proposed by TURN’s witness Gorman were in most cases the closest to the values adopted by the Commission. (Only FEA recommended slightly higher numbers than TURN.)While it is impossible to calculate the exact financial impact of TURN’s participation, an approximate benefit can be derived based on the original IOU applications, which quantified the revenue requirement increases associated with the requests. When those increases are scaled to correspond to the revised utility requests submitted on August 1, 2019, the ratepayer impact of the utility requests (above current levels, which are equal to the authorized levels) is a total of approximately $700 million in annual revenue requirements (and equity profits) for the four utilities. (The utilities’ original requests submitted in April 2019 represented an annual rate increase of almost $2.7 billion.) This large amount of additional ratepayer costs that flow directly to shareholders is the reason why several intervenors, representing residential customers, commercial and industrial customers, and the federal government, spent considerable resources to oppose the utility requests.Notedb. Reasonableness of hours claimed: TURN devoted a total of approximately 250 hours of attorney time and approximately 725 hours of expert witness and analyst time for work in this proceeding. As discussed previously, TURN was responsible for the costs of approximately 60% of outside expert costs. TURN suggests that this amount of time was entirely reasonable in order to conduct all of the financial modeling, technical analyses and legal research and analyses, so as to address equity return and capital structure issues and utility risks in California for all four large energy utilities for the next threeyear period. As mentioned above, the ratepayer impacts of the utility proposals represented a total annual rate increase of approximately $700 million, and all of that money would flow directly to shareholders, rather than covering any necessary utility investments or operations.TURN details that nature of the attorney and expert work below. Reasonableness of Attorney Hours:Marcel HawigerTURN devoted a total of approximately 253 hours of attorney time, primarily for work performed by attorney Marcel Hawiger, who was the lead attorney on this proceeding.Mr. Hawiger has been a staff attorney with TURN since 1998. Mr. Hawiger has been the lead attorney on various proceedings, including general rate cases, electric and gas procurement cases, cases addressing demandside management programs and policies, and various applications for utility infrastructure investments. Mr. Hawiger was the lead attorney in the test year 2013 cost of capital proceeding. In this proceeding, Mr. Hawiger represented TURN at hearings and drafted all pleadings and briefs submitted by TURN. Mr. Hawiger assisted Mr. Gorman and BAI in the drafting of testimony related to California regulatory and wildfire risks. Mr. Hawiger conducted legal analyses and writing related to the impacts of AB 1054. Mr. Hawiger assisted Mr. Marcus in the drafting of testimony related to the customer deposits issue.Other AttorneysTURN claims a very limited number of hours (about 20 hours total) for other attorneys who conducted work or provided advice during the course of the proceeding due to particular expertise in certain topics, the need to substitute attorneys based on scheduling constraints, or in the regular course of due diligence oversight.Reasonableness of Expert Hours:Jennifer DowdellMs. Dowdell, who is an Energy Analyst with TURN, has over 30 years of experience in the energy and financial sectors. Ms. Dowdell has held positions in engineering, corporate communications, investment research, merchant banking, project finance, venture capital, and accounting operations at leading corporations. Ms. Dowdell’s utility experience includes four years in design engineering and environmental compliance at Exelon Corporation, and four years developing independent power projects in California for Calpine Corporation. For 13 years, Ms. Dowdell worked for Pacific Gas and Electric Company in a variety of consulting and employee roles, including six years at the leadership/directorlevel. In this proceeding, Ms. Dowdell reviewed various testimonies and briefs for technical accuracy and provided analyses and strategy support on issues related to cost of capital financial analyses, evaluation of wildfire risks, and evaluation of other regulatory and financial risks. Ms. Dowdell devoted approximately 40 hours to this proceeding.William MarcusMr. Marcus has provided TURN with technical and economic consulting and expert witness services for over 30 years, and has testified on numerous occasions before this Commission. In this case, Mr. Marcus devoted a very limited amount of time (less than two hours) and sponsored testimony concerning the issue of customer deposits for PG&E. Brubaker and Associates, Inc. (BAI)TURN, in partnership with the Energy Producers and Users Coalition (EPUC) and the Indicated Shippers (IS), retained the services of BAI to perform detailed financial modeling of equity returns for all of the four utilities, as well as to provide additional expert testimony regarding capital structures and the impact of business, financial and regulatory risks on utility returns in California. Given the extremely compressed timeline of this proceeding, BAI utilized several analysts to assist Mr. Gorman with the financial modeling and testimony preparation. In total, BAI billed approximately $110,000 for its services, and TURN paid approximately $67,000 of that amount, excluding travel expenses. Based on our prior experience in cost of capital cases, TURN suggests that $67,000 is an extremely reasonable cost for expert work conducting financial ROE modeling and risk analyses to determine the cost of capital and capital structures for four large energy utilities.Notedc. Allocation of hours by issue: TURN uses a combination of activity and issue codes when itemizing the hourly work performed by attorneys and consultants. Some work is fundamental to active participation in a Commission proceeding, and may not be allocable by issue, and/or the amount of time required may not vary by the number of issues. Examples of these tasks include reviewing other parties’ testimony and filings, reviewing the proposed and any alternate decision; attending prehearing conferences and ex parte meetings; and preparing compensation filings. TURN usually uses the activity code “GP” to represent such general participation time that is not allocable by issue. Some of the daily work in this proceeding spanned multiple issues and could not be separately coded by issue. TURN generally used the activity code “#” to denote such work that covers multiple issue. TURN attorneys used the following activity codes and issue codes used for time accounting in these consolidated proceedings:CodeIssueDescriptionGPGeneralGeneral work necessary for participation which does not necessarily vary with the number of issues#Multiple IssuesWork covering multiple issues that cannot be easily segregatedROEModeling of ROEFinancial modeling of ROE, including proxy group and other assumptionsWRWildfire RiskEvaluation of any unique risks to electric utilities that require an equity adder due to inverse condemnation and wildfire risk in California after the passage of AB 1054CoordCoordinationCoordination with other intervenors re. issues and to minimize duplicationDiscDiscoveryDiscovery issues that cannot be easily categorized writing data requests; addressing discovery disputesCalif RisksCalifornia Business and Regulatory RisksEvaluation of any unique risks in California that warrant increased equity returns due to California regulatory and energy policies that impact cost recoveryGHHearingsAttending evidentiary hearings; other work related to hearings not easily allocable to issues Due to the overlap of issues and the press of work under a tight timeframe, a more than typical number of attorney hours in this case were coded using “#,”reflecting review of draft testimonies and drafting of pleadings that addressed a combination of wildfire risk (WR), California risks (Calif Risks) and ROE modeling (ROE) issues.TURN’s experts and consultants did not track work by issue code. The majority of the work performed by the various consultants from BAI addressed the technical financial modeling necessary to derive appropriate ROEs and capital structures. The rest of the work focused on evaluating the nature of Californiaspecific risks, including wildfire risk and regulatory risk. This work was conducted in close coordination with TURN attorney Hawiger and TURN analyst Dowdell.Based on the detailed coding of the attorney time sheets, as well as on a review of the pleadings in this case, and based on the personal knowledge of TURN’s attorney on this case, the approximate allocation of time by substantive issue, using the above codes, is as follows:Issue Code% of Attn Time% of Expert TimeROE15%60%WR35%25%Calif Risks25%10%CD/GH/GP/Discovery/Coord/Other25%5%NotedSpecific Claim:*ClaimedCPUC AwardATTORNEY, EXPERT, AND ADVOCATE FEESItemYearHoursRate $Basis for Rate*Total $HoursRate $Total $AttorneysRobert Finkelstein20190.50$540.00D.1911015$270.000.5$540.00$270.00Hayley Goodson20190.25$445.00Res. ALJ357 (2.35% 2019 COLA) $111.250.25$445.00$111.25Katy Morsony201919.50$350.00Res. ALJ357 (2.35% 2019 COLA plus the second 5% step increase in the 57 year experience tier), capped at top of range$6,825.0019.5$350.00$6,825.00Marcel Hawiger2019231.25$445.00D.1911011$102,906.25231.25$445.00$102,906.25Thomas J. Long20191.75$615.00D.1911015$1,076.251.75$615.00$1,076.25ExpertsJennifer Dowdell 201939.00$275.00See Comment 2$10,725.0039.00$275.00$10,725.00William Perea Marcus20191.66$295.00Res. ALJ357 (2.35% 2019 COLA) $489.701.66$295.00$489.70Christopher Walters, Brubaker & Associates201997.99$155.00New Request$15,188.4597.99$155.00$15,188.45Colin Fitzhenry, Brubaker & Associates201970.27$110.00New Request$7,729.7070.26 [1]$110.00$7,728.60Jessica York, Brubaker & Associates20195.02$150.00New Request$753.005.02$150.00$753.00Monet M. Covington, Brubaker & Associates2019107.20$90.00See Comment 3$9,648.00107.23[2]$90.00$9,650.70Maggie G. Ackenhausen, Brubaker & Associates2019207.04$135.00See Comment 3$27,950.40207.04$135.00$27,950.40Michael P. Gorman, Brubaker & Associates2019198.01$250.00See Comment 3$49,502.50198.01$250.00$49,502.50Adjustment for TURN Share of BAI Costs2019See Comment 4($43,523.83)($43,523.83)Subtotal: $189,651.68Subtotal: $189,653.27INTERVENOR COMPENSATION CLAIM PREPARATION **ItemYearHoursRate $ Basis for Rate*Total $HoursRate Total $Marcel Hawiger202015.0$222.501/2 of 2020 Rate; See Comment 5$3,412.5015.0$222.50$3,337.50 [3]Subtotal: $3,412.50Subtotal: $3,337.50COSTS#ItemDetailAmountAmount1.Parking expensesParking fees relating to proceeding A.1904014, et al.$37.50 $37.502.Consultant TravelConsultant travel fees and expenses relating to the proceeding$847.75 $847.753.PhotocopiesPhotocopy expenses related to TURN prepared testimony and pleadings provided to the Commission.$64.50 $64.504.Lexis Legal ResearchComputerized research costs associated with the preparation of TURN's legal arguments$113.74 $113.745.LodgingLodging charges relating to proceeding A.1904014, et al.$769.43 $769.436.PhonePhone expenses relating to proceeding A.1904014, et al.$5.67 $5.677.PostagePostage expenses related to TURN prepared testimony and pleadings mailed to the Commission.$16.30 $16.30Subtotal: $1,854.89Subtotal: $1,854.89TOTAL REQUEST: $194,919.07TOTAL AWARD: $194,845.66 *We remind all intervenors that Commission staff may audit the records and books of the intervenors to the extent necessary to verify the basis for the award (§1804(d)). Intervenors must make and retain adequate accounting and other documentation to support all claims for intervenor compensation. Intervenor’s records should identify specific issues for which it seeks compensation, the actual time spent by each employee or consultant, the applicable hourly rates, fees paid to consultants and any other costs for which compensation was claimed. The records pertaining to an award of compensation shall be retained for at least three years from the date of the final decision making the award. **Travel and Reasonable Claim preparation time are typically compensated at ? of preparer’s normal hourly rate ATTORNEY INFORMATIONAttorneyDate Admitted to CA BARMember NumberActions Affecting Eligibility (Yes/No?)If “Yes”, attach explanationMarcel HawigerJanuary 1998194244NoHayley GoodsonDecember 2003228535NoKaty MorsonyDecember 2011281538NoBob FinkelsteinJanuary 1990146391NoThomas LongDecember 1986124776NoAttachments Documenting Specific Claim and Comments on Part III:Attachment or Comment #Description/CommentAttachment 1Certificate of ServiceAttachment 2Attorney Time SheetsAttachment 3Expert Time SheetsThe expert time sheets contain the total number of hours expended by each expert. TURN notes that the totals for consultants from Brubaker and Associates, Inc., do not match the totals used for calculating the actual billed amounts, due to the fact that TURN shared some of the consulting costs of these witnesses with EPUC. TURN paid for 50% of all work related to PG&E, SCE and SoCalGas, and 100% of the work related to SDG&E. TURN has submitted a separate spreadsheet used to develop the compensation claim only to the iComp coordinator. TURN has confirmed that the amounts requested for compensation accurately match the actual amounts paid or owing to Brubaker and Associates.Attachment 4Direct Expenses DetailAttachment 5Statements of Qualifications for BAI consultants Ackenhousen, Covington, Fitzhenry, Gorman, Walters and ment 1: Time KeepingTURN’s attorneys and experts maintained detailed contemporaneous time records indicating the number of hours devoted to work on this case. In preparing this compensation request, Mr. Hawiger reviewed all of the recorded hours devoted to this proceeding and included only those that were reasonable and relevant to the issues addressed in the decisions. Comment 2Hourly Rate for Jennifer Dowdell for 2019TURN requests that the Commission authorize an hourly rate of $275 for Ms. Dowdell’s work in 2019. TURN has already requested this same rate be authorized for Ms. Dowdell in a in a compensation request filed in R.1901006 on September 5, 2019. TURN does not therefore reiterate the justification for this rate in this compensation request, and TURN asks, and that the Commission coordinate to authorize a single hourly rate for 2019 for Ms. Dowdell. If the Commission so desires, TURN would be happy to amend this request to include the justification for Ms. Dowdell’s 2019 rate. Comment 3Hourly Rates for Consultants with Brubaker & Associates, Inc. for 2019Twelve experts and analysts from Brubaker & Associates, Inc. (BAI) provided analyses and support for the testimony submitted by Mr. Michael Gorman. Because six provided minimal services, TURN requests compensation for work conducted by six experts and analysts. TURN requests that the Commission authorize as reasonable, based on their professional training and experience, the hourly rates actually charged by BAI for the work of these consultants.TURN has previously requested authorization of the hourly rates for three of these consultants – Michael Gorman, Magdalena Ackenhousen, and Monet Covington, in a compensation request filed in R.1901006 on September 5, 2019. This is TURN’s first request for compensation that includes work performed by BAI consultants Jessica York, Christopher Walters, and Colin Fitzhenry. TURN discusses the requested rates for each of these BAI consultant experts and demonstrates the reasonableness of each rate for 2019 below (in alphabetical order). The corporate statements of qualifications for each expert are included in Attachment 5. Please note that TURN also summarizes the justifications originally provided in R.1901006 for consultants Ackenhousen, Covington, and Gorman, and TURN requests that the Commission coordinate to authorize a single hourly rate for 2019 for the three overlapping experts.Magdalena G. AckenhausenMagdalena Ackenhausen is an Associate Consultant at Brubaker & Associates, Inc. (“BAI”), where she has worked for 15 years (2004 – Present). While at BAI, Ms. Ackenhausen has analyzed utility bills, tested alternative rates, prepared cost of service and depreciation studies, and evaluated economic and energy markets. She has also been involved in regulatory proceedings for utilities emerging from bankruptcy. Ms. Ackenhausen received a BS in Business Administration with a concentration in Finance from Truman State University and an MBA from the University of Missouri in Saint Louis. TURN requests an hourly rate of $135 for Ms. Ackenhausen’s work in 2019. This is the hourly rate charged by BAI for Ms. Ackenhausen’s expert services.The requested hourly rate of $135 is below the low end for 2019 rates adopted by the Commission in Resolution ALJ357 for experts with 13+ years of experience, which is $185$455. At the time Ms. Ackenhausen performed work for TURN in this proceeding (2019), she had more than 15 years of experience working on utility bills, rates, energy markets, and utility bankruptcy proceedings. Given Ms. Ackenhausen’s experience, TURN submits that a rate of $135 is very reasonable for her work.Monet M. CovingtonMonet Covington is an Analyst at Brubaker & Associates, Inc. (“BAI”), where she has worked for 3 years (2016 – Present). While at BAI, Ms. Covington’s analytical experience includes cost of capital, capital structure, and energy procurement. She has also analyzed billing data to estimate impacts on clients from utilityproposed rate changes. Ms. Covington received a BA in Economics with a minor in Mathematics from Saint Louis University. TURN requests an hourly rate of $90 for Ms. Covington’s work in 2019. This is the hourly rate charged by BAI for Ms. Covington’s expert services. The requested hourly rate of $90 is below the low end for 2019 rates adopted by the Commission in Resolution ALJ357 for experts with 06 years of experience, which is $155$220. At the time Ms. Covington performed work for TURN in this proceeding (2019), she had more than 3 years of experience working on issues related to utilities and capital structure. Given Ms. Covington’s experience, TURN submits that a rate of $90 is very reasonable for her work.Colin FitzhenryMr. Fitzhenry is an Assistant Engineer at BAI. Since joining BAI in January 2013, Mr. Fitzhenry has provided assistance in utility proceedings related to transmission planning, fuel cost recovery, environmental compliance plans, mergers, asset transfers, electrical and commodity price forecasting, and power procurement.Mr. Fitzhenry received a Bachelor of Science in General Engineering from the University of Illinois UrbanaChampaign. Prior to joining BAI, Mr. Fitzhenry served as an Engineer Intern for Dynegy Inc., where he was involvedwith generation operation at both Vermilion Power Station and TiltonPower Station.TURN requests $110 for Mr. Fitzhenry’s work in 2019. This is the hourly rate charged by BAI for Mr. Fitzhenry’s expert services. The requested hourly rate of $110 is below the low end for 2019 rates adopted by the Commission in Resolution ALJ357 for experts with 06 years of experience, which is $155$220. At the time Mr. Fitzhenry performed work for TURN in this proceeding (2019), he had more six years of experience working on issues related to utilities and capital structure. Given Mr. Fitzhenry’s experience, TURN submits that a rate of $110 is extremely reasonable.Michael P. Gorman Michael P. Gorman is a Managing Principal with Brubaker & Associates, Inc. (BAI), an energy, economic and regulatory consulting firm, where he has worked for almost 30 years (1990–1995 at the predecessor firm DrazenBrubaker & Associates; and 1995 – Present at BAI). Mr. Gorman has sponsored testimony on cost of capital, revenue requirements, cost of service, and other issues before the Federal Energy Regulatory Commission, 34 state regulatory commissions, including California, the provincial regulatory boards in Alberta and Nova Scotia, Canada, and various municipal regulatory boards. During this time, he has performed various analyses and sponsored testimony on cost of capital, cost/benefits of utility mergers and acquisitions, utility reorganizations, level of operating expenses and rate base, cost of service studies, and analyses related to industrial jobs and economic development. Mr. Gorman’s earlier professional experiences include 6 years at the Illinois Commerce Commission as an analyst, Senior Analyst, and eventually the Director of the Financial Analysis Department (1983–1989) and a year with MerrillLynch as a financial consultant (19891990). Mr. Gorman received a Master’s Degree in Business Administration with a concentration in Finance from the University of Illinois at Springfield and a BS in Electrical Engineering from Southern Illinois University. TURN requests an hourly rate of $250 for Mr. Gorman’s work in 2019. This is the hourly rate charged BAI for Mr. Gorman’s expert services. The requested hourly rate of $250 is in the bottom quartile of the range for 2019 rates adopted by the Commission in Resolution ALJ 357 for experts with 13+ years of experience, which is $185$455. Given Mr. Gorman’s 35+ years of experience working on utility financial analysis, TURN submits that this is a very reasonable rate for Mr. Gorman.TURN also notes that the requested rate of $250 is equivalent to the rate adopted by the Commission in D.1312052 for Daniel Lawton in 2012, $225, when escalated by the annual COLAs provided for in Resolutions ALJ287, 303, 308, 329, 345, 352, and 357. TURN had employed Mr. Lawton as a utility financial expert in the Cost of Capital proceeding, A.1204015 et al. At that time, Mr. Lawton had almost 30 years of experience (19832012) as an economist who is an expert in utility financial and rate matters. (See D.1312052, pp. 1718).Christopher WaltersMr. Walters is an Associate at BAI. Since joining BAI in 2011, Mr. Walters has been involved with various regulated electric, natural gas and water regulatory proceedings, addressing issues related to cost of capital, capital structure, financial integrity, mergerrelated issues and evaluations, risk management, revenue requirements, depreciation studies, price forecasts, and energy procurement.Mr. Walters received a Bachelor of Science Degree in Business Economics and Finance from Southern Illinois University Edwardsville and an MBA from Lindenwood University in 2011. Mr. Walters is a Chartered Financial Analyst (CFA) and a member of the CFA Institute and the CFA Society of St. Louis.TURN requests $155 for Mr. Walters’ work in 2019. This is the hourly rate charged by BAI for Mr. Walters’ expert services. The requested hourly rate of $155 is below the low end for 2019 rates adopted by the Commission in Resolution ALJ357 for experts with 712 years of experience, which is $185$305. At the time Mr. Walters performed work for TURN in this proceeding (2019), he had more than eight years of experience working on issues related to utilities and capital structure. Given Mr. Walters’ experience, TURN submits that a rate of $155 is very reasonable for his work.Jessica YorkJessica York is a Senior Consultant at Brubaker & Associates, Inc. (“BAI”), where she has worked for 9 years (2011 – Present). While at BAI, Ms. York has been involved in numerous projects in both regulated and deregulated markets. She has worked in various electric, natural gas and water regulatory proceedings addressing cost of capital, sales revenue forecast, revenue requirement assessments, class cost of service studies, rate design, and various policy issues.Ms. York received a Bachelor of Science Degree in Mathematics with minors in Statistics and Actuarial Science from Truman State University and an MBA, with a concentration in Finance, from the University of MissouriSt. Louis.TURN requests an hourly rate of $150 for Ms. York’s work in 2019. This is the hourly rate charged by BAI for Ms. York’s expert services. The requested hourly rate of $150 is below the low end for 2019 rates adopted by the Commission in Resolution ALJ357 for experts with 712 years of experience, which is $185$305. Given Ms. York’s education and experience, TURN submits that a rate of $150 is very reasonable for her ment 4Monetary Adjustment to BAI CostsTURN requests compensation for the actual costs billed by BAI for the work of Mr. Gorman, together with five other consultants who assisted him. In the detailed hourly spreadsheet, TURN includes the actual hourly billing for all consultants. Based on our consultant agreement, TURN paid 100% of the costs for work concerning SDG&E and 50% of the costs for work concerning PG&E, SCE and SoCalGas. In the spreadsheet of claimed expert time, TURN included 100% of the hourly work recorded by BAI, and then subtracts the actual amounts that were not billed to TURN. TURN thus paid $67,248 of the total hourly billed amount of $110,772, or approximately 61%. TURN paid a proportionate share of travel expenses for Mr. Gorman’s appearance at evidentiary ment 5Hourly Rate for Marcel Hawiger for 2020The Commission has yet to adopt a 2020 COLA for intervenor hourly rates.??Pending the Commission’s COLA determination, TURN has used a placeholder COLA of 2% to calculate a 2020 rate for TURN Staff Attorney Marcel Hawiger (for work related to the compensation request).??Applying a 2% COLA to Mr. Hawiger’s authorized 2019 hourly rate of $445 yields a 2020 hourly rate of $455 when rounded to the nearest $5.??If the Commission adopts a COLA that supports a different hourly rate for Mr. Hawiger, TURN requests that the Commission adjust the requested 2020 hourly rate accordingly.D. CPUC Comments, Disallowances, and Adjustments:ItemReason[1]Fitzhenry hours adjusted to reflect timesheet in Attachment 3.[2]Covington hours adjusted to reflect timesheet in Attachment 3.[3]The Commission has not approved a COLA as of the date of this decision. Therefore, the intervenor compensation claim amount is adjusted slightly downward.PART IV:OPPOSITIONS AND COMMENTSWithin 30 days after service of this Claim, Commission Staff or any other party may file a response to the Claim (see § 1804(c))A. Opposition: Did any party oppose the Claim?NoB. Comment Period: Was the 30day comment period waived (see Rule 14.6(c)(6))?YesFINDINGS OF FACTThe Utility Reform Network has made a substantial contribution to D.1912056.The requested hourly rates for The Utility Reform Network’s representatives are comparable to market rates paid to experts and advocates having comparable training and experience and offering similar services.The claimed costs and expenses, as adjusted herein, are reasonable and commensurate with the work performed. The total of reasonable compensation is $194,845.66.CONCLUSION OF LAWThe Claim, with any adjustment set forth above, satisfies all requirements of Pub.?Util. Code §§ 18011812.ORDERThe Utility Reform Network shall be awarded $194,845.66.Within 30 days of the effective date of this decision, Pacific Gas and Electric Company, Southern California Edison Company, San Diego Gas and Electric Company, and Southern California Gas Company shall pay The Utility Reform Network their respective shares of the award, based on their Californiajurisdictional electric and gas revenues for the 2019 calendar year, to reflect the year in which the proceeding was primarily litigated. If such data is unavailable, the most recent electric and gas revenue data shall be used. Payment of the award shall include compound interest at the rate earned on prime, threemonth nonfinancial commercial paper as reported in Federal Reserve Statistical Release H.15, beginning April 25, 2020, the 75th day after the filing of The Utility Reform Network’s request, and continuing until full payment is made.The comment period for today’s decision is waived.This decision is effective today.Dated _____________, at San Francisco, California.APPENDIXCompensation Decision Summary InformationCompensation Decision:Modifies Decision? NoContribution Decision(s):D1912056Proceeding(s):A1904014, A1904015, A1904017, and A1904018Author:ALJ StevensPayer(s):Pacific Gas and Electric Company, Southern California Edison Company, San Diego Gas and Electric Company and Southern California Gas Company.Intervenor InformationIntervenorDate Claim FiledAmount RequestedAmount AwardedMultiplier?Reason Change/DisallowanceThe Utility Reform Network 2/18/20$194,919.07$194,845.66N/AHawiger 2020 hourly fee adjusted because no COLA has been approved for 2020. Hourly Fee InformationFirst NameLast NameAttorney, Expert, or AdvocateHourly Fee RequestedYear Hourly Fee RequestedHourly Fee AdoptedMarcelHawigerAttorney$4452019$445MarcelHawiger Attorney$4552020$455Robert FinkelsteinAttorney$5402019$540HayleyGoodson Attorney$4452019$445KatyMorsonyAttorney$3502019$350ThomasLong Attorney$6152019$615Jennifer DowdellExpert$2752019$275WilliamMarcusExpert$2952019$295ChristopherWalters Expert$1552019$155ColinFitzhenryExpert$1102019$110JessicaYorkExpert$1502019$150MonetCovingtonExpert$902019$90MagdalenaAckenhausenExpert$1352019$135MichaelGormanExpert$2502019$250(END OF APPENDIX) ................
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