Background - California

?ALJ/PD1/jnfDate of Issuance 12/21/2020Decision 20-12-024 December 17, 2020BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIAOrder Instituting Rulemaking to Consider Authorization of a Non-Bypassable Charge to Support California's Wildfire Fund.Rulemaking 1907017DECISION ADOPTING TIMING AND AMOUNT OF 2021 WILDFIRE FUND NON-BYPASSABLE CHARGESummaryThis decision adopts an amount for the Wildfire Fund Non-Bypassable Charge for January 2021 through December 2021. This proceeding is closed.BackgroundAssembly Bill (AB)?1054 (Ch. 79, Stats. 2019) (AB 1054) was enacted as an urgency measure to address increased risk of catastrophic wildfires in California, the electric utilities exposure to financial liability, and ratepayer costs. A companion bill AB?111 (Ch. 81, Stats. 2019) was also enacted. The Governor signed AB?1054 on July 12, 2019. The Commission issued an Order Instituting Rulemaking (OIR) at a meeting on July 26, 2019, consistent with Public Utilities (Pub. Util.) Code Section?3289, in response to legislative direction in AB?1054 to consider whether the Commission should exercise its authority to require certain electrical corporations to collect from ratepayers a nonbypassable charge to support California’s new Wildfire Fund defined in Pub. Util. Code Sections?1701.8 and 3280 et seq. The OIR contained a preliminary scope and schedule for the proceeding. Notice of the Rulemaking appeared on the Commission’s Daily Calendar on July 30, 2019. In the OIR, the Commission preliminarily categorized this proceeding as ratesetting and determined hearings were not necessary.After conducting regulatory proceedings in August 2019, the Commission issued a final decision on significant issues within the scope of this proceeding – Decision (D.)?1910056 – on October 24, 2019, in compliance with statutorily imposed deadlines. The procedural history of this proceeding is summarized in that decision. D.1910056 found that the imposition of a Wildfire Fund nonbypassable charge (Wildfire Fund NBC) contemplated by AB?1054 was just and reasonable, and kept this proceeding open. Subsequently, the Commission issued D.2002070 denying application for rehearing of D.1910056 on March?2,?2020.On July 16, 2020, the Commission adopted D.2007014, which considered and approved Servicing Orders between the large electrical corporations and the California Department of Water Resources (DWR). The servicing orders approved by that decision allow the large electrical corporations to act as agents of DWR and collect and remit to DWR the proceeds of the Wildfire Fund NBC in order to assure that the Wildfire Fund NBC will be available to carry out the uses outlined in AB 1054.On September 24, 2020, the Commission adopted D.2009023 which directed the large electrical corporations to begin charging eligible ratepayers a Wildfire Fund NBC in the amount of $0.00580/kilowatt-hour (kWh) in 2020, beginning October 1, 2020. On September 29, 2020, DWR sent the Commission a 90-day notice asking the Commission to adopt a 2021 Wildfire Fund NBC in the amount of $0.00580/kWh, to be charged by the large electrical corporations to customers subject to the Wildfire Fund NBC beginning January 1, 2021. The assigned Administrative Law Judge (ALJ) issued an email ruling on September 30, 2020, attaching the 90-day notice and seeking party comment on the contents of the 90day notice, including the proposed start date and amounts of the Wildfire Fund NBC for 2021. Party comments were served and filed on October 14, 2020, by San Diego Gas & Electric Company (SDG&E) and Ruth Henricks. Reply comments were filed by Southern California Edison Company on October 21, 2020.Issues Before the CommissionAs defined in the scoping memo, this proceeding may consider issues relating to the Wildfire Fund NBC that must be addressed before the Wildfire Fund NBC may be imposed. In order for the Wildfire Fund NBC to be imposed in 2021, a start date and an amount for the Wildfire Fund NBC must be established. Therefore, as these issues must be addressed before the 2021 Wildfire Fund NBC may be imposed, the issues of the start date and amount of the Wildfire Fund NBC are properly within the scope of this proceeding.DiscussionThe imposition of the Wildfire Fund NBC was found to be just and reasonable by the Commission in D.1910056. That decision held that the Wildfire Fund NBC is to be collected on a dollar per kWh basis to ensure consistency with AB?1054, and that the combined annual revenue requirement for the Wildfire Fund NBC is to be $902.4?million.D.1910056 also adopted a Rate Agreement between the Commission and DWR that bound the Commission to calculate, revise and impose from time to time the Wildfire Fund NBC sufficient to fund at all times the $902.4?million annual revenue requirement, as well as a process for considering the start date for the Wildfire Fund NBC and the amount to be charged.D.1910056 did not establish a specific process for consideration of the 2021 Wildfire Fund NBC, and instead stated that for every year after 2020, an annual Wildfire Fund NBC charge determination process shall be considered in future Commission decisions. For the purpose of considering the 2021 Wildfire Fund NBC, this decision adopts a process similar to that used to consider the 2020 Wildfire Fund NBC, namely that a 90day notice be submitted by DWR to the Commission before the imposition of the Wildfire Fund NBC in 2021, which would contain the following elements:The revenue requirement for the Wildfire Fund NBC for the year 2021.The electricity sales forecast for all anticipated participating large electrical corporations for 2021.DWR’s calculation of the resulting 2021 Wildfire Fund NBC for customers subject to the Wildfire Fund NBC pursuant to D.19-10-056.The process outlined above is a reasonable way to calculate and approve the amount of the Wildfire Fund NBC in future years. In order to provide a proceeding in which to consider submissions from DWR to calculate the Wildfire Fund NBC, the Commission will open a rulemaking in early 2021 to consider the calculation of separate Wildfire Fund NBCs for the years 2022 and 2023. This rulemaking will consider annual submissions from DWR as described in the paragraph above, including a 60day notice if appropriate, when determining the appropriateness of the amount of the Wildfire Fund NBC in 2022 and 2023.The 90day notice transmitted by DWR on September 29, 2020, proposes that the 2021 Wildfire Fund NBC be set at a level of $0.00580 per kWh to collect a 2021 revenue requirement of $902.4?million. DWR calculated the 2021 Wildfire Fund NBC amount using estimates of the eligible kWh sales expected during 2021, which were based on the results of data requests provided by the large electrical corporations on June 19, 2020. The responses to the data requests provide forecasted load at the customer meter for bundled load, direct access load, and community choice aggregation load with additional details for the load in these categories that would not be exempt from the Wildfire Fund NBC. DWR calculated the amount of the Wildfire Fund NBC in 2021 by using a “collection curve methodology.” DWR reported that it took the estimated eligible kWh sales (or “non-exempt load”) for 2021 provided to DWR by the large electrical corporations, and then multiplied that figure by an assumed Wildfire Fund NBC amount to determine a forecasted remittance accrual. DWR reduced this accrual amount by a forecasted uncollectible factor. The resulting accrual amount was then projected to be received as cash 45 days later by DWR.In its 90-day notice, DWR restated its obligation under the Rate Agreement to notify the Commission each year by November 1, of the annual collections received by DWR with respect to the Wildfire Fund revenue requirement and the amount of excess or deficiency in collections above or below the revenue requirement. The 90day notice also points out that under the terms of the Rate Agreement the Commission will undertake within 60?days to adjust the Wildfire Fund NBC in the subsequent year to reflect any excess or deficiency reported by DWR. No party challenged the reasonableness of the sales forecasts or the total Wildfire Fund NBC revenue requirement to be collected. SDG&E supported the calculation of the 2021 Wildfire Fund NBC for non-exempt customers of the large electrical corporations beginning January 1, 2021 in the amount of $0.00580 per kWh. Ruth Henricks opposed the imposition of the 2021 Wildfire Fund NBC in general, positing arguments previously made in this proceeding that such imposition is unjust, unreasonable, unsafe, and fails to comply with due process requirements. Ruth Henricks did not argue that the 2021 Wildfire Fund NBC was inappropriately calculated, or challenge the data relied upon by DWR to make the calculation. SCE urged the Commission to reject Ruth Henrick’s arguments, asserting that they were already considered and rejected earlier in this proceeding.Because Ruth Henricks relitigates claims regarding the inappropriateness of the Wildfire Fund NBC in general, which were disposed of in D.1910056, and again when considering her application for rehearing, these collateral arguments should be summarily rejected by this decision. D.1910056 held that the imposition of the Wildfire Fund NBC is just and reasonable, and this decision does not disturb that holding.DWR’s 90-day notice provides the revenue requirement for the Wildfire Fund NBC for the year 2021, the electricity sales forecast for all anticipated participating large electrical corporations for 2021, and DWR’s calculation of the resulting 2021 Wildfire Fund NBC for customers subject to the Wildfire Fund NBC pursuant to D.1910056. Therefore, DWR’s 90day notice provides the Commission with sufficient information to set the amount of the Wildfire Fund NBC for 2021.In light of the reasonableness of the information submitted by DWR, and the fact that the data supplied by DWR are not contested by any party, this decision finds that it is reasonable to set the amount of the Wildfire Fund NBC as $0.00580/kWh for 2021. The large electrical corporations shall charge this Wildfire Fund NBC amount during 2021 to customers subject to the Wildfire Fund NBC as defined in D.1910056. Each of the large electrical corporations shall file a Tier 1 advice letter with the Commission’s Energy Division implementing the 2021 Wildfire Fund NBC as defined by this decision no later than December 31, ments on Proposed DecisionThe proposed decision of ALJ Doherty in this matter was mailed to the parties in accordance with Pub. Util. Code section 311 and comments were allowed under Rule 14.3 of the Commission’s Rules of Practice and Procedure. No party filed comments on the proposed decision.Assignment of ProceedingClifford Rechtschaffen is the assigned Commissioner and Patrick Doherty is the assigned ALJ in this proceeding.Findings of FactThe annual revenue requirement for the Wildfire Fund NBC is $902.4?million.The data used by DWR to calculate the 2021 Wildfire Fund NBC were not contested by any party and may be relied upon by the Commission to adopt the 2021 Wildfire Fund NBC amount.Conclusions of LawThe imposition of the Wildfire Fund NBC was found to be just and reasonable by the Commission in D.1910056.The Wildfire Fund NBC is to be collected on a dollar per kWh basis to ensure consistency with AB?1054. DWR’s 90day notice provides the Commission with sufficient information to set the amount of the Wildfire Fund NBC for 2021.It is reasonable to set the amount of the Wildfire Fund NBC as $0.00580/kWh for 2021.ORDERIT IS ORDERED that:Southern California Edison Company shall charge the Wildfire Fund Non-Bypassable Charge to customers as defined by Decision 19-10-056 during 2021 in the amount of $0.00580 per kilowatt-hour.Southern California Edison Company shall file a Tier 1 advice letter with the Commission’s Energy Division implementing the 2021 Wildfire Fund NonBypassable Charge as defined by this decision no later than December?31,?2020.San Diego Gas & Electric Company shall charge the Wildfire Fund NonBypassable Charge to customers as defined by Decision 19-10-056 during 2021 in the amount of $0.00580 per kilowatt-hour.San Diego Gas & Electric Company shall file a Tier 1 advice letter with the Commission’s Energy Division implementing the 2021 Wildfire Fund NonBypassable Charge as defined by this decision no later than December?31,?2020.Pacific Gas and Electric Company shall charge the Wildfire Fund NonBypassable Charge to customers as defined by Decision 19-10-056 during 2021 in the amount of $0.00580 per kilowatt-hour.Pacific Gas and Electric Company shall file a Tier 1 advice letter with the Commission’s Energy Division implementing the 2021 Wildfire Fund NonBypassable Charge as defined by this decision no later than December?31,?2020.Rulemaking 19-07-017 is closed.This order is effective today.Dated December 17, 2020, at San Francisco, California.MARYBEL BATJER PresidentLIANE M. RANDOLPHMARTHA GUZMAN ACEVESCLIFFORD RECHTSCHAFFENGENEVIEVE SHIROMA Commissioners ................
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