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PVA/t94 7/6/01

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Order Instituting Rulemaking on the Commission’s Own Motion to Determine Whether Baseline Allowances for Residential Usage of Gas and Rulemaking 01-05-047 Electricity Should Be Revised.

ASSIGNED COMMISSIONER’S RULING AND SCOPING MEMO

This Ruling and Scoping Memo determines the schedule of this proceeding and the issues to be addressed, consistent with the requirements of Rule 6.3 of the Commission’s Rules of Practice and Procedure. This proceeding is categorized as ratesetting, evidentiary and public participation hearings are necessary, and Administrative Law Judge (ALJ) Peter V. Allen is designated as the principal hearing officer. (Rule 6(c)(2).) The ex parte procedures in Public Utilities Code § 1701.3 are applicable to this proceeding. In the Ruling of Assigned Commissioner and Administrative Law Judge Setting Prehearing Conference, dated June 11, 2001, this proceeding was bifurcated. This Scoping Memo will determine the schedule for Phase 1 of this proceeding. The schedule for Phase 2 will be determined later. Similarly, this Scoping Memo will identify the issues to be addressed in Phase 1. While some issues may be identified as appropriate to be addressed in Phase 2, this Scoping Memo is not determinative as to the scope of issues in Phase 2. Schedule A Prehearing Conference (PHC) was held on Thursday, June 21, 2001 before ALJ Allen and Assigned Commissioner Geoffrey Brown. Attendees addressed the scope and scheduling of this proceeding, and those comments were considered in the preparation of this Scoping Memo. The schedule for Phase 1 of this proceeding is:

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August 3, 2001 Opening testimony from utility respondents August 17 Testimony from ORA and intervenors August 24 Rebuttal testimony from utility respondents August 27-28 Public Participation Hearings1 September 4-7 Evidentiary Hearings September 10-12 Public Participation Hearings September 13-14 Evidentiary Hearings (if needed) September 20 Public Participation Hearing September 21 Concurrent Opening Briefs September 24 Public Participation Hearing September 28 Concurrent Reply Briefs October 19 Proposed Decision November 2 Comments on Proposed Decision November 9 Reply Comments on Proposed Decision November 29 Commission Decision This schedule is consistent with the Commission’s desire to act expeditiously on this matter, while acknowledging that even under a highly compressed schedule, a Decision could not take effect in time for the summer peak season. Accordingly, we are allowing time for a more thorough and careful process that will still allow for implementation of any changes in time for the winter peak heating season. Scope In a previous Ruling,2 we identified the issues to be examined in Phase 1 to be: 1) Updating the energy usage data used by the Commission in calculating baseline quantities;

1 Public Participation Hearings were previously scheduled, in an ALJ Ruling dated June 19, 2001, and are noted here for reference.

2 Ruling of Assigned Commissioner and Administrative Law Judge Setting Prehearing Conference, dated June 11, 2001.

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2) The appropriate percentage of energy usage to use in calculating baseline quantities (within the range specified by Public Utilities Code § 739(d)(1)); 3) Possible changes to the medical baseline allowance; and 4) Suggestions for legislative changes.

No party suggested any substantive change to this list of issues for Phase 1. Accordingly, these will remain the issues for Phase 1. We will, however, provide some elaboration and clarification of what we are looking for on these issues. In general, what we would find most useful is a clear description of current practice, and any specific changes that are recommended to that practice. 1) Updating the energy usage data used by the Commission in calculating baseline quantities.

Utilities are applying baseline quantities established in a variety of proceedings, presumably using usage data of varying vintages. For example, PG&E states that it last changed its effective electric baseline quantities in 1993, based on targets derived from 1990 recorded usage, while its target baseline gas quantity is based on 1993 usage. By comparison, Mountain Utilities states that its baseline rates were only established in late 1999. Given the recent significant changes in the California energy markets, it would appear reasonable to update the usage data (for all customer classes) that baseline quantities are based upon. We also wish to avoid arbitrary discrimination between customers of different utilities. All parties should feel free to make suggestions as to methodology. In its Prehearing Conference Statement, PG&E asked for guidance on “whether its analysis should use the traditional, adopted weather normalization of usage data, or some other method.” All parties may use what PG&E describes as “the traditional, adopted” approach, or may recommend another approach, as long as the approach chosen is clearly described and adequately supported. 2) The appropriate percentage of energy usage to use in calculating baseline quantities (within the range specified by Public Utilities Code § 739(d)(1)).

Utilities in particular, and others who are interested, should identify the percentage(s) currently used in calculating baseline quantities, and suggest any recommended changes to the currently used percentages, within the allowed statutory

- 3 - R.01-05-047 PVA/t94 range. Parties should identify any problems with the percentages used, or any perceived limitations on the Commission’s ability to adjust the percentages within the statutory range. To the extent that parties feel that the statutory ranges should be changed, they should address that issue under the below topic of “Suggestions for legislative changes.” 3) Possible changes to the medical baseline allowance. Again, we primarily want to make sure the Commission obtains a clear and complete picture of current practices, and ask parties to identify any problems with current practice, and to recommend any changes that would improve this important aspect of the baseline program. Parties should make the Commission aware of any practices or procedures in this area that are believed to be particularly effective.

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4) Suggestions for legislative changes. The authority of the Commission relating to baseline is generally prescribed by statute. If parties believe that the baseline program needs to be changed in ways that would require legislation, parties should identify (and support) the suggested changes, and describe what legislation would be required to implement such changes. Some of the smaller utilities expressed concerns about the cost of participating in this proceeding, and requested some form of relief from participation. ALJ Allen properly denied those requests at the PHC. As acknowledged by ALJ Allen, the level of active participation of each party in this proceeding, including each respondent utility, is up to that party.3 However, all respondent utilities remain parties to this proceeding, and are bound by the outcome of this proceeding, regardless of their level of active participation. It is assumed that all respondent utilities will continue to cooperate with the Commission’s Energy Division, and will respond promptly and thoroughly to its data requests. Responses to Energy Division’s data requests may be made part of the record, and the Commission may use that information as a basis for its ultimate decision(s) in this proceeding. Parties have inquired as to whether cost allocation issues would be addressed in this proceeding or another proceeding. We have determined that cost allocation issues will not be addressed in Phase 1 of this proceeding. Parties will be given an opportunity in the future to recommend where and how these issues should be addressed. Anyone who needs assistance with participation in this proceeding should make use of the resources on the Commission’s web site, www.cpuc.ca.gov, or should contact our Public Advisor’s Office, which is available to help parties understand how to participate in a proceeding, how to file a pleading, and to answer other questions about Commission procedure. The northern California office can be reached at 415-703-2074 or [email protected]. The southern California office can be reached at 213- 576- 7055 or [email protected].

3 We expect, however, that the larger utilities will fully and actively participate in this proceeding.

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IT IS RULED that: 1. The schedule for Phase 1 of this proceeding is described above. 2. The scope of Phase 1 of this proceeding is described above. 3. ALJ Allen is the principal hearing officer for these proceedings. 4. This proceeding is categorized as ratesetting. 5. The official service list is attached to this Ruling. Parties shall serve all testimony and filings on all parties listed on the service list, including those identified as “State Service.” Parties are not required to serve those listed under “Information Only,” but individuals or entities on the “Information Only” list that have provided an e-mail address should be served electronically with all testimony and filings. The Commission will serve all Rulings and Orders on the “Information Only” list. Dated July 6, 2001, at San Francisco, California.

/s/ GEOFFREY BROWN Geoffrey Brown Assigned Commissioner

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CERTIFICATE OF SERVICE

I certify that I have by mail, and by electronic mail to the parties to which an electronic mail address has been provided, this day served a true copy of the original attached Assigned Commissioner’s Ruling And Scoping Memo on all parties of record in this proceeding or their attorneys of record. Dated July 6, 2001, at San Francisco, California.

/s/ KAREN CILMAN Karen Cilman

N O T I C E

Parties should notify the Process Office, Public Utilities Commission, 505 Van Ness Avenue, Room 2000, San Francisco, CA 94102, of any change of address to insure that they continue to receive documents. You must indicate the proceeding number on the service list on which your name appears.

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The Commission’s policy is to schedule hearings (meetings, workshops, etc.) in locations that are accessible to people with disabilities. To verify that a particular location is accessible, call: Calendar Clerk (415) 703-1203.

If specialized accommodations for the disabled are needed, e.g., sign language interpreters, those making the arrangements must call the Public Advisor at (415) 703-2074, TTY 1-866-836-7825 or (415) 703-5282 at least three working days in advance of the event. ************ SERVICE LIST *********** Last Update on 05-JUL-2001 by: SMJ R0105047 LIST

************ APPEARANCES ************ Shawna Parks Attorney At Law James Weil 449 - 15TH STREET, SUITE 303 AGLET CONSUMER ALLIANCE OAKLAND CA 94612 PO BOX 1599 (510) 451-8644 FORESTHILL CA 95631 [email protected] (530) 367-3300 For: Disability Rights Advocates & CA Foundation for Independent [email protected] Living Centers For: Aglet Consumer Alliance Alessandra M. Messineo Long Attorney At Law Bruce W. Folsom SEMPRA ENERGY ATTORNEY AT LAW 101 ASH STREET, HQ12 PO BOX 3727, MSC-29 SAN DIEGO CA 92101-3017 SPOKANE WA 99220-3727 (619) 699-5077 (509) 495-8706 [email protected] [email protected] For: So. Cal. Gas Company and San Diego Gas & Electric For: Avista Utilities

Dan L. Carroll David M. Norris Attorney At Law Attorney At Law DOWNEY BRAND SEYMOUR & ROHWER, LLP SIERRA PACIFIC POWER COMPANY 555 CAPITOL MALL, 10TH FLOOR 6100 NEIL ROAD SACRAMENTO CA 95814 RENO NV 89511 (916) 441-0131 (775) 834-3939 [email protected] [email protected] For: Mountain Utilities For: Sierra Pacific

Lon W. House James M. Lehrer 4901 FLYING C ROAD Attorney At Law CAMERON PARK CA 95682-9615 SOUTHERN CALIFORNIA EDISON COMPANY (530) 676-8956 2244 WALNUT GROVE AVENUE [email protected] ROSEMEAD CA 91770 For: Regional Council of Rural Counties (626) 302-3252 [email protected] For: Southern California Edison Company Susan E. Brown Attorney At Law LATINO ISSUES FORUM Keith Switzer 785 MARKET STREET, 3RD FLOOR SOUTHERN CALIFORNIA WATER COMPANY SAN FRANCISCO CA 94103-2003 630 E. FOOTHILL BOULEVARD (415) 284-7220 SAN DIMAS CA 91773-9016 [email protected] (909) 394-3600 X 759 For: Latino Issues Forum [email protected] For: Southern California Water Company

Gail L. Slocum Attorney At Law Andrew W. Bettwy PACIFIC GAS AND ELECTRIC CO. EDWARD B. GIESEKING 77 BEALE ST. RM 3143 Attorney At Law SAN FRANCISCO CA 94105 SOUTHWEST GAS CORPORATION (415) 973-6583 5241 SPRING MOUNTAIN ROAD [email protected] LAS VEGAS NV 89150-0002 For: PG&E (702) 876-7107 [email protected] For: Southern Gas Corporation ************ SERVICE LIST *********** Last Update on 05-JUL-2001 by: SMJ R0105047 LIST

James C. Paine Dexter E. Khoury Attorney At Law Office of Ratepayer Advocates STOEL RIVES L.L.P. RM. 4205 900 S.W. FIFTH AVE., SUITE 2300 505 VAN NESS AVE PORTLAND OR 97204-1268 San Francisco CA 94102 (503) 294-9246 (415) 703-1200 [email protected] [email protected] For: PacifiCorp For: ORA

Matthew Freedman Sarvjit S. Randhawa Attorney At Law Energy Division THE UTILITY REFORM NETWORK AREA 4-A 711 VAN NESS AVENUE, SUITE 350 505 VAN NESS AVE SAN FRANCISCO CA 94102 San Francisco CA 94102 (415) 929-8876 EX314 (415) 703-2274 [email protected] [email protected] For: TURN Steven C Ross ********** STATE EMPLOYEE *********** Office of Ratepayer Advocates RM. 4102 Peter V. Allen 505 VAN NESS AVE Administrative Law Judge Division San Francisco CA 94102 RM. 5012 (415) 703-2140 505 VAN NESS AVE [email protected] San Francisco CA 94102 For: ORA (415) 703-1123 [email protected] Sarita Sarvate Energy Division Fernando De Leon AREA 4-A CALIFORNIA ENERGY COMMISSION 505 VAN NESS AVE 1516 - 9TH STREET MS-14 San Francisco CA 94102 SACRAMENTO CA 95814-5504 (415) 703-1506 (916) 654-4873 [email protected] [email protected] For: CEC Maria E. Stevens Executive Division Jennifer Tachera RM. 500 Attorney At Law 320 WEST 4TH STREET SUITE 500 CALIFORNIA ENERGY COMMISSION Los Angeles CA 90013 1516 NINTH STREET, MS-14 (213) 576-7012 SACRAMENTO CA 95814-5504 [email protected] (916) 654-3870 [email protected] Rosalina White For: CEC Public Advisor Office RM. 5303 Massis Galestan 505 VAN NESS AVE Energy Division San Francisco CA 94102 AREA 4-A (415) 703-2074 505 VAN NESS AVE [email protected] San Francisco CA 94102 For: Public Advisor's Office (415) 703-1760 [email protected] For: Energy Division ************ SERVICE LIST *********** Last Update on 05-JUL-2001 by: SMJ R0105047 LIST

Jason J. Zeller Joseph P. Como Legal Division Attorney At Law RM. 5002 1 DR. CARLTON B. GOODLETT PLACE, RM. 234 505 VAN NESS AVE SAN FRANCISCO CA 94102 San Francisco CA 94102 (415) 554-4700 (415) 703-4673 [email protected] [email protected] For: City and County of San Francisco For: ORA

********* INFORMATION ONLY ********** John Dutcher 3210 CORTE VALENCIA John Farrow FAIRFIELD CA 94533-7875 Attorney At Law (707) 421-8411 ADAMS BROADWELL JOSEPH & CARDOZO [email protected] 651 GATEWAY BLVD., NUMBER 900 For: Mountain Utilities SOUTH SAN FRANCISCO CA 94080 (650) 589-1660 Charles Foley [email protected] 8491 ANNANDALE For: California Utility Employees DHS CA 92240 (760) 251-6877 [email protected] Edward G. Poole Attorney At Law Jeanne M. Bennett ANDERSON & POOLE Attorney At Law 601 CALIFORNIA STREET, SUITE 1300 GOODIN MACBRIDE SQUERI RITCHIE & DAY LLP SAN FRANCISCO CA 94108 505 SANSOME STREET, SUITE 900 (415) 956-6413 SAN FRANCISCO CA 94111 [email protected] (415) 392-7900 For: Western Manufactured Housing Communities Assoc. [email protected] For: Enron Energy Services

Barbara R. Barkovich BARKOVICH AND YAP, INC. William R. Griffith 31 EUCALYPTUS LANE 825 NE MULTNOMAH STREET SAN RAFAEL CA 94901 PORTLAND OR 97232 (415) 457-5537 (503) 813-6051 [email protected] [email protected] For: CA Large Energy Consumers Assoc. For: Pacificorp

Robert E. Burt Lulu Weinzimer INSULATION CONTRACTORS ASSOCIATION CALIFORNIA ENERGY MARKETS 1911 F STREET 9 ROSCOE STREET SACRAMENTO CA 95814 SAN FRANCISCO CA 94110-5921 (916) 444-2950 (415) 824-3222 [email protected] [email protected] For: Insulation Contractors Association

Ronald Liebert Attorney At Law Jeff Nahigian CALIFORNIA FARM BUREAU FEDERATION JBS ENERGY, INC. 2300 RIVER PLAZA DRIVE 311 D STREET, SUITE A SACRAMENTO CA 95833 WEST SACRAMENTO CA 95605 (916) 561-5657 (916) 372-0534 [email protected] [email protected] For: CA Farm Bureau Federation For: TURN ************ SERVICE LIST *********** Last Update on 05-JUL-2001 by: SMJ R0105047 LIST

William H. Booth Judith L. Young Attorney At Law Attorney At Law LAW OFFICES OF WILLIAM H. BOOTH SEMPRA ENERGY 1500 NEWELL AVENUE, 5TH FLOOR 555 WEST FIFTH STREET, 14TH FLOOR WALNUT CREEK CA 94596 LOS ANGELES CA 90013-1011 (925) 296-2460 (213) 244-2955 [email protected] [email protected] For: CA Large Energy Consumers Assoc. Judy Peck SEMPRA ENERGY Karen Lindh 601 VAN NESS AVENUE, SUITE 2060 LINDH & ASSOCIATES SAN FRANCISCO CA 94102 7909 WALERGA ROAD, ROOM 112, PMB 119 (415) 202-9986 ANTELOPE CA 95843 [email protected] (916) 729-1562 [email protected] Keith R. Mccrea For: CA Manufactureres & Technology Association Attorney At Law SUTHERLAND, ASBILL & BRENNAN LLP 1275 PENNSYLVANIA AVENUE, NW John W. Leslie WASHINGTON DC 20004-2415 Attorney At Law (202) 383-0705 LUCE FORWARD HAMILTON & SCRIPPS, LLP [email protected] 600 WEST BROADWAY, SUITE 2600 For: California Manufacturers & Technology Assoc. SAN DIEGO CA 92101-3391 (619) 236-1414 [email protected] Fred Wesley Monier For: Shell Energy Services TURLOCK IRRIGATION DISTRICT PO BOX 949 333 EAST CANAL DRIVE Robert B. Weisenmiller TURLOCK CA 95381-0949 Ph.D. (209) 883-8321 MRW & ASSOCIATES, INC. [email protected] 1999 HARRISON STREET, STE 1440 OAKLAND CA 94612-3517 (510) 834-1999 [email protected]

Rodney Winter SAN DIEGO GAS & ELECTRIC 101 ASH STREET SAN DIEGO CA 92112-4150 (619) 696-4817 [email protected] For: Sempra Energy

Michael Bazeley SAN JOSE MERCURY NEWS 111 ELLIS STREET, 3RD FLOOR SAN FRANCISCO CA 94102 (415) 434-1018 [email protected]

Nancy Schneider 8 PRESIDIO PLACE PALM DESERT CA 92260 ************ SERVICE LIST *********** Last Update on 05-JUL-2001 by: SMJ R0105047 LIST

(760) 837-9388 [email protected]

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