PG&E Rate Case Settlement Would Remove Customer Retention Revenue Requirement

A proposed settlement in Pacific Gas & Electric's general rate case (A. 09-12-020 et. al.) would eliminate PG&E's proposed revenue requirement for customer retention activities.

In its application, PG&E had forecast $4.0 million in 2011 expense for customer retention work. PG&E had also forecast $3.0 million in 2011 expense for economic development work.

Both of these expenses would be removed from PG&E's customer care revenue requirement under the settlement. Ratepayer-funded customer retention expenditures had been opposed by the South San Joaquin Irrigation District and Merced Irrigation District.

The settlement also requires PG&E to book customer retention costs below-the-line.

The stipulation further requires PG&E to "reasonably allocate[]" electric research development and demonstration costs between generation and distribution. The Direct Access Customer Coalition and South San Joaquin Irrigation District, among others, had requested that PG&E track generation and distribution research and development costs separately. Additionally, at the request of the Direct Access Customer Coalition, the settlement provides that, for the test year 2011 general rate case cycle, the results of PG&E's prospective electric research development and demonstration shall be placed in the public domain to the extent allowed by grid security considerations.

The settlement provides that PG&E's direct access (DA) and Community Choice Aggregation (CCA) fees should be adopted as proposed. The Direct Access Customer Coalition had supported the conditional adoption of PG&E's proposal for revised direct access fees, subject to review in a future proceeding.

PG&E commits to file an application by January 1, 2012 to comprehensively reassess all of its DA and CCA fees. The settlement also allows PG&E to cease recording costs to the Direct Access Discretionary Cost/Revenue Memorandum Account (DADCRMA), pending review of the account in the upcoming application.