The California Public Utilities Commission on January 22 approved cost-recovery schemes for natural gas pipeline capacity for which California utilities have been required to sign up. The order was a result of a Federal Energy Regulatory Commission case in which El Paso Pipeline and marketing affiliates were allegedly hogging pipeline capacity and driving up prices. The issue is now subject to a $1.5 billion settlement. Commissioner Loretta Lynch said the sign-ups have been an ?insurance policy against volatile natural gas prices, ? helping to keep the state?s gas rates lower than the rest of the nation?s. Lynch reported the gas buys totaled 370 MMcf\/day. Cost recovery for the gas acquisitions will be folded into customer rates in line with cost-allocation formulas adopted by the decision. In other meeting news, Pacific Gas & Electric shareholders were set back $38 million for higher interest rates that were a result of late Western Area Power Association payments to the Department of Water Resources. PG&E?s delinquency forced DWR to raise bond costs by $12 million, noted commissioner Geoffrey Brown. Also approved was a $2.5 billion revenue requirement forecast for Southern California Edison?s Energy Resource Recovery Account covering 2003. This mechanism tracks costs for procurement-related expenses, including administration of DWR renewables and QF contracts.