Edison Bid to Shift State Contract Costs Rejected

The California Public Utilities Commission turned down Southern California Edison?s petition seeking relief from its Department of Water Resources bond charge by shifting some $1 billion of repayment obligations to San Diego Gas & Electric. Edison?s petition was rejected on a 3-2 vote May 27. The commission vote let stand its policy of requiring each utility to repay the bonds on the basis of an equal per-kilowatt-hour charge in accordance with the amount of electricity it consumes under the state contracts. Edison argued that the payment allocation method was unjust because the utility received less of the bond proceeds, and would in effect force its customers to subsidize those of other utilities. ?Unfortunately, the commission decision will force our customers to continue paying significantly more than their fair share of costs DWR incurred on their behalf during the California energy crisis,? said Gil Alexander, Edison spokesperson. Commissioners Loretta Lynch and Carl Wood backed Edison?s petition. Lynch said that while Edison received 37.8 percent of the bond proceeds, it must pay back 44.4 percent of the bonds under the allocation scheme, raising customer bills by $60 million a year. PG&E and SDG&E, on the other hand, received more of the bond proceeds than they must pay back. SDG&E argued that going along with Edison would result in a 6.1 percent rate hike in San Diego County, which already has the highest-priced electricity in the state. It would have raised the annual electricity bill for a typical grocery store by $6,000 and the bill for an average elementary school by $1,200 a year, the company said in comments submitted to the commission. CPUC president Michael Peevey opposed the petition, saying that the commission already had examined options for allocating the costs and twice settled on the existing method. ?There is no method that results in perfect equity,? he said. ?Trying to be objective and see what is fair, this clearly is not,? said Mike Florio, The Utility Reform Network senior attorney. ?On one level I can?t get overly excited as it involves only half a cent per kilowatt-hour? for customers. ?But it adds up,? he said.

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Edison Bid to Shift State Contract Costs Rejected

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