BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF ... · Application of Liberty Utilities...

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE

STATE OF CALIFORNIA

In the Matter of the Application of Southern California Edison Company (U 338-E) for Approval of Greenhouse Gas Cap-and-Trade Program Cost and Revenue Allocation.

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Application No. 13-08-002 (Filed August 1, 2013)

Application of Pacific Gas and Electric Company Setting Forth Forecast Greenhouse Gas Emissions and Compliance Costs and Allowance Revenues, and Related Administrative and Customer Outreach Costs for 2014 Pursuant to D.12-12-033 (U39M).

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Application of San Diego Gas & Electric Company (U 902 E) to Return Revenues from the Sale of Greenhouse Gas Allowances and to Recover Forecasted Costs associated with California’s Greenhouse Gas Emissions Reduction Program for 2013 and 2014.

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In the Matter of the Application of PacifiCorp (U 901 E), an Oregon Company, to Establish Forecast GHG Costs of For 2014 and to Estimate GHG Allowance Revenues to be Distributed to Eligible Customer Classes.

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Application of Liberty Utilities (CalPeco Electric) LLC (U 933 E) Setting Forth Forecast Greenhouse Gas Allowance Revenue, Greenhouse Gas Allowance Costs, Customer Outreach Costs, and Program Administrative Costs for Calendar Year 2014.

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SOUTHERN CALIFORNIA EDISON COMPANY'S (U 338-E) OPENING BRIEF

JENNIFER TSAO SHIGEKAWA REBECCA MEIERS-DE PASTINO Attorneys for SOUTHERN CALIFORNIA EDISON COMPANY

2244 Walnut Grove Avenue Post Office Box 800 Rosemead, California 91770 Telephone: (626) 302-6016 Facsimile: (626) 302-6962 E-mail: [email protected]

Dated: October 30, 2013

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BEFORE THE PUBLIC UTILITIES COMMISSION OF THE

STATE OF CALIFORNIA

In the Matter of the Application of Southern California Edison Company (U 338-E) for Approval of Greenhouse Gas Cap-and-Trade Program Cost and Revenue Allocation.

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Application of Pacific Gas and Electric Company Setting Forth Forecast Greenhouse Gas Emissions and Compliance Costs and Allowance Revenues, and Related Administrative and Customer Outreach Costs for 2014 Pursuant to D.12-12-033 (U39M).

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Application of San Diego Gas & Electric Company (U 902 E) to Return Revenues from the Sale of Greenhouse Gas Allowances and to Recover Forecasted Costs associated with California’s Greenhouse Gas Emissions Reduction Program for 2013 and 2014.

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In the Matter of the Application of PacifiCorp (U 901 E), an Oregon Company, to Establish Forecast GHG Costs of For 2014 and to Estimate GHG Allowance Revenues to be Distributed to Eligible Customer Classes.

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Application of Liberty Utilities (CalPeco Electric) LLC (U 933 E) Setting Forth Forecast Greenhouse Gas Allowance Revenue, Greenhouse Gas Allowance Costs, Customer Outreach Costs, and Program Administrative Costs for Calendar Year 2014.

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SOUTHERN CALIFORNIA EDISON COMPANY'S (U 338-E) OPENING BRIEF

Pursuant to Rule 13.11 of the California Public Utilities Commission’s (“Commission’s”)

Rules of Practice and Procedure, Southern California Edison Company (“SCE”) hereby submits

its Opening Brief in connection with its Application for Approval of Greenhouse Gas (“GHG”)

Cap-and-Trading Program Cost and Revenue Allocation (“Application”) on the issues identified

in the Assigned Commissioner and Administrative Law Judge’s Scoping Memo and Ruling,

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dated October 4, 2013 (“the Scoping Memo”). For the reasons set forth below, SCE’s

Application is reasonable and should be granted.

I.

RELEVANT BACKGROUND

On March 24, 2011, the Commission initiated Order Instituting Rulemaking (“R.”) 11-

03-012 to Address Utility Cost and Revenue Issues Associated with Greenhouse Gas Emissions.

In that rulemaking, on December 28, 2012, the Commission issued Decision (“D.”) 12-12-033

Adopting Cap-and-Trade Greenhouse Gas Allowance Revenue Allocation Methodology for the

Investor Owned Electric Utilities (“D.12-12-033” or “the GHG Decision”).

The GHG Decision (1) adopted a methodology for allocating revenue and costs

associated with the purchase and sale of California’s GHG Cap-and-Trade program allowances

to investor-owned electric utilities’ (“IOUs”) customers and (2) directed the IOUs, beginning in

2013, to file applications (“GHG Applications”) by August 1 of each year. The GHG Decision

required the GHG Applications to forecast (1) GHG cap-and-trade compliance-related costs

(“GHG costs”); (2) administrative and customer outreach costs for the subsequent year; and (3)

cap-and-trade allowance auction revenue (“allowance revenue”) to be distributed to eligible

customer classes.

The IOUs were also ordered to distribute allowance revenue, including interest, to

customers after setting aside a portion to fund administrative and outreach costs, as follows:

“A. Compensate emissions-intensive and trade-exposed entities (as defined in

this decision) using methodologies based upon those developed by the California Air

Resources Board to address direct emissions cost exposure under the Cap-and-Trade

program;

B. Offset the rate impacts of the Cap-and-Trade program in the electricity

rates of small businesses, defined as entities with monthly demand not exceeding 20

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kilowatts in more than three months in a twelve-month period, through a volumetrically

calculated rate adjustment;

C. Neutralize the rate impacts of the Cap-and-Trade program in residential

electricity rates through a volumetrically calculated rate adjustment;

D. Distribute all revenues remaining after accounting for the revenues

allocated pursuant to the prior three uses to residential customers on an equal per

residential account basis delivered as a semi-annual, on-bill credit.”1

The GHG Decision also requires the IOUs to “develop and administer a competitively

neutral customer outreach and education program on behalf of all customers receiving

greenhouse gas allowance revenue, including customers of Community Choice Aggregator and

Direct Access providers.”2 Among other requirements, the GHG Decision requires the outreach

activities be conducted through various channels, including bill notices, websites, direct

customer outreach, and various media outlets, and occur in advance of and concurrent with the

distribution of any GHG allowance revenues.3

To those ends, D.12-12-0334 required the IOUs to jointly file a GHG Revenue Allowance

Return Implementation Plan explaining how they would “apportion allowance revenue for each

of the purposes authorized in this decision…to compensate EITE, small business, and residential

customers and to fund customer education and general administrative costs incurred to

implement this decision.”5 In response, the IOUs filed a Joint Implementation Plan on February

13, 2013 (“the Original Plan”). Over the subsequent months, the IOUs worked with the Energy

Division, Commission staff, and other stakeholders to further develop the Original Plan, and

received comments from interested parties to R.11-03-012 on the Original Plan on March 11,

1 D.12-12-033, OP 1. 2 Id. at OP 11. 3 Id. 4 The January 25, 2013 Administrative Law Judge’s Ruling Confirming The Schedule For And Content Of

Utility Implementation Reports augmented the GHG Decision’s schedule for the filing. 5 D.12-12-033 at p. 152.

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2013. Thereafter, the Administrative Law Judge (“ALJ”) issued a ruling requiring the IOUs to

supplement the Original Plan with additional information.6 The IOUs submitted an Amended

Joint IOU Implementation Plan (the “Plan”) on June 19, 2013.7 The Plan incorporated the

requested information and supplied additional clarification to address previous comments

received, Commission guidance, and internal developments that occurred at the IOUs since the

Original Plan’s filing. Although not yet approved, the Commission recently issued a Proposed

Decision on the Plan.

The GHG Decision reasoned if GHG-related energy costs were immediately recoverable

in rates before the Commission finalized and implemented an allowance revenue allocation

methodology, retail customers eligible to receive allowance revenue would experience the cost

increase without any offsetting revenue.8 The Commission therefore directed the utilities to

record their authorized GHG costs in a new GHG cost sub-balancing account of the Energy

Resource Recovery Account (“ERRA”) balancing account.9 Once the allowance revenue

allocation methodology is finalized and implemented, the GHG Decision requires SCE to

amortize the outstanding balance in the ERRA subaccount, including accrued interest, over a

reasonable period so that all deferred costs are recovered within 24 months.10 In addition to the

GHG cost sub-balancing account, the GHG Decision also directed the IOUs to establish a

revenue balancing account, as well as memorandum accounts to track customer outreach and

administrative costs.11

In compliance with D.12-12-033, on August 1, 2013, SCE filed Application 13-08-002,

submitting and seeking approval of its GHG costs, the litigation and approval of which is also a

6 May 31, 2013 Administrative Law Judge’s Ruling Requiring Supplemental Filings Related to Utility Implementation Reports.

7 June 19, 2013 Amended Joint Investor-Owned Utility Cap-and-Trade Greenhouse Gas Revenue Allowance Return Implementation Plan.

8 D.12-12-033 p. 145, CL 62, OP 20. 9 Id. 10 Id. at p. 145, CL 66, OP 21. 11 Id. at OP 19, 22.

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subject of SCE’s 2013 and 2014 ERRA Forecast of Operations applications, and requesting

approval of (1) its forecast of allowance revenues and GHG-related administrative and outreach

costs, and (2) the amount, timing and methodology of allowance revenue return to SCE’s

customers. SCE also served testimony (SCE-1) supporting its Application.

On September 5, 2013, the ALJ issued a ruling consolidating SCE’s, Pacific Gas and

Electric Company’s (“PG&E’s”), San Diego Gas & Electric Company’s (“SDG&E’s”), Liberty

Utilities LLC’s, and PacifiCorp’s (collectively “the IOUs” or “the parties”) respective

applications12 and set a prehearing conference for Monday, September 23, 2013 to “(1)

determine the parties; (2) accept appearances and establish the permanent service list; (3)

identify the issues for inclusion in the scoping memo for this proceeding; (4) discuss the

schedule for this proceeding; (5) determine if there are any challenges to either the categorization

of this proceeding or to the preliminary determination that there is a need for hearings; and (6)

discuss any additional procedural matters relevant to this proceeding.”13 The Ruling also divided

the proceeding into two phases.14

Finally, the Ruling directed the IOUs to provide supplemental information in a document

titled “Appendix 1” to their respective prehearing conference statements and to address: (1) the

proposed scope of the issues the Commission will address in Phase 1 of the consolidated

proceeding, including the reasonableness of each IOU’s (a) 2013 and 2014 GHG cost and

revenue forecast, (b) 2013 and 2014 administrative and customer outreach costs forecast,

(c) amortization plan for 2013 GHG costs and revenues, (d) plan for providing climate dividends

and updating its rates, and (e) the coordination plan with other proceedings; and (2) if the

information in Appendix 1 will provide a sufficient basis for the Commission to resolve the

12 Ruling at pp. 2-3. 13 Id. at p. 3. 14 Id. at pp. 3-4.

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Phase 1 issues.15 SCE’s prehearing conference statement, filed on September 18, 2013, supported

the two phase approach to the proceeding, the proposed scope of Phase 1, and the schedule.

The Scoping Memo was issued on October 4, 2013. Among other things, the Scoping

Memo directed SCE, PG&E and SDG&E to facilitate a working group to draft Confidentiality

Protocols that meet the requirements of the California Air Resources Board (“CARB”) cap-and-

trade regulations.16 The Scoping Memo also set the schedule for the consolidated proceeding,

determined that hearings are not needed, established an ERRA coordination, update and advice

letter procedure, and outlined the issues to be addressed in both phases of this consolidated

proceeding. The Phase 1 issues, which will be addressed in this Opening Brief, are as follows:

1. Are the utilities’ forecast 2013 and 2014 cost and revenue amounts reasonable?

2. Are the utilities’ forecast 2013 and 2014 administrative and customer outreach

costs reasonable?

3. Are the utilities’ plans for amortizing 2013 costs and revenues reasonable?

4. To the extent not already addressed in R.11-03-012, are the utilities’ plans for

payment of Climate Dividends and updating of rates for 2014 reasonable?

5. Is the [] procedure for coordinating the Phase 1 decision in this proceeding (the

2014 GHG Revenue Forecast Decision) with ERRA and Energy Cost Adjustment

Clause (ECAC) account proceedings and related rate adjustments reasonable?

6. In ERRA forecast proceedings, utilities may file an updated forecast prior to the

issuance of a decision. In the event that ERRA 2013 or 2014 forecasts are

modified after issuance of the 2014 GHG Revenue Forecast Decision, should the

utilities be required to adjust their calculation of 2014 or 2013 GHG costs and

revenues, and the resulting Climate Dividend, after the issuance of the 2014 GHG

Forecast Decision? If so, what documentation or review should be required?

15 Id. at pp. 5-6. 16 Scoping Memo at pp. 7-8

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7. D.12-12-033 requires the utilities to file GHG Revenue Forecast Applications in

2013, 2014 and 2015. The applications filed in 2014 and 2015 will also include

reconciliation of forecast and actual GHG compliance costs and revenues. These

consolidated proceedings will address the 2013 GHG Revenue Applications in

Phase 1, but Phase 2 will also set forth the procedure for future GHG Revenue

Forecast Application. What steps should be taken to ensure that the applications

filed in 2014 and 2015 are efficiently and reasonably coordinated with ERRA and

ECAC proceedings?

8. What actions should be taken to coordinate the 2014 GHG Revenue Forecast

Decision with other anticipated decisions in R.11-03-012 (such as decisions on

the implementation plans, the small business revenue allocation formulae, the

emissions-intensive and trade-exposed (EITE) expansion study budget and scope,

and the EITE revenue allocation formulae), and decisions in the individual utility

applications for 2014/2015 outreach plans?17

II.

SCE’S APPLICATION IS REASONABLE AND SHOULD BE GRANTED

It should be noted from the outset that the Office of Ratepayer Advocates (“ORA”) – the

only party that filed an initial response to SCE’s Application -- recommended that the

Commission approve SCE’s (1) forecast of GHG revenue and administrative and outreach costs,

(2) amount, timing and methodology for returning revenue to customers, and (3) amortization

plan because all are reasonable.18 ORA also agreed that SCE’s forecast of GHG costs is

consistent with its 2013 and 2014 ERRA forecast applications and that evidentiary hearings on

17 Scoping Memo at pp. 4-6. 18 See ORA Response to Application (“A.”) 13-08-002 at pp. 2-6.

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SCE’s Application are not necessary.19 ORA’s October 9, 2013 Testimony reached the same

conclusions.20 Other parties to the proceeding have been similarly complimentary.21

A. SCE’s Forecast, Amortization and Recovery in Rates of GHG Costs is Reasonable

The GHG Decision requires that the amount of GHG costs reflected in eligible small

business and residential customer rates be volumetrically offset by allowance revenue, with

small business customer rate offsets subject to adjustment by an assistance factor.22

To implement this requirement, SCE utilized the same forecast of GHG costs in its

Application as in its 2013 and 2014 ERRA Applications.23 The methodology SCE utilized to

calculate those GHG costs was to use the Intercontinental Exchange (“ICE”) price as a proxy.

ICE is a commodity exchange utilized by California energy and emissions markets, and is the

primary exchange and clearing house for California GHG cap-and-trade allowances. SCE’s

forecast of the GHG price for 2014 is equal to the most recently available ICE price for a

2014-vintage GHG allowance.24 For SCE’s 2014 ERRA Forecast of Operations Application

(A.) 13-08-004, an ICE settlement price as of June 17, 2013 was used. This price is assumed

19 Id. at pp. 5-6. 20 ORA’s October 9, 2013 Testimony at 1-1 through 1-3, 2-1, 2-3 through 2-5, 4-1 through 5-1, and 6-1 through 8-

1. It should be noted, however, that ORA did not approve of SCE’s approach to its treatment of 2012 GHG cap-and-trade costs. See id. at 2-2. The Revised Proposed Decision (PD) in SCE’s 2013 ERRA Forecast of Operations A.12-08-001, which SCE fully expects to be adopted at the Commission’s October 31, 2013 meeting, makes ORA’s issue moot. To implement the intent of D.12-12-033, the Revised PD notes, at p. 8, footnote 5, that all GHG cap-and-trade related costs, beginning from the first November 2012 cap-and-trade auction, should be recorded by SCE in the GHG cost sub-account. SCE did incorporate a forecast of 2012 GHG costs from the CARB’s November 2012 auction in its 2013 GHG cost forecast in both A.12-08-001 and this Consolidated Proceeding. Because the allowances purchased in November 2012 are to be used to cover 2013 emissions, the November 2012 allowance auction costs were included in the 2013 GHG cost forecast calculation.

21 See, e.g., MEA Testimony at pp. 3-5 (approving of SCE’s amortization proposal); Large Users PHC Statement at pp. 3-4 (approving, for the most part, SCE’s presentation of information in a clear and pubic manner and recommending that all utilities should provide the data SCE provided in Table V-9 in SCE-1).

22 This assistance factor will be finalized upon issuance of the final decision Adopting GHG aAllowance Revenue Formula and Distribution Methodology for Small Business Customers and Modifying D.12-12-033.

23 The cap-and-trade allowance revenue allocated to eligible small business and residential customers on a volumetric basis to offset cap-and-trade costs is discussed in Chapter V of Exhibit SCE-1.

24 The CARB assigns a “vintage year” to each allowance. The vintage year typically represents the first year in which the allowance can be used for compliance. SCE used 2014 vintage allowance prices because that vintage most closely reflects the expected price for GHG in electricity markets in 2014.

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constant for most GHG emissions produced in 2014. No parties have objected to SCE’s

methodology. Indeed, ORA and the Large Users approved of SCE’s methodology.25

Consistent with the GHG Decision directive that SCE amortize the outstanding balance in

the ERRA sub-balancing account so that all deferred costs are recovered within 24 months,26

SCE’s Application proposes to amortize the 2013 forecast cap-and-trade costs, including accrued

interest, adopted in its 2013 ERRA forecast application over a two-year period from 2014

through 2015. Rate impacts to customers who are not eligible to receive a return of allowance

revenue will therefore be lower than they otherwise would be if SCE were to include two full

years of GHG costs in its 2014 rates. Instead of experiencing rate increases associated with both

2013 and 2014 GHG costs in 2014, generation rates for these customers will reflect 50% of 2013

GHG costs and 100% of 2014 GHG costs in 2014, and 50% of 2013 GHG costs and 100% of

2015 GHG costs in 2015.

Upon issuance of a final Commission decision in this Application, SCE proposed that it

will file an advice letter to modify SCE’s residential rate schedules and small business rate

schedules to include the volumetric $/kWh distribution rate credit to offset all or a portion of the

amount of 2014 GHG costs in generation rates for eligible customers,27 and increase all customer

groups’ generation $/kWh rates to collect the 2014 authorized GHG costs. Consistent with the

amortization methodology discussed above, these rate changes will also reflect 50 % of the

authorized 2013 GHG cost recovery and distribution of 50 % of the 2013 allowance revenue.

As ORA determined, SCE’s approach is reasonable and should be approved.

B. SCE’s Forecast of Administrative and Customer Outreach Costs is Reasonable

The GHG Decision authorized the IOUs to track administrative costs and costs related to

25 Large Users PHC Statement at pp. 3-4. 26 D.12-12-033 at OP 21. 27 In its application, SCE assumed a 100 % assistance factor for small business customers in 2013 and 2014.

Although not yet approved, the Commission recently issued a Proposed Decision modifying the 2014 assistance factor to 90% unless the CARB delays the decline of the Industry assistance factor by one compliance period..

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customer outreach and education in a memorandum account, and to pay for such efforts with

GHG allowance revenue.28 In order to ensure that adequate funding is available, the GHG

Decision directs the IOUs to set aside a portion of the GHG allowance revenue to fund

administrative activities and customer outreach before distribution of any funds to EITE, small

business, and residential customers.29 Any remaining administrative and customer outreach and

education funds at the end of a calendar year must be rolled over for use in subsequent years.”30

For 2013, SCE forecasted up-front and ongoing administrative labor costs necessary to

upgrade its billing system and internal business processes to implement the allowance revenue

allocation methodology. For 2014, SCE forecasted incremental administrative costs related to

ensuring billing accuracy.

With respect to customer outreach, the GHG Decision authorized SCE to spend up to

$1.4 million on customer outreach and education activities in 2013, excluding costs associated

with hiring a marketing and public relations firm.31 SCE filed Advice Letter 2864-E for 2013

outreach and Application (A.) 13-08-027 for 2014 through 2015 outreach. The Commission

issued final Resolution E-4611, dated October 17, 2013, rejecting SCE’s Advice Letter and

directing the utilities to re-allocate their unspent 2013 marketing funds to the California Center

for Sustainable Energy (“CCSE”). As such, SCE has not yet implemented its proposed 2013

GHG marketing, education and outreach activities nor recorded any costs in the memorandum

account.

For 2014, SCE forecasts outreach and customer education expenditures to cover

administrative costs incurred by SCE’s Customer Contact Center for handling increased call

volume and to engage in targeted and cost-sensitive GHG marketing, education and customer

outreach activities. SCE’s approach leverages existing cost-effective marketing and outreach

28 D. 12-12-033 at pp. 141-142, 149, CL 56-58, OP 16-17. 29 Id. 30 Id. Any rollover amounts will be addressed in SCE’s August 1, 2014 GHG application. 31 D.12-12-033 at OP 14.

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activities to educate customers about the cap-and-trade program and the allowance revenue

return. With respect to marketing and public relations efforts conducted by third parties in 2013,

SCE’s 2014 forecast also assumed SCE’s share of those costs. SCE proposed that such activities

would be fully funded through the already set-aside $1.4 million from the 2013 revenue, which

will remain largely remain unspent in 2013 and thus rolled over to 2014. Accordingly, SCE’s

Application did not plan to set aside additional revenue to fund GHG marketing, education and

customer outreach activities in 2014. Since then, the Commission consigned SCE’s 2013

outreach and education budget to CCSE in Resolution E-4611. SCE’s application regarding

2014-2015 outreach and education is still pending.


C. SCE Forecast, Return and Amortization of Allowance Revenue is Reasonable

SCE’s Application proposes to return allowance revenue to customers on either an annual

basis (for EITE customers), semi-annual basis (for the Climate Dividend for residential

households), or monthly basis (for the small business and residential volumetric returns for

eligible customers).

To forecast the revenue, SCE multiplies the total volume of allowances that the CARB

has allocated to SCE for the year by a forecasted price for these allowances. As with its forecast

of GHG costs, for the purpose of this consolidated proceeding, SCE relies upon the ICE price as

a proxy.

SCE proposes a 24-month amortization of its 2013 allowance revenue return over a two

year period with half distributed each year (i.e. 50% in 2014 and 50% in 2015). Although the

GHG Decision requires that EITE customers receive revenue to cover their indirect GHG costs

in the form of a yearly on-bill credit or rebate check, to minimize administrative costs, SCE

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proposed to distribute the EITE revenue return on customers’ bills.32 SCE also proposes to offset

GHG costs for eligible small business customers, exclusive of customers that have also been

flagged as EITE, with an equal amount of allowance revenue in a monthly, on-bill credit,

included as a separate line item in the delivery portion of the customer’s bill.33

All open residential customer accounts will receive a volumetric (cents / kWh) revenue

return on a monthly basis to mitigate GHG costs for the tiered usage that incorporates such costs.

For those customers, in 2014, SCE proposes to offset GHG costs with an equal amount of cap-

and-trade allowance revenue. Finally, with regard to the Climate Dividend, all residential

“households” will receive a Climate Dividend distributed as an on-bill line item twice in 2014.

The recently issued proposed decision on the GHG Joint Implementation Plan proposes that the

distributions occur in April and October.34


D. The Procedure for Updates, Tariff Changes, and Coordination with ERRA

As noted in SCE’s Application and SCE’s prehearing conference statement and

supplemental information sheet (Appendix 1), the figures provided in SCE-1 and Appendix 1

will change over time based on actual recorded activity and resulting updates to forecasts. Such

activity includes, but is not necessarily limited to, actual GHG revenue received from the August

and November 2013 auctions and updated 2014 forecast GHG costs and revenues based on

updated GHG market prices. Likewise, the outcome of final Commission decisions on the Joint

IOU Cap-and-Trade GHG Revenue Allowance Return Implementation Plan, SCE’s Outreach

32 D.12-12-033 at p. 104, OP 25. Although not yet approved, the Commission recently issued a ruling proposing the use of an outside disbursement agent to distribute the GHG revenues directly to EITE entities separate from their utility bills. See ALJ Ruling Updating Energy Division Staff Proposal on GHG Revenue Allocation Formulas and Requesting Comments, Oct. 16, 2013, at p. 1.

33 Although not yet approved, the Commission recently issued a Proposed Decision modifying the 2014 assistance factor to 90% unless the CARB delays the decline of the industry assistance factor by one compliance period. PD Adopting GHG Allowance Revenue Formula and Distribution Methodology for Small Business Customers and Modifying D.12-12-033, Oct. 10, 2013 at p. 19.

34 PD Adopting Cap-and-Trade GHG Allowance Implementation Plans, Oct. 15, 2013, at p. 13.

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Plan Application (A.13-08-027), and on the GHG Revenue Allocation Formulas may require

updates to SCE’s 2014 GHG proposed revenue returns to reflect final Commission-authorized

revenue return methodologies and formulas.

Accordingly, SCE proposed that it update the 2014 forecast of GHG costs and allowance

revenue in November in both the 2014 ERRA proceeding (GHG costs only) and in this

consolidated proceeding, based on new information that develops as the time for incorporating

costs in rates approaches. In addition, upon Commission approval of SCE’s Application, SCE

proposed that it file an advice letter updating the 2014 GHG revenue return amounts as required,

and providing all supporting spreadsheets and calculations to incorporate the most recent

recorded and/or forecast information.

The proposed advice letter will also implement any necessary changes to SCE’s tariffs.

Such changes will include revisions to SCE’s: (1) residential rate schedules, including master-

metered rate schedules, to include the authorized 2014 Climate Dividend amount, (2) residential

rate schedules, including master-metered rate schedules, and small business rate schedules to

include the volumetric $/kWh GHG credit to offset all or a portion of the amount of cap-and-

trade costs in generation rates, and (3) remaining rate schedules to include increases in all

customer groups’ generation $/kWh rates to collect authorized cap-and-trade costs.

The Scoping Memo’s proposal is virtually identical to SCE’s proposed and recommended

procedure. Accordingly, SCE finds the Scoping Memo procedure to be reasonable and supports

its adoption. Finally, SCE recommends that future GHG applications be simultaneously filed

with ERRA, as is presently the case for SCE, so that the two proceedings can be coordinated.

E. Confidentiality Working Group Proposal

The October 4, 2013 Scoping Memo directed SCE, PG&E and SDG&E to, among other

things, facilitate a working group to draft Confidentiality Protocols that meet the requirements of

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the California ARB cap-and-trade regulations.35 �Pursuant to that directive, PG&E, SCE and

SDG&E, interested parties, Commission and ARB staff participated in several Confidentiality

Protocols Working Group meetings and reached a consensus on draft Confidentiality Protocols.

The IOUs are currently working towards the development of a matrix to guide confidential

treatment of particular types of data included in the utilities’ applications. Once a draft matrix is

prepared, that draft will be presented to the larger Confidentiality Protocols Working Group for

review and comment. In light of the progress made, the ALJ McKinney vacated the Scoping

Memo’s requirement that the utilities facilitate an in-person workshop by October 25, 2013.36

Notably, one of the proposals that the Working Group members agreed upon was made

by ORA and recommended that “Southern California Edison’s (SCE’s) GHG Application should

be the model for information that can be disclosed to the public, and all utilities should provide

the data that SCE included in Table V-9 in its GHG testimony.” 37 Similarly, ORA also

recommended that “[s]imilar to the comments in the PHC Statement of the Energy Producers and

Users Coalition and the California Large Energy Consumers Association (Large Users), it is

important that the utilities publicly provide the GHG unit cost per customer class (i.e. column 5

in SCE-1 Table V-9) and the net rate impact of GHG costs and revenues per customer class.”38

ORA’s recommendation and the comments of the Large Users are another indication of the

overall reasonableness of SCE’s Application.

35 Scoping Memo at pp. 7-8 36 October 23, 2013 E-mail from ALJ McKinney, copying the service list and vacating the Scoping Memo’s in-

person October 25, 2013 workshop. 37 October 10, 2013 E-mail from Jordan Parrillo, a Regulatory Analyst in the Electricity Planning and Policy

Branch, Climate Change Initiative, for ORA, setting forth ORA’s comments on the Draft Confidentiality Protocols Working Group Session 2.

38 Id.

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III.

CONCLUSION

For the foregoing reasons, SCE’s Application is reasonable and should be granted.

Respectfully submitted, JENNIFER TSAO SHIGEKAWA REBECCA A. MEIERS-DE PASTINO

/s/ Rebecca Meiers-De Pastino By: Rebecca Meiers-De Pastino

Attorneys for SOUTHERN CALIFORNIA EDISON COMPANY

2244 Walnut Grove Avenue Post Office Box 800 Rosemead, California 91770 Telephone: (626) 302-6016 Facsimile: (626) 302-6962 E-mail: [email protected]

October 30, 2013

CERTIFICATE OF SERVICE

I hereby certify that, pursuant to the Commission’s Rules of Practice and Procedure, I have this day served a true copy of SOUTHERN CALIFORNIA EDISON COMPANY’S (U 338-E) OPENING BRIEF on all parties identified on the attached service list(s) A.13-08-002 et al. Service was effected by one or more means indicated below:

☒ Transmitting the copies via e-mail to all parties who have provided an e-mail

address.

☒ Placing the copies in sealed envelopes and causing such envelopes to be

delivered by hand or by overnight courier to the offices of the Commissioner(s) or other addressee(s).

ALJ McKinney CPUC 505 Van Ness Avenue San Francisco, CA 94102

Commissioner Peevey CPUC 505 Van Ness Avenue San Francisco, CA 94102

Jason Houck CPUC – Energy Division 505 Van Ness Ave. San Francisco, CA 94102

☐ Placing copies in properly addressed sealed envelopes and depositing such copies

in the United States mail with first-class postage prepaid to all parties for those listed on the attached non-email list.

☐ Directing Prographics to place the copies in properly addressed sealed envelopes

and to deposit such envelopes in the United States mail with first-class postage prepaid to all parties.

Executed this October 30, 2013, at Rosemead, California.

/s/ Christopher A. Stephens Christopher A. Stephens Project Analyst

SOUTHERN CALIFORNIA EDISON COMPANY

2244 Walnut Grove Avenue Post Office Box 800 Rosemead, California 91770

PROCEEDING: A1308002 - IN THE MATTER OF THE FILER: SOUTHERN CALIFORNIA EDISON COMPANY LIST NAME: LIST LAST CHANGED: OCTOBER 29, 2013

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EVELYN KAHL JEREMY WAEN ALCANTAR & KAHL REGULATORY ANALYST EMAIL ONLY MARIN ENERGY AUTHORITY EMAIL ONLY, CA 00000 EMAIL ONLY FOR: CALIFORNIA LARGE ENERGY CONSUMERS EMAIL ONLY, CA 00000 ASSOCIATION; ENERGY PRODUCERS & USERS FOR: MARIN ENERGY AUTHORITY COALITION REBECCA A. MEIERS-DE PASTINO SHIRLEY AMRANY SENIOR ATTORNEY REGULATORY CASE ADMIN. SOUTHERN CALIFORNIA EDISON COMPANY SAN DIEGO GAS & ELECTRIC COMPANY 2244 WANUT GROVE AVE. / PO BOX 800 8330 CENTURY PARK COURT, CP-32D ROSEMEAD, CA 91770 SAN DIEGO, CA 92123 FOR: SOUTHERN CALIFORNIA EDISON COMPANY FOR: SAN DIEGO GAS & ELECTRIC COMPANY ROBERT HAGA STEVEN F. GREENWALD CALIF PUBLIC UTILITIES COMMISSION ATTORNEY LEGAL DIVISION DAVIS WRIGHT TREMAINE LLP ROOM 5137 505 MONTGOMERY STREET, SUITE 800 505 VAN NESS AVENUE SAN FRANCISCO, CA 94111-6533 SAN FRANCISCO, CA 94102-3214 FOR: LIBERTY UTILITIES (CALPECO FOR: ORA (FORMERLY DRA) ELECTRIC) LLC CHRISTOPHER J. WARNER RYAN YOUNG ATTORNEY THE GREENLINING INSTITUTE PACIFIC GAS AND ELECTRIC COMPANY 1918 UNIVERSITY AVENUE, 2ND FLOOR 77 BEALE STREET B30A / PO BOX 7442 BERKELEY, CA 94704

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10/30/2013http://www.cpuc.ca.gov/service_lists/A1308002_81056.htm

SAN FRANCISCO, CA 94120 FOR: THE GREENLINING INSTITUTE FOR: PACIFIC GAS & ELECTRIC COMPANY KAREN NORENE MILLS ETTA LOCKEY ASSOC. COUNSEL ATTORNEY CALIFORNIA FARM BUREAU FEDERATION PACIFICORP 2300 RIVER PLAZA DRIVE 825 NE MULTNOMAH ST., STE. 1800 SACRAMENTO, CA 95833 PORTLAND, OR 97232 FOR: CALIFORNIA FARM BUREAU FEDERATION FOR: PACIFICORP

BARBARA BARKOVICH CASE COORDINATION BARKOVICH & YAP PACIFIC GAS AND ELECTRIC COMPANY EMAIL ONLY EMAIL ONLY EMAIL ONLY, CA 00000 EMAIL ONLY, CA 00000 ELIZABETH KELLY KATY ROSENBERG LEGAL DIRECTOR ALCANTAR & KAHL MARIN ENERGY AUTHORITY EMAIL ONLY EMAIL ONLY EMAIL ONLY, CA 00000 EMAIL ONLY, CA 00000 SHALINI SWAROOP VIDHYA PRABHAKARAN REGULATORY COUNSEL DAVIS WRIGHT & TREMAINE, LLP MARIN ENERGY AUTHORITY EMAIL ONLY EMAIL ONLY EMAIL ONLY, CA 00000 EMAIL ONLY, CA 00000 DAVIS WRIGHT TREMAINE LLP MRW & ASSOCIATES, LLC EMAIL ONLY EMAIL ONLY EMAIL ONLY, CA 00000 EMAIL ONLY, CA 00000 KAREN TERRANOVA DEANA MICHELLE NG ALCANTAR & KAHL ATTORNEY EMAIL ONLY SAN DIEGO GAS & ELECTRIC COMPANY EMAIL ON LY, CA 00000-0000 555 WEST FIFTH ST., GT-14E7 LOS ANGELES, CA 90013-1034 JOHN SHAEFFER DANIEL W. DOUGLASS LATHROP & GAGE LLP ATTORNEY 1888 CENTURY PARK EAST, STE. 1000 DOUGLASS & LIDDELL LOS ANGELES, CA 90067-1623 21700 OXNARD ST., STE. 1030 FOR: DATA CENTER COALITION WOODLAND HILLS, CA 91367 CASE ADMINISTRATION CHRISTOPHER SUMMERS SOUTHERN CALIFORNIA EDISON COMPANY REGULATORY AFFAIRS 2244 WALNUT GROVE AVENUE / PO BOX 800 SAN DIEGO GAS & ELECTRIC COMPANY ROSEMEAD, CA 91770 8330 CENTURY PARK COURT SAN DIEGO, CA 92101

Information Only



CENTRAL FILES SUE MARA SAN DIEGO GAS AND ELECTRIC CO. PRINCIPAL 8330 CENTURY PARK COURT, CP31-E RTO ADVISORS, LLC SAN DIEGO, CA 92123 164 SPRINGDALE WAY REDWOOD CITY, CA 94062 KATHLEEN E. FRASER MATTHEW GONZALES REGULATORY AFFAIRS SENIOR CASE MANAGER PACIFIC GAS & ELECTRIC COMPANY PACIFIC GAS AND ELECTRIC COMPANY 77 BEALE STREET, B9A 77 BEALE ST., RM. 918, B9A SAN FRANCISCO, CA 94105 SAN FRANCISCO, CA 94105 JAMES W. GRICE KERRY SHEA LATHROP & GAGE LLP DAVIS WRIGHT TREMAINE LLP 2345 GRAND AVE., STE. 2200 505 MONTGOMERY STREET, SUITE 800 KANSAS CITY, MO 94108-2618 SAN FRANCISCO, CA 94111 FOR: DATA CENTER COALITION FOR: LIBERTY UTILITIES (FORMERLY CALPECO, LLC) LLC CALIFORNIA ENERGY MARKETS PHILLIP MULLER 425 DIVISADERO ST STE 303 PRESIDENT SAN FRANCISCO, CA 94117-2242 SCD ENERGY SOLUTIONS 436 NOVA ALBION WAY SAN RAFAEL, CA 94903 ANDREW B. BROWN BRIAN S. BIERING ELLISON SCHNEIDER & HARRIS L.L.P. ELLISON SCHNEIDER & HARRIS, LLP 2600 CAPITOL AVENUE, STE. 400 2600 CAPITOL AVENUE, SUITE 400 SACRAMENTO, CA 95816 SACRAMENTO, CA 95816-5905 FOR: PACIFICORP. ANN TROWBRIDGE MIKE LONG ATTORNEY DIR - FINANCE & MGR DAY CARTER & MURPHY LLP LIBERTY UTILITIES 3620 AMERICAN RIVER DR., STE. 205 933 ELOISE AVE. SACRAMENTO, CA 95864 SO. LAKE TAHOE, CA 96150 MIKE CADE CATHIE ALLEN ALCANTAR & KAHL REGULATORY AFFAIRS MGR. 1300 SW 5TH AVENUE, STE. 1750 PACIFICORP PORTLAND, OR 97201 825 NE MULTNOMAH STREET, STE. 2000 PORTLAND, OR 97232

JORDAN PARRILLO CLAIRE EUSTACE CALIFORNIA PUBLIC UTILITIES COMMISSION CALIF PUBLIC UTILITIES COMMISSION ELECTRICITY PLANNING AND POLICY BRANCH ELECTRICITY PLANNING & POLICY BRANCH EMAIL ONLY ROOM 4203 EMAIL ONLY, CA 00000 505 VAN NESS AVENUE SAN FRANCISCO, CA 94102-3214

State Service



COLIN RIZZO JASON HOUCK CALIF PUBLIC UTILITIES COMMISSION CALIF PUBLIC UTILITIES COMMISSION ELECTRICITY PLANNING & POLICY BRANCH DEMAND SIDE PROGRAMS BRANCH ROOM 4102 AREA 4-A 505 VAN NESS AVENUE 505 VAN NESS AVENUE SAN FRANCISCO, CA 94102-3214 SAN FRANCISCO, CA 94102-3214 JEANNE MCKINNEY JUDITH IKLE CALIF PUBLIC UTILITIES COMMISSION CALIF PUBLIC UTILITIES COMMISSION DIVISION OF ADMINISTRATIVE LAW JUDGES PROCUREMENT STRATEGY AND OVERSIGHT BRANC ROOM 5011 ROOM 4012 505 VAN NESS AVENUE 505 VAN NESS AVENUE SAN FRANCISCO, CA 94102-3214 SAN FRANCISCO, CA 94102-3214 LUISA ELKINS CALIF PUBLIC UTILITIES COMMISSION LEGAL DIVISION ROOM 4107 505 VAN NESS AVENUE SAN FRANCISCO, CA 94102-3214

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