BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA ) ) ) ) ) ) ) )

Transcription

1 BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA Application of Southern California Edison Company (U 338-E To Establish Marginal Costs, Allocate Revenues, And Design Rates In the Matter of the Application of Southern California Edison Company (U 338-E for Authority to Make Various Electric Rate Design Changes. Application (Filed March 4, 2008 Application (Filed December 21, 2007 MOTION OF SOUTHERN CALIFORNIA EDISON COMPANY (U 338-E AND SETTLING PARTIES FOR ADOPTION OF STREET LIGHT RATE GROUP SETTLEMENT AGREEMENT BRUCE A. REED Attorney for SOUTHERN CALIFORNIA EDISON COMPANY 2244 Walnut Grove Avenue Post Office Box 800 Rosemead, California Telephone: ( Facsimile: ( Dated: January 20, 2009 # v2

2 Motion Of Southern California Edison Company (U 338-E And Settling Parties For Adoption Of Street Light Rate Group Settlement Agreement TABLE OF CONTENTS Section Title Page I. BACKGROUND...2 II. SUMMARY OF THE SETTLEMENT AGREEMENT...3 A. Street Light Facilities-Related Charges...3 B. Area Lighting Issues...5 III. REQUEST FOR ADOPTION OF THE SETTLEMENT AGREEMENT...7 A. The Settlement Is Reasonable In Light Of The Record...7 B. The Settlement Agreement Is Consistent With Law...8 C. The Settlement Agreement Is In The Public Interest...8 IV. SCHEDULE FOR COMMENTS AND IMPLEMENTATION OF SETTLEMENT AGREEMENT...9 V. CONCLUSION...10 ATTACHMENT A... STREET LIGHT RATE GROUP SETTLEMENT AGREEMENT -i-

3 BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA Application of Southern California Edison Company (U 338-E To Establish Marginal Costs, Allocate Revenues, And Design Rates In the Matter of the Application of Southern California Edison Company (U 338-E for Authority to Make Various Electric Rate Design Changes. Application (Filed March 4, 2008 Application (Filed December 21, 2007 MOTION OF SOUTHERN CALIFORNIA EDISON COMPANY (U 338-E AND SETTLING PARTIES FOR ADOPTION OF STREET LIGHT RATE GROUP SETTLEMENT AGREEMENT Pursuant to Rule 12.1 et seq of the Commission s Rule of Practice and Procedure, Southern California Edison Company (SCE, on behalf of itself and the Settling Parties, 1 requests that the Commission adopt and find reasonable the Southern California Edison Company 2009 GRC, Phase 2 Street Light Rate Group Settlement Agreement, (Phase 2 Street Light Rate Group Settlement Agreement or Settlement Agreement which is appended to this motion as Attachment A. SCE and the Settling Parties have reached a Settlement Agreement that resolves all issues related to street and area lighting rate schedules and traffic control in Phase 2 of SCE s 2009 General Rate Case (GRC. As soon as practicable following a Commission decision adopting the Settlement Agreement, but no earlier than October 1, 2009, SCE will adjust its rates for street 1 Southern California Edison Company (SCE; the California City-County Street Light Association (CAL-SLA; and Pleasant Valley Recreation and Park District (PVRPD are collectively referred to herein as the Settling Parties. -1-

4 light, area light, and traffic control customers pursuant to the terms of the Settlement Agreement. 2 Section I of this motion provides background related to this proceeding. Section II describes in general the terms of the Settlement Agreement. Section III demonstrates that the Settlement Agreement is reasonable in light of the whole record, consistent with law, and in the public interest, and that it should be adopted without modification. Section IV discusses the requests of the Settling Parties related to processing of this request and implementation of new rates. I. BACKGROUND This proceeding was initiated by the filing of SCE s application on March 4, 2008, along with SCE s direct testimony. SCE updated its initial evidentiary showing on June 27, DRA served its initial testimony on September 26, Interveners served their testimony on October 31, In accordance with the Scoping Memo and Ruling of Assigned Commissioner, dated May 14, 2008, SCE provided notice to all parties of a settlement conference to be held on November 12, Continuing discussions related to the potential settlement of issues in this proceeding occurred among the interested parties after the November 12, 2008 settlement conference. Given progress made toward settlement, rebuttal testimony was deferred pursuant to rulings by Administrative Law Judge (ALJ Yip-Kikugawa. SCE and the Settling Parties executed this Settlement Agreement on or after January 8, The Settling Parties represent street lighting, area lighting, and traffic control customer interests. SCE, CAL-SLA, and PVRPD served prepared direct testimony that addressed the 2 This Settlement Agreement also assumes Commission approval of the Phase 2 Revenue Allocation Settlement Agreement, filed January 9, 2009, which is intended to establish the allocation of SCE s revenue requirement among the customer groups, and includes a provision that addresses the capping of facilities charges for street light rate schedules. -2-

5 issues resolved by this Settlement Agreement. The proposals made by the CAL-SLA and PVRPD would have resulted in a wide range of outcomes relative to SCE s litigation position. II. SUMMARY OF THE SETTLEMENT AGREEMENT The primary provisions of the Settlement Agreement are summarized below. A. Street Light Facilities-Related Charges In its prepared testimony, SCE asserted that street light rate levels were well below cost but proposed to limit the increase to street light facilities charges (which are based on Non- Allocated Revenues 3 directly assigned to the street light rate group to 20 percent in In the GRC attrition years (2010 and 2011, SCE proposed to adjust the facilities charges by the attrition year distribution rate adjustment applied to all other rate groups. Applying this treatment to the streetlight Non-Allocated Revenues, according to SCE, would help reduce the difference between full marginal cost based rates and the current subsidized rate levels. In limiting the increase to facilities charges, SCE proposed that the revenue deficiency should be allocated to all rate groups, including the street light rate group. CAL-SLA disagreed with SCE s marginal cost of service and the proposed annual increases to facilities charges, stating that facilities charges should not increase at all in the GRC attrition years 2010 and CAL-SLA asserted that SCE s costs increases for 2004 through 2007 were much greater than the increases shown for comparable street light installations in the Handy-Whitman Index of Public Utility Construction Costs, which is a nationally recognized index of cost trends in electric utility construction. CAL-SLA also disagreed with the rental charges, discount rate, and escalation rate SCE used as a basis for establishing facilities-related 3 Capitalized terms are defined in the Settlement Agreement in Paragraph

6 charges. 4 CAL-SLA stated that costs for Edison SmartConnect should not be allocated to the street light rate group. This Settlement Agreement resolves the contested issues related to SCE s recovery of Non-Allocated Revenues via street light facilities charges, i.e. Non-Energy Charges. It provides the means of establishing facilities charges effective October 1, 2009, as well as for GRC attrition years in 2010 and 2011, and for the implementation of rates for Phase 1 of SCE s 2012 GRC. The Settlement Agreement establishes a targeted annual percentage increase of 4.8 percent (based on the average Handy-Whitman 5 escalation rate for mast arms and luminaries installed for the period to Non-Energy Charges for schedules LS-1, LS-2, LS-3, DWL, and OL-1. This target annual percentage increase shall be used to calculate Target Lamp Charges for each street light rate schedule in 2009, 2010, 2011, and The Target Lamp Charges will serve as a cap on calculated Non-Energy Charges if the charges in effect prior to GRC rate changes are less than the Target Lamp Charges, and the Settlement Agreement prevents any further increase to Non-Energy Charges if such charges already exceed the Target Lamp Charges. The Settlement Agreement provides that any revenue deficiency associated with the establishment of Non-Energy Charges for Street Light Rate Group rate schedules in accordance with this Agreement shall be recovered from all rate groups, with the deficiency allocated on the basis of distribution related revenues. 7 This provision has also been accepted by settling parties in the Phase 2 Revenue Allocation Settlement Agreement. In addition, the Settlement Agreement provides that SCE and CAL-SLA shall work together on a joint study prior to SCE s next GRC to better understand the costs to construct, 4 CAL-SLA and SCE have both joined in a marginal cost/revenue allocation Settlement Agreement that resolves all issues raised by CAL-SLA with respect to marginal costs and revenue allocation. 5 The Handy-Whitman Index of Public Utility Construction Costs, Cost Trends of Electric Utility Construction, Pacific Region compiled and published by Whitman, Requardt & Associates, LLP 6 Settlement Agreement, Paragraphs 4.e and 4.f. 7 Settlement Agreement, Paragraph 4.g. -4-

7 install, own, and maintain street light facilities and to identify the sources of revenues that pay for the recovery of these costs. 8 The Settlement Agreement also resolves issues related to the establishment of Customer Charges and traffic control rates. Because SCE and CAL-SLA are parties to the Phase 2 Revenue Allocation Settlement Agreement, filed January 9, 2009, other contested issues raised by CAL-SLA in its testimony regarding allocation of Edison SmartConnect costs, caps on revenue allocation and increases to rates have also been resolved. B. Area Lighting Issues SCE s existing area lighting rate schedules generally restrict electric usage to outdoor lighting nighttime hours (dusk to dawn and allow up to 15 percent incidental, nonlighting usage but such incidental usage must also occur during the dusk to dawn time period. Schedule AL-2 is applicable to outdoor area lighting loads other than street lights that are restricted in usage from dusk to dawn. As a result, many parks whose primary electric usage is at night, but have some incidental daytime usage must take service on rate schedules such as SCE s GS-1 or GS-2, depending on the level of their demand. Some customers such as parks with demands greater than 20 kw have low load factors because nearly all of their usage is restricted to nighttime hours and therefore pay significantly higher bills on Schedules GS-2 than other customers in these rate groups due of the nature of their electric usage and resulting demand charges, even though nearly all of the usage occurs during off-peak hours. Pleasant Valley Recreation and Parks District (PVRPD acknowledged that it could obtain the more favorable AL-2 rate for community parks it operates, but only if PVRPD eliminated incidental daytime usage for such equipment as hand dryers, soda machines, and others. PVRPD contends that customers such as PVRPD should have other choices and proposed that SCE modify the eligibility provisions of Schedule GS-1, which has no demand 8 Settlement Agreement, Paragraph 4.k. -5-

8 charge, to allow customers with demands greater than 20 kw to take service on that tariff. PVRPD estimates that if low-load factor customers currently served on Schedule GS-2 could switch to Schedule GS-1, they could save approximately $0.15 per kwh, resulting in an annual revenue reduction of $31 million. As another alternative, PVRPD proposed that SCE should reinstate Schedule AL-1, which allowed up to 15 percent of the customer s load to be uncontrolled, and not limited to dusk to dawn hours. PVRPD estimates that with this option, fewer accounts would be eligible and the revenue deficiency would be less than $375,000. The Settlement Agreement resolves the issues raised by PVRPD as follows: Schedule AL-2 shall be modified to include two options. Outdoor area lighting customers without daytime incidental loads shall receive service on Schedule AL-2, Option A. Schedule AL-2, Option A, shall retain the same limits on incidental load and rate structure as in SCE s existing Schedule AL-2. 9 Option B, shall allow incidental load up to 15 percent of the maximum monthly peak demand, whether such incidental load occurs in the daytime or nighttime, provided that daytime incidental load shall not exceed 20 kw. Schedule AL-2, Option B, shall also require a meter capable of providing interval metering data, which shall be provided by SCE, subject to meter availability, with no incremental meter charges. 10 Option B, shall consist of on-peak and offpeak energy charges as well as a customer charge. The on-peak energy charge shall be equal to the Schedule GS-1 seasonal energy charge and shall apply year-round during the hours of 8:00 am to 4:00 pm on weekdays, weekends, and holidays. The off-peak energy charge for Schedule AL-2, Option B, shall be the same as the energy charge for Schedule AL-2, Option A. The customer charge for Schedule AL-2, Option B, shall be the same as the customer charge for Schedule AL-2, Option A Settlement Agreement, Paragraph 4.l. 10 Settlement Agreement, Paragraph 4.m. 11 Settlement Agreement, Paragraph 4.n. -6-

9 III. REQUEST FOR ADOPTION OF THE SETTLEMENT AGREEMENT This Settlement Agreement is submitted pursuant to Rule 12.1 et seq of the Commission s Rules of Practice and Procedure (Rules. The Settlement Agreement is consistent with Commission decisions on settlements which express the strong public policy favoring settlement of disputes if they are fair and reasonable in light of the whole record. 12 This policy supports many worthwhile goals, including reducing the expense of litigation, conserving scarce Commission resources, and allowing parties to reduce the risk that litigation will produce unacceptable results. 13 As long as a settlement taken as a whole is reasonable in light of the record, consistent with the law, and in the public interest it should be adopted without change. This Settlement Agreement complies with Commission guidelines and relevant precedent for settlements. The general criteria for Commission approval of settlements are stated in Rule 12.1(d as follows: The Commission will not approve stipulations or settlements, whether contested or uncontested, unless the stipulation or settlement is reasonable in light of the whole record, consistent with law, and in the public interest. 14 The Settlement Agreement meets the criteria for a settlement pursuant to Rule 12.1(d, as discussed below. A. The Settlement Is Reasonable In Light Of The Record The prepared testimony, the Settlement Agreement itself, and this motion contain the information necessary for the Commission to find the Settlement Agreement reasonable in light of the record. Prior to the settlement, parties conducted discovery, and served testimony on the 12 See, e.g., D (30 CPUC 2d 189, and D (40 CPUC 2d, 301, D , 46 CPUC 2d 538, See also, Re San Diego Gas & Electric Company, (D , 37 CPUC 2d 360: [S]ettlements brought to this Commission for review are not simply the resolution of private disputes, such as those that may be taken to a civil court. The public interest and the interest of ratepayers must also be taken into account and the Commission s duty is to protect those interests. -7-

10 issues related to rate design for the Street Light Rate Group. The prepared testimony and related exhibits should be made part of the Commission s record of this proceeding. The Settlement Agreement represents a reasonable compromise of the parties positions. The prepared testimony of the parties, comprising the record for this proceeding, contains sufficient information for the Commission to judge the reasonableness of the Settlement Agreement. B. The Settlement Agreement Is Consistent With Law The Settling Parties believe that the terms of the Settlement Agreement comply with all applicable statutes and prior Commission decisions, and reasonable interpretations thereof. In agreeing to the terms of the Settlement Agreement, the Settling Parties have explicitly considered the relevant statutes and Commission decisions and believe that the Commission can approve the Settlement Agreement without violating applicable statutes or prior Commission decisions. C. The Settlement Agreement Is In The Public Interest The Settlement Agreement is a reasonable compromise of the Settling Parties respective positions. The Settlement Agreement is in the public interest and in the interest of SCE s customers. It fairly resolves issues and provides more certainty to street light customers regarding their present and future costs, which is in the public interest. The Settlement Agreement, if adopted by the Commission, avoids the cost of further litigation, and frees up Commission resources for other proceedings. Given that the Commission s workload is extensive, the impact on Commission resources is doubly important. The Settlement Agreement frees up the time and resources of other parties as well, so that they may focus on other proceedings. The prepared testimony and evidentiary record contain sufficient information for the Commission to judge the reasonableness of the Settlement Agreement and for it to discharge any future regulatory obligations with respect to this matter. Each portion of the Settlement Agreement is dependent upon the other portions of the Settlement Agreement. Changes to one portion of the Settlement Agreement would alter the -8-

11 balance of interests and the mutually agreed upon compromises and outcomes which are contained in the Settlement. As such, the Settling Parties request that it be adopted as a whole by the Commission, as it is reasonable in light of the whole record, consistent with law, and in the public interest. IV. SCHEDULE FOR COMMENTS AND IMPLEMENTATION OF SETTLEMENT AGREEMENT The Settling Parties seek approval of the terms of the Settlement Agreement so that SCE may implement rates as soon as practicable following the issuance of a final Commission decision approving the Settlement Agreement but no earlier than October 1, In order to accomplish this while minimizing changes to the adopted schedule for this proceeding, the Settling Parties seek reductions in the time periods provided by Rule 12.2 for comments and replies to comments on the Settlement Agreement. 15 This reduction will not prejudice other parties given that the only active parties who have addressed the issues encompassed by this Settlement Agreement are SCE, CAL-SLA, and PVRPD. In order to accommodate questions about the Settlement Agreement in the event there are any material contested issues of fact following the filing of comments, the Settling Parties request that one day be scheduled for a hearing, (with a panel of sponsoring witnesses and that the Assigned Commissioner or Administrative Law Judge approve the following proposed schedule: 15 In accordance with the January 9, 2009 ruling of ALJ Yip-Kikugawa, the comment periods related to the proposed Phase 2 Revenue Allocation Settlement Agreement were reduced and established as January 23, 2009 for opening comments and January 30, 2009 for reply comments. The ruling also established February 9 and February 10 as dates for hearings on the Phase 2 Revenue Allocation Settlement Agreement. -9-

12 Event Date Motion filed for Adoption of Settlement Agreement January 20, 2009 Opening comments, if any, on Settlement Agreement(s January 23, 2009 Reply comments on Settlement Agreement(s January 30, 2009 Hearing on Settlement Agreements, if necessary February 9-10, 2009 Opening briefs (consolidated for all Phase 2 issues February 20, 2009 Reply briefs (consolidated for all Phase 2 issues March 6, 2009 V. CONCLUSION WHEREFORE, the Settling Parties respectfully request that the Assigned Commissioner, Assigned ALJ, and the Commission: 1. Shorten the period allowed for comments and replies on the Settlement Agreement; 2. Adopt the attached Settlement Agreement as reasonable in light of the record, consistent with law, and in the public interest; and 3. Authorize SCE to implement changes in rates and tariffs in accordance with the terms of the Settlement Agreement. -10-

13 Respectfully submitted, BRUCE A. REED By: /s/ Bruce A. Reed Bruce A. Reed Attorneys for SOUTHERN CALIFORNIA EDISON COMPANY 2244 Walnut Grove Avenue Post Office Box 800 Rosemead, California Telephone: ( Facsimile: ( January 20,

14 Attachment A STREET LIGHT RATE GROUP SETTLEMENT AGREEMENT

15 BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA Application of Southern California Edison Company (U 338-E To Establish Marginal Costs, Allocate Revenues, And Design Rates In the Matter of the Application of Southern California Edison Company (U 338-E for Authority to Make Various Electric Rate Design Changes. Application (Filed March 4, 2008 Application (Filed December 21, 2007 SOUTHERN CALIFORNIA EDISON COMPANY 2009 GRC, PHASE 2 STREET LIGHT RATE GROUP SETTLEMENT AGREEMENT Dated: January 5, 2009 # v11

16 Phase 2 Street Light Rate Group Settlement Agreement Paragraph Title Page 1. Parties Recitals Definitions Agreement Implementation of Agreement Incorporation of Complete Agreement Signature Date Regulatory Approval Compromise Of Disputed Claims Non Precedent Previous Communications Non Waiver Effect Of Subject Headings Governing Law Number Of Originals...10 ATTACHMENT A... ILLUSTRATIVE CHANGES TO NON-ENERGY CHARGES ( i -

17 SOUTHERN CALIFORNIA EDISON COMPANY 2009 GRC, PHASE 2 STREET LIGHT RATE GROUP SETTLEMENT AGREEMENT This Phase 2 Street Light Rate Group Settlement Agreement (Agreement or Settlement Agreement is entered into by and among the undersigned Parties hereto, with reference to the following: 1. Parties The Parties to this Agreement are Southern California Edison Company (SCE, California City-County Street Light Association (CAL-SLA, and Pleasant Valley Recreation and Park District (PVRPD (referred to hereinafter collectively as Parties or Settling Parties or individually as Party. a. SCE is an investor-owned public utility and is subject to the jurisdiction of the California Public Utilities Commission (Commission or CPUC with respect to providing electric service to its CPUC-jurisdictional retail customers. b. CAL-SLA represents cities and counties that take street and area lighting and traffic signal services from SCE and the other two major investor-owned utilities, Pacific Gas & Electric Company and San Diego Gas & Electric Company. c. PVRPD is a recreation and park district, which was formed in 1962 under the California Public Resources Code. PVRPD owns and operates 27 public parks in or around Camarillo, California. Electricity service to these parks consists primarily of outdoor lighting and is provided by SCE. The outdoor lighting accounts are characterized by relatively high maximum demand and low load factors and are currently served on SCE s Schedule GS-2 because the accounts have some incidental load that cannot be limited to the dusk to dawn requirement of Schedule AL

18 2. Recitals a. In Phase 2 of SCE s 2009 General Rate Case, the Commission allocates SCE s authorized revenue requirement among rate groups and authorizes rate design changes for rate schedules in each rate group. b. On March 4, 2008, SCE served its initial prepared testimony regarding marginal costs, revenue allocation and rate design in Application SCE updated its initial showing on June 27, c. In accordance with the Scoping Memo and Ruling of Assigned Commissioner, dated May 14, 2008, SCE provided notice to all parties of its intent to conduct a settlement conference related to potential issues and an initial settlement conference was held on November 12, d. DRA served its initial testimony on September 26, Interveners, including CAL-SLA and PVRPD served their initial testimony on October 31, e. Continuing settlement discussions occurred among the interested parties after November 12, f. The Parties have evaluated the impacts of the various proposals in this consolidated proceeding for A and A and desire to resolve all issues related to rate design for the Street Light Rate Group as indicated in Paragraph 4 of this Agreement. 3. Definitions When used in initial capitalization in this agreement, whether in singular or plural, the following terms shall have the following meanings: a. Agreement shall have the meaning given to such term in the introductory paragraph hereof. b. Settling Parties means SCE, CAL-SLA, and PVRPD

19 c. Energy Charges mean the dollar per kilowatt-hour (kwh charges applicable to street and area lighting rate schedules. Energy Charges recover SCE s costs for delivery service and generation. d. Customer Charges mean the dollar per month charges applicable to certain Street Light Rate Group and traffic control rate schedules. e. Non-Energy Charges mean the distribution charges applicable to street and area lighting facilities owned and maintained by SCE. Non-Energy Charges are expressed as dollars per lamp per month. Non-Energy Charges are synonymous with facilities charges, service charges, and other charges applicable to street and area lighting. f. Street Light Rate Group means the following SCE rate schedules: Schedule LS-1 Lighting Street and Highway Company-Owned System, Schedule LS-2 Lighting Street and Highway Customer-Owned Installation Unmetered Service, Schedule LS-3, Lighting Street and Highway Customer-Owned Installation Metered Service, Schedule OL-1 Outdoor Area Lighting Service, Schedule DWL Residential Walkway Lighting, and Schedule AL-2 Outdoor Area Lighting Service Metered. g. Target Lamp Charges mean Non-Energy Charges that shall be established as provided in Paragraph 4.c of this Agreement for the period from October 1, 2009 through rate changes implemented as a result of Phase 2 of SCE s 2012 general rate case (GRC. h. Allocated Revenues mean the amount of SCE s revenue requirement allocated to the Street Light Rate Group. Allocated Revenues are used to establish the Energy Charges applicable to the Street Light Rate Group. i. Non-Allocated Revenues mean the revenues collected from Non-Energy Charges. These costs are assigned directly to the Street Light Rate Group and are excluded from SCE s allocation of the revenue requirement to all rate groups. Non-Allocated Revenues for 2009, 2010, 2011, and

20 shall be based on Non-Energy Charges calculated according to Paragraph 4 in this Agreement. j. Functional SAPC Allocation means allocation of SCE s revenue requirement to each of SCE s rate groups based on the system average percentage change for the particular function, i.e., distribution or generation. k. Commission or CPUC means the California Public Utilities Commission. 4. Agreement In consideration of the mutual obligations, covenants and conditions contained herein, the Settling Parties agree to the terms of this Agreement. Nothing in this Paragraph 4 of this Agreement shall be deemed to constitute an admission or an acceptance by any Party of any fact, principle, or position contained herein. This Agreement is subject to the express limitation on precedent described in Paragraph 10. The Parties, by signing this Agreement, acknowledge that they pledge support for Commission approval and subsequent implementation of all the provisions of the Agreement. a. The current rate structure, consisting of Customer Charges, Energy Charges and Non-Energy Charges shall be maintained for all applicable Street Light Rate Group and traffic control rate schedules. b. Effective October 1, 2009, the following Customer Charges shall be applicable: for traffic control (Schedule TC-1, $14.75 per month per meter, for metered street lights with multiple service (Schedule LS-3, $13.00 per month per meter, and for metered street lights with series service (Schedule LS-3, $ per month per meter. c. Non-Energy Charges shall change only according to the provisions set forth in Paragraph 4 of this Agreement and only by SCE advice letters filed in compliance with the provisions of Paragraph 4 of this Agreement

21 Illustrative changes to Non-Energy Charges calculated in accordance with these provisions are provided in Attachment A to this Agreement. d. In order to achieve a greater degree of control over future increases to the Non-Energy Charges, a targeted annual percentage increase of 4.8 percent (based on the average Handy-Whitman 1 escalation rate for mast arms and luminaries installed for the period to Non-Energy Charges shall be established for schedules LS-1, LS-2, LS-3, DWL, and OL-1. This target annual percentage increase shall be used to calculate Target Lamp Charges for each Streetlight rate schedule in 2009, 2010, 2011, and The Target Lamp Charges for 2009 shall equal the December 2008 Non-Energy Charges increased by 4.8 percent. For each year thereafter from 2010 until rate changes are implemented as a result of Phase 2 of SCE s 2012 GRC, the Target Lamp Charges shall equal the product of the Target Lamp Charges for the prior year increased by 4.8 percent. e. Non-Energy Charges for 2009 that are implemented in accordance with Decision (D and the settlement agreement adopted in Phase 2 of SCE s 2006 GRC (Application will be in effect prior to October 1, Those Non-Energy Charges are expected to exceed the Target Lamp Charges for If so, there will be no increase to Non- Energy Charges when rate changes related to Phase 2 of SCE s 2009 GRC are first implemented on or after October 1, If Non-Energy Charges in effect prior to October 1, 2009 do not exceed the Target Lamp Charges for 2009, SCE shall increase such Non-Energy Charges to the Target Lamp Charges for 2009 when rate changes related to Phase 2 of SCE s 2009 GRC are first implemented on or after October 1, f. This Agreement shall apply to increase Non-Energy Charges when attrition revenue changes authorized by the Commission in Phase 1 of SCE s 2009 GRC are implemented in 2010 and 2011, and when the 1 The Handy-Whitman Index of Public Utility Construction Costs, Cost Trends of Electric Utility Construction, Pacific Region compiled and published by Whitman, Requardt & Associates, LLP - 5 -

22 revenue change for Phase 1 of SCE s 2012 GRC is implemented, subject to the following conditions: 1. Non-Energy Charges for 2010 (adjusted for the 2009 GRC attrition year 2010 revenue increase shall increase based on the functional System Average Percentage Change (SAPC if the actual Non- Energy Charge in effect prior to January 1, 2010 is less than the Target Lamp Charge for 2010 provided that the Non-Energy Charge for 2010 shall not exceed the Target Lamp Charge for If however, the actual Non-Energy Charge in effect prior to January 1, 2010 exceeds the Target Lamp Charge for 2010, the Non-Energy Charge for 2010 shall not change. 2. Non-Energy Charges for 2011 (adjusted for the 2009 GRC attrition year 2011 revenue increase shall increase based on the functional SAPC if the actual Non-Energy Charge in effect prior to January 1, 2011 is less than the Target Lamp Charge for 2011 provided that the Non-Energy Charge for 2011 shall not exceed the Target Lamp Charge for If however, the actual Non-Energy Charge in effect prior to January 1, 2011 exceeds the Target Lamp Charge for 2011, the Non-Energy Charge for 2011 shall not change. 3. When the revenue requirement change for SCE s 2012 GRC is implemented, Non-Energy Charges for 2012 shall increase based on the functional SAPC if the actual Non-Energy Charge in effect prior to January 1, 2012 is less than the Target Lamp Charge for 2012 provided that the Non-Energy Charge for 2012 shall not exceed the Target Lamp Charge for If however, the actual Non-Energy Charge in effect prior to January 1, 2012 exceeds the Target Lamp Charge for 2012, the Non-Energy Charge for 2012 shall not change. g. Any revenue deficiency associated with the establishment of Non-Energy Charges for Street Light Rate Group rate schedules in accordance with Paragraphs 4.e and 4.f of this Agreement shall be recovered from all rate - 6 -

23 groups, with the deficiency allocated on the basis of distribution related revenues. This provision is subject to the filing in this proceeding and CPUC approval of a separate revenue allocation settlement agreement which also adopts the substance of this paragraph. h. Changes to Allocated Revenues collected by Energy Charges and Customer Charges for the Street Light Rate Group and traffic control schedules shall be implemented on a Functional SAPC basis whenever changes to SCE s authorized revenues are implemented. i. Distribution-related revenue allocations will not include streetlight facilities-related costs (i.e., Non-Allocated Revenues in determining the Street Light Rate Group s revenue responsibility. j. Effective January 1, 2010, the costs for a Standard Installation defined in Special Condition 2 of Schedule LS-1 and used to establish a Differential Facilities rate, pursuant to Special Condition 11 of Schedule LS-1, shall equal the December 2009 Standard Installation costs increased by 4.8 percent. For each year thereafter until rate changes are implemented as a result of Phase 2 of SCE s 2012 GRC, the Standard Installation cost shall equal the product of the Standard Installation cost for the prior year increased by 4.8 percent. k. SCE and CAL-SLA shall work together on a joint study prior to SCE s next GRC to better understand the costs to construct, install, own, and maintain street light facilities and to identify the sources of revenues that pay for the recovery of these costs. l. Schedule AL-2 shall be modified to include two options: Option A and Option B. Outdoor area lighting customers without daytime incidental loads shall receive service on Schedule AL-2, Option A. Schedule AL-2, Option A, shall retain the same limits on incidental load and rate structure as in SCE s existing Schedule AL-2. m. Schedule AL-2, Option B, shall allow incidental load up to 15 percent of the maximum monthly peak demand, whether such incidental load occurs in the daytime or nighttime, provided that daytime incidental load shall not - 7 -

24 exceed 20 kilowatts (kw. Schedule AL-2, Option B, shall also require a meter capable of providing interval metering data, which shall be provided by SCE, subject to meter availability, with no incremental meter charges. n. Schedule AL-2, Option B, shall consist of on-peak and off-peak energy charges as well as a customer charge. The on-peak energy charge shall be equal to the Schedule GS-1 seasonal energy charge and shall apply yearround during the hours of 8:00 am to 4:00 pm on weekdays, weekends, and holidays. The off-peak energy charge for Schedule AL-2, Option B, shall be the same as the energy charge for Schedule AL-2, Option A. The customer charge for Schedule AL-2, Option B, shall be the same as the customer charge for Schedule AL-2, Option A. o. Customers with outdoor area lighting service shall be removed from service on either Option A or Option B of Schedule AL-2 if the applicable incidental load limits are exceeded during any three months in a twelve-month period. 5. Implementation of Agreement It is the intent of the parties that SCE should be authorized to implement the rates resulting from this Agreement as soon as practicable following the issuance of a final Commission decision approving this Agreement but no earlier than October 1, Incorporation of Complete Agreement This Agreement is to be treated as a complete package and not as a collection of separate agreements on discrete issues. To accommodate the interests related to diverse issues, the Parties acknowledge that changes, concessions, or compromises by a Party or Parties in one section of this Agreement resulted in changes, concessions, or compromises by the Parties in other sections. Consequently, the Parties agree to oppose any modification of this Agreement not agreed to by all Parties

25 7. Signature Date This Agreement shall become binding as of the last signature date of the Settling Parties. 8. Regulatory Approval The Parties shall use their best efforts to obtain Commission approval of the Agreement. The Parties shall jointly request that the Commission: (1 approve the Agreement without change; and (2 find the Agreement to be reasonable, consistent with law and in the public interest. 9. Compromise Of Disputed Claims This Agreement represents a compromise of disputed claims between the Parties. The Parties have reached this Agreement after taking into account the possibility that each Party may or may not prevail on any given issue. The Parties assert that this Agreement is reasonable, consistent with law and in the public interest. 10. Non Precedent Consistent with Rule 12.5 of the Commission s Rules of Practice and Procedure, this Agreement is not precedential in any other proceeding before this Commission, except as expressly provided in this Agreement or unless the Commission expressly provides otherwise. 11. Previous Communications The Agreement contains the entire agreement and understanding between the Parties as to the subject matter of this Agreement, and supersedes all prior agreements, commitments, representation, and discussions between the Parties. 12. Non Waiver None of the provisions of this Agreement shall be considered waived by any Party unless such waiver is given in writing. The failure of a Party to insist in any one or more instances upon strict performance of any of the provisions of this - 9 -

26 Agreement or to take advantage of any of their rights hereunder shall not be construed as a waiver of any such provisions or the relinquishment of any such rights for the future, but the same shall continue and remain in full force and effect. 13. Effect Of Subject Headings Subject headings in this Agreement are inserted for convenience only, and shall not be construed as interpretations of the text. 14. Governing Law This Agreement shall be interpreted, governed and construed under the laws of the State of California, including Commission decisions, orders and rulings, as if executed and to be performed wholly within the State of California. 15. Number Of Originals This Agreement is executed in counterparts, each of which shall be deemed an original. The undersigned represent that they are authorized to sign on behalf of the Party represented. SOUTHERN CALIFORNIA EDISON COMPANY By: /s/ Bruce A. Reed Title: Senior Attorney Date: 1/19/

27 CALIFORNIA CITY-COUNTY STREET LIGHT ASSOCIATION By: /s/ Reed V. Schmidt Title: Energy Consultant Date: 1/8/2009 PLEASANT VALLEY RECREATION AND PARK DISTRICT By: /s/ Mark Carlson Title: Financial Supervisor Date: 1/8/

28 Attachment A Illustrative Changes to Non-Energy Charges (

29 Illustrative Changes to Non-Energy Charges ( Pursuant to Paragraph 4 of Settlement Agreement Example: 100-watt HPSV, Schedule LS-1 Target Lamp Assumed Calculated Charge ( SAPC % SAPC Non- Actual Non- Year 1-Dec Increase Energy Charge Energy Charge $ Jan % $8.43 $ Mar-2009 $ % $9.12 $ Oct % $9.12 $ Jan-2010 $ % $9.58 $ Jan-2011 $ % $9.48 $ Jan-2012 $ % $9.95 $9.84 Settlement effective on October 1, 2009

30 CPUC - Service Lists - A Page 1 of 5 1/20/2009 CPUC Home CALIFORNIA PUBLIC UTILITIES COMMISSION Service Lists PROCEEDING: A EDISON - TO ESTABLIS FILER: SOUTHERN CALIFORNIA EDISON COMPANY LIST NAME: LIST LAST CHANGED: JANUARY 15, 2009 DOWNLOAD THE COMMA-DELIMITED FILE ABOUT COMMA-DELIMITED FILES Back to Service Lists Index Parties KEITH MCCREA RANDALL W. KEEN SUTHERLAND ASHILL & BRENNAN MANATT PHELPS & PHILLIPS, LLP 1275 PENNSYLVANIA AVENUE NW WEST OLYMPIC BLVD. WASHINGTON, DC LOS ANGELES, CA FOR: CA MANUFACTURERS & TECHNOLOGY FOR: LOS ANGELES COUNTY S. NANCY WHANG GREGORY S.G. KLATT DOUGLASS & LIDDELL MANATT, PHELPS & PHILLIPS, LLP 411 E. HUNTINGTON DRIVE NO WEST OLYMPIC BLVD. ARCADIA, CA LOS ANGELES, CA FOR: ALLIANCE FOR RETAIL ENERGY MARKETS FOR: LOS ANGELES UNIFIED SCHOOL MARICRUZ PRADO R. OLIVIA SAMAD SOUTHERN CALIFORNIA EDISON COMPANY SOUTHERN CALIFORNIA EDISON 2244 WALNUT GROVE AVENUE PO BOX 800, 2244 WALNUT GROVE AVENUE PO BOX 800 ROSEMEAD, CA ROSEMEAD, CA FOR: SOUTHERN CALIFORNIA EDISON COMPANY FOR: SOUTHERN CALIFORNIA EDISON COMPANY DONALD C. LIDDELL KENDALL H. MACVEY, ESQ. BEST, BEST & KRIEGER, LLP DOUGLASS & LIDDELL 3750 UNIVERSITY AVENUE, SUITE ND AVENUE RIVERSIDE, CA SAN DIEGO, CA FOR: WESTERN RIVERSIDE COUNCIL OF FOR: DEBENHAM ENERGY, LLC / ICE ENERGY, GOVERNMENTS INC. DOUGLAS A. AMES NORA SHERIFF

31 CPUC - Service Lists - A Page 2 of 5 1/20/2009 TRANSPHASE SYSTEMS, INC. ALCANTAR & KAHL, LLP 4971 LOS PATOS AVENUE 33 NEW MONTGOMERY STREET, SUITE 1850 HUNTINGTON BEACH, CA SAN FRANCISCO, CA FOR: TRANSPHASE CO. FOR: ENERGY PRODUCERS AND USERS COALITION HAYLEY GOODSON PAUL ANGELOPULO CALIF PUBLIC UTILITIES COMMISSION THE UTILITY REFORM NETWORK LEGAL DIVISION 711 VAN NESS AVENUE, SUITE 350 ROOM 4107 SAN FRANCISCO, CA VAN NESS AVENUE FOR: THE UTILITY REFORM NETWORK SAN FRANCISCO, CA FOR: DRA NORMAN J. FURUTA ANDREW L. NIVEN FEDERAL EXECUTIVE AGENCIES PACIFIC GAS AND ELECTRIC COMPANY 1455 MARKET ST., SUITE BEALE STREET, SUITE 3109 SAN FRANCISCO, CA SAN FRANCISCO, CA FOR: FEDERAL EXECUTIVE AGENCIES FOR: PACIFIC GAS AND ELECTRIC DAVID L. HUARD STEVEN GREENWALD DAVIS WRIGHT TREMAINE LLP MANATT, PHELPS & PHILLIPS, LLP 505 MONTGOMERY STREET, SUITE 800 ONE EMBARCADERO CENTER, 30TH FLOOR SAN FRANCISCO, CA SAN FRANCISCO, CA FOR: SIMON PROPERTY GROUP, INC. FOR: LOWE'S HOME IMPROVEMENT THOMAS J. MACBRIDE, JR. SHIRLEY WOO GOODIN MACBRIDE SQUERI DAY & LAMPREY LLP PACIFIC GAS AND ELECTRIC COMPANY 505 SANSOME STREET, SUITE 900 PO BOX 7442 SAN FRANCISCO, CA SAN FRANCISCO, CA FOR: BUILDING OWNERS AND MANAGERS FOR: PACIFIC GAS AND ELECTRIC ASSOCIATION OF CALIFORNIA DAVID J. BYERS, ESQ. BILL F. ROBERTS, PH. D. ECONOMIC SCIENCES CORPORATION MCCRACKEN, BYERS & HAESLOOP, LLP 1516 LEROY AVENUE 1920 LESLIE STREET BERKELEY, CA SAN MATEO, CA FOR: BUILDING OWNERS AND MANAGERS FOR: CALIFORNIA CITY-COUNTY STREET ASSOCIATION OF CALIFORNIA (BOMA LIGHT ASSOCIATION CAL-SLA R. THOMAS BEACH CAROLYN KEHREIN CROSSBORDER ENERGY ENERGY MANAGEMENT SERVICES 2560 NINTH STREET, SUITE 213A 2602 CELEBRATION WAY BERKELEY, CA WOODLAND, CA FOR: SOLAR ALLIANCE FOR: ENERGY USERS FORUM SCOTT BLAISING RONALD LIEBERT BRAUN BLAISING MCLAUGHLIN P.C. CALIFORNIA FARM BUREAU FEDERATION 915 L STREET, STE RIVER PLAZA DRIVE SACRAMENTO, CA SACRAMENTO, CA FOR: SAN JOAQUIN VALLEY POWER AUTHORITY FOR: CALIFORNIA FARM BUREAU FEDERATION Information Only KHOJASTEH DAVOODI LARRY R. ALLEN UTILITY RATES AND STUDIES OFFICE UTILITY RATES AND STUDIES OFFICE 1322 PATTERSON AVENUE SE SUITE 1000 WASHINGTON NAVY YARD, DC PATTERSON AVENUE SE WASHINGTON NAVY YARD, DC

32 CPUC - Service Lists - A Page 3 of 5 1/20/2009 RALPH E. DENNIS JACK L. BOYD DENNIS CONSULTING ASST. GENERAL COUNSEL 2805 BITTERSWEET LANE SIMON PROPERTY GROUP, INC. LA GRANGE, KY WEST WASHINGTON ST. INDIANAPOLIS, IN FOR: SIMON PROPERTY GROUP, INC. JIM ROSS MAURICE BRUBAKER RCS, INC. BRUBAKER & ASSOCIATES, INC. 500 CHESTERFIELD CENTER, SUITE SWINGLEY RIDGE ROAD, SUITE 140 CHESTERFIELD, MO CHESTERFIELD, MO KEVIN J. SIMONSEN BRUCE REED ENERGY MANAGEMENT SERVICES SR. ATTORNEY 646 EAST THIRD AVENUE SOUTHERN CALIFORNIA EDISON COMPANY DURANGO, CO WANUT GROVE AVE. ROSEMEAD, CA FOR: SOUTHERN CALIFORNIA EDISON COMPANY CASE ADMINISTRATION JENNIFER ALDERETE SOUTHERN CALIFORNIA EDISON COMPANY CASE ADMINISTRATOR LAW DEPARTMENT, ROOM 370 SOUTHERN CALIFORNIA EDISON COMPANY 2244 WALNUT GROVE AVENUE, ROOM 370 PO BOX 800, 244 WALNUT GROVE AVE ROSEMEAD, CA ROSEMEAD, CA FOR: SOUTHERN CALFORNIA EDISON COMPANY FOR: SOUTHERN CALIFORNIA EDISON COMPANY JENNIFER SHIGEKAWA KELLY M. FOLEY SOUTHERN CALIFORNIA EDISON COMPANY SAN DIEGO GAS & ELECTRIC COMPANY 2244 WALNUT GROVE AVENUE 101 ASH STREET, HQ12 ROSEMEAD, CA SAN DIEGO, CA FOR: SOUTHERN CALIFORNIA EDISON COMPANY FOR: SAN DIEGO GAS AND ELECTRIC COMPANY CAROL MANSON DAVID ORTH REGULATORY AFFAIRS GENERAL MANAGER SAN DIEGO GAS & ELECTRIC CO. SAN JOAQUIN VALLEY POWER AUTHORITY 8330 CENTURY PARK COURT CP32D 4886 EAST JENSEN AVENUE SAN DIEGO, CA FRESNO, CA FOR: SAN DIEGO GAS & ELECTRIC CO. FOR: SAN JOAQUIN VALLEY POWER AUTHORITY EVELYN KAHL MICHEL P. FLORIO ALCANTAR & KAHL, LLP THE UTILITY REFORM NETWORK (TURN 33 NEW MONTGOMERY STREET, SUITE VAN NESS AVENUE, SUITE.350 SAN FRANCISCO, CA SAN FRANCISCO, CA FOR: ENERGY USERS AND PRODUCER'S COALITION NINA SUETAKE ROBERT FINKELSTEIN THE UTILITY REFORM NETWORK THE UTILITY REFORM NETWORK 711 VAN NESS AVE., STE VAN NESS AVE., SUITE 350 SAN FRANCISCO, CA SAN FRANCISCO, CA DANIEL PEASE KAREN TERRANOVA PACIFIC GAS AND ELECTRIC COMPANY ALCANTAR & KAHL, LLP 77 BEALE STREET; B10A 120 MONTGOMERY STREET, STE 2200 SAN FRANCISCO, CA SAN FRANCISCO, CA FOR: PACIFIC GAS AND ELECTRIC COMPANY EDWARD G. POOLE JEANNE B. ARMSTRONG ANDERSON, DONOVAN & POOLE GOODIN MACBRIDE SQUERI DAY & LAMPREY LLP 601 CALIFORNIA STREET, SUITE SANSOME STREET, SUITE 900

33 CPUC - Service Lists - A Page 4 of 5 1/20/2009 SAN FRANCISCO, CA SAN FRANCISCO, CA MICHAEL B. DAY JOSH DAVIDSON DAVIS WRIGHT TREMAINE LLP GOODIN MACBRIDE SQUERI DAY & LAMPREY LLP 505 MONTGOMERY ST, STE SANSOME STREET, SUITE 900 SAN FRANCISCO, CA SAN FRANCISCO, CA CALIFORNIA ENERGY MARKETS CASE COORDINATION 425 DIVISADERO STREET, STE 303 PACIFIC GAS AND ELECTRIC COMPANY SAN FRANCISCO, CA PO BOX ; MC B9A SAN FRANCISCO, CA FOR: PACIFIC GAS AND ELECTRIC COMPANY WILLIAM H. BOOTH BARBARA R. BARKOVICH BARKOVICH & YAP, INC. LAW OFFICE OF WILLIAM H. BOOTH PO BOX CARR DRIVE OAKLAND, CA MORAGA, CA FOR: CALIFORNIA LARGE ENERGY CONSUMERS ASSOCIATION MRW & ASSOCIATES, INC. DOCKET COORDINATOR 1814 FRANKLIN STREET, SUITE 720 KEYES & FOX LLP OAKLAND, CA KEITH ST. FOR: MRW & ASSOCIATES, INC. OAKLAND, CA REED V. SCHMIDT WENDY L. ILLINGWORTH BARTLE WELLS ASSOCIATES ECONOMIC INSIGHTS 1889 ALCATRAZ AVENUE 320 FEATHER LANE BERKELEY, CA SANTA CRUZ, CA BILL MARCUS DOUGLAS M. GRANDY, P.E. JBS ENERGY CALIFORNIA ONSITE GENERATION 311 D STREET, STE. A 1220 MACAULAY CIRCLE WEST SACRAMENTO, CA CARMICHAEL, CA FOR: CALIFORNIA ONSITE GENERATION RICHARD MCCANN, PH.D DANIEL GEIS M. CUBED AGRICULTURAL ENERGY CONSUMERS ASSN PORTAGE BAY ROAD, SUITE L STREET, SUITE 800 DAVIS, CA SACRAMENTO, CA FOR: AGRICULTURAL ENERGY CONSUMERS ASSOCIATION. RYAN BERNARDO ANDREW BROWN BRAUN BLAISING MCLAUGHLIN, P.C. 915 L STREET, SUITE 1270 ELLISON SCHNEIDER & HARRIS LLP SACRAMENTO, CA CAPITOL AVENUE, SUITE 400 SACRAMENTO, CA JEDEDIAH J. GIBSON KAREN LINDH LINDH & ASSOCIATES ELLISON SCHNEIDER & HARRIS LLP 7909 WALERGA ROAD, SUITE 112, PMB CAPITOL AVENUE, SUITE 400 ANTELOPE, CA SACRAMENTO, CA State Service AMY C. YIP-KIKUGAWA CALIF PUBLIC UTILITIES COMMISSION DIVISION OF ADMINISTRATIVE LAW JUDGES DEXTER E. KHOURY CALIF PUBLIC UTILITIES COMMISSION ENERGY PRICING AND CUSTOMER PROGRAMS BRA

34 CPUC - Service Lists - A Page 5 of 5 1/20/2009 ROOM 2106 ROOM VAN NESS AVENUE 505 VAN NESS AVENUE SAN FRANCISCO, CA SAN FRANCISCO, CA FOR: DRA DINA S. MACKIN DONALD J. LAFRENZ CALIF PUBLIC UTILITIES COMMISSION CALIF PUBLIC UTILITIES COMMISSION ENERGY DIVISION ENERGY DIVISION AREA 4-A AREA 4-A 505 VAN NESS AVENUE 505 VAN NESS AVENUE SAN FRANCISCO, CA SAN FRANCISCO, CA ERIC GREENE MARYAM GHADESSI CALIF PUBLIC UTILITIES COMMISSION CALIF PUBLIC UTILITIES COMMISSION ENERGY DIVISION ENERGY DIVISION AREA 4-A AREA 4-A 505 VAN NESS AVENUE 505 VAN NESS AVENUE SAN FRANCISCO, CA SAN FRANCISCO, CA ROBERT BENJAMIN TAARU CHAWLA CALIF PUBLIC UTILITIES COMMISSION CALIF PUBLIC UTILITIES COMMISSION ENERGY DIVISION ENERGY PRICING AND CUSTOMER PROGRAMS BRA AREA 4-A ROOM VAN NESS AVENUE 505 VAN NESS AVENUE SAN FRANCISCO, CA SAN FRANCISCO, CA TOP OF PAGE BACK TO INDEX OF SERVICE LISTS