Details for: SCE's Reply to Tesla's Response to Advice 3853-E.pdf


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Gary A. Stern, Ph.D.
Managing Director, State Regulatory Operations

October 4, 2018
Energy Division
Attention: Tariff Unit
California Public Utilities Commission
505 Van Ness Avenue
San Francisco, CA 94102
Re:

Southern California Edison Company’s Reply to Tesla, Inc.’s Late
Response to Advice 3853-E, Establishment of Time-of-Use Rates for
Commercial Electric Vehicle Charging and Modification to the Rule 1
Definition of Electric Vehicle in Compliance with Decision 18-05-040

Dear Energy Division Tariff Unit:
In accordance with Section 7.4.3 of General Order (GO) 96-B, Southern California
Edison Company (SCE) hereby replies to Tesla, Inc.’s (Tesla) Late Response to Advice
3853-E.
BACKGROUND
In compliance with the California Public Utilities Commission’s (Commission or CPUC)
Ordering Paragraph (OP) 45 of Decision (D.)18-05-040, Decision on the Transportation
Electrification Standard Review Projects (Decision), SCE submitted Advice 3853-E
(Advice Letter) on August 29, 2018, to modify the definition of Electric Vehicle (EV) in
SCE’s Rule 1, Definitions, to be consistent with the statutory definition of transportation
electrification codified in Public Utilities Code Section 237.5. In addition, SCE proposed
to establish the following optional time-of-use (TOU) rates for commercial electric
vehicle charging (collectively, the New EV Rates):
•
•
•

Schedule TOU-EV-7, General Service Time-of-Use, Electric Vehicle Charging;
Schedule TOU-EV-8, General Service Time-of-Use, Electric Vehicle Charging,
Demand Metered; and
Schedule TOU-EV-9, General Service Time-of-Use, Electric Vehicle Charging,
Large Demand Metered.

In the Advice Letter, SCE stated the New EV Rates shown in Attachment A of the
Advice Letter are for illustrative purposes only and that SCE will update the New EV
Rates proposed once the Commission issues its final decision on SCE’s 2018 General
Rate Case (GRC) Phase 2. Furthermore, SCE requested that the New EV Rates
become effective concurrent with SCE’s proposed effective date for its 2018 GRC
Phase 2 rate changes, expected to be in the first quarter of 2019.
P.O. Box 800

8631 Rush Street

Rosemead, California 91770

(626) 302-9645

FAX (626) 302-6396





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Energy Division Tariff Unit Page 2 October 4, 2018 On August 31, 2018, Energy Division issued a notice suspending the Advice Letter because it requires staff review. On September 27, 2018, Tesla submitted a late Response to the Advice Letter and stated its support of the New EV Rate structure.1 In addition, Tesla requested that the Commission direct SCE to make the New EV Rates available by November 1, 2018, rather than deferring implementation until after the Commission issues a final decision on SCE’s GRC Phase 2.2 Tesla claims that there is no compelling need to delay the implementation of the New EV Rates. DISCUSSION SCE appreciates Tesla’s Response to the Advice Letter and support of SCE’s proposed New EV Rates. However, SCE disagrees with Tesla’s claim that there is no compelling need to delay implementing the New EV Rates as discussed below. I. Federal Energy Regulatory Commission’s Approval of the Transmission Cost Recovery Method Is Necessary Prior to the Implementation of the New EV Rates In the Decision, the Commission adopted the Joint Stipulation set forth in Exhibit Joint12 of SCE’s Application (A.) 17-01-02.3 The Joint Stipulation included, among other things, the 70/30 proxy allocation method for recovering transmission retail rate costs, which the Commission conditionally approved on a temporary 3-year basis provided that SCE seeks approval from the Federal Energy Regulatory Commission (FERC) for the initial 5-year energy only rate structure, and for the overall 10-year transition plan to include the ultimate 70/30 split of transmission retail rate cost recovery structure.4 The request for FERC’s approval is consistent with the requirements under Section 205(d) of the Federal Power Act, 16 U.S.C. § 824d (2018), and Section 35.13 of the FERC’s regulations, 18 C.F.R. § 35.13 (2018). In addition, SCE is required to make a singleissue Section 205 filing to revise its retail transmission rates pursuant to Section 8d of the Protocols of the Formula Rate5 that states: 1 2 3 4 5 Pursuant to General Order (GO) 96-B, General Rule 7.4.1, the protest period ended on September 18, 2018, which is 20 days after the Advice Letter was submitted. The Energy Division notified SCE on September 28, 2018, that it would consider Tesla’s late-submitted Response as provided in GO 96-B, General Rule 7.4.4. See Tesla’s Response at p. 1. A.17-01-021, Exhibit No. Joint-12, Southern California Edison Company, Office of Ratepayer Advocates, Natural Resources Defense Council, Environmental Defense Fund, Siemens, Sierra Club, and the Coalition of California Utility Employees Stipulation. See D.18-05-040 at p. 114. See also OP 43 at p. 161. SCE’s Formula Rate is set forth in Appendix IX of SCE’s Transmission Owner Tariff, FERC Electric Tariff, Third Revised Volume No. 6. Attachment 1 to Appendix IX are the Formula Protocols.
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Energy Division Tariff Unit Page 3 October 4, 2018 “SCE will make a single-issue Section 205 filing to revise Schedule 33 of the Formula Rate determination of retail transmission rates to reflect any change in Rate Groups, Rate Schedules, or the design of retail rates applicable to each Rate Schedule subsequent to any final CPUC order that affects these aspects of retail transmission rates. SCE will make such a filing only if and when the change in Rate Groups, Rate Schedules, or the design of retail rates cannot otherwise be reflected through the normal operation of the Formula Rate. In the single-issue Section 205 filing to the Commission, SCE will propose revisions to Schedule 33 of the Formula Rate that conform to the CPUC order. SCE will make a filing under this Section 8(d) by the later of either the filing date for the next Annual Update following the CPUC ruling or sixty days after the CPUC ruling.” (Emphasis added.) In addition, Energy Division confirmed on September 20, 2018, that the Commission’s approval of SCE’s proposed New EV Rates is contingent upon FERC’s approval of the stipulated method for recovering transmission retail rate costs as ordered in OP 43 of the Decision.6 Energy Division directed SCE to supplement the Advice Letter describing SCE’s plan to request for the FERC’s approval prior to the implementation of the New EV Rates. Moreover, Energy Division directed SCE to wait until the Advice Letter has been disposed before filing anything with the FERC. Accordingly, SCE plans to supplement the Advice Letter on October 4, 2018. Subsequently, consistent with Energy Division’s direction and according to the Protocols of the Formula Rate described above, SCE will submit a request to the FERC to approve SCE’s method for recovering transmission retail rate costs associated with the New EV Rates by mid to late November 2018.7 SCE anticipates the FERC’s approval by early 2019. II. Implementation of the New EV Rates Involves a Comprehensive Process and They Should be Implemented Concurrent with the Rate Changes Related to Other Commission-Approved Rate Changes to Mitigate Any Customer Confusion Tesla concludes that the attached tariff sheets in the Advice Letter indicate that SCE’s billing systems have already been updated with the New EV Rates and can be made available to customers.8 Tesla does not provide any support for reaching this conclusion. Moreover, Tesla does not have any expertise on the comprehensive process involved in establishing and implementing new tariff rates. Attaching the tariff sheets to the Advice Letter does not indicate that SCE’s billing has been updated as developing the tariff sheets and updating the billing systems are 6 7 8 SCE had conference calls with Energy Division regarding the implementation of the New EV Rates on September 5, 2018, and September 20, 2018. The Annual Update pursuant to Section 8d of the Protocols of the Formula Rate is scheduled on or before December 1 or each year. See Tesla’s Response at p. 3.
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Energy Division Tariff Unit Page 4 October 4, 2018 independent processes. In addition, while the tariff sheets with the “proposed” New EV Rates have been submitted with the Advice Letter, they cannot be made available to customers until SCE receives Commission's approval of the Advice Letter. As part of the process of implementing the New EV Rates, SCE needed to plan and determine the most efficient way to implement them while mitigating any customer confusion inherent whenever multiple compliance rate changes and/or establishment of new rates occur around the same time. SCE coordinates significant rate changes to implement at the same time to assist customers in learning about and assessing the impacts of the new or modified rates to their energy accounts. As such, SCE has determined it would be best to align the New EV Rates scope with the recently approved 2016 Rate Design Window9 and pending 2018 GRC Phase 2 scope and targeted the first quarter of 2019 for implementation. To deploy the entire scope, SCE’s team must go through the standard software project lifecycle that includes planning and analysis, design, construction, testing, and implementation of the requirements in order to update SCE’s billing system, data warehouse, and other back-end systems. If SCE had to move up the implementation of the New EV Rates on November 1, 2018 as proposed by Tesla, SCE would not have sufficient time to fully test the New EV Rates or unbundle complex billing system codes. In addition, removing the New EV Rates from the entire scope and moving up the implementation date prior to the first quarter of 2019 would negatively impact the entire project scope because all rate updates and changes are scheduled to follow the same schedule for construction, testing, and implementation. Furthermore, changing the scope now would delay the scheduled implementation of the other GRC Phase 2 changes. 9 See D.18-07-006, Decision on Southern California Edison Company’s 2016 Rate Design Window Application, issued July 13, 2018.
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Energy Division Tariff Unit Page 5 October 4, 2018 CONCLUSION SCE appreciates Tesla’s support of the proposed New EV Rates. However, for the reasons stated above, the Commission should reject Tesla’s recommendation to implement the New EV Rates as soon as November 1, 2018. Sincerely, /s/ Gary A. Stern, Ph.D. Gary A, Stern, Ph.D. GAS:sl:jm cc: Edward Randolph, Director, CPUC Energy Division Dorothy Duda, CPUC Energy Division Carolyn Sisto, CPUC Energy Division Francesca Wahl, Tesla Inc. Julia Johnston, Tesla Inc.
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