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Erik Jacobson
Director
Regulatory Relations

Pacific Gas and Electric Company
77 Beale St., Mail Code B13U
P.O. Box 770000
San Francisco, CA 94177
Fax: 415-973-3582

November 1, 2018

Advice 5419-E
(Pacific Gas and Electric Company ID U 39 E)

Public Utilities Commission of the State of California
Subject:

Fire Risk Mitigation Memorandum Account Pursuant to Senate Bill 901

Purpose
Pursuant to Senate Bill (SB) 901, Pacific Gas and Electric Company (PG&E) submits this
advice letter to establish the Fire Risk Mitigation Memorandum Account (FRMMA)
effective January 1, 2019.1 The purpose of the FRMMA is “to track costs incurred for fire
risk mitigation that are not otherwise covered in [PG&E’s] revenue requirements,” as
required by SB 901.2
Background
Governor Edmund G. Brown Jr. signed SB 901 on September 21, 2018. The legislation
sets in motion activities to strengthen California’s ability to prevent and recover from
catastrophic wildfires. In addition to measures directed at other entities, SB 901
mandates additional requirements for utility operations, maintenance, and infrastructure
improvements to address wildfire risk, including the implementation of comprehensive fire
prevention plans.
SB 901 describes the requirements of the annual Wildfire Mitigation Plans to be submitted
by the California electric investor-owned utilities (IOUs) to the California Public Utilities
Commission (CPUC or Commission) and sets forth the timing and cost recovery related
to those plans.3 In compliance with the Rulemaking issued on October 25, 2018,4 PG&E
will submit its first Wildfire Mitigation Plan in compliance with the legislation in February
2019.
1

2
3
4

Section 5.1 of General Order 96-B states that the advice letter process is appropriate “to
review a utility’s request to change its tariffs in a manner previously authorized by statute or
Commission order.”
Public Utilities (PU) Code § 8386 (j) (effective Jan. 1, 2019).
PU Code § 8386 (c) (effective Jan. 1, 2019).
Order Instituting Rulemaking to Implement Electric Utility Wildfire Mitigation Plans Pursuant
to Senate Bill 901, R. 18-10-007 (2018).





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Advice 5419-E -2- November 1, 2018 The legislation includes two memorandum accounts to record costs incurred to mitigate wildfire risk. One memorandum account, which PG&E proposes to establish in this advice letter, is intended to “track costs incurred for fire risk mitigation that are not otherwise covered in the electrical corporation’s revenue requirement.”5 An additional memorandum account is required to be established upon approval of a utility’s Wildfire Mitigation Plan “. . . to track costs incurred to implement the plan.”6 Upon approval of the memorandum account in conjunction with the Commission’s approval of PG&E’s first annual Wildfire Mitigation Plan, PG&E would stop recording costs for work approved in its Wildfire Mitigation Plan to the FRMMA and, instead, would record any costs not included in rates to the new memorandum account established concurrently with its Wildfire Mitigation Plan. The FRMMA would remain open to record costs of any additional wildfire mitigation activities not included in the approved Wildfire Mitigation Plan. PG&E is not waiting for approval of its Wildfire Mitigation Plan to take steps to reduce the risk of wildfires in its service area. In advance of submitting its first annual Wildfire Mitigation Plan and the Commission’s review and approval of the plan, PG&E is significantly enhancing its wildfire risk mitigation efforts. These efforts go beyond what was included in PG&E’s 2017 General Rate Case (GRC) Application (A. 15-09-001) and 2018 Catastrophic Event Memorandum Account Application (A.18-03-015). PG&E’s efforts also exceed the activities required by the Fire Safety OIR (R. 08-11-005), the costs of which are recorded in the Fire Hazard Prevention Memorandum Account (FHPMA). PG&E’s additional currently planned activities fall within broad categories set forth in SB 901. Specific areas of focus include: • Investment in advanced system hardening and resiliency, e.g., installing tree wire, installing stronger poles with covered power lines in high fire threat areas, targeted undergrounding; • Expanded automation and protection; • Improved wildfire risk prevention and wildfire detection, e.g., expanded weather station and weather station camera deployment, enhanced wire down detection; and • Enhanced event response capacity, e.g., aviation resources. While these additional activities – and likely others – will be proposed in PG&E’s first annual Wildfire Mitigation Plan and 2020 GRC, the Wildfire Mitigation Plan is unlikely to be approved prior to May 2019. Funding for the activities in PG&E’s Wildfire Mitigation Plan will be requested in PG&E’s 2020 GRC (likely not approved before December 31, 2019) or, where incremental to the 2020 GRC, recorded to the new memorandum account established with the Wildfire Mitigation Plan as required by SB 901.7 To provide for the critical wildfire mitigation activities that PG&E has already begun to implement, PG&E 5 PU Code § 8386 (j) (effective Jan. 1, 2019). PU Code § 8386 (e) (effective Jan. 1, 2019). 7 PU Code § 8386 (g) (effective Jan. 1, 2019). 6
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Advice 5419-E -3- November 1, 2018 proposes to record those costs to the FRMMA. Additionally, as indicated above and consistent with SB 901, PG&E proposes to continue the FRMMA to record the costs of wildfire mitigation activities – if any – that are not included in the approved annual Wildfire Mitigation Plan. These activities could fall into the categories described above or could include new areas, including additional vegetation management activities, not already reflected in the FHPMA, GRC or other cost recovery mechanisms. PG&E anticipates that the recovery of the costs recorded to the FRMMA would occur through a future application at which time the Commission would review the costs for reasonableness as required by SB 901.8 Tariff Revisions Attachment 1 is a proposed Electric Preliminary Statement Part HQ that describes the purpose of and accounting procedures for the FRMMA. This submittal would not increase any current rate or charge, cause the withdrawal of service, or conflict with any rate schedule or rule. Protests Anyone wishing to protest this submittal may do so by letter sent via U.S. mail, facsimile or E-mail, no later than November 21, 2018, which is 20 days after the date of this submittal. Protests must be submitted to: CPUC Energy Division ED Tariff Unit 505 Van Ness Avenue, 4th Floor San Francisco, California 94102 Facsimile: (415) 703-2200 E-mail: EDTariffUnit@cpuc.ca.gov Copies of protests also should be mailed to the attention of the Director, Energy Division, Room 4004, at the address shown above. The protest shall also be sent to PG&E either via E-mail or U.S. mail (and by facsimile, if possible) at the address shown below on the same date it is mailed or delivered to the Commission: 8 PU Code § 8386 (j) (effective Jan. 1, 2019).
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Advice 5419-E -4- November 1, 2018 Erik Jacobson Director, Regulatory Relations c/o Megan Lawson Pacific Gas and Electric Company 77 Beale Street, Mail Code B13U P.O. Box 770000 San Francisco, California 94177 Facsimile: (415) 973-3582 E-mail: PGETariffs@pge.com Any person (including individuals, groups, or organizations) may protest or respond to an advice letter (General Order 96-B, Section 7.4). The protest shall contain the following information: specification of the advice letter protested; grounds for the protest; supporting factual information or legal argument; name, telephone number, postal address, and (where appropriate) e-mail address of the protestant; and statement that the protest was sent to the utility no later than the day on which the protest was submitted to the reviewing Industry Division (General Order 96-B, Section 3.11). Effective Date PG&E requests that this Tier 2 advice submittal become effective on January 1, 2019, which is more than 30 calendar days after the date of submittal. Notice In accordance with General Order 96-B, Section IV, a copy of this advice letter is being sent electronically and via U.S. mail to parties shown on the attached list and the parties on the service list for A.15-09-001, A.18-03-015 and R.08-11-005. Address changes to the General Order 96-B service list should be directed to PG&E at email address PGETariffs@pge.com. For changes to any other service list, please contact the Commission’s Process Office at (415) 703-2021 or at Process_Office@cpuc.ca.gov. Send all electronic approvals to PGETariffs@pge.com. Advice letter submittals can also be accessed electronically at: http://www.pge.com/tariffs/. /S/ Erik Jacobson Director, Regulatory Relations Attachments cc: Service List A.15-09-001, A.18-03-015 and R.08-11-005
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ADVICE LETTER SUMMARY ENERGY UTILITY MUST BE COMPLETED BY UTILITY (Attach additional pages as needed) Company name/CPUC Utility No.: Pacific Gas and Electric Company (ID U39E) Utility type: ELC GAS PLC ✔ HEAT ELC = Electric PLC = Pipeline WATER Contact Person: Yvonne Yang Phone #: (415)973-2094 E-mail: PGETariffs@pge.com E-mail Disposition Notice to: Yvonne.Yang@pge.com EXPLANATION OF UTILITY TYPE GAS = Gas WATER = Water HEAT = Heat (Date Submitted / Received Stamp by CPUC) Tier Designation: 2 Advice Letter (AL) #: 5419-E Subject of AL: Fire Risk Mitigation Memorandum Account Pursuant to Senate Bill 901 Keywords (choose from CPUC listing): Memorandum Account AL Type: Monthly Quarterly Annual ✔ One-Time Other: If AL submitted in compliance with a Commission order, indicate relevant Decision/Resolution #: A.15-09-001, A.18-03-015 and R.08-11-005 Does AL replace a withdrawn or rejected AL? If so, identify the prior AL: No Summarize differences between the AL and the prior withdrawn or rejected AL: Yes ✔ No N/A N/A Yes ✔ No 1/1/19 No. of tariff sheets: 3 Estimated system annual revenue effect (%): N/A Estimated system average rate effect (%): N/A When rates are affected by AL, include attachment in AL showing average rate effects on customer classes (residential, small commercial, large C/I, agricultural, lighting). Tariff schedules affected: Electric Preliminary Statement Part HQ - Fire Risk Mitigation Memorandum Account Service affected and changes proposed1: N/A Pending advice letters that revise the same tariff sheets: N/A 1 Discuss in AL if more space is needed. Clear Form
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Protests and all other correspondence regarding this AL are due no later than 20 days after the date of this submittal, unless otherwise authorized by the Commission, and shall be sent to: CPUC, Energy Division Attention: Tariff Unit 505 Van Ness Avenue San Francisco, CA 94102 Email: EDTariffUnit@cpuc.ca.gov Name: Erik Jacobson, c/o Megan Lawson Title: Director, Regulatory Relations Utility Name: Pacific Gas and Electric Company Address: 77 Beale Street, Mail Code B13U City: San Francisco, CA 94177 Zip: 94177 State: California Telephone (xxx) xxx-xxxx: (415)973-2093 Facsimile (xxx) xxx-xxxx: (415)973-3582 Email: PGETariffs@pge.com Name: Title: Utility Name: Address: City: State: District of Columbia Telephone (xxx) xxx-xxxx: Facsimile (xxx) xxx-xxxx: Email: Zip: Clear Form
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Attachment 1 Advice 5419-E Cal P.U.C. Sheet No. Title of Sheet Cancelling Cal P.U.C. Sheet No. 43314-E ELECTRIC PRELIMINARY STATEMENT PART HQ FIRE RISK MITIGATION MEMORANDUM ACCOUNT (FRMMA) Sheet 1 43315-E ELECTRIC TABLE OF CONTENTS Sheet 1 43270-E 43316-E ELECTRIC TABLE OF CONTENTS Sheet 17 43021-E Page 1 of 1
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Original U 39 Cal. P.U.C. Sheet No. San Francisco, California ELECTRIC PRELIMINARY STATEMENT PART HQ FIRE RISK MITIGATION MEMORANDUM ACCOUNT (FRMMA) HQ. 43314-E Sheet 1 Fire Risk Mitigation Memorandum Account (FRMMA) 1. PURPOSE: The purpose of the Fire Risk Mitigation Memorandum Account (FRMMA) is to record, pursuant to Senate Bill (SB) 901 (Public Utilities Code Section 8386 (j)), incremental costs of fire risk mitigation work that is not otherwise recovered in PG&E’s adopted revenue requirements. Such costs shall include, but are not limited to, expense and capital expenditures for: advanced system hardening and resiliency; expanded automation and protection; improved wildfire detection; enhanced event response capacity, and vegetation management activities. Costs recorded to the FRMMA will not include costs approved for recovery in PG&E General Rate Cases (GRCs) or recovered through PG&E’s Catastrophic Event Memorandum Account (CEMA), Fire Hazard Prevention Memorandum Account (FHPMA) or other cost recovery mechanisms including the memorandum account approved as part of PG&E’s annual Wildfire Mitigation Plan, as set forth in SB 901 (Public Utilities Code Section 8386 (e)). 2. APPLICABILITY: The FRMMA applies to all customer classes, except for those specifically excluded by the Commission. 3. REVISION DATE: Disposition of the balance in this account will be established by a Commission decision through a subsequent application or through other appropriate filing as otherwise authorized by the Commission. 4. RATES: The FRMMA does not have a rate component. 5. ACCOUNTING PROCEDURE: PG&E shall maintain the FRMMA by making entries to this account at the end of each month, or as applicable, as follows (these amounts will exclude costs that have already been authorized in PG&E GRCs or recorded in PG&E’s CEMA, FHPMA or other cost recovery mechanisms): a. A debit entry equal to the expenses incurred related to fire risk mitigation work. b. A debit or credit entry equal to the revenue requirement based on the recorded capital costs, net of RF&U, associated with the incremental costs of plant related to fire risk mitigation work. Capital revenue requirements include depreciation expense, return on investment, federal and state income taxes, and property taxes associated with the costs of installed equipment. c. A credit entry to transfer all or a portion of the balance in this FRMMA to other adjustment clauses for future rate recovery, as may be approved by the CPUC. d. An entry equal to the interest on the average of the balance in the account at the beginning of the month and the balance in the account after the above entries, at a rate equal to one-twelfth the interest rate on three-month Commercial Paper for the previous month, as reported in the Federal Reserve Statistical Release, H.15, or its successor. (N) (N) (N) I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I (N) (Continued) Advice Decision 5419-E Issued by Robert S. Kenney Vice President, Regulatory Affairs Submitted Effective Resolution November 1, 2018
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Cancelling U 39 Revised Revised Cal. P.U.C. Sheet No. Cal. P.U.C. Sheet No. 43315-E 43270-E San Francisco, California ELECTRIC TABLE OF CONTENTS Sheet 1 TABLE OF CONTENTS SCHEDULE CAL P.U.C. SHEET NO. TITLE OF SHEET Title Page ............................................................................................................................... 43315-E Rate Schedules ........................... 42793,42794*,42795,43271,42797*,42798,40921,40236,41965-E Preliminary Statements ........................................ 41966,35423,41796,37737,34373,37727,43316-E Rules ................................................................................................................ 43022,43023,43210-E Maps, Contracts and Deviations ............................................................................................ 37960-E Sample Forms ... 40925*,37631,41151*,41573*, 37632,41152*,41153,37769,41786,36059,37169-E (T) (T) (Continued) Advice Decision 5419-E Issued by Robert S. Kenney Vice President, Regulatory Affairs Submitted Effective Resolution November 1, 2018
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Cancelling U 39 Revised Revised Cal. P.U.C. Sheet No. Cal. P.U.C. Sheet No. 43316-E 43021-E San Francisco, California ELECTRIC TABLE OF CONTENTS PART Sheet 17 CAL P.U.C. SHEET NO. TITLE OF SHEET Preliminary Statements (Cont’d) Part GA Part GB Part GC Part GD Part GE Part GF Part GH Part GI Part GJ Part GK Greenhouse Gas Expense Memorandum Account ....................................... 32419,32420-E Greenhouse Gas Revenue Balancing Account ............................................. 35256,40560-E California Energy Systems for the 21st Century Balancing Account ........................ 40561-E Smart Grid Pilot Deployment Project Balancing Account .................. 32540,32541, 32542-E Statewide Marketing, Education and Outreach Expenditure Balancing Account .... 37728-E Customer Data Access Balancing Account – Electric .............................................. 33136-E Mobile Home Park Balancing Account - Electric ........................................... 41091,41092-E Energy Data Center Memorandum Account – Electric ............................................ 33940-E Major Emergency Balancing Account (MEBA) ......................................................... 40563-E SmartMeterTM Opt-Out Program Balancing Account - Electric (SOPBA-E) ......................................................................................................... 35625,35626,35627-E Part GL Hydro Licensing Balancing Account (HLBA) ............................................................ 40564-E Part GM Nuclear Regulatory Commission Rulemaking Balancing Account (NRCRBA) ........ 40565-E Part GN San Francisco Incandescent Streetlight Replacement Account .............................. 34364-E Part GO Disconnection Memorandum Account - Electric (DMA-E) ....................................... 34604-E Part GP Green Tariff Shared Renewables Memorandum Account (GTSRMA) ..... 40566,40567, 40567-E Part GQ Energy Efficiency Financing Balancing Account – Electric (EEFMA-E) .... 35292,35293,35294-E Part GR Green Tariff Shared Renewables Balancing Account (GTSRBA) ..... 40569,40570,35377-E Part GS Residential Rate Reform Memorandum Account (RRRMA) ......................... 40571,40572-E Part GT Assembly Bill 802 Memorandum Account - Electric ................................................. 40573-E Part GU Z-Factor Memorandum Account (ZFMA-E) .............................................................. 40574-E Part GV Distribution Interconnection Memorandum Account (DIMA) .................................... 40575-E Part GY Electric Vehicle Program Balancing Account (EVPBA) ............................................ 40576-E Part HA Avoided Cost Calculator Memorandum Account ..................................................... 40000-E Part HB Distribution Resources Plan Demonstration Balancing Account ............................. 40577-E Part HC Rule 20A Balancing Account .................................................................................... 41736-E Part HD Tax Memorandum Account (TMA-E)........................................................................ 41088-E Part HE Executive Compensation Memorandum Account (ECMA-E) ........................ 40699,40700-E Part HF Distribution Resources Plan Tools Memorandum Account (DRPTMA) ........ 42139,42140-E Part HG Emergency Consumer Protections Memorandum Account - Electric (WCPMA-E) ............... ....................................................................................................................... 43007,43008-E Part HH Transportation Electrification Balancing Account (TEBA)……42575,42576,42577,42578, ................................................................................................. 42579,42580,42581,42582-E Part HI Solar On Multifamily Affordable Housing Balancing Account (SOMAHBA) ............. 41781-E Part HL Wildfire Expense Memorandum Account (WEMA-E) .................................. 42604, 42605-E Part HQ Fire Risk Mitigation Memorandum Account (FRMMA) ............................................ 43314-E (N) (Continued) Advice Decision 5419-E Issued by Robert S. Kenney Vice President, Regulatory Affairs Submitted Effective Resolution November 1, 2018
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PG&E Gas and Electric Advice Filing List General Order 96-B, Section IV AT&T Albion Power Company Alcantar & Kahl LLP Anderson & Poole Atlas ReFuel BART Barkovich & Yap, Inc. Braun Blaising Smith Wynne P.C. CalCom Solar California Cotton Ginners & Growers Assn California Energy Commission California Public Utilities Commission California State Association of Counties Calpine Casner, Steve Cenergy Power Center for Biological Diversity City of Palo Alto City of San Jose Clean Power Research Coast Economic Consulting Commercial Energy County of Tehama - Department of Public Works Crossborder Energy Crown Road Energy, LLC Davis Wright Tremaine LLP Day Carter Murphy Dept of General Services Don Pickett & Associates, Inc. Douglass & Liddell Downey & Brand Ellison Schneider & Harris LLP Energy Management Service Evaluation + Strategy for Social Innovation GenOn Energy, Inc. Goodin, MacBride, Squeri, Schlotz & Ritchie Green Charge Networks Green Power Institute Hanna & Morton ICF International Power Technology Intestate Gas Services, Inc. Kelly Group Ken Bohn Consulting Keyes & Fox LLP Leviton Manufacturing Co., Inc. Linde Los Angeles County Integrated Waste Management Task Force Los Angeles Dept of Water & Power MRW & Associates Manatt Phelps Phillips Marin Energy Authority McKenzie & Associates Modesto Irrigation District Morgan Stanley NLine Energy, Inc. NRG Solar Office of Ratepayer Advocates OnGrid Solar Pacific Gas and Electric Company Pioneer Community Energy Praxair Regulatory & Cogeneration Service, Inc. SCD Energy Solutions SCE SDG&E and SoCalGas SPURR San Francisco Water Power and Sewer Seattle City Light Sempra Utilities Southern California Edison Company Southern California Gas Company Spark Energy Sun Light & Power Sunshine Design Tecogen, Inc. TerraVerde Renewable Partners Tiger Natural Gas, Inc. TransCanada Troutman Sanders LLP Utility Cost Management Utility Power Solutions Utility Specialists Verizon Water and Energy Consulting Wellhead Electric Company Western Manufactured Housing Communities Association (WMA) Yep Energy
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