Details for: PGE AL 5527-E-B.pdf


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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

June 5, 2019

Advice 5527-E-B
(Pacific Gas and Electric Company ID U 39 E)

Public Utilities Commission of the State of California
Subject:

Second Supplemental: Implementing the 2019 Energy Resource
Recovery Account (ERRA) Forecast Revenue Requirement in
Compliance with Decision 19-02-023

Purpose
At the request of the Energy Division of the California Public Utilities Commission
(Commission or CPUC), Pacific Gas and Electric Company (PG&E) hereby submits a
second supplement to its compliance advice letter pursuant to Decision (D.)19-02-023
(the “2019 ERRA Forecast Decision”).
Background
On February 21, 2019, the CPUC issued D.19-02-023 approving PG&E’s 2019 ERRA
Forecast Application (A.18-06-001), with modifications. In Ordering Paragraph (OP) 1 of
the 2019 ERRA Forecast Decision, the Commission: (1) adopted a 2019 electric
procurement revenue requirement of $2,907.4 million, comprising of $1,653.2 million for
ERRA; $80.3 million for the Ongoing Competitive Transition Charge (Ongoing CTC);
$1,042.9 million for the Power Charge Indifference Amount (PCIA), less the amount of
the brown power true-up; and $131.1 million for the Cost Allocation Mechanism (CAM),
and (2) approved PG&E’s 2019 electric sales and peak load forecasts.
The 2019 ERRA Forecast Decision also required PG&E to make further modifications to
its 2019 ERRA Forecast proposals. Specifically, OP 2 required PG&E to file a Tier 2
advice letter within 15 days, including tariff sheets,1 and OP 3 allows for updates to the
1

In a March 12, 2019 letter to the Executive Director of the CPUC (Extension Request), PG&E
requested a 30-day extension to comply with OPs 2 and 5 of the 2019 ERRA Forecast Decision.
PG&E’s March 12, 2019 Extension Request is available at:
http://pgera.azurewebsites.net/Regulation/ValidateDocAccess?docID=556196. PG&E’s request
recognized that the Commission’s direction to include a true-up of the 2018 forecast year for
brown power required first-of-a-kind calculations “. . . in the absence of a pre-existing accounting
(continued next page)





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Advice 5527-E-B -2- June 5, 2019 balancing account balances consistent with the process used in the Annual Electric Trueup (AET). OP 4 ordered PG&E to calculate PCIA rates using approved allocation factors and forecasted system sales. Finally, OP 5 ordered PG&E to true-up the brown power value included in the indifference calculation used to determine PCIA rates, commencing with the 2018 subject year. On April 18, 2019, PG&E requested approval in Advice 5527-E to implement the 2019 ERRA Forecast revenue requirement, including an update to balancing accounts based on recorded end-of-year balances, the use of forecasted 2019 system sales to calculate Ongoing CTC and PCIA rates, and a true-up of the 2018 PCIA rates to reflect 2018 brown power costs and revenues. On May 15, 2019, PG&E provided a supplemental analysis that contains a revenue-only update to the PCIA calculation presented in Advice 5527-E and removes the cost component of the PCIA brown power true up for 2018. PG&E’s Advice 5527-E-A was submitted as PG&E’s version of the PCIA calculation for which Southern California Edison Company (SCE) included as Appendix C in their advice letter complying with D.19-02024.2 In the alternate calculation, which was developed at the request of the CPUC’s Energy Division, PG&E produced a revenue-only update to the PCIA calculation that removes the cost component of the PCIA brown power true up for 2018. This was achieved by replacing the 2018 actual Total Portfolio costs on line 1 of AL 5527-E, Appendix B, Exhibit 4, with the 2018 forecasted Total Portfolio Costs from the 2018 PCIA template approved in D.18-01-009. The remainder of the calculation methodology is unchanged from that presented in Advice 5527-E. Discussion In this second supplement, PG&E calculates the 2018 brown power true-up “refund rates” as it did in prior advice letter submittals, except PG&E does not make any pro rata adjustment to the 2018 vintage rates. Rather, PG&E applies the same methodology as used for the 2009 through 2017 vintages. The extra step of applying actual sales to derive the 2018 vintage refund rate and all related adjustments have been eliminated from the 2018 brown power refund rate calculations. As such, the 2018 vintage refund rate is the same as the 2017 vintage refund rate. PG&E is also updating the generation rate ratios in the 2019 PCIA rate calculation for 2019 sales. In the two prior advice letter filings, PG&E had used generation rate ratios based on 2018 sales for its illustrative PCIA rates, with the intention that the sales would be updated when rates were implemented. Given the timing between this second method for trueing-up 2018 brown power costs and revenues.” On March 18, the Energy Division granted PG&E’s extension request to file its advice letter on April 18, 2019. 2 See SCE’s Advice 3972-E, Appendix C, in which actual 2018 market prices are trued up to actual PCIA-eligible generation deliveries and realized Ancillary Services revenues, but the trueup excludes costs.
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Advice 5527-E-B -3- June 5, 2019 supplement and the planned July 1 implementation date, PG&E is making this update now. Neither the total 2019 PCIA RRQ nor the total refund from the brown power trueup to departed load customers changes from the generation rate ratio update. No changes have been made to the calculation of the brown power indifference amount as presented in Advice 5527-E-A. With the change to the 2018 brown power true-up refund rate calculation described above, the amount of the PCIA refund related to the brown power true-up is approximately $79 million as shown in Table 1. This amount represents a cost shift to bundled customers. PG&E provided the additional calculations solely in response to Energy Division’s requests. TABLE 1 SUMMARY OF CHANGES BETWEEN PG&E’S ADVICE 5527-E-B, 5527-E-A, AND 5527-E ($ 000) (A) Line No. Category (B) (C) (A) – (C) Advice 5527-E-B Advice 5527-E-A Advice 5527-E Difference $2,102,527 $5,133,983 1 2 CAISO Market Revenues Portfolio Cost (a) $2,102,527 $5,133,983 3 Change in the Indifference ($169,479) 4 2018 PCIA Refund to Departed Load ________________ (a) Excludes the CTC resource costs. $79,170 ($169,479) $55,076 $2,102,527 $5,187,953 $0 ($53,970) ($114,894) ($54,585) $36,327 $42,843 Exhibits Accompanying this Supplemental Advice Letter In support of this second supplemental advice letter, PG&E includes the following appendices in Advice 5527-E and 5527-E-A: Appendix B: Calculation of the change in PCIA indifference amounts by vintage resulting from the 2018 brown power true up (see tabs labeled “Exhibits 1-4” submitted in 5527-E-A).3 Appendix C: Revised workpapers supporting calculation of the PCIA indifference amounts by vintage; and 3 As noted above, PG&E is not making any further change to the brown power true-up calculation. As such, Appendix B to Advice 5527-E-B is identical to Appendix B to Advice 5527-E-A.
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Advice 5527-E-B -4- June 5, 2019 Appendix D: Revised comparison of the proposed 2019 average generation rates for bundled customers, ongoing CTC rates, PCIA rates, and new system generation charge rates with current 2018 rates. These revised appendices in Excel format have been provided to the CPUC’s Energy Division and the service list, and are also available upon request by emailing PGETariffs@pge.com and referencing PG&E’s Advice 5527-E-B. Protests Anyone wishing to protest this submittal may do so by letter sent via U.S. mail, facsimile or E-mail, no later than June 7, 2019, which is 2 business days after the date of this submittal. The shortened protest period was requested by the CPUC Energy Division. 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: 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
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Advice 5527-E-B -5- June 5, 2019 (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 letter become effective immediately, in order to be consolidated with other potential PG&E rate changes on July 1, 2019.4 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.18-06-001. 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: 4 Tim Lindl, Counsel for Joint Community Choice Aggregators Franz Cheng, CPUC Energy Division Ehren Seybert, CPUC Energy Division David Zizmor, CPUC Energy Division Service List A.18-06-001 PG&E notes that if there are other revenue requirement or rate changes not known at this time but approved prior to the time PG&E implements the 2019 ERRA, the final rates shown in the accompanying pro forma tariffs may also change.
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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) #: 5527-E-B Subject of AL: Second Supplemental: Implementing the 2019 Energy Resource Recovery Account (ERRA) Forecast Revenue Requirement in Compliance with Decision 19-02-023 Keywords (choose from CPUC listing): Compliance AL Type: Monthly Quarterly Annual ✔ One-Time Other: If AL submitted in compliance with a Commission order, indicate relevant Decision/Resolution #: Decision 19-02-023 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 Yes ✔ No ✔ No 6/5/19 No. of tariff sheets: N/A 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: 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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PG&E Gas and Electric Advice Submittal List General Order 96-B, Section IV AT&T Albion Power Company Alcantar & Kahl LLP Alta Power Group, LLC Anderson & Poole Atlas ReFuel BART Barkovich & Yap, Inc. P.C. CalCom Solar California Cotton Ginners & Growers Assn California Energy Commission California Public Utilities Commission California State Association of Counties Calpine Cameron-Daniel, P.C. 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 East Bay Community Energy Ellison Schneider & Harris LLP Energy Management Service Pioneer Community Energy Praxair Regulatory & Cogeneration Service, Inc. SCD Energy Solutions Engineers and Scientists of California 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 Peninsula Clean Energy 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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