Details for: 4418-E (Part 1 of 1).pdf


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

February 18, 2021
ADVICE 4418-E
(U 338-E)
PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA
ENERGY DIVISION
Updated Consumer Risk Tolerance Rate in Southern California
Edison Company's 2014 Assembly Bill 57 Bundled
Procurement Plan

SUBJECT:

PURPOSE
In accordance with pages 23-24 of Decision (D.)12-01-033, Southern California Edison
Company (SCE) respectfully submits to the California Public Utilities Commission
(Commission) this advice letter to update SCE’s Consumer Risk Tolerance (CRT) rate
for year 2021.
BACKGROUND
D.12-01-033 directed that all utilities update the CRT every two years in each LongTerm Procurement Plan (LTPP) application filing (also known as a utility’s Assembly Bill
(AB) 57 Bundled Procurement Plan (BPP)), or via a Tier 1 advice letter two years from
the filing of the previous LTPP or two years from the date of Commission approval of
the previous CRT.1 There was no LTPP or BPP filing during the 2020 LTPP cycle;
therefore, SCE hereby submits this advice letter to update its CRT rate.2
Pursuant to D.12-01-033, SCE provides an update to its CRT in Appendix J, “Valuation
and Risk Management Considerations,” in its 2014 AB 57 BPP. SCE is providing a
clean and redline version of the replacement sheets for Appendix J as attachments to
this advice letter as follows:

1
2

See D.12-01-033 at pp. 23-24, including Footnote 7.
SCE last updated its CRT rate effective in 2019 in Advice 3963-E.

P.O. Box 800

8631 Rush Street

Rosemead, California 91770

(626) 302-9645

Fax (626) 302-6396





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ADVICE 4418-E (U 338-E) -2- February 18, 2021 • Attachment A: Redline Version of Appendix J, Sheet J-5 to SCE’s AB 57 BPP • Attachment B: Clean Version of Appendix J, Sheet J-5 to SCE’s AB 57 BPP Below is a description of the updates made to SCE’s AB 57 BPP. Appendix J, Section 3 – SCE’s Consumer Risk Tolerance Section 3 of Appendix J in SCE’s approved 2014 AB 57 BPP describes SCE’s CRT. Consistent with the Commission’s directive on pages 23-24 of D.12-01-033 to update the CRT, SCE has made the following modification on Sheet J-5: Based on SCE’s current bundled system average rate of 19.7 15.9 cents/kWh, a 10% risk tolerance factor yields a CRT rate of 1.97 1.59 cents/kWh.3 This updated CRT rate will be used in the calculation of the rolling 12-month CRT Metric reflected in SCE’s Monthly Risk Report, submitted to the Energy Division by the 15th business day of each month. No cost information is required for this advice letter. This advice letter will not increase any rate or charge, cause the withdrawal of service, or conflict with any other schedule or rule. TIER DESIGNATION Pursuant to D.12-01-033, page 24, this advice letter is submitted with a Tier 1 designation. EFFECTIVE DATE This advice letter will become effective on March 1, 2021. SAFETY CONCERNS No impacts to safety are anticipated as a result of this advice letter as the advice letter does not provide authority for a specific transaction; rather, it amends SCE's AB 57 BPP by updating its CRT. 3 Additions are shown in underline and deletes are shown with a strike through.
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ADVICE 4418-E (U 338-E) -3- February 18, 2021 NOTICE Anyone wishing to protest this advice letter may do so by letter via U.S. Mail, facsimile, or electronically, any of which must be received no later than 20 days after the date of this advice letter. Protests should be submitted to: CPUC, Energy Division Attention: Tariff Unit 505 Van Ness Avenue San Francisco, California 94102 E-mail: EDTariffUnit@cpuc.ca.gov Copies should also be mailed to the attention of the Director, Energy Division, Room 4004 (same address above). In addition, protests and all other correspondence regarding this advice letter should also be sent by letter and transmitted via facsimile or electronically to the attention of: Gary A. Stern, Ph.D. Managing Director, State Regulatory Operations Southern California Edison Company 8631 Rush Street Rosemead, California 91770 Telephone (626) 302-9645 Facsimile: (626) 302-6396 E-mail: AdviceTariffManager@sce.com Tara S. Kaushik Managing Director, Regulatory Relations c/o Karyn Gansecki Southern California Edison Company 601 Van Ness Avenue, Suite 2030 San Francisco, California 94102 Facsimile: (415) 929-5544 E-mail: Karyn.Gansecki@sce.com With a copy to: Mario E. Dominguez Attorney Southern California Edison Company 2244 Walnut Grove Avenue, 3rd Floor Rosemead, California 91770 Facsimile: (626) 302-6016 E-mail: Mario.E.Dominguez@sce.com
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ADVICE 4418-E (U 338-E) -4- February 18, 2021 There are no restrictions on who may submit a protest, but the protest shall set forth specifically the grounds upon which it is based and must be received by the deadline shown above. In accordance with General Rule 4 of GO 96-B, SCE is serving copies of this advice letter to the interested parties shown on the attached GO 96-B, R.10-05-006, and R.13-12-010 service lists. Address change requests to the GO 96-B service list should be directed by electronic mail to AdviceTariffManager@sce.com or at (626) 302-3719. For changes to all other service lists, please contact the Commission’s Process Office at (415) 703-2021 or by electronic mail at Process_Office@cpuc.ca.gov. Further, in accordance with Public Utilities Code Section 491, notice to the public is hereby given by submitting and keeping the advice letter at SCE’s corporate headquarters. To view other SCE advice letters submitted with the Commission, log on to SCE’s web site at https://www.sce.com/wps/portal/home/regulatory/advice-letters. For questions, please contact Brian Rothstein at (949) 524-7452 or by electronic mail at Brian.Rothstein@sce.com. Southern California Edison Company /s/ Gary A. Stern Gary A. Stern, Ph.D. GAS:br:cm Enclosures
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ADVICE LETTER SUMMARY ENERGY UTILITY MUST BE COMPLETED BY UTILITY (Attach additional pages as needed) Company name/CPUC Utility No.: Southern California Edison Company (U 338-E) Utility type: ELC GAS PLC HEAT ELC = Electric PLC = Pipeline WATER Contact Person: Darrah Morgan Phone #: (626) 302-2086 E-mail: AdviceTariffManager@sce.com E-mail Disposition Notice to: AdviceTariffManager@sce.com EXPLANATION OF UTILITY TYPE GAS = Gas WATER = Water HEAT = Heat (Date Submitted / Received Stamp by CPUC) Tier Designation: 1 Advice Letter (AL) #: 4418-E Subject of AL: Updated Consumer Risk Tolerance Rate in Southern California Edison Company's 2014 Assembly Bill 57 Bundled Procurement Plan Keywords (choose from CPUC listing): Compliance, Procurement AL Type: Monthly Quarterly Annual One-Time Other: If AL submitted in compliance with a Commission order, indicate relevant Decision/Resolution #: Decision 12-01-033 Does AL replace a withdrawn or rejected AL? If so, identify the prior AL: Summarize differences between the AL and the prior withdrawn or rejected AL: Confidential treatment requested? Yes No If yes, specification of confidential information: Confidential information will be made available to appropriate parties who execute a nondisclosure agreement. Name and contact information to request nondisclosure agreement/ access to confidential information: Resolution required? Yes No Requested effective date: 3/1/21 No. of tariff sheets: -0- Estimated system annual revenue effect (%): Estimated system average rate effect (%): 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: None Service affected and changes proposed1: Pending advice letters that revise the same tariff sheets: None 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: Gary A. Stern, Ph.D. Title: Managing Director, State Regulatory Operations Utility Name: Southern California Edison Company Address: 8631 Rush Street City: Rosemead Zip: 91770 State: California Telephone (xxx) xxx-xxxx: (626) 302-9645 Facsimile (xxx) xxx-xxxx: (626) 302-6396 Email: advicetariffmanager@sce.com Name: Tara S. Kaushik c/o Karyn Gansecki Title: Managing Director, Regulatory Relations Utility Name: Southern California Edison Company Address: 601 Van Ness Avenue, Suite 2030 City: San Francisco State: California Zip: 94102 Telephone (xxx) xxx-xxxx: Facsimile (xxx) xxx-xxxx: (415) 929-5544 Email: karyn.gansecki@sce.com Clear Form
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ENERGY Advice Letter Keywords Affiliate Direct Access Preliminary Statement Agreements Disconnect Service Procurement Agriculture ECAC / Energy Cost Adjustment Qualifying Facility Avoided Cost EOR / Enhanced Oil Recovery Rebates Balancing Account Energy Charge Refunds Baseline Energy Efficiency Reliability Bilingual Establish Service Re-MAT/Bio-MAT Billings Expand Service Area Revenue Allocation Bioenergy Forms Rule 21 Brokerage Fees Franchise Fee / User Tax Rules CARE G.O. 131-D Section 851 CPUC Reimbursement Fee GRC / General Rate Case Self Generation Capacity Hazardous Waste Service Area Map Cogeneration Increase Rates Service Outage Compliance Interruptible Service Solar Conditions of Service Interutility Transportation Standby Service Connection LIEE / Low-Income Energy Efficiency Storage Conservation LIRA / Low-Income Ratepayer Assistance Street Lights Consolidate Tariffs Late Payment Charge Surcharges Contracts Line Extensions Tariffs Core Memorandum Account Taxes Credit Metered Energy Efficiency Text Changes Curtailable Service Metering Transformer Customer Charge Customer Owned Generation Mobile Home Parks Name Change Transition Cost Transmission Lines Decrease Rates Non-Core Transportation Electrification Demand Charge Non-firm Service Contracts Transportation Rates Demand Side Fund Nuclear Undergrounding Demand Side Management Oil Pipelines Voltage Discount Demand Side Response PBR / Performance Based Ratemaking Wind Power Deposits Portfolio Withdrawal of Service Depreciation Power Lines Clear Form
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Attachment A
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PROTECTED MATERIALS PURSUANT TO CALIFORNIA PUBLIC UTILITIES COMMISSION DECISIONS AND APPLICABLE LAW. PUBLIC DISCLOSURE RESTRICTED. Southern California Edison Rosemead, California (U 338-E) SOUTHERN CALIFORNIA EDISON COMPANY’S Sheet J-5 CONFORMED 2014 AB 57 BUNDLED PROCUREMENT PLAN APPENDICES • Actual Horizon: This provides the beginning and end month associated with the reporting metrics. • EV: This is the expected value of SCE’s market sensitive procurement costs. • StDev: This provides the standard deviation of SCE’s market sensitive procurement costs. • TEVaR 95: This provides the difference between the 95th percentile procurement costs and the expected procurement cost. Note that the table provides two sets of results, one labeled “hedges in” and one labeled “hedges out.” The results in the “hedges in” set correspond to all the positions in the SCE portfolio. The results in the “hedges out” set correspond to the portfolio of the “hedges in” set with the forward market positions (purchases and sales) taken during the reporting month removed from the portfolio. In the above case, the "hedges in" and "hedges out" portfolio are the same. 3. SCE’s Customer Risk Tolerance The Commission has adopted a Customer Risk Tolerance (CRT) rate equivalent to 10% of the utility’s system average rate at the time of submittal of the conformed bundled procurement plan. Based on SCE’s current bundled system average rate of 19.715.9 cents/kWh, a 10% risk tolerance factor yields a CRT rate of 1.971.59 cents/kWh. (Continued) (To be inserted by utility) Advice 3349-E Decision 15-10-031 1D0 Issued by Russell G. Worden Director (To be inserted by Cal. PUC) Date Filed Effective Resolution
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Attachment B
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PROTECTED MATERIALS PURSUANT TO CALIFORNIA PUBLIC UTILITIES COMMISSION DECISIONS AND APPLICABLE LAW. PUBLIC DISCLOSURE RESTRICTED. Southern California Edison Rosemead, California (U 338-E) SOUTHERN CALIFORNIA EDISON COMPANY’S Sheet J-5 CONFORMED 2014 AB 57 BUNDLED PROCUREMENT PLAN APPENDICES • Actual Horizon: This provides the beginning and end month associated with the reporting metrics. • EV: This is the expected value of SCE’s market sensitive procurement costs. • StDev: This provides the standard deviation of SCE’s market sensitive procurement costs. • TEVaR 95: This provides the difference between the 95th percentile procurement costs and the expected procurement cost. Note that the table provides two sets of results, one labeled “hedges in” and one labeled “hedges out.” The results in the “hedges in” set correspond to all the positions in the SCE portfolio. The results in the “hedges out” set correspond to the portfolio of the “hedges in” set with the forward market positions (purchases and sales) taken during the reporting month removed from the portfolio. In the above case, the "hedges in" and "hedges out" portfolio are the same. 3. SCE’s Customer Risk Tolerance The Commission has adopted a Customer Risk Tolerance (CRT) rate equivalent to 10% of the utility’s system average rate at the time of submittal of the conformed bundled procurement plan. Based on SCE’s current bundled system average rate of 19.7 cents/kWh, a 10% risk tolerance factor yields a CRT rate of 1.97 cents/kWh. (Continued) (To be inserted by utility) Advice 3349-E Decision 15-10-031 1D0 Issued by Russell G. Worden Director (To be inserted by Cal. PUC) Date Filed Effective Resolution
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