August 31, 2010 Advice Letter 2377-E

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1 STATE OF CALIFORNIA ARNOLD SCHWARZENEGGER, Governor PUBLIC UTILITIES COMMISSION SAN FRANCISCO, CA August 31, 2010 Advice Letter 2377-E Akbar Jazayeri Vice President, Regulatory Operations Southern California Edison Company P O Box 800 Rosemead, CA Subject: Franchise Fee Surcharge for City of San Buenaventura Residents Dear Mr. Jazayeri: Advice Letter 2377-E is effective August 12, 2010 per Resolution E Sincerely, Julie A. Fitch, Director Energy Division

2 ADVICE LETTER (AL) SUSPENSION NOTICE ENERGY DIVISION Utility Name: Southern California Edison Date Utility Notified: 9/24/2009 Utility No./Type: 338/Electric [X] to: Advice Letter Nos.: 2377-E Date AL filed: August 26, 2009 Fax No.: N/A Utility Contact Person: James Yee ED Staff Contact: Laura Lei Strain Utility Phone No.: For Internal Purposes Only: Date Calendar Clerk Notified / / Date Commissioners/Advisors Notified / / [X] INITIAL SUSPENSION (up to 120 DAYS) This is to notify that the above-indicated AL is suspended for up to 120 days after September 25, 2009 for the following reason(s) below. If the AL requires a Commission resolution and the Commission s deliberation on the resolution prepared by Energy Division extends beyond the expiration of the initial suspension period, the advice letter will be automatically suspended for up to 180 days beyond the initial suspension period. [ X ] Section 455 Hearing is Required - A Commission resolution may be required to address the advice letter. [ ] Advice Letter Requests a Commission Order [ ] Advice Letter Requires Staff Review Expected duration of initial suspension period: 120 days [ ] FURTHER SUSPENSION (up to 180 DAYS beyond initial suspension period) The AL requires a Commission resolution and the Commission s deliberation on the resolution prepared by Energy Division has extended beyond the expiration of the initial suspension period. The advice letter is suspended for up to 180 days beyond the initial suspension period. If you have any questions regarding this matter, please contact Laura Lei Strain at (213) (LLS@cpuc.ca.gov). cc: Maria Salinas Honesto Gatchalian * Note: reference Decision D , dated February 21, 2002, and Rule 7.5 in appendix A of D.O

3 Akbar Jazayeri Vice President of Regulatory Operations August 26, 2009 ADVICE 2377-E (U 338-E) PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA ENERGY DIVISION SUBJECT: Franchise Fee Surcharge for City of San Buenaventura Residents Pursuant to California Public Utilities Commission (Commission) Decision (D.) , Southern California Edison Company (SCE) hereby requests Commission approval to bill and collect a franchise fee surcharge exceeding the average franchise fee applicable within SCE service territory from City of San Buenaventura (the City) residents. A sample extract from a revised bill format is attached hereto in Attachment A. PURPOSE SCE proposes to add a franchise fee surcharge line item on the electric bills of customers within the City, with revenue produced by the surcharge remitted to the City by SCE. 1 SCE s new franchise agreement with the City, approved by the City Council on July 27, 2009, expressly provides for the additional amount to be surcharged to SCE s customers within the City. BACKGROUND The City currently receives franchise fee revenue from SCE equal to 1% of SCE s gross receipts collected from the sale of electricity within the City limits. SCE recovers franchise fee revenue from all ratepayers by adjusting the Commission authorized revenue requirements prior to setting rates, and remits franchise payments based on agreements with individual franchise jurisdictions. The cost of the collection and remittance of standard franchise fees generic to all cities within SCE s service territory is included in SCE s rates. 1 Shown on customer bills as City Franchise Surcharge. P.O. Box Walnut Grove Ave. Rosemead, California (626) Fax (626)

4 ADVICE 2377-E (U 338-E) August 26, 2009 SCE s new electric franchise agreement (Franchise) with the City, a 25-year electric franchise granted to SCE by the City, was adopted on July 27, 2009 at the City Council meeting. 2 The City Council authorized its staff to request that SCE initiate a 1.0% franchise fee surcharge request with the Commission. The Franchise requires that SCE pay an additional franchise fee to the City equal to 1.0% of SCE s gross receipts from the sale of electricity within the corporate limits of the City, upon approval by the Commission. As an express condition of the City granting SCE a new franchise, the Franchise further requires that SCE use its best efforts to obtain Commission approval to collect the franchise fee surcharge. The terms of the Franchise prescribe that, in order for SCE to bill and collect the additional franchise surcharge for the City, SCE make necessary filings and submissions to the Commission within thirty (30) days of passage of the franchise ordinance. On average, local governments impose a 1% franchise fee on SCE, which is recovered in rates from all of its customers. However, under the Franchise the City will now be imposing a 2% fee on SCE (twice the average). D , dated May 26, 1989 (32 Cal.P.U.C.2d 60), established the procedure for filing an advice letter in instances, such as this one, where a local governmental entity imposes a franchise fee which significantly exceeds the average franchise fee within the service territory of the utility. Pursuant to D , SCE is proposing to pass on the additional 1% required by the Franchise through a surcharge on all SCE customers within the limits of the City. PROPOSAL New 1% Surcharge Section 10.A.2(b) of the Franchise provides that franchise fees be calculated, to incorporate an additional 1% surcharge, as follows: Two percent (2%) of the gross annual receipts of the Grantee derived from the sale of electricity within the limits of the City under this Franchise, of which one percent (1%) of such gross annual receipts is surcharged to Grantee s ratepayers within the limits of the City (hereafter Surcharge ). The additional revenues are to be used for purposes the City deems appropriate. In accordance with D and by the terms of the Franchise, SCE shall collect, with the Commission s approval, the 1.0% surcharge in addition to the existing franchise fee. The surcharge will be the same for all classes of electric customers, and will affect only those SCE customers located in the City. SCE will bill and collect the surcharge and pass through the associated revenue directly to the City. Based on the gross annual electric receipts of the City for 2008, SCE estimates that this surcharge will result in additional revenue remitted to the City of approximately 2 Ordinance No , attached hereto and incorporated by reference.

5 ADVICE 2377-E (U 338-E) August 26, 2009 $845,000 annually. SCE estimates that the 1% surcharge will increase typical monthly electric bills within the City by approximately: $0.63 for a Residential customer; $1.49 for a Small Commercial customer; $19.07 for a Large Commercial customer; $ for an Industrial customer; and $18.65 for an Agricultural customer. Implementation Cost Recovery Billing and collection of the 1% surcharge will require SCE to develop a customized program to augment its existing billing and reporting systems. D , which established the procedure for requesting franchise fees surcharges, also allows for recovery of administrative fees associated with implementing a surcharge. It states that Administrative costs incurred by the utility may be included in the surcharge proposed by the advice letter. 3 Since the surcharge is collected solely for the benefit of the City, it is appropriate that these costs be recovered only from customers within the City. Therefore, SCE proposes to recover the cost of required system changes through an additional percentage to be added to the 1% franchise fee surcharge. SCE will modify its existing systems to calculate the surcharge amount, bill SCE customers within the City the total surcharge, and to ensure that franchise fee surcharge revenue (i.e., the amount associated with the 1%) and implementation cost recovery revenue are properly segregated. In addition, new reports related to the franchise fee transaction and revenue reporting will be developed in compliance with audit procedures. A significant portion of the administrative cost results form the system testing of the end-to-end process to ensure accuracy of billing and reporting. SCE estimates that the total information technology and administrative cost of implementing the new franchise fee surcharge for the City will be approximately $226,000. SCE proposes to recover the implementation costs over a two-year period through a 0.134% adder to the 1% surcharge. SUMMARY SCE customers within the City will see a new City Franchise Surcharge line item on their bills, reflecting 1.134% of their gross bill. SCE will transfer the revenue associated with the 1.0% surcharge to the City and retain the remaining revenue (associated with the 0.134% adder) to offset SCE s implementation costs. SCE estimates that the 1.134% surcharge will increase typical monthly electric bills within the City, for the first two years, by approximately: $0.72 for a Residential customer; $1.69 for a Small Commercial customer; $21.62 for a Large Commercial customer; $ for an Industrial customer; and $21.14 for an Agricultural customer. SCE will track the revenue associated with the 0.134% portion of the total surcharge and costs specifically associated with implementing the franchise fee surcharge. The implementation costs will be detailed and recorded to an SCE capital work order 3 D , [*41] Administriative costs incurred by the utility may be included in the surcharge proposed by the advice letter.

6 ADVICE 2377-E (U 338-E) August 26, 2009 account. Upon full recovery of all implementation costs, SCE will file an advice letter to notify the Commission that costs associated with collecting the surcharge have been recovered, and reduce the franchise fee surcharge reflected on customers bills to 1%. SCE will implement the franchise fee surcharge, as proposed herein, within one hundred eighty (180) days of Commission approval of this filing. No cost information is required for this advice filing. This advice filing will not cause the withdrawal of service, or conflict with any other schedule or rule. TIER DESIGNATION Pursuant to General Order (GO) 96-B, Energy Industry Rule 5.2(1), this advice letter is submitted with a Tier 2 designation. EFFECTIVE DATE This advice filing will become effective on September 25, 2009, the 30 th calendar day after the date filed, pending disposition by Energy Division. NOTICE Anyone wishing to protest this advice filing 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 filing. SCE customers in the City of San Buenaventura may protest this advice letter by May 14, Protests should be mailed to: CPUC, Energy Division Attention: Tariff Unit 505 Van Ness Avenue San Francisco, California jnj@cpuc.ca.gov and mas@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:

7 ADVICE 2377-E (U 338-E) August 26, 2009 Akbar Jazayeri Vice President of Regulatory Operations Southern California Edison Company 2244 Walnut Grove Avenue Rosemead, California Facsimile: (626) AdviceTariffManager@sce.com Bruce Foster Senior Vice President, Regulatory Affairs c/o Karyn Gansecki Southern California Edison Company 601 Van Ness Avenue, Suite 2040 San Francisco, California Facsimile: (415) Karyn.Gansecki@sce.com There are no restrictions on who may file a protest, but the protest shall set forth specifically the grounds upon which it is based and shall be submitted expeditiously. In accordance with Section 4 of GO 96-B, SCE is serving copies of this advice filing to the interested parties shown on the attached GO 96-B service list.. Address change requests to the GO 96-B service list should be directed by electronic mail to AdviceTariffManager@sce.com or at (626) For changes to all other service lists, please contact the Commission s Process Office at (415) 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 filing and keeping the advice filing at SCE s corporate headquarters. To view other SCE advice letters filed with the Commission, log on to SCE s web site at For questions, please contact Ingrid Vigh at (626) or by electronic mail at Ingrid.Vigh@sce.com. Southern California Edison Company AJ:iv:jm Enclosures Akbar Jazayeri

8 CALIFORNIA PUBLIC UTILITIES COMMISSION ADVICE LETTER FILING 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: Contact Person: James Yee ELC GAS Phone #: (626) PLC HEAT WATER Disposition Notice to: EXPLANATION OF UTILITY TYPE ELC = Electric GAS = Gas PLC = Pipeline HEAT = Heat WATER = Water (Date Filed/ Received Stamp by CPUC) Advice Letter (AL) #: 2377-E Tier Designation: 2 Subject of AL: Franchise Fee Surcharge for City of San Buenaventura Residents Keywords (choose from CPUC listing): Compliance AL filing type: Monthly Quarterly Annual One-Time Other If AL filed in compliance with a Commission order, indicate relevant Decision/Resolution #: 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 1 : 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: 9/25/09 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 proposed 1 : Pending advice letters that revise the same tariff sheets: None 1 Discuss in AL if more space is needed.

9 Protests and all other correspondence regarding this AL are due no later than 20 days after the date of this filing, unless otherwise authorized by the Commission, and shall be sent to: CPUC, Energy Division Attention: Tariff Unit 505 Van Ness Ave., San Francisco, CA and Akbar Jazayeri Vice President of Regulatory Operations Southern California Edison Company 2244 Walnut Grove Avenue Rosemead, California Facsimile: (626) Bruce Foster Senior Vice President, Regulatory Affairs c/o Karyn Gansecki Southern California Edison Company 601 Van Ness Avenue, Suite 2040 San Francisco, California Facsimile: (415)

10 Attachment A

11 P.O. Box 600 Rosemead, CA For billing and service inquiries call , 24 hrs a day, 7 days a week Date bill prepared: Dec 7 07 S A M P L E Your electricity bill VALUED CUSTOMER / Page 1 of 6 Customer account Service account ANY AVE Ventura, CA 9xxxx Rotating outage Group A123 Your account summary Amount of your last bill $70.30 Payment we received on Nov 22 '07 - thank you -$70.30 Balance forward $0.00 Your new charges $75.16 Total amount you owe by Dec 27 '07 $75.16 Compare the electricity you are using Your current read for meter Dec 6 ' Your previous read - Nov 5 ' Total electricity you used this month in kwh 500 Your next meter read will be on or about Jan 5 '08. Your daily average electricity usage (kwh) 2 Years ago: Last year: This year: Your monthly usage may be higher than usual Based on your historical usage pattern, your monthly usage is trending higher than normal. As a result, you may notice an increase in your bill. If you would like information on tips and programs that can help you lower your energy usage and your bill, please visit 0 Dec '05 Dec '06 Jan '07 Feb '07 Mar '07 Apr '07 May '07 Jun '07 Jul '07 Aug '07 Sep '07 Oct '07 Nov '07 Dec '07 Please return the payment stub below with your payment and make your check payable to Southern California Edison. If you want to pay in person, call for locations, or you can pay online at Customer account Please write this number on your check. Make your check payable to Southern California Edison. Amount due by Dec 27 '07 $75.16 Amount enclosed $ VALUED CUSTOMER ANY AVE MNTERYPK, CA P.O. BOX 600 ROSEMEAD, CA

12 Contact information Customer service numbers Important information *Note - Symbols will appear on production bills Multicultural services (Available Monday Friday 8 a.m. 5 p.m.) General Services (U.S. & Canada) Cambodian Account Balances & Extensions Chinese Emergency Services & Outages Korean California Alternate Rates for Energy (CARE) Vietnamese Electric Industry Restructuring Spanish Energy Theft Hotline (7 dias a la semana 8 a.m. 8 p.m.) Hearing & Speech Impaired (TTY) Correspondence: Southern California Edison (SCE) P.O. Box 6400 Rancho Cucamonga, CA Rotating Outages A rotating outage is a controlled electric outage that lasts approximately one hour for a group of circuits, which is used during electric system emergency conditions to avoid widespread or uncontrolled blackouts. Each SCE customer is assigned a rotating outage group, shown on the upper part of the SCE bill. If your rotating outage group begins with the letters A, M, R, S, or X, you are subject to rotating outages. If it begins with N or Exempt, you are not. Your rotating outage group may change at any time. For more information, and to see which rotating outage groups are likely to be called in the event of a system emergency, visit or call (800) Options for Paying Your Bill You can pay your bill by: Mail In person at an authorized payment location Telephone Online at You may call us for electronic payment options, to make payment arrangements or for information on agencies to assist you in bill payment. Past-Due Bills Your bill was prepared on December 7, Your bill is due when you receive it and becomes past due 19 days after the date the bill was prepared. You will have 15 days at your new address to pay a bill from a prior address before your service will be terminated. SCE does not terminate residential service for non-payment of bills for other classes of service. Termination of electric service requires a reconnection charge. A field assignment charge may appear on your next bill if SCE visits your premises because of non-payment. If you are a residential customer, and claim an inability to pay and payment arrangements have not been extended to you by SCE pursuant to SCE's filed tariffs, you may contact the California Public Utilities Commission (CPUC). Disputed Bills S A M P L E If you think your bill is incorrect, call us and speak with a customer service representative, or if necessary, with a manager. If you feel unsatisfied with the result of such discussion(s), contact the CPUC by mail at: 505 Van Ness, San Francisco, CA 94102; or at: www. cpuc.ca.gov, (800) , TTY: (800) Include a copy of your bill, why you believe SCE did not follow its rules and rates, and a check or money order made out to the CPUC for the disputed amount. You must pay the disputed amount, or send it to the CPUC, before the past-due date to avoid disconnection. The CPUC accepts payment only for matters relating directly to bill accuracy. While the CPUC is investigating your complaint, you must pay any new SCE bills that become due. Rules and Rates SCE s rules and rates are available in full at or upon request. Late Payment Charge (LPC) A late payment charge of.9% will be applied to the total unpaid balance on your account if full payment is not received by the due date on this bill (except for CARE and state agency accounts). Electronic Fund Transfers (EFT) When you provide a check as payment, you authorize us either to use information from your check to make a one-time electronic fund transfer from your account or to process the payment as a check transaction. When we use information from your check to make an electronic fund transfer, funds may be withdrawn from your account as soon as the same day we receive your payment. You will not receive your check back from your financial institution, but the transaction will appear on your financial institution statement. If you do not wish to authorize an electronic fund transfer, please call the 800 number on the front of your bill. Definitions DWR Bond Charge: Bonds issued by the Department of Water Resources (DWR) to cover the cost of buying power for customers during the energy crisis are being repaid through this charge. DWR Generation: Charges for that portion of your energy usage provided by the DWR; these are collected by SCE as an agent for DWR. Historic Procurement Charge (HPC): The HPC has been authorized by the CPUC to allow SCE to recover past undercollections. SCE Generation: These charges recover energy procurement and generation costs for that portion of your energy provided by SCE. Effective September 20, 2001, your ability to enter into new contracts to purchase electricity from a supplier other than SCE was suspended by the CPUC. Customers who were taking Direct Access service or who had a signed contract prior to September 20, 2001, may switch suppliers consistent with CPUC-established rules. Trust Transfer Amount (TTA): This reflects the Fixed Transition Amount (FTA), chargeable to residential and small commercial customers pursuant to state law and a financing order issued by the CPUC. The TTA is the property of SCE Funding Limited Liability Corporation (LLC) and is collected by SCE solely as the servicing agent for SCE Funding LLC. To change your contact information or enroll in SCE's payment option, complete the form below and return it in the enclosed envelope. VALUED CUSTOMER / Page 2 of 6 Change of Mailing Address: STREET# STREET NAME APARTMENT # CITY STATE ZIP CODE TELEPHONE # ADDRESS Direct Payment (Automatic Debit) Enrollment: I hereby authorize SCE and my financial institution to automatically deduct my monthly payment from the checking account as shown on my enclosed check, ten calendar days after my bill is mailed. Signature Date To change your checking account information or to be removed from the Direct Payment program please call

13 Details of your new charges Your rate: Domestic Billing period: Nov 5 07 to Dec 6 07 (31 days) S A M P L E VALUED CUSTOMER / Page 3 of 6 Delivery charges Basic charge 31 days x $ $0.90 Energy - Winter Tier 1 (within baseline) 313 kwh x $ $21.36 Tier 2 (up to 30%) 94 kwh x $ $6.37 Tier 3 (31% to 100%) 93 kwh x $ $6.30 DWR bond charge 500 kwh x $ $2.35 Generation charges DWR Energy - Winter 147 kwh x $ $13.95 SCE Energy - Winter Tier 1 (within baseline) 221 kwh x $ $5.86 Tier 2 (up to 30%) 66 kwh x $ $3.55 Tier 3 (31% to 100%) 66 kwh x $ $11.43 Subtotal of your new charges $72.07 City Franchise Surchg $72.07 x % $.82 Ventura UUT $72.07 x % $2.16 State tax 500 kwh x $ $0.11 Your new charges $75.16 Your Delivery charges include: $2.63 transmission charges $24.86 distribution charges $0.29 nuclear decommissioning charges $3.54 public purpose programs charge $3.57 trust transfer amount Your Generation charges include: $0.64 competition transition charge Your overall energy charges include: $ 2.56 franchise fees Additional information: DWR provided % of the energy you used this month Your winter baseline allowance: kwh Average cost per kilowatt hour Tier 1 Tier 2 Tier 3 Tier 4 Tier 5 $0.12 $0.14 $0.21 $0.25 $ kwh 94 kwh 93 kwh Understanding your bill Your usage for this billing period falls in the third tier. Energy usage is based upon a tiered structure. For most customers, the price you pay per kilowatt hour increases as you use more energy. The average cost per kilowatt hour (kwh) figures in the chart to the left are based on averages. Actual prices may vary. For more information visit Things you should know Get $35 Let SCE pick up and recycle your old, inefficient, working refrigerator or freezer and receive $35. Program funds are limited, so call or visit and click on rebates and savings today! Terms and conditions apply.

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34 James W. Yee Supervisor of Advice Letters California Public Utilities Commission 505 Van Ness Avenue, 4 th Floor San Francisco, CA Attn: Honesto Gatchalian Energy Division August 31, 2009 Re: Substitute Sheets for Southern California Edison Company s Advice 2377-E Dear Mr. Gatchalian: Enclosed are the original and three copies of substitute sheets for Southern California Edison Company s (SCE) Advice 2377-E, Franchise Fee Surcharge for City of San Buenaventura Residents. The enclosed copy of Ordinance No , as referenced in footnote 2 on page 2 of the advice letter, was inadvertently excluded from the advice filing. As requested by the Energy Division, the protest period for Advice 2377-E will commence today with all protests due by Monday, September 21, Please include these sheets in your master file for Advice 2377-E and distribute the copies to the appropriate people reviewing Advice 2377-E. Should you have any questions, please contact me at (626) Sincerely, JWY:sq Enclosures James W. Yee cc: Don Lafrenz, Energy Division Maria Salinas, Energy Division Paul J. Loh, Esq., Willenken Wilson Loh & Lieb LLP M. Rebeca Mendoza, City of San Buenaventura Parties on SCE s GO 96-B service list P.O. Box Walnut Grove Ave. Rosemead, California (626) Fax (626)

35 James W. Yee Supervisor of Advice Letters March 5, 2010 California Public Utilities Commission 505 Van Ness Avenue, 4 th Floor San Francisco, CA Attn: Honesto Gatchalian Energy Division Re: Substitute Sheet for Southern California Edison Company s Advice 2377-E Dear Mr. Gatchalian: Enclosed are the original and three copies of a substitute sheet for Southern California Edison Company s (SCE) Advice 2377-E, Franchise Fee Surcharge for City of San Buenaventura Residents. On page 4 of this advice letter, an additional sentence has been added under the section Notice to include a protest period for the City of San Buenaventura. The sentence reads, SCE customers in the City of San Buenaventura may protest this advice letter by May 14, Please include this substitute sheet in your master file for Advice 2377-E and distribute the copies to the appropriate people reviewing Advice 2377-E. Should you have any questions, please contact me at (626) Sincerely, JWY:jm Enclosures James W. Yee cc: Don Lafrenz, Energy Division Maria Salinas, Energy Division Parties on SCE s GO 96-B P.O. Box Walnut Grove Ave. Rosemead, California (626) Fax (626)