Late last evening the Assembly committee passed its version of the Edison MOU (SB 78).
Despite attempts by consumer groups to weaken and/or eliminate the DA provisions in the bill, the bill passed with the DA provisions intact.
The DA provisions in the bill that passed out of the committee are essentially the same as those discussed previously (see previous note attached).
The Assembly will now attempt to get the bill out of the Appropriations committee today or tomorrow--the expectation is that the bill will make it out of that committee.
When and if the bill makes it out of the Appropriations committee, the Assembly will attempt to pass it out of the full Assembly.
If it makes it out of the full Assembly, it will then go to the Senate for approval, where the leader of the Senate, John Burton, continues to say publicly that the chances of passage in the Senate are slim.
On the PUC front, efforts are underway to stop the PUC from passing the proposal it issued last week.  
The current PUC proposal would suspend DA retroactive to July 1.
In conversations with the Governor's point people in charge of getting the bill passed, they indicated that they are aware of the problems with the PUC proposal and are working to resolve it.

We'll continue to provide updates.  If you have any questions, don't hesitate to contact me at 415.782.7822.

Best,
Jeff

****************************************************************************************************************************************
 -----Original Message-----
From: 	Dasovich, Jeff  
Sent:	Monday, August 27, 2001 8:26 PM
To:	Kean, Steven J.; Kingerski, Harry; Belden, Tim; Sharp, Vicki; Blachman, Jeremy; Comnes, Alan; Tribolet, Michael; Walsh, Kristin; Delainey, David; Leff, Dan; Frazier, Lamar; Keeney, Kevin; Blachman, Jeremy; Gahn, Scott; Belden, Tim; Swain, Steve; Lavorato, John; Kaufman, Paul; Steffes, James D.; Calger, Christopher F.; Mara, Susan; Black, Don; Richter, Jeff; Kitchen, Louise; Dietrich, Janet; Mara, Susan; Robertson, Linda; Kingerski, Harry; Denne, Karen; Palmer, Mark A. (PR); Shapiro, Richard; Curry, Wanda; Mellencamp, Lisa
Subject:	California Update--08.27.01

The California PUC
Loretta Lynch held a press conference in Sacramento today to discuss changes to the Commission's previously released proposal regarding Direct Access and the rate agreement between the PUC and DWR.
In the amended proposal discussed and distributed today, Direct Access would end retroactive to July 1.  Customers with contracts executed as of July 1 would would remain Direct Access customers.

The Legislature
The Assembly version of the Senate MOU (SB 78) has not yet been reviewed and voted on in the Committee.
It is scheduled to be reviewed and voted on at 6:30 PM PDT today.
Amendments on Direct Access were released this afternoon (based on negotiations between Davis' office and business customers):
Customers who have consistently been DA since May 2000, including those "involuntarily" returned to bundled service, would be exempt from charges for Edison's undercollection, DWR's forward contracts, and DWR-related exit fees, provided that the PUC finds that no additional stranded costs are created for Edison's remaining customers.
Customers who have consistently been on DA between May 2000 and Jan 17, 2001 would be exempt from charges for Edison's undercollection, DWR's forward contracts and DWR-realted exit fees, provided that the PUC finds that no additional stranded costs are created for Edison's remaining customers.
Customers who have been on DA between Jan 17, 2001 and August 24, 2001 would be exempt from exit fees related to DWR forward contracts, provided that the PUC finds that no additional stranded costs are created for Edison's remaining customers.
Customer's leaving after August 24th would not qualify for exemptions.
There is considerable work underway to make the August 24th date the deadline for contract execution, rather than the date by which the customer must be DASR'd, in order to qualify for the exemptions.
Direct Access would not be suspended, however, until 90 days after the bill is signed by Davis (if he signs it), i.e., the "effective date" of the bill.
So anyone going to Direct Access between Aug 24 and the effective date would not qualify for any exemptions.
After the 90-day period, DA would be suspended until 1.1.03.
Self-gen in service consistently from May 200 to August 24 would be exempt from Edison's undercollection and DWR charges.
Self-gen that submitted an application to the Energy Commission by August 24 would be exempt from DWR charges beginning the date that the self-gen comes on line.
Self-gen that comes on line after August 24 would be exempt from DWR charges beginning the date that the self-gen comes on line, but the total number of exempt MWs in this category would be limited to 250 MWs per year, on a first-come-first-serve basis.
At least 30% of any increases in net short due to increases in demand would be reserved for self gen.