Calif Regulators Ask Utils For Extensive Financial Info
By Mark Golden
? 
10/12/2000 
Dow Jones Energy Service 
(Copyright (c) 2000, Dow Jones & Company, Inc.) 
NEW YORK -(Dow Jones)- The California Public Utilities Commission has 
requested extensive financial information from the state's three 
investor-owned utilities and their parent companies. 
Administrative law judge Angela Minkin ruled the information should be given 
in response to a pleading by PG&E Corp. (PCG) and Edison International (EIX), 
which want the PUC to change deregulation rules to allow them to recover the 
enormous losses they are now incurring in wholesale electricity markets. 
"Minkin has directed the utilities by Oct. 17 to go open-kimono with all of 
their financial data since 1998 and, in some cases, since 1997," said Daniel 
Douglass, a partner in the law firm Arter & Hadden LLP, which is representing 
most of the state's independent power producers, the California Power 
Exchange and some of nonutility retail electricity providers in the 
proceedings. 
The judge's request covers numerous revenue accounts, asset values of power 
plants still owned by the utilities, documents on assets transferred and 
significant payments made from the regulated utilities to unregulated 
subsidiaries, bond information, and net earnings for the parent companies and 
all subsidiaries for each quarter between 1997 and 2000. 
Minkin also requested an itemization of funds paid to and amounts billed by 
any entity other than the California ISO, the state's grid operator, and the 
California PX, the state's power exchange, for power purchased in California 
by the utilities and their affiliates. 
In addition, the judge wants a description of all utility affiliates' 
activities in California electric markets and signed affidavits by the 
utilities' officers attesting to the veracity of the information. 
"The information will also permit the Commission to evaluate recent claims to 
investors and the media by PG&E and Edison that their power purchase 
liabilities have undermined their financial integrity," Minkin wrote in the 
ruling. "The seriousness of these claims imposes a responsibility on 
regulators to fully evaluate the utilities' financial circumstances on behalf 
of utility customers and the state." 
A combination of surging wholesale power prices and caps on retail rates has 
produced billions of dollars losses at Pacific Gas & Electric and Southern 
California Edison, the regulated units of PG&E and Edison International. 
The utilities want the ability to recover those losses after the transition 
to deregulation and its fixed-rate regime end in 2002. 
Failure to supply the information could result in fines, Minkin wrote. 
It would also likely jeopardize the utilties' chance of succeeding in getting 
the rules changed, Western Power Trading Forum's Douglass said. 
"If the utilities want to have these decisions modified, they need to 
document the financial straits they're in," Douglass said. "If they don't 
provide, they open up themselves up to losing their request." 
The extensiveness of the disclosures is similar to that in the subpoenas 
issued to many Western Power Trading Forum member companies in other 
investigations of California's wholesale power market. Douglass said the 
information would be available to all parties to the proceedings. 
Douglass said the utilities haven't yet objected to the ruling, which was 
issued late Friday. 
Southern California Edison declined to comment Thursday. 
   -By Mark Golden, Dow Jones Newswires; 201-938-4604;
mark.golden@dowjones.com