You may recall that PG&E files an advice letter on 11/22 to revise all  its 
tariffs because the rate freeze had purportedly ended.? The attached  letter 
from Paul Clanon shoots down that theory.? He writes that:
?
"AL 2057-E is not compliant because, at a minimum:
?
1. The rate freeze for PG&E is not over.? Pursuant to O.P. 2 of  D.99-10-057, 
the end of the rate freeze for PG&E and Southern California  Edison shall not 
occur before the generation assets of each utility have been  market valued 
except as the law or the Commission determines otherwise.?  The Commission 
has not ordered that the rate freeze can end based on the  estimated market 
value of PG&E's generation assets.
2. As PG&E  acknowledges in AL 2057-E, it is required (by O.P. 1 in 
D.99-10-057) to file an  advice letter three months prior to the earliest 
forecasted date, and an advice  letter five days after, the rate freeze 
ends.? PG&E cannot, by  unilateral action, collapse these two filings into 
one without review and an  order of the Commission authorizing such a 
modification. [NOTE:? This  is?similar to?what we said in our RAP response to 
Edison's motion to  sever the PX Credit issue from the RAP proceeding.]
3. As PG&E  acknowledges, the proposed Distribution Revenue Adjustment 
Mechanism (DRAM), and  the new rate component associated with the DRAM, were 
not authorized by  D.99-10-057, which contemplated that PG&E would be 
operating under a  Performance Based Ratemaking mechanism after the rate 
freeze ended, or by  subsequent decisions.
4. The proposed Unrecovered Cost of Service Account  (UCSA), and the new rate 
component associated with the UCSA, were not authorized  by D.99-10-057 and 
are not in compliance with any Commission decision.? To  the extent that PG&E 
proposes to transfer TRA undercollections incurred  prior to the end of the 
rate freeze to the UCSA, AL2057-E violates D.99-10-057,  O.P. 2 and 
D.00-03-058.
5. The treatment of retained generation revenues  proposed in this AL was not 
authorized by D.99-10-057, or by subsequent  decisions."
?
Whoopee!
?
Dan
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From: "Avendano, Nel C" <NCO1@pge.com>
To: "Antonio, Sonny" <IUCGroup@email.com>, "Avendano, Nel" <nco1@pge.com>,   
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<william.stancer@ipaper.com>,   "Stanford, Charlene" 
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<LSturdevant@sempra-slns.com>,   "Tachera, Jennifer" 
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cc: "Malekos, Shelly" <SSM3@pge.com>, "Shaw, Susan" <SXS9@pge.com>,   "Smith, 
Anita (RegRel)" <AWS4@pge.com>
Subject: PG&E Advice Letter 2057-E
Date: Tue, 5 Dec 2000 14:08:16 -0800
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Attached for your information is a letter dated December 4,  2000,  from
Paul Clanon of Energy Division regarding the status of AL 2057-E filed by
PG&E Company on November 22,  2000.

 <<2057-E_EDletter.doc>>



Thank You,
Nel Avendano (nco1)
Rates (3-3529)


 - 2057-E_EDletter.doc