edmund g. brown jr., governor public utilities … · 2013-04-02 · state of california edmund g....

STATE OF CALIFORNIA EDMUND G. BROWN JR., Governor PUBLIC UTILITIES COMMISSION 505 VAN NESS AVENUE

SAN FRANCISCO, CA 94102-3298

March 29, 2013 Agenda ID #12039 Ratesetting TO PARTIES OF RECORD IN APPLICATION (A.) 10-12-005 AND A.10-12-006 This is the proposed decision of Administrative Law Judge (ALJ) John S. Wong previously designated as the presiding officer in this proceeding. It will not appear on the Commission’s agenda sooner than 30 days from the date it is mailed. This matter was categorized as ratesetting and is subject to Pub. Util. Code § 1701.3(c). Upon the request of any Commissioner, a Ratesetting Deliberative Meeting (RDM) may be held. If that occurs, the Commission will prepare and publish an agenda for the RDM 10 days beforehand. When the RDM is held, there is a related ex parte communications prohibition period. (See Rule 8.3(c)(4).) When the Commission acts on the proposed decision, it may adopt all or part of it as written, amend or modify it, or set it aside and prepare its own decision. Only when the Commission acts does the decision become binding on the parties. Parties to the proceeding may file comments on the proposed decision as provided in Article 14 of the Commission’s Rules of Practice and Procedure (Rules), accessible on the Commission’s website at www.cpuc.ca.gov. Pursuant to Rule 14.3, opening comments shall not exceed 25 pages. Comments must be filed pursuant to Rule 1.13 either electronically or in hard copy. Comments should be served on parties to this proceeding in accordance with Rules 1.9 and 1.10. Electronic and hard copies of comments should be sent to ALJ Wong at [email protected] and assigned Commissioner. The current service list for this proceeding is available on the Commission’s website at www.cpuc.ca.gov. /s/ MARYAM EBKE for Karen V. Clopton, Chief Administrative Law Judge KVC:JT2/avs Attachment

F I L E D03-29-1302:35 PM

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ALJ/JSW/JT2/avs PROPOSED DECISION Agenda ID #12039 Ratesetting Decision PROPOSED DECISION OF ALJ WONG (Mailed 3/29/2013) BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA Application of San Diego Gas & Electric Company (U902M) for Authority, Among Other Things, to Increase Rates and Charges for Electric and Gas Service Effective on January 1, 2012.

Application 10-12-005

(Filed December 15, 2010)

And Related Matter.

Application 10-12-006

DECISION ON GENERAL RATE CASES OF SAN DIEGO GAS & ELECTRIC COMPANY AND

SOUTHERN CALIFORNIA GAS COMPANY

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IC ...... 1 ...... 2 ...... 5 ...... 7 ...... 7 ...... 9 .... 10 .... 10 .... 12 .... 13 ... 13 ... 14 .... 14 .... 15 .... 18 .... 20 .... 24 .... 24 .... 24 ... 24 ... 27 .... 27 .... 28 ... 30 .... 30 .... 31 .... 32 .... 35 .... 36 .... 37 .... 37 .... 37 ... 37 ... 39

A.10-12-005 A.10-12-006 ALJ/JSW/ jt2/avs PROPOSED DECISION

TABLE OF CONTENTS (cont.)

Title Page

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5.3.2.1. DRA .................................................................................................... 39 5.3.2.2. SoCalGas ............................................................................................ 39

5.3.3. Discussion .................................................................................. 40 5.4. SDG&E Non-Nuclear Electric Generation ............................................ 40

5.4.1. Introduction .............................................................................. 40 5.4.2. O&M Costs ................................................................................ 42

5.4.2.1. Introduction ...................................................................................... 42 5.4.2.2. Position of the Parties ...................................................................... 42 5.4.2.2.1. DRA ................................................................................................. 42 5.4.2.2.2. UCAN .............................................................................................. 44 5.4.2.2.3. SDG&E ............................................................................................ 45 5.4.2.3. Discussion ......................................................................................... 46

5.4.3. Capital Expenditures ............................................................... 51 5.4.3.1. Introduction ...................................................................................... 51 5.4.3.2. Position of the Parties ...................................................................... 52 5.4.3.2.1. DRA ................................................................................................. 52 5.4.3.2.2. UCAN .............................................................................................. 55 5.4.3.2.3. SDG&E ............................................................................................ 57 5.4.3.3. Discussion ......................................................................................... 61 5.4.3.3.1. Miramar Plant Operational Enhancements ............................... 61 5.4.3.3.2. Palomar Plant Operational Enhancements ................................ 62 5.4.3.3.3. Summary of Capital Expenditures ............................................. 71

6. San Onofre Nuclear Generating Station (SONGS) ......................................... 71 6.1. Introduction ............................................................................................... 71 6.2. Position of the Parties .............................................................................. 73

6.2.1. DRA ............................................................................................ 73 6.2.2. Joint Parties ............................................................................... 75 6.2.3. UCAN ........................................................................................ 75 6.2.4. SDG&E ....................................................................................... 76

6.3. Discussion .................................................................................................. 77 7. SDG&E Electric Distribution Operations ......................................................... 80

7.1. Introduction ............................................................................................... 80 7.2. O&M Costs ................................................................................................ 81

7.2.1. Introduction .............................................................................. 81



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7.2.2. Electric Regional Operations (ERO) ...................................... 82 7.2.2.1. Introduction ...................................................................................... 82 7.2.2.2. Position of the Parties ...................................................................... 85 7.2.2.2.1. DRA ................................................................................................. 85 7.2.2.2.2. UCAN .............................................................................................. 87 7.2.2.2.3. Coalition of California Utility Employees (CCUE) .................. 88 7.2.2.2.4. SDG&E ............................................................................................ 88 7.2.2.3. Discussion ......................................................................................... 90 7.2.2.3.1. Fire Hazard Prevention ................................................................ 90 7.2.2.3.2. Safety Culture Change .................................................................. 93 7.2.2.3.3. EPA and PCBs ................................................................................ 93 7.2.2.3.4. Climbing Gear ................................................................................ 94 7.2.2.3.5. OpEx Pathing Changes ................................................................. 95 7.2.2.3.6. RIRAT .............................................................................................. 95 7.2.2.3.7. OpEx On-Going Support .............................................................. 96 7.2.2.3.8. Area Resource Scheduling Organization (ARSO) .................... 97 7.2.2.3.9. Impact of Plug-In Electric Vehicles (PEVs) ................................ 98 7.2.2.3.10. Vacation and Sick Leave ............................................................... 99 7.2.2.3.11. Smart Grid ...................................................................................... 99

7.2.3. ERO (Troubleshooting/Engineering) ................................... 99 7.2.3.1. Introduction ...................................................................................... 99 7.2.3.2. Position of the Parties .................................................................... 101 7.2.3.2.1. DRA ............................................................................................... 101 7.2.3.2.2. UCAN ............................................................................................ 101 7.2.3.2.3. SDG&E .......................................................................................... 102 7.2.3.3. Discussion ....................................................................................... 102

7.2.4. Skills and Compliance Training ........................................... 103 7.2.4.1. Introduction .................................................................................... 103 7.2.4.2. Position of the Parties .................................................................... 104 7.2.4.2.1. DRA ............................................................................................... 104 7.2.4.2.2. UCAN ............................................................................................ 105 7.2.4.2.3. SDG&E .......................................................................................... 105 7.2.4.3. Discussion ....................................................................................... 106

7.2.5. Project Management .............................................................. 107



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7.2.5.1. Introduction .................................................................................... 107 7.2.5.2. Position of the Parties .................................................................... 109 7.2.5.2.1. DRA ............................................................................................... 109 7.2.5.2.2. UCAN ............................................................................................ 109 7.2.5.2.3. SDG&E .......................................................................................... 110 7.2.5.3. Discussion ....................................................................................... 111

7.2.6. Service Order Team ............................................................... 112 7.2.6.1. Introduction .................................................................................... 112 7.2.6.2. Position of the Parties .................................................................... 113 7.2.6.2.1. DRA ............................................................................................... 113 7.2.6.2.2. SDG&E .......................................................................................... 113 7.2.6.3. Discussion ....................................................................................... 113

7.2.7. Regional Public Affairs .......................................................... 113 7.2.7.1. Introduction .................................................................................... 113 7.2.7.2. Position of the Parties .................................................................... 115 7.2.7.2.1. DRA ............................................................................................... 115 7.2.7.2.2. UCAN ............................................................................................ 115 7.2.7.2.3. SDG&E .......................................................................................... 117 7.2.7.3. Discussion ....................................................................................... 117

7.2.8. Grid Operations ...................................................................... 121 7.2.8.1. Introduction .................................................................................... 121 7.2.8.2. Position of the Parties .................................................................... 122 7.2.8.2.1. DRA ............................................................................................... 122 7.2.8.2.2. UCAN ............................................................................................ 122 7.2.8.2.3. SDG&E .......................................................................................... 123 7.2.8.3. Discussion ....................................................................................... 123

7.2.9. Substation Construction and Maintenance ........................ 124 7.2.9.1. Introduction .................................................................................... 124 7.2.9.2. Position of the Parties .................................................................... 125 7.2.9.2.1. DRA ............................................................................................... 125 7.2.9.2.2. UCAN ............................................................................................ 126 7.2.9.2.3. SDG&E .......................................................................................... 126 7.2.9.3. Discussion ....................................................................................... 127

7.2.10. System Protection ................................................................... 131



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7.2.11. Electric Distribution Operations .......................................... 134 7.2.11.1. Introduction .................................................................................... 134 7.2.11.2. Position of the Parties .................................................................... 135 7.2.11.2.1. DRA ............................................................................................... 135 7.2.11.2.2. UCAN ............................................................................................ 135 7.2.11.2.3. SDG&E .......................................................................................... 136 7.2.11.3. Discussion ....................................................................................... 137

7.2.12. Distribution Operations/Electric Geographic Information Management ........................................................................... 138


7.2.13. Equipment Maintenance and Lab ........................................ 140 7.2.13.1. Introduction .................................................................................... 140 7.2.13.2. Position of the Parties .................................................................... 141 7.2.13.2.1. DRA ............................................................................................... 141 7.2.13.2.2. UCAN ............................................................................................ 142 7.2.13.2.3. SDG&E .......................................................................................... 142 7.2.13.3. Discussion ....................................................................................... 142

7.2.14. Construction Services ............................................................ 143 7.2.14.1. Introduction .................................................................................... 143 7.2.14.2. Position of the Parties .................................................................... 144 7.2.14.2.1. DRA ............................................................................................... 144 7.2.14.2.2. UCAN ............................................................................................ 144 7.2.14.2.3. SDG&E .......................................................................................... 144



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7.2.14.3. Discussion ....................................................................................... 145 7.2.15. Vegetation Management ....................................................... 146

7.2.15.1. Introduction .................................................................................... 146 7.2.15.2. Tree Trimming ................................................................................ 147 7.2.15.2.1. Introduction .................................................................................. 147 7.2.15.2.2. Position of the Parties ................................................................. 148 7.2.15.2.2.1. DRA ........................................................................................... 148 7.2.15.2.2.2. FEA ............................................................................................ 148 7.2.15.2.2.3. UCAN ....................................................................................... 149 7.2.15.2.2.4. CCUE ......................................................................................... 149 7.2.15.2.2.5. SDG&E ...................................................................................... 150 7.2.15.2.3. Discussion ..................................................................................... 151 7.2.15.3. Pole Brushing .................................................................................. 152 7.2.15.3.1. Introduction .................................................................................. 152 7.2.15.3.2. Position of the Parties ................................................................. 153 7.2.15.3.2.1. DRA ........................................................................................... 153 7.2.15.3.2.2. FEA ............................................................................................ 153 7.2.15.3.2.3. UCAN ....................................................................................... 154 7.2.15.3.2.4. SDG&E ...................................................................................... 154 7.2.15.3.3. Discussion ..................................................................................... 154

7.2.16. Asset Management ................................................................. 155 7.2.16.1. Introduction .................................................................................... 155 7.2.16.2. Position of the Parties .................................................................... 157 7.2.16.2.1. DRA ............................................................................................... 157 7.2.16.2.2. UCAN ............................................................................................ 158 7.2.16.2.3. SDG&E .......................................................................................... 159 7.2.16.3. Discussion ....................................................................................... 160

7.2.17. Distribution Engineering ...................................................... 164 7.2.17.1. Introduction .................................................................................... 164 7.2.17.2. Position of the Parties .................................................................... 165 7.2.17.2.1. UCAN ............................................................................................ 165 7.2.17.2.2. SDG&E .......................................................................................... 165 7.2.17.3. Discussion ....................................................................................... 165

7.2.18. Officer....................................................................................... 165



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7.2.19. Administrative and Management ........................................ 166 7.2.20. Miscellaneous Costs ............................................................... 166

7.3. Capital Expenditures ............................................................................. 166 7.3.1. Introduction ............................................................................ 166

7.3.1.1. Position of the Other Parties ......................................................... 168 7.3.1.1.1. DRA ............................................................................................... 168 7.3.1.1.2. FEA ................................................................................................ 169 7.3.1.1.3. UCAN ............................................................................................ 170 7.3.1.1.4. CCUE ............................................................................................. 170 7.3.1.1.5. SDG&E .......................................................................................... 171

7.3.2. New Business Category ........................................................ 171 7.3.2.1. Introduction .................................................................................... 171 7.3.2.2. Position of the Parties .................................................................... 174 7.3.2.2.1. DRA ............................................................................................... 174 7.3.2.2.2. FEA ................................................................................................ 174 7.3.2.2.3. UCAN ............................................................................................ 175 7.3.2.2.4. SDG&E .......................................................................................... 176 7.3.2.3. Discussion ....................................................................................... 177

7.3.3. Capacity Category .................................................................. 181 7.3.3.1. Introduction .................................................................................... 181 7.3.3.2. Position of the Parties .................................................................... 182 7.3.3.2.1. DRA ............................................................................................... 182 7.3.3.2.2. FEA ................................................................................................ 182 7.3.3.2.3. SDG&E .......................................................................................... 182 7.3.3.2.4. Discussion ..................................................................................... 183

7.3.4. Reliability Category ............................................................... 184 7.3.4.1. Introduction .................................................................................... 184 7.3.4.2. Position of the Parties .................................................................... 185 7.3.4.2.1. DRA ............................................................................................... 185 7.3.4.2.2. FEA ................................................................................................ 185 7.3.4.2.3. UCAN ............................................................................................ 185 7.3.4.2.4. CCUE ............................................................................................. 186 7.3.4.2.5. SDG&E .......................................................................................... 187 7.3.4.3. Discussion ....................................................................................... 188



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7.3.5. Mandated Category ............................................................... 189 7.3.5.1. Introduction .................................................................................... 189 7.3.5.2. Position of the Parties .................................................................... 190 7.3.5.2.1. DRA ............................................................................................... 190 7.3.5.2.2. FEA ................................................................................................ 190 7.3.5.2.3. UCAN ............................................................................................ 191 7.3.5.2.4. SDG&E .......................................................................................... 192 7.3.5.3. Discussion ....................................................................................... 193

7.3.6. Franchise Category ................................................................ 193 7.3.6.1. Introduction .................................................................................... 193 7.3.6.2. Position of the Parties .................................................................... 194 7.3.6.2.1. DRA ............................................................................................... 194 7.3.6.2.2. FEA ................................................................................................ 194 7.3.6.2.3. UCAN ............................................................................................ 194 7.3.6.2.4. SDG&E .......................................................................................... 194 7.3.6.2.5. Discussion ..................................................................................... 195

7.3.7. Fire Hardening Specifics and AMI Category ..................... 195 7.3.7.1. Introduction .................................................................................... 195 7.3.7.2. Position of the Parties .................................................................... 196 7.3.7.2.1. DRA ............................................................................................... 196 7.3.7.2.2. FEA ................................................................................................ 196 7.3.7.2.3. UCAN ............................................................................................ 196 7.3.7.2.4. SDG&E .......................................................................................... 197 7.3.7.3. Discussion ....................................................................................... 198

7.3.8. Reliability Incentives ............................................................. 199 7.3.8.1. CCUE Proposal ............................................................................... 199 7.3.8.2. Position of the Other Parties ......................................................... 202 7.3.8.2.1. UCAN ............................................................................................ 202 7.3.8.2.2. SDG&E .......................................................................................... 202 7.3.8.3. Discussion ....................................................................................... 203 7.4. Smart Grid ............................................................................................... 207

7.4.1. Introduction ............................................................................ 207 7.4.1.1. O&M Costs ...................................................................................... 207 7.4.1.2. Capital Projects ............................................................................... 208



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7.4.2. Position of the Parties ............................................................ 212 7.4.2.1. DRA .................................................................................................. 212 7.4.2.2. FEA ................................................................................................... 215 7.4.2.3. UCAN .............................................................................................. 216 7.4.2.4. SDG&E ............................................................................................. 220

7.4.3. Discussion ................................................................................ 222 8. Gas Distribution ................................................................................................. 231

8.1. Introduction ............................................................................................. 231 8.2. SDG&E ..................................................................................................... 233

8.2.1. Introduction ............................................................................ 233 8.2.2. O&M Costs .............................................................................. 233

8.2.2.1. Introduction .................................................................................... 233 8.2.2.2. O&M Non-Shared Services ........................................................... 234 8.2.2.2.1. Introduction .................................................................................. 234 8.2.2.2.2. Field Operations and Maintenance ........................................... 234 8.2.2.2.2.1. Introduction ............................................................................. 234 8.2.2.2.2.2. Position of the Parties ............................................................. 239 8.2.2.2.2.2.1. DRA ........................................................................................... 239 8.2.2.2.2.2.2. UCAN ................................................................................ 240 8.2.2.2.2.2.3. SDG&E ............................................................................... 242 8.2.2.2.2.3. Discussion ................................................................................. 244 8.2.2.2.3. Asset Management ...................................................................... 249 8.2.2.2.3.1. Introduction ............................................................................. 249 8.2.2.2.3.2. Position of the Parties ............................................................. 250 8.2.2.2.3.2.1. DRA .................................................................................... 250 8.2.2.2.3.2.2. UCAN ................................................................................ 250 8.2.2.2.3.2.3. SDG&E ............................................................................... 251 8.2.2.2.3.3. Discussion ................................................................................. 252 8.2.2.2.4. Operations Management and Training .................................... 252 8.2.2.2.4.1. Introduction ............................................................................. 252 8.2.2.2.4.2. Position of the Parties ............................................................. 253 8.2.2.2.4.2.1. DRA .................................................................................... 253 8.2.2.2.4.2.2. UCAN ................................................................................ 253 8.2.2.2.4.2.3. SDG&E ............................................................................... 253



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8.2.2.2.4.3. Discussion ................................................................................. 254 8.2.2.3. O&M Shared Services .................................................................... 254

8.2.3. Capital Expenditures ............................................................. 255 8.2.3.1. Introduction .................................................................................... 255 8.2.3.2. New Business .................................................................................. 257 8.2.3.2.1. Introduction .................................................................................. 257 8.2.3.2.2. Position of the Parties ................................................................. 257 8.2.3.2.2.1. DRA ........................................................................................... 257 8.2.3.2.2.2. UCAN ....................................................................................... 257 8.2.3.2.2.3. SDG&E ...................................................................................... 258 8.2.3.2.3. Discussion ..................................................................................... 259 8.2.3.3. System Minor Additions, Relocations and Retirements .......... 260 8.2.3.3.1. Introduction .................................................................................. 260 8.2.3.3.2. Position of the Parties ................................................................. 260 8.2.3.3.2.1. DRA ........................................................................................... 260 8.2.3.3.2.2. SDG&E ...................................................................................... 260 8.2.3.3.3. Discussion ..................................................................................... 261 8.2.3.4. Meter and Regulator Materials .................................................... 261 8.2.3.4.1. Introduction .................................................................................. 261 8.2.3.4.2. Position of the Parties ................................................................. 261 8.2.3.4.2.1. DRA ........................................................................................... 261 8.2.3.4.2.2. UCAN ....................................................................................... 261 8.2.3.4.2.3. SDG&E ...................................................................................... 262 8.2.3.4.3. Discussion ..................................................................................... 262 8.2.3.5. Pressure Betterment ....................................................................... 263 8.2.3.5.1. Introduction .................................................................................. 263 8.2.3.5.2. Position of the Parties ................................................................. 263 8.2.3.5.2.1. DRA ........................................................................................... 263 8.2.3.5.2.2. SDG&E ...................................................................................... 263 8.2.3.5.3. Discussion ..................................................................................... 264 8.2.3.6. Distribution Easements ................................................................. 264 8.2.3.6.1. Introduction .................................................................................. 264 8.2.3.6.2. Position of the Parties ................................................................. 264 8.2.3.6.2.1. DRA ........................................................................................... 264



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8.2.3.6.2.2. SDG&E ...................................................................................... 264 8.2.3.6.3. Discussion ..................................................................................... 265 8.2.3.7. Pipe Relocation – Franchise and Freeway .................................. 265 8.2.3.7.1. Introduction .................................................................................. 265 8.2.3.7.2. Position of the Parties ................................................................. 265 8.2.3.7.2.1. DRA ........................................................................................... 265 8.2.3.7.2.2. UCAN ....................................................................................... 266 8.2.3.7.2.3. SDG&E ...................................................................................... 266 8.2.3.7.3. Discussion ..................................................................................... 266 8.2.3.8. Tools & Equipment ........................................................................ 267 8.2.3.8.1. Introduction .................................................................................. 267 8.2.3.8.2. Position of the Parties ................................................................. 267 8.2.3.8.2.1. DRA ........................................................................................... 267 8.2.3.8.2.2. SDG&E ...................................................................................... 268 8.2.3.8.3. Discussion ..................................................................................... 268 8.2.3.9. Code Compliance ........................................................................... 268 8.2.3.9.1. Introduction .................................................................................. 268 8.2.3.9.2. Position of the Parties ................................................................. 269 8.2.3.9.2.1. DRA ........................................................................................... 269 8.2.3.9.2.2. SDG&E ...................................................................................... 269 8.2.3.9.3. Discussion ..................................................................................... 269 8.2.3.10. Replacement of Mains & Services ................................................ 269 8.2.3.10.1. Introduction .................................................................................. 269 8.2.3.10.2. Position of the Parties ................................................................. 270 8.2.3.10.2.1. DRA ........................................................................................... 270 8.2.3.10.2.2. SDG&E ...................................................................................... 270 8.2.3.10.3. Discussion ..................................................................................... 270 8.2.3.11. Cathodic Protection ....................................................................... 271 8.2.3.11.1. Introduction .................................................................................. 271 8.2.3.11.2. Position of the Parties ................................................................. 271 8.2.3.11.2.1. DRA ........................................................................................... 271 8.2.3.11.2.2. UCAN ....................................................................................... 271 8.2.3.11.2.3. SDG&E ...................................................................................... 272 8.2.2.15.3. Discussion ..................................................................................... 272



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8.2.3.12. Regulator Station Improvements ................................................. 272 8.2.3.12.1. Introduction .................................................................................. 272 8.2.3.12.2. Position of the Parties ................................................................. 273 8.2.3.12.2.1. DRA ........................................................................................... 273 8.2.3.12.2.2. SDG&E ...................................................................................... 273 8.2.3.12.3. Discussion ..................................................................................... 273 8.2.3.13. Local Engineering .......................................................................... 274 8.2.3.13.1. Introduction .................................................................................. 274 8.2.3.13.2. Position of the Parties ................................................................. 274 8.2.3.13.2.1. DRA ........................................................................................... 274 8.2.3.13.2.2. UCAN ....................................................................................... 275 8.2.3.13.2.3. SDG&E ...................................................................................... 275 8.2.3.13.3. Discussion ..................................................................................... 275 8.2.3.14. Camp Pendleton – San Onofre 1 .................................................. 275 8.2.3.14.1. Introduction .................................................................................. 275 8.2.3.15. Smart Meter Project ....................................................................... 276 8.2.3.15.1. Introduction .................................................................................. 276 8.2.3.15.2. Position of the Parties ................................................................. 276 8.2.3.15.2.1. DRA ........................................................................................... 276 8.2.3.15.2.2. SDG&E ...................................................................................... 276 8.2.3.15.3. Discussion ..................................................................................... 277 8.3. SoCalGas .................................................................................................. 277

8.3.1. Introduction ............................................................................ 277 8.3.2. O&M Costs .............................................................................. 278

8.3.2.1. Introduction .................................................................................... 278 8.3.2.2. O&M Non-Shared Services ........................................................... 278 8.3.2.2.1. Introduction .................................................................................. 278 8.3.2.2.2. Field Operations and Maintenance ........................................... 279 8.3.2.2.2.1. Introduction ............................................................................. 279 8.3.2.2.2.2. Position of the Parties ............................................................. 282 8.3.2.2.2.2.1. DRA .................................................................................... 282 8.3.2.2.2.2.2. TURN ................................................................................. 285 8.3.2.2.2.2.3. SoCalGas ............................................................................ 287 8.3.2.2.2.3. Discussion ................................................................................. 293



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8.3.2.2.3. Asset Management ...................................................................... 298 8.3.2.2.3.1. Introduction ............................................................................. 298 8.3.2.2.3.2. Position of the Parties ............................................................. 299 8.3.2.2.3.2.1. DRA .................................................................................... 299 8.3.2.2.3.2.2. TURN ................................................................................. 300 8.3.2.2.3.2.2.1. SoCalGas ............................................................................ 300 8.3.2.2.3.3. Discussion ................................................................................. 301 8.3.2.2.4. Operations Management and Training .................................... 302 8.3.2.2.4.1. Introduction ............................................................................. 302 8.3.2.2.4.2. Position of the Parties ............................................................. 302 8.3.2.2.4.2.1. DRA .................................................................................... 302 8.3.2.2.4.2.2. SoCalGas ............................................................................ 303 8.3.2.2.4.3. Discussion ................................................................................. 305 8.3.2.2.5. Regional Public Affairs ............................................................... 306 8.3.2.2.5.1. Introduction ............................................................................. 306 8.3.2.2.5.2. Position of the Parties ............................................................. 306 8.3.2.2.5.2.1. TURN ................................................................................. 306 8.3.2.2.5.2.2. SoCalGas ............................................................................ 306 8.3.2.2.5.3. Discussion ................................................................................. 307 8.3.2.3. O&M Shared Services .................................................................... 308

8.3.3. Capital Expenditures ............................................................. 309 8.3.3.1. Introduction .................................................................................... 309 8.3.3.2. New Business .................................................................................. 310 8.3.3.2.1. Introduction .................................................................................. 310 8.3.3.2.2. Position of the Parties ................................................................. 311 8.3.3.2.2.1. DRA ........................................................................................... 311 8.3.3.2.2.2. TURN ........................................................................................ 312 8.3.3.2.2.3. SoCalGas ................................................................................... 313 8.3.3.2.3. Discussion ..................................................................................... 315 8.3.3.3. Pressure Betterment Projects ........................................................ 316 8.3.3.3.3. Introduction .................................................................................. 316 8.3.3.3.1. Position of the Parties ................................................................. 316 8.3.3.3.1.1. DRA ........................................................................................... 316 8.3.3.3.1.2. TURN ........................................................................................ 316



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8.3.3.3.1.3. SoCalGas ................................................................................... 317 8.3.3.3.4. Discussion ..................................................................................... 318 8.3.3.4. Supply Line Replacements ........................................................... 318 8.3.3.4.3. Introduction .................................................................................. 318 8.3.3.4.2. Position of the Parties ................................................................. 319 8.3.3.4.2.1. DRA ........................................................................................... 319 8.3.3.4.2.2. TURN ........................................................................................ 319 8.3.3.4.2.3. SoCalGas ................................................................................... 319 8.3.3.4.3. Discussion ..................................................................................... 320 8.3.3.5. Main Replacements ........................................................................ 320 8.3.3.5.1. Introduction .................................................................................. 320 8.3.3.5.2. Position of the Parties ................................................................. 320 8.3.3.5.2.1. DRA ........................................................................................... 320 8.3.3.5.2.2. TURN ........................................................................................ 321 8.3.3.5.2.3. SoCalGas ................................................................................... 321 8.3.3.5.3. Discussion ..................................................................................... 321 8.3.3.6. Service Replacements .................................................................... 321 8.3.3.6.1. Introduction .................................................................................. 321 8.3.3.6.2. Position of the Parties ................................................................. 322 8.3.3.6.2.1. DRA ........................................................................................... 322 8.3.3.6.2.2. TURN ........................................................................................ 322 8.3.3.6.2.3. SoCalGas ................................................................................... 322 8.3.3.6.3. Discussion ..................................................................................... 322 8.3.3.7. Main and Service Abandonments ............................................... 323 8.3.3.7.3. Introduction .................................................................................. 323 8.3.3.7.2. Position of the Parties ................................................................. 323 8.3.3.7.2.1. DRA ........................................................................................... 323 8.3.3.7.2.2. TURN ........................................................................................ 323 8.3.3.7.2.3. SoCalGas ................................................................................... 323 8.3.3.7.4. Discussion ..................................................................................... 324 8.3.3.8. Regulator Station Projects ............................................................. 324 8.3.3.8.3. Introduction .................................................................................. 324 8.3.3.8.2. Position of the Parties ................................................................. 325 8.3.3.8.2.1. DRA ........................................................................................... 325



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8.3.3.8.2.2. TURN ........................................................................................ 325 8.3.3.8.2.3. SoCalGas ................................................................................... 325 8.3.3.8.3. Discussion ..................................................................................... 326 8.3.3.9. Cathodic Protection ....................................................................... 326 8.3.3.9.1. Introduction .................................................................................. 326 8.3.3.9.2. Position of the Parties ................................................................. 327 8.3.3.9.2.1. DRA ........................................................................................... 327 8.3.3.9.2.2. TURN ........................................................................................ 327 8.3.3.9.2.3. SoCalGas ................................................................................... 327 8.3.3.9.3. Discussion ..................................................................................... 328 8.3.3.10. Pipeline Relocations - Freeway .................................................... 328 8.3.3.10.1. Introduction .................................................................................. 328 8.3.3.10.2. Position of the Parties ................................................................. 329 8.3.3.10.3. Discussion ..................................................................................... 329 8.3.3.11. Pipeline Relocations-Franchise .................................................... 329 8.3.3.11.1. Introduction .................................................................................. 329 8.3.3.11.2. Position of the Parties ................................................................. 330 8.3.3.11.2.1. DRA ........................................................................................... 330 8.3.3.11.2.2. TURN ........................................................................................ 330 8.3.3.11.2.3. SoCalGas ................................................................................... 330 8.3.3.11.3. Discussion ..................................................................................... 330 8.3.3.12. Mobile Home Parks ....................................................................... 331 8.3.3.13. Other Distribution Capital Projects ............................................. 331 8.3.3.13.1. Introduction .................................................................................. 331 8.3.3.13.2. Position of the Parties ................................................................. 332 8.3.3.13.2.1. DRA ........................................................................................... 332 8.3.3.13.2.2. TURN ........................................................................................ 332 8.3.3.13.2.3. SoCalGas ................................................................................... 333 8.3.3.13.3. Discussion ..................................................................................... 333 8.3.3.14. Meters and Regulators .................................................................. 334 8.3.3.14.1. Introduction .................................................................................. 334 8.3.3.14.2. Position of the Parties ................................................................. 335 8.3.3.14.2.1. DRA ........................................................................................... 335 8.3.3.14.2.2. TURN ........................................................................................ 336



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8.3.3.14.2.3. SoCalGas ................................................................................... 336 8.3.3.14.3. Discussion ..................................................................................... 337 8.3.3.15. Equipment/Tools ........................................................................... 338 8.3.3.15.1. Introduction .................................................................................. 338 8.3.3.15.2. Position of the Parties ................................................................. 339 8.3.3.15.2.1. DRA ........................................................................................... 339 8.3.3.15.2.2. TURN ........................................................................................ 339 8.3.3.15.2.3. SoCalGas ................................................................................... 340 8.3.3.15.3. Discussion ..................................................................................... 340 8.3.3.16. Field Capital Support .................................................................... 341 8.3.3.16.1. Introduction .................................................................................. 341 8.3.3.16.2. Position of the Parties ................................................................. 342 8.3.3.16.2.1. DRA ........................................................................................... 342 8.3.3.16.2.2. TURN ........................................................................................ 342 8.3.3.16.2.3. SoCalGas ................................................................................... 342 8.3.3.17.3. Discussion ..................................................................................... 342

9. Gas Transmission ............................................................................................... 343 9.1. Introduction ............................................................................................. 343 9.2. SDG&E ..................................................................................................... 343

9.2.1. Introduction ............................................................................ 343 9.2.2. Gas Transmission O&M Costs ............................................. 346

9.2.2.1. Introduction .................................................................................... 346 9.2.2.2. Non-Shared O&M Costs ............................................................... 346 9.2.2.2.1. Introduction .................................................................................. 346 9.2.2.2.2. Pipeline O&M .............................................................................. 346 9.2.2.2.3. Compressor Station O&M .......................................................... 347 9.2.2.2.3.1. Introduction ............................................................................. 347 9.2.2.2.3.2. Position of the Parties ............................................................. 348 9.2.2.2.3.2.1. DRA .................................................................................... 348 9.2.2.2.3.2.2. SDG&E ............................................................................... 348 9.2.2.2.3.3. Discussion ................................................................................. 348 9.2.2.2.4. Transmission Technical Services ............................................... 348 9.2.2.2.4.1. Introduction ............................................................................. 348 9.2.2.3. Shared O&M Costs......................................................................... 349



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9.3. SoCalGas .................................................................................................. 349 9.3.1. Introduction ............................................................................ 349 9.3.2. Gas Transmission O&M Costs ............................................. 352

9.3.2.1. Introduction .................................................................................... 352 9.3.2.2. Non-Shared O&M Costs ............................................................... 352 9.3.2.2.1. Pipeline O&M .............................................................................. 352 9.3.2.2.1.1. Introduction ............................................................................. 352 9.3.2.2.1.2. Position of the Parties ............................................................. 353 9.3.2.2.1.2.1. DRA .................................................................................... 353 9.3.2.2.1.2.2. TURN ................................................................................. 354 9.3.2.2.1.2.3. SoCalGas ............................................................................ 355 9.3.2.2.1.3. Discussion ................................................................................. 355 9.3.2.2.2. Compressor Station O&M .......................................................... 356 9.3.2.2.2.1. Introduction ............................................................................. 356 9.3.2.2.2.2. Position of the Parties ............................................................. 357 9.3.2.2.2.2.1. DRA .................................................................................... 357 9.3.2.2.2.2.2. SoCalGas ............................................................................ 358 9.3.2.2.2.3. Discussion ................................................................................. 359 9.3.2.2.3. Technical Services ........................................................................ 360 9.3.2.2.3.1. Introduction ............................................................................. 360 9.3.2.2.3.2. Position of the Parties ............................................................. 361 9.3.2.2.3.2.1. DRA .................................................................................... 361 9.3.2.2.3.2.2. SoCalGas ............................................................................ 361 9.3.2.2.3.3. Discussion ................................................................................. 362 9.3.2.3. Shared O&M Costs......................................................................... 362

10. Gas Storage and Engineering ........................................................................... 362 10.1. Introduction ............................................................................................. 362 10.2. Gas Storage .............................................................................................. 363

10.2.1. Introduction ............................................................................ 363 10.2.2. Gas Storage O&M Costs ................................................................ 364 10.2.2.1. Introduction .................................................................................. 364 10.2.2.2. Position of the Parties ................................................................. 366 10.2.2.2.1. DRA ........................................................................................... 366 10.2.2.3. Discussion ..................................................................................... 369



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10.2.3. Gas Storage Capital Expenditures ....................................... 370 10.2.3.1. Introduction .................................................................................... 370 10.2.3.2. Compressor Stations ...................................................................... 371 10.2.3.2.2. Position of the Parties ................................................................. 371 10.2.3.2.2.1. DRA ........................................................................................... 371 10.2.3.2.2.2. SoCalGas ................................................................................... 372 10.2.3.2.3. Discussion ..................................................................................... 372 10.2.3.3. Wells ................................................................................................. 372 10.2.3.4. Pipelines........................................................................................... 374 10.2.3.4.1. Introduction .................................................................................. 374 10.2.3.4.2. Position of the Parties ................................................................. 375 10.2.3.4.2.1. DRA ........................................................................................... 375 10.2.3.4.2.2. SoCalGas ................................................................................... 376 10.2.3.4.3. Discussion ..................................................................................... 376 10.2.3.5. Purification ...................................................................................... 377 10.2.3.6. Auxiliary Equipment ..................................................................... 378 10.2.3.6.1. Introduction .................................................................................. 378 10.2.3.6.2. Position of the Parties ................................................................. 379 10.2.3.6.2.1. DRA ........................................................................................... 379 10.2.3.6.2.2. SoCalGas ................................................................................... 380 10.2.3.6.3. Discussion ..................................................................................... 380 10.3. Gas Engineering ...................................................................................... 381

10.3.1. Introduction ............................................................................ 381 10.3.2. SDG&E Gas Engineering ...................................................... 381

10.3.2.1. Introduction .................................................................................... 381 10.3.2.2. O&M Costs ...................................................................................... 383 10.3.2.2.1. Introduction .................................................................................. 383 10.3.2.2.2. Non-Shared O&M Costs ............................................................. 384 10.3.2.2.2.1. Introduction ............................................................................. 384 10.3.2.2.2.2. Gas Engineering ...................................................................... 385 10.3.2.2.2.3. Transmission Pipeline Integrity ............................................ 387 10.3.2.2.2.3.1. Introduction ...................................................................... 387 10.3.2.2.2.3.2. Position of the Parties ...................................................... 390 10.3.2.2.2.3.2.1. DRA .................................................................................... 390



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10.3.2.2.2.3.2.2. TURN and UCAN ............................................................ 390 10.3.2.2.2.3.2.3. Southern California Generation Coalition .................... 391 10.3.2.2.2.3.2.4. SDG&E ............................................................................... 391 10.3.2.2.2.3.3. Discussion .......................................................................... 392 10.3.2.2.2.4. Distribution Pipeline Integrity .............................................. 394 10.3.2.2.2.4.1. Introduction ...................................................................... 394 10.3.2.2.2.4.2. Position of the Parties ...................................................... 397 10.3.2.2.2.4.2.1. DRA .................................................................................... 398 10.3.2.2.2.4.2.2. TURN and UCAN ............................................................ 398 10.3.2.2.2.4.2.3. SDG&E ............................................................................... 398 10.3.2.2.2.4.3. Discussion .......................................................................... 399 10.3.2.2.2.5. Public Awareness .................................................................... 401 10.3.2.2.2.5.1. Introduction ...................................................................... 401 10.3.2.2.2.5.2. Position of the Parties ...................................................... 402 10.3.2.2.2.5.2.1. DRA .................................................................................... 402 10.3.2.2.2.5.2.2. SDG&E ............................................................................... 403 10.3.2.2.2.5.3. Discussion .......................................................................... 403 10.3.2.2.3. Shared O&M Costs ...................................................................... 404 10.3.2.3. Capital Expenditures .................................................................. 405 10.3.2.3.1. Introduction ............................................................................. 405 10.3.2.3.2. New Additions ............................................................................ 407 10.3.2.3.2.1. Introduction ............................................................................. 407 10.3.2.3.2.2. Position of the Parties ............................................................. 408 10.3.2.3.2.2.1. DRA .................................................................................... 408 10.3.2.3.2.2.2. SDG&E ............................................................................... 408 10.3.2.3.2.3. Discussion ................................................................................. 409 10.3.2.3.3. Pipeline Replacements ............................................................ 410 10.3.2.3.3.1. Introduction ............................................................................. 410 10.3.2.3.3.2. Position of the Parties ............................................................. 411 10.3.2.3.3.2.1. DRA .................................................................................... 411 10.3.2.3.3.2.2. SDG&E ............................................................................... 412 10.3.2.3.3.2.3. Discussion .......................................................................... 412 10.3.2.3.3.2.4. Pipeline Relocations – Freeway ...................................... 412 10.3.2.3.3.3. Introduction ............................................................................. 413



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10.3.2.3.3.4. Position of the Parties ............................................................. 414 10.3.2.3.3.4.1. DRA .................................................................................... 414 10.3.2.3.3.4.2. SDG&E ............................................................................... 414 10.3.2.3.3.5. Discussion ................................................................................. 415 10.3.2.3.4. Compressor Stations ............................................................... 416 10.3.2.3.4.1. Introduction ............................................................................. 416 10.3.2.3.4.2. Position of the Parties ............................................................. 417 10.3.2.3.4.2.1. DRA .................................................................................... 417 10.3.2.3.4.2.2. SDG&E ............................................................................... 417 10.3.2.3.4.2.3. Discussion .......................................................................... 418 10.3.2.3.4.2.4. Cathodic Protection .......................................................... 418 10.3.2.3.4.3. Introduction ............................................................................. 419 10.3.2.3.4.4. Position of the Parties ............................................................. 420 10.3.2.3.4.4.1. DRA .................................................................................... 420 10.3.2.3.4.4.2. SDG&E ............................................................................... 420 10.3.2.3.4.5. Discussion ................................................................................. 421 10.3.2.3.5. LNG Support ........................................................................... 421 10.3.2.3.6. Meter and Regulator Stations ................................................ 422 10.3.2.3.6.1. Introduction ............................................................................. 422 10.3.2.3.6.2. Position of the Parties ............................................................. 423 10.3.2.3.6.2.1. DRA .................................................................................... 423 10.3.2.3.6.2.2. SDG&E ............................................................................... 423 10.3.2.3.6.3. Discussion ................................................................................. 424 10.3.2.3.7. Projects for Distribution ......................................................... 425 10.3.2.3.8. Capital Tools ............................................................................ 426 10.3.2.3.9. Direct Overheads ..................................................................... 427 10.3.2.3.10. DIMP ......................................................................................... 427

10.3.3. SoCalGas Gas Engineering ................................................... 428 10.3.3.1. Introduction .................................................................................... 428 10.3.3.2. O&M Costs ...................................................................................... 429 10.3.3.2.1. Introduction ............................................................................. 429 10.3.3.2.2. Non-Shared O&M Costs ........................................................ 430 10.3.3.2.2.1. Gas Engineering ...................................................................... 431 10.3.3.2.2.1.1. Introduction ...................................................................... 431



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10.3.3.2.2.1.2. Position of the Parties ...................................................... 434 10.2.2.3.3.1.2.1. DRA .................................................................................... 434 10.3.3.2.2.1.2.2. SCGC .................................................................................. 436 10.3.3.2.2.1.2.3. SoCalGas ............................................................................ 436 10.3.3.2.2.1.3. Discussion .......................................................................... 439 10.3.3.2.2.2. Transmission Pipeline Integrity Management.................... 443 10.3.3.2.2.2.1. Introduction ...................................................................... 444 10.3.3.2.2.2.2. Position of the Parties ...................................................... 446 10.3.3.2.2.2.2.1. DRA .................................................................................... 446 10.3.3.2.2.2.2.2. TURN and UCAN ............................................................ 447 10.3.3.2.2.2.2.3. SCGC .................................................................................. 447 10.3.3.2.2.2.2.4. SoCalGas ............................................................................ 448 10.3.3.2.2.2.3. Discussion .......................................................................... 449 10.3.3.2.2.3. Distribution Pipeline Integrity Management ...................... 451 10.3.3.2.2.3.1. Introduction ...................................................................... 452 10.3.3.2.2.3.2. Position of the Parties ...................................................... 455 10.3.3.2.2.3.2.2. TURN and UCAN ............................................................ 457 10.3.3.2.2.3.2.3. SoCalGas ............................................................................ 458 10.3.3.2.2.3.3. Discussion .......................................................................... 460 10.3.3.2.2.4. Public Awareness .................................................................... 462 10.3.3.2.2.4.1. Introduction ...................................................................... 462 10.3.3.2.2.4.2. Position of the Parties ...................................................... 463 10.3.3.2.2.4.2.1. DRA .................................................................................... 463 10.3.3.2.2.4.2.2. SoCalGas ............................................................................ 464 10.3.3.2.2.4.3. Discussion .......................................................................... 464 10.3.3.2.3. Shared O&M Costs .................................................................. 465 10.3.3.3. Capital Expenditures ..................................................................... 467 10.3.3.3.1. Introduction ............................................................................. 467 10.3.3.3.2. Pipeline Integrity – Distribution ............................................... 469 10.3.3.3.3. DIMP ............................................................................................. 470 10.3.3.3.4. New Additions ............................................................................ 471 10.3.3.3.4.1. Introduction ............................................................................. 471 10.3.3.3.4.2. Position of the Parties ............................................................. 472 10.3.3.3.4.2.1. DRA .................................................................................... 472



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10.3.3.3.4.2.2. SoCalGas ............................................................................ 472 10.3.3.3.4.2.3. Discussion .......................................................................... 473 10.3.3.3.4.2.4. Replacements and Pipeline Integrity Program ............ 474 10.3.3.3.4.3. Introduction ............................................................................. 475 10.3.3.3.4.4. Position of the Parties ............................................................. 476 10.3.3.3.4.4.1. DRA .................................................................................... 476 10.3.3.3.4.4.2. SoCalGas ............................................................................ 476 10.3.3.3.4.5. Discussion ................................................................................. 477 10.3.3.3.5. Relocations – Freeway ................................................................ 478 10.3.3.3.6. Relocations – Franchise/Private ............................................... 479 10.3.3.3.7. Compressor Stations ................................................................... 481 10.3.3.3.7.1. Introduction ............................................................................. 481 10.3.3.3.7.2. Position of the Parties ............................................................. 482 10.3.3.3.7.2.1. DRA .................................................................................... 482 10.3.3.3.7.2.2. SoCalGas ............................................................................ 483 10.3.3.3.7.3. Discussion ................................................................................. 483 10.3.3.3.8. Cathodic Protection ................................................................ 484 10.3.3.3.9. Meter and Regulator ............................................................... 485 10.3.3.3.10. Auxiliary Equipment .............................................................. 486 10.3.3.3.11. Pipeline Land Rights ............................................................... 487 10.3.3.3.11.1. Introduction ............................................................................. 487 10.3.3.3.11.2. Position of the Parties ............................................................. 488 10.3.3.3.11.2.1. DRA .................................................................................... 488 10.3.3.3.11.2.2. SoCalGas ............................................................................ 489 10.3.3.3.11.3. Discussion ................................................................................. 490 10.3.3.3.12. Laboratory Equipment ............................................................... 491 10.3.3.3.12.1. Introduction ............................................................................. 491 10.3.3.3.12.2. Position of the Parties ............................................................. 492 10.3.3.3.12.2.1. DRA .................................................................................... 492 10.3.3.3.12.2.2. SoCalGas ............................................................................ 492 10.3.3.3.12.3. Discussion ................................................................................. 493 10.3.3.3.13. Capital Tools ................................................................................ 494 10.3.3.3.14. Gas Storage – Supervision & Engineering Direct Overheads

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edmund g. brown jr., governor public utilities … · 2013-04-02 · state of california edmund g....

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