PUC Proposals Would Reject Most of Edison’s Request to Increase Rates

Southern California Edison customers would see a slight uptick in their electricity bills under two separate rate proposals issued Friday by state regulators, representing a victory for consumer groups who fought the utility’s push for a larger increase.

While the two decisions from the California Public Utilities Commission differ on some details, both call for the Rosemead-based electric company to take in $2.756 billion a year from ratepayers -- an increase of $15 million, or 0.5%, over current revenue -- to cover higher operating, maintenance and other expenses.

Southern California Edison, a subsidiary of Edison International, had requested an increase of $251 million per year over its current rate revenue. An Edison spokesman said the company was still reviewing the lengthy proposals and would respond to the PUC in the next few weeks.

The Utility Reform Network, a San Francisco consumer advocacy group that opposed Edison’s rate request, said both proposals contain good news for the utility’s 4.2 million residential and business customers.

“On the face of it, it is very encouraging that both versions recognize that there’s just no way to justify the huge increase that the utility had been seeking here,” said Bob Finkelstein, the network’s executive director. The additional cost for an average Edison customer has not yet been calculated, but Finkelstein predicted that the increase under either proposal would be “virtually unnoticed” by most ratepayers.

The full five-member commission must make the final decision on the new rates. The commission can choose between the two decisions released Friday, one by Administrative Law Judge Mark Wetzell and one by PUC Commissioner Carl Wood, or they can consider alternate versions. The commission cannot take up the matter for at least 30 days.

Edison’s rate case is the first since the PUC decided to return to its old practice of setting rates according to a utility’s basic costs. The utility submitted its rate request in May 2002, and the PUC’s final rate decision would cover service to customers beginning in May 2003.

Although Edison did not comment Friday, the proposals represent a blow to the company, which has been gradually regaining its financial footing after the state’s costly energy crisis in 2000 and 2001. In its filing, the utility said the proposed $251-million increase was needed to offset higher employee and retiree medical costs, and to pay for stepped up investments in the company’s aging power grid.

Finkelstein of the utility network predicted that Edison and its parent firm would “unleash its army of lobbyists” to persuade the full commission to reject the proposed rate decisions in favor of one that would grant a larger increase.

“There will now be a lobby storm, and it’s going to be raining Edison for a few weeks,” Finkelstein said.