Broad-Based Coalition Announces Support for PG&E Rate Case Decision.

SAN FRANCISCO--(BUSINESS WIRE)--Nov. 8, 1999--

A broad coalition of consumer advocates, agricultural groups, government organizations, commercial businesses, municipalities and energy suppliers today urged the California Public Utilities Commission (CPUC) to adopt an Administrative Law Judge's (ALJ) recommendation to allow a $240 million revenue increase for Pacific Gas and Electric Co. (PG&E).

Calling the ALJ's proposed decision fair and reasonable, the coalition reminded the CPUC that many of the members had recommended a decrease in PG&E's authorized revenue requirement during the proceedings leading to this recommendation. But after thoroughly reviewing the exhaustive ALJ decision, the coalition came to the conclusion that the almost nine percent increase in revenues allows PG&E to maintain a quality standard of service while earning an adequate rate of return.

The coalition urged the CPUC to dismiss PG&E's extraordinary request of $1 billion annual increase (down from its original request of more than $1.2 billion) as an undue burden on its customers and an unnecessary barrier to competition in the state's electricity market. The PG&E proposal would have resulted in higher electric distribution rates and extended the current rate freeze, making it virtually impossible for alternative energy suppliers to offer lower prices to PG&E customers.

"The ALJ's decision would increase PG&E's electric revenues by almost 10 percent and eight percent for its gas revenues," said Nettie Hoge, executive director of The Utility Reform Network (TURN). "It's hard to believe PG&E's claims that it can't provide adequate service with this proposed revenue increase."

The coalition's written comments highlight PG&E's efforts during the two year long proceedings to inflate its requested revenue requirement because it knew that "there is no way" the CPUC would give the company everything for which it asked. The proposed decision authorizes an additional $180 million for electric service which is a 9.4 percent increase above currently authorized revenues and a 7.9 percent increase, $63 million, for gas. In past general rate cases, PG&E's request for increased revenue requirements has been two to nine times higher than the amount authorized.

"California residents, businesses and schools will be the big losers if the CPUC goes along with PG&E's outrageous request to raise cost of current service by nearly $1 billion," said Karen Mills with the California Farm Bureau.

The coalition includes the CPUC's Office of Ratepayer Advocates, TURN, Agricultural Energy Consumers Association, Enron Corp., Federal Executive Agencies, California Farm Bureau Federation, Department of General Services, and the City and County of San Francisco.