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ALJ/SCR/EW2/jt2Date of Issuance 5/24/2019Decision 19-05-020 May 16, 2019BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIAApplication of Southern California EdisonCompany (U338E) for Authority toIncrease its Authorized Revenues forElectric Service in 2018, among otherthings, and to Reflect that increase inRates.Application 16-09-001DECISION ON TEST YEAR 2018 GENERAL RATE CASE FOR SOUTHERNCALIFORNIA EDISON COMPANY293008003-1–
A.16-09-001 ALJ/SCR/EW2/jt2Table of ContentsTitlePageDECISION ON TEST YEAR 2018 GENERAL RATE CASE FOR SOUTHERNCALIFORNIA EDISON COMPANY . 1Summary . 21. Factual Background . 31.1. Procedural Background . 41.2. Settlements . 62. Evidentiary Standards and the Burden of Proof . 63. Affordability . 73.1. Affordability and “Just and Reasonable” Rates . 93.2. SCE’s Capital Expenditure Request . 123.3. Our Decision-Making Framework. 153.4. Recent Statutes and Commission Rulemakings RegardingAffordability. 204. Transmission and Distribution . 244.1. T&D – General . 244.1.1.Operational Overview . 25Risk-Informed Decision Making . 264.1.2.4.1.3.Safety and Reliability Investment Incentive Mechanism . 274.2. T&D – Customer-Driven Programs . 284.2.1.New Service Connections . 294.2.1.1. Residential Line Extensions . 314.2.1.2. Residential Tract Development . 334.2.1.3. Residential Backbone Development . 344.2.1.4. Commercial/Industrial Service Connections and TractDevelopment . 364.2.2.Rule 20 Issues . 374.2.3.Distribution Transformers . 404.3. T&D – System Planning . 424.3.1.Photovoltaic (PV) Dependability and Capacity-Driven CapitalExpenditures. 454.3.2.Distribution Circuit Upgrades . 494.3.3.New Distribution Circuits . 504.3.4.Substation Expansion Projects . 514.3.5.Substation Equipment Replacement Program . 524.3.6.Subtransmission Lines Plan . 53-i-
A.16-09-001 ALJ/SCR/EW2/jt2Table of Contents (cont.)TitlePage4.3.7.4 kV Programs . 544.3.7.1. 4 kV Cutover Program. 554.3.7.2. 4 kV Substation Elimination Program . 574.3.8.Grid Reliability Projects . 634.4. T&D – Distribution Maintenance and Inspection . 644.5. T&D – Distribution Construction & Maintenance . 644.6. T&D – Substation Construction & Maintenance . 674.7. T&D – Transmission Construction & Maintenance . 694.7.1.Transmission Overhead and Underground Line Maintenance –FERC Account 571.150 (partial) . 704.7.2.Transmission Vegetation Management – FERC Account571.150 (partial) . 714.7.3.Transmission Tools and Work Equipment . 724.8. T&D – Infrastructure Replacement. 734.8.1.Worst Circuit Rehabilitation Program . 754.8.2.Cable Life Extension Program . 774.8.3.Cable-In-Conduit Replacement Program . 784.8.4.Overhead Conductor Program (OCP) . 794.8.4.1. OCP Program Background . 794.8.4.2. SCE’s OCP Funding Request in this GRC . 814.8.4.3. Disallowance . 884.8.5.Underground Oil Switch Replacement Program. 894.8.6.Capacitor Bank Replacement Program . 894.8.7.Automatic Recloser Program . 904.8.8.PCB Transformer Replacement Program . 914.8.9.Substation Infrastructure Replacement Program . 914.8.10. Conclusion: Authorized Infrastructure Replacement ProgramCapital Expenditures . 934.9. T&D – Poles . 934.9.1.O&M Expenses . 944.9.2.Capital Expenditures . 984.9.3.Pole Loading and Deteriorated Pole Programs BalancingAccount . 994.10. T&D – Grid Modernization . 1004.10.1. Grid Modernization Capital Expenditures . 104- ii -
A.16-09-001 ALJ/SCR/EW2/jt2Table of Contents (cont.)Title5.Page4.10.1.1. Distribution Automation Programs . 1044.10.1.2. Communications . 1114.10.1.3. Tools for Data Analysis and Decision-Making . 1144.10.1.3.1.System Modeling Tool (SMT) . 1154.10.1.3.2.DRP External Portal . 1154.10.1.3.3.Grid Management System . 1154.10.2. Grid Modernization O&M Expenses . 1164.10.2.1. Intervenors’ Positions . 1164.10.2.2. SCE’s Rebuttal to Intervenors’ Positions . 1164.11. T&D – Grid Technology . 1174.11.1. Distribution Volt VAR Control . 1174.11.2. Equipment Demonstration & Evaluation Facility . 1184.11.3. Energy Storage Pilots . 1184.12. T&D – Safety Training & Environmental Programs . 1214.12.1. Environmental Program – Transmission (Acct. 565.281). 1224.12.2. Hazardous Waste Management & Disposal – Distribution(Acct. 598.250) . 1224.13. T&D – Other Costs, Other Operating Revenues . 124Customer Service . 1285.1. Customer Service – O&M . 1285.1.1.The Impact of Customer Growth . 1285.1.2.Metering Services. 1295.1.2.1. Meter Reading Operations – FERC Account 902 . 1295.1.2.2. Test, Inspect, and Repair Meters – FERCAccount 586.400 . 1295.1.2.3. Turn-On and Turn-Off Services – FERCAccount 586.100 . 1305.1.2.4. Customer Installation and Energy Theft Expense –FERC Account 587. 1305.1.2.5. Meter Services Operations and Management – FERCAccount 580 . 1315.1.3.Revenue Services Organization . 1325.1.3.1. Billing Services – FERC Account 903.500 . 1325.1.3.2. Credit and Payment Services – FERC Account 903.200 . 1355.1.3.3. Postage – FERC Account 903.100 . 135- iii -
A.16-09-001 ALJ/SCR/EW2/jt2Table of Contents (cont.)Title6.7.Page5.1.3.4. Uncollectable Expenses – FERC Account 904 . 1365.1.4.Customer Contact Center – FERC Account 903.800 . 1375.1.5.Business Customer Division – FERC Account 908.600 . 1375.1.6.Customer Programs and Services – FERC Account 905.900 . 1385.1.7.Operating Unit Management and Support – FERC Accounts901 and 907.600 . 1395.2. Customer Service – Capital . 1405.3. Customer Service – Other Operating Revenue . 1415.4. Customer Service – Additional Issues . 141Information Technology . 1456.1. Information Technology – O&M and Hardware. 1466.1.1.Hardware/Software Licenses & Maintenance . 1466.1.2.Business Integration & Delivery . 1466.1.3.Grid Services . 1486.2. Information Technology – Capitalized Software . 1496.2.1.Contingency Amounts in Capitalized Software Forecasts . 1496.2.2.Cybersecurity and Compliance . 1536.2.3.Grid Modernization Cybersecurity . 1546.2.4.Other Capitalized Software . 1546.2.4.1. Vegetation Management Project . 1546.2.4.2. Comprehensive Situational Awareness forTransmission . 1556.2.4.3. Grid Planning & Analytics Software . 1566.2.4.4. Enterprise Content Management Project . 1576.2.5.Operating System Software. 1586.3. Information Technology – Customer Service Re-Platform . 1596.4. Information Technology – SCE’s Use of Managed ServicesProviders. 161Generation . 1627.1. Generation – Nuclear Generation (Palo Verde) . 1627.2. Generation – Energy Procurement . 1637.3. Generation – Hydro Generation . 1637.4. Generation – Catalina . 1637.4.1.Catalina – O&M . 1637.4.2.Catalina- Pebbly beach Generating Station Automation . 163- iv -
A.16-09-001 ALJ/SCR/EW2/jt2Table of Contents (cont.)Title8.9.Page7.4.3.Catalina – Other Capital Projects Under 3 Million . 1677.5. Generation - Other . 1687.5.1.Mountainview . 1687.5.2.Peakers.
293008003 - 1 – ALJ/SCR/EW2/jt2 Date of Issuance 5/24/2019 Decision 19-05-020 May 16, 2019 BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA Application of Southern California Edison
