Annex 1

Presiding Officer Decision

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STATE OF CALIFORNIA GAVIN NEWSOM, Governor

PUBLIC UTILITIES COMMISSION 

505 VAN NESS AVENUE 

SAN FRANCISCO, CA 94102-3298 

August 6, 2019 

TO PARTIES OF RECORD IN INVESTIGATION 18-07-008: 

This proceeding was filed on July 12, 2018, and is assigned to Commissioner Guzman Aceves 

and Administrative Law Judge (ALJ) Kelly. This is the decision of the Presiding Officer, 

ALJ Kelly. 

Any party to this adjudicatory proceeding may file and serve an Appeal of the Presiding 

Officer’s Decision within 30 days of the date of issuance (i.e., the date of mailing) of this 

decision. In addition, any Commissioner may request review of the Presiding Officer’s Decision 

by filing and serving a Request for Review within 30 days of the date of issuance. 

Appeals and Requests for Review must set forth specifically the grounds on which the appellant 

or requestor believes the Presiding Officer’s Decision to be unlawful or erroneous. The purpose 

of an Appeal or Request for Review is to alert the Commission to a potential error, so that the 

error may be corrected expeditiously by the Commission. Vague assertions as to the record or 

the law, without citation, may be accorded little weight. 

Appeals and Requests for Review must be served on all parties and accompanied by a 

certificate of service. Any party may file and serve a Response to an Appeal or Request for 

Review no later than 15 days after the date the Appeal or Request for Review was filed. In cases 

of multiple Appeals or Requests for Review, the Response may be to all such filings and may be 

filed 15 days after the last such Appeal or Request for Review was filed. Replies to Responses 

are not permitted. (See, generally, Rule 14.4 of the Commission’s Rules of Practice and 

Procedure at www.cpuc.ca.gov.) 

If no Appeal or Request for Review is filed within 30 days of the date of issuance of the 

Presiding Officer’s Decision, the decision shall become the decision of the Commission. In this 

event, the Commission will designate a decision number and advise the parties by letter that the 

Presiding Officer’s Decision has become the Commission’s decision. 

/s/ ANNE E. SIMON 

Anne E. Simon 

Chief Administrative Law Judge 

AES:mph 

Attachment 

FILED

08/06/19

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Decision PRESIDING OFFICER’S DECISION (Mailed 8/6/2019)

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Order Instituting Investigation into 

Pacific Gas and Electric Company’s 

(U39E) Failure to Provide a 24-hour 

Notice Prior to Residential Electric 

Service Disconnections Between July 1 

and July 18, 2016 and Adequacy of its 

Remedy Going Forward. 

Investigation 18-07-008 

PRESIDING OFFICER’S DECISION 

ADOPTING SETTLEMENT AGREEMENT 

Summary 

Pursuant to Rule 12.1 of the Commission’s Rules of Practice and 

Procedure, this decision approves an all-party settlement between Pacific Gas 

and Electric (PG&E) and the Commission’s Consumer Protection and 

Enforcement Division (CPED), which was filed on April 15, 2019. The settlement 

proposes that PG&E violated its Electric Tariff Rule 8 A.2 by failing to provide 

6,255 customers at least 24 hour notice prior to disconnection for non-payment 

between July 1 and July 18, 2016 and disconnected 217 customers on 

October 20, 2018. The settlement resolves all issues in this proceeding and 

provides that PG&E will provide a $100 bill credit to the 6,371 customer accounts 

and will also contribute $637,100 to the Relief for Energy Assistance through

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 Community Help (REACH) program.1 We find the settlement is reasonable in 

light of the record, consistent with the law, and in the public interest. We, 

therefore, approve and adopt the settlement. 

1. Background and Procedural History 

A prehearing conference was held in this matter on October 30, 2018. A 

scoping ruling was issued on December 18, 2018. On January 31, 2019, the 

parties filed a motion to amend the scoping ruling. On February 19, 2019, an 

amended scoping ruling was issued. Pacific Gas and Electric Company (PG&E) 

and the Utility Enforcement Branch of the Commission’s Consumer Protection 

and Enforcement Division (CPED)2 (collectively, referred to as the Parties) 

reached a settlement to resolve all of the issues in this proceeding (Settlement 

Agreement). The Parties filed a motion to adopt the Settlement Agreement on 

April 15, 2019 and a joint motion to amend the Settlement Agreement on 

May 9, 2019.3

1.1. CPED Investigation, Recommendations 

and Report 

This proceeding was initiated through an Order Instituting Investigation 

(OII) on July 12, 2018, to determine whether the named respondent, PG&E, 

violated any provisions of the Public Utilities Code, Commission General Orders, 

Decisions, Rules of Practice and Procedure, or other applicable laws or 

1 This program provides support to PG&E customers facing difficulties paying their bills. 

2 CPED is a Division of the Commission charged with investigating and enforcing compliance 

with the Pub. Util. Code and other utility laws, and the Commission’s rules, regulations, orders 

and decisions. 

3 The Amended Settlement Agreement is attached as Attachment A to this decision. 

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requirements pertaining its failure to provide 24-hour notice required in its 

Electric Rule No. 8 A.2 Tariff (Rule 8 A.2).4 

This OII is in response to an investigation conducted by the Commission’s 

Utility Enforcement Branch (EUB).5 After conducting its investigation, CPED 

staff developed a report: “Investigation of PG&E for Admitted Violation of Rule 

8 A.2 By Improperly Disconnecting Electric Customers”(Staff Report) dated June 

11, 2018.6 

From July 1 to July 18, 2016, PG&E disconnected approximately 6,255 

residential electric customers without providing an outbound telephone call at 

least 24 hours prior to the disconnection of service.

7 PG&E’s Contact Center 

Operations discovered this had happened on July 19, 2016.8 PG&E notified the 

Commission’s Policy and Planning Division that it had completed the 

disconnections without proper notice on August 30, 2016.9 The Staff Report 

details PG&E’s admission of violating Rule 8 A.2 by failing to provide 24-hour 

notice to residential electric customers prior to disconnection service.10 The 

report also details PG&E’s remedies to prevent future service disconnections 

4 Rule 8 A.2 provides in pertinent part that PG&E is required to provide a 15-day notice if after 

19 days, a residential customer has a past due balance. Subsequent to this 15-day notice, PG&E 

must provide a 48-hour and a 24-hour notice of disconnection if a customer’s account balance is 

still past due. 

5 Prior to June 1, 2016, EUB was in the Commission’s Safety and Enforcement Division. 

6 The Staff Report is attached to OII. 

7 Staff Report at 1. 

8 Id. at 2. 

9 Id.

10 PG&E admitted that its automated calling system failed between July 1 and July 18, 2016 and 

that it disconnected 6,255 customers without proper notice in violation of Rule 8 A.2. (See, Staff 

Report Attachment D). 

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without proper notice. PG&E addressed the automated calling malfunction by 

moving the customer telephone notification function to a new server11 and 

instituted notification processes that indicate when calls are not initiated or are 

not completed. These notifications are manually reviewed each business day, 

and the notifications allow for real-time inter-department communications to 

cancel disconnection activities if an error occurs. 

On October 20, 2018, PG&E discovered that it had disconnected 217 

customers for non-payment that day. On October 12, 2018, one of PG&E’s Java 

Message Service Servers stopped processing order for electric shut-off-fornonpayment. On October 20, 2018, a routine maintenance was performed on the 

servers, thereby restarting the servers and causing them to process and complete 

all queued transactions that had been stored since October 12, 2018. This 

resulted in 217 electric service disconnections across PG&E’s territory. These 

disconnections happened on a Saturday, which is in violation of PG&E’s Electric 

Tariff Rule 11B. 

As part of PG&E’s corrective measures, PG&E implemented a control that 

discards any remote disconnection transactions that are stuck for two or more 

hours. If a server restarts during the two-hour window, the transactions will also 

be discarded. Additionally, PG&E implemented various notification measures 

that alerts its Credit Department, the Smart Meter Operations Center, and 

Enterprise Integration that there are transactions held in a queue in order to 

allow each business group to address any potential issues in real-time. 

11 The initial disconnections resulted from a technical issue with automated calling server. 

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PG&E notified the Commission about these disconnections via telephone 

on October 29, 2018 and discussed the incident during the October 30, 2018 

Prehearing Conference for this investigation. 

This incident was added to the scope of this proceeding following the 

issuance of the Assigned Commissioner’s Amended Scoping Memo and Ruling 

dated February 19, 2019. 

2. The Settlement Agreement 

In general, the main components to the Settlement Agreement are (1) the 

recitals and (2) the agreement. PG&E voluntarily acknowledges that the events 

that occurred in this proceeding were in fact a violation of two of its tariffs. 

Among other things, the Settlement Agreement establishes that PG&E will do the 

following: 

Customer Payments: Within ninety days of the Commission’s 

issuance of a decision adopting this Agreement, PG&E will 

provide a bill credit of $100 to each of 6,371 customer accounts 

that have not already received a $100 credit.12 The total for 

this portion of the Agreement is $637,100, to be paid by 

shareholders. For undeliverable bill credits to customers 

affected by the June 2016 and October 2018 disconnections, 

such refunds will escheat to the State of California consistent 

with PG&E’s current practices. 

Contribution to Relief for Energy Assistance through Community Help 

(REACH): Upon the Commission issuing a decision adopting this 

Agreement, PG&E shall owe a contribution to the REACH Program in the 

amount of $637,100 (the “REACH Claim”), to be paid by shareholders, on 

account of the prepetition claims settled herein. PG&E may satisfy the 

REACH Claim in accordance with the terms of an order entered by the 

12 The 101 customers that already received a $100 credit through PG&E’s Quality Assurance 

Standard Provision (QAS) #10 will not receive any additional credit under this Agreement. 

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Bankruptcy Court13 granting PG&E authority to pay the REACH Claim in 

full or in part. PG&E will request that the Bankruptcy Court grant PG&E 

authority to pay the REACH Claim in full within ninety days of the 

Bankruptcy Court’s authorization. In the event the Bankruptcy Court 

authorizes PG&E to pay the REACH Claim in full or in part but does not 

specify a time to comply, PG&E will pay the claim within ninety days of 

the Bankruptcy Court’s authorization. 

2.1. Penalty 

Both Parties contend that a penalty is not warranted in this proceeding. 

They noted PG&E’s openness in reporting the violation that started the original 

investigation and the incident that was added to the proceeding in the amended 

scoping ruling. An additional consideration is that these disconnections were a 

result of a technical issue and not a deliberate action. 

3. Standard of Review 

The Joint Motion seeks Commission approval and adoption of the 

Settlement Agreement and its terms. Under Rule 12.1 of the Commission’s Rules 

of Practice and Procedure to approve and adopt a settlement, the Commission 

must find that a settlement is reasonable in light of the whole record, consistent 

with the law, and in the public interest. 

4. Discussion 

As discussed below, the Settlement Agreement addresses all issues in the 

scope of this proceeding and meets the Rule 12.1(d) requirements. We will first 

evaluate the provision of the Settlement Agreement not to impose a penalty on 

PG&E. Then we discuss how the Settlement Agreement, as a whole, addresses 

all issues in this proceeding and complies with Rule 12.1(d) requirements. 

13 United States Bankruptcy Court for the Northern District of California, Case Number 

19-30088-DM. 

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4.1. Penalty 

As noted above, the Settlement Agreement indicates that a penalty is not 

appropriate in this proceeding. We note that PG&E was proactive in reporting 

both incidents to the Commission. We also note that PG&E has implemented 

several provisions to prevent these types of technical failures in the future. 

Additionally, we note that PG&E has agreed to give all 6,371 customers impacted 

by the July 2016 and October 2018 disconnections a bill credit of $100 and it has 

also agreed to make a contribution to the REACH Program in the amount of 

$637,100, both of which will be funded by shareholders and not the ratepayers. 

We also agree that the PG&E made various corrections to prevent these types of 

future technical failures and is making a substantial contribution to REACH 

Program. Furthermore, we recognize that these disconnections were a result of 

technical failures and not a deliberate act. Therefore, we conclude that it is 

appropriate not to impose a penalty in this proceeding. 

4.2. Rule 12.1 Compliance 

Now we turn to the whole of the Settlement Agreement to discuss how it 

addresses all the issues in the proceeding and meets the requirements of 

Rule 12.1(d) of the Commission’s Rules of Practice and Procedure that it is 

reasonable in light of the whole record, consistent with the law and in the public 

interest. 

As discussed in this decision, this Settlement Agreement resolves all the 

issues within the scope of this proceeding, as set forth in the OII which provided 

that the purpose of this investigation was to examine whether PG&E violated 

Tariff Rule 8 A.2 when it failed to provide an outbound call at least 24 hours 

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prior to disconnection.14 The Settlement Agreement also resolves the issue 

added to the amended scoping ruling of this proceeding when PG&E again selfreported that it disconnected 217 customers on a Saturday in violation of Electric 

Tariff Rule 11B. 

PG&E represents the utility and its shareholders, while CPED represents 

the interests of ratepayers. The settlement is the result of extensive and vigorous 

negotiations. The parties to the settlement have a thorough understanding of the 

issues and could therefore make informed decisions in the settlement process. 

The Commission could have resolved the issues differently than the 

Settlement Agreement. Accordingly, the settling parties have balanced a variety 

of issues of importance to them and have agreed to the settlement as a reasonable 

means by which to resolve the issues. For the reasons discussed above, the 

settlement is reasonable in light of the record as a whole. 

There are no terms within the settlement agreement that would bind the 

Commission in the future or violate existing law. Therefore, we find the 

settlement consistent with the law. 

There is a public policy favoring the settlement of disputes to avoid costly 

and protracted litigation.15 The settlement satisfies this public policy preference 

for the following reasons: 

a. By reaching agreement, the parties avoid the costs and 

uncertainties of further litigation in this proceeding and 

eliminate the possible litigation costs for rehearing and 

appeal. Approval of the settlement provides speedy and 

complete resolution of the issues. 

14 By its own reporting PG&E admitted to violating this rule. 

15 Decision (D.) 88-12-083, 30 CPUC 2d 189, 221. 

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b. The settlement meets the applicable settlement standards 

of Rule 12.1(d), should be accorded the same deference the 

Commission accords settlements generally, and should be 

adopted. 

c. Bill credits will provide the impacted customers with 

compensation and PG&E will also make a significant 

contribution to the REACH Program. 

Adoption of the settlement is binding on all parties to the proceeding. 

However, pursuant to Rule 12.5, the settlement does not bind or otherwise 

impose a precedent in this or any future proceeding. 

Based thereon, we find the Settlement Agreement and its terms reasonable 

in light of the whole record, consistent with law, and in the public interest. 

5. Categorization and Need for Hearing 

The OII categorized this proceeding as adjudicatory as defined in 

Rule 1.3(a) and anticipated that this proceeding would require evidentiary 

hearings. The Assigned Commissioner’s Scoping Memo and Ruling affirmed 

that categorization. However, the parties reached a settlement before hearings 

were conducted. Therefore, the preliminary finding that hearings would be 

necessary is changed to no hearings necessary. 

6. Assignment of Proceeding 

Martha Guzman Aceves is the assigned Commissioner and Gerald F. Kelly 

is the assigned Administrative Law Judge and Presiding Officers in this 

proceeding. 

Findings of Fact 

1. On June 11, 2018 CPED issued a Staff Report on the self-report of PG&E’s 

violation of Rule 8 A.2. 

2. On February 19, 2019, the scoping memo was amended to investigate 

PG&E’s self-reported violation of Rule 11B. 

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3. Based on the Staff Report, the Commission initiated an OII to investigate 

the violations. 

4. CPED and PG&E are the only parties to this proceeding, and they have 

negotiated the Settlement Agreement and filed their Joint Motion for Adoption 

of Settlement Agreement and Joint Motion to Amend Provisions in the Proposed 

Settlement Agreement. 

5. Penalties are not warranted in this proceeding. 

6. PG&E will provide a $100 bill credit to all 6,371 customers impacted by its 

July 2016 and October 2018 disconnects discussed in this proceeding. 

7. PG&E will also make a contribution to the REACH Program in the amount 

of $637,100. 

8. Both the bill credit and REACH contribution will be funded by 

shareholders. 

9. The issues in this proceeding are adequately addressed by the Settlement 

Agreement, and there are no outstanding issues of material fact in dispute. 

Conclusions of Law 

1. The Joint Motion for Adoption of the Settlement Agreement should be 

granted as amended by the Joint Motion to Amend Certain Provisions of the 

Settlement Agreement. 

2. The Settlement Agreement addresses all issues in the scope of this 

proceeding, including the issue added in the amended scoping ruling. 

3. The Settlement is reasonable in light of the whole record, consistent with 

law, and in the public interest, consistent with Rule 12.1(d) of the Commission’s 

Rules. 

4. I.18-07-008 should be closed. 

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O R D E R 

IT IS ORDERED that: 

1. The Joint Motion of Pacific Gas and Electric Company and the Consumer 

Protection and Enforcement Division for Adoption of Settlement filed on April 

15, 2019 as amended by the Joint Motion to Amend Provisions in the Proposed 

Settlement Agreement is granted, and the settlement is approved as set forth 

herein. 

2. Pacific Gas and Electric Company (PG&E) shall seek approval of the 

Settlement Agreement by the United States Bankruptcy Court for the Northern 

District of California, Case No. 19-30088-DM (the “Bankruptcy Court”) 

3. Pacific Gas and Electric Company (PG&E) shall be liable for a $100 bill 

credit to each of the 6,371 customers impacted by PG&E’s July 2016 and October 

2018 disconnections (the “Customer Credits”) within 90 days of the adoption of 

this Settlement Agreement, for an aggregate liability of $637,100. 

4. Pacific Gas and Electric Company (PG&E) shall satisfy the Customer 

Credits in accordance with the terms of an order to be entered by the Bankruptcy 

Court. 

5. Pacific Gas and Electric Company (PG&E) shall request that the 

Bankruptcy Court grant PG&E authority to the issue the Customer Credits 

within 90 days of the Bankruptcy Court’s authorization. 

6. If the Bankruptcy Court authorizes Pacific Gas and Electric Company 

(PG&E) to issue the Customer Credits, but does not specify a time to comply, 

PG&E shall issue such credits within 90 days of the Bankruptcy Court’s 

authorization. 

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7. For undeliverable bill credits to customers affected by the June 2016 and 

October 2018 disconnections, such refunds will escheat to the State of California 

consistent with Pacific Gas and Electric’s current practices. 

8. The Customer Credits will be funded by shareholders. 

9. Upon issuance of this decision, Pacific Gas and Electric Company shall be 

liable for a contribution of $637,100 to Relief for Energy Assistance through 

Community Help (REACH) program. 

10.Pacific Gas and Electric Company (PG&E) shall satisfy the contribution of 

$637,100 to the Relief for Energy Assistance through Community Help (REACH) 

program in accordance with terms of an order to be entered by the Bankruptcy 

Court. 

11.Pacific Gas and Electric Company (PG&E) shall request that the 

Bankruptcy Court grant PG&E authority to the contribute to the Relief for 

Energy Assistance through Community Help (REACH Program) within 90 days 

of the Bankruptcy Court’s authorization. 

12.If the Bankruptcy Court authorizes Pacific Gas and Electric Company 

(PG&E) to pay the Relief for Energy Assistance through Community Help 

(REACH) program claim, but does not specify a time to comply, PG&E shall 

satisfy the claim within 90 days of the Bankruptcy Court’s authorization. 

13.The $637,100 contribution to Relief for Energy Assistance through 

Community Help (REACH) program will be funded by shareholders. 

14.Within 120 days of the issuance of this Presiding Officer’s Decision, Pacific 

Gas and Electric shall provide a status update to the service list regarding 

Bankruptcy Court approval of the Settlement Agreement. 

15.This proceeding remains open pending approval of the Settlement 

Agreement by the Bankruptcy Court. 

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This order is effective today. 

Dated _________________2019, at San Francisco, California. 

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