Opinion ID: 726753
Heading Depth: 5
Heading Rank: 2

Heading: 1995 CPUC Decision

Text: 51 SoCalGas suggests that the discussion of rates in the November 1995 CPUC decision supports its argument that its 1994 rate schedules show that its ratepayer-subsidized NGV fueling stations were part of a clearly articulated state policy. 52 The CPUC indeed points out that SoCalGas's rate schedules were not designed to cover the total costs of the service and compares the rates to PG & E's, which do not recover any portion of [the utility's] capital outlay, maintenance, or fuel taxes in supplying natural gas as a vehicle fuel. 165 P.U.R.4th at 552. The commission then restates the grounds for its approval of this rate structure in PG & E in 1991, including its interpretation of relevant statutory provisions. Id. at 556. However, the commission then notes that it cannot rest upon this interpretation of the relevant statutes to support the continued offering of subsidized service because the statutes must be interpreted in light of [the] guidelines adopted in 1993. Id. Specifically, the commission points out that ratepayer subsidization in the rates is unfair competition because of the utilities' ability to rely on captive, regulated customers to provide the subsidy, rather than depend on retained earnings, as would any competitor. Id. The commission then notes that there are other firms that are interested in competing within and against the compressed natural gas market. Id. 53 While the 1995 decision appears to be the first time that the commission expressly stated that SoCalGas's rate structure for NGV fueling stations was not in compliance with its 1993 guidelines because it allowed the utility to unfairly compete, the 1993 guidelines themselves required the utility to bring its NGV programs into conformity with the guidelines. If SoCalGas failed to do so, then the mere fact that the CPUC did not address that failure until 1995 does not constitute an articulated state policy approving the nonconforming conduct. While the commission in its 1995 decision did not order immediate revisions in the utilities' rates but instead directed the utilities to file tariffs that will allow for gradual transition from the current rate levels to rates that reflect the direct and fully allocated long-run marginal cost of the service being provided, id. at 557, this alone does not constitute ratification of SoCalGas' rate structure during the July 1993 to November 1995 period because it is not a clear articulation or affirmative expression of state policy to grant immunity to all pre-November 1995 conduct.