RE: DA Suspended, but NOT retroactively ,
 Dan.  You might want to amend.  The decision puts everyone on notice that t=
he Commission is going to consider taking it back to July 1---no info on wh=
at the decision process would be.
=20
Best,
Jeff

-----Original Message-----
From: Dan Douglass [mailto:douglass@energyattorney.com]
Sent: Thursday, September 20, 2001 2:34 PM
To: ARM
Cc: Vicki Sandler; Tamara Johnson; Mara, Susan; Steve Huhman; Roger Pelote;=
 Rob Nichol; Randy Hickok; Nam Nguyen; Jim Crossen; Dasovich, Jeff; Janie M=
ollon; Jack Pigott; Greg Blue; George Vaughn; Gary Ackerman; Ed Cazalet; De=
nice Cazalet Purdum; Curtis Kebler; Curt Hatton; Corby Gardiner; Charles Mi=
essner; Carolyn Baker; Bill Ross; Karen Shea; Max Bulk
Subject: DA Suspended, but NOT retroactively


The Commission has just voted 3-2 to approve the draft ALJ Barnett decision=
, modified to be prospective only.  There is NO retroactive suspension.
=20

Carl Wood introduced the ALJ's draft decision, with a diatribe against dire=
ct access.  He said that DA is a subsidy from less attractive customers to =
large customers and an example of the saying that, "big dogs eat first and =
big dogs eat best."  He added that most comments advocated delay of suspens=
ion and no retroactivity.  He said he "finds it hard to consider these comm=
ents to be anything but misleading and disingenuous."  He added that, "Smal=
l consumers effectively have no options."  He said retroactivity will be th=
e subject of further review, although it was not clear what this meant.  Wi=
thin 14 days, the UDCs must inform the Energy Division of steps taken not t=
o accept DASRs for contracts entered into after 9/20/01.  He said that dire=
ct access is half of the failed deregulation process; the other half was op=
ening ourselves up to the erratic wholesale market.  He said that supporter=
s of DA engage in "hollow rhetoric."  The market has failed in the state, a=
nd, "We need to put an end to the lack of social responsibility in the elec=
tric market."

He concluded that several commenters had indicated that direct access was a=
 way for making green power available to residential customers.  He respond=
ed that this just means other customers are getting more dirty coal-fired p=
ower.  He concluded that advocates of direct access make a "fraudulent clai=
m of customer choice." <?xml:namespace prefix =3D o ns =3D "urn:schemas-mic=
rosoft-com:office:office" />

Commissioner Bilas then spoke for his alternate, responding to Wood.  He sa=
id he had learned how to count, and he can count to three.  He then briefly=
 summarized his alternate.  First, he expressed disappointment in the Sacra=
mento process and the fact that they had not yet done something to rescue d=
irect access.  Second, he indicated his view of DA was a lot different from=
 that of other people.  He said he had always opposed the AB 1890 provision=
 that instituted the UDC buy-sell arrangement, saying that it eliminated th=
e largest customers from direct access.  Commissioner Duque then spoke brie=
fly to indicate his support for the Bilas alternate draft decision and his =
strong support for direct access.=20

Commissioner Brown said first, "In the weight of these sad times we must ob=
ey.  We are paying the price of the severe energy crisis which occurred las=
t year and the extraordinary means that were used to resolve it."  In an or=
dinary market, he thinks DA is good, but there is no way it can coexist wit=
h the State's $22 billion worth of bonds.  Therefore, there is no question =
that it has to be suspended.  "We probably should have done so months ago, =
in order to avoid a last-minute stampede."  There is an inequity between cu=
stomers that have moved to opt for direct access and those who have not.  B=
ut sometimes "you don't have a lot of good choices, and this is one of thos=
e times."  "If future legislation comes forward, and we hope that it would,=
" the Commission will attempt to revise this action.  =20

President Lynch noted the State Senate leadership has written asking for a =
study to be delivered by 1/1/02 as to how DA can be maintained without bias=
 to ratepayers and she supported this action.=20

Bilas and Duque indicated they will both file dissents.=20

In conclusion, we have prevailed in our opposition to retroactive direct ac=
cess suspension.  We now need to consider whether we want to contest the su=
spension itself, on legal/procedural grounds.

Dan
=20
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