revenue requirement, there are many customers who will be structural winners on TOU rates. In fact, structural winners will have a positive experience on TOU, making for greater customer acceptance. PG&E intends to market first to high usage customers who are more likely than low-usage customers to benefit from the TOU structure. On the other hand, too many structural winners will mean an undercollection that needs to be recovered from somewhere. The following table illustrates the impact of a baseline credit. Table comparing Peak/Offpeak rates with and without a baseline credit TOU schedules Off-Peak Summer Off-Peak Peak Summer with 1.6:1 peak Summer up to up to 100% of Summer over over 100% of to off-peak 100% of Baseline 100% of Baseline differential Baseline Baseline Baseline credit of $0.194 $0.311 $0.233 $0.350 roughly 4 cents No baseline $0.210 $0.336 $0.210 $0.336 credit Revenue Shortfall A revenue shortfall occurs when the revenues collected from a group of customers is less than the revenue that was forecast. The revenue shortfall will be amortized and included in future rates to make up for the undercollection. A revenue shortfall between classes can result when, for example, residential customers as a whole use less power than predicted. Depending on the structure of the rate when implemented, the undercollected amount could then be recovered from just the residential class in future years, or it could be recovered from all customer classes. In this proceeding we are primarily concerned with revenue shortfalls between different groups of customers within the residential class. The opt-in
revenue requirement, there are many customers who will be structural winners on TOU rates. In fact, structural winners will have a positive experience on TOU, making for greater customer acceptance. PG&E intends to market first to high usage customers who are more likely than low-usage customers to benefit from the TOU structure. On the other hand, too many structural winners will mean an undercollection that needs to be recovered from somewhere. The following table illustrates the impact of a baseline credit. Table comparing Peak/Offpeak rates with and without a baseline credit TOU schedules with 1.6:1 peak to off-peak differential Off-Peak Summer up to 100% of Baseline Summer up to 100% of Baseline Off-Peak Summer over 100% of Baseline Peak Summer over 100% of Baseline Baseline credit of roughly 4 cents $0.194 $0.311 $0.233 $0.350 No baseline credit $0.210 $0.336 $0.210 $0.336 Revenue Shortfall A revenue shortfall occurs when the revenues collected from a group of customers is less than the revenue that was forecast. The revenue shortfall will be amortized and included in future rates to make up for the undercollection. A revenue shortfall between classes can result when, for example, residential customers as a whole use less power than predicted. Depending on the structure of the rate when implemented, the undercollected amount could then be recovered from just the residential class in future years, or it could be recovered from all customer classes. In this proceeding we are primarily concerned with revenue shortfalls between different groups of customers within the residential class. The opt-in